DMCC Steel Club established to foster business opportunities and information exchange

1. New initiative to become focal networking point for steel industry
2. Significance of collateral financing and price risk management  tools highlighted
3. Industry achievements recognised at inaugural Steel Awards

Dubai Multi Commodities Centre (DMCC) announced the formation of the DMCC Steel Club – a dedicated networking association to support the UAE steel industry with identifying business opportunities and exchange of global best practices. The DMCC Steel Club, which was launched at a gathering of steel and financial industry professionals, also highlighted the role of financial tools as being crucial for the industry to better manage price risk, and thereby improve the risk-reward evaluation to steel’s lenders and investors. 

Based on the three pillars of networking, education and industry recognition, the DMCC Steel Club aims to engage the key stakeholders of the steel industry, including manufacturers, suppliers, end buyers, shippers, financiers and brokers. Through regular networking events like monthly breakfasts, workshops and forums, members can gain insights on industry trends and how to provide competitive advantage in procurement, sales, and the fight for capital. Educational themes will embrace structured financial solutions relating to every day applications for collateralised finance, and also price risk management tools like steel futures and swaps. Forthcoming initiatives of the DMCC Steel Club could also include a more in-depth Morning Steel Report and DMCC Steel Indices.

“The setting up of DMCC Steel Club is crucial and timely as it seeks to support industry players in sustaining the momentum of their business growth and realise pricing benefits,” said Ahmed bin Sulayem, Executive Chairman of DMCC. “Along with opportunities to facilitate business, the Steel Club will also undertake educational activities to raise awareness on a range of financial products and risk management aspects for boosting operational efficiency.”

At the launch event, key industry achievements were also recognised through the presentation of the annual DMCC Steel Club awards, 2008. Tariq Barlas, Vice Chairman & CEO, Saudi-based Al Tuwairqi Group, was named “Man of Steel”; Walid Sherif, Purchasing Manager-Steel Division, Madar Holding, was the recipient of the “Emerging Talent of the Year” award; S.R.Rao, Chairman, Middle East Traders, received the “Lifetime Achievement” award while Vinod J. Tellis, Commercial Manager, Petroleum Pipe Middle East, collected the “Deal of the Year” award on behalf of his company for an innovative transaction using the Global Multi Commodity Receipt.

Highlighting the role of steel futures and other derivatives as being crucial for the industry to better manage price risk and improved price discovery, John Short, Executive Director for Steel and Base Metals division, DMCC, said: “There has been widespread interest in the relationship between steel futures, steel swaps, and the physical steel market, particularly with regard to the delivery and the price discovery function. Since its launch late last year, the steel rebar prices on the Dubai Gold and Commodities Exchange (DGCX) have demonstrated consistent mid-90 per cent correlations with long product prices on the primary physical markets of the Black Sea, Middle East, SE Asia and even Far East/Chinese exports. This underlines the capacity for participants of EurAsia’s long product supply chain to use the DGCX Rebar contract for better cash flow management and improved access to finance.”

About DMCC
DMCC was created in 2002 as a strategic initiative of the Dubai Government to establish a commodity marketplace in Dubai. Rated ‘A’ by Standard & Poor’s, it provides the market infrastructure that brings together a wide range of commodities activities, and is committed to serve the needs of participants in the gold, diamonds and commodities markets. Resident companies of DMCC are offered highly attractive benefits under a free zone status, including a 50-year guaranteed tax holiday, 100 per cent business ownership, full ownership of business premises, and a secure regulated environment.

For further information, please contact:
Anusyia Nathan / Sudha Hemmad / Nicholas Nesson
ASDA’A Burson-Marsteller
Email: a.nathan@asdaa.com / s.hemmad@asdaa.com / n.nesson@asdaa.com