Welcome to BlueScope North America, and specifically welcome to Delta, Ohio, and North Star BlueScope Steel. It's a pleasure to have you guys here, and as I said last night, for those that were there, this is exciting for us. We've got a lot to show you today and tomorrow. There's a lot of ground to cover. I'm gonna spend the least amount of time that I can up here because you guys see enough of me. This is about you seeing Kristie and her team and the facility. You're not gonna see much of me, but that's the intent of the day. Just a couple of housekeeping things. Facilities are out left. You'll bump into the men's locker room for the boys. If you go left again, you'll then find men's and ladies' facilities. It's okay to use the men's locker room, that's fine for the boys. Out left and left. We've got coffee. Many varieties of coffee out there, cinnamon coffee, Nicaraguan coffee. You can get whatever you want up the back. We've also got some breakfast there, feel free to get up and go and grab something during the session if you like. That's okay. I know the service wasn't amazing at the restaurant this morning. We caught them on the hop a bit, some missed out, feel free to help yourself to some breakfast. Later today, we'll get out on site, which is a really important part of this opportunity. We've got a whole bunch of boots over there, lots of PPE up the back. Jeff will come and talk to us and give us a safety briefing at that stage. I won't spend any time on a safety briefing now. We'll do a safety briefing before we go on site, both here at the mill, this afternoon at the recycling facility, and then at the coating lines tomorrow. This is being recorded, we'll run through the process and record it so we can put it up on the website, and those that couldn't be here can see it. It's being recorded. What we might do is just run through the presentations. They're not super data heavy. We'll get to some Q&A breaks where you guys will have an opportunity to ask any questions of any of the team. We're well represented here today. Kristie, of course, and members of her team are here, so we can cover off any of the questions. After lunch, and the tour here, we'll head across to recycling, which is literally just across the road, do a walk around the recycling site and then have the opportunity for Q&A there again. That's how we're gonna run today, and, as I said, delighted to have you all here. Did I miss anything, Gibbsy? I think that's all of the... Good. Okay. We've got all of the information covered. I'll do a quick overview. I'm gonna hand over to Kristie. She'll then do an overview of North America. Conrad's here will talk about North Star, and then we'll have morning tea, Q&A, and then get to do a walk around, which will be fantastic, and some lunch. Perhaps just a little bit from a BlueScope perspective. Many of you guys have seen this before. Oh, sorry, the one thing I did forget to mention is we will also give you an envelope with the tickets for the baseball tonight. The baseball's a walk from the hotel. Mark and Gibbsy did it on the weekend and assured me it's doable. We're gonna walk to the baseball. We should be back at the hotel. About five. About five? Yeah. The baseball kicks off at about six. Six. You'll have tickets in your envelope to a seat in the stands and a dining area, which we've got booked out so you can go and have something to eat and something to drink. You've got options tonight, and it looks like it's gonna be an amazing night to be at the baseball. We'll hand those out during the day. BlueScope. You guys know this story. We consider ourselves a different kind of steel company. Very much purpose-led, an enormous focus on sustainability, and I'll touch a little bit on the New Zealand announcement in a few slides, a really exciting step forward for us from a climate and sustainability perspective. We've got a suite, we think, of very high quality assets, and you're gonna see one of the very best in the steel industry in North America today. There's no question about that. Lots of work around our technology, branding, and channels, and introducing that here and tomorrow when we're at Middletown with John and his team. You'll get an update on just what's going on in our thinking around how we're gonna introduce a packaged and branded offer into the market in the painting space. A very strong balance sheet and financial disciplines, and really trying to get that balance right between returns to shareholders, investing in long-term sustainable growth in the organization, and you are sitting in part of that investment in the long-term growth, and you'll see that later today and tomorrow, of course, with our, with our coatings business. Our purpose, which rolled out during COVID, it was a project that we felt was important to run as we went into COVID. I've got to say, surprised me, the impact it's had inside the organization. It's very much become a calling card for our people. They're rallying around it. It's resonated within the organization. It works beautifully with the bond, which of course was first written down on a piece of paper when we spun out as a standalone company back in 2002. Our strategy hasn't changed. Within the broad framework of the strategy piece, I mean, lots and lots of different work going on, transforming the organization, whether that's digital, and you'll see some of that today. Fascinating to see a new slab caster identical to the original slab caster built some 20 years later and the advances in sensors and monitoring that goes on in that technology. Equally, what's interesting is the work the team have done here, for example, around the slab caster, where the original equipment manufacturer said to us when they came back, "You shouldn't be able to do that with that caster. I mean, what you guys are doing, it's not designed to do. It was never built to be." At that level of capacity. The incremental improvements that continue to happen in the business as we transform, whether it's digital, whether it's continuous improvement, is a fundamental part of what we're trying to do in the organization. Kristie and her team, very focused around the customer, and the customer experience in North America as well. Continuing to grow the business. Again, we're gonna show you firsthand over the next 48 hours the growth strategy here in North America. Equally, work for us to do in the ASEAN footprint. We're seeing better results in the second half, specifically out of Thailand. Thailand's having a good run. It's a business, and I had a conversation with a couple of you last night, it's a business that we are asked about occasionally in terms of is it really worth the effort. I continue to be excited about the ASEAN business whenever I go there and see what's going on. The opportunity, I still believe, is massive. It's not a huge drain on the organization in terms of management time or distraction, which has been raised with me before. I think the potential in the ASEAN business remains. There's an execution component on our part where we need to improve, but also some of the macro, particularly post-COVID, the China restart, which has stalled, having an impact on that business. The conditions and the signs there are more positive in the second half, I think fundamentally, the strategy for us to continue to hold that suite of assets and take advantage of the growth and the opportunities that we see, not just in ASEAN, but in India and China as well, remains a key part of our thinking. In Australia and New Zealand, less about non-organic growth, more about organic growth. Continued growth in share of Colorbond and COLORSTEEL across the two markets. Continued growth in residential steel framing, which we're excited about. That underpins an investment in MCL7, which we're in the final stages of doing the review on, because we expect to see a significant growth in volume in residential steel framing as we go forward. Continuing to deliver a safe workplace, and a strong balance sheet and returns to shareholders. Very much a consistent approach from a strategy perspective, but below the water, lots of moving parts. You will see, as I said, the growth component from a North American perspective, up close over the next 1.5 days. Sustainability continuing to grow in importance in the business. I think yesterday's and now Sunday's announcement in New Zealand is a very important step for us, both in New Zealand, but also for the organization. These are the major areas that we're focusing on from a safety from a sustainability perspective. Clearly, climate action continues to be at the forefront. There's been a lot of work going on in the last four or five months, in particular, the Safeguard Mechanism in Australia. The announcement that we made in New Zealand on Sunday. There's a lot going on inside the organization. We continue to try and work out how best to communicate that with you guys, and how to keep you informed of the work that's going on inside the organization. We're not spruikers, you won't see us making outlandish comments or commitments or statements. What we tend, the approach we take on this, and will continue to take is talk to you guys honestly and pragmatically about the opportunities that we see, but also the risks and constraints that come with some of the technologies, particularly from a climate perspective. We'll be as open and transparent with you guys as we can be. It might not necessarily be as sexy or outlandish as some of the other statements you might see from other players in the market. It's our best guess based on a fairly significant commitment in resources and time and people, and expertise and experience on what we see the path forward from a sustainability and a climate perspective in particular is. Perhaps touching on New Zealand, that leads us to New Zealand. This is a fantastic announcement and opportunity for the New Zealand business. Very much underpinned by the enablers that we talked about when we put our climate action report out just a couple of years ago now. We've been able to make this step forward in New Zealand because the enablers that we've talked about to help with decarbonization in steel making are in place. New Zealand is blessed, of course, with enormous renewable resources and power. It's also firmed renewable power. That was certainly an opportunity for us. The market in New Zealand exports currently about 500,000 tons of scrap a year. We saw that as an opportunity. Two of the major enablers we've talked about in terms of our 2050 aspiration are firmed renewable, affordable energy. It's not the cheapest energy, I might say, but in relative terms in the market in New Zealand, it's an affordable energy. It's renewable, it's firmed. We have access to the required quantity and quality of scrap, we believe. That's afforded us the opportunity, given the modular nature of the steel-making process in New Zealand, the kilns and the melters, to look at taking 50% of our iron sands, coal, thermal coal, steel production out and replacing it with electric arc furnace scrap melt. We'll take out our KOBM or our steel-making facility, install an electric arc furnace, and mix our iron from iron sands production and the melted scrap, in the EAF to come up with the steel make requirements for the New Zealand market. Fabulous opportunity. We know how to run electric arc furnaces. You're gonna see three of them today. This is an expertise and capability we have inside the organization. We don't see that as a major risk. There's some technical and technology issues around the mixing of scrap and molten iron that we're working hard on and looking at other facilities in China. In Europe who are currently using this technology. So it's not bleeding-edge technology by any stretch of the imagination. But a significant reduction for the business in terms of the carbon that's emitted. About NZD 300 million, the New Zealand GIDI Fund, which is effectively the fund of ETS dollars they've been accumulating, investing in this to the tune of NZD 140 million. There's been some accusations in some of the press about corporate welfare or corporate benefits. This program's set up in New Zealand for exactly this purpose, to work with industry to decarbonize. We'll take 800,000 tons of carbon out of the process. As one of the ministers said yesterday, that's equivalent to 330,000 cars, which is all of the cars in Christchurch. To visualize it, they effectively said you wouldn't need a car in Christchurch. A significant reduction in emissions from the facility and a really important step for us, I think, in terms of our plans for 2030, our aspirations for 2050. A very important step for New Zealand, both our business and the country, but also a really important part of the BlueScope climate and sustainability story. Something we're very excited about. This is real. It's not a pilot plant. It's not a project. It's not an aspiration. It is subject to some final approvals and feasibility, but the team are working very hard on that, and we expect to be up and operating by 2026. A very exciting day on Sunday. The New Zealand government were very, very keen on this project because of the scale of it. There's nothing else in New Zealand of anything like this scale, so a fantastic opportunity for us. We have a diverse and high-quality suite of assets. An interesting geographical but also sector mix. As you guys know, largely building and construction. Now almost 50% of our earnings coming from the North American business, and that will grow on the investments that we've made. I think just as you spend the next few days in North America, something that continues to impress me and excite me about the North American market, the amount of investment that's occurring in this economy, the scale of this economy, the investment that's gonna come from the IRA, renewable energy, infrastructure spend, all of that, I think, is a positive from a steel industry perspective. The consolidation that we've seen in the market here and the more rational behavior that's occurring in the market and the forward-looking demand outlook, all of the renewable energy spend in North America is steel-intensive. Everyone I talk to and listen to talks about more steel going forward. Mike Henry quoted just last week in Barcelona a significant requirement for additional steelmaking going forward. We need to decarbonize, and we have a challenge in that space. I think the fundamental outlook or the base outlook for steel, particularly in North America, is very positive, and that gives us continued confidence to invest here. Look, we're well-positioned, we think, to take advantage of some of those longer-term trends, the underlying demand, some of the shifts in how people are living, regional living, et cetera. The steel intensity that comes with renewable energy investment, and of course the China continuing to manage its steel production levels. I will touch on, and you'll see later today and tomorrow in particular, some of the branding pieces and some very exciting work that we think will allow us to bring a packaged and branded offer as a painted solution into the North American market. Mark, did you wanna say anything from a financial perspective? Sure. Yep. Okay. Yeah. Just on the financial framework, so this is not news to me and the team here, and this is something we've had in place for quite some time and really guides how we wanna manage the business from a financial perspective, balance sheet perspective, and capital allocation perspective. There's really three pillars, and that's focusing on regenerating returns in excess of our cost of capital, so really focusing on cash flow generation. Really important, I guess, in a cyclical industry like we operate in. Really gives us then the flexibility to invest further in the business. Maintaining a robust capital structure, again, given the nature of the cyclical nature of the steel industry, something we focus very closely on. You would've seen we have a balance sheet target kind of mid to long term of AUD 400 million of net debt. You would've seen at December we're carrying a bit more capacity at the moment. That's quite deliberate given we are in the midst and entering a relatively heavy capital phase, including around the potential relining of Number Six. That's quite intentional. The idea is to maintain a strong balance sheet to help provide the flexibility to reinvest in the operations and continue to grow the business. The third element around a disciplined approach to capital allocation. Again, this is critical to how we think about balancing return to shareholders and further investment in the business. We'll continue to invest in safe and reliable operations and including around our decarbonization goals in New Zealand. You know, the New Zealand opportunity is a great example of that. Then really it's about what is that surplus capital that we generate, and where do we deploy that, both in terms of growing the business further and balancing that with shareholder returns? Obviously at the moment, we've, we're targeting the AUD 0.50 per share annual dividend. That's what we're trying to maintain, and we think we can maintain that through the cycle. The interim now, we're back in the taxpayer position in Australia. We're now franking that dividend, which is a bit of a mixed blessing obviously. Then really the balance is around topping that up with the buybacks. We're targeting a combination of the dividend and the buyback to return greater than 50% of our free cash flow back to shareholders. Really that is how we try to manage that balance between returns to shareholders and reinvesting in the business for growth. My hand back to you. Good. Yeah. Thank you. We pulled this together, I guess, very topical in terms of us being here, but we pulled this together just to give a bit of history of our involvement and commitment to the North American market. As you can see, we've been in the U.S. for quite some time, 1996, with the joint venture with Cargill, the business has continued to grow. That backdrop that I talked about earlier in terms of the positive demand outlook, given the investment profile of IRA renewable energy infrastructure, again, gives us confidence to continue to think about North America as a growth opportunity for BlueScope. It's a large business now, 26 sites, nearly $9 billion worth of revenue. As I said, 48% of our EBIT, so it's a large business and 3.3 million tons of steel make. Kristie and Pat, recently retired, had been focused not only on growing our business here in North America, but also building a capable and experienced team, and you will see most of the team over the next day or so. Conrad will talk to you shortly about North Star. After Kristie's introduction, Hector, who has worked at North Star for some time, is now running recycling for us. Sue, running the buildings business, you'll see tomorrow. John Kuzdal, who's joined us, John worked with us as part of the M&A team when we decided to pursue the coating assets, as it turned out. Turns out John had previously managed the coatings assets. He took a decision to step down when it was acquired by the private equity group that we then acquired the assets from. John was known to us. He'd worked with Pat Finan years ago at Steelscape. He's a very experienced industry executive, and we were delighted to not only use him as part of the M&A team, but to engage him as the General Manager, the CEO, President of that business post the acquisition. We've got now someone running that business who knows that business intimately as well, and Matt running our Properties Group. You'll see the management team that Kristie's putting together and has been building over the last year or so over the next day as they tell you the story. I'm gonna stop there and hand over to Kristie, and she'll give you an overview of BlueScope North America, and then we'll get into Conrad's session, and we'll get time for some Q&A. Again, welcome. It's lovely to have you guys here. Thank you. Thank you, Mark. Welcome. We're delighted to have you here, and I know the teams are really excited to host you over the next couple of days. It's a great opportunity for you to, you know, get out and visit the site and operations and see some of the products we make. As Mark said, I only recently started in this role in February behind Pat, but have been with BlueScope for 22 years. I joined as BlueScope publicly listed and have worked in different parts of the businesses, and in sort of corporate global roles with a more of a HSE people background. Delighted to be here and working off the back of the work that Pat had done with the acquisitions. It's all been really about bringing those newer businesses together, the more established businesses, building out a really highly talented, diverse team to really take us forward on our growth journey. As Mark showed you, we've got the overarching BlueScope transform, grow, deliver strategy, and the U.S. is really a critical part of that, particularly in the growth theme, and that's really reflective of the recent investments that we've made, obviously in the expansion of North Star, which you'll see today, and the newly acquired BlueScope Recycling and Materials business and the coated assets. We're also further enhancing that value by really leveraging the capabilities that BlueScope Recycling brings and working with North Star around their value-in-use model so that we can really optimize the raw material sourcing and usage mix. You'll hear Conrad and Hector actually talk to that in quite a lot of detail. That's a really important strategy in how we grow security of supply. In addition, obviously introducing the leading coated and painted assets and brands, and Mark's already alluded to introducing John, who you'll meet on Wednesday, and that's really how we introduce single-bill to transform the business model, where we see a demand growing with that offer, as well as introducing the branded products for differentiation. Really excited to share some of the progress that the team's making in that regard. Obviously, beyond that, continuing to look for further opportunities to grow and integrate. We see a number of key trends, and many of these you'll be familiar with through your own research and analysis, but real key trends that see the U.S. being a great place to make and sell steel. On the supply side, you know, industry consolidation and capacity rationalization, which is helping improve the industry structure, and Conrad's got a really good slide on that that you'll see shortly, combined with new EAF production, and the shift to that side of manufacturing or steel processing, which does put pressure on the type of raw material side of things, but rational behavior driving the supplier discipline with a U.S. domestic focus. On the demand side, lots of investment, and again, Mark's covered that through the Inflation Reduction Act and the other legislative pieces that are really driving a lot of investment, manufacturing, reshoring post-COVID, and then obviously the build-out of energy transition and e-commerce, which, as you can see there, we think that BlueScope's well positioned to take advantage of our asset base and our exposure to those trends. In terms of the end use segments, the key ones obviously here are automotive, construction, and manufacturing that are relevant to BlueScope. In the non-residential construction space, we have exposure across all of our U.S. businesses. We see recovery in the non-residential sector to continue, and that's through leveraging the support of the positive legislative policies. E-commerce demand continuing to drive warehousing, logistics, and data centers, which is good for our pre-engineered buildings and our BlueScope Properties Group. From an automotive sector, we expect to see recovery post-COVID and the semiconductor chip shortages. Despite stretched budgets, we're seeing still a solid backlog of demand and continued preference for SUVs and that shift to EVs remaining steel-intensive. North Star has an exposure, obviously, to the automotive industry through the components and frames and chassis that they produce. While we're small, we are the preferred supplier in the industry and have consistent full utilization. Direct exposure to manufacturing, which we see continued growth, then that sort of supports the growth in the indirect or the non-resi construction side as well. It really paints a picture that's favorable demand outlook for steel in the U.S. We expect stable flat steel growth driven by normal GDP growth, end-use segment demand dynamics, and the support of legislative initiatives that we've referred to. While the legislation's positive, we also acknowledge that, you know, it does have more of a direct impact on some of the long products such as rebar, structural, and wire, but it certainly does flow through and support the flat product side as well. In short, we see the U.S. to continue to need and modestly grow its steel demand, which is forecasted to grow by 1.3%. Following the recent acquisitions, as Mark said, we now have 26 sites, we feel we've got a fantastic footprint across the U.S. BlueScope Recycling and North Star are located in the key demand area for hot-rolled coil, with half U.S. steel consumed and a significant amount of scrap generated within a 300-mile radius from here. The West Coast exposure through Steelscape and ASC, and as you know, that's part of the Nippon Steel Corporation joint venture, so through the building segments area. Then we have now a national footprint for paintings and through our buildings business as well operating across the three time zones. Really enabling greater exposure to a wider customer base. This is just showing our footprint and how that presence across the value chain, each with their competitive advantages within that. I think really what we've been doing as a team is now laying that out and saying, "Well, now how do we capitalize on the synergies and the opportunities that now exist between those businesses where they do exist?" Really trying to leverage on our capabilities so that we can work together and achieve those incremental benefits. Then if we overlay that, the footprint, all of the key data and trends and demand, this has really helped inform our North American strategy. You'll see there's our vision, the enablers, then we really have three key strategic pillars, if you like. The first one on the left here is about securing North Star as a leading low-cost, sustainable steel producer. As we go through the business presentations, we're gonna do a deep dive into those strategic initiatives, so Conrad will be expanding on that component of the strategic plan. The second part is really building our national premium branded coated and painted product offering. Again, you'll hear more about single bill and what that actually means, moving from a toll processing to a single bill offer, as well as introducing a Colorbond product brand here in the U.S. So we'll expand further on that piece on Wednesday. Then the third pillar is about being a leading downstream player and exploring further growth options. Sue and her business are doing a whole lot of work on segmentation, and a whole lot on data insights in terms of, you know, new markets and where they're trying to optimize and play within their business. And also doing a whole lot of work around an accelerator at the moment, where we've invited some startups to help us think through the design of green buildings from a sustainability perspective. Some really exciting work happening in that part of the business. And it's really seeking, you know, how do we actually drive that transformation across the full business? Now we have this footprint. We've been doing work as well to enable our regional model. As we think about... As we've taken on the acquisitions, we've had to provide a lot of capabilities and shared services. We're taking all of the back end office pieces under a project called Pelican. It's really trying to optimize so we've got a strong foundation to support those businesses through finance transformation, HR transformation, and IT. As we grow, that enables us to be far more agile and nimble to be able to continue to serve and take on those businesses from a growth perspective. Lots of, lots of work happening in that regard as well, and an enormous amount of work just getting the voice of the customer into this from a customer experience perspective. You'll see a lot of the businesses have a dashboard of digital programs and automation programs. We will be looking at increasing or upgrading the customer portals and involving our customers with their insights so that we can help improve that experience and visibility of information and data. All of this really translates into our growth roadmap. Here we're just sort of showing the composition of the businesses by their streams and effectively what we're currently executing on. I kind of use a framework of mobilize, perform, and growth. We've really mobilized a lot of the new businesses, a lot of new capability that you'll see that's been curated and built into each of the business units, and then obviously building the North American leadership team across that. That's sort of the mobilize piece. It's really execution and excellence in execution and really making sure that our newly acquired businesses are performing and delivering, and then obviously the growth engine and some of the initiatives that those businesses, as well as executing on, are actually continuing to focus on. You'll hear Hector talk about the work that he has underway to grow out that recycling capacity and the sophistication around the actual processing and the reclamation of obsolete scrap and how then that fits into the supply into North Star and the hope to grow that. That's in that first box. We're also considering further value chain integration opportunities. We're really in the early stages of reviewing potential cold rolling and metallic coating capacity in around North Star as well. That's sort of what we're focused on going forward. Plenty of opportunities, largest geography and market, and a lot of really wonderful work happening in each of the businesses. In summary, there is a lot of work in play. I think we're really focused on digital and automation. We feel that making investments in that is really critical to being, you know, helping with operational efficiency and reliability, and the customer, and importantly, the employee experience. We've also been doing a lot of work on maintaining our core focus on health, safety, and environment. You'll see with the acquisitions, they've been investing a lot to help drive safety improvements and drive the BlueScope safety culture so that we can bring them into the BlueScope foundations and our values. We're really harnessing the strength of the organization culture. We have fantastic diversity in the businesses. You'll see a lot of women within the operations context. We will continue to keep growing our diversity, equity, and inclusion focus. On a sustainability front, I have Gretta Stephens and her team coming here in July, August to work with the team. We think we have a very good story to tell. I mean, North Star has a very good low carbon footprint. We have the recycling business. In Sue's business, we're looking at energy, embodied energy within buildings. It's about how do we fill out and how do we build out our sustainability story and our sustainability strategy that underpins our overarching strategic themes. As I said, we're also, you know, focusing on the customer and really partnering with the communities in which we operate. Here at North Star, looking at Kristen out the back there, but an enormous amount of really sort of heartfelt activities within the community, and that's really important to us wherever we operate across our business. At a high level, that was really just to set context so that you can start to get into the business presentations. I think you're gonna really enjoy learning, you know, provided an overview with each business unit, but then what sort of their key focus areas are. With that said, I'm delighted to hand to Conrad. Conrad Winkler joined us in the last 12 months, and I'll hand to you to do your own personal introduction. Yeah, we'll hand over and get stuck into the North Star presentation. Thank you. Thanks, Kristie. We've got that. All right. Yep, that should click the right box. All right. Got it. Yeah. I'm Conrad Winkler. Really happy to be here. I'm thrilled to be a part of North Star BlueScope. North Star, you know, has a reputation as being the best steelmaker in the industry. That's what I've heard for many years in the steel industry. When I had a chance to come here, I was thrilled and still am. What I didn't realize, I did know that the culture here was something really special, and I knew that this was a business that kept utilized when others were not. I knew that the customers loved the place. You know, what I didn't fully really appreciate is just how great this formation of this North America leadership team with Kristie and with John Kuzdal and with Sue Stark and others you're gonna meet along the way, and with Hector, just what a pleasure that group is to work with. This is a really strong, capable team, that can do some great things. Really, I think that, hopefully the discussion of North Star will be great, but also I'm sure that the other pieces will really pull it all together for you as to what BlueScope's doing here. Hey, I came here from EVRAZ North America, so I ran another steel business for a number of years, and that's given me a chance to really contrast the experience I'm having here with that and hopefully give you a sense of why we're different and better than other steel producers. A few things. First of all, let's see. You know, when I came here, I, first thing I did was spend time with the operations team, start to learn the people here. The next thing I did is I went out and talked to customers. I can tell you what a contrast, thinking of contrasts. I'm showing up at customers and asking them, "Hey, what are the issues that we need to fix? What can we do better? How can we serve you better?" Customers' reaction is, well, first of all, and it's consistent. 100% customers said this, "You guys are doing great. We love the quality of your steel, and we love your on-time delivery, and don't screw it up." You know, I mean, that was the sort of message that we got. What a contrast from, "Hey, let me tell you about this quality problem or this delivery miss." None of that. Our efforts with our customers really become forward-looking. You know, what's the next thing we can do for you? Next, you know, I just was gonna talk briefly about about the culture. You know, when Jeff has his ops meeting every day, the first thing we do is we talk about safety. You know, a typical day. Yesterday, I said it in the meeting, I skipped today so that I could be here. Someone was walking along, and their shirt got caught on an anchor bolt as they were walking by. It just got caught, ripped his shirt a little bit. So what happened? You know. Well, you know, typical place, you might say someone detaches their shirt and keeps walking along, right? That would be one option. Another would be detaches their shirt and then calls some supervisor and says, "Hey, there's something sticking out here," which never makes it on anyone's priority list, so the problem never gets actually resolved. A third would be, you know, calling a maintenance person and saying, "Come fix it." Another might be, "Hey, I'm gonna go ask my supervisor if I can have a little bit of time to go work on this." None of that happens here. Person just went out, ground down the anchor bolt after making sure it didn't have any other use, and life goes on. Same with, there was a hydraulic leak in the hot strip mill, a minor hydraulic leak, and same thing. You know, someone went out, saw that there was a little bit of oil leaking, fixed the leak, you know, checked first, did the proper lockouts to make that happen. What didn't happen? There was no discussion from that team member about, "Oh, I have to ask the team leader for permission for it. Oh, I need to spend an hour to go get my parts for it. Oh, I need to get..." You know, just gets on the radio and grabs a couple of people who, he or she knows well, gets the problem resolved. That's how we operate. That's why, you know, when you look at this operation and when you walk around and you see that we've got, you know, roughly just a little over 500 people, intending to make 3 million tons of steel a year, just why does that work so well, and what are some elements of that culture that are so special? Next, just the ramp up. With that culture in mind, and with the great work really that the team did, including Pat Finan and a bunch of really capable project managers from Australia, plus the operations team here, all working together. For those of you who are tracking the steel industry in the United States closely, you know, I could ask how many have seen a project like this go through the middle of a pandemic with a ramp-up plan that is on schedule. Instead of being at $700 million like originally planned, we're coming in at $735 million. You can compare and contrast that with any project in the steel industry, and I've never seen anything like it. That's the kinda capability this team has. We're really excited to show off the expansion. Hopefully, it's as thrilling to you as it is to me every time we walk out there. With that, we're also happy to be a significant financial contributor. Getting back to all that discussion of the customer, you know, people say, "Well, why is it that you're operating almost consistently at 100% utilization and the rest of the industry doesn't?" It just comes back to our customers. It's that relationship we have with them, and the way we work with them, and quite frankly, the way they work with us as well. Talking a little bit about our strategy, you know, Kristie showed this slide, and I'll just ours in particular. You know, first of all, you know, we're very focused on maximizing our capacity and then taking that next step after this to expand beyond. You know, right now we're shooting for this 850,000 metric ton addition of volume, which is going extremely well. That's a major focus of ours. Then next after that, our next area will be debottlenecking the place and taking it one step farther, which we're just as excited about as we are. Already a lot of our attention is starting to shift towards, okay, how do we take the next step? Next, it's really about raw material. You know, Our biggest cost by far is scrap and pig iron. Our focus right now in those next couple of bullets is how do we get the most out of the scrap pig iron-ore based metallics that are out there. What we've really done now is taken this to a different level with the acquisitions of MetalX and Mill I ron that with the business that Hector leads around recycling and working together between BRM and North Star to create competitive advantage and lower our cost. That ability transcends what happens with all the different raw material inputs, because our ability says if one is costing more or one is less than on a yielded basis, our goal is to be able to build that cheapest mix. Next, it's really about preserving the performance-oriented culture. You know, for better or worse, you know, our team members here really act like they own the place. You know, how hard do you have to work to get to the point where people care so deeply about the place that they act like they're owners? When they start seeing, I mean, us adding headcount, for example, even in IT or something like that, our team members, they say things like, "Hey, I heard we added another IT person. Are we sure that's a good idea, given the cost impact of that?" I mean, that's the kind of culture and attitude. People act like they own the place, and we really want that. Sometimes, you know, you wonder, you know, "Hey, why is someone talking to me about IT who's working on caster operations?" Because they really care about this business, and they wanna make sure that it continues to be as low cost and as effective as it has been. You know, we're working to transform our business through our work on our raw materials and digital. We wanna deliver the growth that's planned and then deliver that next step of growth after that and deliver that connectivity with the coated products business that we're all hoping comes about. Then the other part of it is really continuing the culture and continuing to have everyone here feel like they own the place. Even though we've added 100 new, more than 100 new faces here, we want them to have that same kind of culture. I just add to it, you know, we're really working on evolving our safety program. With our culture, we've got the ability to do things that, you know, not every company can do. That is, this is BlueScope wide in terms of safety, is that the safety culture's, it's there, you know, throughout the business. All the basics of safety. Our focus on safety isn't how do we enforce rules. Our focus on safety is how do we take it to the next level. How do we get our team members thinking about the things that are out there that are potentially the most dangerous and us fixing those long before there's ever an injury or a risk of injury. Much less reactive, much more forward-thinking. Ashley, many of you met last night, and she'll be here this afternoon and tonight, so she would do this, and I'll do my best to cover for her. As Mark quoted her last night, she said that coming to North Star is like dying and going to steel heaven. It is really a terrific experience with our customer visits. Just to talk about that a little bit more, you know, within Jacobsen's, which is kind of the main survey in the steel industry, we've been at the top of that for 10-15 years. Plan on keeping it that way. I thought I'd give another example or two of why the customers seem to value us so much and why we're so focused on our customers. You know, it's not just that our on-time delivery is better and that our quality is better. It actually translates into real economics for our customers. What our customers tell me is things like, "We've measured it, and the yield that we get in our manufacturing process is better with your steel than it is with your competitors'. Your on-time delivery enables us to reduce our total inventory picture because we know that when we're ordering from you, we don't have to have three different backup, you know, we don't need to have tons of backup coils. We know we're gonna get it from you on time, and that pulls their inventory down. It's really valued by them. Also, as I mentioned, we also look forward. If you think about the, you know, Kristie was talking about our customer-facing portal and some of the things. We've got, obviously, like everyone, we've got work to do to improve it. At the same time, you know, what our customers say is when I ask them, "Hey, how can we make it better?" They say, "Look, Conrad, I take screenshots of your portal, and I send it to your competitors and ask them why they can't do it." The reason our portal is good is because we really listen and work with those customers. We built a portal that's very simple, that gives the customers all the things they need. We took it one step farther, and we built an unattended kiosk out here, where truck drivers can come in, basically, scan their QR code and go pick up a coil and leave. If you think about if we're doing, say, 10, 12,000 tons a day, what is that? That's 250-300 trucks a day coming in and out of here. You may have noticed when you walked in the long lineup of trucks, you didn't because there's never a lineup of trucks because each truck can schedule their exact pickup time. They come in, and we're turning them around generally within 20 minutes, which is, in the steel industry, outrageous, really. I mean, it's really fast. They come in, the coil gets loaded on their truck, they strap it down, and they're out. That gives you kind of an idea of why our customer is important and why they value it. Next I thought why don't I talk about the economics in our local customer base. You know, this is a huge number, a huge amount of our volume that's delivered right next door. I mean, it's a quick trip. If you think about that from a truck or shipping standpoint, we have a set of relationships with. We use a lot of different shippers, truck drivers, but there are about five different companies we use. They're able to make multiple trips a day with our coils because we get them in and out fast. That customer base is basically within 300 miles. That's a huge competitive advantage. Not only that, as Hector's gonna tell you, most of our scrap's nearby too. The total economic picture is a good one. You know, what does all this mean? You know, we've got some differentiated capabilities. We have some differentiated economics. We're really excited about what we can do going forward. That's why we're gonna stay highly utilized. I was trying to think of how to describe some of this, and I decided, I think it's basically a good business. You know. Look, it's got a positive trajectory, and there's a lot of room for the low-cost producers within the business. First of all, on the left, you can see, you know, industry consolidation, it helps. You know, it helps a lot. The other piece of it, though, is that within the production mix, everyone's heard there's this shift from from EAF to blast furnace. If you look at that shift and that 54 million ton production, you know, there's still a lot of room there. As a lower-cost producer or sometimes the low-cost producer, we like to think, there's a lot of room still for growth of those who have the better assets, the assets that renew year after year, that are extremely well-run, where we can deliver, you know, to customers that are nearby, who we respect and who respect us. So again, it's a good business with a positive trajectory and a lot of room for growth. Yeah, the other thing that I would point out before is just, and some here have heard me say this, so apologize for the repetition, but steel tourism does not work, I mean, basically. That's where this whole concept. When we think of competition, we think of it in a very regional way. With that in mind, our team did a nice job putting together what that supply-demand balance and outlook looks like. It's, as I said, it's not just the fact that there's a cost associated with different with being close, but it's also just the way that our customers can operate in terms of their overhead structure, their inventory. For many of our customers, actually, a significant percentage of our steel, they pick up themselves. They've got their own local trucking, and they wanna make those runs themselves. That's an advantage that if they decide that they wanna buy steel from the Southeastern United States, how does that actually work? Well, now we're in a totally different cost structure for those customers. We think of it as a local region when we think of our competition. Not that it doesn't matter that there's new electric arc furnaces going in and new competitors, of course. You know, we're impacted by that, and we're paying close attention to it. At the same time, you know, our business is local. I wanted to kick it over, Jeff, actually. You're up next. Jeff's gonna tell us a little bit about this expansion progress. I know based on dinner last night, there was a lot of questions about how it's going, and Jeff's gonna answer some of those, and probably not all of those questions, though. Over to you, Jeff. Again, I met some of you last night. I'm Jeff Joldrichsen, Vice President of Operations. I've been with North Star for over 27 years, I got a lot of experience with this mill and this industry. I got blessed or whatever you wanna call it. I got to commission the original, I get to do it again. I guess I'm a little glutton for punishment. Ramp-up wise, a good analogy is, it's going as we expected. You know, you think about what we had to do. We built this plant while we were operating the Brownfield at full utilization. We had COVID. We have 100 new employees that never saw a steel mill before, we haven't missed a beat. How is that? That's a credit to my team. You know, we have a very good core group of people that do very great things every day, and you'll get to see them here in a little bit. By doing that, we are able to build this ramp up. At the same point, Conrad mentioned, you know, this is about making sure our customers are happy. You know, it's not just making steel and going, "Oh, we're making a bunch of garbage. We can't... You know, customers don't like it." It's making sure the customer liked our new product coming off a new line and verifying all that. That all has worked as we expected. Real credit to the team building, the design, the commissioning, you know, now we're ramping up. So we did add a third EAF, you know, two more ladle furnaces, a second caster, a new tunnel furnace, and a shuttle furnace. You'll see all that today. We started really in a ramp-up in August, and, you know, we're seeing some very positive benefits, and we're having our, you know, teething pains that we're working through as well. But we're having a lot more positives than I'd say the other way, which is really good. And you see the numbers there. We are just... You know, every day, we're finding something new. We're finding a new challenge, and we're addressing it and fixing it and making it better. And we're seeing some big numbers come out of this facility. For me, I just see a real positive for the future. So debottlenecking project. I have to give myself a little bit of credit here. This slide was done in 2018 before we put any shovel in the ground, and I haven't changed, I think, a couple things, and that's it. I said, "Well, I must know a little bit about doing this process." What do we have to do? We are working on that now. You will see some things today that are part of the debottlenecking project that we're already addressing. Every day, we're going, "Okay, we could have did this better or faster. What do we gotta add?" We're already in that process. When you look at some of those issues, again, ladle aisle flows, it's about getting ladles turned quicker, the LMF treatments faster, how we keep our slab temperatures better for our, for our hot mill, how we transfer the bar. There are some hot mill upgrades we're looking at, you know, and as well as the downcoiler. All the stuff that we thought were an issue, and I don't wanna say issue as in bad, but an opportunity for us to make better, is still going on. We're, we're doing that today, and we'll continue to do that here in the next several years because we see the upside, which will, you know, obviously make North Star a huge producer of steel in the, in the Midwest. I think that's. I just look forward to taking y'all. I can do a lot better when I take out and show you all this than tell you. That's just little boxes. Yeah. Yeah. We're, you know, we're fortunate to have Jeff here, and we're also, as Jeff mentioned, you know, in addition to the culture, the capabilities here are pretty different too. If I could just mention within that ops maintenance engineering team, I would say just even though our total headcount is extremely low here, we have capabilities within that headcount that I haven't seen in other steel. I would estimate, compared to other steel mills, that we probably have 3x or 4 x the number of high-quality controls engineers, for example, than a typical steel plant. It means that the things that Jeff's talking about, the improvements that we run into every day, whereas for some folks who don't have that kind of capability, for every issue they have, they're calling up the suppliers to come help them. For us, as we run into those issues, they're addressing them real time. I mean, there's so many examples of it. You'll see these, the shuttle furnace going back and forth, and one idea that the team had was, well, what if when we're only running single cast, we've got all this extra shuttle furnace space, maybe we could back some slabs up into the shuttle furnace and hold them there if we have a problem for a few minutes to change out a roll in the hot strip mill. You know, I thought, "Oh, that's a really cool idea." I went out there, and it was done. I mean, they were actively moving. I'm like, "How did you get that done so fast?" These control engineers are... You know, they're that capable. The maintenance team, you know, why is it that the quality is good? It's not, it's not because of good attitude alone. It's because we really keep the equipment running extremely well all the time. I mean, that's the focus of the team. Thanks, Jeff, and thanks to the whole team here. Applying some of those same principles to raw material. First of all, on scrap, you know, our focus right now is Hector's gonna get into this. You know, the acquisition of MetalX, these are really differentiated scrap businesses that we've got with the special capabilities already to basically be able to replace a lot of our prime scrap with obsolete scrap. That's a huge portion of our focus, but it's not just that. It's optimizing day to day, month to month based on what's happening in the market in terms of price. If prime scrap goes way up in price, we can react to that by increasing obsolete and other ore-based metallics to make up for that mix. We do that, we'll talk a little bit with an AI-based approach that enables that. From a pig iron standpoint, we've really diversified our supply base with some of the changes that have gone on there, so that we have a secure supply, but also we've reduced our requirement for pig iron. That gives us a lot of flexibility. In terms of DRI and HBI, we currently get DRI and HBI into the system, and we're looking at how to increase that volume that we're getting and what are the options, for us to get, DRI, HBI, more of it into our system to give us more flexibility to save more money. Just as a case study, we've launched this project, we call value-in-use. Essentially what we've got now with the fact that we can work so closely between BRM, the recycling business, and the steel business, we've basically got three models operating at once. One is actually the AI-based piece is within the steel mill, actually choosing what goes into the bucket based on optimizing cost and optimizing the residuals. The second piece of it is how the recycling business and the steel business work together to coordinate the buy. The third piece is really focused on the recycling business. All three of these being able to pull off the same dataset in order to really optimize what that buy is, so that we can, you know, get every bit of cost out that is possible while still maintaining outstanding quality. When we did that, we used our some subject matter experts, but also we've got a great digital team from Australia that came in and helped us develop some of those models. Now we're actually, you know, hiring some of those capabilities here in the U.S. to directly support us as well, as the list of projects that we've got a backlog on has grown and grown. Just in terms of, you know, how to think about, as one models the business, how to think a little bit about our formula for spread. We just thought we'd update you with how we're thinking of spread now and how it's changed. You'll see on the hot-rolled coil pricing that we're now saying that, you know, we're assigning 75% of it on a one-month lag, to CRU with a one-month lag. 25% of it is other types of contracts, you know, whether it's fixed price or longer lags or things like that. On the raw material side, the change that you'd see here is that we've shifted to a leaner pig mix. We're using less pig iron now, we wanted to reflect that in our spread modeling. I was gonna kick it over to Kristie Keast to talk a little bit about what we're doing from a community safety HR. She leads our HR, she leads our safety, she leads environment. She's been with us... She also comes from another steel company, but about five years, five years ago, and you know, brings a lot of power to a lot of the things we're working on. I was just gonna touch on one before I handed it off to her. If you look at our greenhouse gas footprint, and Kristen, in addition to being safety and HR, is an environmental engineer by education as well. We already, obviously, as an electric arc furnace, we have a very low greenhouse gas footprint. I think we're something like, you know, around 0.5, a little bit below that, which is similar to other electric arc furnaces. We're also supplied within our area here largely with nuclear power. We have the credits associated with that nuclear power. If you think of our greenhouse gas footprint, you can kind of divide by two, and that's the kind of range compared to other EAFs, that's where we sit. Right now, one of the things that we're working hard on is we've got some customers who would like a carbon neutral steel product, and we can provide that to them, and we can do so in a cost-advantaged way, which we're very excited about. Now, over to Kristen. Thanks. Good morning, everyone. I'm Kristen, as Conrad mentioned. We just wanted to highlight a few of our Health Safety Environment initiatives. I think if we just go back to, you know, kind of looking at our purpose and our bond, and talking about even the example that Conrad mentioned, our people are our strength. I think the way that we approach the Health and Safety, really core of our jobs and of our day-to-day focus here, it's really on that personal ownership, you know, around safety. I think the example Conrad gave is quite, it's one of many, right, that we hear every day. I like to use the term, you know, if you see something, say something, but then you do something about it. At my previous job, we kinda used that as, like a slogan. It got printed on a T-shirt even. Here, when I came here, like, it doesn't have to get printed on a T-shirt here. It is just ingrained in the way and in the culture, and our newer team members quickly kind of feel that, right? It's not that you just tell someone else about the safety concern. You actually own it, right? I think the two examples here, where we're talking about these critical risk projects. The picture of the caster turret. You know, we have this job that the team has to get down inside that caster turret, either on a down day or an outage, and they literally have to climb down multiple ladders, you know, carry tools. We have... Right, we introduced these critical risk projects, and this was one where we had an amazing group of engineers that looked at that and said, "There has to be a better way." Right? They literally took. You know, the original design, right, that was a solid shell at the bottom. There was no access door in and out, and they redesigned the current, you know, turret on caster one. Not only that, but we were able to build that into how we did caster two. That egress door in and out, I mean, it's so much better. There's a way to be able to move tools in and out, obviously, just the ergonomics, and the way that we've just made the job easier. Some of those things, like, you look at it and you think, "It seems that simple." Right? It's the way the equipment was designed. We're asking our team, and they're coming up with those solutions. When we talk about that empowered and engaged team, that's really, like, a prime example of how that links to our health and safety projects. The other one there you'll see on the tour as well, there's a handrail on top of the heated transfer table. Again, you know, anytime we're working at heights, we have a 100% tie-off requirement, and so the way that if our team members had to go up and do the job, they would have to use a lanyard and tie off, and it was very cumbersome. We had another group of engineers look at that and just say, "There has to be a better way." Really, It's improved efficiency, right? It makes that job easier. It's just a couple examples that we wanted to share, showing some of the great teamwork and how that's tied to the health and safety improvements. Then I just wanted to touch on one piece under the sustainability. Conrad already mentioned the carbon neutral product offering, but the other piece I just wanted to highlight is our water stewardship. We are honored to be in a very great region of the country here, where we have the 5 Great Lakes. It is a very, right, freshwater abundant area, but that doesn't mean that we wanna be wasteful, right? This is a very water-intensive process. We're proud to say, through Project Aristotle, we utilize some technology. It's called ultrafiltration and reverse osmosis, and we actually are discharging and using less water now than we were before the project. The amount of gallons per ton, or per coil ton, has actually decreased. We have a goal that we actually want to get to, a zero liquid discharge, which means we would be, right, continually recycling and repurposing the water. With this technology, and again, the teams that are behind that, we think we'll be able to do that. Thanks. Awesome, Kristen. Yeah, we're down to kind of a trickle of water that's discharged. What Kristen didn't mention about that is that we buy our water, and that project paid for itself in, I don't know, Jeff, how many months? It was- Seventeen. 17 months to pay for itself for us to get to near zero discharge of water. Pretty good, you know. Most of our projects around these are not only great for us to do based on our purpose and our bond, but they also have a good payback in general. Okay. Mark, I was gonna, in terms of I think next we were going over to, Q&A, I think. Hi, this Chen from Bank of America. Just a question on... Well, two questions, please. Just a question on your incremental volume from North Star. In the presentation mentioned, we'll, you know, go to your current customers, which are service centers. Could you please elaborate the opportunity for that incremental volume and the coated business and, you know, any plan rather than deliver to your service center, you know, and you can have that coated and more value added to improve the margin? Thank you. Yeah. Let me start with the ability to expand within our current customer base to, you know, the 850,000 metric ton expansion that we're undergoing right now. You know, what we expected when we started and what we're finding is that that's largely through our current customer base and through our current region. Now we've done some things to expand some of our customer-facing activities in order to get to some customers, largely, again, in the region that we hadn't been covering. If you look at the total opportunity, even though we have great relationships with our customers, there's still a very significant share of wallet that we're not covering within our customers within the region for those service centers. What we're finding so far and what we expect... What we expected and what we're seeing is that we're staying largely with our same customer base and largely within our same region, to absorb that additional part of the capacity. In terms of the actual question of how much coated product volume do we expect, maybe I could turn that over to Mark. Yeah. Chen, the way we're thinking about potentially cold rolling and metal coating is this would be an add to that existing capability that we have within our current customer base. The model we're now thinking about is, does installing a cold rolling facility and a metal coating line that then feeds the pipe lines, one of which you'll see tomorrow, it's about 100 miles from here or so, you'll see that tomorrow. Does that create value for us as well? We're actually now thinking about it in terms of that additional add-in. Do we take some of the additional steel making capacity from North Star, run it through our own cold roll mill that would be nearby this facility, put it through a metal coating line, and then supply it to our paint lines and potentially to other customers as well. That's the piece of work that's going on around that expansion project right now. Right. Thanks. Just a follow-up on that. At the moment for your coating, you are coating other steelmakers' steel, right? Then sell to the third party rather than coating your own- That's right. Your own That's the toll processing. Yeah. Yeah. Effectively, the customer delivers their coil, they specify the paint and the paint color, we paint it, and then it sort of then gets shipped out to their delivery point. Yeah. It's fascinating. To you, tomorrow, you'll go into the warehouse. We don't have a coil of our own material. No. I would say there's not a coil of our own material in the warehouse. It's all customer-owned material. This is the single-bill model that Kristie's talking about. The market here has developed largely around a toll processing model, which is very different to what we offer in Australia and other parts of our portfolio, where you buy a sheet of Colorbond as a finished product. We control the paint technology. Mm-hmm. We own the paint technology. We work with the paint suppliers as a provider of paint. In the market here in North America, someone goes and buys some steel from someone. You'll see all of them tomorrow. They go to a paint supplier and buy the paint, and they come to coaters, and we put it together for them. This is where we think there's a market opportunity for us to bring a packaged offer and ultimately a branded packaged offer to the market. Yes. Thanks. Maybe, a second question for the raw material. You mentioned 40%. Why it's 40%? Can you go 70% or 80%? Yeah, we can. I think the answer to that, Jen, is we've said 40%. I know Hector got this question from a few of you last night. That's not a, excuse the pun, cast iron commitment by any stretch of the imagination. We think that's a number that we're going to achieve given the assets that we currently have. One thing we don't wanna do is change the cost structure that's so important for this business. In a drive to 100% coverage, we would need to source scrap from further afield, and that would change the cost position on that. We still buy scrap from OmniSource that's owned by Steel Dynamics, buy scrap from DJ Joseph that's owned by Nucor, buy scrap from Ferrous Processing that's owned by Cliffs. Part of this is the benefits that you just saw articulated around value-in-use, taking advantage of our ownership of scrap, but maintaining that cost position and not forcing ourselves into the position where we're paying too much for our scrap. Thank you. Hi. Callie from JP Morgan. What are the biggest risks to the expansion and debottlenecking at North Star? Let's see. In the, you know, like, let me talk a little bit about the current expansion and, you know, first of all, in terms of equipment performance side of it, Jeff can correct me if I'm wrong, we really don't see a huge amount of risk left on the equipment performance. We've been able to perform essentially a pace and can do so. When you think about this type of expansion, though, it's, there's a lot of day-to-day things that we're working on all the time and just continuing to upgrade as we run into issues and push the volume higher every day. We don't see technical limitations in our equipment or in our operating capability that would prevent us. You know, I think that for us, it's really more for this current expansion. It's just us learning, continuing to learn and train and make minor adjustments. Very strong. There's the, you know, obviously new equipment, new different types of equipment. You know, you'll see, you know, going dual cast versus single cast. There's, you know, scheduling and other things that we just have to learn how to do that kind of thing. Those are our biggest risks. Quite frankly, I think that the big risks are well behind us right now in the current expansion. On the next level expansion in terms of going from there, we've got more, I think we've just got more work to do on that before we say we know what that is. At the same time, you know, Jeff, myself, engineers, you know, we're pretty deep into it. I think if we, if we know a little bit more, and have a little more operating experience, we'll probably be more intelligent about what we think the risks are there. Megan from Barrenjoey. Just on the raw material strategy, I'm just keen to understand, I guess, how you're seeing the benefit at the moment from the metal recycling businesses. I guess just, you know, whether or not you're seeing that as a positive difference today versus just buying prime scrap under the previous strategy. Whether or not, I guess, is that something that's sort of already in the numbers and we've seen the benefit, or will that continue to ramp up over time? Yeah. First of all, describing what that looks like for us in real terms. Right now, for example, we're able to. One of the big issues is the residuals within the scrap. Obsolete scrap, you know, you're gonna see the shredding of automobiles and the removal of the copper and the aluminum and our ability to turn that into a positive non-ferrous, a cash flow stream is really outstanding. At the same time, not only does that create a revenue stream for us, but it also means that the residual levels are more similar to prime scrap. Yet the price differential typically in the industry ranges somewhere between typically $50-$200 a ton kind of differential between prime and obsolete scrap. We can take advantage of that differential. I think right now the difference is about $40 or $50, a ton difference on a yielded basis that we can take advantage of by using more obsolete scrap that has those residuals removed than prime. We don't have a limitless capacity of that, and that's getting back to the 40%. I mean, that's part of what Hector's going to take you through in the next couple of days because we might actually, you know, take other people's scrap that they've already shredded and get some of that benefit ourselves. In terms of how much has been built into future forecasts and the like, I'll kick that over to Mark Scicluna. I mean, the way to think about it, the actual investments we made in those three sites, we expect to earn a return on capital on those investments just through the profits they generate in their own right. Right? We're still targeting... It's an internal sale, but they're still managed as a, I guess, a standalone profitable entity. That will be generated, and that will kind of oscillate through the cycle, through the scrap cycle. The last six months in the scrap game has been a little tough, given the downward price cycles. That's been a little softer. I don't think the full benefit of that standalone return on capital, you're necessarily seeing in the numbers just yet. In addition to that's really what Conrad was speaking to about really the synergies between the two businesses and optimizing the mix, which is really the second leg. That will take some time to deliver. I guess it's a, a long way of saying the full benefit from those acquisitions is not really in the numbers just yet. Yeah. Hi. Excuse me, Paul McTaggart from Citi. Building Products Group. This is a Schmick manufacturing business, and I've been around the steel industry a long time, but I really struggle to see how the Building Products Group kinda fits into this model. Properties. Yeah, properties, sorry. Building properties. What you're ultimately trying to achieve out of that? I mean, is it about trying to create a market and establish a market? I mean, it's an odd one for me. Yeah. Well, let me maybe give a little bit of background. I mean, this started four or five years ago now, where through our builder network, we have opportunities that were being brought to us that our builders, quite frankly, didn't have the balance sheet or the capability to deal with. It's all warehouse construction, Paul. It's very tightly managed from a risk perspective. We categorize it, and Matt'll talk about this in the next couple of days. There's build to demand or build to suit, so a couple of categories that we think about. Really what it is it's an adjacency that's come with the builder network that we have. What we're trying to achieve is a consistent level of earnings in that space. The $300 million that we've so far allocated to it, about half of that has been expended. We're expecting. We use 15% as our measure. Quite frankly, in that business unit, it should be more than a 15% return on funds. At the moment, rather than having the odd project, which you guys give zero value to because it's in one half and not the next, we actually wanna build a pipeline of work where we get a 15% or 20% return on that invested capital through the adjacency that we get of the builder network. It's a straight adjacency to that, the BBNA business that we have. That's the objective. I don't think. We've never tried to tie it to North Star, so they're totally different. Part of the, part of the work that Kristie's got on her plate now is what have been three unique standalone businesses, we're now rolling up as part of a North American group and trying to understand what the synergies are across the business. We don't have to have a model in North America that's like Australia or New Zealand, where we're fully vertically integrated. One of the fabulous things about this market is the optionality that we have to get raw material from other producers, have joint ventures, supplier relationships, alliances, et cetera. It doesn't have to be that fully vertically integrated model that you see in Australia or we have in China, where the steel's coming out of the coating plant, going into Butler through Lysaght's and completely aligned. I don't think we're constrained by that here in North America. I think that's one of the exciting opportunities of this market. It's Paul Young from Goldman Sachs. Question on the steel market. Found it really interesting, one of the slides you put up, which showed that you think that the flat product market or HRC market will be, you know, roughly in an SD balance by 2025. I think it was based on a sort of - 1% demand growth. Just curious about, you know, based on that analysis, you know, really the steel price should sort of track down to marginal cost. Where do you think that, you know, the industry's marginal cost would be around 2025? You know, obviously assume is based on what you think the scrap price will be, but, and energy prices, but just, you know, curious about your view there. I mean, I'll take a. I think that, you know, what we're getting at the heart of it is, you know, the really the spreads and whether the cost structure within those spreads have changed in the industry or whether that we see a significant change in that marginal cost. I mean, I think. First of all, that slide we put up was a regional look. It was very local in nature, so it wasn't the total United States or North America picture. It was, you know, really focused, and we showed that supply and demand was on balance based on that 1%. 1% growth rate and some of the new capacity coming on, and also the expectation that some of the capacity comes offline. Of course, some of that new capacity is ours. Within the way we think about the spreads, you know, kinda going to that other slide in terms of the consolidations, there's essentially, you know, I think our expectations have spread. I think over the last decade or so, spreads have averaged something around $300 per ton. For us, if you think about the cost structure of our competitors versus ours, you know, that's a very healthy spread for us. Obviously, we take advantage of the times in which the spreads are significantly more than that. We see spreads, you know, averaging that or more over time, you know, given the overall consolidation of the industry and the supply and demand balance. That's helpful. Thanks. Second question on your 25% of your sales are fixed price. How do we think about those fixed prices from a perspective of do they reset each year? Are they linked to CPI? When were they set? When do they roll off? Any, any color around that, you know? We didn't say 25% were fixed price. What we said was there's 25% of the book that is other than a 1-month lag. Some of that might be fixed price, but some of it might be quarterly pricing or 6-monthly pricing. As you would expect in a business like this, you just don't have it all on spot. Even within our 75% spot, it's not. I forget the term, Conrad, but it's not like we're swinging in the breeze for spot month in and month out. There's relationships with customers that we sell to every month that take material from us at a spot price. In a business like this, you can't have 100% of one model. All we're really doing is updating their, and we know, and I'm not the person to be qualified for this conversation. We have, with some of you, quite detailed conversations about lags and spreads. What we're really doing in that slide was just updating some of the more current information, given the expansion tons and the mix change, particularly with the lower usage of pig, to allow you guys to put that into your models. We're not saying there's 25% of the book is fixed price. 25% of the sales are in that other segment, and some of that may well be fixed. Yeah. Okay. No, that's helpful. I understand. The last question for me, just on the expansion or debottlenecking project to 3.4 mark. Still confused about, you know, when, you know, I guess target FID is. Is there an FID? Do you just start and sort of implement it and creep and spend that $100 million over time and get to 3.4? Yeah. It's not a, it's not a one project FID, as Jeff explained on his very forward-thinking slide from 2018. We'll need a new downcoiler. When we schedule that in, that'd be around a shut because we've got to cut into the existing mill that you'll see when you walk out there today. You got to get the equipment. I mean, some of it's ancillary services. We need more capacity in the grinding shop. We grind our own rolls. At the sort of volumes that he's now producing, we can't grind enough rolls, so we need another crane and more grinding capability. This will be incremental spend over the next, I think, Jeff, you said two or three years. I would imagine that will be the profile of the expansion tons. It won't be a one-off. Yeah. Understood. AUD 730 million, one project solves the problems. Mm-hmm. Yep. Understood. Thanks. Peter Steyn from Macquarie. Just a quick question on slide 22, so your dispatch volumes in North America and the breakdown of that. Curious around the value perspective there. I would assume that it sort of bends in the direction of non-residential exposure when you think about it from a value point of view. In the context of some of the branding conversation and evaluating that downstream opportunity, in the medium to longer term, what will your value bent look like? Presumably one would see more non-residential, more potentially residential in that mix as a value exposure. I think that's really where the coated and painted business plays. As John develops his strategy and we start to come up with brand, you know, branded premium offerings, we'll have much more opportunity to go into that non-residential space. I think with the shift into metal buildings, that 1% converts to about 1,000 tons per annum. There'll be some good branding opportunities to be able to grow out that actual segment through his business. Yeah. You'll see tomorrow. There's a growing opportunity here, Pete, around residential. It's still very small, but that's a market that we think there'll be opportunities for us to grow in, and that's the sort of growth that Kristy's talking about. That'll take some time. We're not expecting that to happen tomorrow. There's growth and an emerging market from a residential perspective. You know, clearly in the non-res or the industrial and commercial, that's our current focus. Yeah. That's where that branded and packaged offer will be targeted initially. Yeah. Yeah, shingles are pretty average roofs. you know, I'm curious how you think about that value split at the moment. Value as opposed to volume. Where does that go? If we're putting numbers in your mouths, but if we're at 60% non-residential value exposure at the moment, does that go to three-quarters, you know, percent? Yeah, I mean, difficult for us to forecast. Maybe the other way to think about it is, you know, part of the Coil Coaters acquisition is it's currently utilized to about 500,000 tons in the toll processing model. Our initial thinking at this stage is there's probably 900,000 or more tons of capacity in those seven lines. There's another 400,000 tons of value-added product we're gonna add to that mix. I can't do the math quickly in the head in terms of what that does at percentage. That's a target segment that we're clearly going after, which we see as the fundamental part of that acquisition. That justification for that asset was that we think we can double the capacity effectively of those assets and maintain our toll processing business, but move into that packaged and branded offer with the surplus capacity that we have. That's probably the other way. That's the way I think about it, rather than trying to. Yeah. Work out what it means in terms of percentage on the pie chart. Yep. Thanks. Hey, Emily Chieng from Goldman Sachs. Was curious about how you think conversion costs have changed since pre-pandemic. Everything but scrap, labor, electricity, alloying materials, maintenance, and all that. Yeah, I mean, without putting direct numbers on it, clearly alloys, additives, fluxes, all of that has gone up in price. That clearly has a cost impact. You know, labor flows through on some of the external services as well. But for us, just, you know, it's clearly gonna have a, you know, an impact on what those spreads mean. On the other hand, you know, for us, if you think about our expansion, if we add 850,000 metric tons but are able to do so with, say, 100 additional people, and then from an energy usage as well and other things, we're going to gain more total efficiencies from that. Our expectation is that in terms of conversion cost, that our marginal conversion cost on those, that incremental tons is quite a bit less. Although the alloys, additives, and fluxes, that piece of it obviously is fully variabilized. I think part of the pricing dynamic, Emily, that we're seeing in the market is around cost. This is not just a North Star issue. The industry is experiencing this. I think part of that aggressive reaction to prices when they fell was not only we don't like the price at that level, but we've got more costs we've got to recover. I don't think there's any doubt that's part of the pricing dynamic as well. We'll get started with BlueScope Recycling and Materials. Before I do that, I'll just give you a brief, kinda history about myself. I, there's a debate of when I joined BlueScope. I think that the most accurate day will be 2008 when they acquired Steelscape, and I was in Kalama on the paint line there with IMSA, Ternium for a short stint. So I've been, close to 14, 15 years with BlueScope, across paint line, then North Star, and now since December of 2021, joined BlueScope Recycling and got started with a fairly interesting journey there. As you've seen on the back, you know, we have three locations. We produce about 600,000 tons today of scrap among the three locations. We certainly have a pretty good business model, I would say. It's a brand-new company, so we're trying to integrate and leverage what we got with the acquisition. We got a lot of experienced people, and we have the capability to produce good quality, low residual obsolete scrap on all three locations. I think that when we look at our business, that's the key thing that why we are part of BlueScope and where we deliver value. The other piece is, we are just right next to North Star, which has allowed us to unlock the potential of a bunch of synergies, not only on the logistics piece and the handling of all the raw materials, but also how we work together to optimize our mix. That's kinda the big highlights of our operation. We certainly are the initial pillar of our raw material strategy for North America. We source, either via third party of our own, all the raw material for North Star: scrap, PR, HBI. BlueScope Recycling takes care of that. We certainly are focused on enhancing the value of those raw materials. We have ways to not only improve our own, but other third-party scrap, and that's what we are leveraging or trying to do with our strategy here with BlueScope Recycling. I'm gonna talk a little bit about the scrap that we handle at BRM and how we do it. We are about, I would say, 20%, you know, 20-30% clips, 20% clips and 88% on chips and bundles. The balance of it is obsolete. Obsolete is the most abundant scrap type in the U.S. You know, when we see the scrap pool in North America, obsolete is where we see the most. We export big chunk of it to other countries. I think for us, that's where the focus of BlueScope Recycling is, securing obsolete scrap, beneficiating it, cleaning it, and getting to the right quality to supply it to the mill. It's leveraging that in what we're trying to do with at BlueScope Recycling. When we look at the U.S. scrap industry and how it's made up and not sure how much familiar you are with it, but we do have an industrial scrap, which is the prime on the top. That's kind of all the prime, where the prime comes in. Basically, stamping plants, any industrial manufacturing will have a byproduct, which is prime scrap. It's mostly highly competed for. It's mostly sold in contracts, one year, two year deals, you know, formula-based pricing, heavily in, I would say, controlled and monopolized by and fought for by all the scrap companies. Then you have the obsolete. The obsolete is more a scrap type that is highly related to population centers. The more people that live in an area, the more obsolete that gets generated. Cars, demolition, roads, you get a little more of it. For us, as we look into sourcing raw materials for North Star, obsolete is a big source of scrap that is very hard to control. You don't see any long-term agreements. You don't see anyone being able to really monopolize obsolete scrap, whether it's peddlers, whether it's people, you know, just dumping it, whether it's, you know, demo jobs that occur by multiple companies. It's highly fragmented, and it's also, I would say, highly competitive, but not locked in. Every month you go and you buy, which allows us to really be competitive and target a pretty broad amount of sources within our region. On the Rust Belt, we have, you know, big population centers, whether it's Detroit in metro areas or Chicago or Cleveland, you know, Columbus, Cincinnati, we have a lot of sources around us that allows us to draw all that obsolete. That's why when we looked at our sourcing of raw materials, we thought about, okay, you know, we don't wanna control it all, but obsolete provides us with a huge pool of scrap that we can buy competitively and that with what we're doing at BlueScope Recycling, we can improve the quality of it and leverage our proximity to the mill to maximize the value we can extract for it. That's basically what we try and do. When you look at all the right side and all the other demolitions, small collectors, all that I would say is the obsolete route, which it's a lot of intermediaries or so, and they all play it at different levels. We as BlueScope Recycling, we're a scrap processor, meaning we can not only collect, but it can actually have shredding capabilities to produce, you know, low residual scrap versus other yards that can just collect it and then will sell to us. As Mark highlighted, we keep buying from all of our competitors, I would say, on the steel side. You know, whereas DJJ or OmniSource, we continue to buy from them in different mechanisms, in different ways, I think it's that's part of not only our own benchmark and how competitive and how well we buy, but also it's a way to stay in the market and not necessarily put all the eggs in one basket and leverage our business in one direction. We have the flexibility to shift around, and that's why we'd say we have a pretty flexible strategy. As you saw, and there'll be another graph when I talk about BRM and how we are set up as a business and how our growth plans. Well, we have a big opportunity. We have our largest customer across the street. It needs a lot of scrap. Just to reach in the future the 40% target, we're a long ways for it. We have a lot of things that we are doing towards that goal. Today, in the short term, what we've been doing is trying to just leverage what we have, our installed capacity. We did an acquisition, and I'll talk briefly about it, and you'll get to see a little bit about it as well. For us it's okay, improving the quality of the obsolete. You've probably seen, as you've seen in publications, the U.S. exports 20 some million tons of obsolete scrap. You know, I've already highlighted that we have a lot of obsolete scrap in our region. How do we improve the quality of it, how we measure the quantity of the residuals on it? Those are the things that we are trying to do. Conrad highlighted all that non-ferrous that we extract has value. The more we can capture all that and sell it, we actually recover that value for our business. What we're doing for processing capacity, we're installing pre-shredders. A pre-shredder is, the way I'll describe it is like a large paper shredder. It's a box. You'll see it in the video that I'll put in. It's a large square-shaped machine. You put a car in the top, and it comes in pieces in the bottom. Or you put, whatever you put in there, it shreds it. That increases the throughput of our assets, so we can actually increase the output of our shredder. It reduces wear on the shredder because instead of destroying the car of the shredder, this machine will break it down already in pieces, so you can load it better in the band, and it destroys or increases our the life of our own shredder parts that are wearable. The shredder is a self-destroying machine. You put in something there, and it's destroying the car, but it's destroying itself in the process, so we require to maintain them daily. The pre-shredder will allow us to not only reduce the wear but also increase the throughput and also enhances liberation, which for us is important. Liberation means we separate copper, more copper and more non-metallics out of the metallic piece. A lot of things around that. That project is ongoing. We have them, we'll have them fairly soon, I would say, you know, probably the second half of our, or next fiscal year. Then, you know, we're also looking further opportunities for processing and we've put a setup to process and clean up scrap, and we have it at the three locations. It's just leveraging that. Another thing that we are looking into is the nonferrous piece. The nonferrous piece right now on our Mansell acquisition, we bought that business with an extensive ability to process nonferrous. It's not only we learn from it in terms of the amount of return that we have of by selling all that nonferrous, but also, we've learned about the practices and how it's done. Now for us, it's okay, leveraging what we learned on Mansell with our two locations to get them to that same level of recovery of nonferrous. I'll touch on an example towards the end of something we're doing with our existing asset there to maximize it. The way we see all this advanced processing in the nonferrous piece and is there's a lot of things we can optimize in terms of robotics, AI, or things to improve. Normally, all the recycling piece, especially the when you go about removing copper on nonferrous, there's a lot of hand picking pieces. You call them pickers or so. They're at the end of the line. There's robots, there's technologies there to improve that. We're looking into those. We expect to leverage technology to improve our I guess, our efficiencies in separating copper. The other piece I would probably highlight in our growth and how we look at nonferrous is over the years, since I started kind of working closer with scrap companies back in 2010 when I joined North Star, you see businesses that are focused on like Mill Iron, which we acquired, that was the owner was focusing on paying for the steel and getting and making all the money in the nonferrous. He would literally say, "Okay, all the nonferrous money is for free, and I'm just paying for the steel." Versus a steel mill, which is, okay, we are going to pay for a full car. Probably, we can pay it with a nonferrous, then the steel is for free to the extent we can do it. Our focus is we're using leveraging the nonferrous component to literally reduce the cost of our input for the mill. That's kinda the mindset that they're both the same. I guess it's just a different focus. For us, it's literally maximizing the value we can extract on nonferrous so that we can actually lower the cost of the raw material for North Star. The role of supplying scrap to North Star and BRM's role. Conrad highlighted several things that we're doing. We're doing things on value-in-use. We're doing things on optimizing the mix, the logistics. For us, it's for the mill, it's very important to know the mix. When we're making steel, and Jeff and his team are experts in making steel. 10 years ago, it was mostly, in a certain way, a guessing game, in the sense that you know the ore-based metallics content of residuals, and you're guessing literally the copper and other content of the other raw materials, especially all the obsolete ones. Prime, historically, was fairly low on copper, but as more and more EAF steel is made, that has higher copper levels. Actually you've seen increase of copper content in prime. We got a bunch of obsolete. We don't know what is this in it. We can guess. What this business is trying to do and what we're doing is precisely making sure we can give North Star an accurate reading of the copper levels, and that's the work we're trying to do. We can separate and have a higher value, and having a higher value scrap allows us to reduce the cost of higher cost ore-based metallics. When you look our supply, well, PR is the highest, it's the most expensive, you know, followed by prime. HBI are kinda around there. And then you'll see obsoletes kinda in the bottom half of our cost. If we can improve that, we have a competitive advantage, and that's why we're working on it actively. The some other things we've achieved is more visibility. Before we were buying scrap, and we the mill had some visibility of what was scrapping with scrap, but we really didn't understand it to the extent we do today. We are still learning a lot about it. Now we can provide not only visibility of how the flows and of the raw materials are and the pricing, but also the recycling business can understand the forward-looking order book of North Star, and then what they will need in terms of the qualities and the grades they're gonna make, and we can reverse all the way to the sourcing of it, which before the scrap company was acting on its own behalf and not trying to sync with the mill in any way. The other thing that we're looking into is inventories. Normally, we hold inventory here, you know, we have the ability right now to flex that inventory and put it on the yard or put it here, avoid double handling, and kind of streamline the way the flow and the logistics and all the handling of the raw materials occur versus before, you know, North Star had to do its own, and the scrap yard was doing its own. Now it's about, I'm gonna send a coil to Chicago, and I'm gonna bring scrap back on that flat bed with some crushed cars on top or so. There's a lot of opportunities around what can be done in logistics, in flow and of materials. On this graph, we showed you, and we talked yesterday with some of you, I guess, a little bit of where we started in 2022, you know, with about, you know, 300,000 tons. You know, we're now in a year, we've doubled that supply. We intend to continue that growth path. You know, we're talking, you know, maybe a couple of years more or so, we're trying to get to 1 million tons of own supply scrap by BRM to North Star. Again, it's aligned with our strategy in terms of securing supply for North Star, getting that leverage on the knowing the content of the copper levels on it. This is Mansfield. This video will give you a pretty good overview of the Mansfield operation. When we tour recycling this afternoon, you're gonna see a smaller footprint. I mean, larger and probably in size in the land footprint, but actually in buildings or so Mansfield has probably double the amount of equipment there. It's all on the non-ferrous piece. You'll see a lot of non-ferrous processing in this operation that I'm about to show you. I'll let you kind of watch it, and then we'll get back to. The Mansfield location is a 40-acre site that is close to major highways and within hours of nine major steel mills. Here you can see suppliers delivering scrap on the inbound truck scale, passing through radiation detection systems with multiple cameras recording the transaction. The scale operators record the inbound weight of the truck and then direct the truck to the appropriate unloading area. Material handlers unload the scrap automobiles and obsolete scrap. Most flattened automobiles are placed into the pre-shredder to be broken down into smaller scrap. This helps with wear on our machinery and helps to identify heavy pieces that cannot be shredded, which would otherwise damage our automobile shredder. This animation shows how the automobile shredder works on scrap using heavy-duty hammers that spin and break down the metal, effectively shredding it before discharging the remnants. Once discharged, the remnants travel to the mag stand, separating the magnetic scrap from the non-magnetic scrap. The magnetic scrap heads to the ferrous finished product line, where employees will pick out non-conforming items such as copper and fabric. The remnants will continue down the conveyor to be stacked in piles. The finished shredded scrap is then loaded onto the trucks and shipped to the consumer. The first stage in processing our non-magnetic material is the eddy current. Non-magnetic material is often referred to as automobile shredder residue, ASR or fluff. The eddy current separates the ASR aluminum and copper from plastic, foam, glass, and dirt. You can see this rare earth magnet repelling the metallic components over the end of the line into a pile. The aluminum that the eddy current has sorted is then sent to the final separation stage, where it is cleaned up and is sent over another rare earth magnet to repel any leftover metallic components. The material is then separated into light and heavy aluminum. The micro fines plant separates very small metallic components from the fine ASR. This includes copper, brass, and precious metals like gold, silver, platinum, and palladium. It's truly an above-ground mining operation. The insulated copper wire building is processing recovered copper wire and stainless steel from the ASR. The stainless steel is handpicked, and the wire is separated by sensors that signal a burst of air, which is then shredded into smaller pieces, separating the plastic coating from the shiny copper wire. Once the metals have been removed from the ASR, it is ready to be sent to the landfill as alternative daily cover. The fluff is used in place of sand or dirt to cover the trash in the open landfill cell at the end of each day. Using fluff as an alternative landfill cover saves money, speeds up operations, and offers an environmentally preferable approach rather than using dirt. Fluff provides these benefits because, unlike soil, it does not need to be stripped off the landfill each morning. This reduces the amount of soil that is used. Quick video of our Mansfield operations. As you saw, it has a lot of non-ferrous downstream operations. The shredder here in the Delta facility doesn't have a lot of that separation. We just do go the basic aluminum separation, and you'll see some of that this afternoon. Moving along to the progress on the acquisition. Certainly, it's been a fairly quick time for me. I mean, it's been a year and five months or so and, you know, back in December of 2021, we were starting MetalX, and we had about 20,000 output back at the start. We had half of the company because we didn't got it all. We back office or so, we have to ramp up, get all that people there. The good things is that part of the acquisition, we got a pretty strong operating group. We got all the operating group. The knowledge in operating the scrap yards was there. People with 30 years of experience in the industry or so, very knowledgeable and. I think that that was kind of key for the success we've had so far. We got all the commercial people joined us as well. I think that the key things were there. We have to Kind of the rest of the, of the team, so to speak. Also we brought over all their team that was sourcing for North Star since 2010, all the scrap and the pig iron and the HBI. We kind of put together a fairly good team fairly quickly. We're not even, we have just signed the acquisition where we're starting to look into the Mansfield acquisition. I would say it's been a pretty fast-moving, fast-paced growth, but also very carefully planned because the Mansfield, we did a very thorough due diligence on that asset before we decided to acquire it. It's been a very successful acquisition so far. We've improved certainly logistics in how we feed scrap into North Star and improve our knowledge where Conrad touched on our VIU project, our value-in-use. I think that what I've seen in we certainly have the benefit that we looked at the industry for years, we saw the struggles that Nucor and DJJ had. We saw what SDI and OmniSource did to try and blending together a steel mill with a scrap company and how to make it work. It's always not good probably sometimes to be in the bleeding edge, where you're trying things. When you have the ability to... We've talked to them for years, and we talked with Omni and DJ for years, and they'll always say, "Oh, well, the mill doesn't understand these. The mill has these issues. They don't understand our business." Having seen what they've done, I believe that we're in a very good track to actually get past those initial things and building synergies around the teams. Part of this project that Conrad described is actually a very fast-paced project that is bringing the two teams together, and they're working together. I think that that's gonna be the success of BlueScope, is leveraging the scrap and the mill knowledge, but also bringing down the walls and providing that transparency in the supply chain fast. We don't wanna take years to learn how to work together. We have a very short time, and we're achieving it, and that's where we'll unlock some of that value and knowledge of the scrap industry. Challenges, well, you know, buying two businesses with two different systems and, you know, and family-owned businesses, it's been a challenge. You know, we certainly, the IT systems are not what we would like to see. They're not on BlueScope standards. We're fastly moving towards implementing. We already selected a solution. It's gonna take us probably, you know, a year and a half, you know, to get the new system in place, but it's gonna be a system that runs all locations and brings us kinda together and simplifies the whole IT landscape. That's been already addressed. We are addressing a little bit of the shredder motors. When we bought the Delta asset, it has two motors, the one you toured today, and they're in tandem working. That setup has proven to be quite less reliable than the Mansfield operation that has a single AC large motor. Again, we're leveraging the learnings from one company and the other one, trying to not transform Mansfield into MetalX, but neither MetalX into Mansfield, but rather see where we can see the value and unlock the learnings from one business to the other and get together into a new company. The same's happening with culture, right? We have to push our BlueScope culture, our safety culture into these businesses. And we are, we're trying to push our safety culture, the way we address the North Star continuous improvement philosophy in how people are engaged at our North Star operations in trying to have kinda BRM adopt as much as they can from that culture and to make it a very successful shredding operation. One thing that we cannot control is the downward scrap price cycle is in the last year. Second half was pretty challenging. We had actually a price inversion, meaning the prime scrap price was below the obsolete, which is like the high quality is lower than the lower quality normal scrap. Certainly it was a challenging time. It lasted for six months or so. We weren't expecting that. It was tough, but I think that our businesses did fairly well given the challenge. Again, one of the things that we saw is that the non-ferrous was fairly stable and all the set for non-ferrous revenues were fairly strong. it gives again the view of how we can leverage non-ferrous to provide some stability when we have a down cycle on the ferrous side. Lastly, before we go into some Q&A, health, safety, and environment, as I said just a moment ago, I guess safety is one of the key and the key thing for BlueScope. We have a lot of things we are addressing, fires is one. You'll see in the news, scrap fire here, scrap fire there. We've seen our own couple of fires here and there. Little fires, we control them, but at the end, we're putting infrared detection systems, we're putting things to address fires in the yard. I think that, normally they occur in the fluff, what you saw in the video, that it's kinda has foam, has some materials are combustible, and sometimes a small piece of metal, pretty hot, falls into that. It actually stays there and kinda over time, you know, you can catch fire, smolders for a little while, and then, normally in the course of the day, when you have all the crew, it's not a problem. They'll see it, and they'll put it out. The problem is when you shut down on the weekend or so on, there's no one at the yard, and that's when those fires can start. You know, sometimes you have batteries short circuit in a car. It's in a pile of cars, shredded cars, and all of a sudden the fire starts, and you need to address it. We're addressing fire, which is certainly one important thing. Live in mobile equipment, you know, for many at BlueScope. Me, myself included at the beginning was when you visit these yards and there was not signage. There were no mobile people interaction. You'll see today that it's a highly mobile equipment-intensive, there's really not a lot of path. There's an open operation with a lot of open areas, and there's really no clear path or so for people to walk in Mansfield as well with all the buildings. There's a lot of work that's being done in terms of putting the right signage, allowing people to making people go to man doors instead of overhead doors, and putting all the things in place to protect our employees and to make it a safer or the safest place we can make it. We put some guards on our cranes. We put some lights on the forklifts. We're trying to put equipment and kind of get it to BlueScope standards. The way I see it, everywhere I turn, we have a lot of opportunities to get into BlueScope. I think that we will see that accelerated growth in all the areas because there's a lot of opportunities and low-hanging fruit. Certainly, I think it will get tougher as we progress, but I wanna get to where, okay, it's getting tougher to find those opportunities. Last thing here, I guess, on the reducing the landfill project we had. When we bought the Delta and the Waterloo location from MetalX, as I told you, they had limited downstream capability, so we can separate aluminum and that's as far as we go. Immediately after acquiring Mansfield with all the downstream operation, we did a temporary project and checked what happens if we send what we were sending to waste in Waterloo, send it over there and process it in the downstream. You know, we did some trials, and we saw, okay, well, we can reduce 100 tons of landfill and get about, you know, $130,000 out of it or so. That was a trial, so we expect to reduce probably 10% of the Waterloo waste, converting it to profit by just... This is net of all the transport costs or so. We're actually looking for ways to improve and reduce our footprint in terms of waste. There will be other opportunities. There's glass, there are plastics. I think we have a long way to look into how to even further reduce that waste stream. That's a challenge the team has and we're working on. It's replicating things here at Delta, as we did with the pre-shredders in the motor, looking into the downstream and extracting all that value. Again, it goes along with our sustainability strategy because we are not only recycling the steel, recovering all these non-metallics. If we can recover also plastics and glass in the future, we all together working to make it even a fairly more sustainable operation as we can. I think that's... That's it. Okay. Any questions? Megan, yeah. Thanks. Megan from Barrenjoey. Just the focus today on non-ferrous just seems to be, I guess, a little bit different to what I've heard in the past. I'm just keen to hear, I guess, how that strategy has evolved. Was non-ferrous always sort of the focus when you initially acquired MetalX, or is it something that it has evolved with the second acquisition? I'd just be keen to just get some, I guess, sort of rough numbers about how we should be thinking about non-ferrous volumes as you ramp up the ferrous side of things, and expected CapEx for some of those sort of AI, and processing investments that were mentioned. Sure. Well, there were a few questions. I guess I'll first talk about the non-ferrous piece, right? When we got into Metal X, it was about the synergies, and we identify and we're progressing with those synergies with the mill and the recycling on the ferrous side. We say, you know, we need to clean the obsolete, we need to achieve that value, we need to help the mill optimize, and we need to improve all the logistics and material handling around it. That was our focus in initial term. The Metal X owner did not wanna sell the non-ferrous operation. He was focused on aluminum or aluminium, either. He was trying to focus in going into that direction. He was not willing to sell or wasn't considering selling the non-ferrous piece. So we evaluated kinda alternatives in terms of, okay, what we wanted was the ferrous. We really didn't want the non-ferrous piece as a must to do that transaction. I think that's when we acquired Mansell, and we saw all the value of non-ferrous. We say, "Okay, we can leverage this piece as well." He wanted to sell the whole business, so we had to evaluate both ferrous and non-ferrous. Now we're focused still on ferrous, but we understand, and we see the value we can extract on the non-ferrous piece. As I mentioned, while trying to make it, I guess, our ferrous side as low cost as we can by leveraging that non-ferrous content. When we acquire the MetalX assets, we acquired them with all their operations. We didn't, they didn't took equipment out. He just wasn't focused on non-ferrous, and the only thing that he is doing for us is selling some of the non-ferrous material from the Delta location. Basically, he wanted to stay in the non-ferrous business, which he can. He cannot compete with us on the ferrous, but, was not also a fact that we... He took the non-ferrous team, so that was the other thing that he took. Other than that, all the assets and everything remained with the assets that we acquired. He didn't dismantle, I guess, our operation in terms of assets. Megan, perhaps the way to think about it is. What we've discovered with Mansfield is the value of the non-ferrous. You shred scrap, you're gonna get ferrous and non-ferrous, right? It's a by-product of the process. What Mansfield has demonstrated to us is there's value there, and fair to say they've taken it to the nth degree. We've never seen anything like it anywhere else. It's been quite a learning for us. There's now gonna be an opportunity for us to think about that, whether it's fluff coming out of Waterloo being sent there or whether we do something here at our other sites. The way to think about it is it's actually just gonna lower the overall feed cost for North Star. At this stage, we're not gonna forecast what non-ferrous volumes are, but there's a fantastic synergy opportunity there for us around the non-ferrous, which will show itself up in a lower cost of raw material for North Star, but it's probably just a bit early for us to be contemplating whether we're gonna talk about non-ferrous volumes or not. Yeah. Without, you know, giving any numbers, the investments, the capital investments to put non-ferrous capabilities, AI, robotics or so is fairly small. They'll be incremental. It also is not like we're gonna all of a sudden spend a big chunk. They're just incremental- Thinking $10 million. Something like a $10 million investment. We're not talking massive capital investments here. So. Why own a scrap business? You've not offered the last 10 years. Well, strategically, why do you really need to own a scrap business? In the sense that, you know, are you forced to own a scrap because you're seeing that other steel... In a perfect world, steel spreads should be a function of, you know, steel price and scrap input for electric arc furnace producers. In that world, you don't really need to own it. Is it because others now have their own scrap businesses and you think that that spread will no longer be truly representative, and competitively, you need to be 40% self-sufficient? I'm just trying to get a sense of why you need to own a scrap business. You don't own input business in iron ore in Australia, for example. Yes, I made a couple of points. It is a mix, Paul. I mean, firstly, we don't own iron ore, if you think about the competitors we'd be competing with in iron ore on the scale of the big guys, I mean, you're never gonna be in the money, right? This is a different business model, very fragmented, much smaller. You're absolutely right. There was a component that was when we drive for three and a half minutes across the road to Metal X shortly, I didn't want someone else owning that asset. I mean, it's across the road. There's a rail spur that runs from that facility into North Star. There's no doubt part of it was location and protecting our own supply chain and having a play in it. It's why we've been at pains from the start to say, "We're not looking to set up a standalone scrap business here. That's not the objective. On top of that were these synergies that Hector's now talking about and that Conrad talked about earlier. The ability for us to focus that business now on what's best for the mill, we think it's very interesting and there's value there. The non-ferrous piece is just a bit of a bonus, quite frankly, and our eyes have been opened it up to that as we've got into the space. You know, in a perfect world, do we need to own it? Probably not. We're not operating in a perfect world. Cliffs acquired Ferrous Processing. We've already got the big guys with DJJ and Omni in the market. yards that are close to the mill, and we think we can get value out of them as a standalone business and synergies on top of that, seem to make sense to us. It was a bit of a mix of logic behind why we stepped into this space. You're probably right. Perfect world, maybe we don't need it. We don't live in a perfect world, that's for sure. Hi, again. Just on the non-ferrous, I understand that, you know, that you're not gonna give guidance, and I'm not gonna go you know, tomorrow and start modeling it, really. I mean, as a sort of benchmark, you know, we look at some of the pure play sort of scrap producers out there like Sims and Schnitzer and their sort of non-ferrous volumes percentage of around 5%. Is there any reason why it's any different here? I think we're achieving. I think that we had in one of the graphs the, you know, the non-ferrous component of it. Aluminum, copper, we're around that 4%. There you go. I wasn't watching. Yeah. Again, guilty. Yep. Second point taken. Second one is around, just procurement of scrap at the moment. I mean, sounds like the market's pretty competitive, for procurement of scrap and collecting at the moment. You know, obviously you've got, you know, this sort of regional play here. Are you seeing any sort of competition for scrap procurement at the moment and difficulty sort of getting scrap? I think we've seen actually plenty of scrap. The price, if you'll track it, is dropping or so. It's cyclical in nature, some of it, like the obsolete gets tougher in the winter always. I think that we are not struggling with sourcing our scrap. I think that what price differentials do is they make the right scrap go to the right people. To give you an example, when prime opened up at 200 spread, all the rebar mills and all the people that shouldn't be using prime were not using prime. They focused on obsolete and rebar and, you know, lower grade, higher copper-bearing obsolete grade. I think for us, what we've seen is we're able to buy all the scrap that we want. I think for us it's about how we can lower the cost and also optimize our usage or our feed of the mill. The scrap grades will be there, lower copper-bearing, higher, you know, low res, what we call low res, which is the high quality obsolete, right? The regular obsolete, they'll be there. We wanna increase our ability to move with the market and flex our mix of those grades based on what's happening. That's why we're also not focusing to be like 100% self-sufficient. We wanna keep that dynamic that we have of being flexible and increasing decreasing PR and increasing it HBI, you know, obsolete scrap or so. We are not throwing to buy any of our scrap today. We fill the mill, we buy all that we want. I think for us is a cost play of how much we can lower our cost. Jeff, sorry. Why don't you want copper in your scrap? It causes hot shortness, so which, you know, for the end quality user, it causes defects. It softens the steel in areas they don't want, so it causes a lot of grief. For flat roll, it's a big deal. It's a very big issue for flat roll, not as big an issue for long products. Hence, sorry, all that focus this morning around copper. That's why the focus is on it. Thanks. I'm Chen from Bank of America. Just on your slide 50, again, back to the 40% self-management scrap. At the moment, your capacity is around 600,000 tons. To have 1 million tons of scrap. Yeah. Self-managed, I guess you need Good point. incremental, 400,000 ton planning, right? I guess, is that incremental 400,000 ton planning of scrap will be pursued through acquisition? You say you can grow organically within MetalX just on the scrap to have 1 million ton, you know? Yeah, to go from 60 to 1 million ton. With the, yeah, with the mill start, ramping up. We have several ways to approach it, right? Thanks. Without getting into details, I think that we are always looking and we'll be looking for any opportunities like Mansfield, if it makes sense, if it has a good return, if it's located in an area that could match our footprint as we talked about, right? We wanna buy our scrap as close as we can to our mill. We don't wanna stretch out as logistics costs us a lot of things. Also our current assets have capabilities for growth. We talk about pressure areas, but also, you know, we have a pretty good location in Waterloo. It has capabilities. All of our locations have capabilities to increase its output. Delta runs, you know, fairly much can run seven days a week. Doesn't run all the time, seven days a week. We have two of our locations run with one shift. We can increase shifts. I think we have multiple ways to increase the output of our facilities. The shredder capacity is there, I guess, to increase. Also we have third-party suppliers that we can leverage their own capacity as we grow our operation in our, in our, call it scrap beneficiation. The way I put it is, I think we can get to that 1 million. We'll get to that 1 million. The mix is gonna be based on what makes better sense for us economically and not increasing the cost. We have plenty of options that we're continually evaluating. It's not a heavy capital call, though. Yeah. We're not relying on large M&A to get us there. Yeah. It's mostly incremental CapEx, as we touched on, sort of a $10 million processing line, additional utilization of facilities. It's a big site when you see MetalX this afternoon. It's 60 acres. We've got lots of capacity to grow there. It's not capital heavy. Right. The current 600,000 tons of scrap from- Mm-hmm. The current capacity, you are confident you can grow up to 1 million tons within the business rather than through acquisition to acquire another scrap company? Yes. As Hector said, we're not, we're not reliant here on buying other businesses. You know, we're also, as we said, the 40% isn't absolutely the only number that we're focused on. I mean, if another yard became available in our region, that would be something we would consider. Yes. Okay. Yeah, thanks a lot. We can get to the 1 million without buying another yard. That's why I'm saying that we have options to get to the 1 million, and it's not necessarily, oh, we need to buy one yard, another yard to get to 1 million. Okay. We can do it without buying another yard. That's why we're talking about capital investments. We have a, I would say, a low capital investment way to get to that 1 million. There could be something that is attractive enough for us to do an investment and get faster or in a different way. Then we may even raise the bar down the road if we need to, I guess, if an opportunity would come. Okay. Thanks for that. Hi, Hector. Luke Smith from AustralianSuper. Can you give a bit more detail on why prime dropped below obsolete? The second question to follow that is, do you have a maximum capacity? I think it's your slide 46, how much prime you can put into these facilities as a percentage of total input? Yeah. Well, I'll get to slide 46, but I think that, I'll try and answer your prime. Scrap is a matter of supply and demand. What we experienced was an abnormal surplus of prime. There was a lot of prime. We could get it all over the place. When you get a lot of it drops. The thing with prime is that prime is a by-product of industrial activity, so they can't stop it. Like, they can't slow it down, it just has to flow. It just flows. Obsolete, on the contrary, it's a little more price elastic. Price is too low, it can certainly slow down, right? Winter or other conditions or so will affect you. Also in the export market, you know, Turkey picks up and starts importing a lot of obsolete. That drives obsolete price or so. I think that the levers in the market conditions affect them differently, with one being more price elastic and the other one's more manufacturing output driven, you know? Of course, both of them impacted by consumption. What we experienced was a fairly tight obsolete market. What you saw in the scrap market, late last year. You saw plate iron super expensive. You saw rebar super expensive. You saw a lot of other, you know, The hot metal was struggling a little bit, but the other steel grades were fairly highly priced, and they need low-quality scrap. They actually want obsolete or so normally buy obsolete. With the export market in those, the demand for obsolete was fairly strong and prime was weak. It's been only two times. Last time lasted two months, this time lasted like six, right? It's a, it's not a normal condition, but it can happen. It just won't last, I mean, we always said not too long, but I guess six months was fairly the longest I ever seen it since probably 2000 or so. It's been a pretty, I would say, a significant event. Now the other question was the slide, what, 46? Yeah. What's the reasoning why you can't increase your prime intake if it's cheaper? Well- It must be, sorry, the next. No, it's different on this page. That one, yeah. That one. Well, here, what we were talking about is our supply, what BRM controls today, right? How or when we say our output, how much of it is prime, right? We have about that 30% prime. When you saw on the slice of the mill, you know, they could use 40% prime, they can use 45%. It varies, right? I think that Jeff will be the expert on more on that piece. I, but I can tell you from my end is, and my understanding is the amount of prime is, has less density, so it has issues with that. That's one thing that will affect you, how much dense, how much you can load into the, into the furnace. Also from a price perspective, it's a higher cost raw materials as a scrap, right? The levers, what we'll be playing with commercially, it'll be a cost play. If it's more expensive, we wanna use less of it and use other raw materials that are lower cost that we can beneficiate to get it to a similar or close to that quality. That's the play with prime. Then operationally, there could be some constraints that Jeff would push, but he'll always be looking also at the cost component of the mix. Then based out of that, we'll try to maximize or minimize, you know, with some constraints operationally that we may face at our melt shop. Okay. Sorry. You, you talk about the cost, it's less dense. When you're talking about cost, it's in volume of recycling? Yeah, yeah. Well, you know, scrap, you know, is priced at the cost per ton, right? The cost, the volume or the load is the same, right? It's a cost per ton basis. It's most expensive on that basis. In terms of density, we're talking that a ton of prime in volume, it'll look like more. It weighs the same, but it has more volume. When you're putting it, you may, you know... Jeff will be the most better one at answering the question in terms of how much he can feed into the furnace, but he would have a constraint in volume with prime. Jeff, yeah, if you can chip on the volume piece of prime and the constraints. Yeah. With respect to clips, you know, I think Hector talked about its value-in-use. We can use a certain level, we're looking at the value into that bucket and what we need for the quality downstream. That number does vary based on cost. There are some limits in the furnace just in terms of Hector talked about just in density. You'll see when I load a scrap bucket into the furnace, if I overfill a furnace, obviously my density is not right, I have to use some heavier material to make up that difference. You know, for clips to be a big number, historically, that's not a bad spot to be in. That means your market's all out of whack. The value-in-use will continue to adjust our values of all those products as we make every heat. That's how that process kinda goes. I hope. Did that answer your question for? I apologize. Thanks, Jeff. Hi. James Eginton, Drummond Knight. Just going to slide 47. It's a quick one. I'm just curious, the export volumes out of the U.S. fall 2022, 2023, and then sort of pick up 2024. What is that a Turkey factor, economic growth factor? Yeah, the export volume is heavily dominated by Turkey, right? Turkey is the market that buys. We have, we do have on the West Coast kinda flowing, some flow, but that's fairly stable. For us, for North Star, for BlueScope here, with our steelmaking operations, it's what happens on the East Coast that would affect us. I think that there's expected, Turkey's expected to increase the amount of imports or steel production to rebuild after their earthquake. Hasn't happened at the speed that we expected, but we see a strong export market there. We, what the export does to us is that the mills start feeding the flow of scrap goes into the East Coast. When the they're filling those ships, you'll see people drawing westward. When there are not a lot of export, that scrap stays here or actually flows in reverse into the highest paid market. Right now, those figures of the export being around, you know, increasing, I would say is probably most driven for people expecting Turkey to increase its consumption of scrap. Okay. I guess for 2023, it probably implies lower pricing expectations than if exports are down. You're talking about which slide? Sorry. Slide 47. The one page, yeah. We put a Q&A page in the slide. It's in between. You go one forward. Yeah. That one. Yeah. Yeah, yeah. Okay. You'll see a slight drop, but there's been a slight drop. The drop that you've seen on export has been also because of Russians, I would say, dumping material into that market. Right now for them, the Turkish market is particular flexible in the sense that they can use scrap, but they can also use billets and other raw materials. When the materials from East, from Asia or Russia flowing, they're a lower cost, it can actually affect their amount of scrap they're buying from the U.S. or other European sources. The second question, we didn't really talk about the third-party HBI/DRI opportunity. You've obviously got the agreement with Cliffs in place, when you talk about the third party, do you have any desire to grow that Cliffs agreement beyond the current tonnage? What other opportunities exist on the HBI and DRI front that sort of located in a reasonable proximity? I guess the key thing that you touched there was proximity. I think that HBI and DRI, we were approached by multiple sources, whether it's Asia, And Middle East. We certainly hone in with the most logical one, that was Cliffs. There are opportunities there. There are other greenfield and other projects by many people that are looking there for opportunities to develop DRI or HBI production in places like Canada or the U.S. I would say that even though, you know, today we have that HBI supply, we have and we have and we had in the past multiple options, even voestalpine, you know, now our mill. I mean, I spoke with them recently, and they were, like, interested in supplying if we wanted some. Big River is a big consumer of their tons, as far as I know. They are targeting some local markets, local consumers with their HBI. Again, it goes back for us to a cost play. Cliffs seem to be a fair contract close to us, and we went with that one, but they're not the only game in town. Right now, it looks like the best one for us, and we are for them. We do have options and we're looking into other options. Interesting space. A lot going on in this space, the whole green steel thing, right? There's a lot going on in this space. Not just HBI, DRI, the whole pig iron space as well, right? There's lots of chatter in the market made about people that are thinking about where there's iron ore reserves, who's got access to them, biochar. It's a really active space at the moment. It's interesting to be where we are and sitting back and watching it. I think there's gonna be more opportunities for us. From a supply perspective, yeah. Peter Steyn from Macquarie. Sorry, Hector, just a follow-up on that U.S. scrap generation picture, because it's very clear that this is a regional game. How confident are you about the medium term, medium and longer term supply of obsolete and prime scrap in this region, in the context of the competitiveness in this region? you know, do the economics, or are you confident that the economics stack up on the longer term basis, that there's not economic risks in this region that potentially upsets the relative scrap generation here versus the southern part of the country, as an example? Yes. Well, it's, you know, I may not have all the, you know, the forward-looking view. I can tell you that, what we've seen, even with the, with the credit being announced in the market we're facing today, are playing into, improving the quality of obsolete. It's just addressing potential issues we don't face today. If you ask me, do today, do we need that, you know, to survive or to make successful as we have been? Do we absolutely need that low res scrap? No, I think we can buy the, you know, shred and other things or so, and, you know. Yeah, there's some benefits we're unlocking, but we have enough scrap, regular prime, and even pig iron, with even with all that happened, we could buy it all today. I think our play is more about what we see in the future and how we look forward to improve our cost model. That's why we're looking into, okay, improving the quality of the obsolete. If you look right now, as I mentioned, this year, we have prime surplus. We're running at capacity, and we have all the prime we can get. I mean, we actually pushed back and say, "We don't want more." It was even cheaper than the obsolete. We are having no issues securing our scrap today. The question is, you know, is this gonna continue, you know, with expansion and other people, things are happening, is this gonna continue to be the same? What we're saying, "Okay, we believe there's enough prime generation in the area. It'll be competitive." Do we wanna compete for it? We will. We wanna have alternatives to change our mix and not be dependent on, okay, well, we just need to buy these two, three types. That's why we're focusing in this opening of our portfolio and Comes back to your question, Paul. This is part of the logic as well, why we felt we needed- Which you so rudely brushed away. Part of the logic was, this is not just about. Real question. Yeah. Part of the logic is just not here and now. It's actually what's coming across the horizon. We're mindful of looking forward as well and ensuring we've got options, and whether it's DRI, HBI, all of, you know, the pig iron stuff that's going on. This is, as Conrad said right at the start, this is our biggest cost by a country mile. Having a strategy in place to deal with whatever might emerge going forward is we think a prudent approach. Would it be unfair to describe this as an option? In the longer term, DRI and HBI will probably end up filling a far bigger position than 20% of your supplier. Well, I think the HBI, none of us really saw 2.6 million tons of HBI coming into the market. Cliffs have talked about the ability to expand that facility. Some of the other work we're seeing that we've touched on, I think DRI and HBI are gonna be a bigger part of the market, there's no question. Yes. Sorry. One more quick one. What's the time lag between when you buy a ton of scrap and then when you sell it to North Star? We buy it and sell it the same month, and we just follow the market. Oh, okay. One more. The previous presentation you mentioned, nuclear power. Have you actually... Is all your power sourced from nuclear, or is it a mix? Yeah, we buy off the grid. Largely in Ohio, you know, right, a few miles away is Davis-Besse. Reactor there. There's a whole series of other ones in Ohio, a little farther away. We actually buy off the grid, which is a mix of various sources. As part of our purchase agreement, we also buy the nuclear credits that go with that. In that way, you know, we're both in, you know, basically we're covered in terms of all the electricity we buy with credits, which is what takes our greenhouse gases down by about half for an EAF producer. Yeah, just continuing that conversation then. The comment about you're planning a carbon-neutral product late this year. I presume that the nuclear credits sort of feed into that. What's the drive to do that from a perspective of, you know, are customers willing to pay a premium? What is that premium for that product? I mean, you know, it's clearly for... You've probably seen a lot of announcements out there. You know, we're gonna figure out our marketing and all of that kind of thing and how it ties together with BlueScope North America and BlueScope more broadly. Right now the first areas we're really seeing is, you know, automotive, agriculture, HVAC-related, where there's the most, where there's the most interest and where, you know, many companies have started to put out a target for what percentage of their steel consumption will be carbon-neutral steel. In terms of what the premium is, you know, I'd say that there is, there is a premium associated with it. You know, definitely a very very hot topic in the industry and with our customers as to what that what that turns out to be. We're definitely not ready to say that the premium is X or Y, but there is one, and we're pretty excited about it. Okay, thanks. One other just on, just back on discussion on demand or comments on demand. It'd be remiss of me to sort of not ask about, you know, what the views are more around demand now. I know you've made some comments around auto backlog and, yeah, non-resi sort of strength, but is there anything you can add to that or what you're seeing sort of now? Thanks. I mean, you know, I'll start off. You know, auto, you know, auto's been strong, this first, as everyone's seen. You know, we're sitting nicely over that 15 million autos mark, which we consider to be really good and also with some, you know, potential upside there, going back to pre-pandemic historical. What our teammates would say regarding non-residential is it's remained reasonably strong, despite a lot of the, you know, the risk around recession. At the same time, you know, manufacturing has come down a little bit, is what I'd say we've seen. Just as a follow-up to that, just around the service centers and sort of their buying behavior at the moment. Like, can you maybe just expand on that, given that they're your main customer base? Ashley's right behind. Yeah. Good. If you wanna turn around and hand the microphone to Ashley. Hi, there. What I would say right now on the service center front is, you know, they're observing similar lead times with the mills, right, as we've seen 5-6 weeks. You know, they're maintaining their inventories, just as we saw probably, what, 6-7 months ago. They're staying close to those just because of higher price inventory and watching their releases come in from their auto, as Conrad said, which we have a lot of exposure to. Auto continues, I'd say, to surprise us, and we have some customers who claim, you know, they continue to try to keep up with those. Overall, I mean, our service center book of business looks very similar. Yes. Hi, this is Chen. Just a follow-up on that carbon-neutral products from U.S. We've seen a lot of Australian metals mining companies taking advantage of the Inflation Reduction Act. Do you think there's any benefit from BlueScope for what you've done with New Zealand government, like half fund it to build the EAF? Is there anything that, in your space, that you can, you know, use the policy which we've seen from a lot of Australian companies? Thanks. Yeah. I, if I can give a, maybe a BlueScope answer on that. It's, it's probably, as I touched on earlier, Chen, this, I think this is just gonna drive a massive amount of investment in this country. I mean, the country has the scale to support it. The, the incentive program is enormous. You've seen people like Andrew at Fortescue talk about how the focus has shifted to here. You've got the Europeans trying to react to the scale of the IRA to stop investment flooding out of Europe into North America. It's hard, hard to know how you compete with just the scale of the incentive that's been put in place by the U.S. government. I think that drives manufacturing, reshoring, investment, renewable energy, and as I touched on right at the start, all of that is steel-intensive. From our perspective, it goes to the medium and longer-term demand outlook. I've seen estimates from one. I've seen two estimates. One was about 1 million tons a year of steel consumption that the infrastructure and renewable energy industry would generate in this country, and I've seen another estimate that was about 5 million tons a year based on the addition of the IRA. Whatever the number is, I don't know, but I can't help but think with that sort of level of investment and the attraction for reshoring of manufacturing and the opportunities opening up here, all of that's steel-intensive, and that's good for our businesses in North America. Given that positive outlook, the forecast that you had for non-residential construction and the fall off from 2023 to 2024, How much credence do you put in that forward forecast? Do you want me to take that one? Yeah, well, okay. Look, they're market estimates, right? Yeah. At the end of the day, we take the experts' opinions. Who knows, Paul? I... And again, if it falls off next year, I keep looking at that medium and longer-term perspective and thinking, "Why the hell wouldn't we be here," right? This is a market to continue to operate in. It will be volatile. It'll fluctuate. It won't be linear. There'll be years when we have prime at a lower price than obsolete, and everyone scratches their head and says, "You know, how does that happen?" I keep looking at that longer-term perspective and thinking, "This is an attractive place for us to operate. With that, we might, call close on the formal proceeding.