Once CCI's mine is up and running - things will be looking very...

Once CCI's mine is up and running - things will be looking very good for significant revenue ...Market is certainly there ;

Turbulent Times in the Stainless Steel Market
(updated 12/19/05)

Prices and availability of stainless steel have been fluctuating for several months and continue to do so for a variety of reasons. The purchase and consumption by China of raw materials used for making stainless steels have increased dramatically, the current devaluation of the US dollar, deficits in the supply of nickel and the closing of a large US plant for the production of stainless steel plate, are all factors that have contributed to the volatility. This uncertainty in the market has required suppliers to increase the surcharges applied to price quotations and has lengthened lead times to obtain both commodity and specialty stainless steel materials. As a consequence, companies in the manufacturing sector, such as A&B Process Systems, are finding it difficult to provide bids and/or quotations to potential customers for any great length of time.

The Volatile Stainless Steel Market.
The manufacturing industries in North America are presently facing widespread increases in the prices of all stainless steel materials. The volatility of the market has negatively influenced business practices. Today, stainless steel suppliers will generally guarantee a price for only five days and in some cases, for even shorter times. The surcharges being applied have increased markedly for both 304 and 316 stainless steels. For example, from mid - 2003 when surcharges were $0.16 for 304 and $0.24 for 316 stainless steel materials, there has been a steady escalation, reaching $0.66 and $1.58 for 304 and 316 respectively in July 2005. Over the same period lead times have been extended to 10 - 12 weeks for commodity materials and 12 - 16 weeks for specialty steels.

What has Contributed to the Market Volatility?
There are several factors that have contributed to the present situation in the market for stainless steel;

The demand has increased substantially in the United States , Europe, China and Korea.

China and several other countries have limited the export of raw materials used in the production of steel, e.g., iron ore, coke (coke is a form of amorphous carbon, obtained by the controlled heating of coal, used to chemically reduce iron ore in a blast furnace. Pig iron, the product of the blast furnace, is then oxidized to steel using oxygen to react with the impurities).

The cost of other raw materials has also escalated over the last 12 - 18 months, in particular, the cost of nickel metal. The average annual price of nickel metal has increased from $2.70 per pound in 2001 to $7.27 per pound in the first quarter of 2005. Chrome has also increased substancially in price.

A significant economic event in 2003 was the rapid decline of the US dollar against the euro. The dollar continued to fall through 2004, approaching record lows against the Swiss franc and the Japanese yen, as well as the euro.

At the end of 2001 Allegheny Ludlum closed a major stainless steel facility in Houston , Pennsylvania , eliminating approximately 250,000 tons of melt capacity. Some twelve months later, Allegheny Technologies, one of the largest and most diversified producers of specialty steel in the world, closed its' plant in Massillon,Ohio, used for the production of stainless steel plate.

The steel industries in the United States also face higher manufacturing costs, due in part to higher energy and transportation costs as well as the rising cost of healthcare for employees."