From Lehtinen's resignation from SDI to Aycock's retirement from Nucor.

The past two months have been an exciting time for the steel industry. It started with the resignation on June 13 of Larry Lehtinen, vice president and general manager of Iron Dynamics, a subsidiary of Steel Dynamics Inc. Lehtinen will reportedly pursue other career interests and is said to

But Steel Dynamics, trying to play down Lehtinen's departure, stated that Iron Dynamics will continue to benefit from Lehtinen's expertise which he will be offering to his former employer in his capacity as a part-time technical consultant.

Steel Dynamics also emphasised that all proprietary knowledge acquired by Lehtinen in regard to Iron Dynamics' ironmaking process which involves reducing briquetted ore in a rotary furnace followed by melting in a submerged arc furnace, was protected by a confidentiality agreement. Some experts say that the agreement is intended to thwart attempts to use expertise for purposes other than those serving the interests of Iron Dynamics. "I would not read much into that ... actually, this is the standard thing when a leading executive of a company decides to call it a day," a New York based analyst told Steel Times International on condition of anonymity.

Be as it may, Iron Dynamics executives are upbeat about their company's activities. Although present output of liquid iron is only one-third of the planned capacity, they believe that following planned modifications this summer, the company's innovative scrap substitute process, will create new quality standards for the industry.

NUCOR 62% PROFIT

A piece of good news for Nucor's new president and CEO, Dan Dimicco comes from Charlotte, North Carolina where the minimill group, Nucor Corp, now the second largest US steelmaker, posted a 62% rise in its net income during the second quarter; the rise is attributed mostly to declining prices of steel scrap, a steep increase in its shipments and a reduction in start-up costs for new facilities. Although Nucor achieved a net income of $81.8M during the second quarter of the ongoing year, up from $50.7M during the year-earlier period, its performance still remained slightly below the expectations of analysts.

Nonetheless, Nucor's performance is still rated as impressive, particularly in the face of the fierce competition that is currently raging in the industry and putting pressure on prices. Fortunately for Nucor, it was able to cushion the heavy blow of price reduction by cutting its production costs thanks largely to reduced costs of materials, particularly scrap steel. Nucor has positioned itself pretty well and is poised to boost its earnings in the next quarters.

Nucor's sales soared to $1.21bn during the second quarter, up 22% from $997.2M in the year-earlier quarter. Nucor also made substantial savings in its new start-facilities where it could effect a 17% savings down to $10M from the projected $12.1M. It has also very nearly completed construction of its new plate mill in Hertford, North Carolina, which is expected to go into production in autumn this year. As well as this, it is giving `finishing touches' to the construction of a second caster at its South Carolina based sheet and sections mill. Nucor has also started installation of a second cold mill there which is expected to double the plant's cold-rolled capacity. The Company continues to maintain its pioneering attitude to new technology. It has teamed up with BHP of Australia and IHI of Japan to commercialise direct strip casting. The pilot plant built at Port Kembla in Australia has been transferred to Crawfordsville where it is being enlarged and will be used for commercial production. On the ironmaking front, Nucor has teamed up with the mining conglomerate, Rio Tinto, to develop the Hismelt process, a coal based smelter capable of treating low grade ores and reverts.

ELECTION POLITICS

But the general mood in the industry is one of concern over what some steel executives with a penchant for the hyperbole describe as the `invasion of foreign steel suppliers'.

In an election year in which the US administration can ill afford to incur the wrath of either the industry or the trade unions, the administration has swung into action to protect the interests of domestic steel producers against sharp increases in foreign steel imports. The administration has said that it intends to aggressively pursue anti-dumping measures and provide protection to both domestic steel companies and workers.

The administration released a 240-page report in late July, the intention behind which both political and trade analysts agree is to shore up support from both the steel industry and trade unions for the run to the presidency by Vice President Al Gore.

The report, which was compiled by the Commerce Department, says that the administration will levy duties faster than in the past on imported steel in an effort to obviate or reduce the impact of cheap imports on local steel producers and the workers as soon as there is knowledge of any dumping. Indeed, there is talk of creating, a so-called `rapid response task force which will be charged with providing assistance to communities affected by the steel dumping. The administration has also sought money for the establishment of such a task force.

The US International Trade Commission did point the finger at China, South Korea and other countries for dumping reinforcement steel. However, the ITC mellowed down its judgement on Japan and said that the latter had not engaged in dumping.

The ITC forwarded a report in mid August to the Commerce Department, saying that it had found China, South Korea, Indonesia, Byelorussia and Latvia had engaged in selling reinforcing steel in the United States at prices below the cost of production.

As a result of the ITC ruling, the Commerce Department will continue to probe charges of dumping, and give its initial assessment during the first week of December. Once the ITC finds that there is substance in the dumping charges against a country, the Commerce Department probes further and levies anti-dumping duties to achieve a `level-playing field'.

For a country to be designated as a `dumper', both the ITC and the Commerce Department must independently conclude that a country is engaging in dumping practices.

A group of US steel companies, which levelled the dumping charges, included Birmingham Steel Corp, Nucor Corp, Commercial Metals Co and others.

As well as clearing Japan of dumping, the ITC has also stopped close monitoring of Austria, Russia and Venezuela because imports from these countries was negligible and had no significant impact on the US steel industry, it concluded.

In the case of Japan, the ITC determined that seamless stainless pipes shipped by Japanese suppliers were not hurting US steel companies. The Japan Steel Information Centre, a Japanese industry group, welcomed the ITC ruling, saying that it had been obvious that US steel producers had been unable to meet the demand for this product, and that the steel industry had to rely on imports. There are some 18 companies in the USA that produce seamless stainless steel pipes.

However, in regard to tin and chromium-coated steel sheets, the ITC ruled in August that these shipments from Japan were a threat to US steel companies. Weirton Steel Corp and the United Steelworkers of America trade union had filed a complaint alleging that the steel supplied by Japan was at prices below fair market value.

Complying with the ITC's ruling, the US administration decided that it would impose anti-dumping duties of roughly 95.30% on Japanese companies such as Kawasaki Steel Corp, Nippon Steel Corp, NKK Corp. and Toyo Kohan Co Ltd Other Japanese producers would face a 32.52% levy.

RELATED ARTICLE: AYCOCK STANDS DOWN FROM NUCOR

H David Aycock, acting President and CEO of USA's second largest steelmaker, Nucor Corp, has stood down to make way for Dan Dimicco with immediate effect.

Daniel R Dimicco, age 50, was also elected to Nucor's Board of Directors. Mr Dimicco has been with Nucor for eighteen years, serving most recently as Executive Vice President. From 1991 to 1999, he was Vice President and General Manager of Nucor's successful joint venture, Nucor-Yamato Steel.

David Aycock had been brought back from retirement in January 1999 following the sudden departure of the then President and long time Chairman of the Group, Ken Iverson. Iverson was not the only casualty of disagreements amongst top management, within the year, CEO John Correnti was ousted in a disagreement over Nucor's policy on overseas investments. The new CEO, Dan Dimicco is said to be intending to concentrate on growing Nucor's steel business through acquisitions. Mr Correnti has since become CEO of Birmingham Steel, this time the winner of a boardroom coup, while Ken Iverson, aged 74, seems content to leave the Boardroom battles behind him.

* Peter C Browning, (59), has been elected Chairman of Nucor's Board of Directors, succeeding David Aycock. He has been a director of Nucor since 1999. Mr Browning was President and Chief Executive Officer of Sonoco Products Company and was Chairman and Chief Executive Officer of National Gypsum Company. Mr Browning also serves on the boards of Lowes Companies and Wachovia Corporation.