Frequently asked questions about metals price risk management.
What is metals price risk management?
Metals price risk management is the discipline of identifying, measuring and controlling the financial exposure a business has to moving metals prices, then putting the structure, goals, controls, reporting and hedging execution in place to manage it deliberately rather than by accident.
We are a conservative business. Do we really have metal price risk?
Yes. "Conservative" does not equal "risk managed". Every metals-based company carries price risk through its chain of buying, converting and selling. What varies is whether that risk is measured and managed, and our first task with a new client is usually to test the assertions and track the exposures.
What is a spread, and why should a metal manufacturer care?
Exchange prices for nearby and forward dates differ, and that difference (the spread, shaped by contango and backwardation) moves independently of outright price levels. For a hedger, spreads change the cost of rolling hedges and can erode or boost results even when the price view is right.
Which industries does the team serve?
We have performed work across the metals value chain: producers, smelters, refiners, extruders, wire and cable makers, die casters, alloyers, brass mills, rollers, galvanizers, specialty and stainless steel makers, battery makers, consumer goods manufacturers, automotive suppliers, aerospace, recyclers, physical traders, warehousing, exchanges, government entities and regulators, private equity and financial institutions, lawyers, airlines and chemical manufacturers.
Where does the team work?
From offices in Europe and North America we serve clients in the metals industry in more than 33 countries across six continents. Explore our markets by region.
Do you work with businesses that already have a price risk programme?
Yes. Whether you are starting a new programme or upgrading an existing one, we embed our skills in your business. Nearly every client’s business is unique, and so are their metal price problems.
Who is on the team?
The practice was founded in 2000 by David Waite, a well-respected LME broker in London and New York, and has attracted a highly skilled team of partners bringing together many decades of global experience from across the metals industry.
How do we get started?
Contact us at info@themetalsriskteam.com or through any partner directly. We always welcome the opportunity to talk about your price risk problems and can arrange an obligation-free discussion.