Metals, Steel, Aluminum & Coil Processing worked example

Metal Price Sensitivity at 72% unhedged portion of the buy: a worked example in metals, steel, aluminum & coil processing

Suppose unhedged portion of the buy falls to 72%. This page works the full calculation at that level so you can see exactly which result moves and by how much. Estimate the cost impact of a metal price move from the weight exposed, the price change per pound, the unhedged share, and any fixed adder.

The inputs for this scenario

  • Metal weight exposed to price swing: 200,000 lb (held at the documented default)
  • Price move per pound: 0.05 $ / lb (held at the documented default)
  • Unhedged portion of the buy: 72 % (the input this scenario stresses; the baseline uses 100)
  • Fixed surcharge or contract adder: 0 $ (held at the documented default)

Working through the calculation

  • The calculation starts from the formula this tool documents: Variable price impact = weight exposed × price change × unhedged share.
  • Total price impact works out to 7,200 $ at these inputs, and this is the headline figure for the scenario.
  • Impact per pound works out to 0.04 $ / piece at these inputs.
  • Variable price impact works out to 7,200 $ at these inputs.
  • Fixed cost adder works out to 0 $ at these inputs.

How this compares with the baseline

  • Against the tool's baseline example, where unhedged portion of the buy sits at 100% and the headline result is 10,000 $, this scenario comes in 28% below the baseline at 7,200 $.
  • It multiplies the unhedged weight by the per-pound price change to get the variable dollar exposure, then adds any fixed surcharge to give a total price impact. When the numbers land here, the stressed input is the lever to work; the walkthrough above shows exactly how much each output recovers as it climbs back toward the baseline.

Results at a glance

  • Total price impact: 7,200 $ (headline result)
  • Impact per pound: 0.04 $ / piece
  • Variable price impact: 7,200 $
  • Fixed cost adder: 0 $

Run it with your numbers

  • To rerun this with your own numbers, open the live Metal Price Sensitivity calculator, set unhedged portion of the buy to your actual value, and adjust the remaining inputs to match your operation.

Last reviewed 2026-05-12.