Who we are

SteelHedge is a forward pricing and risk management platform for the whole range of steel products and steelmaking raw materials.

Through technology and partnerships with leading providers of market data and post-trade services, we enable a better way to ensure costs, revenues and margins in advance WITHOUT financial intermediation. The platform is exempted from financial regulation by FINMA, the Swiss financial regulator, because it doesn’t engage in financial market activities.

We are neutral, independent and committed to the industry, its suppliers and customers worldwide.

Our role

SteelHedge develops the technology, legal environment and multi-stakeholder ecosystem for a liquid and safe forward market at the service of the real economy.

We represent the interests of ferrous market participants across global and regional supply chains—producers, recyclers, end-users and everyone in between.

The platform facilitates forward pricing and risk management in decentralized commercial markets without acting as a market maker or a counterparty in any transaction.

Where we come from

As industry insiders, we believe that financial derivatives are NOT good for steel for several reasons:

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Standardization

Traditional commodity derivatives require a high degree of standardization and centralization for trading—but steel is not a commodity.

The diversity of steel products and regional idiosyncrasies hinder the development of exchange-traded futures with sufficient customization and liquidity.

Way forward

A decentralized market and flexible paper contracts reflecting a complex supply chain.

Traditional commodity derivatives require a high degree of standardization and centralization for trading—but steel is not a commodity.

The diversity of steel products and regional idiosyncrasies hinder the development of exchange-traded futures with sufficient customization and liquidity.

Way forward

A decentralized market and flexible paper contracts reflecting a complex supply chain.

Inconvenience

Understanding and managing financial derivatives is not an easy task, especially for SMEs and companies that never dealt with them before.

As derivatives clearing becomes mandatory, it doesn’t take into account very different motives and risk profiles exhibited by suppliers, end-users and speculators.

Way forward

Simple paper contracts that easily integrate with supply agreements.

Flexible post-trade processing based on user preferences and risk profiles.

Understanding and managing financial derivatives is not an easy task, especially for SMEs and companies that never dealt with them before.

As derivatives clearing becomes mandatory, it doesn’t take into account very different motives and risk profiles exhibited by suppliers, end-users and speculators.

Way forward

Simple paper contracts that easily integrate with supply agreements.

Flexible post-trade processing based on user preferences and risk profiles.

Financialization

Over the years, both commodity exchanges and derivatives traded on them came a long way from their original purpose—risk management.

As exchanges turned from non-profit utilities into corporations, the financial sector became their prime source of revenue, spurring financial speculation and distorting commodity markets.

Way forward

A digital utility for the real economy, insulated from undue influence of financial markets.

Over the years, both commodity exchanges and derivatives traded on them came a long way from their original purpose—risk management.

As exchanges turned from non-profit utilities into corporations, the financial sector became their prime source of revenue, spurring financial speculation and distorting commodity markets.

 

Way forward

A digital utility for the real economy, insulated from undue influence of financial markets.

Where we go

Digital economy tackles these issues at their roots:

  • SteelHedge Contracts may use hundreds of commercial market prices licensed by leading price reporting agencies, and may be converted into supply agreements;
  • When required, settlements between users are secured by first-tier financial institutions (escrow, insurance, clearing);
  • Trading is facilitated by customized algorithms and corporate insights from established risk and compliance data providers.

Powered by network effects, this ecosystem enables forward pricing and risk management in decentralized commercial markets—the way steel and steelmaking raw materials are traded today.

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