• Flow case studies, Cash management, Trade Finance

    On the right track

When Jeremy Hamon took Primetals Technologies into a four-year ESG-aligned FX hedging commitment, the finance and treasury function brought the entire steel engineering business on board to ensure it performed to agreed criteria. flow’s Clarissa Dann explores the remarkable journey

As Head of Group Finance for the steel engineering firm Primetals Technologies at only 34 years old, it would be fair to say that Jeremy Hamon has enjoyed a meteoric rise up the career ladder to date.

His family are from Pontoise, a small town north-west of Paris that was one of the centres of the Impressionist movement in the 19th century. From a young age, he was immersed in the heritage of painters such as Vincent van Gogh and Camille Pissarro, who lived in Pontoise between 1872 and 1884.

Hamon continues to think in stories and pictures. They have helped him tackle the most complex of operational tasks in finance, he explains – the most recent achievement being the ongoing implementation of an entire corporate treasury system and operations into Japan’s Mitsubishi Heavy Industries, Primetals Technologies’ main shareholder.

This article takes a closer look at not only Hamon’s remarkable career trajectory, but also profiles a pioneering steel engineering company that has aligned itself with the demands of the future. Climate change has become a clear megatrend in the steel industry, while customers demand advanced steel grades for higher performance. In response, the company has built a comprehensive portfolio able to combine both requirements. This focus on sustainability and technology is now a cornerstone of the company’s financial management, with its landmark hedging concept linking currency options to sustainability goals.

In the beginning

“As a child I wanted to become an engineer in mobility because I loved the idea of making travel convenient – as you know, infrastructure is all about people”
Jeremy Hamon, Head of Group Finance at Primetals Technologies

Our meeting would normally have taken place in Linz in Austria, where Primetals’ main operation is based. Hamon commutes in from Vienna. But instead of meeting for a tour of the works, we are in video- conferencing mode. Despite the limitations of two-dimensional rather than three-dimensional interaction, Hamon’s passion and enthusiasm shine through.

“I grew up in a family of entrepreneurs. After Algeria gained independence, my mother’s family had to leave what was a French colony quite suddenly. My grandfather arrived in France with nothing and set up a successful retail business,” he recalls.

Hamon’s father worked as an accountant in the Paris-based mobility sector of German engineering conglomerate Siemens, thereby engendering an early curiosity in transport infrastructure. For many years he believed his father “worked on trains”, unaware that he held a finance role. “As a child, I was fascinated that my father was part of all this. I wanted to become an engineer in mobility because I loved the idea of making travel convenient – as you know, infrastructure is all about people.”

To the chagrin of his mathematics teacher, Hamon opted for a degree in political sciences at the Institut d’études politiques de Paris (often known as Sciences Po), the alma mater of many a French president, including current incumbent Emmanuel Macron. This was the right place for Hamon, given his sense of, and passion for, the wider collaborative and collective post-national approach to Europe after the fall of the Iron Curtain. “Cosmopolitanism is an individual state of mind,” he reflects.

An MA in public affairs and social studies at Sciences Po between 2007–2009 followed on from his three-year bachelor degree. He speaks six languages including Czech and Polish, the latter having been honed as part of a year abroad spent at the University of Warsaw during his undergraduate studies. Then, with his heart set on a public-sector career, Hamon took a government internship in the cabinet of the Minister of Interior (Home Secretary), continuing as an employee. But he found politics failed to inspire and he grew frustrated at having to support a person rather than a purpose in such a role.

It was time to leave France. Although tempted by the US, he chose the shorter trip across the Channel for the next stage of his career. “I joined Siemens UK in a junior financial consulting role and moved to Guildford,” he recalls. As it happened, as part of his UK-based responsibilities, he had to support reorganising Siemens’ finance functions in South West Europe (including France). This resulted in the somewhat surreal experience of having to train and develop the team that would make Hamon Senior redundant, as financial functions became centralised across the company. Hamon adds: “He wanted to retire anyway, so it all worked out! My father jokes that he had supported me financially during my studies, only for me to get rid of him when I got started.”

Hamon flourished at Siemens. “My first boss in the UK was a real mentor and he let me do as much as I was capable of. So I wanted to repay that trust by exceeding his expectations.” Eventually that led to a relocation to the firm’s Munich headquarters as a foreign exchange (FX) specialist to support the roll-out of new systems and processes. “During the time I was in Munich, I was training people in Siemens – over 500 employees around the world – on foreign currency. This was to prepare them to become currency managers and take care of the currency risk for their part of the company.”

Rise of Chinese steel production

As Hamon notes, in the 21st century the steel industry has been dominated by China’s rapid emergence as the world’s major producer. Once China had opened up its economy with the 1978 market reforms and grown within the World Trade Organization, subsequent industrialisation and urbanisation saw huge amounts of investment in infrastructure, buildings and machinery. “In the 1990s, China’s path in global crude steel production was negligible, but nowadays, it accounts for half the global output,” he observes. According to the World Steel Association, China’s production of crude steel (steel in its first sold or usable form such as ingots, slabs, and liquid steel for castings) in 2020 when overall world production reduced by 0.9%.

Figure 1: Production of global crude steel 2013-2020 (million tonnes)

Source: World Steel Association

Chinese steelmaking capacity was helped by the government granting steel companies independence from state control and allowing them to invest heavily in expansion. In addition, the opening up of China in the 1980s and 1990s to foreign direct investment and trading partners allowed the country’s steel producers to gain vital access to modern technology.

Unfortunately, with such expansion came the coking coal that fired the furnaces –
the environmental damage not having fully registered at the time. “The Paris Agreement was 20 years too late,” sighs Hamon. In December 2020, S&P Global reported that steelmaking is China’s largest consumer of energy. It cited a Ministry of Ecology and Environment report that also deemed the sector to be “the largest source of pollutants”.1

The 2000s were a “golden age” of growth for steel producers, but a rate that once averaged around 7% has now plateaued, according to Hamon. “It’s the first time ever that the growth in GDP and steel market growth has not correlated,” he adds. China overproduced and utilisation went from 85% to 70%, so now the global market is flooded with commodity steel – killing off many plants that became unviable. The UK steel industry was a particular casualty. A visit to the northern England city of Sheffield, where Primetals still employs technology experts, brought this home to Hamon, who before joining the company would have only related the ‘Steel City’ to the British cult comedy The Full Monty.

Steelmaking is a capital-intensive market and Hamon points out that many customer EBITDAs have fallen to below 10%. “It’s really hard for steelmakers to stay afloat as it is a very capital-intensive market. You need to build heavy infrastructure to produce.” While the market is flooded with commodity steel, the segment with sustained demand (not exceeded by supply) is the flat product requiring high levels of alloys for highest performances.

Birth of Primetals Technologies

As the steel industry entered the current low-growth environment, it was clear that future success depended on the right partnerships and market differentiation. Primetals was launched on 7 January 2015 as a joint venture between Siemens and Mitsubishi Heavy Industries, once the two engineering giants agreed to combine their strengths from a geographical and market-positioning perspective. From the very beginning, Hamon was put in charge of the Group Treasury for the new group.

The Linz-based operation, having developed its technology over decades after reconstructing what was Europe’s largest steel plant after the Second World War, specialised in the upstream business – processing iron ore and creating the alloys (while prioritising emissions control). The Japanese side was mainly downstream – the rolling and processing which defined the high quality of the end-steel product. “It would have been strenuous for each company to subsist on its own and even compete,” adds Hamon. “And at the end of the day the steel business is mainly domestic, as it is mostly made and delivered in the country that needs it directly. Hence our geographical coverage created synergies. Providing what amounted to a service business on site, we reached a large proportion of the global market.”

In October 2019, Mitsubishi-Hitachi Metals Machinery, a Mitsubishi Heavy Industries group company, announced it would acquire the Siemens stake in Primetals, and the transaction was completed at the end of January 2020. Although the firm’s headquarters are in London, Primetals’ treasury operations are mostly run from Linz in the aftermath of Brexit. Hamon, who had already been structuring an integrated treasury operation as Head of Group Treasury, was then additionally made CFO of Primetals Technologies Treasury in February 2018, before becoming Head of Group Finance in December 2020. Once the company was wholly owned by the Japanese firm, he found himself having to centralise the treasury operation.

“They placed a lot of trust in me. Every day I learn a tremendous amount from Japanese culture, such as the dedication people bring to their company,” he reflects.

Implementing treasury

“There was nobody and nothing in place – I was asked to implement a treasury management system in as lean a setup as possible, while having to reach best-in-class standards”
Jeremy Hamon, Head of Group Finance at Primetals Technologies

Back in early 2015, when Hamon began building the Primetals treasury up from scratch, he was effectively given a blank sheet of paper. “There was nobody and nothing in place, as everything was centralised in Siemens, with a Siemens-developed system for cash management,” he recalls. “I was asked to implement a treasury management system (TMS) in as lean a setup as possible, while having to reach best-in-class standards.”

Over a five-year period, he took the treasury from “nothing, no people, no bank accounts and no process” to a fully functioning structure that centralises nostro accounts and can handle ESG-based FX trading. Once Primetals was wholly owned by Mitsubishi Heavy Industries in January 2020, he was asked to expand the function to the wider group.

The core treasury team rose from zero to eight, with more colleagues spread across the UK, Austria, Brazil, China and India. Once his role expanded to Head of Group Finance, it brought the numbers up to 30 globally. He installed the BELLIN cloud-based TMS platform because it was “so easy to use”. Customisation followed as the treasury function developed, with BELLIN founder Martin Bellin and Hamon working together (evidenced by a number of engaging videos on the former BELLIN website) on the improvements. “We worked together on building a payment factory and artificial intelligence capability on fraud prevention, as I always try to pioneer as much as possible to get the development that centralised treasury departments need,” he says.

Hamon explains in a BELLIN video, titled ‘Is an in-house bank the right option for you?’, that there are two main points in the in-house banking process:

  • An internal one of mapping one standard payment format in an affiliate to any format required outside; and
  • An external one of sending that format aligned with each bank to the many banks around the world.

Daily routine

What of Hamon’s daily routine for keeping on top of everything? Unsurprisingly for a millennial ‘Generation Y’ professional, the first port of call is his iPhone: “The first two things I see each day on my phone are the cash position and then the FX rates.” While he checks that the company can manage everything it is contracted to deliver, he has to keep on top of the FX risk during a customer journey. At the beginning of a bidding phase for a potential customer project, a price has to be committed. However, Primetals doesn’t know until the end of the bidding process whether the project will proceed. If it does, it is important that the pricing ensures the company is selling within the right range. Otherwise, with FX moving in the wrong direction, the company could end up selling at a loss.

Hamon makes a point of avoiding non-essential meetings, keeping his calendar free for managing exceptions. “I don’t want my day mapped out,” he admits. He also keeps administration to a minimum by ensuring there is just one bank account per currency for the group and that everything runs through that account. “I don’t like bank accounts in general, which is strange for a treasurer,” he smiles. But there is a practical rationale behind it – a small number of banks where the relationship is intuitive, the technology state of the art and the pricing sustainable is much easier to manage, particularly when the main need is liquidity provision and FX services. “It will be detrimental on the mid-run to the quality of the rates we get if there are too many banks all quoting against each other,” he explains. “A bank, at the end of the day, will give us a good rate for a month and after acknowledging the adverse effect will end up adjusting margins accordingly.”

FX needs

Primetals trades in more than 20 currencies on a regular basis, so banks are selected for their strength in each currency and their ability to net their exposures in that respective currency internally. As Hamon notes, “that has an obvious impact on the pricing”. FX structuring expertise is particularly important to him and “really supportive whenever we need more of a deep dive into the strategy we are trying to implement”.

He uses Deutsche Bank’s Maestro on Autobahn platform for routine FX flows traded on the multibank platform. This takes all the reported exposure Primetals has on a group level and alerts Hamon of the FX trades needed to mitigate them.2 

“Just imagine our treasury system where we have many people in the world every day inputting their foreign currency risk,” he says. “They’re adjusting cash flows and timelines because business is moving, customers prolong payments, or we might have to supply earlier than planned. All this data – thousands of lines of it – goes into Maestro, and based on this Maestro tells you that you need to perform these certain currency swaps.” This, explains Hamon, is the essence of managing the liquidity and dealing with non-strategic hedging.

A typical case where he would turn to the FX Structuring team at Deutsche Bank for strategic input would be when deciding whether to bid or not bid on a project. “Suppose we bid on a project in Mexico with a customer and the rates move against us because of Covid-19; we end up signing a project that is lossmaking from the outset. So we need to deal with this and potentially hedge ourselves with optionality accordingly.”

Climate change

For Hamon, there are two megatrends in the steel industry: digitalisation and sustainability. Crude steel production makes up 8% of global greenhouse gas emissions. However, even if it became possible to extract it with zero emissions, iron ore still has to be got out of the ground, he adds. Two disasters in Brazil highlight the environmental and social costs of getting iron ore extraction wrong.3

In 2015, the collapse of the Fundão tailings dam, which was holding millions of litres of wastewater from an iron ore mine, devastated the local area and polluted the water supply for hundreds of thousands of people in the region, while the Brumadinho dam disaster in 2019, which ranks as Brazil’s worst industrial accident, resulted in the deaths of 270 people and destroyed an entire village.

Everyone wants stronger alloys for steel, so mining is not going to go away – but it needs to be done more responsibly, Hamon stresses. “Until a few years ago, the availability of scrap steel for recycling was still low in China, while most production required freshly mined pig iron, but now more steel can be used from scrap on more environmentally friendly solutions.”

This is helpful but falls short of fully meeting demand. As analysts Wood Mackenzie put it, “Virgin ironmaking is emission-intensive, so the first logical step to reduce emissions is to reuse available scrap. But scrap cannot meet all metallics requirements – stock is limited, collection infrastructure is fragmented, and scrap quality can restrict recycled steel’s use.”4

Figure 2: Virgin iron production and raw material demand (million metric tonnes)

Source: Wood Mackenzie

The Wood Mackenzie analysis goes on to explain how “the two main ways to produce iron will follow different paths to decarbonisation”:

  • Smelting. But because coal is an integral part of the process, emissions are unavoidable and technology development is focused on the capture and re-use of CO2;
  • Direct ore reduction using gas. Synthetic gas and natural gas have long been used in these processes, but the focus has now shifted to the use of hydrogen, which offers near-zero Scope 1 emissions. However, at the moment it is a trade-off with higher Scope 2 emissions from hydrogen produced from natural gas.
    “Low-carbon hydrogen will have to scale up massively before it can offer meaningful emissions-reduction in the steel industry.”

In summary, the Wood Mackenzie analysts reflect that “steel decarbonisation will be a technological evolution where three levers will come into play – scrap, alternative ironmaking and carbon capture”. Hamon returns to his observation that the Paris Agreement was 20 years too late. If the environmental impact had been considered before China’s boom in steel production, technological expertise could have found a way to build zero-emissions steel plants if supported by the right financial incentives for steelmakers. Right now, he adds, there is clearly insufficient green hydrogen,5 but this could change when the cost of production comes down.

The opportunity to be part of this solution is something Hamon finds very exciting:
“As a technological provider, we are ready to support steelmakers.” But to do this, there needs to be more regulatory support. While the EU Taxonomy is, in his view, “a really good move” and “financial players are facing responsibilities and identifying what is ESG and what is not in terms of what they support”, greening steelworks is currently still a greenfield project.

Aligning ESG to FX hedging

When Deutsche Bank approached Primetals to outline what would become the world’s first hedging concept that links currency options to sustainability goals, Hamon jumped at the opportunity. “I took this as a personal challenge,” he enthuses. Signed on 5 November 2020, the framework agreement enables Primetals to hedge its currency risk with FX options with Deutsche Bank over a four-year period.

If the company fails to meet the agreed sustainability targets, Primetals Technologies pays a predefined sum to a contractually defined non-government organisation. Any currency hedges executed by Primetals must comply with the criteria of the new Sustainable Finance Framework that Deutsche Bank published in July 2020. This sets out the classification of ESG financing, which is aligned on a best-effort basis to the EU Taxonomy Regulation.6

The targets – in this case framed by Sustainable Development Goals 9 and 13 – were developed in consultation with external independent consultancy Environmental Resources Management, which will be monitoring Primetals’ ambitious targets, with a remit to annually assess whether or not the targets have been met. Hamon explains these targets are mostly “share of green technology sold expressed in percentage of total order entry” and “research and development expenses on green technology”.

The process of getting buy-in for the deal, says Hamon, helped bring about more cohesion and purpose in not only his own treasury team but also within the wider team: “Although we know our technology, a lot of us didn’t know how to quantify in sales terms for example how green – or not – the products are that we were sending to customers, so going through this exercise was hugely beneficial.”

When he was in discussions with Deutsche Bank Corporate Bank’s CFO and Chief Sustainability Officer, Gerald Podobnik, they agreed that every corporate banking product could prompt this sort of initiative. “I wanted to somehow convince other treasurers they could take this step and engage their finance organisation in this sort of commitment,” Hamon says.

“We plan to develop more and more financial products that are linked to sustainability targets,” said Podobnik when the deal was announced. “In so doing we will assist clients like Primetals Technologies in implementing their sustainability strategies and monitor their achievements over the longer term.”

Hamon had to manage nervousness about what could happen if key performance indicators were too ambitious for such an industry and encountered reputation risk as a listed Japanese corporate, as reputation matters more than the financial benefit of the scheme. And although Primetals can’t position itself as a green technology business entirely, it can demonstrate that it helps its customers deliver energy savings in their transition to greener steelmaking. “We are on the right track,” he says modestly.

Hamon’s concluding railway metaphor seems rather apt given his early interest in trains and transport infrastructure, and the fact that Primetals has been instrumental in engineering machinery that is producing long-rolling products forming many of the world’s railways. With Hamon in the driving seat, it’s clear that Primetals’ Treasury team is travelling firmly in the right direction.


See https://bit.ly/3evH6gV at spglobal.com
2 See https://bit.ly/3b9vJud static.autobahn.db.com
3 See https://cnn.it/3vem8Ka at edition.cnn.com 
4 See https://bit.ly/32KrmRD at woodmac.com
5 For more on green hydrogen, see https://bit.ly/3dL1lbe at flow.db.com
6 See https://bit.ly/3xlB8I0 at db.com

Stay up-to-date with

Sign-up flow newsbites

Choose your preferred banking topics and we will send you updated emails based on your selection

Sign-up Sign-up

Subscribe Subscribe to our magazine

flow magazine is published twice per year and can be read online and delivered to your door in print

Subscribe Subscribe

CV: Jeremy Hamon

December 2020
Head of Group Finance, CFO, Primetals Technologies Treasury, Linz (Austria)

February 2018
CFO, Primetals Technologies Treasury, Linz (Austria)

January 2015
Head of Group Treasury, Primetals Technologies, London (UK)

Associate Senior Risk Consultant, Siemens Financial Services GmbH, Munich (Germany)

Financing Consultant North West Europe, Siemens Financial Services GmbH, Camberley (UK)


Institut d’études politiques de Paris
MA, Public Affairs

University of Warsaw
International Relations

Institut d’études politiques de Paris
BA, Political Sciences


Upstream technologies

  • Iron, steelmaking and eco-solutions: transforming raw material using blast furnaces and environmentally friendly technologies for primary iron and steelmaking
  • Mini mills and long rolling: smaller-focused secondary steelmaking facilities refining scrap steel to the highest standards into long products mostly used in construction
  • Casting and endless strip processing for the production of steel slabs or resource-efficient hot rolled sheets reduced to the lowest possible thickness. Especially used for automobiles

Downstream technologies

  • Hot mills for the thickness reduction of steel slabs into plates used in construction or machinery, sheet metal or rail tracks
  • Cold mill, processing line and pipe mill for the strength, surface finish and tolerance improvements of smaller workpieces used, for example, in domestic appliances or pipes
  • Electrics and automation: automating systems and processes for more efficient and modernised iron and steelmaking
  • Metallurgical services developing lifecycle partnerships for maintaining steel plants



The golden touch The golden touch

Gold has seen its value soar during Covid-19. But what happens when its top-producing countries go into lockdown? Peter Steenkamp, CEO of South Africa’s Harmony Gold, tells flow’s Janet Du Chenne how the company is engaging investors amid the pandemic

The golden touch More


Responsible innovation Responsible innovation

How can you connect four billion accounts across the world in an instant? That is the bold vision of SWIFT’s CEO, Javier Pérez-Tasso. flow's Clarissa Dann talks to him about the responsibilities vested in a cooperative founded to create mutual benefit for the financial community and why a virtual Sibos for 2020 will keep the global financial community engaged

Responsible innovation More


Pharma karma Pharma karma

Novartis is taking bold steps to increase access to medicines and tackle complex global health challenges. flow’s Janet Du Chenne explores how a social bond focuses the pharma company on achieving ambitious targets for getting medicines to low- and middle-income countries

Pharma karma More