Since November 2016, North American Stainless (NAS) has used the European Ferrochrome Benchmark (“EUBM”) as the public index used to establish the purchase price of chrome and subsequently the value used to establish the chrome portion of the alloy surcharge. On May 20, 2024, it was announced that the “EUBM” would be discontinued, forcing NAS to define a new mechanism to establish both the buy price and the surcharge value.

After several weeks of discussions with our supply base, a solution has been identified by utilizing the percentage change of two different indexes. Their historical movements align closely with the now former “EUBM”, to follow the market trend.

The referenced indexes used to monitor chrome price change:
● Index A: The mid-point of the Ferro-chrome, high carbon, 6-8.5% C, basis 60-64.9% Cr, max 3% Si, cif Europe, $/lb Cr
● Index B: The mid-point of the Ferro-chrome 50% Cr import, cif main Chinese ports, $/lb Cr

The chrome price for the surcharge will remain a quarterly value and will be set using the prior quarter’s price multiplied by the percentage change of the two price indexes listed above. For example, the NAS Q3 price will be set by looking at the average of Q2 prices versus Q1 of each Index. The percentage change of each Index will then be averaged together and multiplied to the actual Q2 price to determine the Q3 price.
See Fig. A (values) and Fig. B (calculation) below.

image 10

Last, the reference values for Index A and Index B will be established by utilizing the average of published rates during the following periods.
Q1 — December 21st through March 20th
Q2 — March 21th through June 20th
Q3 — June 21st through September 20th
Q4 — September 21st through December 20th

This change will take place effective July 1, 2024.

Please contact your Regional Sales Representative should you have any additional questions.