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Surcharge Policy
Surcharges are calculated for each Latrobe Specialty Steel alloy based upon a
complicated formula utilizing the chemical composition of the alloy, the
effective non-coverable yield from melt, and the delta between the 1999 base
values and the current market values. Surcharges are applicable at time of
shipment unless otherwise stated at order entry.
Current market values are obtained from various industry publications as
stated on the historical elemental graphs. The RMS calculation is based upon a three month rolling average of these elemental prices with a one month lag. For example, the January surcharge is based upon the elemental monthly averages for September, October & November. In the event that raw material prices fluctuate more than ± 10% from the previous month, Latrobe Specialty Steel utilizes the one month value.
Surcharges on items purchased from finished inventory programs are applicable at order entry, provided that material is readily available and ships immediately.
For mill-make and ship orders or items in inventory with a delayed shipment,
surcharges are applied at the time of shipment. In the event that the Latrobe
Specialty Steel misses our acknowledged promise date, the customer will be
invoiced the lower of the surcharge values of when the order was promised versus when the order actually ships. Essentially, the customer will not be penalized on mill-make orders in the event that Latrobe Specialty Steel fails to meet our acknowleged promise date. However, if a customer fails to take material upon completion of the mill processing, Latrobe Specialty Steel reserves the right to invoice the higher of the surcharge values of when the material was ready to ship versus when the material actually ships.
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