John J. Ferriola - Chief Executive Officer, President and Director James D. Frias - Chief Financial Officer, Executive Vice President and Treasurer R. Joseph Stratman - Executive Vice President of Beam & Plate Products Raymond S. Napolitan - Executive Vice President of Fabricated Construction Products James R. Darsey - Executive Vice President of Bar Products Keith B. Grass - Executive Vice President, Chief Executive Officer of DJJ and President of DJJ

Michelle Applebaum - Steel Market Intelligence Inc Luke Folta - Jefferies LLC, Research Division Sohail Tharani - Goldman Sachs Group Inc., Research Division Timna Tanners - BofA Merrill Lynch, Research Division Anthony B. Rizzuto - Cowen Securities LLC, Research Division Evan L. Kurtz - Morgan Stanley, Research Division Andrew Lane - Morningstar Inc., Research Division Aldo J. Mazzaferro - Macquarie Research Mark L. Parr - KeyBanc Capital Markets Inc., Research Division Matt Murphy - UBS Investment Bank, Research Division

Good day, everyone, and welcome to the Nucor Corporation Third Quarter of 2013 Earnings Conference Call. As a reminder, today's conference is being recorded. [Operator Instructions] Certain statements made during this conference call will be forward-looking statements that involve risks and uncertainties. The words we expect, believe, anticipate and variations of such words and similar expressions are intended to identify those forward-looking statements, which are based on management's current expectations and information that is currently available. Although Nucor believes they are based on reasonable assumptions, there can be no assurance that future events will not affect their accuracy. More information about the risks and uncertainties relating to these forward-looking statements may be found in Nucor's latest 10-K and subsequently filed 10-Qs, which are available on the SEC's and Nucor's website. The forward-looking statements made in this conference call speak only as of this date, and Nucor does not assume any obligation to update them, either as a result of new information, future events or otherwise. Now for opening remarks and introductions, I would like to turn the call over to Mr. John Ferriola, Chief Executive Officer and President of Nucor Corporation. Please go ahead, sir John J. Ferriola: Thank you, Keith. Good afternoon. This is John Ferriola, Nucor's Chief Executive Officer and President. Thank you for joining us for our conference call. As always, we appreciate your interest in Nucor. With me for today's call are other members of Nucor's senior leadership team: Dan Dimicco, Nucor's Executive Chairman; Jim Frias, our Chief Financial Officer; and our other Executive Vice Presidents, Jim Darsey, Keith Grass, Ladd Hall, Ray Napolitan and Joe Stratman. First and most importantly, we want to thank everyone on our teams at Nucor, Harris Steel, David J. Joseph, Duferdofin, NuMit, Steel Technologies and Skyline Steel for working safely, working hard and working together to ensure Nucor's success. The more than 22,000 men and women of the Nucor team are our company's greatest asset and our greatest competitive advantage. You are the right people doing the right things every day to build our company's long-term earnings power. Thank you all. Economic and steel market conditions remain challenging, but Nucor is in a position of strength in our industry, and we continue to grow stronger every day. Our team is primed and ready for the inevitable steel industry's cyclical upturn. I will now ask our CFO, Jim Frias, to review our third quarter results and financial position. Following Jim's remarks, I will provide an update on our many initiatives focused on profitable growth. Jim? James D. Frias: Thanks, John, and good afternoon. Nucor's third quarter 2013 earnings of $0.46 per diluted share increased from the second quarter of 2013 earnings of $0.27 per diluted share. Results for the just-completed quarter included a onetime charge of $0.03 per share for estimated costs associated with the storage dome collapse at Nucor Steel Louisiana. Third quarter performance also exceeded our guidance range of between $0.35 to $0.40 per diluted share. Our guidance was issued on September 17 prior to the dome collapse on September 25. The third quarter profit improvement was largely due to stronger performance in our sheet mills, as we were able to capitalize on opportunities resulting from competitor supply disruptions. Structural steel results also benefited from Nucor-Yamato's higher third quarter production rates following its planned 17-day outage in the second quarter. It is also worth noting that our downstream steel product segment, which includes joist and decking, rebar fabrications and pre-engineered metal buildings, has reported profits for 4 of the past 6 quarters. Nucor's fabricated products teams are delivering profitable performance in a very depressed nonresidential construction market. A comment about our tax rates, which can be confusing due to the impact of profits from noncontrolling interests. After adjusting all profits belonging to our business partners in the third quarter of 2013, the effective tax rate was 32.2%. During the quarter, we completed a capital raise that both lowered our cost of capital and lengthened our debt maturity profile. In late July, Nucor issued a total of $1 billion in debt, $500 million of 4% notes due in 2023 and $500 million of 5.2% notes due in 2043. This bond offering effectively refinanced $900 million of maturing debt that we retired in the fourth quarter of 2012 and in this year's second quarter. The weighted average coupon rate of the new debt is 35 basis points lower than the retired debt. We also lengthened our debt maturity profile. The new debt has a weighted average maturity term of 20 years versus less than 7 years for the retired debt. Our next significant debt maturity is not until 2017. Financial strength remains an important attribute of Nucor's business model. It is critical to our ability to invest through the cycle and grow stronger during downturns. Nucor is the only steel producer in North America to enjoy the extremely important competitive advantage of an investment grade credit rating. At the end of the third quarter, our total debt-to-capital ratio was 36%. Cash, short-term investments and restricted cash totaled over $1.7 billion. Further to Nucor's strong liquidity, our $1.5 billion unsecured revolving credit facility is undrawn. This facility was amended and restated following the debt offering with the maturity date extended almost 3 years to August of 2018. We have no commercial paper outstanding. In the current very difficult steel market conditions, Nucor's cash flow generation remains very healthy. Through the first 9 months of 2013, cash provided by operating activities was $884 million. 2013 capital expenditures are expected to exceed $1.1 billion. By the end of the current year, Nucor will have invested approximately $8 billion of capital since the steel market's last cyclical peak. Nearly $3 billion of that total is being invested in the 2012 to 2013 period. These more recent investments, both capital spending and acquisitions, largely consist of what we view as relatively low-risk and high-return projects focused on strategic objectives to lower our raw material cost and expand our product mix to include more value-added offerings. Lowering our raw material cost improves our competitive position and profitability throughout the economic cycle. Expanding our portfolio to include more value-added, higher-margin products does the same, as well as reducing the competitive pressure we face from imports. We will complete a number of these strategic projects over the balance of this year and into the first quarter -- or first half of 2014. For that reason, we expect somewhat lower capital expenditures next year. Spending at our steelmaking, raw materials and downstream products businesses should decline to closer to managed type levels. At the same time, our natural gas drilling expenditures will be at contractual levels, which we have previously disclosed totaling over $700 million for the 2 -- excuse me, $700 million for the 2-year period of 2014 and 2015. Nucor's natural gas investments are securing a long-term, low-cost supply of natural gas sufficient to cover our expected future steelmaking and DRI production needs for more than 20 years. The performance of wells drilled over the past 2 years has exceeded the projections we used to justify this capital allocation. That, of course, translates into lower-than-expected gas costs. We also expect our natural gas investments to be cash flow positive by late in 2016. For the fourth quarter, Nucor's earnings are expected to be moderately lower than the third quarter, as we typically experience lower shipments in this period due to seasonal factors. Additionally, we are planning extended production outages in this year's fourth quarter at several mills in preparation for previously announced capital expansion projects. These include our Berkeley County, South Carolina sheet mill's wide, light product expansion, our Nucor-Yamato structural mill's sheet-piling product expansion and our Norfolk, Nebraska bar mill's SBQ product expansion. Going forward, we see some encouraging signs in the marketplace. The Metals Service Center Institute September 2013 data released earlier this week reported both very lean inventories and improvement shipments at service centers. The Architectural Billing Index is in positive, indicating an expansion in billings in 12 of the past 13 months. In its most recent update, the American Institute of Architects stated that the trend points to an impending healthy upturn in nonresidential construction activity. We will again follow our practice of providing quantitative guidance in the final month of the quarter. John? John J. Ferriola: Thanks, Jim. 2013 represents the fifth consecutive year of a stagnant global economy and, in turn, extremely difficult steel market conditions. Two facts tell the story. First, the U.S. steel industry's capacity utilization rate remains mired well below 80%. Second, imports of steel into the United States are on pace to again exceed 30 million tons this year or approximately double the 2009 level. These conditions make no economic sense at all given the fact that American producers are among the lowest-cost producers of steel in the world. You have heard us say numerous times that the very serious problems depressing our economy and steel markets do have solutions. The American economy can be reinvigorated if our leaders simply allow us to seize the very significant opportunities open to our country today. These opportunities include an abundant and low-cost supply of energy, infrastructure rebuilding and a resurgent U.S. manufacturing sector. Importantly, they all offer the vital ingredient required for sustainable economic growth: jobs. More specific to the steel industry, policymakers must address the huge issue of global steel overcapacity. In China and other countries, there are large amounts of steelmaking capacity that is not globally cost efficient, but continues to dump steel into the global marketplace as a result of government subsidies. The Paris-based organization for economic cooperation and development this year estimated Chinese excess steel capacity alone is at least 300 million tons. As a result of the overcapacity, the current structure of the global steel industry is not sustainable. The discipline of the marketplace must be allowed to exert itself through free and rules-based trade. Why? That discipline rewards efficient producers with returns adequate to sustain their investments, providing value to the market in the form of product improvements and cost efficiencies. Equally important, the discipline of the marketplace punishes inefficient producers who destroys gas capital and other resources. Until the issue of excess capacity is effectively addressed, Nucor will continue to apply our teams can-do attitude and high energy level to the fight for effective and timely enforcement of our nation's trade laws. If not for illegally dumped and subsidized steel imports, we would have more production and jobs throughout both the steel industry and the overall American economy today. Evidenced by our participation in last month's trade case filed against rebar imports from Turkey and Mexico, Nucor stands ready to pursue appropriate legal action when our industry is harmed by violations of U.S. and international trade laws. Managing our business with a long-term perspective has been absolutely critical to the success of our company over the past 4-plus decades. Our long-term strategic focus has allowed us to adapt and expand our business model in response to market challenges and opportunities both operationally and commercially. With that longer-term view, we are bullish on the profitable growth opportunities for both the American economy and Nucor. As Jim mentioned, we will have invested approximately $8 billion of our shareholders' valuable capital from the last cyclical peak in the economy in 2008 through the end of 2013. These investments have dramatically expanded Nucor's long-term earnings power. Our more recent investments during this downturn are low risk and high return. Rather than just adding capacity to an oversupplied market, Nucor is reducing its raw material costs and expanding our product mix to include more value-added, higher-margin offerings. Today, our unrelenting focus remains on executing our strategic plan and converting our $8 billion of investments into higher highs in profitability once the next cyclical upturn inevitably arrives. I will now update you on the progress achieved by our team this quarter in executing our growth strategy. Construction is nearing completion on our 2.5 million metric ton annual capacity, direct reduced iron or DRI facility in Louisiana. However, startup of the plant has been delayed by about 3 months until the end of the year. As we reported in late September, a storage dome collapsed at the site. Most importantly, there were no injuries and no environmental impact. The storage dome was 1 of 3 domes built to store iron ore. We are certainly disappointed by this event. However, I emphasize 2 very important points. First, this is not an issue whatsoever with the process technology we are using to produce DRI. Our team in Louisiana is continuing with hot commissioning of the plant. Second, we are addressing the problem and expect to start production by the end of the current quarter. Startup of our Louisiana DRI plant will be a huge step forward in the implementation of our raw material strategy. Combining Louisiana's 2.5 million tons capacity with the 2 million tons annual capacity of our existing Trinidad DRI plant will bring us to 2/3 of our long-term goal of controlling 6 million to 7 million tons of annual capacity in high-quality scrap substitutes. We expect our expanded DRI capacity pad with our long-term and low-cost natural gas supply, to be a game changer for Nucor's cost structure for the high-quality iron units we need to compete in higher-value-added sheet, SBQ and plate product markets. In September, our South Carolina bar mill successfully started production on its new rod block. The rod block, along with earlier 2013 investments in a coil line and roughing mill stands, will allow Nucor Steel South Carolina to produce approximately 450,000 tons per year of rod and bar in coil products. Our team is very excited to have the opportunity to grow our participation in the attractive and underserved wire rod market in the Southeastern U.S. region. We have already received excellent customer feedback regarding the surface quality, dimensional tolerances and physical properties of our initial output. I discussed on our July conference call the successful June startup of production on our Hertford County, North Carolina plate mills new normalizing line. Today, I am very pleased to report that the normalizing line is already running at full capacity. Our 120,000 ton per year capacity normalizing line serves attractive end-use markets, such as energy, transportation, shipbuilding and armor plate. Complementing our recent investments in a heat treat facility and a vacuum tank degasser, Hertford County's value-added plate products annual capacity has now doubled to 240,000 tons. Steel Technologies' new facility in Monterrey is now fully operational. A new flat-rolled steel processing and pickling operation has an annual processing capacity in excess of 800,000 tons and offers light gauge slitting, heavy gauge slitting, blanking, cut to length and Eco Pickled Surface, EPS, pickling. Our team in Monterrey is very pleased to be running the North American market's largest capacity EPS pickling line, an effective and environmentally friendly technology, which offers significant advantages over traditional acid pickling. Customer reaction to the quality of the product they have received has been extremely positive. This premier processing operation represents a $67 million strategic investment for Steel Technologies in the growing Mexican market. Our next major project to start up will be the Berkeley County, South Carolina sheet mill's wide, light project, which is scheduled for the first quarter of 2014. This investment involves an upgrade and modernization of equipment from the top of the caster through the reversing mills. It will provide Berkeley the capability to produce wider and lighter gauged sheet steel. Berkeley's new product offerings will include 72-inch wide hot rolled, 72-inch wide hot rolled, pickled and oiled, 72-inch wide cold rolled and gauges as thin as 0.042 inch. These expanded capabilities will provide profitable opportunities to move up the value chain in agricultural, pipe and tube, industrial equipment, heavy truck and automotive high-strength and ultra-high-strength applications. Customers are already inquiring about placing orders for these new products soon to enter production. There is no question that steel market conditions remain frustratingly challenging. Nevertheless, these are exciting times for Nucor, as our company grows stronger and stronger. A stronger Nucor is one that is continually improving its capability to take care of all of our customers, the people who buy and use our products, our teammates and our shareholders. In closing, I want to again thank everyone on the Nucor team for working safely, working hard and working together to build a stronger Nucor. Thank you, and please keep it going. We would now be happy to take your questions.

[Operator Instructions] And we'll take our first question from the line of Michelle Applebaum. Michelle Applebaum - Steel Market Intelligence Inc: I have 3 but I only get 2, right? John J. Ferriola: We'll start with 2 and maybe you can come back later in the call. Michelle Applebaum - Steel Market Intelligence Inc: Yes, yes, yes. So right now, I think something people are talking about -- a macro question. The sheet industry appears to be changing the approach on how you quote contracts, and there has been a lot of controversy over the CRU minus kind of discount with CRU sort of being the standard, I guess, index. Can you talk about, one, what impact it's going to have on the sheet business next year? Two, how are the contracts coming for next year? And three, what percentage you would like to have under contract for the coming year? That's still kind of one question. It is. John J. Ferriola: It is. Okay, we'll handle it as one question. Well, I will speak for Nucor. I won't speak for the rest of the industry in terms of contract pricing. But as we talk about the CRU and the CRU minus, we at Nucor have recognized that the returns that have been generated by that pricing mechanism were not compensating us for the quality, the service, the on-time delivery that we provide to our customers every day. So we felt that it was necessary to change that, and we're in the process of changing it as we speak to our customers today. As far as how is it being received, well, certainly it's a little challenging, but our customers overall understand the need to have a pricing mechanism in place that allows for a sustainable, long-term company. So it's been a little bit challenging, but it's being received as we move along. Today, our contracts are going a little slower than normal, but we are making progress, and our customers seem to be accepting the concept of needing a change. In terms of what percent that we would be shooting for in 2014, as always, it kind of depends on where we end up with the pricing and what the contracts look like. Typically, we like a mix that's somewhere between 40% to 60% contract and with the rest remaining in spot. There's times when spot can really serve us well. For example in the last quarter, our ability to take advantage of some of these supply disruptions that occurred in the sheet market resulted in a very good quarter for us. And I want to thank our commercial team for being on top of that and taking advantage of that opportunity and doing very, very well in capitalizing upon it. So we would be looking for somewhere maybe around 50%, Michelle, but we'll go 10% or 15% either side of 50% depending upon what the contracts look like. Michelle Applebaum - Steel Market Intelligence Inc: You didn't say what you were replacing the CRU with? Are you just doing it on the price basis entirely? John J. Ferriola: Well, you're absolutely correct. We did not say it, okay. And that is something that we discuss with our customers, and I'm not going to get into it here other than to say that we are moving away from a CRU minus pricing mechanism or, for that matter, any index-based minus pricing mechanism. Michelle Applebaum - Steel Market Intelligence Inc: Okay. Well, I wasn't a fan of that, so I'd say here, here, it's a good choice, and I hope the market supports it. My second question is, so recently, we saw the closure of the -- I think, it's 0.5 million ton a year EVRAZ Claymont, Delaware plate mill. Is that a facility that overlaps with your product mix? And what kind of impact do you think it'll have on you? And do you think it could potentially be a consolidation target for you? Again, one question. John J. Ferriola: You're getting better and better at this, Michelle. Michelle Applebaum - Steel Market Intelligence Inc: Well, trained. John J. Ferriola: Well, let me make a couple of comments about the closing at Claymont in terms of how it will impact our business. Clearly, they are a -- they tend to provide a thicker product to the market. We go from 1 to 2 inch. 2 inch is our maximum thickness that we can offer the market. That being said, -- excuse me, 3 inches, what we can offer the market. That being said, there are some overlaps on the grades that we produce, and we have seen an incremental pickup in inquiries and order entry as result of them closing. Obviously, there's -- we serve a similar geographical territory. I would also take the opportunity to give a plug to our plate mills. Hertford County, which serves a similar area, has the additional benefit of offering normalized and heat-treated product as we mentioned. Michelle Applebaum - Steel Market Intelligence Inc: I think you've mentioned that. John J. Ferriola: Yes. I mean, I'm probably going to mention it a few more times before the call is over because we're really proud of that fact, and it has been very, very instrumental in supporting our other plate business. It gives us the ability to compete in markets with those other competitors who can offer similar products. So it's really expanded the grades that we can offer to the marketplace.

And we'll go next to the line of Luke Folta. Luke Folta - Jefferies LLC, Research Division: My question I -- in just looking at this whole Gulf Coast chemicals expansion that we're seeing, we're starting to see some pretty major stuff move forward. If you look -- I mean, it's estimated over the next few years that we could see something like $50 billion plus of spending on ethylene plants and other chemical-type jobs, and you've got LNG export terminal layered in on top of that. I guess, when I look at those numbers, they'll seem like pretty massive numbers to me, and all that stuff's made -- it's very steel intensive. And I'm just -- I guess, my question is, is there any way you can help us connect the dots in terms of that level of spending? What could that mean for Nucor in terms of your addressable market? Are you selling the right products to the -- that would go into this stuff? Anything that could help connect those dots would be very helpful. John J. Ferriola: Well, you've heard us mention several times over the last several years of our participation in the energy-based markets. That was a target we had several years ago. We recognized that there was going to be an improvement in the energy market, and we decided probably about 5 or 7 years ago to be a very active participant in that market. And towards that end, we've worked hard to develop new grades that serve the energy market well, and we've grown tremendously in that market. Today, along with automotive, energy, as you know, energy and automotive are 2 of the strong markets out there today, and we have a very strong participation in both. As far as energy goes, I would say that in addition to having gone over the last 5 to 7 years to improve our participation, we continue to develop new grades on our plate business to better serve that market and get a larger participation in that market. Joe, anything in particular you would like to add in terms of grades that we're working on? R. Joseph Stratman: We have the degassing project, as well as the heat normalizing in the Q&T heat-free [ph] line, have been focused on high-strength steels for construction industry and very heavily focused on the energy sector where our steels now can go into the offshore oil platforms, as well as the heavy tank industry, for tank farms for holding oils and gases, as well as the construction of those plants. So that has been a targeted focus of some of the upgrades that we have made at the Hertford plant. And it's shown very good progress and good orders already. So we're looking forward to those of days, Luke, when all that comes online. John J. Ferriola: Joe, I would just add to that, that we, Nucor, are the supplier of choice for tubulars because of our outstanding gauge control. Our gauge control was second to none, and that's important to the tubers. So we have a very strong participation in that market also. And when you think about our -- the location of our facilities, we're able to serve them very well with barge delivery and with rail. Luke Folta - Jefferies LLC, Research Division: Okay. And I guess the sales into those kind of mega-type projects, do they tend to happen more through direct -- big direct contracts in that sense? Or is that something that you just kind of -- it flows down through distribution and some of the component manufacturers and things like that? How do we -- how should we expect that to flow through? John J. Ferriola: Well, actually, both. It flows both ways. Obviously, a lot goes through our service centers. But we also have a team that focuses specifically on the energy market in terms of large projects, in terms of the construction of the projects, in terms of construction of the pipelines carrying the energy products. So it's really both ways, Luke. We have a team focused on direct sales, and we obviously sell a lot into that through our service centers.

And we'll go next to the line of Sohail Tharani. Sohail Tharani - Goldman Sachs Group Inc., Research Division: John, I think you mentioned that natural gas investments, $700 million. Is it 2014 and '15 combined? Or is it each year, $700 million? John J. Ferriola: That was a combined number. Sohail Tharani - Goldman Sachs Group Inc., Research Division: Okay. I just want to understand, this is -- this will be enough gas for running 2 DRI plus all the gas you use. What is your -- how are you thinking in terms of the second year at plant? And if it gets delayed, will you be able to reduce the investment or the amount of gas you extract or you will be able to sell it into the open market? John J. Ferriola: Well, let me start by making a couple of comments. First of all, at the peak of our gas drilling operations, we would be able to deliver enough gas for 2 of our DRI facilities. All of our steel mills would still have surplus gas. Secondly, you mentioned about the start of construction on the second DRI facility. I mentioned during the last call that we will be addressing that. We want to get the first one up and running. And then we will take a look at what we want to do with the second facility. I can tell you there's been an awful lot of interest in the marketplace on purchasing DRI from us and having a facility that would run on a merchant basis. But one thing I do want to stress right away, the way that you asked the questions kind of implied that we might delay the decision of the second DRI plant based upon events that were taking place today in Louisiana with the dome. And that is absolutely, categorically not the case. It has nothing to do with it. This is a short-term issue with the dome. We're already well into a work-around to get around the issue. This has nothing to do with the technology. It's simply an issue with the raw material transportation. And I think I mentioned on the last conference call that this is extremely complex because of the size of it. The material handling is an extremely complex system, and we actually expected a few hiccups. Now this is a bigger road bump than we were hoping for, but in typical Nucor way, we're facing it head-on and we're resolving it. So there's no impact on long-term -- on long-term strategy relative to DRI as a result of the dome. Sohail Tharani - Goldman Sachs Group Inc., Research Division: And I certainly didn't imply that -- regarding about the dome. I understand the dome is just a storage facility that has nothing to do with your process and project. The second question is that if I look at your joist and deck volume versus the fabricated product volume for fabricated concrete reinforced steel volume, they're sort of diverging from each other. The joist and deck is up 10% to 12% to 14% and the rebar fabricated products is down 11%. I just want to understand, are these catering to different markets or is there something else going on over here? John J. Ferriola: Ray, why don't you field that one? Raymond S. Napolitan: Yes, sure, John. Well, the rebar fabrication market and the joist and deck market do cater to somewhat different markets. And I would say that there are just some different dynamic markets involved. And as we mentioned the last quarter, the weather still continues to impact rebar fabrication shipments just a little bit as they did the first 2 quarters of the year. Sohail Tharani - Goldman Sachs Group Inc., Research Division: Does it have to do -- anything to do with the private construction and public construction? Or that's not the case? John J. Ferriola: He asked the question about is it tied to private versus public construction. Raymond S. Napolitan: Well, the answer is yes, there is some tied to -- there is more tied to public construction on the rebar fabrication side. And joist and deck tends to be more towards private construction, yes, sir. John J. Ferriola: One more comment that I'd like to make since you're asking about rebars. I kind of alluded to it in the prepared comments. But the imports of rebar over the last quarter have been a major issue for our company and for our country. And that has impacted our business on the rebar side also. I would point out and maybe just reinforce what Jim said during his comments, kudos to the entire product team. Despite the challenging nonresidential construction market that we've lived through, they have been profitable 5 out of the last 6 quarters. And when I talk about being excited about Nucor's future and I think about the fact that nonresidential construction is at its lowest point in 30 to 40 years and despite that, our teams have found a way to remain profitable 5 out of the last 6 quarters, I get very excited about what we will be doing when the nonresidential construction market inevitably returns.

And we'll take our next question from Timna Tanners. Timna Tanners - BofA Merrill Lynch, Research Division: I was happy to hear some more detail on the different projects. Some of the other steel mills have been talking quite detailed. They're giving a lot of detail, I guess, on their cost savings or their initiatives, benefits or payback times. So this is a step in that direction. But I guess can you talk a little bit more about how we might think about the contribution of some of these into next year? How do we quantify like the incremental benefit, whether it be cost or prices or volume? James D. Frias: Well, Timna, typically, when we announce projects, we give a capital budget. And I think you have a feel for what type of hurdle rates we think about. We typically don't break out details of the returns of each project. But I think you can make a rational estimation based on the cost of the projects themselves. John J. Ferriola: And Timna, I would ask you to think about the fact that in addition, as you mentioned, all projects involve both cost mitigation and the offering of new products to the marketplace. So it's really, in many cases, we have projects going on that will give us a double benefit. So as Jim said, we do have a certain hurdle rate, and in some of our projects that we're working today and that we mentioned earlier today, we will see the benefit from both sides of that equation. Timna Tanners - BofA Merrill Lynch, Research Division: Into 2014, it sound like then we'll start to see some of that? John J. Ferriola: Yes. As we said, in Berkeley, a wide light project will start in the first quarter. The NYS projects will start sometime around mid of next year, offering the 3 new piling sections for the market. That's a really exciting project. So we see a lot of them coming to fruition in the early part of 2014. Timna Tanners - BofA Merrill Lynch, Research Division: Okay, cool. My question, I guess, the next one that would be, the second one, is really to delve a little bit further into this idea of value-add and the investments you've made, whether it be vacuum degassers or the wide light project. And it's a question on the auto industry. And we've written something about maybe the tables turning even a little bit toward the steelmakers this next year. And I know Nucor has been moving toward supplying more auto, and I just wondered if you can give us an update to the extent possible on your progress there? John J. Ferriola: Well, we continue to make progress there and offering the next generation of advanced high-strength steels. We're committed to working with our automotive customers to provide a great product. We recognize the challenge they're facing as a result of the CAFE requirements that will be coming into effect probably in 2018 and fully in 2025. So we've been working, and I've mentioned a few times, the high-strength and ultra high-strength product that we've been developing. They are in the marketplace today, and they're doing very, very well. I would also say that without giving any specifics as to the customers or the contracts that we're working under, we have ongoing automotive exposed steel trials as we speak, and we are quite optimistic about the outcome of those trials.

And we'll take our next question from Tony Rizzuto. Anthony B. Rizzuto - Cowen Securities LLC, Research Division: With all of the exciting investments you've got on the come, can you guys quantify the start-up costs that we're likely going to see in the fourth quarter and into 2014? Can you talk about that a little bit? And I've got one more question, too. James D. Frias: Yes, I'll take that. In the second quarter, our pre-operating start-up costs were around $6 million. In the third quarter, they were in the neighborhood of $11 million, and we're forecasting the fourth quarter to be just over $13 million. We would expect that they would probably level off in the first quarter and maybe even fall off a bit with the DRI plant coming fully on-stream and then decline from there. Anthony B. Rizzuto - Cowen Securities LLC, Research Division: Okay. So first quarter . . . James D. Frias: There's probably going to be some incremental pre-operating start-up costs with the wide light project and the beam project as well. But they will be short term. They won't be long-term periods. So last for maybe a quarter each as they go through the start-ups. Anthony B. Rizzuto - Cowen Securities LLC, Research Division: All right, great. And then also, your performance turned out to be much better than you guys guided in the middle of September. And I was wondering, was there a major area of variance or was there an acceleration of demand? I was wondering if you could maybe elaborate on that a little bit. John J. Ferriola: Well, we did see some incremental demand improvement in the sheet market, but it was incremental. Really what we saw was more of an issue of disruption in the supply. And as I mentioned earlier, our commercial team just did an outstanding job of capitalizing on that opportunity and most of the improvement that you see is a result of our improvement on the sheet side of the business during the quarter. James D. Frias: And Tony, I would just say that our divisions helped us come up with our forecast. And our sheet mills were probably a little conservative in their forecast for September, and they came in a little better than they thought they would. And that was the biggest driver. Anthony B. Rizzuto - Cowen Securities LLC, Research Division: When you guys look -- you mentioned about the investment with wider width at Berkeley. Is that going to be going towards the automotive industry in terms of the ultralight gauges? Or was -- I heard other markets being mentioned. I don't know if I heard automotive there. John J. Ferriola: No, it will be going to several markets. We kind of ran through them. It will be certainly automotive, agricultural, heavy truck, industrial applications, white goods would be just some other ones that I would mention. Anthony B. Rizzuto - Cowen Securities LLC, Research Division: All right. I kind of slipped that third question there. I appreciate it. John J. Ferriola: That's okay. The key thing to note on that is that the items that we kind of ran off there, all involve high-strength or ultra high-strength applications, which is critical, and that's one of the key things we're focusing on out of Berkeley and our other sheet mills. James D. Frias: I mean, let me add just a couple more. [indiscernible] allows us to give more [indiscernible] out of a coil. So they have a lot of our customers. And secondly, we're able to go to a lot lighter hot band than we've ever been able to go to before. So there's a lot of applications in that lighter hot band that we'll be able to facilitate more so than we ever have.

And we'll take our next question from Evan Kurtz. Evan L. Kurtz - Morgan Stanley, Research Division: Just a question on the potential for SBQ consolidation. I know you guys have been kind of pushing over the past few years here to move into higher and more premium applications for SBQ. I know there's a bunch of assets that are kind of being stripped out of a competitor of yours over the next year here that are already towards the very high end. There are 6 kind of major producers out there. Do you see any sort of potential? Is that something that you're interested in? John J. Ferriola: Well, as always, we're not going to make any direct comments other than to say that we are always opportunistic. If we see the right opportunity at the right price, we'll move on it. And you're right, we have been focusing in our SBQ business on higher and higher valued opportunity -- applications. On Nebraska, we've been focusing on automotive with primary axle, camshafts, gearing, suspension and steering components. In Memphis, crankshafts, hubs, several other products. Bottom line is when you look at our SBQ products, we recognize that there is some consolidation occurring but there's also some new SBQ competition coming online. And that's why our team are focused on moving up and up on the value chain. Jim, is there anything that you'd want to add to that? James R. Darsey: I'd just add that the investments that we've been making are geared primarily toward improving our quality of the project that we're doing in Nebraska as we speak, is installing a new hot sheer, cold sheer, packaging material and quality instrumentation that allows us to move up the value chain and produce higher-quality products. While we're doing these projects, we are also doing a number of trials with a number of Tier 1 and Tier 2 automotive suppliers to get qualified to produce automotive-grade material. And as we go through these qualifications, we're setting ourselves up to participate more in the automotive industry going forward. Evan L. Kurtz - Morgan Stanley, Research Division: Got you. And maybe just one on rebar. The trade case has kind of been out there for a month or so for now. I know there is a tiny price increase that was announced, mostly just to keep up with the scrap, it seems like. But are you noticing any sort of change in behavior from buyers on the rebar side? Or do you feel like we're getting close to some sort of inflection here? John J. Ferriola: I don't think we've noticed a major change in the buying habits of the customers. Obviously, whenever we begin trade action, the countries that are importing the product get nervous. We see a slight reduction in the amount of imports coming in. But other than that, there's been no major change in the buying habits.

And we'll take our next question from Andrew Lane. Andrew Lane - Morningstar Inc., Research Division: I have 2 DRI-related questions. First, it seems as though your increased DRI production will allow you greater flexibility with regard to the basket of feedstocks you can apply to your furnaces. It will also allow you to take advantage of arbitrage opportunities associated with feedstock costs when DRI, pig iron and high-grade scrap prices change relative to each other. Once you're first Louisiana DRI facility is online, how different will your average feedstock basket look relative to its current composition? John J. Ferriola: Well, it certainly will include more DRI. You answered the question very well yourself in asking the question. What it really does is give us a tremendous amount of flexibility. So every month, we'll go out and we'll take a look at the various commodities. We'll look at where we are with DRI. We'll look at the HBI pricing. We'll look at pig iron pricing. We'll look at prime scrap, obsolete scrap. And based upon that, we will adjust the basket, as you call it, the basket or the recipe, we would refer to it as, on almost a monthly basis and do what gives us the best cost advantage each month. Andrew Lane - Morningstar Inc., Research Division: Okay, that's great. And then secondly, given DRI's high iron content that can be used as a supplement to lower-grade scrap or a replacement for higher-grade scrap in the melt, how will your increased DRI production impact the quantity of scrap and the quality of scrap you purchase? And will it allow you to generate cost savings by making purchases further down the quality spectrum with regard to scrap as you apply more DRI? John J. Ferriola: Obviously, as we use more DRI, we can reduce the amount of prime scrap that we use in the mix. But again, we'll take a look at that on a basket-by-basket case and make the right decisions predicated upon the pricing of the various commodities. But as a general statement, yes, we've invested a lot in our DRI facility. And we've invested in our steel mills and their ability to better feed DRI into the furnaces, do it more effectively, do it quicker. So we will be using a lot of DRI as we move forward.

And we'll take our next question from Aldo Mazzaferro. Aldo J. Mazzaferro - Macquarie Research: I had a question on the capital spending budget maybe for Jim here. Over the last calls or 1 or 2 calls, you've sometimes said that you might push your CapEx down to -- closer to the sustaining and maintenance level, and I think you said the same today. Once on a call, you estimated that out of your $1.1 billion, only about 20% was actually sustaining capital. So I guess my question is, where does that sustaining capital number lie? Is it somewhere between your depreciation and maybe the $200 million? Or is it -- would it be likely to be under depreciation? James D. Frias: So this question on the amount that we would view as sustainable is probably as well addressed to John as I. But I would say it's in the $300 million to $400 million per year range. John? John J. Ferriola: I would agree with that. We don't use a hard and fast formula compared to depreciation. We take a look at where we are in the cycle of maintenance and make a decision that's best to keep our facilities in perfect operating condition and be able to provide a great quality product to our customers. James D. Frias: So Aldo, if we think about 2014, and certainly to say a final number, that we'll have that baseload number of $300 million to $400 million. We'll have some carryover on the finishing thin and wide and some of the other big projects that are underway. And then we'll have the gas investment, a significant portion of that $700 million over 2 years that we'll be spending. So it will probably approach $1 billion, but be below $1 billion, would be my thinking right now. But again, we'll go to our Board of Directors in December with a final budget, and then we'll come back in January for that conference call, and we'll give you our budget target for 2014 at that time. Aldo J. Mazzaferro - Macquarie Research: Great. So that gas spending is kind of front-end loaded a little bit then, too? James D. Frias: Yes, in a sense, that's how we almost think about it, is we're prepaying for gas by paying the drilling costs of getting access to it in the ground. And when we had an earlier question about all of the evolution of the chemical industry that's coming in the Gulf Coast area, that's another factor that we think about. And we also think there is a big trend of power plants using gas. It's hard to predict what future gas prices are going to be, but they do have the potential to go back up into a $6 or $7 range. And we'll have a very, very nice competitive advantage with our locked-in cost of gas for a number of decades. Aldo J. Mazzaferro - Macquarie Research: And just a very quick second question. Can you say how long and what the capital cost might be for the DRI in second investment and how long the construction phase would be and what you might spend on that? John J. Ferriola: Well, as we've mentioned several times, we've invested the infrastructure that we have as part of the project. The first DRI will also cover the second DRI facility. So the investment would be somewhat less. So we would probably put it in the neighborhood of about $550 million to $600 million, just as an estimate. We haven't really begun work on that at this time. And the construction time would be a little bit less, not significantly less. Obviously, the furnace is the big item being installed, and that would, of course, be about the same length of time. So it might a little bit shorter, and it will be a little bit less expensive.

And we'll take our next question from Mark Parr. Mark L. Parr - KeyBanc Capital Markets Inc., Research Division: I was just curious if you could give a little more color on the natural gas drilling activity. How many wells do you expect to complete this year? And also, you've talked about cost coming, being a positive surprise. Any color around that would be helpful. And then lastly, if you could just give us an update on the plan to monetize some of the midstream assets and would be curious in terms of timing on that. John J. Ferriola: Well, let's start with the number of wells that we are currently drilling. Keith, you want to take that, please? Keith B. Grass: Yes. We're in the range of 200 wells right now, and we'll probably finish up the year somewhere in the range of 240, 250, somewhere in that range in terms of actual number of wells. And I'm not sure -- I can't remember exactly what the next question was. John J. Ferriola: Yes, the second question was the timing on the midstream that we've mentioned in the past, that it's possible that we would end up flipping the midstream assets. And I think that timeframe was... Keith B. Grass: Yes, [indiscernible] time, and it's probably in the 2016, 2017 time period. I would say... James D. Frias: I would answer this. We're on track with the original plan and the layout for that midstream, those assets to build out, and that was the general time frame I think we indicated early on, and we have really no significant barriers from that right now. Mark L. Parr - KeyBanc Capital Markets Inc., Research Division: I guess just the other thought was just to try to get some more color around the cost that you're -- the cost of completion or the underlying cost of the actual operating wells in terms of Mcf or however you'd like to give additional color on that. Keith B. Grass: We still view that as confidential. And as I mentioned, I've mentioned a number of times in some of the venues I've been in, there will be a point in time where we have enough volume that we have to make full SEC disclosures like an E&P company, and then you'll see all that detail. But until that time, we'd like to keep that to ourselves. We think it's valuable information. John J. Ferriola: What we mentioned during the script was that the wells, the gas that we are getting out of the wells, the rate that we were being able to drill and get gas out of the wells is greater than what put into the initial performance. Keith B. Grass: And I've said that it's worth noting that year to date, it's having a small positive impact on our income statement. So our costs have been below the market price on average so far this year.

And we'll go next to the line of Matthew Murphy. Matt Murphy - UBS Investment Bank, Research Division: Just a question on DRI. Does the delay with the storage dome -- you talked about you're still hot commissioning the process. Does that add some confidence on how quick you can ramp it up since you've got a bit more time with the process side? John J. Ferriola: It does. We will have more time to do a more thorough process, hot commissioning. So yes, I would say that it will reduce the overall startup time. The DRI process, as a general statement, however, is kind of an on-off thing. It starts up and it runs or it doesn't start up. So we're highly confident that when we're ready to start at the end of the year, we overcome this issue with material handling, we will have a relatively quick startup. Matt Murphy - UBS Investment Bank, Research Division: And I guess just on the purchasing for inputs next year, do you have to commit to any pig supply to make sure you've got it if there are any hiccups? Or how short order can you get material if you need it? John J. Ferriola: We have everything laid out. We have 4 good suppliers, all of which are proven suppliers. We see no problems at all with the supply of raw materials. James D. Frias: And we don't feel like we're going to have to take material and store it some place because of this issue. We think we're fine in that regard.

And we'll take a quick follow-up from Michelle Applebaum. Michelle Applebaum - Steel Market Intelligence Inc: Can you remind me, what live permits do you have going at your Louisiana site, what kind of facilities are you currently permitted to build and when do these permits run out? John J. Ferriola: Let's see. We -- you want to take that one? Raymond S. Napolitan: Yes. Right now, we're permitted to build 2 DRI plants. We're not worried. We started on them. On the second DRI plant, I can't remember the exact -- but it's a matter of many months from now -- [indiscernible] to say whether we're going to start that permit will still be valid. Michelle Applebaum - Steel Market Intelligence Inc: So you're not permitted to build a steel mill anymore or are you? John J. Ferriola: We have a permit that's still in place for a blast furnace operation with a coke ovens at that facility. We've never had a permit for a steel mill. Michelle Applebaum - Steel Market Intelligence Inc: Sorry, I misspoke. Okay, and how long does it [Audio Gap] John J. Ferriola: I think she dropped accidentally, but I'm guessing she's going to ask, how long does the blast furnace permit stay live? Raymond S. Napolitan: We're not going to get into specifics, Michelle, if that's what you're asking. I'm not sure if you're still on the line. But we won't get into specifics of the length of time of the blast furnace permit.

And we'll take our last question from Sohail Tharani. Sohail Tharani - Goldman Sachs Group Inc., Research Division: Jim, at this time, you are reporting an earning in the equity in the consolidated affiliates. Is that from the Italian operation? James D. Frias: It's a net [ph] of a couple of operations that are in there. But a big part of it is NuMit and the performance in our joint venture with Mitsui. This chip [ph] technology business has shown continual improvement, and it's gotten to be big enough that it's offset the losses we were experiencing in our Italian operations.

And it appears we have no further questions in queue at this time. I'll now turn the program back over to our presenters for any closing remarks. John J. Ferriola: Thank you, Keith. Let me close by again by saying thank you. Thank you all on the call for your interest in Nucor. Thank you for our shareholders for your continued support. Thank you to our customers for your business. And mostly -- most importantly, thank you to our teammates for what you do every day, and thank you for doing it safely. Have a great day. Thanks for your interest in Nucor.

This concludes today's program. We thank you for your participation. You may now disconnect at any time.