Question-and-Answer Session
Operator
(Operator Instructions) Your first question is coming from David McGregor of Longbow Research
Luke Folta - Longbow Research
Well this is actually Luke Folta in for David McGregor, how are you today?
Dawne Hickton
Hi Luke.
Luke Folta - Longbow Research
Good. My first question I had revolves around overall margins. Could you talk about where you see margins going in a titanium group in ’08 with respect to where raw material prices are and where finished prices will be just regarding what’s going on with titanium scrap and how the F&D segments plays into that overall forecast?
Dawne Hickton
Sure. With respect to the raw material pricing as we’ve noted, generally we’ve got increasing overall raw materials costs going into ’08 although we are seeing some of the scrap market pricing coming down a little bit. And in terms of overall margins when we look at our gross margins to the Ti group we expect them for the year to look about the same as you'd see in 2008, or 2007.
Luke Folta - Longbow Research
Could you talk about the raw material market there for a second if you’re seeing any scrapping any activity for Ti scrap?
Dawne Hickton
Sure. Generally speaking you’re seeing kind of that market settling down as you’re generating more scrap in the industry. I don’t Mike if you want to comment on any additional trends?
Mike Wellham
Yeah. It’s obviously been declining over the past several quarters but I’ll classify it today as it’s probably stabilized.
Luke Folta - Longbow Research
Okay and if I could, just one more regarding the Airbus supply chain. Has rates been increasing there and could you give us more color on what you’re seeing overall there?
Dawne Hickton
In terms of our contract what we’re seeing on the Airbus supply chain this is the year that we’re ramping up on the contract that we signed in 2006 for the guaranteed memo of 5.2 million pounds so that’s what we’re going to be seeing in our numbers in terms of what they’re ordering. Longer term we’re seeing their needs continuing to grow and meet the demand they have for their new aircraft.
Luke Folta - Longbow Research
Okay thank you and good luck.
Operator
Thank you, your next question is coming from Nick Capuano of Imperial Capital.
Nick Capuano - Imperial Capital
Guys a couple of quick ones for you. Good quarter. First of all on the duty drawback program if you could speak to the range of impact you think it may have, I understand you’re going to be dealing with it on a cash basis, but what - I assume that all your guidance excludes the benefit of that, if you could you clarify that if that’s the case and also just talk about what you might expect in terms of the range of rebate you should get we might get from the program going forward over the next year.
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