Back to News ReleasesWCI STEEL, INC. ANNOUNCES RAW MATERIAL SURCHARGE
WARREN, OHIO, April 3, 2008 -- WCI Steel, Inc., announced today that, because of significant increases in basic raw material and energy costs, it will implement a raw material and energy surcharge on fixed-price long-term supply agreements. The surcharge of about $130 per net ton will become effective with shipments April 16, 2008 through May 31, 2008.
“Strong global demand for steel products coupled with changes in currency valuations have led to a widely publicized escalation in basic steelmaking input costs,” said David A. Howard, WCI Steel’s Vice President, Commercial. “The unexpected and rapid rise in the cost of these raw materials can no longer be absorbed and must be passed through the supply chain, just as we have passed along these costs in the form of price increases to our spot and indexed prices customers who constitute about 80 percent of our sales.”
WCI Steel stated that rapidly rising metallurgical coke, scrap, iron ore and natural gas costs have strained its ability to maintain these fixed-price customer agreements. “The raw material and energy surcharge will be a cost-based surcharge designed to maintain the negotiated margin structures of these agreements,” according to Mr. Howard.
The surcharge will be based on the rate of escalation in costs since the fourth quarter of 2007. Any additional increases will be calculated on a month-to-month basis.
About WCI Steel, Inc.
WCI Steel’s strength is built on “Custom Steel. Custom Service. Creative Solutions.” As a niche-oriented integrated producer of value-added, custom steel products, WCI Steel emphasizes customer and technical service. WCI Steel currently produces 185 grades of flat-rolled custom and commodity steel products at its Warren, Ohio, facility. WCI Steel focuses on a wide range of custom flat-rolled steel products, including high carbon, alloy, ultra high strength, and heavy-gauge galvanized steel and on developing closer, more responsive relationships with customers. Major customers are steel converters, processors, service centers, construction product companies, and, to a lesser extent, automobile manufacturers.
Bette Kovach
Public Affairs
WCI Steel, Inc.
999 Pine Avenue, SE
Warren, OH 44483-6528
330-841-8213
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