Surcharges – Frequently Asked Questions

What is a material surcharge?

Shortages of particular raw materials, such as Nickel, create price fluctuations in the marketplace. As the prices of these raw materials increase, stainless steel producers assess surcharges in order to recover these additional costs. Instead of adjusting existing pricing or contractual agreements, these costs are passed on as surcharges.

How does American Stainless Tubing calculate surcharges?
Surcharges are derived directly from the Allegheny Ludlum Steel Corp. website.

Which surcharge applies to my order?
Surcharge takes effect at the time of shipment. If your order is placed in January, but shipped in February, then the February surcharge would be the amount applied to your order.

Does American Stainless Tubing add a “scrap factor” to the surcharge?
No, American Stainless Tubing does not add a scrap factor. Surcharges are assessed as they are shown on the Allegheny Ludlum Steel Corp. website.

Which 304 and 316 surcharge does American Stainless Tubing use?
Surcharges are assessed based on the percentage of raw materials contained in the stainless steel product. American Stainless Tubing uses the 304/304L and 316/316L surcharge listed on the Allegheny Ludlum Steel Corp. website.

How does American Stainless Tubing assess surcharges?
Surcharges are listed as a separate line item on your invoice. This allows us to maintain an accurate sales price history in our computer system and a more accurate invoice for our customers. If you require the surcharge added to the sales price and displayed in one line item, please discuss this with your American Stainless Tubing Sales Person.

When will surcharges go away?
It’s difficult to say. The price fluctuations in the raw materials used to make stainless steel determine whether surcharges are assessed. As long as the market prices of these raw materials stay above the trigger price, surcharges will continue to be assessed. Currently, the trigger price for Nickel is $2.00 per pound. For the current market price of Nickel, please see the next question. In addition, this link from Allegheny Ludlum Steel Corp. lists the trigger prices of FerroChrome, Nickel, Molybdenum, and Iron, which affect the 304 and/or 316L surcharges. http://www.alleghenyludlum.com/ludlum/pages/SurchargeCalculator/SurCalc.asp?type=Steel

Where can I find today’s price of Nickel?
http://www.metalprices.com lists the current market price of Nickel as well as prices for other raw materials.