PRODUCTION AND SHIPMENTS OF OHIO STEEL DECLINE IN FIRST QUARTER OF 2007 BUT UP SLIGHTLY FROM 2006; EMPLOYMENT AND  CAPITAL SPENDING ALSO DOWN

COLUMBUS, Ohio (July 24, 2007) –  Production and shipments of steel manufactured in Ohio decreased during the first quarter of 2007 compared with the same period in 2006, the result of weaker demand and higher costs for energy, scrap and raw materials, according to the Ohio Steel Council’s quarterly and year-end data report. Production and shipments for all of 2006 showed gains over 2005.

For the first three months of 2007, production totaled 3,405,771 tons, a drop of 10.9 percent compared with the first quarter 2006 total of 3,822,370 tons. Producers shipped 3,659,998 tons, a decline of 11.64 percent from first quarter 2006 shipments of 4,141,992 tons.

“Results for the first quarter of 2007 reflected a somewhat weaker overall economy and higher customer inventories compared to what we were experiencing at the start of 2006,” said Alan McCoy, vice president, government and public relations for AK Steel Corporation. “In addition, energy and raw material prices were at historic highs, adding to the challenges facing Ohio’s steel industry.”

Average employment during the quarter fell 7.35 percent to 13,373 from 14,434, while capital investment spending totaled $52,848,134, a drop of 21.53 percent compared with expenditures of $67,347,591 the previous year. Payroll increased 5.07 percent to $248,670,122 from $236,681,204.

During 2006, Ohio’s steel manufacturers sustained and built upon the high-water marks in production and shipments achieved in 2005. Production totaled 14,740,749 tons, an increase of 1.38 percent over the previous year’s total of 14,539,475 tons. Manufacturers shipped 15,609,197 tons, up 1.29 percent from 2005’s total of 15,410,491 tons.

Employment fell by 7.93 percent for the year to an average of 13,954, versus the 2005 average of 15,157. Capital expenditures for the year were $297,229,712, a drop of 5.77 percent from the 2005 total of $315,416,511.

The fourth quarter of 2006 saw an increase in capital investment spending compared with the same period in 2005, but declines occurred in other categories. Capital spending grew by 56.13 percent to $109,306,721 from $70,010,625. Steel production was down 16.10 percent to 3,177,996 tons from 3,787,868 tons, while shipments showed a drop of 12.78 percent to 3,412,371 tons from 3,912,475 tons. Average employment was down 9.24 percent to13,698 from 15,092, and payroll declined by 3.8 percent to $223,214,819 from $232,026,196.

The Ohio Steel Data Report, compiled by Youngstown State University’s Center for Urban Studies, covers statistics from Ohio facilities of the Council’s steel-producing members. The data is forwarded to the Ohio Steel Council in aggregate, so the contribution of any single company cannot be determined. For more data and past data reports, visit www.ohiosteel.org.

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., Lorain Tubular Operations (of United States Steel Corporation), ArcelorMittal, Ohio Department of Development, Ohio House of Representatives, Ohio Senate, PRO-TEC Coating Company (joint venture of U. S. Steel and Kobe Steel), Republic Engineered Products Inc., Thomas Steel Strip Corp., The Timken Company, United Steelworkers, V&M STAR, WCI Steel, Inc., Wheeling-Pittsburgh Steel Corp., Cleveland State University and The Ohio State University.