Euronext wanted to expand its range of offerings in the commodities space to participants across the European marketplace, in particular to eventually make the process for physical delivery simpler and more secure. The idea was to replace the manual paper/email processes with an automated system, whilst taking advantage of this digitisation to enable commodity owners to more easily leverage their product.
Enter Euronext Inventory Management (EIM), a new web-based system built from the ground up by Sinara Consultants, intended as a first step in delivering Euronext’s vision. The system enables storage facility owners to issue electronic “Certificats d’entreposage” (warehouse or storage receipts) to Euronext member firms which give evidence of product in storage. EIM manages ownership and possession of physical product, facilitates the transfer of the title and holding of collateral, and enables asset finance, product lending, repos, securities lending agreements and other financial instruments.
As Euronext plans to introduce documents of title in the form of Euronext warrants, these can be configured in EIM to complement or replace Certificats d’entreposage. Transfer of title with warrants will allow EIM to use warrants for clearing counterparty-mediated or alternative delivery processes.
A typical workflow might involve a storage facility owner using EIM to issue a set of warrants to a general clearing member (GCM) who owns a certain amount of product, say wheat or corn, in one of their silos. As soon as this is issued, the GCM will be notified and can see the warrants in EIM, transfer them into an account (either house or client) and tag them as needed.
At any time, the GCM can request ‘load out’ of the product by the storage facility owner (SFO) and the associated warrants will be cancelled and a receipt generated.
As the time for delivery approaches, the GCM can notify the clearing counterparty of its intention to deliver through a simple notification mechanism, or a full delivery process in which warrants are transferred within EIM. When the clearing counterparty logs into EIM, they will see all of the warrants that GCMs have sent to them as part of their notification of intent to deliver.
User screens were built for use by different stakeholders, including storage facility (silo) owners and operators, financial institutions, GCMs and clearing counterparties. A real-time warrants page allows different types of users to have a ‘view’ on the warrants associated with them, and perform actions throughout the warrant’s lifecycle.
A full administration user interface allows Euronext to configure new participants, users, contract types, quality attributes, and many other aspects of the system.
Both the administration interface and the user screens have multi-language support (currently English, French, German and Dutch), with capacity for new ones to be added in future.
An export process performs a daily export of changes to warrants to Euronext’s data warehousing systems.
Access to the system is controlled by a login screen, and a permissions framework that ensures each user can only have access to the warrants and associated actions they are entitled to. The system is designed to be highly secure from the ground up, with Euronext’s information security team placing stringent requirements.
The system is accessible 24 hours a day, and so all components are designed to be highly resilient and work across twin sites.
Sinara built the server-side portion of the application entirely in C# using ASP.NET MVC, whilst the client-side portions were a mix of HTML5, CSS and Typescript. A SQL Server database stored all of the user and warrant data, and was accessed using Entity Framework. The team also used a number of open source libraries and prebuilt Sinara components to rapidly build up the application. In particular, ASP.NET SignalR was chosen to create reliable real-time pages that worked well on different browsers.
Many of the pages required formatted, easy to read, data grids to be presented, which could be manipulated by the user, with new rows inserted, updated or deleted. The Sinara team built a reusable client-side grid component that enabled the creation of new pages that supported reliable updating in the background as a result of changes made by other users .
The project started with a basic specification outlining the goals of the project, and the overall vision. A lot of detail had to be worked out through discussions between Sinara and the Euronext commodities team, major silos, market participants and other stakeholders.
In parallel, Sinara rapidly developed and demonstrated a prototype application and proof-of-concept system that showcased real-time warrant creation and issuance.
The project was then planned in two week ‘sprints’, with a clear set of goals for development that was agreed with the client. A dedicated Sinara project manager ensured any changes mid-sprint were properly assessed, incorporated into the plan, and that the team was able to quickly adjust and deliver the new requirements. The effective use of automated UI testing tools formed a significant part of the success of the project.
Sinara hosted the initial version of the software to make it easy for Euronext to demonstrate to various internal and external user groups. The team then worked closely with Euronext’s IT department to transfer the final system onto their own hosting environment.
Sinara continues to provide support and maintenance for the EIM software under our advanced support process.