Steel Industry Update/243 October 2009

Locker Associates, 225 Broadway, Suite 2625 New York NY 10007 Tel: 212-962-2980

Table 1: Selected U.S. Steel Industry Data, August & Year-To-Date

Month of August Year-to-Date
(000 net tons) 2009 2008 % Chg 2009 2008 % Chg
Raw Steel Production ........................6,115 9,555 -36.0% 38,422 75,103 -48.8%
Capacity Utilization .......................... 57.7 90.4 -- 46.2 90.3 --
Mill Shipments ................................ 5,570 8,860 -37.1% 36,998 73,050 -49.4%
Exports .............................................. 800 1,347 -40.6% 5,445 9,156 -40.5%
Total Imports................................ 975 2,547 -61.7% 10,592 21,387 -50.5%
Finished Steel Imports ..................... 820 2,052 -60.0% 9,767 16,939 -42.3%
Apparent Steel Supply*......................5,590 9,565 -41.6% 41,321 80,833 -48.9%
Imports as % of Supply* .................. 14.7 21.5 -- 23.6 21.0 --
Average Spot Price** ($/ton) ............... 585 1,145 -49.0% 600 955 -37.2%
Scrap Price# ($/gross ton) ................... 269 572 -53.0% 212 489 -56.7%
Source: AISI, Purchasing Magazine *Excl semi-finished imports **Avg price of 8 carbon products #shredded bundles

Table 2: World Crude Steel Production by Region, August & Year-To-Date

(000 metric tons) Month of August Year-to-Date
Region 2009 2008 % Chg 2009 2008 % Chg
European Union ................................
10,751 15,835 -32.1% 84,222 142,851 -41.0%
Other Europe................................
2,625 2,916 -10.0% 18,327 22,563 -18.8%
C.I.S. ................................ 8,340 10,294 -19.0% 60,806 86,020 -29.3%
North America ................................
7,177 11,709 -38.7% 49,663 92,875 -46.5%
South America................................
3,580 4,470 -19.9% 22,649 33,505 -32.4%
Africa ................................ 1,202 1,514 -20.6% 9,543 12,197 -21.8%
Middle East................................
1,393 1,213 14.9% 11,069 10,828 2.2%
Asia ................................ 70,848 64,011 10.7% 499,897 521,069 -4.1%
Oceania ................................ 573 764 -25.1% 3,320 5,868 -43.4%
Total................................106,489 112,726 -5.5% 759,497 927,777 -18.1%
Countries
China………………… 52,327 42,903 22.0% 369,651 351,367 5.2%
Japan………………... 8,311 10,168 -18.3% 52,661 82,257 -36.0%
United States……….. 5,200 8,668 -40.0% 34,508 68,133 -49.4%
Russia………..……… 5,020 6,339 -20.8% 36,821 50,857 -27.6%
India.………………… 4,730 4,744 -0.3% 37,015 36,478 1.5%
South Korea..………. 4,240 4,484 -5.4% 31,189 36,743 -15.1%
Germany.…………… 2,950 3,985 -26.0% 19,476 32,183 -39.5%
Ukraine …………….. 2,660 3,205 -17.0% 18,937 29,137 -35.0%
All Others…………... 23,711 31,435 -24.6% 159,239 240,622 -33.8%
Source: World Steel Association, 10/09
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Source: Worldsteel, 9/09

Table 3: World Apparent Steel Consumption Outlook, 2008-2010f

Regions (000 tonnes) 2008 2009f 2010f 07/08 08/09f 09/10f
EU (27) 181,283 122,255 137,425 -8.2% -32.6% 12.4%
Other Europe 25,316 20,813 23,817 -10.8% -17.8% 14.4%
CIS 48,946 33,852 36,638 -13.5% -30.8% 8.2%
NAFTA 128,955 82,771 96,932 -8.2% -35.8% 17.1%
Ctrl & S America 44,277 33,455 36,685 6.5% -24.4% 9.7%
Africa 26,170 26,285 29,277 11.4% 0.4% 11.4%
Middle East 43,055 38,834 42,946 6.9% -9.8% 10.6%
Asia and Oceania 709,010 745,471 801,866 1.8% 5.1% 7.6%
Source: WorldSteel, 10/13/09

Table 4: World Seasonably Adjusted Crude Steel Production Trends, 2007-2012f

Effective Capacity Actual Production Year-to-Year Change
Adv Total Adv Total Adv Total
Year World China ROW World World China ROW World World China ROW World
2007 516 515 402 1,432 494 495 362 1,351 2% 17% 6% 8%
2008 522 561 416 1,500 478 501 348 1,326 -3% 1% -4% -2%
2009f -- -- -- 1,540 358 561 287 1,206 -25% 12% -18% -9%
2010f -- -- -- -- 435 577 361 1,373 21% 3% 26% 14%
2011f -- -- -- -- 448 608 399 1,456 3% 6% 11% 6%
2012f -- -- -- -- 459 639 427 1,525 2% 5% 7% 5%
Source: World Steel Dynamics, October 2009; Adv – Advanced; ROW – Rest of World

Steel Industry Update (ISSN 1063-4339) published 12 times/year by Locker Associates, Inc. Copyright © 2009 by Locker Associates Inc. All rights
reserved. Reproduction in any form forbidden w/o permission. Some material in this Update is excerpted from American Metal Market (AMM), which is
available by sub by calling 800-247-8080. Locker Associates, 225 B’way, #2625, NY NY 10007 Ph: 212-962-2980 email: lockerassociates@yahoo.com

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Table 5: Ukrainian Steel Product Shipments, Y-T-D 2009 & 2008

Product (in tonnes) Jan-Aug'09 Jan-Aug'08 % Chg
Hot-rolled coil 1,271,107 2,128,686 -40.3%
Rebar 327,676 844,027 -61.2%
Wire rods 310,240 491,921 -36.9%
Cold-rolled coil 183,201 394,395 -53.5%
Angles 101,949 231,110 -55.9%
Channels 86,331 197,155 -56.2%
Beams 25,062 83,217 -69.9%
Others 1,337,313 2,005,420 -33.3%
Total Shipments 3,642,879 6,375,931 -42.9%
Source: SteelOrbis, 9/27/09

Table 6: Chinese Steel Imports by Country, August & Y-T-D, 2009

Country Aug'09 Jan-Aug'09 Share
Japan 528,718 3,208,263 28%
South Korea 332,744 2,721,249 24%
Hong Kong 222,646 1,500,881 13%
Taiwan Region 162,072 1,265,950 11%
Russian Federation 187,238 1,051,210 9%
Kazakhstan 36,363 406,393 4%
Ukraine 0 199,513 2%
Germany 18,145 163,884 1%
Holland 20,701 108,430 1%
Belgium 10,761 107,414 1%
South Africa 12,689 105,157 1%
US 15,772 93,487 1%
Brazil 1,458 71,854 1%
Thailand 4,643 62,401 1%
UK 9,054 60,076 1%
All Others 31,437 348,067 1%
Total 1,594,441 11,474,229 100%
Source: MySteel.net, 9/25/09; in tonnes

Table 7: U.S. Spot Market Steel Prices, Actual and Forecast 2009
($/ton) Jun’09 Jul’09 Aug’09 Sep’09 Oct’09f Nov’09f Dec’09f
HR sheet 380 430 475 535 565 590 600
CR sheet 467 517 568 625 660 690 700
HD gal sheet 532 555 580 630 670 700 710
Electrogal sheet 528 565 594 635 665 695 705
Coiled plate 481 506 525 581 598 609 621
HR plate 579 604 613 632 678 697 716
Structural beam 679 661 640 633 633 654 684
Merchant bar 695 707 714 729 729 751 772
CF steel bar 747 817 840 790 790 810 815
Reinforcing bar 484 495 517 517 515 510 510
Wire rod 502 520 531 532 532 537 543
SS sheet (304) 2,045 2,188 2,272 2,334 2,447 2,504 2,567
Source: Purchasing Magazine, 9/30/09

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Table 8: North American Service Center Industry Ranking, 2009p & 2008
Sales Sales 2008 Stocking Square Primary
Rank Name 2009p ($ mil) 2008 ($ mil) Emp Locations Feet (000) Products
1. Reliance Steel & Aluminum n/a 8,720 10,000+ 200+ 23,000 C/A & SS
2. Ryerson Inc. n/a 5,300 4,100 95 9,000 C/A & AL
3. McJunkin Red Man 5,200 4,000 3,500 200 2,500 C/A & SS
4. Samuel, Son & Co. LTD 2,400 3,220 4,000 97 8,209 C/A & SS
5. Russel Metals Inc. n/a 3,160 2,670 70 4,119 C/A & SS
6. O’Neal Steel 1,800 2,920 n/a 83 n/a C/A & SS
7. ThyssenKrupp Materials n/a 2,900 3,000 75 5,000 C/A & SS
8. MACSteel Service Centers n/a 2,200 1,175 31 n/a C/A & SS
9. Metals USA Holdings n/a 2,160 2,325 68 6,550 C/A & SS
10. Namasco Corp 1,200 1,860 1,400 30 3,350 C/A
11. A.M. Castle 750 1,390 1,363 33 3,400 C/A & SS
12. Worthington Steel Co. 1,570 1,380 1,800 14 2,600 C/A & SS
13. Carpenter Technology Corp n/a 1,360 n/a 22 n/a C/A & SS
14. Steel Technologies 1,150 1,300 1,150 22 2,700 C/A
15. Edgen Murray n/a 1,260 444 18 518 C/A & SS
16. Alro Steel Corp. n/a 1,200 n/a 43 3,100 C/A & SS
16. Marmon/Keystone Corp. 748 1,200 1,326 49 4,917 C/A & SS
16. Olympic Steel Inc. n/a 1,200 1,000 17 2,200 C/A & SS
19. Steel Warehouse Co. LLC 600 1,050 731 10 1,775 C/A
20. Central Steel & Wire Co. 600 910 1,000 5 1,000 C/A & SS
21. Kenwal Steel Corp n/a 844 330 4 590 C/A
22. Heidtman Steel Products 800 809 750 11 2300 C/A
23. CoilPlus Inc. 500 751 430 9 1200 C/A
24. Triple-S Steel Holdings 400 725 500 8 2000 C/A & AL
25. Northern Steel Group, Inc 371 711 492 9 1300 C/A
26. Cargill Steel Service Centers 500 590 280 8 1000 C/A
27. Norfolk Iron & Metal Co. 350 572 550 5 1000 C/A
28. Majestic Steel USA n/a 537 200 1 330 C/A
29. Brown-Strauss Steel 320 530 210 6 200 C/A
30. Kelly Pipe Co. LLC 232 485 210 17 200 C/A & SS
31. Empire Resources Inc. n/a 430 75 2 200 C/A & AL
32. Eaton Steel Bar Co. 250 350 250 4 550 C/A
33. McNeilus Steel Inc. 210 316 288 2 698 C/A & AL
34. MISA Metals Inc. 200 310 200 5 610 C/A & SS
34. Contractors Steel Co. 170 310 257 4 1000 C/A
36. Lapham-Hickey Steel Corp. 220 300 500 7 1000 C/A & SS
36. Superior Supply & Steel 300 300 275 10 n/a C/A & SS
38. Trident Steel Corp 280 296 n/a 8 n/a C/A
39. Triad Metals International 156 287 104 3 480 C/A
40. Chicago Tube and Iron Co. 190 280 405 9 1000 C/A & SS
41. Magic Steel Sales LLC 180 260 130 3 380 C/A
42. Mill Steel Co. 150 255 110 3 375 C/A
43. Saginaw Pipe Co. Inc. 150 236 135 3 220 C/A
44. Tubular Steel Co. 124 235 350 7 700 C/A & SS
45. Friedman Industries Inc. 90 208 85 4 209 C/A
45. Pacesetter Steel Service n/a 208 150 3 295 C/A
47. McNichols Co. 150 207 350 17 624 C/A & SS
48. Eastern Metal Supply Inc. n/a 200 310 7 660 AL
48. Liberty Steel Products Inc 175 200 175 4 400 C/A & AL
50. Cambridge-Lee Industries 100 170 60 12 150 SS-AL
Total…..……………………… n/a 60,602 49,145 1,377 103,609 --
Source: Metal Center News, September, 2009
C/A - Carbon/Alloys Steel (all products) SS - Stainless Steel (all products) AL - Aluminum
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Locker Associates Steel Track: Spot Prices

U.S. Flat-Rolled Prices U.S. Other Product Prices
1450
1200
($ per ton) 1350
1100 ($ per ton)
1250
1000 CF Bar (SBQ)
Plate 1150

900
1050

800 950

700 850

CR Sheet 750
600
Beam
650
500
550
400 Wire Rod
HR Sh eet 450

300 350

200 250
89 93 97 01 03 04 05 06 07 1st 2nd3rd4th J F M A M J J A S 89 93 97 01 03 04 05 06 07 1st 2nd3rd4th J F M A M J J A S

Locker Associates Steel Track: Performance

U.S. Raw Steel Production U.S. Capacity Utilization
10.0 100%
( mil net tons)
2009 2008
9.0 90%

8.0 2009
80%
2008
7.0 70%

6.0 60%

5.0 50%

4.0 40%

3.0
J F M A M J J A S O N D 30%
J F M A M J J A S O N D
2009 4.5 4.4 4.4 4.2 4.5 4.8 5.6 6.1 2009 43% 46% 43% 41% 43% 47% 52% 58%
2008 9.5 9.1 9.5 9.2 9.6 9.2 9.4 9.6 8.6 7.5 5.1 4.3 2008 90% 92% 90% 90% 91% 90% 89% 90% 85% 71% 51% 41%

U.S. Spot Prices for Selected Steel Products, September & Year-to-Date
Month of September Year-To-Date
($ per net ton) 2009 2008 %Chg 2009 2008 %Chg
Hot Rolled Sheet………….. 535 983 -46% 457 889 -49%
Cold Rolled Sheet......…….. 625 1,064 -41% 546 973 -44%
HD Galvanized Sheet..…… 630 1,165 -46% 604 1,032 -42%
Coiled Plate................……. 581 1,176 -51% 614 996 -38%
Cold-Finished Bar (SBQ)….. 790 1,217 -35% 801 1,207 -34%
Wide-Flange Beams....…… 633 1,110 -43% 726 965 -25%
Wire Rod/Low Carbon.…… 532 1,009 -47% 552 876 -37%
Rebar.........................…….. 517 947 -45% 503 820 -39%
Average Spot Price+…….. 605 1,084 -44% 600 970 -38%
Stainless Sheet 304……… 2,334 4,045 -42% 2,268 4,216 -46%
OCTG Seamless Tube…… 1,461 3,346 -56% 1,767 2,268 -22%
Scrap ($/gross ton)*....………. 290 374 -23% 221 477 -54%
Sources: Purchasing Mag, Spears Research +Comp price of 8 carbon products *shredded bundles
Update #243

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