An interview with a Steel Trader

Name: Andrea Lazzaroni

Job Title: Steel Trader / Director

Company: Duferco

How long have you been in Commodities?

15 years now

How did you get into the commodity markets?

I became fascinated with the global commodity markets through university, studying international economics, exchange rates and protectionism.   It was a lucky situation after my studies.  I was working in France when I was 24 and was in contact with a couple of guys in trading.  They offered me a junior role with the firm.  The key to getting into the markets was building relationships and speaking to people through my studies.

What is the core purpose of your current role with Duferco?

We back to back trade, dealing with all of the sourcing, storage, stocking, sales and delivery of flat and long steel products.  Primarily I trade the European markets, with some non EU business.

How relevant do you feel your education was in your latter career?

My university studies gave me a good headstart on terminologies and the dynamics of global markets, allowing me to pick up the concept of steel trading quickly.  You can pick up physical trading without this, if you have a good mentor and someone to help you in the learning process, but my studies helped me in understanding the markets from early on.

One of the key things during my studies that has really helped, and I would recommend to anybody looking to go into trading, is languages.  I studied 4 languages in my time in education which really helps build personal relationships with people at mills, suppliers, customers etc. which is critical in a competitive market. If I was picking languages for my business to learn? French and German for sure.

What is the most enjoyable part of your Steel Trading role?

The markets are constantly changing.  The changes in market conditions are changing at a quicker and more dramatic rate all the time whilst the product has almost remained a constant.  Having to adapt to different financing models, and improve service levels to compete and gain a competitive edge gives the most enjoyment.  Travel too; being able to go and meet people in different regions is great.

What are the biggest pressures you face?

You cant make mistakes.  Margins are low and there is little room for error.  Back when I started we had much higher margins and a mistake could be rectified through discounting trades and offering something to keep the customer onboard and make good on any issues.  Now days the margins aren’t there like they were – you have to be hot on it all the time, making sure everything is correct and nothing goes awry.

What has been the funniest/strangest moment trading steel?

We lost a ship with 40,000 tons of steel onboard once.  We called the captain, he didn’t answer.  We couldn’t find it anywhere, the captain wouldn’t come back to us and we did not know where it was.  Eventually we got through to the captain but it was a rather stressful moment at the time.  Now it is funny, back then it was a hell of a panic.

Also had a ship stuck in ice for months in port once.  That was awkward.

What piece of advice would you give to trainees, graduates or juniors looking to go into the commodity markets?

Learn the languages, even if English is your native language.  Be curious and critical; challenge processes and why things are done the way they are, challenge the norms and look for innovation.

How would you sum up your time in commodities in 3 words?

Challenging, Personally Enriching, Fun