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American Metal MarketRecycled Aluminum

Nonferrous Scrap SeriesChicago, Illinois

November 08, 2011

B. DAVID AND CO, LLC

Bobby David410.285.6931

Cell – 443.838.7744bdavid@bdavidandco.com

According to the U S Geological Survey 2.7 million mt of scrap aluminum was recovered and consumed in 2010.◦ 59% from new manufacturing ◦ 41% old scrap discarded products

2010 Metals week average – $1.0483 - with the average discount of 22.5 cents equals a dollar volume of $4.9 billion

Scrap usage is estimated to be 43% of domestic aluminum usage

The value of scrap Things we cannot controlWhat a large buyer does and whyThe world of tradingHow things have changed

100,000 lbs molten prime

100,000 lbs molten 6063 scrap

A substitute for prime

Cash LME 2300 $1.043 Prime premium $0.082 Value of primary aluminum $1.125 Less discount ($0.030) Furnace recovery x 89 %

$0.9745 Less melting charge ($0.10)

$0.8745 Actual value is $0.1685 under cash Previous Buying Prices

earlier 2011 - $0.96 or $0.22 under cash average 2008 - $0.89 or $0.29 under cash

Buying prior to the mid 80’s Mid 80’s to present 2011 and forward

The LME----charts versus fundamentals Transparency Currencies World Happenings China/India Premiums Domestic economy

Automobile ProductionSubstitutionOthersFreight rates

Sales Inventory - raw goods – WIP - Finished goods –

purchased scrap Production schedule - maintenance Quality Metal flow - appointments Accounting Spreads - Bell curve

$2,650

$2,700

$2,750

$2,625

-$8

-$10

Emotions Entrepreneurs Buy/sell - versus what? Quality - upgrading Consolidations Timing Recycling Rate Internet Trading Derivatives - transfer the risk Follow the leader Anticipatory markets

5/1/11

$2,625$1.19-$8

Buying $1.11

$2,689$1.22-$8

Buying $1.14

5/1/12

COMPANY TYPECAPACITY INCREASE

(ktpy)BEGIN

PRODUCTIONMatalco (Canton, Ohio) Billet casting 35 mid 2010Accuride Corporation (Erie, Pennsylvania and Monterrey, Mexico) Aluminum Wheels na IVQ '11Elixir Industries (Mishawaka, Indiana) Extrusions na Early 2011Aleris (Richmond, Virgina) Rolling mill Partial restart Sep-10Nanshan America (Lafayette, Indiana) Extrusions na 2013Norsk Hydro (North Liberty, Indiana) Extrusions 3 2011Wakefield Extrusions (Pelham, New Hampshire) Miniature Extrusions 0.5 IIIQ 2011Apollo Global Management (Ravenswood, Virgina) Flat rolled products na IH 2011Skana Aluminum (Manitowok, Wisconsin) Aluminum Coils 2 million pounds/month 2011Superior Extrusions (Gwinn, Michigan) Extrusions 2 2011Bodine Aluminum (Troy, Missouri and Jackson, Tennessee) Castings na Late 2012International Extrusions (Garden City, Michigan) Extrusions na 2011American Aluminum Extrusions (Roscoe, Illionis) Extrusions na IVQ '11Sapa Extrusions North America (Portland, Oregon) Extrusions one press IIQ '11Cardinal Aluminum (Louisville, Kentucky) Extrusions one press 2012Aleris International (Morgantown, Kentucky) Secondary Aluminum Ingot na Late 2011Bermco Aluminum (Lincoln, Alabama) Aluminum Alloy 10 million lb/month IIQ '12Kaiser Aluminum (Kalamazoo,Mich) Rod, Bar and Tube na Early 2010Apex Aluminum Extrusions (Langley, British Columbia) Extrusions 600,000 pounds/month IQ '11

Information supplied by Harbor Intelligence

Four major types of aluminum companies scrap dealer toller broker consumer

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