The alloy surcharge is a monthly per-pound charge set by the steel mills to reflect current market prices for the raw materials in each grade: nickel, chromium and molybdenum for stainless steel, and scrap and iron for carbon steel.
It covers raw material costs only. It is not a fuel, freight or energy surcharge.
Why there’s a surcharge at all
The raw materials in stainless steel, nickel especially, can rise and fall sharply in price from month to month. Instead of changing their base prices every time the market moves, the mills keep a steadier base price and add a surcharge that follows the market. The price per pound is the two added together:
Price per pound Base price + alloy surcharge
Why it changes every month
The mills set a new surcharge each month based on recent market prices for those raw materials. When nickel or chromium prices go up, the surcharge goes up. When they come down, so does the surcharge.
Why it’s different for each grade
Each grade contains different amounts of these materials, so each grade has its own surcharge. For example:
- 316 / 316L contains molybdenum and more nickel than 304, so its surcharge is usually higher than 304’s.
- 430 contains chromium but almost no nickel, so its surcharge is usually much lower.
- 1008 / 1010 carbon steel has none of these alloying elements. Its surcharge follows scrap and iron prices instead.
Where to find the current surcharges
We post the current month’s surcharges on our Surcharge page.