COMMERCIAL METALS COMPANY 2015-2016 SUSTAINABILITY REPORT 19 MATERIAL RECOVERY MANAGEMENT Recycling and re-using our materials is good for the environment, but it is also good for our bottom line. We are constantly looking for new ways to make our processes more resource efficient and to optimize the use of products generated from the steelmaking process. Focusing our efforts on resource recovery and reuse allows us to reduce our operating costs and minimize our impact on the environment. For the past three years, 100 percent of our slag -- a sustainable product that is produced during the scrap melting process -- was captured for processing and re-use. Slag is used in various manufacturing and construction applications, such as a raw material in the manufacture of cement, aggregate in the production of concrete, and as an aggregate for road construction. We’ve also consistently captured a high percentage of baghouse dust, which is rich in zinc, for recycling – 98 percent in 2014, 2015 and 2016. For the past three years, the amount of recycled materials used in our manufactured finished steel has been over 95 percent. CONTRIBUTING TO THE DEVELOPMENT OF A CIRCULAR ECONOMY CMC’s business is inherently sustainable. We are vertically integrated and use recycled scrap metal in manufacturing and fabrication. Steel is durable, long-lasting, and can be re-used and remanufactured indefinitely. The re-use and remanufacturing of steel reduces the consumption of primary raw materials and therefore reduces many other environmental impacts associated with the sourcing of those raw materials. CMC recognizes our ability to contribute to resource conservation, and we are committed to continuously making our processes more efficient. Recycling in Seguin,Texas We strive to close the loop at CMC Steel Texas in Seguin. Our recycling operations use shredders to transform whole cars and other steel items e.g. appliances into fist-sized pieces of steel. Magnets are then used to separate ferrous metals from non- ferrous metals, plastics, dirt, glass, etc. Laser, Eddy Current, and optical separation systems are also used to efficiently separate materials like copper, aluminum and stainless steel that can be re-used in manufacturing or recycled into other products. We see all of these materials as valuable inputs to other products and continue to identify and apply new technologies and processes that help us recover as many materials as possible. One of the largest metal recyclers in North America, CMC recycled 5,959,152 tons of metal in 2015 and 5,741,881 tons in 2016. Percentage of Recycled Input Materials in Manufactured Finished Steel 95.6 95.6 95.6 2014 2015 2016