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Material | March 31, 2007

Cookson put surcharge on tin-bearing solder pastes

A global shortfall in the supply of tin, versus forecasted consumption in 2007, has caused the price of tin to reach 19 year highs on the London Metals Exchange and the Kuala Lumpur Tin Market.
Cookson Electronics Assembly Materials is announcing a surcharge on ALPHA brand tin-bearing solder pastes, effective 30 days from customer notification. Tin has moved from a trading range of $6,000 to $9,000/metric ton during much of 2006, to over $14,000/metric ton in the first quarter of 2007, Cookson said. The increase in the price of tin has forced ALPHA to pass along the increased costs to customers.

ALPHA will roll out surcharges on tin-bearing solder pastes in a series of tiers linked to the current price of tin in comparison to the previous trading range. When prices return to mid-2006 levels, the surcharges will be eliminated. If the global shortage of tin becomes more severe, the strategy will assure a continuous supply of materials for customers, Cookson said.

"We have been able to absorb this significant cost increase up to a certain point," said Steven Corbett, Chief Executive Officer of Cookson Electronics. “If we are to maintain the levels of technical support and research and development that our customers expect, we have no choice but to implement these surcharges. There is no way of predicting how long the production shortfalls of tin in Bolivia and Indonesia will last. This surcharge is designed to minimize daily fluctuations for our customers, assure continuous supply of material should the tin shortage accelerate and allow price relief if and when the price of tin returns to previous levels."

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