STATEMENT OF PROBLEM:

CCC bid a project and provided an overall deduct from the base bid for the value of the scrap.  The value of scrap was based on a quoted market value of  approximately 450 USD per gross ton.  As the project progressed, the market value of scrap steel dropped to approximately 200 USD a gross ton.  This resulted in CCC not being able to recover the value of steel equal to the deduct in the base bid.  There was no opportunity for CCC to recover these costs

COURSE OF ACTION:

There as really no solution for what CCC could do.  One option would have been to let the scrap stay on site until scrap values imnproved but contract general conditions and the customer's desire for space occupied by the scrap drove the timely removal of the scrap

LESSON FOR FUTURE PROJECTS:

There is always an element of risk associated with futures pricing.  CCC may choose in the future to provide a base bid price for the specified scope of work and offer potential value of scrap through a field order.  By doing so, the risk is more in the customer's court.