Material charge - steel scrap market price fluctation indicator

Raw material surcharge (also Material charge) is a charge
invoiced per net kilos delivered in addition to confirmed
fixed casting sales price.

The cost of scrap metal and iron ore materials is a major part of foundry production costs. Prices of these materials are volatile and related to actual to the market demand for these materials and prices are revised on a monthly basis. Therefore, it is not possible to fix the prices for a longer period.

In order to avoid frequent recalculation of casting prices and to provide customers with transparency in the formation of prices, the above price fluctuations in your invoices showed as a separate line as Material charge.

Scandicast Material surcharge could be calculated and applied on invoice day, when real material costs used in production are known. By default castings we produce four weeks before moment of sale so as references for calculation we take material prices used in month of production.

As the time gap from the moment order confirmation to production can be from several weeks to several months, we are unable to provide you with exact value of the Material charge.

Changes to the previous material surcharge index are applied if the fluctuations exceed the +/- 5 limit. If the change is less, Scandicast keeps Material surcharge unchanged.


Important ! 

Material charge changes from 29/04/2022 :

    Last year's events and high activity in the industry have affected the prices of foundry materials for several quarters in a row. It has also had a significant impact on our production costs. In fact, there are no production costs that have not increased in recent months.

   In order to ensure the availability of raw materials and a stable production process in the coming months, for all deliveries from May 2022 the material surcharge will be increased by 0.195 EUR / kg.

This is a temporary solution that would guarantee deliveries in the ordered quantity and promised time.

CAEF index

As a basis for material surcharge costs, we use the CAEF (The European Foundry Association) price index, which represent the price of different materials in each month. 

This information is publicly available and is updated on the 15th of each month. More details >>>

CAEF price components:

  • average of the light steel scrap (25%),
  • heavy steel scrap / rails 40 cm (25%)
  • packages 30x30x30 cm (25%)
  • pig iron (25%)