Surcharge for silver on DK products

Trend of prices for raw materials

The price of raw materials has been taking an ever more grotesque turn. Prices are fluctuating as never before. This distorted trend is reflected in an amusing incident at a park in Mülheim: A statue weighing 1.5 tons which had been adorning the park for 75 years, was stolen. The thieves did not perceive the statue as a work of art; instead, they wanted its bronze metal. From the perspective of the thieves it was rather unlucky that at that very time – in spring 2011 – prices for raw materials suddenly fell drastically.

At the same time, we held intensive internal debates here at DK-Kälteanlagen about whether it is necessary – in addition to the surcharge for copper – to equally introduce a surcharge for silver. The price of silver had just reached a never-before seen level. Compared to the previous year, the price had risen 2.4 times (28. 04. 2011 – € 1,228.40 compared to 28. 04. 2010 – € 508.60).

DK-Kälteanlagen postponed the decision regarding the surcharge for silver since, as already mentioned, prices suddenly fell. Instead, there was hope that markets would settle down and that prices would return to a level as seen during the previous years. DK-Kälteanlagen was wrong to assume this. Therefore, it is indispensable now to at least partially pass the high price of silver (comparison of annual mean 2010 approx. € 500 with 2011 approx. € 1,000) to DK customers.

Why does DK actually need silver for DK products?

All external DK Heat Exchangers are pressure vessels which have to be welded. The solder used for this contains silver. Based on this composition of the solder, the TÜV certificates are drawn up for DK products. DK-Kälteanlagen is of the opinion that quality is not a matter of discussion. Consequently, DK Tubular Deheaters, DK Tubular Capacitors, DK Suction Gas Heat Exchangers, DK Shell and Tube Condensers and the interconnections with DK Heat Exchangers will continue to be produced with solders containing silver even in future.

Additional calculation of the cost of silver in solder

With immediate effect DK will add a surcharge for silver to its offers, due to the situation described above. This weight-related surcharge is calculated for quotations above a basic value of 500.00 €/kg. This basic value is oriented towards the annual mean in 2010. The decisive criteria for the value of the invoice is the price on the day on which the order was confirmed.

Sample calculation

The price of silver on 30.08.2011 amounted to 1,060.90 €/kg. The surcharge for silver for e.g. the tubular deheater, model 159/50x13 (1.7) with a silver weight of 0.27 kg, thus totals:

                         €  560.90 (€ 1,060.90./. 500.-) x 0.27 (kg) = € 151.44

We ask for your comprehension for this measure and hope that the price of metal will soon stabilise at a lower price.