Question-and-Answer Session
Operator
Thank you, sir. (Operator Instructions). We will take our first person from Mark Parr with KeyBanc.
Mark Parr – KeyBanc
Thanks, good morning.
Keith Busse
Good morning, Mark.
Mark Parr – KeyBanc
Keith, I had a question for you regarding the flat-rolled business, you had said you had seen a modest pickup in order, I guess in the last month or so. And if you think that's easing off of de-stocking at the service center level or is there, perhaps a pick up in automotive or some other end-market that might be affecting that?
Keith Busse
I think that it probably is a result of de-stocking getting their bottom in that arena, clearly if the operating rate or if the economy is moving forward at two-thirds of its former capability or 60% yet the mills are running sub-50 eventually there is going to be a change in the outlook and then change in order interactivity. However, modest it is, it is modest and I don't think we want to forecast, there is a major recovery underway, but there is an improvement and I think is probably has largely to do with de-stocking especially in flat-rolled. I don't know that we are at the bottom yet, in large structurals we may still be in a de-stocking arena there that going to cause operating rates in that universe to be rather dismal for another month or two.
Mark Parr – KeyBanc
And kind of along those lines, I think Gary had commented that as joist activity or coat activity was beginning to show some signs of life and part of that related to the I guess, the resumption of financing availability. Keith, how much of the slowdown in the structural side do you think is related to this financing or, lack of financing and is there a potential for that to, to perhaps shift a little bit as you move into the height of the construction season in the third quarter?
Richard Teets, Jr.
Well I think, this is Teets. And as Keith mentioned.
Mark Parr – KeyBanc
Hi Dick.
Richard Teets, Jr.
Good morning, Mark. Financing is an issue you talk to the fabricators and they do have backlogs or engineered projects but the owners are reluctant to pull the trigger on it either for financing and/or the true business return on it as you watch that vacancy rates in the inter-cities and so forth with the downturn occurring when, office complexes have 12% vacancy rates, nobody is going to really take, put their neck out and unless they already have a presold position and that's pretty tough these days. All I was going to say is that the structural to me the structural is almost like a trailing product it was the last to falloff because of project continuation the magnitude of projects that see through completion, and with vacancies and so forth I think it will be, potentially the last to pickup without some kind of artificial spark that through stimulus or some project like that.
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