US-headquartered Gerald Metals has exited its physical steel business, one of its competitors said today.
The business was headed up by senior steel trader Michael Bienz, who has now left the company, the competitor said. Neither Gerald nor Bienz responded to requests for comment.
While the steel trading environment has become increasingly difficult of late amid rising protectionism and a reduction in net steel trade, the primary driver was reportedly the lack of a terminal hedging market in the steel sector.
Gerald was founded in 1962 as a base metals trader, and typically focuses on metals where it can lay up a large portion of its risk via hedging — this is not the case in the finished steel market, despite the nascent success of the London Metal Exchange's ferrous scrap contract, which the company has been involved with.
Gerald bought the metals trading arm of Reuben Brothers Resources Group in 2014, giving it exposure to the steel business.
The company is headquartered in Stamford, Connecticut, but steel trading was done out of the London office.
