PRESS RELEASE

Brussels, 11^thJune 2008

2008World Recycling Convention &

BIR’s60^thAnniversary Celebration

MonteCarlo, 2-4 June 2008

StainlessSteel & Special Alloys Committee:

Marketin oversupply

The stainless steel market has swung into oversupply and is lacking a“feel-good factor”, the BIR Stainless Steel & Special AlloysCommittee meeting in Monte-Carlo was told by familiar guest speakerMarkus Moll, Senior Market Analyst at Austria-based Steel &Metals Market Research.

He anticipated a global production increase of “only 4%” thisyear to 28.775 million tonnes, with the Chinese “locomotive”likely to fall short of double-digit growth as producers encounteredmounting difficulty in finding markets for their products.Nevertheless, between now and 2012, Chinese consumption of stainlesssteel was expected to grow at around 9% per annum while, during thesame period, demand from India would overtake that of the USA andJapan.

Mr Moll also predicted the “renaissance” of 304 stainless owingto the shrinking cost advantage of alternatives.

Summarising reports on the European market, Stainless Steel &Special Alloys Committee Chairman Michael Wright of ELG Haniel MetalsLtd of the UK alluded to “signs of caution”. He elaborated:“Stockists are working from hand to mouth and are reluctant to holdhigh inventories in view of the uncertain nickel prices and explodingchrome and iron prices.”

Mr Wright went on to propose the organisation of a meeting onradiation detection. Products from the 1970s and 1980s containingradioactive elements such as caesium and americium were now enteringtheir end-of-life phase and were duly creating “a serious problemfor our industry”, he maintained.

Although official Commerce Department statistics had indicated USexports of stainless scrap exports of more than 880,000 tonnes in2007, the actual figure was likely to be somewhat lower but still“very significant” - possibly at around 750,000 tonnes, accordingto Barry Hunter of US-based Hunter Alloys LLC. “Approximately 85%of the reported material exported from the USA in 2007 was destinedfor Asian markets, basically leaving 15% for European exports,” hesaid.

Last year, Chinese Taipei had superseded China as the leading Asian consumerof US stainless scrap exports and, in physical metal terms, thecontinuing absence of Chinese buyers represented “perhaps the mostsignificant change in the marketplace”. But Mr Hunter added: “Aswe get further into the year, the general lack of scrap, thecontinued impact of chrome and iron, and the eventual need formaterial in China may well rekindle international competition forstainless steel scrap.”

In a report on the South African and Asian markets, Mark Sellier ofOryx Stainless noted that Chinese production of stainless steel hadbeen 12% lower in the first quarter of 2008 when compared to thefinal three months of last year, although the figure was still 30%higher than that for first-quarter 2007. However, some Asianmanufacturers were expected to implement production cuts of up to 20%beginning in the third quarter of this year.

Meanwhile, energy shortages had resulted in a 17% drop in SouthAfrica’s stainless steel production in January-March 2008 whencompared to the corresponding period of last year. “Scrapavailability in the region has also been adversely affected,” MrSellier pointed out.

While the Russian stainless steel scrap market remained“export-oriented”, volumes shipped overseas had declined from286,000 tonnes in 2006 to nearer 200,000 tonnes last year, accordingto Ildar Neverov of Scrap Market Ltd. Domestic stainless productionwas expected to increase “greatly” in the coming years, he added.

Ahmad Sharif of Sharif Metals Est in Jordan spoke of rising demandfor stainless steel in the Middle East and of the considerablevolumes of nickel/chromium tubes generated by the oil industry.

According to the special alloys report from Stuart Freilich ofUniversal Metal Corporation in the USA, which was presented in hisabsence by Mr Hunter, demand for titanium had suffered as a result of“production schedule push-outs” by leading aircraft manufacturersand the military worldwide. The need for large volumes of titaniumfor these programmes “will probably not recover until some time inlate 2009 or 2010”, he said. Meanwhile, orders for ferro-titaniumand scrap high-temperature alloys remained strong for the most part.