Steel Industry Update/275

June 2012

Locker Associates, 225 Broadway, Suite 2625 New York NY 10007

Tel: 212-962-2980

Table 1: Selected U.S. Steel Industry Data, April & Year-to-Date, 2012
Month of April
2012
2011
8,630
7,772

(000 net tons)

Raw Steel Production ...............

% Chg
11.0%

2012
34,216

Year-to-Date
2011
31,195

% Chg
9.7%

Capacity Utilization .................

80.9

74.4

--

79.7

74.4

--

Mill Shipments ..........................

8,245

7,259

13.6%

33,663

29,761

13.1%

Exports .....................................

1,167

1,027

13.6%

4,844

4,169

16.2%

Total Imports.............................

3,145

2,549

23.4%

11,748

8,976

30.9%

Finished Steel Imports ............

2,484

1,929

28.8%

8,988

6,936

29.6%

Apparent Steel Supply* .............

9,563

8,161

17.2%

37,808

32,527

16.2%

Imports as % of Supply*..........

26.0

23.6

--

23.8

21.3

--

Average Spot Price** ($/ton) ......

$805

$969

-16.9%

$819

$904

-9.4%

Scrap Price# ($/ton) ...................

$430

$442

-2.7%

$443

$443

-0.1%

Sources: AISI, SteelBenchmarker

*Excl semi-finished imports

**Avg price of 3 carbon products

#shredded scrap

Table 2: U.S. Spot Prices for Selected Steel Products, June & Year-to-Date, 2012

Hot Rolled Band....

Cold Rolled Coil........
Coiled Plate..................

Month of June
2012
2011
% Chg
628
756
-16.9%
726
853
-14.9%
879
1038
-15.3%

2012
690
790
921

Average Spot Price....

$744

$882

-15.6%

$800

$917

-12.7%

OCTG*

1,992

1,915

4.0%

2,023

1,825

10.8%

#1 Heavy Melt...
Shredded Scrap...
#1 Busheling.

336
373
383

405
440
490

-17.0%
-15.2%
-21.8%

388
429
450

404
440
473

-3.9%
-2.5%
-4.8%

($ per net ton)

Year-to-Date
2011
% Chg
825
-16.4%
918
-14.0%
1,006
-8.4%

Sources: World Steel Dynamics, Spears Research, 6/12; *OCTG data is May 2012

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Steel Industry Update/275

Table 3: World Crude Steel Production, May & Year-to-Date, 2012

Month of May
Year-to-Date
(000 metric tons)
2012
2011
%
Chg
2012
2011
Region
European Union.
15,300
16,534
-7.5%
74,204
74,639
Other Europe.
3,307
2,742
20.6%
16,003
12,084

% Chg
-0.6%
32.4%

C.I.S.

9,305

9,553

-2.6%

46,136

44,806

3.0%

North America

10,639

9,932

7.1%

59,912

46,794

13.1%

South America...

3,990

3,664

8.9%

19,864

17,519

13.4%

Africa/Middle East.....

3,077

2,793

10.2%

14,755

13,559

8.8%

Asia..

84,475

78,475

7.6%

409,403

373,037

9.7%

Oceania......

473

687

-31.2%

2,355

3,286

-28.3%

Total

130,566

124,381

5.0%

635,633

585,726

8.5%

61,234
9,228

55,877
9,724

9.6%
-5.1%

296,261
44,870

267,491
45,221

10.8%
-0.8%

Country
China.......
Japan...
United States..

7,669

7,264

5.6%

38,709

33,808

14.5%

India(e).

6,200

5,860

5.8%

30,200

28,440

6.2%

Russia(e).

6,100

5,937

2.7%

30,125

27,447

9.8%

South Korea.......

5,973

5,246

13.9%

29,188

23,930

22.0%

Germany...

3,713

4,073

-8.8%

18,157

18,888

-3.9%

Turkey

3,081

2,536

21.5%

14,991

11,006

36.2%

Brazil...

2,887

2,856

1.1%

14,640

13,530

8.2%

Ukraine(e)...

2,600

2,906

-10.5%

13,102

14,168

-7.5%

All Others....

21,881

22,102

-1.0%

105,390

101,797

3.5%

Source: World Steel Association, 6/12; e=estimate

Graph 1: World Crude Steel Production, May 2012

Source: World Steel Association, 6/12; in million metric tons

-2-

Steel Industry Update/275

Graph 2: World Steel Capacity Utilization, May 2012

Source: World Steel Association, 6/12

Table 4: European Crude Steel Production Data for January - May 2012
Country
Austria

May'11
627

May'12
676

% Chg
-7.3%

J-May'11
3,198

J-May'12
3,267

% Chg
-2.1%

Belgium

680

Bulgaria

65

751

-9.4%

3,241

3,824

-15.3%

80

-18.9%

314

363

-13.4%

Czech Republic

487

Finland

346

508

-4.2%

2,313

2,391

-3.3%

385

-10.3%

1,777

1,908

-6.9%

France

1,475

1,457

1.3%

7,042

6,740

4.5%

Germany

3,713

4,112

-9.7%

18,157

19,313

-6.0%

80

201

-60.2%

561

850

-34.0%

Greece
Hungary

141

149

-5.1%

695

698

-0.4%

2,568

2,656

-3.3%

12,412

12,134

2.3%

Luxembourg

200

241

-16.9%

896

1,199

-25.3%

Netherlands

520

614

-15.3%

2,817

2,987

-5.7%

Poland

810

718

12.8%

3,950

3,569

10.7%

Italy

Romania

335

260

29.1%

1,640

1,536

6.8%

Slovakia

385

325

18.5%

1,937

1,860

4.1%

Slovenia

60

62

-3.0%

295

293

0.6%

1,293

1,501

-13.9%

6,240

7,332

-14.9%

406

496

-18.2%

2,102

2,358

-10.9%

Spain
Sweden
United Kingdom

918

845

8.6%

3,682

4,127

-10.8%

Other EU (e)

192

155

23.5%

935

856

9.2%

15,300

16,191

-5.5%

74,204

77,606

-4.4%

European Union (27)

Source: World Steel Association, 6/12

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Steel Industry Update/275

Table 5: US Exports of Ferrous Scrap by Destination, April 2012

Country
Canada
China
Egypt
Hong Kong
India
Japan
Malaysia
Mexico
South Korea
Taiwan
Thailand
Turkey
Others
Total

April
104,549
176,620
380
4,540
156,106
5,514
61,722
46,827
213,065
300,544
50,644
617,711
151,016
1,889,238

March
108,734
303,483
38,515
4,475
140,209
4,763
70,768
31,638
352,106
346,249
46,996
561,934
139,629
2,149,519

Feb
128,438
229,001
83,998
9,298
29,622
5,773
2,545
68,073
308,671
223,783
53,945
600,524
75,890
1,859,561

YTD12
447,951
642,865
214,145
24,100
437,045
19,771
168,897
176,142
1,118,489
1,130,631
164,539
2,149,885
420,462
7,314,922

YTD11
549,103
1,380,867
129,727
44,832
188,087
66,529
397,734
221,497
1,144,353
1,016,305
364,291
1,284,551
485,577
7,273,453

% Chg
-18.4%
-39.0%
65.1%
-46.2%
132.4%
-70.3%
-57.5%
-20.5%
-2.3%
11.2%
-54.8%
67.4%
-13.4%
0.6%

Source: American Metal Market, 6/14/12

Table 6: US Slab Imports by District, 2012

Mobile, AL
Los Angeles, CA
Columbia-Snake
Philadelphia, PA
Houston-Galveston, TX
New Orleans, LA
Detroit, MI
Buffalo, NY
Total

April 2012
216,335
129,871
54,224
53,339
41,420
37,079
19,898
12,625
570,848

March 2012
265,941
194,267
117,092
88,259
5,369
2,742
23,718
18,066
724,732

April 2011
136,108
186,034
68,189
-26,084
1,840
55,591
41,252
518,687

Source: American Metal Market, 6/14/12

Steel Industry Update (ISSN 1063-4339) published 12 times/year by Locker Associates, Inc. Copyright 2012 by Locker Associates, Inc. All
rights reserved. Reproduction in any form forbidden w/o permission. Locker Associates, Inc., 225 Broadway Suite 2625 New York NY 10007.

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Steel Industry Update/275

Table 7: World DRI Production by Region, 2011

Region
Latin America
Argentina
Brazil

2001

2003

2005

2007

2009

2010

2011

1.28
0.43

1.74
0.41

1.83
0.43

1.81
0.36

0.81
0.01

1.57
--

1.68
--

Mexico

3.67

5.62

5.98

6.26

4.15

5.37

5.85

Peru

0.07

0.08

0.09

0.09

0.10

0.10

0.09

Trinidad & Tobago

2.31

2.28

2.25

3.47

1.99

3.08

3.03

Venezuela

6.38

6.90

8.95

7.71

5.61

3.79

4.47

2.37
5.00

2.87
5.62

2.90
6.85

2.79
7.44

2.91
8.20

2.86
9.35

2.97
10.37

Middle East/N. Africa

Egypt
Iran
Libya

1.09

1.34

1.65

1.64

1.11

1.27

0.30

Qatar

0.73

0.78

0.82

1.30

2.10

2.16

2.23

Saudi Arabia

2.88

3.29

3.63

4.34

5.03

5.51

5.81

Australia
China

1.37
0.11

1.95
0.31

-0.41

-0.60

-0.08

---

---

India

5.59

7.67

12.04

19.06

22.03

23.42

21.97

Asia/Oceania

Indonesia

1.48

1.23

1.39

1.42

1.23

1.36

1.32

Malaysia

1.12

1.60

1.38

1.84

2.30

2.39

2.16

Myanmar

0.04

0.04

--

--

--

--

--

-0.12

0.50
0.21

0.59
0.22

0.91
0.25

0.34
--

0.60
--

0.70
--

2.51

2.91

3.34

3.41

4.67

4.79

5.20

1.56

1.54

1.78

1.74

1.39

1.12

1.41

Germany

0.21

0.59

0.44

0.59

0.38

0.45

0.38

World Total

40.32

49.45

56.99

67.22

64.44

70.37

73.32

North America
Canada
US
Former USSR/E. Europe
Russia
Sub-Saharan Africa
South Africa
Western Europe

Source: Midrex, 2011 World DRI Statistics Report; in million metric tonnes

Table 8: World DRI Production by Process, 2011

Name
MIDREX
HYL/Energiron

2001
26.99

2003
32.06

2005
34.96

2007
39.72

2009
38.62

2010
42.01

2011
44.38

8.04

9.72

11.12

11.3

7.99

9.9

11.12

Other Shaft Furn/Retort Process

0.14

0.04

--

--

--

--

--

Fluidized Bed Processes

1.93

2.57

1.52

1.05

0.5

0.34

0.48

Rotary Kiln, Coal-based

3.18

5.04

9.17

14.9

17.33

18.12

17.34

--

--

0.22

0.25

--

--

--

40.32

49.45

56.99

67.22

64.44

70.37

73.72

Rotary Hearth, Coal-based*

World Total

Source: Midrex, 2011 World DRI Statistics Report; in million metric tonnes

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Steel Industry Update/275

Table 9: Service Center Transactions, 2011-2012

Date
2/2/11
3/10/11
3/11/11
3/24/11
4/29/11
5/18/11
5/25/11
7/1/11
8/2/11
9/13/11
11/15/11
11/18/11
12/1/11
12/16/11
12/30/11
1/3/12
2/14/12
3/12/12
3/12/12

Seller
MISA non-automotive SC business
D.S. Brown
Richard Trident
Singer Steel
Macsteel Service Centers USA
Chicago Tube & Iron
Stainless Pipe and Fittings Australia
Basic Stainless
Continental Alloys & Services
Versatile Processing
Sierra Alloys
Niagara Lasalle
Coleman Co., Propane Cylinder business
Tube Supply
Fushi Copperweld
Angus Industries
Winchester Metals
Gregor Technologies
HD Supply Industrial PVF

Buyer
Worthington Industries
Gibraltar Industries
Metals USA
Ryerson
Klockner & Co.
Olympic Steel
McJunkin Red Man
Samuel, Son & Co.
Reliance Steel & Aluminum
Insight Equity
Platte River Ventures
The Optima Group
Worthington Industries
A.M. Castle
TPG, Abax Global Capital
Worthington Industries
Pennsylvania Steel Co.
Metals USA
Towerbrook/Inland Shale

Source: Meter Center News, April 2012

Graph 1: US vs China and Other Markets Cost Gap, 2005, 2011 & 2013p

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Steel Industry Update/275

Table 10: Voestalpine 2011-2011 FY Results
(in EUR millions)

Revenue
EBITDA
EBITDA (margin in %)

2010-11
10,953.7
1,605.6

2011-12
12,058.2
1,301.9

% Chg
10.1
-18.9

14.7%

10.8%

--

EBIT

984.8

704.2

-28.5

EBITmargin (in %)

9.0 %

5.8%

--

Profit before tax

781.0

504.4

-35.4

Profit for the period**

594.6

413.3

-30.5

3.04

1.98

--

57.8%

53.5%

--

EPS (in EUR)

Gearing ratio( in %)
Source: SteelGuru.com, 5/31/12

Table 11: Magnitogorsk Financial Results, 1st Quarter 2012

Q1'12
2,425
2,099
33
293
267
-18
42
2
14

(in US$ million)

Revenue
Cost of sales
Operating profit
EBITDA
Steel segment (Russia)
Steel segment (Turkey)
Coal segment
Consolidation effect
Profit for the period

Q4'11
2.243
1,987
-47
203
227
-67
46
-3
-67

% Chg
8%
6%
44%
18%
-9%
-

Q1'12
2,425
2,099
33
293
267
-18
42
2
14

Q1'11
2.216
1,775
155
403
337
-4
70
0
134

% Chg
9%
18%
-79%
-27%
-21%
-40%
-90%

Sources: SteelGuru.com, 6/16/12

Table 12: Turkish Crude Steel Output, 2011-2012 YTD

Billet
Slab

2011
24,400
9,707

Jan-May 11
9,856
3,724

Jan-May 12
11,162
3,825

% Chg
13.3%
2.7%

Total

34,107

13,580

14,987

10.4%

EAF

25,275

10,007

11,273

12.7%

BOF

8,832

3,573

3,714

3.9%

(in 000 tonnes)

Source: SteelGuru.com, 6/16/12

Table 13: Turkish Exports to MENA Region, Q112

Country
Saudi Arabia
Iraq
UAE
Libya
Egypt
Israel
Yemen
Morocco
Lebanon
Iran

Q1'12
473,715
385,488
310,320
179,192
167,963
157,321
150,497
761,02
69,892
44,896

Q1'11
241,391
238,287
638,916
79,173
110,655
131,456
54,818
98,811
77,846
185,561

Source: SteelGuru.com, 6/16/12; MENA: Middle East, North Africa

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Steel Industry Update/275

Locker Associates Steel Track: Spot Prices

U.S. Flat-Rolled Prices

U.S. Scrap Prices

($ per ton)

($ per ton)

500

1100

#1 Busheling
Plate

1000

450

Shredded Scrap
900
400

CR Coil
#1 Heavy Melt

800
350

700

Rebar

HR Band

300

600

250

500

200

400
'07 '08 '09 '10 1q 2q

'07 '08 '09 '10 1q 2q

Locker Associates Steel Track: Performance

10.0

U.S. Raw Steel Production

2012

2012
2011

9.0

80%

7.0

70%

6.0

60%

5.0

50%

4.0

40%

2011

90%

8.0

3.0

U.S. Capacity Utilization

100%

(mil net tons)

30%

2012 8.5 8.3 8.8 8.6

2012 78% 81% 80% 81%

2011 7.9 7.4 8.1 7.8

2011 73% 75% 75% 74%

Steel Mill Products: US Imports, April & Year-to-Date, 2012

Imports: Country of Origin
(000 net tons)

Canada..
Mexico
Other W. Hemisphere..
European Union
Other Europe*..
Asia.
Oceania.
Africa..
Total
Imports: Customs District
Atlantic Coast
Gulf Coast/Mexican Border
Pacific Coast.
Gr Lakes/Canadian Border
Off Shore

Month of April
2012
2011
% Chg
539
555
-2.9
227
241
-5.8
406
215
88.8
525
312
68.3
487
227
114.5
946
833
13.6
13
156
-91.7
2
11
-81.1
3,145
2,549
23.4
362
1,530
520
713
19

257
1,083
546
647
17

Source: AISI; *includes Russia

Update #275
-8-

40.0
41.3
-4.8
10.2
11.8

2012
2,031
868
1,628
1,813
1,778
3,507
101
22
11,748
1,526
5,822
1,998
2,321
79

Year-to-Date
2011
1,991
1,118
845
1,347
762
2,507
349
58
8,976
1,106
3,836
1,771
2,192
71

% Chg
2.0
-22.4
92.7
34.6
133.3
39.9
-71.1
-62.1
30.9
38.0
51.8
12.8
5.9
11.3

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