Surcharges

Outokumpu Alloy Surcharges

The total price for stainless steel is divided into three parts; the base price, extras and alloy surcharge (AS).

The Base price is negotiated individually with each customer and is separated from volatile alloy price movements (in order not to be fluctuating daily). Base prices are usually negotiated on a monthly basis.

Extras describe material-specific charges for non-standardized product dimensions and are added or deducted to/from the base price. Typical extras are applied for special thicknesses, surfaces, packaging, etc.

The Alloy Surcharge (AS) is an instrument to pass on changes in alloy costs along the value chain in the stainless steel industry. Alloy Surcharges are product-specific as alloy compositions differ within the range of grades and calculation periods may be different.  Monthly average calculation has been the industry standard, i.e. the average alloy costs of a fixed period prior to the delivery of the product was applied to determine the alloy surcharge. Alloy surcharges are usually published month by month.

Daily Alloy Surcharge price models for European customers

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Outokumpu introduced the Daily Alloy Surcharge pricing models for European customers in 2014. Daily alloy surcharges are published on our web site from Monday to Friday at 8 a.m. CET.

Daily Alloy Surcharge benefits

  • Stabilized order management: Unbundling of ordering date and Alloy Surcharge fixation allows ordering today and fix the AS later
  • More influence: Alloy Surcharge fixation period can be chosen by you
  • „Back-to-back“ pricing: Comprehensive toolset to offer effective pricing
  • Flexible average: Nearly the whole period from order to delivery as well as only one day can be taken as AS average
  • Metal opportunities: Alloy Surcharge calculation period can be determined individually allowing metal gain optimization

 

Learn more from Daily Alloy Surcharge brochure.

Jul 25, 2018