NEW ORLEANS Acerinox SA
chief executive officer Bernardo Velázquez Herreros
believes that the European stainless alloy surcharge system
"has passed away," although other stainless steel producers
still see a future for the system.
Madrid-based Acerinox now
primarily uses European surcharges for internal purposes,
although his company is still happy to use the surcharge system
in the U.S. market through its Ghent, Ky.-based subsidiary
North American Stainless Inc. (NAS), Velázquez said last
week at the annual conference of the International Stainless
Steel Forum (ISSF) in New Orleans.
"The alloy surcharge system in
Europe has passed away," Velazquez said.
Philippe Darmayan, chief
executive officer of Luxembourg-based Aperam SA, acknowledged
that customers had questioned the system recently when
surcharges increased as London Metal Exchange nickel prices
"The only thing we say there is
that there a problem in the system," he said. "I am discussing
this with each of our customers, though I think we have
consensus that something is not normal."
However, Clemens Iller,
president and chairman of Terni, Italy-based Acciai Terni
Speciali SpA, said that the European surcharge system could
work more effectively as market conditions improve.
"The alloy surcharge system is
not really the problem; the problem is overcapacity," Iller
said. "It had a very good function in the past, so if we can
solve the one problem, we could see it maintained. It was a
fair way for customers to see what charges on the alloys were,
so Im not against it."
Darmayan acknowledged during the
panel session that the issue is "a delicate subject, and we do