What does Materials and Maintenance cost contain?

Material costs are estimated from benchmark data collected year over year, which combines maintenance material costs, maintenance labor costs and direct costs specific to the grades being produced. Materials include maintenance parts, contract maintenance, supplies, shipping materials, felts, wires and other incidental costs not included in other natural expense categories. Fastmarkets RISI uses regional benchmark data on maintenance man hours per ton to estimate maintenance costs for each mill.

If a mill's actual maintenance man hours per ton are above or below the benchmark average, an adjustment is made to the maintenance materials calculation to reflect the variance.

The regular Maintenance Personnel cost is included under the Labor cost item, whereas the Materials and Maintenance cost item includes contract maintenance cost.