Material Types in SAP Material Management

Quite similar to the way a vendor account group controls the properties of the vendor or the customer account group controls the properties of the customer master, material type controls the properties of the customer. The most commonly used material types are

Material Type



Finished Goods


Trading Goods




Pipeline Material


Semi-Finished Product


Raw Material


Returnable packaging






Value only material


Material Types are defined in transaction code [OMS2]. If new material types are required, copy from the existing material type.

We will discuss some important fields in the material type controls. For more, please follow the online SAP Training links or SAP MM Training Online  links.

General Data:

  • Field Reference – This is used to control the field status of the material type. This controls which fields can be hidden, displayed, made mandatory or optional. These in turn are based on the field selection group.
  • Screen Reference Material Type – We normally do not need to touch this field as this is hard coded to show different screens based on the material type. No customization is possible here.
  • Authorization Group – Basis Consultants can use this field to restrict access to a particular material type. For example, if you want certain sensitive material types to be used only by a certain group of MRP controllers, then you can use this field.
  • Item Category Group – This is an arbitrary grouping of materials. There is no control behind item category groups. They are freely definable. SAP automatically proposes the item category group while creating the material master based on the material type. This field is used to determine the item category in the sales order. This field is found in the Sales view of the material master.

User Departments

The user departments specify which views the material master has by default. The views that are selected here are shown in the material master during creation.



Price Control – There are 2 types of price control

‘S’ – Standard Price

‘V’ – Moving average

SAP proposes the price control automatically in the accounting views ( Accounting1 view )of the material master during creation. Typically, internally manufactured goods use standard price while externally procured goods have a moving average ( essentially the weighted average of the price and quantities supplied by different vendors )

For example, if the standard price of the product is $100, and if the item is externally procured for $110, then $100 is posted to the stock account and $10 is posted to the price difference account as expenditure. However, in moving average, $110 is posted to stock account.

Account Category Reference -  This is used in Material Account Determination [OBYC]. Account category is assigned to the valuation class and the valuation class is used to determine the correct G/L account to post to in the MM-FICO automatic account determination for goods movements associated with materials of that account category.

Price Control Mandatory – This check mark is used to ensure that the user who created that material master has to enter the cost ( standard or moving average )

 Quantity/Value Update – Stock keeping can be done both at the quantity level as well as the valuation level.

This is normally done based on valuation area. In this case, for example in valuation area 0001, for material type FERT, both quantity updates and value updates take place.

0 thoughts on “Material Types in SAP Material Management

  1. Murali says:


    Is there anyway material type can be changed once a material is created. Also where is the material type displayed for a material. Since the scheduling and procurement type depends on the type of the material, would like to know if the type can be changed for a material after the creation.


    • siva says:

      Material type is generally not changed after creation. However, there are certain movement types ( MM consultants would know them ) that can be used to convert the material type – However, many constraints apply – Like there should be no stock , no open POs etc. Either way, this is a rare process.


    • Dibyendu Patra says:

      Yes you can change the material type after creating material.
      But sure one thing There is no PO and No stock will exists with this material.
      T-code is MMAM.
      Otherwise you have to create a new material.


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