The Olander Corporation is well aware of the pending EC RoHS regulations due to take effect on July 1st of 2006. We have been polling our suppliers since January 2005 to determine which are in compliance and when those who are not might be.

The issues are:

• Base material
• Plating
• Certification from our suppliers

The vast majority of commercial threaded fasteners sold in the United States are imported from other parts of the world and then sold through distributors to the end user. Also, more and more US fastener "manufacturers" are outsourcing their manufacturing overseas.

The importers purchase parts many months in advance and have vast inventories on hand to carry them through the manufacturing and shipping lead time. What this means is there is a lot (hundreds of millions) of threaded steel fasteners at importers in the United States with Hexavalent chrome plating that cannot be used in Europe after June of 2006. We know of only one importer at this time that has taken it upon themselves to start stripping and re-plating some of their inventory for distributors that are requesting them to do so. This one importer is also ordering steel fasteners with trivalent chrome plating on their incoming shipments.

Other importers will send parts to platers after selling them to a distributor and the distributor pays to have the part re-plated and then delivered. Fasteners are relatively inexpensive. To have a fastener stripped of hexavalent chrome and re-plated with trivalent chrome can double the cost of the fastener. (A note here; just because one re-plates a steel part with a compliant plating, that does not make the part compliant. What about the base steel? No one has certified that the base steel is compliant. We can't. We did not manufacture it or purchase it from the manufacturer and the importers did not ask for certification because they may have purchased the part over a year ago, prior to any knowledge about EC RoHS regulations). Until EC RoHS, importers may not have specified the type of steel from which the fasteners were to be manufactured. Threaded fasteners are a commodity, not usually manufactured by the best, most controlled manufacturing facilities.

Another issue is: What platers are qualified to apply trivalent zinc? Are their lines set up in a way that prevents the trivalent parts from contamination? The platers that appear to be qualified are charging twice what we used pay for hexavalent zinc plating. (Supply and demand)

Trivalent chromate passivation does not provide the same level of protection from corrosion that hexavalent chromate does. That is why the industry has been utilizing hexavalent chromate.

For our customers that have been requesting that we certify that RoHS certified parts will be at least as good, we can't do that.

The high density, heavy weight, of fasteners leads to high freight costs as well. A fastener that went to a distributor from an importer now goes from an importer to a plater to the distributor, adding freight cost. It is not uncommon to purchase $100.00 of fasteners and have the freight cost be $25.00.  Now it is going to cost $25.00 to the plater, then $25.00 to the distributor and $75.00 to strip and re-plate the fastener. 

The box of fasteners that used to cost $125.00 now costs $225.00. This is reality until the importers can get trivalent chromate zinc coming into the US in volume.

As far as we have been able to discern, stainless steel threaded fasteners have nothing in them that would make them non-compliant with EC RoHS regulations. However, the stainless steel importers will not issue a statement of compliance on anything purchased from them prior to that statement date. If we have a statement of compliance dated 7/1/05, all parts sent to us 7/1/05 or later would be compliant, but the same part from the same lot at the importer sent on 6/30/05 would not be. Sounds uncomfortably like a way to increase sales by obsolescing your customer's (our) inventory to me. By the way, there are only two large stainless steel importers in the US. All of us have to play by their rules. (Sounds kind of like the oil companies.)

US manufacturers from whom we purchase stainless steel threaded fasteners have had no problem with a back dated statement, we find it curious that the importers are reluctant to do likewise.

Also at issue are the hundreds of millions of fasteners already at the distributor level. What to do with them?

Again, the stainless steel military parts are compliant and we have certifications from our suppliers.

Steel military parts are not going to be compliant. They have cadmium plating with a dichromate supplemental treatment that is non-compliant and they are not going to change. This will be an issue for any electronics original equipment manufacturer that has designed in a military part number in their non-military, non-flight, non-medical application.

This will also be an issue with some non-military manufacturers like PEM and Captive. While 99% of their manufacturing is for commercial applications, one or two of their part numbers are qualified as military part numbers and have non-compliant plating that the military applications require.

While we have had requests (less than 30) about our compliance to the EC RoHS regulations. We have over 1,500 accounts. Many are medical instrument manufacturers and aircraft subcontractors that are not impacted by this regulation. We had a medical instrument subcontractor recently tell us that they did not want any RoHS compliant parts and were going to ship back the compliant parts we shipped them because the drawing they manufacture and assemble to does not specify RoHS compliant plating. Go figure!

So here we are, a fastener distributor with:

• Compliant parts
• Non-compliant parts
• Non-compliant parts that will always be non-compliant
• Non-compliant parts that some of our customers want left that way
• Parts that probably are compliant, but because our supplier will not issue a compliance statement to us, we have to call non-compliant.

We will quote and ship our customers what they request. If they want RoHS compliant parts, then they will have to tell us at the time they ask us to quote, because many of our customers don't need and in some cases do not want compliant parts.

We are and always have been a stocking distributor, stocking what our customers purchase.

Since January of 2005, we have been diligently working to ascertain which of our over 40,000 part numbers are compliant, which are not, and working to replace the non-compliant with compliant. We will continue to do so.

On advice from our attorney, we will only certify as compliant each part for which we have certification in hand from our suppliers, no more. Initially, we were going to call all the parts that we are sure are compliant, compliant. (Stainless steel, 6/6 nylon, trivalent zinc plated steel, etc) But, our attorney has advised against this because we would be making a statement for which we have no documentation. Some of our suppliers were going to call all the "seemingly compliant" parts compliant as well, but changed their minds about the same time we did. I think that they had a talk with their attorneys too.

We have had some of our customers making the determination of compliancy based on the information we are giving them. So, even though we can not call the part compliant, they have.

I envision having to carry inventory in compliant and non-compliant parts as long as regulations allow some industries to be non-compliant.

As previously stated, this is an evolving situation. There has not been a day go by in recent memory when we haven't had a meeting or four on EC RoHS.

Bob Betts

VP/GM