The evolving changes in the aluminum prime and scrap market,increased premiums
and higher freight costs drive the need to change pricing structure for rolled aluminum products
Mt. Holly, S.C. (June 28, 2012)– JW Aluminum today announced a new pricing structure that will better position the company to serve customers and meet their worldwide supply needs for rolled aluminum products.
“Due to significant changes in the non-controllable input coststhat impactthe supply of raw materials, higher freight cost and increased premiums, JW Aluminum must think differently in how the company operatesas a leading supplier of rolled aluminum products that brings high-quality aluminum products to the market,” said Chester Roush, chief commercial officer with JW Aluminum.
The new pricing structure will still use the Midwest Transaction Price, but JW Aluminum will now include a Metal Adjustmentto reflectthe different non-controllable costs, such as any new industry raw material costs over and above the Midwest Transaction Price and additional costs associated withthe higher demand for scrap input material. In addition, JW Aluminum will move to a pre-pay billing policy for freight costs on all shipments. The new policy means customers will now have the option to ship their orders using the company’s pre-pay method or make other arrangements to ship their orders at their own expense. Going forward, the company will adjust its fabrication price since it will no longer include freight costs.
The company’s new pricing structure,which is scheduled to be rolled out in the fourth quarter of 2012, will be depicted to our customers in the following manner:
Metal Price $_____ (Midwest Transaction Price)
Metal Adjustment – Non Controllable $_____ (Premium or discount, other metal input cost)
Fabrication Price $_____ (Conversion related cost)
Freight Price $_____ (Transportation cost)
Total Price $_____
Roush continued, “JW Aluminum is committed to reducing its overall costs through our continued lean transformation, which helps minimize, where possible, the impact raw materials and logistic costs are having on our rolled aluminum products.”
JW Aluminum expects the new pricing structure to become effective in two phases as follows:
− Phase 1 - Effective with all new orders entered or after July 14, 2012, a Metal Adjustment of 5 centswill be implemented for all alloys.
− Phase 2 - Rollout and implementation of a new pricing structure will be made in the fourth quarter of 2012.
“JW Aluminum is committed to ensuring customers have what they need, when they need it and at a competitive price,” said Roush. “Our goal and strategy is to become the leading aluminum rolled products company in the world. In doing so, we must recognize the changing dynamics of the aluminum business and change how we operate to ensure JW Aluminum remains a long-term, viable supplier to our customers throughout the world.”
About JW Aluminum
JW Aluminum manufactures specialty flat-rolled aluminum products including “fin stock” used by the heating and cooling industry, light gauge converter foil for the flexible packaging industry, honeycomb foil for the aerospace industry, bare and painted sheet products for window coverings and the building and construction markets, and other foil and sheet products. JWA operates plants in Mt. Holly, South Carolina; St. Louis, Missouri; Russellville, Arkansas; Jackson, Tennessee and Williamsport, Pennsylvania.
