Hello, and welcome everyone to today's Commercial Metals Company Third Quarter 2011 Earnings Call. As always, today's call is being recorded. [Operator Instructions] I would like to remind all participants that during the course of this conference call, the company will make statements that provide information other than historical information and will include projections concerning the company's future prospects, revenues, expenses or profits. These statements are considered forward-looking statements under the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995 and may involve speculation and are subject to risks and uncertainties that could cause actual results to differ materially from those projections. These statements reflect the company's beliefs based on current conditions but are subject to certain risks and uncertainties that are detailed in the company's press release and public filings. When possible and as necessary, during this call, we will identify those forward-looking statements, which are based on management's current expectations and other information that may be currently available. Although CMC believes these statements are made based on management's expectations and assumptions, CMC offers no assurance that events or facts will happen as described here or are wholly accurate without exception. More information about risks and uncertainties related to any forward-looking statements can be found in CMC's latest 10-Qs, available on both the company's and SEC's website, and all statements are valid only as of this date. CMC does not assume any obligation to update them or as a description of future events, new information or otherwise. And now for opening remarks and introductions, I will turn the call over to the Chairman and CEO of Commercial Metals Company, Mr. Murray McClean.

Thank you, and good morning, everyone. Thank you for joining us to discuss CMC's third quarter results. With me today are Joe Alvarado, President and Chief Operating Officer; Barbara Smith, who recently joined as a Senior Vice President and Chief Financial Officer; and Bill Larson, our CFO Emeritus. I'll begin the call with some high-level comments on the third quarter, and then I'll ask Joe to comment on our operations, followed by Barbara who will provide financial details and Bill who will offer some comments as well. I'll wrap up with some comments on our outlook for our fourth quarter and year-end 2011. After that, we will be happy to answer questions. Overall, we had a very positive quarter with significant improvements from the second quarter 2011 and a major turnaround from our third quarter 2010 performance. I'm pleased to report that 4 of our 5 business segments were profitable in the quarter. The fifth segment, Americas Fabrication, reduced its losses significantly. In a few moments, Joe will provide an update for you on the operational drivers that supported the improved performance this quarter. In addition to operational improvements, good seasonal demand, combined with real demand increases, resulted in higher prices and better margins across the business. Throughout the supply chain, inventory levels are low to normal, so any increase in demand is immediately felt. Our major capital investments in Poland and our micromill CMC Steel Arizona are showing improved profitability. In addition, CMC Sisak, Croatia has been consistently reducing its losses quarter-over-quarter. However, it still has some way to go to reach break even. Domestically, we are seeing a positive impact from the actions we've taken in previous quarters. These actions have produced strong results in the recycling, mill operations and fab operations overall. With ferrous scrap and steel products pricing dipping slightly at the end of third quarter, prices appear to have stabilized and are trending higher in June. We expect to see prices for rebar and merchant products increase effective July 1, 2011. To sum up, we are pleased with our improved performance during the third quarter, even more so given that we reported these results in a global economic environment that remains challenging and somewhat about to fall [ph]. Overall, we delivered much stronger performance during the third quarter than we expected. We benefited from our exposure to global markets and our vertical integration, and we also optimized our product mix. And with that, I'll turn it over to our President and Chief Operating Officer, Joe Alvarado. Joe?

Thank you, Murray. Let me begin by reiterating Murray's comment that our third quarter 2011 was much better than anticipated, as we realized a significant improvement in earnings, both quarter-over-quarter and year-over-year. International trading activity was strong. Both orders and backlog are higher across most lines of business. This includes steel treating, which is also showing improvement over last year, with strength in SBQ and tubular products driven primarily by higher demand from energy markets. We've talked in the past of improving our product mix, and this was achieved in the third quarter. Capital investments that we made in Poland, for example, are producing more merchant products that are in strong demand throughout Northern Europe, particularly in Germany. Our sales of wire rod products have also increased. As projected, losses at Sisak in Croatia are lower quarter-over-quarter than last year. CMC's operation in Croatia had an adjusted operating loss of $7.2 million this quarter, and the demand for line pipe remains weak. However, our technical teams continue to develop process improvements and implement cost reductions that will help further reduce the loss and get us closer to break even. Of course, being profitable at that operation is the goal. Performance in the Americas has benefited from increases in demand and improvements in operational efficiencies. The average mill utilization rate for the quarter was 73%. The organizational changes we made were designed to create clear focus within each operation, marshal the assets of the entire supply chain on a regional basis and make cross-functional management directly accountable for bottom line results. These changes have helped the team deliver higher operating rates compared to last year, stronger performance on our Scrap business and increased sales for rebar and merchant bar. These changes, coupled with higher pricing, enabled us to reverse some job…

Thank you, Joe, and good morning, everyone. As mentioned, third quarter earnings for 2011, which ended on May 31, we reported a significant improvement over the same quarter a year ago. Our earnings were $36.2 million or $0.31 per diluted share, on net sales of $2.1 billion. This compares to a net loss of $8.8 million or $0.08 per share, on sales of $1.8 billion reported for the third quarter 2010. This year's third quarter results include an aftertax LIFO expense of $3.9 million or $0.03 per diluted share, compared with an expense of $22 million or $0.20 per share during last year's third quarter. Net loss for the 9 months ended May 31, 2011, was $9.3 million or $0.08 per diluted share, on net sales of $5.7 billion. In the same period last year, the company had a net loss of $213.3 million or $1.88 per share on net sales of $4.5 billion. For the first 3 quarters of 2011, our aftertax LIFO expense was $44 million or $0.38 per diluted share, compared to an expense of $16 million or $0.14 per diluted share last year. Collectively, our steel mills generated an adjusted operating profit of $67.6 million, compared to $12.8 million during the same period last year. We benefited from pretax LIFO income of $6.1 million, compared to an expense of $21.7 million for the third quarter of 2010. Metal margins improved as well, growing from $289 per ton during the second quarter of 2011 to $320 per ton during the third quarter. The margin was $280 per ton during last year's third quarter. Many of you have been tracking the progress on our new micromill, CMC Steel Arizona. We've been able to sustain profitability through the third quarter after crossing this threshold late in the second quarter.…

Thank you, Barbara. Financially, we feel we're in a strong position moving forward. While we are very pleased with our performance during the third quarter, as noted in the press release, the fourth quarter is normally a seasonally slower period. As such, our results in the fourth quarter are not expected to be quite as strong as the third quarter. At this time, I'd like to acknowledge and thank Bill Larson for his 2 decades of outstanding service to CMC and especially for his leadership and capable guidance as Chief Financial Officer for the past 12 years. In particular, over the last 3 years of recession and financial turmoil, Bill has kept CMC safe. So many thanks for a job well done. Bill, would you like to make some comments?

I can't pass up the opportunity to make comments, you know, Murray. I'd like to say thank you to all the people who sent me notes and called me with a lot of kind words upon reading the transition notice. I’d especially like to thank the 2 of you who called to ask if I was dying. I have been very blessed with 2 careers, both of which were connected with Commercial Metals. I spent 16 years at Touche Ross, which became Deloitte, and Commercial Metals was a client of mine for those 16 years. I had a great chance to have mentors on this account and at Deloitte, Clement Semer [ph], Bob Grant [ph], Jim Taper [ph]. And then 20 years ago, when I joined Commercial Metals, I had an opportunity to have again another great set of mentors in Jack Mollies [ph] and Larry Engels and Stan Raven [ph]. But there comes a time when you ask yourself what you have accomplished and if the same opportunity you were given when you were younger shouldn't be given to someone else. And I approached Murray probably 14 to 16 months ago and mentioned to him that there will come a time in the future, and we didn't decide when that was necessarily then, when I would like to rotate out of the CFO's job and give someone else the same great opportunity that I had. We were very fortunate as we did our search to land someone of the capabilities of Barbara. We have undoubtedly upgraded the position. We're very lucky to get her, and I feel very fortunate that the CFO's position is in very good hands. Several of you have asked what does the future hold for me. I will be here at CMC until 12/31 doing various transition responsibilities. After that, I may seek out director positions. I may go back to school. I don't know. I'm going to keep things open. On a little different note, Commercial Metals lost one of its iconic leaders last week with the passing of Leo Howell at the age of 90. Mr. Howell started our copper tube division in New Market, Virginia and he became a part of CMC in the mid-1960s. For many years, he was the Chairman of CMC's Executive Committee, joined by Stan Raven and Marvin Selig. He was a man of wisdom, of calm, of uncompromising character and a staunch defender of the company. His influence lives long throughout Commercial Metals Company. He was a gentleman. Murray?

Thank you, Bill. At this point, we'd welcome any questions that you may have.

[Operator Instructions] Our first question comes from Brent Thielman from D.A. Davidson.

Just a question on the -- you mentioned constraints to outflow related to the flooding in the Midwest and just wondered if you started to see that supply open up yet. Do you think this weighs on recycling volumes in Q4?

We're seeing flows very well. There's some extraordinary situations, Brent, like we've experienced in Joplin, Missouri, because of the tornado where we're tasked to help with some of the collection and restoration efforts. But for the most part, flows are good, and while flooding is a factor, it's not disruptive to the point that it will present any problems for us. And of course, it will fairly subside on a fairly short order.

And then in Americas Mills, you mentioned the strength in certain regional markets. Can you talk a little bit more specifically where you're seeing that strength, and is that kind of continuing here into the second half of the calendar year?

Yes, Brent. The strongest market for us still remains our central region, which is the Sagene [ph], as well as the Magnolia, Arkansas, rolling mills in Fab business and Recycling. We see pockets of strength in the East Coast, and our mill operating rates are very high on the West Coast. But the Fab business is pretty challenged there. So while there's spotty good business, there are plenty of areas in the country where we'd like to see stronger demand which is reflected in the operating rates, which, while they're above 70%, the lack of demand prevents us from being able to run at higher rates than that.

Sure. And then just lastly if I could. On the Fabrication segment, your average selling price was like $839 per ton in the quarter, which is a nice jump sequentially and year-over-year. Is it fair to say your backlog is priced significantly higher than that, or any color there?

No. Actually, we still have a lot of lower-priced material in our backlog. The backlog that we carry can go out, at least on highway projects, a couple of years. We're pricing new orders at those levels or slightly higher. That's an average price. And that's with all the value-add activities that we might be engaged in as well, including coating. So while there's some orders on average that are higher than that, the entire backlog does carry some lower weight fabricated products.

And you might mention that actually the mix, it's a little deceptive in terms of. . .

Yes. And in terms of shipments, too, and that's a good point, Bill, when we talk about our backlog and what's in the backlog, we have a lot of what I just described as highway business that’s lower priced. It doesn't represent the same percentage of our shipments on a monthly basis. So our entire backlog might have an untraditionally a larger amount of highway work, about 70%. But our shipments on a monthly basis are probably closer to 50% highway, 50% commercial activity. So we've seen some good commercial activity still in the Texas market, in particular.

Okay, that's helpful.

Our next question comes from Timna Tanners from Bank of America Merrill Lynch.

I wanted to say good luck to Bill in his next venture and hope that goes well, and welcome to Barbara. I had 2 questions, if I could. One is really if you could talk a little bit more about the seasonality. I was not clear on what drives the seasonal weakness that you mentioned. I haven't always seen that. So I just wanted to understand that a little bit better.

Timna, good question. I mean in normal markets, I would say the fourth quarter is as good as the third, sometimes better. But certainly, since the recession as you know, the commercial activities in the U.S. are well down on what they were. Internationally, we do see a seasonal slowdown in Asia. A lot of that's to do with the seasonal effects like the monsoon which starts, as you know, in May and moves all the way up -- in Southeast Asia, all the way up to Japan by August. Also in Europe, July, August is a holiday period, and so things normally slow down. We anticipate June to be a very good month for us, but we think things will slow July, August. So that's why we mentioned the fourth quarter we anticipate to be down on the third quarter but still a good quarter.

Okay. Some more in the International business, impact there. Okay, makes sense.

Yes, and some in U.S., too, because we're not back to what we were in say 2006, 2007 period.

Okay. There's been some questions, I've heard at least on the understanding on how to think about the corporate eliminations. I hope I didn't miss anything on this. Just trying to understand what drives that line and why the sequential increase into the May quarter?

Yes. Thank you, Timna. As noted, it is up on a sequential basis. There were a number of factors in the third quarter, I would call them sort of unusual or project related. We did have some increases in our IT expenses. We had some increases in our legal areas. We defend this antitrust lawsuit. Another factor, of course, is the increase in sales, which drives our sales incentives, and we did hit some trigger points where those incentives needed a boost in their accrual rates on a year-to-date basis. But for modeling purposes, I think using $18 million to $20 million per quarter, excluding eliminations, is probably an appropriate number.

That's really helpful. Okay, great.

Our next question comes from Brian Yu from Citi.

Bill, we'll miss you, and Barbara, welcome back to the public arena. So I've got a couple of questions. This one is probably even more for Joe. With Croatia, I know you guys are making progress with the turnaround, but if you can disaggregate between more the cyclical economic drivers versus what you can actually do to improve the Croatia operations, how far along would you say you're in this turnaround process? Halfway, maybe 2/3? Can you give us an idea?

Brian, we've made significant progress on our operating efficiencies. And all the traditional measures with the yield productivity, any throughput measure, both in the pipe mill, as well as the melt shop. We're challenged in the melt shop to a degree in the sense that we don't see the same sort of benefits in Europe, in Croatia specifically on power rates being better or more advantageous on the weekends. It's a little bit of an advantage in the evening. So we're running the shop as best as we can with what's available to us. And the issue for us in terms of our turnaround there is we got to have some relief on the price side, as well as on the cost side. So we've made good progress in costs, but revenues and margins, while they're improved, are not at the level that we'd like to see them, and partly it's because commodity markets for a nonvacuum to gas bloom product render us somewhat limited in our ability to sell bloom product. And of course, on the tubular side, with the restrictions in the EU, most of our product is exported. And so freight becomes a big detractor from our average realizing prices. So we're making good progress, and the announcement that the EU has accepted or will accept Croatia following the ratification into the EU is positive, but that's still a good 18 to 24 months out. So we're dependent on line pipe product in particular in the energy market and not OCTG. The premiums for OCTG are significantly better, but we're not capable of producing those products on a consistent basis. So we're relegated somewhat to line pipe, which minimizes or potential for, again, higher revenue and higher margins. So we're making good progress. We need a little bit better market, and entry into the EU would be of great benefit to us but by itself isn't the singular solution. So I hesitate to put a percentage on how far we've come. We’re certainly pleased with the progress, but we've got a long way to go.

Okay. So it sounds like in terms of operationally, that you fixed most of the issues there and at this point, it's more up to market factors to drive a turnaround than something specific to CMC.

There's some room for additional operational efficiencies. I mentioned the melt shop in particular. If we could run the melt shop full out and sell more bloom product, that would really help our cost significantly. We're limited, however, by the product offering that we have as well as demand in Europe. While we see good demand for merchant and rebar products in Northern Europe, Croatia's a little bit more in line with Southern Europe, and so some of the companies to whom we might sell our bloom product as rounds in Southern Europe are struggling more than Northern Europe. So it limits some of our opportunities by virtue of the economic downturn in Southern Europe. So we could get more efficiencies if we can run a little bit harder. But doing that in the economic environment we're faced with in Southern Europe is a little bit more difficult and problematic.

And then on the fabrication side, with the new projects that you're adding to the backlog, I know in the past it's been pretty competitive. Can you talk about the incremental projects that you're adding online? Are those offsetting the steel price increases that we've seen so that those should be more profitable?

Yes. We've been able to at least, through the last quarter, improve our margins and cover the costs, more than cover the cost of raw materials. That's a market that can be very challenging at times. That's why I tried to point out, Brian, that regionally, there are really significant differences in our ability to pass-through complete price increases. The East Coast, for example, can be very, very competitive in some areas. In other areas, like I'll use the Washington D.C. area, in particular, are being a little bit stronger. But Georgia still struggles, and Florida struggles with competitiveness and project availability. In the central region, where we see more commercial work than would be apparent from our backlog, that's all short lead time business. So back to Murray's point about the fourth quarter and the seasonally lower, we just don't have a lot of order visibility. Some of those projects come up short, and because of our availability, we're able to respond. And that's what helps to increase our share of commercial work as part of our total shipments in any given quarter.

Got it.

Our next question comes from Arun Viswanathan [ph].

I just had a question. Can you elaborate maybe on the early comment about the inventory position? Were you referring to your own inventories or customer inventories? And has that changed quarter-over-quarter?

Could you be little bit more specific, Arun [ph]?

Sure. I think Murray was referring to loan forays [ph] across the industry? And so any demand uptick would be immediately felt. I mean, has that continued through recent months?

Yes, it has. I mean we look obviously not just in the U.S. We look internationally as well. In most markets, customers are relatively cautious and carry positively [ph] low inventory. They rely on the mills more to supply the inventory. So it's just not a phenomenon here in the U.S., it's also in international markets. Now there are some exceptions, particularly on flat products in international markets which we trade. We see some inventory levels there in some markets relatively high. But most products -- certainly long products, inventories are low whether it's rebar or merchant products. So any tick up in real demand, we feel it almost immediately. So that was what that comment related to.

And how would you characterize that real demand, I guess, coming out of the quarter? I mean, I know that you commented that seasonality is probably going to be a negative impact. But what's your expectation on the real demand side going forward?

Well, we think it's going to be reasonable. Not great, but it's going to be reasonable. Obviously, there's still a quite few headwinds out there, but certainly, when you look 12 months ago, it's a significant turnaround. So as I said, we think our fourth quarter is going to be quite good but not up to the pace of the third quarter.

Okay. And then I guess subsequently, there's been some, I guess, weakness in the spot pricing of hot rolled. Have you seen any of that, and has that stabilized potentially with scrap stabilizing?

Well, I mean clearly we aren’t in flat products as a producer. We do trade flat products but yes, we do see on the trading side that has definitely come off. The reverse is true on long products. We see price increases here in the U.S. effective July the 1st, as we mentioned on rebar and merchants. And in international markets, rebar and long products like in China remain relatively firm, whereas flat products have come off. Clearly, in markets like Poland, which is a very good market in Germany, long products pricing has also firmed. Flat products seem to be in that part of the world, relatively stable.

I was going to say certainly, Arun [ph], in the U.S. markets, the added capacity would have to be putting some pressure on the market, but we've seen hot rolled prices throughout the world decline. So it's consistent.

[Operator Instructions] Our next question comes from Martin Englert from Jefferies & Company.

Wanted to see if you had any new strategies to manage any potential cost price mismatch in the Fabrication segment?

Well, there are several things that are available to us to try and mitigate those kinds of squeezes. One is taking a physical position, which was the common practice for Commercial Metals for a long time. There are financial instruments that we have available to us. And the physical positions that we've taken in the past, Martin, have been really on the rebar side. We're exploring the financial instrument side of it, as well as some physical inventory positioning for exposure that we have, trying to match it up. But the key to that is having the availability. I mentioned that the central region is a good market for us. So building physical inventories is not as practical as it might be, for example, on the East Coast. So we look at all those instruments as a means of mitigating, and we'll employ them from time to time each and every way to try and lock in some margin.

Do you think that on the financial instruments side, that's something that you're looking more at implementing, or is it more so on the testing phase right now?

It would be more on the future side of it as opposed to past. We've locked in some of our prices in long-term pricing. So locking in a margin that doesn't exist based on higher raw material pricing doesn't make sense. But if we see opportunities to take advantage of deterioration in scrap and/or rebar markets, we would certainly do that.

Okay. And kind of looking at the scrap export environment right now, any changes out there that you've seen from any specific countries or the overall environment?

The second quarter, there were issues obviously in the Middle East, which impacted Turkey in their ability to absorb or to purchase scrap for export of rebar products into the Middle East. That seems to have subsided. And so some of the demand has been restored. There've been an increased activity of scrap shipments outbound, less in the way of inbound rebar imports than we've seen in the past or certainly in the second fiscal quarter.

Okay. And then lastly, just to follow-up on that. Any indication what the scrap inventory levels are like over in Turkey right now?

No, I don't have anything on that. I can't tell you.

The Turkish domestic market is being quite strong. And as they push their prices up for rebar significantly in June. So not just Turkey, some other nearby countries as well. Obviously, there are exceptions like Libya, but countries like Egypt have started to come back buying rebar. Saudi Arabia, et cetera, is quite good. The United Arab Emirates is also quite a good market. So some of those markets come back. But Turkey is domestically, as I mentioned, has been quite a strong market the last month or 2 now. That should quiet down as they get to Ramadan in August, September period. So it's not sustainable, in our view. We think those markets will start to taper off in the next month or 2.

So Martin, while we don't have inventory figures, they are buyers today.

Excellent. I appreciate the color.

Our next question comes from Sandeep S.M. from Goldman Sachs.

I had a question on the fab metals. So you commented that the prices there, with Rebar pricing you definitely intend [ph] that helped you improve the performance in fabrication. So from this point, if the prices sort of remain stable, is it possible to produce further improvements in that division or how should I look at it?

Well, you're talking about the domestic fabrication then?

Yes.

I mean if it were a perfect world, and it’s not a perfect world as you probably know, if prices stabilized then yes, the operational results would get better. But Joe has already mentioned that we have a significant backlog, and it does matter what gets shipped in any particular month or any particular quarter. But yes, stable pricing would inevitably lead to better profitability in that division, no question about it. It's just a question of when the backlog that's at lower prices got run out. And as Joe said, we've got a couple of years of highway work that is still there.

Okay. And on the scrap prices, scrap price has remained quite strong this year. So looking ahead, I mean seasonally, they've been expected to fall but they haven't really. So looking ahead, I mean what is the outlook on scrap prices?

Well, we think scrap prices are related to iron ore prices, and you look at China, spot iron ore prices remain relatively firm, around about 180 thereabouts. You're right, I mean we would expect scrap normally between May and July comes off. It hasn't done that. I mean it went down 15, it's really come back 15. It could well move down. We don't think in July but in August, scrap prices could drop. And as they say, it's related to iron ore prices, and they still remain relatively firm. And in big markets like China, even though they're trying to slow down demand, certainly on long products, the demand is still there. So, I don't know. We don't see scrap coming off in July, but possibly August, and then it will reverse. The prices will start to pick up again September, October period. So you're correct, from January of this year, scrap peaked -- shredded at about 470 and dropped to 435. But it's come back into the 450, 460 range. So it's been relatively stable since January.

Okay, that's very helpful. And the guidance that you gave for fourth quarter, just to check it. You were talking about the operating profit, that will be excluding the LIFO, right? Or like when you said fourth quarter will be equal and the third quarter, should we look at it excluding the LIFO or including it?

I would look at it excluding LIFO.

Okay, perfect.

We never plan for LIFO because that's almost impossible.

Yes, I know.

Our next question comes from Aldo Mazzaferro from Burke & Quick.

Welcome to Barbara, and congratulations to Joe and to Bill on all the events taking place and with Joe's promotion. I just had a question on the scrap market so I wanted to follow up a little bit further. Can you talk about how you see the supplies of scrap at the domestic mills these days?

Yes, Aldo. We read all the same reports that you do about what people are doing with inventory. Flows are pretty good. We don't see any issues. Turnover's really pretty good. These prices, scrap does move fairly fluidly. There's a little bit of pressure because of export, but I've not heard of any pockets of tightness, if that's what you're asking for or overbuild. Just don't have any sense for that.

So pretty stable and fairly normal levels, would you say?

Yes.

Yes. I'll just add to what Joe is saying, Aldo. Certainly, we're seeing in June shipments of finished goods are pretty strong, anticipating the July the 1st price increases. So that'll draw down on scrap, but that's only a temporary thing, and I think it will stabilize again in July.

Great. That's the other side of my question. I noticed we're in the second month of a little bit of a surprising uptick in scrap, I think counter to most expectations. And I'm wondering, are you seeing any impact on a global basis? I know Turkey's come back, but I'm wondering whether the absence of some of the Chinese -- I'm sorry, the Japanese scrap that has been exported from Japan now post the earthquake and the tsunami, whether maybe a lack of supply out of Japan is causing a little bit more buying to come to our shores?

I think there's some impact there. But if you look at Japan, most of their scrap goes to South Korea, Taiwan and China, and maybe some other Asian countries. So it's pretty regional. But certainly Turkey has been the big surprise, and a lot of that, as I mentioned earlier, is due to their own domestic market. They came in very strongly, as you know, in May, late May, early June, buying scrap. So that was a bit of a surprise, and that pushed up, as I mentioned earlier, the rebar prices and merchant prices significantly. So the flip side of that is that we'll see very little rebar from Turkey coming to this market in the U.S. July, August, September. We saw significant quantities come in the first half of this calendar year, rebar that is from Turkey. So I would say Turkey has been the big surprise factor in the amount of scrap bought in the last -- past few weeks.

Great. Have you seen any new interest from the Chinese or from the Koreans?

Not really. I mean, China I think is at the levels where scrap is. They're not a buyer. If scrap drops towards the $400 a ton or certainly below $400, I think the Chinese would come back and buy. But at these levels, they are buying but not significantly.

Okay. And finally, what do you take for a direction in scrap price for July, up or down? What would you say?

Well, at this stage, probably sideways, maybe slightly up. But it's unusual. As I mentioned earlier, I think there's a normally correction between May and July, and it hasn't happened this year. So maybe it will be August when there's a correction.

And that concludes today's question-and-answer session. At this time, I would like to turn the conference call back over to Mr. McClean for any closing remarks.

Thank you for joining us on today's conference call. We look forward to meeting with many of you in our investor meetings in the coming weeks.

Thank you very much.

The conference call has now concluded. We thank you for attending. You may now disconnect your telephone lines.