PRESS RELEASE

FOR IMMEDIATE RELEASE

Monday,2 June 2009

BIR WorldRecycling Convention

25-27 May2009, Dubai

PressReleases on Commodity Sessions

StainlessSteel & Special Alloys Committee:

Potentialsupply/demand imbalance

Stainless steel scrapavailabilityremains low and a significant increase in demand could bring asupply/demand imbalance, according to Michael Wright of UK-based ELGHaniel Metals Ltd. There is “always a pause of three to six months”between increased production of stainless steel and an upturn inscrap availability, the Chairman of the BIR Stainless Steel &Special Alloys Committee reminded delegates at the meeting in Dubai.

In a written submission,Past ChairmanBarry Hunter of Hunter Alloys LLC in the USA agreed that, if recentgrowth in Chinese stainless steel production proved sustainable, then“scrap availability compared to price will become the major marketconcern for our consumers”.

In the early months of2009,availability of revert and new production scrap tumbled,respectively, 40% and 25% whereas old scrap availability plummeted aminimum of 60%, according to Mr Wright. Scrap volumes are expected toslide from 7.4m tonnes in 2008 to between 5.2m and 5.8m tonnes forthe whole of 2009. Global stainless steel consumption is thoughtlikely to fall 17% from 23.6m tonnes last year to 19.6m tonnes in2009. However, the speaker stressed that, in the light of currentturbulent conditions, “these figures could be out of date within afew weeks”.

Ahmad Sharif of SharifMetals in Jordanpointed to an emerging shortage of stainless steel scrap in theMiddle East. Meanwhile, a 40%-plus collapse in stainless steel ordersin India resulted in the country’s scrap imports slumping from aquarterly average of 75,000 tonnes in 2008 to around 50,000 tonnes inthe first quarter of 2009, it was observed by Anand Gupta of AmbicaSteels.

Further east in Japan, 2009domesticproduction of stainless steel is expected to fall below 2m tonnes“for the first time in more than 30 years”, according to MarkSellier of KMR Stainless BV. Overall, he added, Asia’s scrapvolumes are “down more than 75%” owing to significantly reducedmanufacturing activity, with revert scrap effectively “drying up”.

Reporting on events inRussia, IldarNeverov of Scrap Market Ltd confirmed that customs authorities havereduced from more than 40 to just 10 the number of locations fromwhich scrap metal can be exported. St Petersburg has become an evenmore important shipping point as a result, handling scrap from as farafield as Siberia and the eastern regions of the country. However,the speaker envisaged “logistics problems” at the port in thenear future. Mr Neverov went on to predict that Russian exports ofstainless steel scrap will drop some 20% this year to around 100,000tonnes.

In his special alloysreport, PhilRosenberg of Keywell in the USA noted “quite depressed” demandfor high temperature alloys and titanium, largely as a result of adrop-off in orders for new airliners.

The Stainless Steel& SpecialAlloys Committee’s guest speaker George Adcock of the London MetalExchange warned delegates to expect further price volatility amongleading non-ferrous metals. He also confirmed that the Exchange plansto introduce molybdenum and cobalt contracts, and that it wouldcontinuously review the scope to add other commodity contracts to itsportfolio.

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