Universal Stainless & Alloys Products (USAP) announced today increases to the nickel premium used in calculating surcharges for the metal, starting in May.
The nickel calculation for material surcharges will change from $0.38/lb to $1.70/lb for argon oxygen decarburization (AOD) and $2.70/lb for vacuum induction melting (VIM). The announced change will go into effect for May surcharges, which reflect the raw material costs for March, the company said.
London Metal Exchange three-month official prices surged by 47pc, or $13,475/t, to $42,150/t today, just under the highest daily increase, which was set on 2 January 2008. The three-month price was last seen at these levels in March 2007.
The recent run-up in the cost of nickel was attributed to sanctions leveled on Russia because of its invasion of Ukraine. Russia accounted for 9pc of global nickel mine production in 2021, according to the US Geological Survey. Nickel supply tightened in the lead-up to the conflict in Ukraine, in part because of growing demand from the electric vehicle sector as US consumers are increasingly focused on securing supplies to meet production requirements.
USAP has adequate annual contracts in place to secure nickel for all its melting requirements, the company said.
