OHIO STEEL PRODUCTION, SHIPPING POST SUBSTANTIAL GAINS IN 2003; LEADING INDICATORS SHOW INDUSTRY MAKING IMPROVEMENT


COLUMBUS, Ohio (April 8, 2004) –  Leading indicators show Ohio’s steel industry experienced a double-digit rebound in production and shipping in 2003, but those gains continued to be undermined by high steelmaking supply costs that often had a negative impact on earnings.

In its final data report of 2003, the Ohio Steel Council noted that the demand for steel was on the rise while order books at many companies were full, particularly in the fourth quarter of the year.

According to the report, steel production increased 22.4 percent in 2003, from
10.7 million tons in 2002 to 13.1 million tons. For the quarter, steel production rose
52.6 percent, to 3.5 million tons.

Steel shipments in 2003 increased 24.5 percent to 14.1 million tons from 11.3 million tons in 2002. Fourth-quarter steel shipments jumped 63.4 percent to nearly 4 million tons. <p>
An increase in demand for steel, both domestically and on a global scale, played a key role in the production and shipping increase. For example, export shipments from Ohio steel producers to foreign companies jumped 123.5 percent in 2003.

"Ohio steelmakers made significant progress in 2003, buoyed by stronger demand in the fourth quarter,” said Bill Brake, International Steel Group general manager and senior vice president, and a member of the Ohio Steel Council. “The past year truly reflects how Ohio steel producers are poised to compete in the global marketplace. However, a continued emphasis on product quality and reinvestment in Ohio facilities is necessary to maintain this wave of positive momentum.”

In 2003, Ohio steel producers felt the impact of high energy and coke prices, which often times had a negative impact on earnings despite the stronger production and shipment numbers. The final year-end data show that Ohio steel producers spent $400 million on natural gas in 2003 – an increase of more than 48 percent over 2002 – and nearly
$190 million on coke in 2003 – a 64 percent increase over 2002 spending figures. Coke is used as fuel in blast furnaces.

Employment at Ohio's top steel-producing companies grew nearly 4 percent to 16,021 in 2003. This hike can be attributed to the stronger order books and several acquisitions completed during the past year.

The Ohio Steel Council also reported that steel producers continued to invest heavily in their Ohio facilities in 2003. Capital investment spending increased 50.6 percent to $144.1 million in 2003.

The Ohio Steel Council is a public?private partnership designed to strengthen ties among the steel industry, the state of Ohio and its citizens. The Council’s member organizations are AK Steel Corp., International Steel Group, Inc., Ohio Department of Development, Ohio House of Representatives, Ohio Senate, The Ohio State University, PRO-TEC Coating Company, Republic Engineered Products, Stark State College of Technology, The Timken Company, United Steelworkers of America, USS Lorain Pipe Mills, V & M Star, WCI Steel, Inc., and Wheeling-Pittsburgh Steel Corp.