What are the elements of pricing?
The pricing for any item will consist of a (1) FAB price plus (2) Quantity Charges (if applicable) plus (3) a metal value. They are described in turn as follows:
1. FAB PRICE
The FAB price is the amount we charge for the value-added work we do in our operations in producing your individual parts to the correct dimensional sizes required. It’s the price we charge for our work. You’ll note it stays constant from shipment to shipment.
2. QUANTITY CHARGE
The quantity charge is based on the order quantity that we ship at one time. It is a fee for producing small quantities – less than 2,000 lbs per release. Our mill size equipment requires us to set-up tools, and then run sample pieces and quality check those pieces to assure we are achieving the dimensional requirements of your order. We may go through several iterations of this set-up process before the tooling is properly sizing the tube. The costs associated with this set-up procedure are absorbed when order quantities are 2000 pounds or more, but for smaller quantity jobs, we have to charge an extra amount to recoup them. The quantity “adder” schedule is available from your customer service representative.
3. METAL VALUE
Metal value is determined as “Previous Month’s Average” (PMA) on the date of shipment. It is calculated by averaging the daily spot-price-closings for the calendar month prior to the month of shipment. Therefore, we change metal values 12 times per year – once every calendar month. For example, shipments in calendar November would have metal values based on averaging October market prices. COMEX is the market used for copper metal value, and LME (London Metal Exchange) is the market used for all non-copper alloying elements (zinc, nickel, tin, and lead). The metal value we charge a customer includes a “producer fee” known as a “metal adder”.
What is metal adder?
Metal adder is a fee charged in addition to the actual COMEX and/or LME market prices. The concept of metal adder is a usual and customary business practice for all copper mills. The metal adder pays for costs which all mills incur when they purchase their raw materials. The largest components of these costs are as follows:
1. “Copper cathode premium” is paid to smelters for their refining of the copper ore (daily amount published in the American Metal Market).
2. Transportation/Freight costs to ship the copper cathode plates from refiners to our suppliers’ melting locations.
3. The cost of using supply chain money (like interest paid to a bank for loaning money). We pay our raw material suppliers when we receive their shipments, and then we own the metal for about eight weeks until we receive our customer’s payments to us (two to four weeks of processing time for drawing to finished size, and then four weeks until we receive payments from customers). During this time, our cash is not available to us for other investments, so it’s like we “loan” money to our customers.
The concept of metal adder simplifies the complexity of doing business. Small Tube Products, and other copper tube mills determine FAB prices based on manufacturing (converting or value added) costs. If we attempted to have one single “all inclusive” price, including all of the costs of metal value in our FAB prices (COMEX market pricing, carrying cost, cathode premiums, energy surcharges, transportation surcharges, etc.), then our prices would need to change on a daily basis. To simplify doing business, mills have standardized on a metal adder to help defray these fluctuating costs.
Why does Small Tube Products take exception to the ASTM B75 yield requirement for light annealed (050) and soft annealed (060) tempers?
Although table 1 in ASTM B75, superscript F allows for a light straightening operation, it is our opinion that superscript F is not specific in the desired procedure of straightening. If the tubing is processed with an annealing operation as the last process, the material may not meet 9 ksi minimum. If the tubing is processed with an annealing operation followed by a rotary (or cross-roll) straightening, then the material will meet 9 ksi minimum. Further explanation for your particular product can be provided by STP’s Quality Department.
What is the difference between “lot” traceability and “heat” traceability?
Depending on the manufacturing process and alloy, there are only certain products that can be provided with “heat” traceability. ASTM B-846 “Standard Terminology for Copper and Copper Alloys” provides definitions for “lot” and “heat.” Those definitions are:
LOT – “a collection of like product (i.e. same alloy, temper, and dimensions) produced under uniform conditions from which a sample is to be drawn for inspection or testing, or both.”
HEAT – “a lot of cast product that shares, and can be identified by, a common chemical analysis result.”
Small Tube Products’ default traceability is by lot. If heat traceability is required, the customer should ask our STP customer service representative if heat traceability is available for the product they are requesting. If so, the STP customer service representative can appropriately plan for that level of traceability. If not planned initially, heat traceability will most likely not be available after the manufacturing process is started.
Further questions regarding heat traceability may be directed to an STP customer service representative or the STP Quality Department.
What are the working and bursting pressures for the tubing I desire?
See the “Safe Working Pressure” calculator on this website.
Who may I contact with questions regarding a certification report I received?
You may contact either your Customer Service Representative or the STP Quality Department.
Who should I contact regarding receipt of suspect material?
You may contact your STP Regional Sales Manager or your Customer Service Representative. They will pass along the necessary information to our Quality Department.
If I have samples to be returned for analysis, what is the ship-to address?
Small Tube Products
200 Oliphant Drive
Duncansville, PA 16635
Please include a short explanation of your needs.
Can STP provide commercial testing services on products not originally supplied by STP?
Yes, Small Tube Products maintains an ISO 17025 accredited laboratory that can provide many different testing activities on non-ferrous tubing for a nominal fee. Contact the Quality Department directly.
What is the difference between a certificate of compliance and a full certification (also known as chemical and physical certification)?
A certificate of compliance is a document that certifies the material to be in compliance with required specifications as mandated by the customer’s purchase order or specification. It will not include and chemical, physical, or mechanical testing results; however, the data, if required by the specification, is maintained by STP for future reference if necessary. The cost for this document is $15 per order.
A full certification will include actual chemical, physical, and mechanical testing results for those properties required by the specification. The chemical results are provided by STP’s supplier while the physical and mechanical testing is performed by STP. The cost for this document is $75 per order.
Both documents are electronically signed by the person performing the tests; however, an actual signed copy is available upon request.
Can I get a certification for material after it has shipped from STP if I did not originally request it?
Yes, STP can provide a certificate of compliance or full certification after the material has shipped. If you require testing that was not originally agreed upon during the original order contract, you may need to return parts for testing. Consult the STP Customer Service or Quality Departments for additional information.