NEW YORK North
American stainless distributors expressed doubt that a system
to implement a daily alloy surcharge pricing mechanism, such as
Outokumpu Oyjs model in Europe, would succeed in their
Outokumpu said Nov. 1 that the pricing model, introduced via a
pilot scheme this past summer, would be introduced and cover
all European orders starting Jan. 1. The company said the
system will enable customers to "flexibly decide whether to fix
the alloy surcharge on the order date or on any other date
between the order and midweek prior to the delivery week."
While there has been
no indication that Outokumpus North American subsidiary
or any other stainless producer would implement a similar model
in the North American market, U.S. and Canadian stainless
distributors told AMM they had doubts whether the
system would succeed in North America.
"I think it brings too
much instability in the marketplace. ... Id be very
surprised if it was accepted here," one distributor said.
"It could go with you
or against you. ... If you do things right and buy at the right
time, you could have a very competitive advantage in the
marketor a disadvantage, for that matter. I think it
would result in a wider spread in pricing for the market," a
second distributor said.
"Ive heard very
little talk about it," a third distributer said. "A lot of the
stuff (in Europe) doesnt work over here. Its
probably just Outokumputheyre not having the best