Last week, I had a call with Frank Jackel, founder of metalshub, to discuss this interesting initiative in more detail. According to its website, metalshub will provide a digital marketplace for metals and ferroalloys to promote a more efficient and liquid physical market. Established in 2016, metalshub is based in Düsseldorf, Germany but operates globally. It is an international team with team members from five different countries and extensive experience in physical metals trading and logistics. Indeed, Frank and his co-founder have been in the metals business for around 20-years, working for Anglo American and The Boston Consulting Group (BCG), and have relevant academic backgrounds as well.
The idea, Frank told me, was that “ferrous metals and alloys today have no index listings and are as a result, quite inefficient markets. A lot of business is conducted as long-term, fixed price deals currently.” metalshub establishes a trading platform to trade materials directly and create more efficiency, speed and transparency in the market. The platform is a couple of weeks from launch and it was developed by the entity from scratch. “Digitalization offers huge benefits,” Frank said. The focus will be on non-LME commodities for smaller to mid-sized deals and entities.
The platform features both logistics and trade where metalshub can organize transportation and so on. metalshub offers a wide range of extra services like credit insurance, financing and logistics services. The metalshub operations team is staffed by experts that have worked in the sector and, as a result, are able to offer logistics services along the entire metals value chain including-
- Customs clearance
- Fiscal representation
- Inspection services
Targeting smaller players, the platform will have a soft launch and is aimed at providing value add for these types of entities. The initial geographic focus will be on deliveries to Europe, whereas the source of material can be anywhere in the world. Official go-live will be by the end of 2017. Registered users can start tenders or place bids or offers in response to a tender. Product categories that are initially tradable are Boron, Chrome, Manganese, Molybdenum, Nickel, Niobium, Silicon, Titanium, Tungsten and Vanadium.
Another interesting aspect of the initiative is that it is looking at blockchain for the future currently in two areas – ownership transfer and bills of lading.
We will stay in contact with metalshub and bring an update once the platform is in operation. Meanwhile, you can find more details at www.metals-hub.com