SCM nixes two-week pricing system plan

Dec 09, 2011 | 02:50 PM | Suzy Waite

Tags  Service Center Metals, R. Randolph Weis, two-week pricing, prior month pricing, Midwest average, billet, extrusions, LME Suzy Waite

NEW YORK — Aluminum extruder Service Center Metals LLC (SCM) has backtracked on plans to shift to a two-week pricing mechanism from a prior-month system after the proposed adjustment failed to garner sufficient industry support, AMM understands.

The Prince George, Va.-based company had announced in a Nov. 22 letter to customers its plan to implement a pricing methodology based on a two-week Midwest average effective Dec. 15 to counter increased pricing volatility in an environment of shorter lead times.

However, it retracted that plan in an e-mail to customers Friday, noting that despite significant customer support the proposed mechanism may have created some challenges.

"In advance of this adjustment, we spent a great deal of time in face-to-face meetings with our customers discussing this concept and, as recently as this week, the large majority of you have indicated support for this move," R. Randolph Weis, vice president of sales and marketing at SCM, wrote in the Friday e-mail to customers.....