<PAGE>

                                                                           1996
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                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549

                                   FORM 10-K

(MARK ONE)

  [X]            ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D)
                    OF THE SECURITIES EXCHANGE ACT OF 1934

                  For the fiscal year ended December 31, 1996
                                      OR
  [_]      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                        SECURITIES EXCHANGE ACT OF 1934
                      For the Transition period from to

                          COMMISSION FILE NO. 1-9117

                         INLAND STEEL INDUSTRIES, INC.
            (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

                                                     36-3425828
               DELAWARE                 (I.R.S. EMPLOYER IDENTIFICATION NO.)
       (STATE OF INCORPORATION)

    30 WEST MONROE STREET, CHICAGO,                     60603
               ILLINOIS
    (ADDRESS OF PRINCIPAL EXECUTIVE                  (ZIP CODE)
               OFFICES)

      REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (312) 346-0300

          SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:

<TABLE>
<CAPTION>
                                                                  NAME OF EACH EXCHANGE
                 TITLE OF EACH CLASS                               ON WHICH REGISTERED
                 -------------------                              ---------------------
     <S>                                          <C>
     Common Stock ($1.00 par value), including                New York Stock Exchange, Inc.
      Preferred Stock Purchase Rights
     Series A $2.40 Cumulative Convertible                Chicago Stock Exchange, Incorporated
      Preferred Stock ($1.00 par value)
</TABLE>

          SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:

                                     NONE

  Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days. Yes [X]  No [_]

  Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [_]

  As of March 12, 1997 the aggregate market value of the voting stock of the
registrant held by non-affiliates of the registrant was approximately
$992,500,000.(/1/)

  The number of shares of Common Stock ($1.00 par value) of the registrant
outstanding as of March 12, 1997 was 48,907,952.

(1) Excluding stock held by directors and executive officers of registrant,
    without admission of affiliate status of such individuals for any other
    purpose; also, excluding Series E ESOP Convertible Preferred Stock of the
    registrant, which Series is not publicly traded.

                      DOCUMENTS INCORPORATED BY REFERENCE

  Parts I and II of this Report on Form 10-K incorporate by reference certain
information from the Annual Report to Stockholders for the fiscal year ended
December 31, 1996. Part III of this Report on Form 10-K incorporates by
reference certain information from the Company's definitive Proxy Statement
which will be furnished to stockholders in connection with the Annual Meeting
of Stockholders of the Company scheduled to be held on May 28, 1997.

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<PAGE>

                                    PART I

ITEM 1. BUSINESS.

  Inland Steel Industries, Inc. (the "Company"), a Delaware corporation, is
the sole stockholder of Inland Steel Company and the holder of stock
representing approximately 87% of the economic interest in Ryerson Tull, Inc.
("RT"). Inland Steel Company is an integrated domestic steel company that
produces and sells a wide range of steels, of which approximately 99% consists
of carbon and high-strength low-alloy steel grades. It is also a participant
in certain iron ore production and steel-finishing joint ventures. RT is the
sole stockholder of Joseph T. Ryerson & Son, Inc. ("Ryerson") and J. M. Tull
Metals Company, Inc. ("Tull"). Ryerson and Tull are leading steel service,
distribution and materials processing organizations.

BUSINESS SEGMENTS

  The business segments of the Company and its subsidiaries are Steel
Manufacturing (including iron ore operations) and Materials Distribution. For
the three years ended December 31, 1996, information relating to net sales,
operating profit, identifiable assets, depreciation and capital expenditures
for both business segments of the Company appears in Note 17 of Notes to
Consolidated Financial Statements in the Company's Annual Report to
Stockholders for the fiscal year ended December 31, 1996. Such information is
hereby incorporated by reference herein.

Steel Manufacturing Operations
------------------------------

 General

  Inland Steel Company, a wholly owned subsidiary of the Company, is directly
engaged in the production and sale of steel and related products and the
transportation of iron ore, limestone and certain other commodities (primarily
for its own use) on the Great Lakes. Certain subsidiaries and associated
companies of Inland Steel Company are engaged in the mining and pelletizing of
iron ore and in the operation of a cold-rolling mill and steel galvanizing
lines. All raw steel made by Inland Steel Company is produced at its Indiana
Harbor Works located in East Chicago, Indiana, which also has facilities for
converting the steel produced into semi-finished and finished steel products.

  Inland Steel Company has two divisions--the Inland Steel Flat Products
Company division and the Inland Steel Bar Company division. The Flat Products
division manages the Inland Steel Company's iron ore operations, conducts its
ironmaking operations, and produces the major portion of its raw steel. This
division also manufactures and sells steel sheet, strip and certain related
semi-finished products for the automotive, appliance, office furniture, steel
service center and electrical motor markets. The Flat Products division closed
its plate operations at year-end 1995. The Bar division manufactures and sells
special quality bars and certain related semi-finished products for forgers,
steel service centers, heavy equipment manufacturers, cold finishers and the
transportation industry.

  Inland Steel Company and Nippon Steel Corporation ("NSC") are participants,
through subsidiaries, in two joint ventures that operate steel-finishing
facilities near New Carlisle, Indiana. The total cost of these two facilities
was approximately $1.1 billion. I/N Tek, owned 60% by a wholly owned
subsidiary of Inland Steel Company and 40% by an indirect wholly owned
subsidiary of NSC, operates a cold-rolling mill that achieved operation at its
design capability in 1992. I/N Kote, owned equally by wholly owned
subsidiaries of Inland Steel Company and NSC (indirect in the case of NSC),
operates two galvanizing lines that achieved operation at their design
capacity in 1993. Inland Steel Company is also a participant, through a
subsidiary, in another galvanizing joint venture located near Walbridge, Ohio.
<PAGE>

 Raw Steel Production and Mill Shipments

  The following table shows, for the five years indicated, Inland Steel
Company's production of raw steel and, based upon American Iron and Steel
Institute data, its share of total domestic raw steel production:

<TABLE>
<CAPTION>
                                                       RAW STEEL PRODUCTION
                                                  ------------------------------
                                                                 INLAND STEEL
                                                  INLAND STEEL COMPANY AS A % OF
                                                  COMPANY (000    U.S. STEEL
                                                     TONS*)        INDUSTRY
                                                  ------------ -----------------
      <S>                                         <C>          <C>
      1996.......................................    5,519            5.3%**
      1995.......................................    5,419            5.2
      1994.......................................    5,309            5.3
      1993.......................................    5,003            5.2
      1992.......................................    4,740            5.2
</TABLE>
--------
 * Net tons of 2,000 pounds.
** Based on preliminary data from the American Iron and Steel Institute.

  The annual raw steelmaking capacity of Inland Steel Company was reduced to
6.0 million net tons from 6.5 million net tons effective September 1, 1991, as
Inland Steel Company ceased making ingots. The basic oxygen process accounted
for 92% and 91% of raw steel production of the Company in 1996 and 1995,
respectively. The remainder of such production was accounted for by electric
furnace.

  The total tonnage of steel mill products shipped by Inland Steel Company for
each of the five years 1992 through 1996 was 5.1 million tons in 1996; 5.1
million tons in 1995; 5.2 million tons in 1994; 4.8 million tons in 1993; and
4.3 million tons in 1992. In 1996, sheet, strip and certain related semi-
finished products accounted for 83% of the total tonnage of steel mill
products shipped from the Indiana Harbor Works, and bar and certain related
semi-finished products accounted for 17%.

  In 1996 and 1995, approximately 94% and 93%, respectively, of the shipments
of the Flat Products division and 92% and 93% respectively, of the shipments
of the Bar division were to customers in 20 mid-American states. Approximately
74% of the shipments of the Flat Products division and 82% of the shipments of
the Bar division in 1996 were to customers in a five-state area comprised of
Illinois, Indiana, Ohio, Michigan and Wisconsin, compared to 76% and 84% in
1995. Both divisions compete in these geographical areas, principally on the
basis of price, service and quality, with the nation's largest producers of
raw steel as well as with foreign producers and with many smaller domestic
mills.

  The steel market is highly competitive with major integrated producers,
including Inland Steel Company, facing competition from a variety of sources.
Many steel products compete with alternative materials such as plastics,
aluminum, ceramics, glass and concrete. Domestic steel producers have also
been adversely impacted by imports from foreign steel producers. Imports of
steel mill products accounted for 23.3% of the domestic market in 1996, up
from 21.4% in 1995 but below the 1984 peak of 26.4%. Many foreign producers
are owned, controlled, or subsidized by their governments, allowing them to
ship steel products into the domestic market despite decreased profit margins
or losses on such sales.

  Mini-mills provide significant competition in certain product lines,
primarily structural shapes, bars and rods. Mini-mills are relatively
efficient, low-cost producers that manufacture steel principally from scrap in
electric furnaces and, at this time, generally have lower capital, overhead,
employment and environmental costs than the integrated steel producers,
including Inland Steel Company. Mini-mills have been adding capacity and
expanding their product lines in recent years to produce larger structural
products and certain flat-rolled products, including coated products. A
significant increase in modern mini-mill capacity is anticipated within the
next two years.

  Certain facilities at the Indiana Harbor Works have been permanently closed
and others have been shut down for temporary periods. The 28-inch structural
mill was closed in early 1991, reflecting a decision to

                                       2
<PAGE>

withdraw from the structural steel markets. In late 1991 the mold foundry, No.
8 Coke Oven Battery, and selected other facilities were closed either as part
of a program to permanently reduce costs through the closure of uneconomic
facilities or for environmental reasons. Provisions with respect to the shut-
down of the structural mill were taken in 1987. Provisions for estimated costs
incurred in connection with the closure of the mold foundry, No. 8 Coke Oven
Battery, and selected other facilities were made in 1991. Included in such
provisions were costs associated with Inland Steel Company's closure of its
No. 11 Coke Oven Battery in June 1992. All remaining coke batteries were
closed by year-end 1993, a year earlier than previously anticipated. An
additional provision was required with respect to those closures. (See
"Environment" below.) At year-end 1995 the plate mill was closed. Provisions
for such closure were taken prior to and in 1991.

  For the five years indicated, shipments by market classification of steel
mill products produced by Inland Steel Company at its Indiana Harbor Works,
including shipments to affiliates of Inland Steel Company, are set forth
below. As shown in the table, a substantial portion of shipments by the Flat
Products division was to steel service centers and transportation-related
markets. The Bar division shipped more than 61% of its products to the steel
converters/processors market over the five-year period shown in the table.

<TABLE>
<CAPTION>
                                                         PERCENTAGE OF TOTAL
                                                               TONNAGE
                                                          OF STEEL SHIPMENTS
                                                       ----------------------------
                                                       1996  1995  1994  1993  1992
                                                       ----  ----  ----  ----  ----
      <S>                                              <C>   <C>   <C>   <C>   <C>
      Steel Service Centers:
        Affiliates....................................  10%    9%    9%    9%    7%
        Non-Affiliates................................  22    23    20    22    22
                                                       ---   ---   ---   ---   ---
                                                        32    32    29    31    29
      Automotive......................................  29    30    32    30    28
      Steel Converters/Processors.....................  14    14    12    13    18
      Appliance.......................................   9     8     9     9     9
      Industrial, Electrical and Farm Machinery.......   8     7     8     7     8
      Construction and Contractors' Products..........   2     2     2     3     3
      Other...........................................   6     7     8     7     5
                                                       ---   ---   ---   ---   ---
                                                       100%  100%  100%  100%  100%
                                                       ===   ===   ===   ===   ===
</TABLE>

  Some value-added steel processing operations for which Inland Steel Company
does not have facilities are performed by outside processors, including joint
ventures, prior to shipment of certain products to Inland Steel Company's
customers. In 1996, approximately 44% of the products produced by Inland Steel
Company were processed further through value-added services such as
electrogalvanizing, painting and slitting.

  Approximately 73% of the total tonnage of shipments by Inland Steel Company
during 1996 from the Indiana Harbor Works was transported by truck, with the
remainder transported primarily by rail. A wholly owned truck transport
subsidiary of Inland Steel Company was responsible for shipment of
approximately 22% of the total tonnage of products transported by truck from
the Indiana Harbor Works in 1996.

  Substantially all of the steel mill products produced by the Flat Products
division are marketed through its own selling organization, with offices
located in Chicago; Southfield, Michigan; and Nashville, Tennessee.
Substantially all of the steel mill products produced by the Bar division are
marketed through its sales office in East Chicago, Indiana.

  See "Product Classes" below for information relating to the percentage of
consolidated net sales accounted for by certain classes of similar products of
steel manufacturing operations.

 Raw Materials

  Inland Steel Company obtains iron ore pellets primarily from three iron ore
properties, located in the United States and Canada, in which subsidiaries of
Inland Steel Company have varying interests--the Empire Mine in Michigan, the
Minorca Mine in Minnesota and the Wabush Mine in Labrador and Quebec, Canada.
Inland Steel

                                       3
<PAGE>

Company has entered into a contract to sell its interest in the Wabush mine.
Inland Steel Company will purchase any ore requirements not met by its other
sources from the purchasers of the Wabush interest. Such sale is anticipated
to take place in the first half of 1997. Inland Steel Company has also closed
or terminated certain less cost-efficient iron ore mining operations. See
"Properties Relating to Steel Manufacturing Segment--Raw Materials Properties
and Interests" in Item 2 below for further information relating to such iron
ore properties.

  The following table shows (1) the iron ore pellets available to Inland Steel
Company, as of December 31, 1996, from properties of its subsidiaries and
through interests in raw materials ventures; (2) 1996 and 1995 iron ore pellet
production or purchases from such sources; and (3) the percentage of Inland
Steel Company's iron ore requirements represented by production or purchases
from such sources in 1996 and 1995.

<TABLE>
<CAPTION>
                                       IRON ORE
                                 TONNAGES IN THOUSANDS          % OF
                                (GROSS TONS OF PELLETS)   REQUIREMENTS (1)
                              --------------------------- -------------------
                              AVAILABLE AS OF PRODUCTION
                               DECEMBER 31,   -----------
                                  1996(2)     1996  1995    1996       1995
                              --------------- ----- ----- --------   --------
<S>                           <C>             <C>   <C>   <C>        <C>
INLAND STEEL MINING COMPANY
 PROPERTY
  Minorca--Virginia, MN......      60,000     2,735 2,769       38%        38%
IRON ORE VENTURES AND LONG-
TERM PURCHASE CONTRACTS
  Empire (40% owned)--Palmer,
   MI;
  Wabush (15.09% owned)--
   Wabush, Labrador and Point
   Noire, Quebec, Canada.....     108,000     4,034 3,961       55         55
                                  -------     ----- ----- --------   --------
    Total Iron Ore...........     168,000     6,769 6,730       93%        93%
                                  =======     ===== ===== ========   ========
</TABLE>
--------
(1) Requirements in excess of production are purchased or taken from
    stockpile.
(2) Net interest in proven reserves.

  All of Inland Steel Company's coal requirements are satisfied from
independent sources. In April 1996, Inland Steel Company entered into a
contract to purchase 1,000,000 tons of steam coal for the period of April 1,
1996 to December 31, 1997. Inland Steel Company purchased 29% of its 1996 coal
requirements under such contract, representing 64% of its steam coal
requirements. The balance of steam coal requirements is being met through a
short-term contract.

  Inland Steel Company's other coal requirements are for the PCI Associates
joint venture, in which a subsidiary of Inland Steel Company holds a 50%
interest. The PCI facility pulverizes coal for injection into Inland Steel
Company's blast furnaces. In 1996, Inland Steel Company entered into two
contracts to satisfy its PCI coal requirements. One covered 73% of 1996 PCI
coal requirements while the other covered the remaining 27%. Currently, the
1997 PCI facility's coal needs are satisfied under one requirements contract
subject to a force majeure provision.

  In December 1993, the last of Inland Steel Company's coke-making facilities
was permanently shut down. Inland Steel Company has entered into two long-term
purchase contracts, one of which requires the purchase of 1,400,000 tons of
coke and extends through July 1999 subject to force majeure provisions and may
be extended by mutual agreement of the parties. The second contract requires
the purchase of 350,000 tons of coke for the period January 1, 1996 through
December 31, 2000 on a take-or-pay basis, with a provision allowing Inland
Steel Company to sell the coke to others. Both contract terms require
purchases on an annualized basis at prices negotiated annually based on
certain market determinants. During 1996, Inland Steel Company satisfied 74%
of its total coke needs under such arrangements. The remainder of its
purchased coke requirements was obtained through contracts with independent
domestic and foreign sources.

  In November 1996, Inland Steel Company reached an agreement with Sun Coal
and Coke Company ("Sun") and a unit of NIPSCO Industries, Inc. ("NIPSCO") for
a heat recovery coke battery and an associated

                                       4
<PAGE>

energy recovery and flue-gas desulphurization facility, to be located on land
leased from Inland Steel Company at its Indiana Harbor Works. Sun will design,
build, finance and operate the coke-making portion of the project. A unit of
NIPSCO will design, build, finance and operate the portion of the project
which will clean the coke plant's flue gas and convert the heat into steam and
electricity. Sun, the NIPSCO unit and other third parties will invest
approximately $350 million in the project, which is expected to commence
operations in 1998. Inland Steel Company will also advance approximately $30
million during construction of the project which will be credited against an
energy tolling arrangement. Inland Steel Company has committed to purchase,
for approximately 15 years, 1.2 million tons of coke annually from the
facility on a take-or-pay basis at prices determined by certain cost factors,
as well as energy produced by the facility through a tolling arrangement.

  Inland Steel Company sold all of its limestone and dolomite properties in
September 1990. Inland Steel Company has entered into a long-term contract
with the buyer of the properties to purchase, subject to certain exceptions
and at prices which approximate market, the full amount of its annual
limestone needs through 2002.

  Approximately 62% of the iron ore pellets and virtually all of the limestone
received by Inland Steel Company at its Indiana Harbor Works in 1996 were
transported by its Great Lakes carriers. Contracts are in effect for the
transportation on the Great Lakes of the remainder of its iron ore pellet
requirements. Approximately 25% of Inland Steel Company's coal requirements
were transported in its hopper cars by unit train in 1996. The remainder of
Inland Steel Company's coal requirements was transported in independent
carrier-owned equipment or leased equipment. Approximately 35% of Inland Steel
Company's coke requirements in 1996 were transported in its own hopper cars,
45% in leased hopper cars, 10% in independent carrier-owned hopper cars, and
10% in independent carrier-owned river barges.

  See "Energy" below for further information relating to the use of coal in
the operations of Inland Steel Company.

 Product Classes

  The following table sets forth the percentage of consolidated net sales of
Inland Steel Company, for the five years indicated, contributed by each class
of similar products of Inland Steel Company and accounted for 10% or more of
consolidated net sales in such time period. The data includes sales to
affiliates of Inland Steel Company.

<TABLE>
<CAPTION>
                                                       1996  1995  1994  1993  1992
                                                       ----  ----  ----  ----  ----
<S>                                                    <C>   <C>   <C>   <C>   <C>
  Sheet and Strip.....................................  81%   82%   85%   88%   88%
  Bar and Structural..................................  19    18    15    12    12
                                                       ---   ---   ---   ---   ---
                                                       100%  100%  100%  100%  100%
                                                       ===   ===   ===   ===   ===
</TABLE>

  Sales to General Motors Corporation approximated less than 10% of
consolidated net sales in 1996, 10% in 1995, and 12% in each of 1994, 1993 and
1992. No other customer accounted for more than 10% of the consolidated net
sales of the Company during any of these years.

 Capital Expenditures and Investments in Joint Ventures

  In recent years, Inland Steel Company and its subsidiaries have made
substantial capital expenditures, principally at the Indiana Harbor Works, to
improve quality and reduce costs, and for pollution control. Additions by
Inland Steel Company and its subsidiaries to property, plant and equipment,
together with retirements and adjustments, for the five years ended December
31, 1996, are set forth below. Net capital additions during such period
aggregated $328.1 million.

<TABLE>
<CAPTION>
                                                DOLLARS IN MILLIONS
                                   ---------------------------------------------
                                             RETIREMENTS             NET CAPITAL
                                   ADDITIONS  OR SALES   ADJUSTMENTS  ADDITIONS
                                   --------- ----------- ----------- -----------
<S>                                <C>       <C>         <C>         <C>
1996..............................  $155.8     $  8.5       $ 5.6      $152.9
1995..............................   113.9       36.7         1.5        78.7
1994..............................   223.7       47.8         2.0       177.9
1993..............................    86.1      140.2        (1.2)      (55.3)
1992..............................    54.4       73.0        (7.5)      (26.1)
</TABLE>


                                       5
<PAGE>

  In recent years, Inland Steel Company's largest capital improvement projects
at the Indiana Harbor Works have emphasized reducing costs and improving
quality in the steel-processing sequence of Inland Steel Company. Inland Steel
Company and its subsidiaries made capital expenditures of $156 million in
1996. Such expenditures principally related to the purchase of new machinery
and equipment to maintain or improve operations at the Indiana Harbor Works.

  In July 1987, a wholly owned subsidiary of Inland Steel Company formed a
partnership, I/N Tek, with an indirect wholly owned subsidiary of NSC to
construct, own, finance and operate a cold-rolling facility with an annual
capacity of 1,500,000 tons, of which approximately 40% is cold-rolled
substrate for I/N Kote (described below). The I/N Tek facility, located near
New Carlisle, Indiana, achieved operation at its design capacity in 1992.
Inland Steel Company, which owns, through its subsidiary, a 60% interest in
the I/N Tek partnership is, with certain limited exceptions, the sole supplier
of hot band to be processed by the I/N Tek facility and generally has
exclusive rights to the production capacity of the facility.

  In September 1989, a wholly owned subsidiary of Inland Steel Company formed
a second partnership, I/N Kote, with an indirect wholly owned subsidiary of
NSC to construct, own, finance and operate two sheet steel galvanizing lines
adjacent to the I/N Tek facility. The subsidiary of Inland Steel Company owns
a 50% interest in I/N Kote. The I/N Kote facility consists of a hot-dip
galvanizing line and an electrogalvanizing line with a combined annual
capacity of 900,000 tons. The facility achieved operation at its design
capacity in 1993. Inland Steel Company has guaranteed 50% of I/N Kote's
permanent financing. I/N Kote has contracted to acquire its cold-rolled steel
substrate from Inland Steel Company, which supplies the substrate from the I/N
Tek facility and Inland Steel Company's Indiana Harbor Works.

  Further information regarding the I/N Tek and I/N Kote joint venture
projects will be set forth under the caption "Certain Relationships and
Related Transactions--Joint Ventures" in Industries' definitive Proxy
Statement which will be furnished to stockholders of Industries in connection
with its Annual Meeting scheduled to be held on May 28, 1997, and is
incorporated by reference into Item 13 of this Report.

  The amount budgeted for 1997 capital expenditures by Inland Steel Company
and its subsidiaries is approximately $100 million. It is anticipated that
capital expenditures will be funded from cash generated by operations and
advances from and capital contributions by the Company. (See "Environment"
below for a discussion of capital expenditures for pollution control
purposes.)

 Employees

  The monthly average number of active employees of Inland Steel Company and
its subsidiaries receiving pay during 1996 was approximately 9,700. At year-
end, approximately 7,000 employees were represented by the United Steelworkers
of America, of whom approximately 650 were on furlough or indefinite layoff.
Total employment costs decreased from $679 million in 1995 to $649 million in
1996, as lower direct compensation expense, including profit sharing
provisions, was in part offset by higher employee benefit costs.

  Beginning in 1991, Inland Steel Company embarked upon a major turnaround
strategy, with the assistance of an outside consulting firm, to significantly
reduce costs, increase revenues and improve asset utilization at Inland Steel
Company. With the closure of the plate operations at year-end 1995, Inland
Steel Company has completed the workforce reduction program which was part of
the turnaround strategy, reducing employment by 25%.

  The current labor agreement between Inland Steel Company and the United
Steelworkers of America, effective August 1, 1993, covers wages and benefits
through July 31, 1999. Among other things, the agreement provided a wage
increase of $.50 per hour in 1995 and a $500 bonus in each of 1993 and 1994
(totalling in each case approximately $4 million). All active employees
received an additional week of vacation in 1994 and in 1996. The agreement
provided for a reopener on wages and certain benefits in 1996 with an
arbitration provision to resolve unsettled issues, thereby precluding a work
stoppage over the six-year term of the contract. On

                                       6
<PAGE>

September 17, 1996 an arbitrator issued a decision selecting Inland Steel
Company's final offer of terms covering the second half of the six year
agreement. The terms provided a wage increase of $.50 per hour retroactive to
August 1, 1996 with increases of $.25 an hour in 1997 and 1998. A $1,000 lump
sum would be paid to active employees in each of the three remaining years of
the contract (totalling approximately $20 million). One additional holiday was
provided and retirement benefits were increased for active employees. The
agreement also provided for election of a union designee acceptable to
Industries' Board of Directors (Dr. Robert B. McKersie is such union designee),
restrictions on the ability of Inland Steel Company to reduce the union
workforce (generally limited to attrition and major facilities shutdowns) while
allowing greater flexibility to institute work rule changes, quarterly rather
than annual payment of profit sharing amounts, significant improvements in
pension benefits for active employees, and the securing of retiree health care
obligations through certain trust and second mortgage arrangements. "First
dollar" health care coverage is eliminated under the agreement through the
institution of co-payments and increased deductibles on medical benefits.

 Environment

  Inland Steel Company is subject to environmental laws and regulations
concerning emissions into the air, discharges into ground water and waterways,
and the generation, handling, labeling, storage, transportation, treatment and
disposal of waste material. These include various federal statutes regulating
the discharge or release of pollutants to the environment, including the Clean
Air Act, Clean Water Act, Resource Conservation and Recovery Act, Comprehensive
Environmental Response, Compensation and Liability Act of 1980 ("CERCLA," also
known as "Superfund"), Safe Drinking Water Act, and Toxic Substances Control
Act, as well as state and local requirements. Violations of these laws and
regulations can give rise to a variety of civil, administrative, and, in some
cases, criminal actions and could also result in substantial liabilities or
require substantial capital expenditures. In addition, under CERCLA the United
States Environmental Protection Agency (the "EPA") has authority to impose
liability for site remediation on waste generators, past and present site
owners and operators, and transporters, regardless of fault or the legality of
the original disposal activity. Liability under CERCLA is strict, joint and
several.

  On June 10, 1993, the U.S. District Court for the Northern District of
Indiana entered a consent decree that resolved all matters raised by a lawsuit
filed by the EPA in 1990. The consent decree included a $3.5 million cash fine,
environmentally beneficial projects at the Indiana Harbor Works through 1997
costing approximately $7 million, and sediment remediation of portions of the
Indiana Harbor Ship Canal and Indiana Harbor Turning Basin estimated to cost
approximately $19 million over the next several years. The fine and estimated
remediation costs were provided for in 1991 and 1992. After payment of the
fine, Inland Steel Company's reserve for environmental liabilities totalled $19
million. In 1995 such reserve was increased to $26 million, with the increase
primarily intended to cover the costs of assessing environmental contamination
discussed below. The consent decree also defines procedures for corrective
action at Inland Steel Company's Indiana Harbor Works. The procedures defined
establish essentially a three-step process, each step of which requires
agreement of the EPA before progressing to the next step in the process,
consisting of: assessment of the site, evaluation of corrective measures for
remediating the site, and implementation of the remediation plan according to
the agreed-upon procedures. Inland Steel Company is presently assessing the
extent of environmental contamination. Inland Steel Company anticipates that
this assessment will cost approximately $2 million to $4 million over the next
several years. Because neither the nature and extent of the contamination nor
the corrective actions can be determined until the assessment of environmental
contamination and evaluation of corrective measures is completed, Inland Steel
Company cannot presently reasonably estimate the costs of or the time required
to complete such corrective actions. Such corrective actions may, however,
require significant expenditures over the next several years that may be
material to the financial position and results of operations of Inland Steel
Company. Insurance coverage with respect to such corrective actions is not
significant.

  By year-end 1993, the last of Inland Steel Company's coke-making facilities
was permanently shut down. All coke battery closures were necessitated by the
inability of the facilities to meet environmental regulations and their
deteriorating condition and performance. Inland Steel Company had anticipated
keeping such remaining

                                       7
<PAGE>

coke-making facilities operational through year-end 1994. The October 1993
decision to close these facilities early necessitated a fourth-quarter 1993
pre-tax charge of $22.3 million that included the write-off of property, plant
and equipment costs which were to be depreciated in 1994 and additional costs
related to the earlier-than-anticipated displacement of personnel. Inland Steel
Company has entered into two long-term contracts to satisfy the majority of its
coke needs. Inland Steel Company has also reached an agreement with Sun Coal
and Coke Company and a unit of NIPSCO for a heat recovery coke battery. (See
"Raw Materials" above.) In addition, Inland Steel Company participates in a
joint venture that has constructed and is operating a pulverized coal injection
facility for blast furnace application, reducing Inland Steel Company's coke
needs by approximately 25%. The facility achieved operation at its design
capacity in 1994.

  Capital spending for pollution control projects totaled $19 million in each
of 1996 and 1995. Another $44 million was spent in 1996 to operate and maintain
such equipment, versus $39 million a year earlier. During the five years ended
December 31, 1996, Inland Steel Company spent $282 million to construct,
operate and maintain environmental control equipment at its various locations.

  Environmental projects previously authorized and presently under
consideration, including those designed to comply with the 1990 Clean Air Act
Amendments, but excluding any amounts that would be required under the consent
decree settling the 1990 EPA lawsuit, will require capital expenditures of
approximately $7 million in 1997. It is anticipated that Inland Steel Company
will make annual capital expenditures of $5 million to $10 million in each of
the four years thereafter. In addition, Inland Steel Company will have ongoing
annual expenditures of $35 million to $45 million for the operation of air and
water pollution control facilities to comply with current federal, state and
local laws and regulations. Due to the inability to predict the costs of
corrective action that may be required under the Resource Conservation and
Recovery Act and the consent decree in the 1990 EPA lawsuit, Inland Steel
Company cannot predict the amount of additional environmental expenditures that
will be required. Such additional environmental expenditures, excluding amounts
that may be required in connection with the consent decree in the 1990 EPA
lawsuit, however, are not expected to be material to the financial position or
results of operations of Inland Steel Company.

  See Item 3 below for information concerning certain proceedings pertaining to
environmental matters in which Inland Steel Company is involved.

 Energy

  Coal, together with coke, all of which are purchased from independent
sources, accounted for approximately 74% of the energy consumed by Inland Steel
Company at the Indiana Harbor Works in 1996.

  Natural gas and fuel oil supplied approximately 24% of the energy
requirements of the Indiana Harbor Works in 1996 and are used extensively by
Inland Steel Company at other facilities that it owns or in which it has an
interest. Utilization of the pulverized coal injection facility (see
"Environment" above) has reduced natural gas and fuel oil consumption at the
Indiana Harbor Works.

  Inland Steel Company both purchases and generates electricity to satisfy
electrical energy requirements at the Indiana Harbor Works. In 1996, Inland
Steel Company produced approximately 59% of its requirements at the Indiana
Harbor Works. The purchase of electricity at the Indiana Harbor Works is
subject to curtailment under rules of the local utility when necessary to
maintain appropriate service for various classes of its customers.

  A subsidiary of NIPSCO has leased land at the Indiana Harbor Works and built
a 75 megawatt steam turbine on such land. Pursuant to a 15-year toll-charge
contract between Inland Steel Company and the NIPSCO subsidiary, the turbine
facility generates electricity for use by Inland Steel Company utilizing steam
produced by burning waste blast furnace gas. The facility became operational in
the first half of 1996 and it fulfills approximately 60% of the purchased
electricity requirements of the Indiana Harbor Works at prices below those
currently available to Inland Steel Company from other sources.


                                       8
<PAGE>

Materials Distribution Operations

  The Company's materials distribution operations in the United States are
conducted by its majority-owned materials distribution subsidiary, RT, through
its operating subsidiaries--Ryerson and Tull. RT has a single business segment,
which is comprised of Ryerson and Tull, leading steel service, distribution and
materials processing organizations. RT also owns 50% of Ryerson de Mexico, a
joint venture general line metals service center and processor with facilities
in Mexico.

  Ryerson, Tull and Ryerson Coil Processing Company ("Ryerson Coil"), a
specialized processing unit of Ryerson, are organized into five business units
along regional and product lines. RT believes that it is the largest metals
service center in the United States based on sales revenue, with 1996 sales of
$2.4 billion and a current U.S. market share of approximately 9%, based on RT's
analysis of data prepared by the Steel Service Center Institute ("SSCI"). RT
distributes and processes metals and other materials throughout the continental
United States, and is among the largest purchasers of steel in the United
States.

  Joseph T. Ryerson & Son, Inc.

  Ryerson, with business unit headquarters in Philadelphia, Pennsylvania
(Ryerson East), Chicago, Illinois (Ryerson Central), and Seattle, Washington
(Ryerson West) and including its wholly-owned subsidiary Thypin Steel Co., Inc.
("Thypin"), which was acquired by RT in February 1997 and is based in Long
Island City, New York, is a leading materials distribution organization. With
full-line service centers in 36 major cities, Ryerson is engaged in the
nationwide sale of its products through its own sales organization. Ryerson
maintains heavy-duty shears, slitters, precision cut-to-length lines, high-
speed saws, flame-cutting machines and other processing equipment for use in
furnishing custom cutting and miscellaneous shapes in accordance with customer
orders. The Ryerson Coil unit, headquartered in Chicago, performs processing
through five facilities for customers who traditionally buy large quantities of
sheet steel products. Ryerson also markets plant equipment products through a
wholesale industrial catalog.

  J. M. Tull Metals Company, Inc.

  Tull is one of the largest distributors of metals in the southeastern United
States. Tull and its wholly-owned subsidiary, AFCO Metals, Inc. ("AFCO"),
operate 20 service centers and two processing facilities located throughout the
southeastern and south-central United States. Tull produces a variety of metals
products with value-added processing, including welded steel tubing and roll-
formed shapes. Tull's products are sold principally through its own sales
staff.

  Ryerson de Mexico

  RT also owns a 50% interest in Ryerson de Mexico, a joint venture with Altos
Hornos de Mexico, S.A. de C.V., an integrated steel mill operating in Mexico.
Ryerson de Mexico, which was formed in 1994, is a general line metals service
center and processor with 12 facilities in Mexico. The impact of Ryerson de
Mexico on RT's results of operations has not been material.

 Industry Overview

  Primary steel producers typically sell steel in the form of standard-sized
coils, sheets, plate, structurals, bars and tubes and generally sell in large
volumes with long lead times for production and delivery. Other primary metals
producers, such as producers of stainless steel and aluminum, also typically
sell their products in large volumes with long lead times for production and
delivery. However, many customers seek to purchase metals with customized
specifications, including value-added processing, in smaller volumes, on
shorter lead times and with more reliable delivery than primary metals
producers are able to provide. Metals service centers act as intermediaries
between primary metals producers and customers by purchasing metals in a
variety of shapes and sizes from primary metals producers in large volumes,
allowing metals service centers to take advantage of

                                       9
<PAGE>

producer economies of scale resulting in lower costs of materials purchased,
and engaging in a variety of distribution and value-added processing operations
to meet the demands of specific customers. Because metals service centers
purchase metals from a number of primary producers, they can maintain a
consistent supply of various types of metal used by their customers. Most
importantly, however, metals service centers generally have lower fixed costs
than primary metals producers. By purchasing products from metals service
centers, customers may be able to lower their inventory levels, decrease the
time between the placement of an order and receipt of materials and reduce
internal expenses, thereby lowering their total cost of raw materials. RT
believes that the increased prevalence of just-in-time inventory needs of
manufacturers and intermediate processors has made and will continue to make
the value-added inventory, processing and delivery functions performed by
metals service centers more important in the metals market.

  The industry is cyclical (with periods of strong demand and higher prices
followed by periods of weaker demand and lower prices), principally due to the
cyclical nature of the industries in which the largest consumers of metals
operate. Any significant slowdown in one or more of those industries could have
a material adverse effect on the demand for metals, resulting in lower prices
for metals and reduced profitability for metals service centers, including RT.
Metals prices and metals service center profitability improve as metal-
consuming industries experience recoveries following economic downturns.

  The industry is comprised of many companies, the majority of which have
operations limited as to product line and size of inventory, with customers
located in a specific geographic area. Based on SSCI data, RT believes that the
industry is comprised of between 750 and 1,000 service centers, operating out
of approximately 2,000 locations and servicing approximately 300,000 customers.
The industry is highly fragmented, consisting of a large number of small
companies and a few relatively large companies. Based on RT's analysis of SSCI
data, the industry handled approximately 27 million tons or approximately 23.2%
of the metals distributed in the United States in 1996.

  The industry is divided into three major groups: general line service
centers, specialized service centers and processing centers, each of which
targets different market segments. General line service centers handle a broad
line of metals products and tend to concentrate on distribution rather than
processing. General line service centers range in size from one location to a
nationwide network of locations. For general line service centers, individual
order size in terms of dollars and tons tends to be small relative to
processing centers, while the total number of orders is typically very high.
Specialized service centers focus their activities on a narrower range of
product and service offerings than general line companies. Such service centers
provide a narrower range of services to their customers and emphasize product
expertise and lower operating costs, while maintaining a moderate level of
investment in processing equipment. Processing centers typically process large
quantities of steel purchased from primary producers for resale to large
industrial customers, such as the automotive industry. Because orders are
typically large, operation of a processing center requires a significant
investment in processing equipment.

 Products and Services

  RT carries a full line of carbon steel, stainless steel and aluminum, and a
limited line of alloy steel, nickel, red metals and plastics. These materials
are inventoried in a number of shapes, including coils, sheets, rounds,
hexagons, square and flat bars, plate, structurals and tubing.

  The following table sets forth RT's shipments (by percentage of RT's sales
revenue) for 1994, 1995 and 1996 for each of RT's product lines.

<TABLE>
<CAPTION>
                                                               PERCENTAGE OF
PRODUCT LINE                                                   SALES REVENUE
------------                                                   ----------------
                                                               1994  1995  1996
                                                               ----  ----  ----
<S>                                                            <C>   <C>   <C>
Stainless and aluminum........................................  23%   27%   26%
Carbon flat rolled............................................  28    24    27
Bars, tubing and structurals..................................  23    22    22
Fabrication and carbon plate..................................  19    20    20
Other.........................................................   7     7     5
                                                               ---   ---   ---
  Total....................................................... 100%  100%  100%
                                                               ===   ===   ===
</TABLE>

                                       10
<PAGE>

  More than one-half of the materials sold by RT is processed. RT uses
techniques such as sawing, slitting, blanking, pickling, cutting to length,
levelling, flame cutting, laser cutting, edge trimming, edge rolling,
fabricating and grinding to process materials to specified thickness, length,
width, shape and surface quality pursuant to specific customer orders. Among
the most common processing techniques used by RT are pickling, a chemical
process using an acidic solution to remove surface oxide, commonly called
"scale," from steel which develops after the steel is hot rolled; slitting,
which is cutting coiled metals to specified widths along the length of the
coil; levelling, which is flattening metals and cutting them to exact lengths;
and edge rolling, a process which imparts round or smooth edges. Although RT
often uses third-party fabricators to outsource certain limited processes that
RT is not able to perform internally, outsourcing these processes does not
affect a significant part of RT's operations or constitute a significant part
of RT's operating costs and expenses.

  The plate burning and fabrication processes are particularly important to RT.
These processes require sophisticated and expensive processing equipment. As a
result, rather than making investments in such equipment, manufacturers have
increasingly outsourced these processes to metals service centers. RT has flame
or laser cutting capacity in 41 of its 53 facilities.

  RT also provides services and technical advice to its customers as an
integral part of providing products to its customers. RT does not charge
customers separately for such services or advice, but rather includes the costs
of such services and advice in the price of products sold to such customers.

  RT's services include: just-in-time delivery, production of kits containing
multiple products for ease of assembly by the customer, the provision of
company-owned materials to the customer and the placement of company employees
at the customer's site for inventory management, production and technical
assistance. RT also provides special stocking programs where products that
would not otherwise be stocked by RT are held in inventory to meet certain
customer's needs. The foregoing services are designed to reduce customers'
costs by minimizing their investment in inventory and improving their
production efficiency.

 Customer Base

  RT's customer base is diverse, numbering over 50,000. No customer accounted
for more than 2% of RT's sales in 1996 and the top ten customers accounted for
approximately 10% of RT's sales in 1996. RT's customer base includes most
metal-consuming industries, most of which are cyclical. RT's shipments (by
percentage of RT's sales revenue) for 1994, 1995 and 1996 for each class of
RT's customers were as set forth in the table below.

<TABLE>
<CAPTION>
                                                               PERCENTAGE OF
CLASS OF CUSTOMER                                              SALES REVENUE
-----------------                                              ----------------
                                                               1994  1995  1996
                                                               ----  ----  ----
<S>                                                            <C>   <C>   <C>
Machinery manufacturers.......................................  36%   38%   38%
Fabricated metals producers...................................  25    25    26
Transportation equipment producers............................  10    10    10
Electrical machinery producers................................   9     9     8
Wholesale distributors........................................   3     3     3
Construction-related purchasers...............................   4     3     4
Metals mills and foundries....................................   3     3     3
Other.........................................................  10     9     8
                                                               ---   ---   ---
  Total....................................................... 100%  100%  100%
                                                               ===   ===   ===
</TABLE>

  RT's flat-rolled processing business unit, Ryerson Coil, generally serves a
customer base that differs from RT's general line service center business. A
large portion of Ryerson Coil's customers have long-term supply contracts.
These contracts are typically at fixed prices and are generally from three
months to one year in duration, although Ryerson Coil has a small number of
arrangements with large customers that extend beyond

                                       11
<PAGE>

one year. Ryerson Coil attempts to limit its financial exposure on these fixed-
price sales arrangements by entering into fixed-price supply arrangements with
one or more suppliers for comparable periods of time. Ryerson Coil's customers
often seek large quantities of carbon sheet product that have undergone one or
more of the following processes: pickling, cutting to length, slitting, tension
levelling, texturing or blanking. Many of Ryerson Coil's approximately 625
customers are in the transportation, appliance, office furniture or cabinetry
businesses.

 Suppliers

  In 1996, RT purchased in excess of 2.4 million tons of materials from many
suppliers, including approximately 460,000 tons (or approximately 11% of the
purchase dollars) from Inland Steel Company. RT expects to continue purchasing
significant amounts of steel from Inland Steel Company in the future, although
there can be no assurance that such purchases will continue. Excluding Inland
Steel Company, RT's top 25 suppliers accounted for approximately 40% of 1996
purchases in dollars.

  RT purchases the majority of its inventories in the open market at prevailing
market prices. However, occasionally RT enters into long-term, fixed-price
supply contracts to offset its long-term, fixed-price sales contracts in order
to minimize its financial exposure.

  Because RT uses many suppliers and because there is a substantial overlap of
product offerings from these suppliers, RT believes it will be able to meet its
materials requirements for the foreseeable future. RT works with and monitors
its suppliers in order to obtain improvements in price, quality, service,
delivery and performance. RT believes it has good relationships with most of
its suppliers.

 Sales and Marketing

  Each of RT's business units maintains its own sales and marketing force. In
addition to its office sales staff, RT markets and sells its products through
the use of its field sales force that has extensive product and customer
knowledge and through a comprehensive catalog of RT's products. RT's office and
field sales staffs, which together consist of approximately 800 employees,
include technical and metallurgical personnel. In addition, RT's technically-
oriented marketing departments develop advertising materials and maintain
product expertise for each of the various types of materials sold and
industries serviced by RT.

 Capital Expenditures

  In recent years RT has made capital expenditures to maintain, improve and
expand processing capabilities. Additions by RT to property, plant and
equipment, together with retirements and adjustments, for the five years ended
December 31, 1996, are set forth below. Net capital additions during such
period aggregated $64.4 million.

<TABLE>
<CAPTION>
                                                DOLLARS IN MILLIONS
                                   ---------------------------------------------
                                             RETIREMENTS             NET CAPITAL
                                   ADDITIONS  OR SALES   ADJUSTMENTS  ADDITIONS
                                   --------- ----------- ----------- -----------
<S>                                <C>       <C>         <C>         <C>
1996..............................   $24.1      $ 6.0       $--         $18.1
1995..............................    19.3        4.7        --          14.6
1994..............................    20.4       12.4        --           8.0
1993..............................    19.3        3.1        --          16.2
1992..............................     9.3        1.8        --           7.5
</TABLE>

  RT anticipates that capital expenditures and investments in joint ventures,
excluding acquisitions, will be in the range of $40-50 million for 1997 which
will be funded from cash generated by operations plus possible borrowing under
RT's credit facility.

 Employees

  As of December 31, 1996, RT employed approximately 4,850 persons. Of these
employees, approximately 2,250 were salaried employees and approximately 2,600
were hourly employees. Approximately 40% of the hourly employees were members
of various unions, including the United Steelworkers and the Teamsters. RT's

                                       12
<PAGE>

relationship with the various unions generally has been good, but occasional
work stoppages have occurred. Over the last five years, work stoppages have
occurred at two facilities (approximately 4% of the total number of
facilities), have involved an average of 43 employees and have lasted an
average of six days. During 1997, labor contracts covering approximately 180
employees at six facilities will expire. During 1998 contracts covering
approximately 160 employees at four facilities will expire. The current
agreement with the United Steelworkers will expire on July 31, 1999, and
agreements with the Teamsters expire on various dates during the period
beginning March 31, 1997 and ending June 30, 1999. While management does not
expect any unresolvable issues to arise in connection with the renewal of any
of these contracts, no assurances can be given that any of these contracts will
be extended prior to their expiration.

  Prior to April 30, 1996, certain of RT's employees were eligible to
participate in the Inland Steel Industries, Inc. Pension Plan, a
noncontributory defined benefit pension plan. Effective April 30, 1996, that
portion of the Inland Steel Industries, Inc. Pension Plan covering RT's current
and former employees was separated and became the Ryerson Tull Pension Plan.
Almost all employees are covered by company-provided life insurance and a
health benefits plan which provides broad health coverage for employees and
their families. Premiums for this health coverage are shared among RT and its
employees. RT believes that its salary and benefits structures are competitive
in the industry.

 Competition

  RT is engaged in a highly fragmented and competitive industry. In general,
competition is based on quality, service, price and geographic proximity. Based
on SSCI data, RT believes that the industry is comprised of between 750 and
1,000 service centers, operating out of approximately 2,000 locations. RT
competes with many other general line service centers, specialized service
centers and processing centers on a regional and local basis, some of which may
have greater financial resources and flexibility than RT. RT also competes to a
lesser extent with primary steel producers. Primary steel producers typically
sell to very large customers that require regular shipments of large volumes of
steel. Although these large customers sometimes use metals service centers to
supply a portion of their metals needs, metals service center customers
typically are consumers of smaller volumes of metals than customers of primary
steel producers. To the extent that some of RT's competitors purchase a higher
percentage of metals than RT from foreign steelmakers, such competitors may
benefit from favorable exchange rates or other economic or regulatory factors
that may result in a competitive advantage. This competitive advantage may be
offset somewhat by higher transportation costs associated with importing metals
into the United States. Excess capacity of metals relative to demand in the
industry since mid-1995 led to a weakening in prices. As a result, RT has been
reducing its prices since mid-1995 to remain competitive.

 Environmental, Health and Safety Matters

  RT's operations are subject to many federal, state and local regulations
relating to the protection of the environment and to workplace health and
safety. In particular, RT's operations are subject to extensive federal, state
and local laws and regulations governing waste disposal, air and water
emissions, the handling of hazardous substances, environmental protection,
remediation, workplace exposure and other matters. RT's management believes
that RT is presently in substantial compliance with all such laws and does not
currently anticipate that RT will be required to expend any substantial amounts
in the foreseeable future in order to meet current environmental, workplace
health or safety requirements. However, additional costs and liabilities may be
incurred to comply with current and future requirements, which costs and
liabilities could have a material adverse effect on RT's results of operations
or financial condition.

  There are no known pending remedial actions or claims relating to
environmental matters that are expected to have a material effect on RT's
financial position or results of operations. Some of the properties owned or
leased by RT, however, are located in industrial areas or have a history of
heavy industrial use. These properties may potentially incur environmental
liabilities in the future that could have a material adverse effect on RT's
financial condition or results of operations.


                                       13
<PAGE>

  Capital and operating expenses for pollution control projects were
significantly below $1,000,000 per year for the past five years and are
expected to remain at similar levels.

 Patents and Trademarks

  RT owns several U.S. patents and U.S. and foreign trademarks, service marks
and copyrights. Certain of the trademarks are registered with the U.S. Patent
and Trademark Office and, in certain circumstances, with the trademark offices
of various foreign countries. The patents expire over various periods of time
beginning in 2011. RT believes that the expiration of its patents will not
materially adversely affect its business. RT considers certain other
information owned by it to be trade secrets. RT protects its trade secrets by,
among other things, entering into confidentiality agreements with its employees
regarding such matters and implementing measures to restrict access to
sensitive data and computer software source code on a need-to-know basis. RT
believes that these safeguards adequately protect its proprietary rights and
vigorously defends these rights. While RT considers all of its intellectual
property rights as a whole to be important, RT does not consider any single
right to be essential to its operations as a whole.

OTHER FOREIGN OPERATIONS

  In 1994, the Company formed Inland International, Inc. to conduct the
Company's international operations, and it organized Inland International
Trading, Inc. to sell products and services of the Company and its affiliates
and purchase materials for them abroad. In 1995, Inland International Trading,
Inc. organized I.M.F. Steel International Limited, a Hong Kong company (in
which it and a subsidiary of the MacSteel Holdings (PTe.), Ltd. (South Africa)
each holds a 50% interest) to engage in the world-wide purchase and sale of
steel and related products. In 1994, an Inland International, Inc. subsidiary,
Inland Industries de Mexico, S.A. de C.V., and Altos Hornos de Mexico, S.A. de
C.V., formed Ryerson de Mexico, S.A. de C.V. to provide materials management
and technical services to the Mexican market. Inland Industries de Mexico, S.A.
de C.V. was transferred to RT on June 1, 1996. In the People's Republic of
China, the Company entered into a joint venture agreement with Baoshan Iron &
Steel Corporation pursuant to which Shanghai Ryerson Limited was organized to
conduct steel service center operations. In 1996, the Company entered into a
memorandum of understanding with The Tata Iron and Steel Co. Ltd., to organize
Tata Ryerson Limited in India to conduct steel service center operations there.
Substantially all of the Company's operations are located in the United States.
At year-end 1996, neither investments in foreign operations nor foreign sales
were material.

ITEM 2. PROPERTIES.

PROPERTIES RELATING TO STEEL MANUFACTURING SEGMENT

Steel Production

  All raw steel made by Inland Steel Company is produced at its Indiana Harbor
Works located in East Chicago, Indiana. The property on which this plant is
located, consisting of approximately 1,900 acres, is held by Inland Steel
Company in fee. The basic production facilities of Inland Steel Company at its
Indiana Harbor Works consist of furnaces for making iron; basic oxygen and
electric furnaces for making steel; a continuous billet caster, a continuous
combination slab/bloom caster and two continuous slab casters; and a variety of
rolling mills and processing lines which turn out finished steel mill products.
Certain of these production facilities, including a continuous anneal line, are
held by Inland Steel Company under leasing arrangements. Inland Steel Company
purchased the equity interest of the lessor of the No. 2 BOF Shop Caster
Facility in March 1994 and assumed caster-related debt, which was repaid by
year-end 1994. Substantially all of the remaining property, plant and equipment
at the Indiana Harbor Works, other than the Caster Facility and leased
equipment, is subject to the lien of the First Mortgage of Inland Steel Company
dated April 1, 1928, as amended and supplemented. See "Steel Manufacturing
Operations--Raw Steel Production and Mill Shipments" in Item 1 above for
further information relating to capacity and utilization of Inland Steel
Company's properties. Inland Steel Company's properties are adequate to serve
its present and anticipated needs, taking into account those issues discussed
in "Capital Expenditures and Investments in Joint Ventures" in Item 1 above.

                                       14
<PAGE>

  I/N Tek, a partnership in which a subsidiary of Inland Steel Company owns a
60% interest, has constructed a 1,500,000-ton annual capacity cold-rolling mill
on approximately 200 acres of land, which it owns in fee, located near New
Carlisle, Indiana. Substantially all the property, plant and equipment owned by
I/N Tek is subject to a lien securing related indebtedness. The I/N Tek
facility is adequate to serve the present and anticipated needs of Inland Steel
Company planned for such facility.

  I/N Kote, a partnership in which a subsidiary of Inland Steel Company owns a
50% interest, has constructed a 900,000-ton annual capacity steel galvanizing
facility on approximately 25 acres of land, which it owns in fee, located
adjacent to the I/N Tek site. Substantially all the property, plant and
equipment owned by I/N Kote is subject to a lien securing related indebtedness.
The I/N Kote facility is adequate to serve the present and anticipated needs of
Inland Steel Company planned for such facility.

  PCI Associates, a partnership in which a subsidiary of Inland Steel Company
owns a 50% interest, has constructed a pulverized coal injection facility on
land located within the Indiana Harbor Works. Inland Steel Company leases PCI
Associates the land upon which the facility is located. Substantially all the
property, plant and equipment owned by PCI Associates is subject to a lien
securing related indebtedness. The PCI Associates facility is adequate to serve
the present and anticipated needs of Inland Steel Company planned for such
facility.

  Inland Steel Company owns two vessels and leases one vessel for the
transportation of iron ore and limestone on the Great Lakes, and a subsidiary
of Inland Steel Company owns a fleet of 404 coal hopper cars (100-ton capacity
each) used in unit trains to move coal and coke to the Indiana Harbor Works.
See "Steel Manufacturing Operations--Raw Materials" in Item 1 above for further
information relating to utilization of Inland Steel Company's transportation
equipment. Such equipment is adequate, when combined with purchases of
transportation services from independent sources, to meet Inland Steel
Company's present and anticipated transportation needs.

  Inland Steel Company also owns and maintains research and development
laboratories in East Chicago, Indiana, which facilities are adequate to serve
its present and anticipated needs.

Raw Materials Properties and Interests

  Certain information relating to raw materials properties and interests of
Inland Steel Company and its subsidiaries is set forth below. See "Steel
Manufacturing Operations--Raw Materials" in Item 1 above for further
information relating to capacity and utilization of such properties and
interests.

  Iron Ore

  The operating iron ore properties of Inland Steel Company's subsidiaries and
of the iron ore ventures in which Inland Steel Company has an interest are as
follows:

<TABLE>
<CAPTION>
                                                                   ANNUAL
                                                             PRODUCTION CAPACITY
                                                              (IN THOUSANDS OF
                                                                GROSS TONS OF
      PROPERTY                            LOCATION                PELLETS)
      --------                   --------------------------- -------------------
      <S>                        <C>                         <C>
      Empire Mine............... Palmer, Michigan                   8,100
      Minorca Mine.............. Virginia, Minnesota                2,700
      Wabush Mine............... Wabush, Labrador and Pointe        5,700
                                  Noire, Quebec, Canada
</TABLE>

  The Empire Mine is operated by the Empire Iron Mining Partnership, in which
Inland Steel Company has a 40% interest. Inland Steel Company, through a
subsidiary, is the sole owner and operator of the Minorca Mine. The Wabush Mine
is a taconite project in which Inland Steel Company owns an approximately 15%
interest. Inland Steel Company has entered into a contract to sell its interest
in the Wabush mine. Such sale is anticipated to take place in the first half of
1997. Inland Steel Company also owns a 38% interest in the Butler Taconite
project (permanently closed in 1985) in Nashwauk, Minnesota.

                                       15
<PAGE>

  The reserves at the Empire Mine, the Minorca Mine and the Wabush Mine are
held under leases expiring, or expected at current production rates to expire,
between 2012 and 2040. Substantially all of the reserves at Butler Taconite are
held under leases. Inland Steel Company's share of the production capacity of
its interests in such iron ore properties is sufficient to provide the majority
of its present and anticipated iron ore pellet requirements. Any remaining
requirements have been and are expected to continue to be readily available
from independent sources. During 1992, the Minorca Mine's original ore body was
depleted and production shifted to a new major iron ore body, the Laurentian
Reserve, acquired by lease in 1990.

  Coal

  Inland Steel Company's sole remaining coal property, the Lancashire No. 25
Property, located near Barnesboro, Pennsylvania, is permanently closed. All
Inland Steel Company coal requirements for the past several years have been and
are expected to continue to be met through contract purchases and other
purchases from independent sources.

PROPERTIES RELATING TO MATERIALS DISTRIBUTION SEGMENT

Joseph T. Ryerson & Son, Inc.

  Ryerson owns its regional business unit headquarters offices in Chicago and
leases regional headquarters offices in West Chester (PA) and Renton (WA).
Ryerson East's service centers are at Buffalo, Carnegie (PA),
Charlotte, Chattanooga, Cleveland, Pittsburgh, and Wallingford (CT). Thypin,
which operates as a part of the Ryerson East business unit, maintains its
headquarters at Long Island City (NY) and service centers at the Village of
Blasdell (NY), Birmingham (AL), two at Cambridge (MA), one at Charlotte (NC)
and one each at Easton and Fairless Hills (PA). Ryerson Central's service
centers are at Chicago, Cincinnati, Dallas, Des Moines, one each at Detroit and
Holland (MI), Houston, Indianapolis, Kansas City, Milwaukee, Omaha, Plymouth
(MN), St. Louis, Tulsa, and Wausau (WI). Ryerson West's service centers are at
Commerce City (CO), Emeryville (CA), Los Angeles, Phoenix, Portland (OR),
Renton (WA), Spokane, and Salt Lake City. Ryerson Coil's processing facilities
are located in Chicago (two facilities), Marshalltown (IA), Plymouth (MN) and
New Hope (MN).

  All of Ryerson's operating facilities are held in fee with the exception of
the facility at Birmingham (AL) (held under short-term lease), two at Cambridge
(MA) (both held under short-term lease), one at Charlotte (NC) (held under
short-term lease), one at Chicago (held under short-term lease), one at Easton
(PA) (held under short-term lease), one at Fairless Hills (PA) (held under
long-term lease), one at Holland (MI) (held under long-term lease), one at Long
Island City (NY) (held under short-term lease), one at Marshalltown (IA) (held
under an installment purchase contract), two at New Hope (MN) (one partly held
in fee and partly under short-term lease, the other held under short-term
lease), a satellite facility at Omaha (held under short-term lease), a portion
of the property at Portland (held under short-term lease), a portion of the
property at St. Louis (held under long-term lease), one facility at Salt Lake
City (held under short-term lease), one at the Village of Blasdell (NY) (held
under short-term lease), and one at Wausau (WI) (held under short-term lease).
In addition, Ryerson holds in fee approximately 22 acres of unimproved property
at Powder Springs (GA), and the approximately 11-acre site of a former
operating facility at Allston (MA). The Allston (MA) property is currently
under contract for sale. Ryerson's properties are adequate to serve its present
and anticipated needs.

J. M. Tull Metals Company, Inc.

  Tull maintains service centers at Baton Rouge (LA), Birmingham (AL),
Charlotte (NC), Columbia (SC), Greensboro (NC), Greenville (SC), Jacksonville,
Miami, New Orleans, Pounding Mill (VA), Richmond, Tampa, and Norcross (GA),
where its headquarters is located. All of these facilities are owned by Tull in
fee, except for the Columbia facility, which is held under short-term lease.
AFCO operates service centers at Fort Smith (AR), Jackson (MS), Little Rock
(AR), Oklahoma City, Shreveport, West Memphis (AR) and Wichita (KA). AFCO's
headquarters are located at Norcross (GA), where it leases space owned in fee
by Tull. Each of AFCO's facilities is held in fee except the Wichita facility,
which is held under a short-term lease. Tull's properties are adequate to serve
its present and anticipated needs.

                                       16
<PAGE>

Ryerson de Mexico

  Ryerson de Mexico, a joint venture in which RT owns a 50% interest, owns
twelve general line metals service centers and processing centers in Mexico.
Ryerson de Mexico's properties are adequate to serve its present and
anticipated needs.

OTHER PROPERTIES

  The Company and certain of its subsidiaries lease, under a long-term
arrangement, approximately 63% of the space in the Inland Steel Building
located at 30 West Monroe Street, Chicago, Illinois (where the Company's
principal executive offices are located), which property interest is adequate
to serve the Company's present and anticipated needs. Approximately 33% of such
space is under sublease to other parties.

  Magnetics International, Inc., a subsidiary of the Company, owns
approximately 110 acres in northern Indiana. Certain subsidiaries of the
Company hold in fee at various locations an aggregate of approximately 355
acres of land, all of which is for sale. Inland Steel Company also holds in fee
approximately 300 acres of land adjacent to the I/N Tek and I/N Kote sites,
which land is available for future development. Approximately 1,060 acres of
rural land, which are held in fee at various locations in the north-central
United States by various raw materials ventures, are also for sale. In April
1996, Inland Steel Company's subsidiary, Inland Steel Mortgage Acceptance
Corporation, sold the combination office building and warehouse in Hoffman
Estates (IL) which was formerly owned by I R Construction Products Company,
Inc. (Inland Steel Company's former construction products business).

ITEM 3. LEGAL PROCEEDINGS.

  On June 10, 1993, the U.S. District Court for the Northern District of
Indiana entered a consent decree that resolved all matters raised by the
lawsuit filed by the EPA in 1990. The consent decree includes a $3.5 million
cash fine, environmentally beneficial projects at the Indiana Harbor Works
through 1997 costing approximately $7 million, and sediment remediation of
portions of the Indiana Harbor Ship Canal and Indiana Harbor Turning Basin
estimated to cost approximately $19 million over the next several years. The
fine and estimated remediation costs were provided for in 1991 and 1992. After
payment of the fine, Inland Steel Company's reserve for environmental
liabilities totalled $19 million. In 1995 such reserve was increased to $26
million, with the increase primarily intended to cover the costs of assessing
environmental contamination discussed below. The consent decree also defines
procedures for corrective action at Inland Steel Company's Indiana Harbor
Works. The procedures defined establish essentially a three-step process, each
step of which requires agreement of the EPA before progressing to the next step
in the process, consisting of: assessment of the site, evaluation of corrective
measures for remediating the site, and implementation of the remediation plan
according to the agreed-upon procedures. Inland Steel Company is presently
assessing the extent of environmental contamination. Inland Steel Company
anticipates that this assessment will cost approximately $2 million to $4
million over the next several years. Because neither the nature and extent of
the contamination nor the corrective actions can be determined until the
assessment of environmental contamination and evaluation of corrective measures
is completed, Inland Steel Company cannot presently reasonably estimate the
costs of or the time required to complete such corrective actions. Such
corrective actions may, however, require significant expenditures over the next
several years that may be material to the financial position and results of
operations of Inland Steel Company. Insurance coverage with respect to such
corrective actions is not significant.

  On March 22, 1985, the EPA issued an administrative order to Inland Steel
Company's former Inland Steel Container Company Division ("Division") naming
the former Division and various other unrelated companies as responsible
parties under the Comprehensive Environmental Response, Compensation and
Liability Act ("CERCLA") in connection with the cleanup of a waste disposal
facility operated by Duane Marine Salvage Corporation at Perth Amboy, New
Jersey. The administrative order alleged that certain of the former Division's
wastes were transported to, and disposed of at, that facility and required
Inland Steel Company to join with other named parties in taking certain actions
relating to the facility. Inland Steel Company and the other administrative

                                       17
<PAGE>

order recipients have completed the work required by the order. In unrelated
matters, the EPA also advised the former Division and various other unrelated
parties of other sites located in New Jersey at which the EPA expects to spend
public funds on any investigative and corrective measures that may be necessary
to control any releases or threatened releases of hazardous substances,
pollutants and contaminants pursuant to the applicable provisions of CERCLA.
The notice also indicated that the EPA believes Inland Steel Company may be a
responsible party under CERCLA. The extent of Inland Steel Company's
involvement and participation in these matters has not yet been determined.
While it is not possible at this time to predict the amount of Inland Steel
Company's potential liability, none of these matters is expected to materially
affect Inland Steel Company's financial position. Results of operations could
be materially affected for the particular reporting periods in which expenses
are incurred.

  On March 29, 1996, the EPA filed a lawsuit against Inland Steel Company in
the U.S. District Court for the Northern District of Indiana for alleged
violations of effluent limits contained in its National Pollution Discharge
Elimination System ("NPDES") permit and for the alleged discharge of pollutants
without the authorization of an NPDES permit. While it is not possible at this
time to predict the amount of Inland Steel Company's potential liability, this
matter is not expected to materially affect Inland Steel Company's financial
position. Results of operations could be materially affected for the particular
reporting periods in which expenses are incurred.

  The EPA has adopted a national policy of seeking substantial civil penalties
against owners and operators of sources for noncompliance with air and water
pollution control statutes and regulations under certain circumstances. It is
not possible to predict whether further proceedings will be instituted against
Inland Steel Company or any of its subsidiaries pursuant to such policy, nor is
it possible to predict the amount of any such penalties that might be assessed
in any such proceeding.

  Inland Steel Company received a Special Notice of Potential Liability
("Special Notice") from Indiana Department of Environmental Management ("IDEM")
on February 18, 1992 relating to the Four County Landfill Site, Fulton County,
Indiana (the "Facility"). The Special Notice stated that IDEM has documented
the release of hazardous substances, pollutants and contaminants at the
Facility and was planning to spend public funds to undertake an investigation
and control the release or threatened release at the Facility unless IDEM
determined that a potentially responsible party ("PRP") will properly and
promptly perform such action. The Special Notice further stated that Inland
Steel Company may be a PRP and that Inland Steel Company, as a PRP, may have
potential liability with respect to the Facility. In August 1993, Inland Steel
Company, along with other PRPs, entered into an Agreed Order with IDEM pursuant
to which the PRPs agreed to perform a Remedial Investigation/Feasibility Study
("RI/FS") for the Facility and pay certain past and future IDEM costs. In
addition, the PRPs agreed to provide funds for operation and maintenance
necessary for stabilization of the Facility. The costs which Inland Steel
Company has agreed to assume under the Agreed Order are not currently
anticipated to exceed $250,000. The cost of the final remedies which will be
determined to be required with respect to the Facility cannot be reasonably
estimated until, at a minimum, the RI/FS is completed. Inland Steel Company is
therefore unable to determine the extent of its potential liability, if any,
relating to the Facility or whether this matter could materially affect Inland
Steel Company's financial position or results of operations.

  In October 1996, Inland Steel Company received a notification from IDEM, as
lead administrative trustee, that the natural resource trustees (which also
include the Indiana Department of Natural Resources, the U.S. Department of the
Interior, Fish and Wildlife Service and the National Park Service) intend to
perform a natural resource damage assessment on the Grand Calumet River and
Indiana Harbor Canal system. The notification further states that Inland Steel
Company has been identified as a PRP in connection with the release of
hazardous substances and oil and the subsequent damages resulting from natural
resource injury. Because of the preliminary nature of this matter, it is not
possible at this time to predict the amount of Inland Steel Company's potential
liability or whether such potential liability could materially affect Inland
Steel Company's financial position.

ITEM 4. SUBMISSION OF MATTERS TO VOTE OF SECURITY HOLDERS.

  Not applicable.

                                       18
<PAGE>

                       EXECUTIVE OFFICERS OF REGISTRANT.

  Officers are elected by the Board of Directors of the Company to serve for a
period ending with the next succeeding annual meeting of the Board of
Directors held immediately after the annual meeting of stockholders. All
executive officers of the Company, with the exception of George A. Ranney,
Jr., have been employed by the Company or a subsidiary of the Company
throughout the past five years.

  Set forth below are the executive officers of the Company as of March 1,
1997 and the age of each as of such date. Their principal occupations at
present and during the past five years, including positions and offices held
with the Company or a significant subsidiary of the Company, are shown below.

    NAME, AGE AND PRESENT      POSITIONS AND OFFICES HELD DURING THE PAST FIVE
  POSITION WITH REGISTRANT                          YEARS

Robert J. Darnall, 58........  Mr. Darnall has been Chairman, President and
 Chairman, President, Chief    Chief Executive Officer of the Company since
 Executive Officer and         September 1992, and Chairman of the Executive
 Director                      Committee since January 1993. He was elected
                               President and Chief Operating Officer of the
                               Company in April 1986. He is also Chairman and
                               Chief Executive Officer of Inland Steel Company
                               and has been Chairman of RT since April 1995.
                               He was also Chairman of RT from November 1990
                               to June 1994. He joined Inland Steel Company in
                               1962, has served as its Chairman since 1992, as
                               its Chief Executive Officer from 1992 to 1995
                               and since April 1996, and as its President from
                               1984 to 1986, 1987 to 1992, and April 1996 to
                               May 1996.

Dale E. Wiersbe, 47... Senior  Mr. Wiersbe has been Senior Vice President of
 Vice President                the Company and President and Chief Operating
                               Officer of Inland Steel Company since May 1996.
                               He was Senior Vice President of Operations of
                               Inland Steel Flat Products Company ("ISFPCO")
                               division of Inland Steel Company from December
                               1995 to May 1996. He was also Vice President--
                               Integrated Steelmaking and Hot Rolling of ISFPCO
                               from May 1995 to December 1995, President of
                               Inland Steel Bar Company division of Inland Steel
                               Company from November 1993 to May 1995, Vice
                               President--Planning of ISFPCO from January 1993
                               to November 1993, Vice President--Cold Rolling
                               and Coating Operations of ISFPCO from May 1991
                               to January 1993.

Neil S. Novich, 42...........  Mr. Novich has been President and Chief
 President and                 Executive Officer and Chief Operating Officer
 ChiefExecutive Officer        of RT and President of Ryerson and Chairman of
 ofRyerson Tull, Inc.          Tull since June 1994. Mr. Novich was also
                               appointed a Director of RT in June 1994. He
                               served as Chairman of Ryerson from June 1994 to
                               April 1995. He was a Senior Vice President of
                               ISI from January 1995 to May 1996 and served as
                               a Vice President of ISI from June 1994 to
                               January 1995. Prior to joining ISI in 1994, he
                               led the Distribution and Logistics Practice at
                               Bain & Company ("Bain"), an international
                               management consulting firm, from 1987 and was
                               employed by Bain beginning in 1981.

Jay M. Gratz, 44........ Vice  Mr. Gratz has been Vice President, Finance and
 President, Finance and        Chief Financial Officer of the Company since
 Chief Financial Officer       May 1996 and has been Vice President, Finance
                               of RT since September 1994 and is Chief
                               Financial Officer of RT. He was Vice President,
                               Finance of Inland Steel Company from March 1993
                               to September 1994, and Vice President, Finance
                               of the Inland Steel Flat Products Company
                               division of Inland Steel Company from November
                               1991 to March 1993.

                                      19
<PAGE>

    NAME, AGE AND PRESENT      POSITIONS AND OFFICES HELD DURING THE PAST FIVE
  POSITION WITH REGISTRANT                          YEARS


Judd R. Cool, 61........ Vice  Mr. Cool has been Vice President--Human
 President--Human Resources    Resources of the Company since September 1987.
                               He was Vice President--Human Resources of
                               Inland Steel Company from May 1995 to July
                               1996. He was also Vice President--Human
                               Resources of Inland Steel Flat Products Company
                               division of Inland Steel Company from January
                               1993 to May 1995.

H. William Howard, 62... Vice  Mr. Howard has been Vice President--Information
 President--Information        Technology of the Company since September 1990.
 Technology                    He was Vice President--Automation and
                               Information Technology of Inland Steel Company
                               from May 1995 to December 1996. He was also
                               Vice President-- Automation and Information
                               Technology of Inland Steel Flat Products
                               Company division of Inland Steel Company from
                               January 1993 to May 1995.

George A. Ranney, Jr., 56 ...  Mr. Ranney has been Vice President and General
 Vice President and General    Counsel of the Company since July 1995. He is
 Counsel                       also a partner of the law firm of Mayer, Brown
                               & Platt, counsel to the Company. He has been a
                               partner with such firm since 1986.

Vicki L. Avril, 42...........  Ms. Avril has been Treasurer of the Company and
 Treasurer and Director--      of Inland Steel Company since January 1994, and
 Corporate Planning            Treasurer of RT, Ryerson and Tull since
                               February 1994. She also has been Director--
                               Corporate Planning since January 1995. In
                               addition, she was Director of Pension
                               Investments and Administration from June 1991
                               to January 1995, and Assistant Treasurer of the
                               Company from May 1993 to January 1994.

James M. Hemphill, 53........  Mr. Hemphill has been Controller of the Company
 Controller                    since September 1994. He was Director of
                               Financial Management of the Company from August
                               1992 to September 1994 and was Director of
                               Taxes of the Company from March 1988 to August
                               1992.

Charles B. Salowitz, 48......  Mr. Salowitz has been Secretary of the Company
 Secretary and Associate       since September 1995, its Associate General
 General Counsel               Counsel since January 1995, and Corporate
                               Secretary of RT since April 1996. He was an
                               Assistant General Counsel of the Company from
                               July 1989 to January 1995 and was Assistant
                               Secretary from July 1989 to September 1995.

                                    PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS.

  The common stock of the Company is listed and traded on the New York Stock
Exchange. As of March 12, 1997, the number of holders of record of common stock
of the Company was 13,873.

  The remaining information called for by this Item 5 is set forth under the
caption "Summary by Quarter" in the Company's Annual Report to Stockholders for
the fiscal year ended December 31, 1996, and is hereby incorporated by
reference herein.

                                       20
<PAGE>

ITEM 6. SELECTED FINANCIAL DATA.

  The information called for by this Item 6 with respect to each of the last
five years of the Company is set forth under the caption "Eleven-Year Summary
of Selected Financial Data and Operating Results" in the Company's Annual
Report to Stockholders for the fiscal year ended December 31, 1996, and is
hereby incorporated by reference herein.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
      OF OPERATIONS.

  The information called for by this Item 7 is set forth in the Financial
Review section of the Company's Annual Report to Stockholders for the fiscal
year ended December 31, 1996, and, excluding the tables entitled "Inland Steel
Company--Steel Shipments by Market" and "Ryerson Tull, Inc.--Shipments by
Market" and the bar charts entitled "Inland Steel Industries--Earnings Before
Interest, Taxes, and Depreciation," "Inland Steel Company--Productivity,"
"Ryerson Tull, Inc.--Quarterly Operating Profit," and "Inland Steel Industries-
-Debt to Total Capitalization," contained therein, is hereby incorporated by
reference herein.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

  The consolidated financial statements of the Company called for by this Item
8, together with the report thereon of the independent accountants dated
February 19, 1997, are set forth under the captions "Report of Independent
Accountants" and "Statement of Accounting and Financial Policies" as well as in
all consolidated financial statements and schedules of the Company and the
"Notes to Consolidated Financial Statements" in the Company's Annual Report to
Stockholders for the fiscal year ended December 31, 1996, and are hereby
incorporated by reference herein. The financial statement schedules listed
under Item 14(a)2 of this Report on Form 10-K, together with the report thereon
of the independent accountants dated February 19, 1997, should be read in
conjunction with the consolidated financial statements. Financial statement
schedules not included in this Report on Form 10-K have been omitted because
they are not applicable or because the information called for is shown in the
consolidated financial statements or notes thereto.

  Consolidated quarterly sales, earnings and per share common stock information
for 1995 and 1996 are set forth under the caption "Summary by Quarter" in the
Company's Annual Report to Stockholders for the fiscal year ended December 31,
1996, and are hereby incorporated by reference herein.

ITEM 9. DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

  None.

                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.

  The information called for by this Item 10 with respect to directors of the
Company will be set forth under the captions "Election of Directors" and
"Security Ownership of Directors and Management" in the Company's definitive
Proxy Statement which will be furnished to stockholders in connection with the
Annual Meeting of Stockholders to be held on May 28, 1997, and is hereby
incorporated by reference herein. The information called for with respect to
executive officers of the Company is included in Part I of this Report on Form
10-K under the caption "Executive Officers of Registrant."

ITEM 11. EXECUTIVE COMPENSATION.

  The information called for by this Item 11 will be set forth under the
caption "Executive Compensation" in the Company's definitive Proxy Statement
which will be furnished to stockholders in connection with the Annual Meeting
of Stockholders to be held on May 28, 1997, and is hereby incorporated by
reference herein.

                                       21
<PAGE>

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

  (a) The information called for by this Item 12 with respect to security
ownership of more than five percent of the Company's common stock, Series E
ESOP Convertible Preferred Stock and its 10.23% Subordinated Voting Notes will
be set forth under the caption "Additional Information Relating to Voting
Securities" in the Company's definitive Proxy Statement which will be furnished
to stockholders in connection with the Annual Meeting of Stockholders scheduled
to be held on May 28, 1997, and is hereby incorporated by reference herein.

  (b) The information called for by this Item 12 with respect to the security
ownership of directors and of management will be set forth under the caption
"Security Ownership of Directors and Management" in the Company's definitive
Proxy Statement which will be furnished to stockholders in connection with the
Annual Meeting of Stockholders to be held on May 28, 1997, and is hereby
incorporated by reference herein.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

  Information called for by this Item 13 will be set forth under the caption
"Certain Relationships and Related Transactions" in the Company's definitive
Proxy Statement which will be furnished to stockholders in connection with the
Annual Meeting of Stockholders to be held on May 28, 1997, and is hereby
incorporated by reference herein.

                                    PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.

  (A)DOCUMENTS FILED AS A PART OF THIS REPORT.

    1. CONSOLIDATED FINANCIAL STATEMENTS OF THE COMPANY. The consolidated
    financial statements listed below are set forth in the Company's Annual
    Report to Stockholders for the fiscal year ended December 31, 1996, and
    are incorporated by reference in Item 8 of this Annual Report on Form
    10-K.

      Report of Independent Accountants dated February 19, 1997.

      Statement of Accounting and Financial Policies.

      Consolidated Statements of Operations and Reinvested Earnings for
      the three years ended December 31, 1996.

      Consolidated Statement of Cash Flows for the three years ended
      December 31, 1996.

      Consolidated Balance Sheet at December 31, 1996 and 1995.

      Schedules to Consolidated Financial Statements at December 31, 1996
      and 1995, relating to:

              Investments and Advances.

              Property, Plant and Equipment.

              Long-Term Debt.

      Notes to Consolidated Financial Statements.

    2. FINANCIAL STATEMENT SCHEDULES OF THE COMPANY.

      Report of Independent Accountants on Financial Statement Schedules
      dated February 19, 1997. (Included on page 30 of this Report)

      Consent of Independent Accountants. (Included on page 30 of this
      Report)

      For the years ended December 31, 1996, 1995 and 1994:

              Schedule I -- Condensed Financial Information (Parent Company
              Only). (Included on pages 31 to 33, inclusive, of this Report)

              Schedule II -- Reserves. (Included on page 34 of this Report)

                                       22
<PAGE>

    3. EXHIBITS. The exhibits required to be filed by Item 601 of
    Regulation S-K are listed under the caption "Exhibits" below.

  (B)REPORTS ON FORM 8-K.

    No reports on Form 8-K were filed by the Company during the quarter
    ended December 31, 1996.

  (C)EXHIBITS.

<TABLE>
<CAPTION>
      EXHIBIT
      NUMBER
      -------
     <C>       <S>                                                          <C>
     3.(i)     Copy of Certificate of Incorporation, as amended, of the
               Company. (Filed as Exhibit 3.(i) to the Company's Annual
               Report on Form 10-K for the year ended December 31, 1995,
               and incorporated by reference herein.)
     3.(ii)    Copy of By-laws, as amended, of the Company. (Filed as Ex-
               hibit 3.(ii) to the Company's Quarterly Report on Form 10-
               Q for the quarter ended September 30, 1995, and incorpo-
               rated by reference herein.)
     4.A       Copy of Certificate of Designations, Preferences and
               Rights of Series A $2.40 Cumulative Convertible Preferred
               Stock of the Company. (Filed as part of Exhibit B to the
               definitive Proxy Statement of Inland Steel Company dated
               March 21, 1986 that was furnished to stockholders in con-
               nection with the annual meeting held April 23, 1986, and
               incorporated by reference herein.)
     4.B       Copy of Certificate of Designation, Preferences and Rights
               of Series D Junior Participating Preferred Stock of the
               Company. (Filed as Exhibit 4-D to the Company's Annual Re-
               port on Form 10-K for the fiscal year ended December 31,
               1987, and incorporated by reference herein.)
     4.C       Copy of Rights Agreement, dated as of November 25, 1987,
               as amended and restated as of May 24, 1989, between the
               Company and The First National Bank of Chicago, as Rights
               Agent (Harris Trust and Savings Bank, as successor Rights
               Agent). (Filed as Exhibit 1 to the Company's Current Re-
               port on Form 8-K filed on May 24, 1989, and incorporated
               by reference herein.)
     4.D       Copy of Certificate of Designations, Preferences and
               Rights of Series E ESOP Convertible Preferred Stock of the
               Company. (Filed as Exhibit 4-F to the Company's Quarterly
               Report on Form 10-Q for the quarter ended June 30, 1989,
               and incorporated by reference herein.)
     4.E       Copy of Subordinated Voting Note due December 17, 1999 in
               the amount of $100,000,000 from the Company to NS Finance
               III, Inc. (Filed as Exhibit 4.8 to Form S-3 Registration
               Statement No. 33-62897, and incorporated by reference
               herein.)
     4.F       Copy of Indenture dated as of December 15, 1992, between
               the Company and Harris Trust and Savings Bank, as Trustee,
               respecting the Company's $150,000,000 12 3/4% Notes due
               December 15, 2002. (Filed as Exhibit 4-G to the Company's
               Annual Report on Form 10-K for the fiscal year ended De-
               cember 31, 1992, and incorporated by reference herein.)
     4.G       Copy of Supplemental Indenture dated as of June 19, 1996
               between the Company and Harris Trust and Savings Bank, as
               Trustee, respecting the Company's $150,000,000 12 3/4%
               Notes. (Filed as Exhibit 4.G to the Company's Quarterly
               Report on Form 10-Q for the quarter ended June 30, 1996,
               and incorporated by reference herein.)
</TABLE>

                                       23
<PAGE>

<TABLE>
<CAPTION>
      EXHIBIT
      NUMBER
      -------
     <C>       <S>                                                          <C>
     4.H       Copy of First Mortgage Indenture, dated April 1, 1928, be-
               tween Inland Steel Company (the "Steel Company") and First
               Trust and Savings Bank and Melvin A. Traylor, as Trustees,
               and of supplemental indentures thereto, to and including
               the Thirty-Fifth Supplemental Indenture, incorporated by
               reference from the following Exhibits: (i) Exhibits B-
               1(a), B-1(b), B-1(c), B-1(d) and B-1(e), filed with Steel
               Company's Registration Statement on Form A-2 (No. 2-1855);
               (ii) Exhibits D-1(f) and D-1(g), filed with Steel
               Company's Registration Statement on Form E-1 (No. 2-2182);
               (iii) Exhibit B-1(h), filed with Steel Company's Current
               Report on Form 8-K dated January 18, 1937; (iv) Exhibit B-
               1(i), filed with Steel Company's Current Report on Form 8-
               K, dated February 8, 1937; (v) Exhibits B-1(j) and B-1(k),
               filed with Steel Company's Current Report on Form 8-K for
               the month of April, 1940; (vi) Exhibit B-2, filed with
               Steel Company's Registration Statement on Form A-2 (No. 2-
               4357); (vii) Exhibit B-1(l), filed with Steel Company's
               Current report on Form 8-K for the month of January, 1945;
               (viii) Exhibit 1, filed with Steel Company's Current Re-
               port on Form 8-K for the month of November, 1946; (ix) Ex-
               hibit 1, filed with Steel Company's Current Report on Form
               8-K for the months of July and August, 1948; (x) Exhibits
               B and C, filed with Steel Company's Current Report on Form
               8-K for the month of March, 1952; (xi) Exhibit A, filed
               with Steel Company's Current Report on Form 8-K for the
               month of July, 1956; (xii) Exhibit A, filed with Steel
               Company's Current Report on Form 8-K for the month of Ju-
               ly, 1957; (xiii) Exhibit B, filed with Steel Company's
               Current Report on Form 8-K for the month of January, 1959;
               (xiv) the Exhibit filed with Steel Company's Current Re-
               port on Form 8-K for the month of December, 1967; (xv) the
               Exhibit filed with Steel Company's Current Report on Form
               8-K for the month of April, 1969; (xvi) the Exhibit filed
               with Steel Company's Current Report on Form 8-K for the
               month of July, 1970; (xvii) the Exhibit filed with the
               amendment on Form 8 to Steel Company's Current Report on
               Form 8-K for the month of April, 1974; (xviii) Exhibit B,
               filed with Steel Company's Current Report on Form 8-K for
               the month of September, 1975; (xix) Exhibit B, filed with
               Steel Company's Current Report on Form 8-K for the month
               of January, 1977; (xx) Exhibit C, filed with Steel
               Company's Current Report on Form 8-K for the month of Feb-
               ruary, 1977; (xxi) Exhibit B, filed with Steel Company's
               Quarterly Report on Form 10-Q for the quarter ended June
               30, 1978; (xxii) Exhibit B, filed with Steel Company's
               Quarterly Report on Form 10-Q for the quarter ended June
               30, 1980; (xxiii) Exhibit 4-D, filed with Steel Company's
               Annual Report on Form 10-K for the fiscal year ended De-
               cember 31, 1980; (xxiv) Exhibit 4-D, filed with Steel
               Company's Annual Report on Form 10-K for the fiscal year
               ended December 31, 1982; (xxv) Exhibit 4-E, filed with
               Steel Company's Annual Report on Form 10-K for the fiscal
               year ended December 31, 1983; (xxvi) Exhibit 4(i) filed
               with the Steel Company's Registration Statement on Form S-
               2 (No. 33-43393); (xxvii) Exhibit 4 filed with Steel
               Company's Current Report on Form 8-K dated June 23, 1993;
               (xxviii) Exhibit 4.C filed with the Steel Company's Quar-
               terly Report on Form 10-Q for the quarter ended June 30,
               1995; (xxix) Exhibit 4.C filed with the Steel Company's
               Quarterly Report on Form 10-Q for the quarter ended Sep-
               tember 30, 1995; and (xxx) Exhibit 4.C filed with Steel
               Company's Quarterly Report on Form 10-Q for the quarter
               ended June 30, 1996.
     4.I       Copy of consolidated reprint of First Mortgage Indenture,
               dated April 1, 1928, between Inland Steel Company and
               First Trust and Savings Bank and Melvin A. Traylor, as
               Trustees, as amended and supplemented by all supplemental
               indentures thereto, to and including the Thirteenth Sup-
               plemental Indenture. (Filed as Exhibit 4-E to Form S-1
               Registration Statement No. 2-9443, and incorporated by
               reference herein.)
               [The registrant hereby agrees to provide a copy of any
               other agreement relating to long-term debt at the request
               of the Commission.]
</TABLE>


                                       24
<PAGE>

<TABLE>
<CAPTION>
      EXHIBIT
      NUMBER
      -------
     <C>       <S>                                                          <C>
     10.A*     Copy of Inland Steel Industries, Inc. Annual Incentive
               Plan, as amended. (Filed as Exhibit 10.A to the Company's
               Quarterly Report on Form 10-Q for the quarter ended Sep-
               tember 30, 1995, and incorporated by reference herein.)
     10.B*     Copy of Ryerson Tull Annual Performance Improvement Incen-
               tive Plan. (Filed as Exhibit 10.23 to the Ryerson Tull,
               Inc. Annual Report on Form 10-K for the fiscal year ended
               December 31, 1996, and incorporated by reference herein.)
     10.C*     Copy of Inland Steel Industries, Inc. Special Achievement
               Award Plan. (Filed as Exhibit 10-I to the Company's Annual
               Report on Form 10-K for the fiscal year ended December 31,
               1987, and incorporated by reference herein.)
     10.D*     Copy of Ryerson Tull 1996 Incentive Stock Plan. (Filed as
               Exhibit 10.11 to the Ryerson Tull, Inc. Annual Report on
               Form 10-K for the fiscal year ended December 31, 1996, and
               incorporated by reference herein.)
     10.E*     Copy of Inland 1995 Incentive Stock Plan. (Filed as Ex-
               hibit A to the Company's definitive Proxy Statement dated
               April 17, 1995 that was furnished to stockholders in con-
               nection with the annual meeting held May 24, 1995, and in-
               corporated by reference herein.)
     10.F*     Copy of Inland 1992 Incentive Stock Plan, as amended.
               (Filed as Exhibit 10.C to the Company's Quarterly Report
               on Form 10-Q for the quarter ended June 30, 1995, and in-
               corporated by reference herein.)
     10.G*     Copy of Inland 1988 Incentive Stock Plan, as amended.
               (Filed as Exhibit 10.B to the Company's Quarterly Report
               on Form 10-Q for the quarter ended June 30, 1995, and in-
               corporated by reference herein.)
     10.H*     Copy of Inland 1984 Incentive Stock Plan, as amended.
               (Filed as Exhibit 10.A to the Company's Quarterly Report
               on Form 10-Q for the quarter ended June 30, 1995, and in-
               corporated by reference herein.)
     10.I*     Copy of Inland Steel Industries Non-Qualified Thrift Plan,
               as amended. (Filed as Exhibit 10.D to the Company's Quar-
               terly Report on Form 10-Q for the quarter ended June 30,
               1995, and incorporated by reference herein.)
     10.J*     Copy of Inland 1992 Stock Plan for Non-Employee Directors,
               as amended. (Filed as Exhibit 10.E to the Company's Quar-
               terly Report on Form 10-Q for the quarter ended June 30,
               1995, and incorporated by reference herein.)
     10.K*     Copy of Inland Steel Industries Supplemental Retirement
               Benefit Plan for Covered Employees, as amended. (Filed as
               Exhibit 10.I to the Company's Annual Report on Form 10-K
               for the fiscal year ended December 31, 1993, and incorpo-
               rated by reference herein.)
     10.L*     Copy of Inland Steel Industries Special Retirement Benefit
               Plan for Covered Employees, as amended. (Filed as Exhibit
               10.J to the Company's Annual Report on Form 10-K for the
               fiscal year ended December 31, 1993, and incorporated by
               reference herein.)
     10.M*     Copy of Ryerson Tull, Inc. Supplemental Retirement Plan
               for Covered Employees. (Filed as Exhibit 10.10 to the
               Ryerson Tull, Inc. Registration Statement on Form S-1
               (File No. 333-3235), and incorporated by reference here-
               in.)
     10.N*     Copy of the Inland Steel Industries Deferred Compensation
               Plan for Certain Employees, as amended. (Filed as Exhibit
               10.J to the Company's Annual Report on Form 10-K for the
               fiscal year ended December 31, 1994, and incorporated by
               reference herein.)
</TABLE>


--------
*  Management contract or compensatory plan or arrangement required to be filed
   as an exhibit to the Company's Annual Report on Form 10-K.

                                       25
<PAGE>

<TABLE>
<CAPTION>
      EXHIBIT
      NUMBER
      -------
     <C>       <S>                                                          <C>
     10.O*     Copy of the Inland Steel Industries Deferred Compensation
               Plan for Directors, as amended. (Filed as Exhibit 10-L to
               the Company's Annual Report on Form 10-K for the fiscal
               year ended December 31, 1992, and incorporated by refer-
               ence herein.)
     10.P*     Copy of Inland Steel Industries Terminated Retirement Plan
               for Non-Employee Directors. (Filed as Exhibit 10.M to the
               Company's Annual Report on Form 10-K for the fiscal year
               ended December 31, 1995, and incorporated by reference
               herein.)
     10.Q*     Copy of Inland Steel Industries, Inc. Deferred Phantom
               Stock Unit Plan for Non-Employee Directors. (Filed as Ex-
               hibit 10.N to the Company's Annual Report on Form 10-K for
               the fiscal year ended December 31, 1995, and incorporated
               by reference herein.)
     10.R*     Copy of Outside Directors Accident Insurance Policy.
               (Filed as Exhibit 10-F to Inland Steel Company's Annual
               Report on Form 10-K for the fiscal year ended December 31,
               1983, and incorporated by reference herein.)
     10.S.(1)* Copy of form of Severance Agreement, dated March 27, 1996,
               between the Company and each of the four executive offi-
               cers of the Company identified on the exhibit relating to
               terms and conditions of termination of employment follow-
               ing a change in control of the Company. (Filed as Exhibit
               10.A to the Company's Quarterly Report on Form 10-Q for
               the quarter ended March 31, 1996, and incorporated by ref-
               erence herein.)
     10.S.(2)* Amended listing of executive officers of the Company who
               are parties to the form of Severance Agreement dated March
               27, 1996 in Exhibit 10.S.(1) hereof.
     10.S.(3)* Copy of form of Change in Control Agreements dated March
               27, 1996 between the Company and the parties listed on the
               schedule thereto. (Filed as Exhibit 10.5 to the Ryerson
               Tull, Inc. Form S-1 Registration Statement No. 333-3235,
               and incorporated by reference herein.)
     10.S.(4)* Copy of form of Change in Control Agreements dated as of
               June 10, 1996 between Ryerson Tull, Inc. and the parties
               listed on the Schedule thereto. (Filed as Exhibit 10.7 to
               the Ryerson Tull, Inc. Registration Statement on Form S-1
               (File No. 333-3235), and incorporated by reference here-
               in.)
     10.S.(5)* Copy of Change in Control Agreement dated as of June 10,
               1996 between Ryerson Tull, Inc. and Neil S. Novich. (Filed
               as Exhibit 10.8 to the Ryerson Tull, Inc. Registration
               Statement on Form S-1 (File No. 333-3235), and incorpo-
               rated by reference herein.)
     10.S.(6)* Copy of Change in Control Agreement dated as of March 27,
               1996 between the Company and Neil S. Novich. (Filed as Ex-
               hibit 10.6 to the Ryerson Tull, Inc. Form S-1 Registration
               Statement No. 333-3235, and incorporated by reference
               herein.)
     10.S.(7)* Copy of Severance Agreement dated June 28, 1989 between
               the Company and Judd R. Cool. (Filed as Exhibit 10-0-(2)
               to the Company's Annual Report on Form 10-K for the fiscal
               year ended December 31, 1989, and incorporated by refer-
               ence herein.)
     10.T.*    Copy of Employment Agreement dated as of April 8, 1994 be-
               tween the Company and Neil S. Novich. (Filed as Exhibit
               10.N.(8) to the Company's Annual Report on Form 10-K for
               the fiscal year ended December 31, 1994, and incorporated
               by reference herein.)
</TABLE>


--------
*  Management contract or compensatory plan or arrangement required to be filed
   as an exhibit to the Company's Annual Report on Form 10-K.

                                       26
<PAGE>

<TABLE>
<CAPTION>
      EXHIBIT
      NUMBER
      -------
     <C>       <S>                                                          <C>
     10.U.*    Copy of Assumption and Amendment Agreement dated July 24,
               1996 by and among Inland Steel Industries, Inc., Ryerson
               Tull, Inc. and Neil S. Novich. (Filed as Exhibit 10.A to
               the Company's Quarterly Report on Form 10-Q for the quar-
               ter ended September 30, 1996, and incorporated by refer-
               ence herein.)
     10.V(1)*  Copy of Employment Agreement between the Company and Carl
               G. Lusted, dated June 27, 1990 (Filed as Exhibit 10.4 to
               Ryerson Tull's Registration Statement on Form S-1 (File
               No. 333-3235), and incorporated by reference herein.)
     10.V(2)*  Copy of Assumption and Amendment Agreement dated January
               22, 1997 by and among the Company, Ryerson Tull, Inc. and
               Carl G. Lusted. (Filed as Exhibit 10.6 to the Ryerson
               Tull, Inc. Annual Report on Form 10-K for the fiscal year
               ended December 31, 1996, and incorporated by reference
               herein.)
     10.W.(1)* Copy of letter to Judd R. Cool dated September 2, 1987 re-
               lating to terms and conditions of employment. (Filed as
               Exhibit 10-K to the Company's Annual Report on Form 10-K
               for the fiscal year ended December 31, 1987, and incorpo-
               rated by reference herein.)
     10.W.(2)* Copy of letter agreement dated November 23, 1987 between
               the Company and Judd R. Cool. (Filed as Exhibit 10-L to
               the Company's Annual Report on Form 10-K for the fiscal
               year ended December 31, 1987, and incorporated by refer-
               ence herein.)
     10.W.(3)* Copy of letter agreement dated December 10, 1993 between
               the Company and Judd R. Cool restating certain provisions
               of the September 2, 1987 and November 23, 1987 letters in
               Exhibits 10.S.(1) and (2). (Filed as Exhibit 10.P.(3) to
               the Company's Annual Report on Form 10-K for the fiscal
               year ended December 31, 1993, and incorporated by refer-
               ence herein.)
     10.X*     Copy of letter to H. William Howard dated July 17, 1990
               relating to terms and conditions of employment. (Filed as
               Exhibit 10-P to the Company's Annual Report on Form 10-K
               for the fiscal year ended December 31, 1990, and incorpo-
               rated by reference herein.)
     10.Y      Copy of Stock Purchase Agreement, dated as of July 7,
               1989, between the Company and Harris Trust and Savings
               Bank, as ESOP Trustee. (Filed as Exhibit 4-G to the
               Company's Quarterly Report on Form 10-Q for the quarter
               ended June 30, 1989, and incorporated by reference here-
               in.)
     10.Z.(1)  Copy of Letter Agreement dated December 18, 1989 among the
               Company, Nippon Steel Corporation and NS Finance III, Inc.
               (an indirectly wholly owned subsidiary of Nippon Steel
               Corporation) relating to sale to NS Finance III, Inc. of
               185,000 shares of Series F Exchangeable Preferred Stock of
               the Company. (Filed as Exhibit 4(b) to the Company's Cur-
               rent Report on Form 8-K filed on December 18, 1989, and
               incorporated by reference herein.)
     10.Z.(2)  Copy of Steel Technology Agreement dated as of July 14,
               1989 between Inland Steel Company and Nippon Steel Corpo-
               ration relating to technology sharing between the signato-
               ries. (Filed as Exhibit 10-S-(2) to the Company's Annual
               Report on Form 10-K for the fiscal year ended December 31,
               1989, and incorporated by reference herein.)
     10.Z.(3)  Copy of Basic Agreement dated as of July 21, 1987 between
               the Company and Nippon Steel Corporation relating to the
               I/N Tek joint venture. (Filed as Exhibit 10-S-(3) to the
               Company's Annual Report on Form 10-K for the fiscal year
               ended December 31, 1989, and incorporated by reference
               herein.)
</TABLE>


--------
*  Management contract or compensatory plan or arrangement required to be filed
   as an exhibit to the Company's Annual Report on Form 10-K.

                                       27
<PAGE>

<TABLE>
<CAPTION>
      EXHIBIT
      NUMBER
      -------
     <C>       <S>                                                          <C>
     10.Z.(4)  Copy of Partnership Agreement dated as of July 21, 1987
               between ISC Tek, Inc. (an indirectly wholly owned subsidi-
               ary of the Company) and NS Tek, Inc. (an indirectly wholly
               owned subsidiary of Nippon Steel Corporation) relating to
               the I/N Tek joint venture. (Filed as Exhibit 10-S-(4) to
               the Company's Annual Report on Form 10-K for the fiscal
               year ended December 31, 1989, and incorporated by refer-
               ence herein.)
     10.Z.(5)  Copy of Basic Agreement dated as of September 12, 1989 be-
               tween the Company and Nippon Steel Corporation relating to
               the I/N Kote joint venture. (Filed as Exhibit 10-S-(5) to
               the Company's Annual Report on Form 10-K for the fiscal
               year ended December 31, 1989, and incorporated by refer-
               ence herein.)
     10.Z.(6)  Copy of Partnership Agreement dated as of September 12,
               1989 between ISC Kote, Inc. (an indirectly wholly owned
               subsidiary of the Company) and NS Tek, Inc. (an indirectly
               wholly owned subsidiary of Nippon Steel Corporation) re-
               lating to the I/N Kote joint venture. (Filed as Exhibit
               10-S-(6) to the Company's Annual Report on Form 10-K for
               the fiscal year ended December 31, 1989, and incorporated
               by reference herein.)
     10.Z.(7)  Copy of Substrate Supply Agreement dated as of September
               12, 1989 between Inland Steel Company and I/N Kote, an In-
               diana general partnership. (Filed as Exhibit 10-S-(7) to
               the Company's Annual Report on Form 10-K for the fiscal
               year ended December 31, 1989, and incorporated by refer-
               ence herein.)
     10.Z.(8)  Copy of First Amendment to Substrate Supply Agreement
               dated as of May 1, 1990 between Inland Steel Company and
               I/N Kote relating to the I/N Kote joint venture. (Filed as
               Exhibit
               10-R-(8) to the Company's Annual Report on Form 10-K for
               the fiscal year ended
               December 31, 1990, and incorporated by reference herein.)
     10.Z.(9)  Copy of Letter Agreement dated as of May 1, 1990 among I/N
               Kote, the Company and Nippon Steel Corporation relating to
               partner loans. (Filed as Exhibit 10-R-(9) to the Company's
               Annual Report on Form 10-K for the fiscal year ended De-
               cember 31, 1990, and incorporated by reference herein.)
     10.Z.(10) Copy of First Amendment to I/N Kote Basic Agreement dated
               as of May 1, 1990 between the Company and Nippon Steel
               Corporation relating to the I/N Kote joint venture. (Filed
               as Exhibit 10-R-(10) to the Company's Annual Report on
               Form 10-K for the fiscal year ended December 31, 1990, and
               incorporated by reference herein.)
     10.Z.(11) Copy of Letter Agreement dated as of April 19, 1990 be-
               tween the Company and Nippon Steel Corporation relating to
               capital contributions to I/N Tek. (Filed as Exhibit 10-R-
               (11) to the Company's Annual Report on Form 10-K for the
               fiscal year ended December 31, 1990, and incorporated by
               reference herein.)
     10.Z.(12) Copy of Letter Agreement dated April 20, 1990 between ISC
               Tek, Inc. (an indirectly wholly owned subsidiary of the
               Company) and NS Tek, Inc. (an indirectly wholly owned sub-
               sidiary of Nippon Steel Corporation) relating to amendment
               of the partnership agreement of I/N Tek. (Filed as Exhibit
               10-R-(12) to the Company's Annual Report on Form 10-K for
               the fiscal year ended December 31, 1990, and incorporated
               by reference herein.)
     10.Z.(13) Copy of CCM Override Amendment dated as of April 20, 1990
               among the Company; Nippon Steel Corporation; Inland Steel
               Company; ISC Tek, Inc.; I/N Tek; NS Sales, Inc.; and NS
               Tek, Inc. relating to I/N Tek. (Filed as Exhibit 10-R-(13)
               to the Company's Annual Report on Form 10-K for the fiscal
               year ended December 31, 1990, and incorporated by refer-
               ence herein.)
</TABLE>


                                       28
<PAGE>

<TABLE>
<CAPTION>
      EXHIBIT
      NUMBER
      -------
     <C>       <S>                                                          <C>
     10.AA     Copy of Inland Steel Industries Thrift Plan ESOP Trust,
               dated July 7, 1989, between the Company and Harris Trust
               and Savings Bank, as ESOP Trustee. (Filed as Exhibit 10-P
               to the Company's Quarterly Report on Form 10-Q for the
               quarter ended June 30, 1989, and incorporated by reference
               herein.)
     10.BB     Copy of First Amendment dated July 1, 1996 between the
               Company and LaSalle National Trust, N.A. as Successor ESOP
               Trustee, to the Inland Steel Industries Thrift Plan ESOP
               Trust, dated July 7, 1989, between the Company and Harris
               Trust and Savings Bank, as ESOP Trustee.
     10.CC     Letter Agreement dated March 1, 1991 between Nippon Steel
               Corporation and the Company regarding Series F Exchange-
               able Preferred Stock. (Filed as Exhibit 10-U to the
               Company's Annual Report on Form 10-K for the fiscal year
               ended December 31, 1990, and incorporated by reference
               herein.)
     10.DD     Letter Agreement dated May 10, 1991 by and between Nippon
               Steel Corporation and the Company relating to Letter
               Agreement dated December 18, 1989. (Filed as Exhibit 10-V
               to the Company's Quarterly Report on Form 10-Q for the
               quarter ended March 31, 1991, and incorporated by refer-
               ence herein.)
     11        Statement of Earnings per Share of Common Stock
     13        Information incorporated by reference from Annual Report
               to Stockholders for the fiscal year ended December 31,
               1996
     21        List of certain subsidiaries of the Company
     23        Consent of Independent Accountants, appearing on page 30
               of this Annual Report on Form 10-K.
     24        Powers of attorney
     27        Financial Data Schedules
     99        Letter to stockholders of common stock of the Company
               dated December 22, 1987 explaining Stockholder Rights Plan
               adopted by Board of Directors on November 25, 1987. (Filed
               as Exhibit 3 to the Company's Current Report on Form 8-K
               filed on December 18, 1987, and incorporated by reference
               herein.)
</TABLE>

                                       29
<PAGE>

      REPORT OF INDEPENDENT ACCOUNTANTS ON FINANCIAL STATEMENT SCHEDULES

To the Board of Directors
of Inland Steel Industries, Inc.

  Our audits of the consolidated financial statements referred to in our
report dated February 19, 1997 appearing on page 30 of the 1996 Annual Report
to Stockholders of Inland Steel Industries, Inc. (which report and
consolidated financial statements are incorporated by reference in this Annual
Report on Form 10-K) also included an audit of the Financial Statement
Schedules listed in Item 14(a)2 of this Annual Report on Form 10-K. In our
opinion, these Financial Statement Schedules present fairly, in all material
respects, the information set forth therein when read in conjunction with the
related consolidated financial statements.

                                          Price Waterhouse LLP

Chicago, Illinois
February 19, 1997

                      CONSENT OF INDEPENDENT ACCOUNTANTS

  We hereby consent to the incorporation by reference in the Prospectuses
constituting part of the Registration Statement on Form S-8 (No. 33-59783),
Registration Statement on Form S-8 (No. 33-48770), Registration Statement on
Form S-8 (No. 33-22902), Post-Effective Amendment No. 1 on Form S-8 to
Registration Statement on Form S-4 (No. 33-4046), Registration Statement on
Form S-8 (No. 33-32504), Post-Effective Amendment No. 2 to Form S-8
Registration Statement (No. 33-6627), Registration Statement on Form S-3 (No.
33-59161) and Registration Statement on Form S-3 (No. 33-62897) of Inland
Steel Industries, Inc. (or, for registrations prior to 1986, Inland Steel
Company) of our report dated February 19, 1997, appearing on page 30 of the
1996 Annual Report to Stockholders of Inland Steel Industries, Inc. which is
incorporated in this Annual Report on Form 10-K. We also consent to the
incorporation by reference of our report on the Financial Statement Schedules,
which appears above.

                                          Price Waterhouse LLP

Chicago, Illinois
March 27, 1997

                                      30
<PAGE>

                         INLAND STEEL INDUSTRIES, INC.

                  SCHEDULE I--CONDENSED FINANCIAL INFORMATION
                             (PARENT COMPANY ONLY)

                            STATEMENT OF OPERATIONS

                  YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
                             (DOLLARS IN MILLIONS)

<TABLE>
<CAPTION>
                             1996     1995      1994
                            -------  ------    ------
<S>                         <C>      <C>       <C>
Income:
  Intercompany interest
   income.................  $  18.5  $ 16.3    $ 10.0
  Equity in income of
   subsidiaries...........     41.4   157.8     109.6
  Interest income and
   other revenue..........     11.9     1.6       4.4
  Gain on sale of
   subsidiary stock.......     31.4     --        --
                            -------  ------    ------
                              103.2   175.7     124.0
Expenses:
  Interest and other
   expenses...............     32.6    31.0      22.9
  Intercompany interest
   expense................      2.4     5.7       2.1
                            -------  ------    ------
                               35.0    36.7      25.0
Income before income taxes
 and extraordinary loss...     68.2   139.0      99.0
Provision for income
 taxes....................      8.0     7.8Cr.    8.4Cr.
                            -------  ------    ------
Income before
 extraordinary loss.......     60.2   146.8     107.4
Extraordinary loss on
 early retirement of debt.    (14.5)    --        --
                            -------  ------    ------
Net income................  $  45.7  $146.8    $107.4
                            =======  ======    ======
</TABLE>
--------
Cr. = Credit



           See Notes to Consolidated Financial Statements in Item 8.

                                       31
<PAGE>

                         INLAND STEEL INDUSTRIES, INC.

                  SCHEDULE I--CONDENSED FINANCIAL INFORMATION
                             (PARENT COMPANY ONLY)

                            STATEMENT OF CASH FLOWS

                  YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
                             (DOLLARS IN MILLIONS)

<TABLE>
<CAPTION>
                                                       1996     1995     1994
                                                      -------  -------  -------
<S>                                                   <C>      <C>      <C>
OPERATING ACTIVITIES
Net income..........................................  $  45.7  $ 146.8  $ 107.4
Adjustments to reconcile net income to net cash
 provided from operating activities:
  Equity in undistributed earnings of subsidiaries..    (41.4)  (157.8)  (109.6)
  Depreciation......................................       .5       .6       .6
  Deferred income taxes.............................     11.7      4.5      3.2
  Deferred employee benefit cost....................      2.3       .3      2.3
  Gain from issuance of subsidiary stock............    (31.4)     --       --
  Stock issued for coverage of employee benefit
   plans............................................     22.6     23.9     35.0
  Change in: Intercompany accounts..................   (201.2)    16.0     (7.8)
      Notes receivable..............................      (.1)     (.3)     (.3)
      Accounts payable..............................       .9     (2.9)    (1.8)
      Accrued liabilities...........................     (9.9)     4.9     (3.2)
  Other deferred items..............................     (5.4)     8.3     (1.4)
                                                      -------  -------  -------
    Net adjustments.................................   (251.4)  (102.5)   (83.0)
                                                      -------  -------  -------
    Net cash provided from operating activities.....   (205.7)    44.3     24.4
                                                      -------  -------  -------
INVESTING ACTIVITIES
Net investments in subsidiaries.....................     (6.1)   (10.2)  (120.5)
Dividends received from subsidiaries................    471.7     25.9     25.8
Capital expenditures................................      --       --       (.2)
                                                      -------  -------  -------
    Net cash provided from (used for) investing
     activities.....................................    465.6     15.7    (94.9)
                                                      -------  -------  -------
FINANCING ACTIVITIES
Issuance of common stock............................      --      99.1      --
Long-term debt retired..............................   (238.4)    (8.3)    (7.8)
Dividends paid......................................    (21.0)   (31.6)   (32.2)
Acquisition of treasury stock.......................     (3.7)    (4.0)    (4.0)
                                                      -------  -------  -------
    Net cash provided from (used for) financing
     activities.....................................   (263.1)    55.2    (44.0)
                                                      -------  -------  -------
Net increase (decrease) in cash and cash
 equivalents........................................     (3.2)   115.2   (114.5)
Cash and cash equivalents--beginning of year........    205.5     90.3    204.8
                                                      -------  -------  -------
Cash and cash equivalents--end of year..............  $ 202.3  $ 205.5  $  90.3
                                                      =======  =======  =======
</TABLE>

           See Notes to Consolidated Financial Statements in Item 8.

                                       32
<PAGE>

                         INLAND STEEL INDUSTRIES, INC.

                  SCHEDULE I--CONDENSED FINANCIAL INFORMATION
                             (PARENT COMPANY ONLY)

                                 BALANCE SHEET

                         AT DECEMBER 31, 1996 AND 1995
                             (DOLLARS IN MILLIONS)

<TABLE>
<CAPTION>
                                                               1996      1995
                                                             --------  --------
<S>                                                          <C>       <C>
ASSETS
Current Assets:
  Cash and cash equivalents................................  $  202.3  $  205.5
  Receivables from subsidiary companies....................     292.3      91.1
  Deferred income taxes....................................        .3        .3
  Notes receivable.........................................        .7        .6
                                                             --------  --------
    Total current assets...................................     495.6     297.5
Investment in subsidiary companies.........................     558.6     958.1
Intangible pension asset...................................      76.3     102.6
Investment in Nippon Steel Corporation, net of valuation
 allowances of $4.8 and $4.0, respectively.................       9.8      10.6
Property, net of accumulated depreciation of $7.8 and $7.3,
 respectively..............................................       1.3       1.8
Deferred income taxes......................................        .3      13.7
Deferred charges and other assets..........................       2.4       6.5
                                                             --------  --------
    Total assets...........................................  $1,144.3  $1,390.8
                                                             ========  ========
LIABILITIES
Current Liabilities:
  Accounts payable.........................................  $    5.2  $    4.3
  Accrued liabilities......................................       9.6      19.5
  Long-term debt due within one year.......................       9.7      94.0
                                                             --------  --------
    Total current liabilities..............................      24.5     117.8
Long-term debt.............................................     202.1     356.2
Deferred employee benefits.................................      86.7     121.5
Deferred income and other deferred credits.................       9.9      12.2
                                                             --------  --------
    Total liabilities......................................     323.2     607.7
                                                             --------  --------
TEMPORARY EQUITY
Common stock repurchase commitment.........................      32.1      34.5
                                                             --------  --------
STOCKHOLDERS' EQUITY
Preferred stock, $1.00 par value, 15,000,000 shares
 authorized for all series, aggregate liquidation value
 $153.9 in 1996 and $155.7 in 1995.........................       3.2       3.2
Common stock, $1.00 par value; authorized--100,000,000
 shares; issued--50,556,350 shares.........................      50.6      50.6
Capital in excess of par value.............................   1,040.2   1,045.7
Accumulated deficit........................................    (146.0)   (172.8)
Unearned compensation--ESOP................................     (79.4)    (89.9)
Common stock repurchase commitment.........................     (32.1)    (34.5)
Treasury stock at cost--common stock of 1,647,954 shares in
 1996 and 1,814,516 shares in 1995.........................     (44.2)    (51.1)
Cumulative translation adjustment..........................      (3.3)     (2.6)
                                                             --------  --------
    Total stockholders' equity.............................     789.0     748.6
                                                             --------  --------
    Total liabilities, temporary equity, and stockholders'
     equity................................................  $1,144.3  $1,390.8
                                                             ========  ========
</TABLE>

Maturities of Long-Term Debt due within five years are: $9.7 million in 1997,
$10.5 million in 1998, $111.5 million in 1999, $12.5 million in 2000, and $13.6
million in 2001.

           See Notes to Consolidated Financial Statements in Item 8.

                                       33
<PAGE>

             INLAND STEEL INDUSTRIES, INC. AND SUBSIDIARY COMPANIES

                             SCHEDULE II--RESERVES

             FOR THE YEARS ENDED DECEMBER 31, 1996, 1995, AND 1994
                             (DOLLARS IN MILLIONS)

<TABLE>
<CAPTION>
                                              PROVISIONS FOR ALLOWANCES
                                             CLAIMS AND DOUBTFUL ACCOUNTS
                                      ------------------------------------------
   YEARS                              BALANCE AT ADDITIONS DEDUCTIONS BALANCE AT
   ENDED                              BEGINNING   CHARGED     FROM      END OF
DECEMBER 31                            OF YEAR   TO INCOME  RESERVES     YEAR
-----------                           ---------- --------- ---------- ----------
 <S>                                  <C>        <C>       <C>        <C>
 1996................................   $29.9      $ 1.7   $(2.5) (A)   $22.5
                                                            (6.6) (B)
 1995................................   $24.9      $11.8   $(1.1) (A)   $29.9
                                                            (5.7) (B)
 1994................................   $28.2      $ 5.8   $(2.4) (A)   $24.9
                                                            (6.7) (B)
</TABLE>
--------
NOTES:
(A) Bad debts written off during year.
(B)Allowances granted during year.

                                       34
<PAGE>

                                  SIGNATURES

  PURSUANT TO THE REQUIREMENTS OF SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934, THE COMPANY HAS DULY CAUSED THIS REPORT TO BE SIGNED ON
ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED.

                                          Inland Steel Industries, Inc.

Date: March 27, 1997                                Robert J. Darnall
                                          By: _________________________________
                                                     Robert J. Darnall
                                                  Chairman, President and
                                                  Chief Executive Officer
                                               (Principal Executive Officer)


  PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THIS
REPORT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS ON BEHALF OF THE COMPANY
AND IN THE CAPACITIES AND ON THE DATES INDICATED.

<TABLE>
<CAPTION>
             SIGNATURE                           TITLE                    DATE
             ---------                           -----                    ----

<S>                                  <C>                           <C>
         Robert J. Darnall             Chairman, President and       March 27, 1997
____________________________________ Chief Executive Officer and
         Robert J. Darnall               Director (Principal
                                          Executive Officer)

            Jay M. Gratz             Vice President, Finance and     March 27, 1997
____________________________________   Chief Financial Officer
            Jay M. Gratz                 (Principal Financial
                                               Officer)

         James M. Hemphill                    Controller             March 27, 1997
____________________________________    (Principal Accounting
         James M. Hemphill                     Officer)

          A. Robert Abboud                     Director

           James W. Cozad                      Director

         James A. Henderson                    Director

         Robert B. McKersie                    Director

           Leo F. Mullin                       Director     George A. Ranney, Jr.
                                                        By: ___________________
                                                            George A. Ranney, Jr.
         Donald S. Perkins                     Director      Attorney-in-fact
                                                              March 27, 1997

         Jean-Pierre Rosso                     Director

          Joshua I. Smith                      Director

          Nancy H. Teeters                     Director

          Arnold R. Weber                      Director

</TABLE>

                                      35
<PAGE>

                                 EXHIBIT INDEX

<TABLE>
<CAPTION>
                                                                    SEQUENTIAL
  EXHIBIT                                                              PAGE
  NUMBER                    DOCUMENT DESCRIPTION                      NUMBER
  -------                   --------------------                    ----------
 <C>       <S>                                                      <C>
  3.(i)    Copy of Certificate of Incorporation, as amended, of
           the Company. (Filed as Exhibit 3.(i) to the Company's
           Annual Report on Form 10-K for the year ended December
           31, 1995, and incorporated by reference herein.)             --
  3.(ii)   Copy of By-laws, as amended, of the Company. (Filed as
           Exhibit 3.(ii) to the Company's Quarterly Report on
           Form 10-Q for the quarter ended September 30, 1995,
           and incorporated by reference herein.)                       --
  4.A      Copy of Certificate of Designations, Preferences and
           Rights of Series A $2.40 Cumulative Convertible Pre-
           ferred Stock of the Company. (Filed as part of Exhibit
           B to the definitive Proxy Statement of Inland Steel
           Company dated March 21, 1986 that was furnished to
           stockholders in connection with the annual meeting
           held April 23, 1986, and incorporated by reference
           herein.)                                                     --
  4.B      Copy of Certificate of Designation, Preferences and
           Rights of Series D Junior Participating Preferred
           Stock of the Company. (Filed as Exhibit 4-D to the
           Company's Annual Report on Form 10-K for the fiscal
           year ended December 31, 1987, and incorporated by ref-
           erence herein.)                                              --
  4.C      Copy of Rights Agreement, dated as of November 25,
           1987, as amended and restated as of May 24, 1989, be-
           tween the Company and The First National Bank of Chi-
           cago, as Rights Agent (Harris Trust and Savings Bank,
           as successor Rights Agent). (Filed as Exhibit 1 to the
           Company's Current Report on Form 8-K filed on May 24,
           1989, and incorporated by reference herein.)                 --
  4.D      Copy of Certificate of Designations, Preferences and
           Rights of Series E ESOP Convertible Preferred Stock of
           the Company. (Filed as Exhibit 4-F to the Company's
           Quarterly Report on Form 10-Q for the quarter ended
           June 30, 1989, and incorporated by reference herein.)        --
  4.E      Copy of Subordinated Voting Note due December 17, 1999
           in the amount of $100,000,000 from the Company to NS
           Finance III, Inc. (Filed as Exhibit 4.8 to Form S-3
           Registration Statement No. 33-62897, and incorporated
           by reference herein.)                                        --
  4.F      Copy of Indenture dated as of December 15, 1992, be-
           tween the Company and Harris Trust and Savings Bank,
           as Trustee, respecting the Company's $150,000,000 12
           3/4% Notes due December 15, 2002. (Filed as Exhibit 4-
           G to the Company's Annual Report on Form 10-K for the
           fiscal year ended December 31, 1992, and incorporated
           by reference herein.)                                        --
  4.G      Copy of Supplemental Indenture dated as of June 19,
           1996 between the Company and Harris Trust and Savings
           Bank, as Trustee, respecting the Company's
           $150,000,000 12 3/4% Notes. (Filed as Exhibit 4.G to
           the Company's Quarterly Report on Form 10-Q for the
           quarter ended June 30, 1996, and incorporated by ref-
           erence herein.)                                              --
  4.H      Copy of First Mortgage Indenture, dated April 1, 1928,
           between Inland Steel Company (the "Steel Company") and
           First Trust and Savings Bank and Melvin A. Traylor, as
           Trustees, and of supplemental indentures thereto, to
           and including the Thirty-Fifth Supplemental Indenture,
           incorporated by reference from the following Exhibits:
           (i) Exhibits B-1(a), B-1(b), B-1(c), B-1(d) and B-1(e),
           filed with Steel Company's Registration Statement on
           Form A-2 (No. 2-1855); (ii) Exhibits D-1(f) and D-1(g),
           filed with Steel Company's Registration Statement on
           Form E-1 (No. 2-2182); (iii) Exhibit B-1(h), filed with
           Steel Company's Current Report on Form 8-K dated
           January 18, 1937; (iv) Exhibit B-1(i), filed with Steel
           Company's Current Report on Form 8-K, dated February 8,
           1937; (v) Exhibits
</TABLE>

                                       i
<PAGE>

<TABLE>
<CAPTION>
                                                                    SEQUENTIAL
  EXHIBIT                                                              PAGE
  NUMBER                    DOCUMENT DESCRIPTION                      NUMBER
  -------                   --------------------                    ----------
 <C>       <S>                                                      <C>
           B-1(j) and B-1(k), filed with Steel Company's Current
           Report on Form 8-K for the month of April, 1940; (vi)
           Exhibit B-2, filed with Steel Company's Registration
           Statement on Form A-2 (No. 2-4357); (vii) Exhibit B-
           1(l), filed with Steel Company's Current Report on
           Form 8-K for the month of January, 1945; (viii) Ex-
           hibit 1, filed with Steel Company's Current Report on
           Form 8-K for the month of November, 1946; (ix) Exhibit
           1, filed with Steel Company's Current Report on Form
           8-K for the months of July and August, 1948; (x) Ex-
           hibits B and C, filed with Steel Company's Current Re-
           port on Form 8-K for the month of March, 1952; (xi)
           Exhibit A, filed with Steel Company's Current Report
           on Form 8-K for the month of July, 1956; (xii) Exhibit
           A, filed with Steel Company's Current Report on Form
           8-K for the month of July, 1957; (xiii) Exhibit B,
           filed with Steel Company's Current Report on Form 8-K
           for the month of January, 1959; (xiv) the Exhibit
           filed with Steel Company's Current Report on Form 8-K
           for the month of December, 1967; (xv) the Exhibit
           filed with Steel Company's Current Report on Form 8-K
           for the month of April, 1969; (xvi) the Exhibit filed
           with Steel Company's Current Report on Form 8-K for
           the month of July, 1970; (xvii) the Exhibit filed with
           the amendment on Form 8 to Steel Company's Current Re-
           port on Form 8-K for the month of April, 1974; (xviii)
           Exhibit B, filed with Steel Company's Current Report
           on Form 8-K for the month of September, 1975; (xix)
           Exhibit B, filed with Steel Company's Current Report
           on Form 8-K for the month of January, 1977; (xx) Ex-
           hibit C, filed with Steel Company's Current Report on
           Form 8-K for the month of February, 1977; (xxi) Ex-
           hibit B, filed with Steel Company's Quarterly Report
           on Form 10-Q for the quarter ended June 30, 1978;
           (xxii) Exhibit B, filed with Steel Company's Quarterly
           Report on Form 10-Q for the quarter ended June 30,
           1980; (xxiii) Exhibit 4-D, filed with Steel Company's
           Annual Report on Form 10-K for the fiscal year ended
           December 31, 1980; (xxiv) Exhibit 4-D, filed with
           Steel Company's Annual Report on Form 10-K for the
           fiscal year ended December 31, 1982; (xxv) Exhibit 4-
           E, filed with Steel Company's Annual Report on Form
           10-K for the fiscal year ended December 31, 1983;
           (xxvi) Exhibit 4(i) filed with the Steel Company's
           Registration Statement on Form S-2 (No. 33-43393);
           (xxvii) Exhibit 4 filed with Steel Company's Current
           Report on Form 8-K dated June 23, 1993; (xxviii) Ex-
           hibit 4.C filed with the Steel Company's Quarterly Re-
           port on Form 10-Q for the quarter ended June 30, 1995;
           (xxix) Exhibit 4.C filed with the Steel Company's
           Quarterly Report on Form 10-Q for the quarter ended
           September 30, 1995; and (xxx) Exhibit 4.C filed with
           Steel Company's Quarterly Report on Form 10-Q for the
           quarter ended June 30, 1996.                                 --
  4.I      Copy of consolidated reprint of First Mortgage Inden-
           ture, dated April 1, 1928, between Inland Steel Com-
           pany and First Trust and Savings Bank and Melvin A.
           Traylor, as Trustees, as amended and supplemented by
           all supplemental indentures thereto, to and including
           the Thirteenth Supplemental Indenture. (Filed as Ex-
           hibit 4-E to Form S-1 Registration Statement No. 2-
           9443, and incorporated by reference herein.)                 --
           [The registrant hereby agrees to provide a copy of any
           other agreement relating to long-term debt at the re-
           quest of the Commission.]
 10.A*     Copy of Inland Steel Industries, Inc. Annual Incentive
           Plan, as amended. (Filed as Exhibit 10.A to the
           Company's Quarterly Report on Form 10-Q for the quar-
           ter ended September 30, 1995, and incorporated by ref-
           erence herein.)                                              --
 10.B*     Copy of Ryerson Tull Annual Performance Improvement
           Incentive Plan. (Filed as Exhibit 10.23 to the Ryerson
           Tull, Inc. Annual Report on Form 10-K for the fiscal
           year ended December 31, 1996, and incorporated by ref-
           erence herein.)                                              --
</TABLE>

--------
*  Management contract or compensatory plan or arrangement required to be
   filed as an exhibit to the Company's Annual Report on Form 10-K.


                                      ii

<PAGE>

<TABLE>
<CAPTION>
                                                                    SEQUENTIAL
  EXHIBIT                                                              PAGE
  NUMBER                    DOCUMENT DESCRIPTION                      NUMBER
  -------                   --------------------                    ----------
 <C>       <S>                                                      <C>
 10.C*     Copy of Inland Steel Industries, Inc. Special Achieve-
           ment Award Plan. (Filed as Exhibit 10-I to the
           Company's Annual Report on Form 10-K for the fiscal
           year ended December 31, 1987, and incorporated by ref-
           erence herein.)                                              --
 10.D*     Copy of Ryerson Tull 1996 Incentive Stock Plan. (Filed
           as Exhibit 10.11 to the Ryerson Tull, Inc. Annual Re-
           port on Form 10-K for the fiscal year ended December
           31, 1996, and incorporated by reference herein.)             --
 10.E*     Copy of Inland 1995 Incentive Stock Plan. (Filed as
           Exhibit A to the Company's definitive Proxy Statement
           dated April 17, 1995 that was furnished to stockhold-
           ers in connection with the annual meeting held May 24,
           1995, and incorporated by reference herein.)                 --
 10.F*     Copy of Inland 1992 Incentive Stock Plan, as amended.
           (Filed as Exhibit 10.C to the Company's Quarterly Re-
           port on Form 10-Q for the quarter ended June 30, 1995,
           and incorporated by reference herein.)                       --
 10.G*     Copy of Inland 1988 Incentive Stock Plan, as amended.
           (Filed as Exhibit 10.B to the Company's Quarterly Re-
           port on Form 10-Q for the quarter ended June 30, 1995,
           and incorporated by reference herein.)                       --
 10.H*     Copy of Inland 1984 Incentive Stock Plan, as amended.
           (Filed as Exhibit 10.A to the Company's Quarterly Re-
           port on Form 10-Q for the quarter ended June 30, 1995,
           and incorporated by reference herein.)                       --
 10.I*     Copy of Inland Steel Industries Non-Qualified Thrift
           Plan, as amended. (Filed as Exhibit 10.D to the
           Company's Quarterly Report on Form 10-Q for the quar-
           ter ended June 30, 1995, and incorporated by reference
           herein.)                                                     --
 10.J*     Copy of Inland 1992 Stock Plan for Non-Employee Direc-
           tors, as amended. (Filed as Exhibit 10.E to the
           Company's Quarterly Report on Form 10-Q for the quar-
           ter ended June 30, 1995, and incorporated by reference
           herein.)                                                     --
 10.K*     Copy of Inland Steel Industries Supplemental Retire-
           ment Benefit Plan for Covered Employees, as amended.
           (Filed as Exhibit 10.I to the Company's Annual Report
           on Form 10-K for the fiscal year ended December 31,
           1993, and incorporated by reference herein.)                 --
 10.L*     Copy of Inland Steel Industries Special Retirement
           Benefit Plan for Covered Employees, as amended. (Filed
           as Exhibit 10.J to the Company's Annual Report on Form
           10-K for the fiscal year ended December 31, 1993, and
           incorporated by reference herein.)                           --
 10.M*     Copy of Ryerson Tull, Inc. Supplemental Retirement
           Plan for Covered Employees. (Filed as Exhibit 10.10 to
           the Ryerson Tull, Inc. Registration Statement on Form
           S-1 (File No. 333-3235), and incorporated by reference
           herein.)                                                     --
 10.N*     Copy of the Inland Steel Industries Deferred Compensa-
           tion Plan for Certain Employees, as amended. (Filed as
           Exhibit 10.J to the Company's Annual Report on Form
           10-K for the fiscal year ended December 31, 1994, and
           incorporated by reference herein.)                           --
 10.O*     Copy of the Inland Steel Industries Deferred Compensa-
           tion Plan for Directors, as amended. (Filed as Exhibit
           10.L to the Company's Annual Report on Form 10-K for
           the fiscal year ended December 31, 1992, and incorpo-
           rated by reference herein.)                                  --
 10.P*     Copy of Inland Steel Industries Terminated Retirement
           Plan for Non-Employee Directors. (Filed as Exhibit
           10.M to the Company's Annual Report on Form 10-K for
           the fiscal year ended December 31, 1995, and incorpo-
           rated by reference herein.)                                  --
</TABLE>

--------
*  Management contract or compensatory plan or arrangement required to be
   filed as an exhibit to the Company's Annual Report on Form 10-K.


                                      iii
<PAGE>

<TABLE>
<CAPTION>
                                                                    SEQUENTIAL
  EXHIBIT                                                              PAGE
  NUMBER                    DOCUMENT DESCRIPTION                      NUMBER
  -------                   --------------------                    ----------
 <C>       <S>                                                      <C>
 10.Q*     Copy of Inland Steel Industries, Inc. Deferred Phantom
           Stock Unit Plan for Non-Employee Directors. (Filed as
           Exhibit 10.N to the Company's Annual Report on Form
           10-K for the fiscal year ended December 31, 1995, and
           incorporated by reference herein.)                           --
 10.R*     Copy of Outside Directors Accident Insurance Policy.
           (Filed as Exhibit 10-F to Inland Steel Company's An-
           nual Report on Form 10-K for the fiscal year ended De-
           cember 31, 1983, and incorporated by reference here-
           in.)                                                         --
 10.S.(1)* Copy of form of Severance Agreement, dated March 27,
           1996, between the Company and each of the four execu-
           tive officers of the Company identified on the exhibit
           relating to terms and conditions of termination of em-
           ployment following a change in control of the Company.
           (Filed as Exhibit 10.A to the Company's Quarterly Re-
           port on Form 10-Q for the quarter ended March 31,
           1996, and incorporated by reference herein.)                 --
 10.S(2)*  Amended listing of executive officers of the Company
           who are parties to the form of Severance Agreement
           dated March 27, 1996 in Exhibit 10.S.(1) hereof.......
 10.S.(3)* Copy of form of Change in Control Agreements dated
           March 27, 1996 between the Company and the parties
           listed on the schedule thereto. (Filed as Exhibit 10.5
           to the Ryerson Tull, Inc. Form S-1 Registration State-
           ment No. 333-3235, and incorporated by reference here-
           in.)                                                         --
 10.S.(4)* Copy of Form of Change in Control Agreements dated as
           of June 10, 1996 between Ryerson Tull, Inc. and the
           parties listed on the Schedule thereto. (Filed as Ex-
           hibit 10.7 to the Ryerson Tull, Inc. Registration
           Statement on Form S-1 (File No. 333-3235), and incor-
           porated by reference herein.)                                --
 10.S.(5)* Copy of Change in Control Agreement dated as of June
           10, 1996 between Ryerson Tull, Inc. and Neil S.
           Novich. (Filed as Exhibit 10.8 to the Ryerson Tull,
           Inc. Registration Statement on Form S-1 (File No. 333-
           3235), and incorporated by reference herein.)                --
 10.S.(6)* Change in Control Agreement dated as of March 27, 1996
           between the Company and Neil S. Novich. (Filed as Ex-
           hibit 10.6 to the Ryerson Tull, Inc. Form S-1 Regis-
           tration Statement No. 333-3235, and incorporated by
           reference herein.)                                           --
 10.S.(7)* Copy of Severance Agreement dated June 28, 1989 be-
           tween the Company and Judd R. Cool. (Filed as Exhibit
           10-0-(2) to the Company's Annual Report on Form 10-K
           for the fiscal year ended December 31, 1989, and in-
           corporated by reference herein.)                             --
 10.T.*    Copy of Employment Agreement dated as of April 8, 1994
           between the Company and Neil S. Novich. (Filed as Ex-
           hibit 10.N.(8) to the Company's Annual Report on Form
           10-K for the fiscal year ended December 31, 1994, and
           incorporated by reference herein.)                           --
 10.U.*    Copy of Assumption and Amendment Agreement dated July
           24, 1996 by and among Inland Steel Industries, Inc.,
           Ryerson Tull, Inc. and Neil S. Novich. (Filed as Ex-
           hibit 10.A to the Company's Quarterly Report on Form
           10-Q for the quarter ended September 30, 1996, and in-
           corporated by reference herein.)                             --
 10.V.(1)* Copy of Employment Agreement between the Company and
           Carl G. Lusted, dated June 27, 1990. (Filed as Exhibit
           10.4 to Ryerson Tull, Inc.'s Registration Statement on
           Form S-1 (File No. 333-3235), and incorporated by ref-
           erence herein.)                                              --
 10.V.(2)* Copy of Assumption and Amendment Agreement dated Janu-
           ary 22, 1997 by and among the Company, Ryerson Tull,
           Inc. and Carl G. Lusted. (Filed as Exhibit 10.6 to the
           Ryerson Tull, Inc. Annual Report on Form 10-K for the
           fiscal year ended December 31, 1996, and incorporated
           by reference herein.)                                        --
</TABLE>

--------
*  Management contract or compensatory plan or arrangement required to be
   filed as an exhibit to the Company's Annual Report on Form 10-K.


                                      iv
<PAGE>

<TABLE>
<CAPTION>
                                                                    SEQUENTIAL
  EXHIBIT                                                              PAGE
  NUMBER                    DOCUMENT DESCRIPTION                      NUMBER
  -------                   --------------------                    ----------
 <C>       <S>                                                      <C>
 10.W.(1)* Copy of letter to Judd R. Cool dated September 2, 1987
           relating to terms and conditions of employment. (Filed
           as Exhibit 10-K to the Company's Annual Report on Form
           10-K for the fiscal year ended December 31, 1987, and
           incorporated by reference herein.)                           --
 10.W.(2)* Copy of letter agreement dated November 23, 1987 be-
           tween the Company and Judd R. Cool. (Filed as Exhibit
           10-L to the Company's Annual Report on Form 10-K for
           the fiscal year ended December 31, 1987, and incorpo-
           rated by reference herein.)                                  --
 10.W.(3)* Copy of letter agreement dated December 10, 1993 be-
           tween the Company and Judd R. Cool restating certain
           provisions of the September 2, 1987 and November 23,
           1987 letters in Exhibits 10.S.(1) and (2). (Filed as
           Exhibit 10.P.(3) to the Company's Annual Report on
           Form 10-K for the fiscal year ended December 31, 1993,
           and incorporated by reference herein.)                       --
 10.X*     Copy of letter to H. William Howard dated July 17,
           1990 relating to terms and conditions of employment.
           (Filed as Exhibit 10-P to the Company's Annual Report
           on Form 10-K for the fiscal year ended December 31,
           1990, and incorporated by reference herein.)                 --
 10.Y      Copy of Stock Purchase Agreement, dated as of July 7,
           1989, between the Company and Harris Trust and Savings
           Bank, as ESOP Trustee. (Filed as Exhibit 4-G to the
           Company's Quarterly Report on Form 10-Q for the quar-
           ter ended June 30, 1989, and incorporated by reference
           herein.)                                                     --
 10.Z.(1)  Copy of Letter Agreement dated December 18, 1989 among
           the Company, Nippon Steel Corporation and NS Finance
           III, Inc. (an indirectly wholly owned subsidiary of
           Nippon Steel Corporation) relating to sale to NS Fi-
           nance III, Inc. of 185,000 shares of Series F Ex-
           changeable Preferred Stock of the Company. (Filed as
           Exhibit 4(b) to the Company's Current Report on Form
           8-K filed on December 18, 1989, and incorporated by
           reference herein.)                                           --
 10.Z.(2)  Copy of Steel Technology Agreement dated as of July
           14, 1989 between Inland Steel Company and Nippon Steel
           Corporation relating to technology sharing between the
           signatories. (Filed as Exhibit 10-S-(2) to the
           Company's Annual Report on Form 10-K for the fiscal
           year ended December 31, 1989, and incorporated by ref-
           erence herein.)                                              --
 10.Z.(3)  Copy of Basic Agreement dated as of July 21, 1987 be-
           tween the Company and Nippon Steel Corporation relat-
           ing to the I/N Tek joint venture. (Filed as Exhibit
           10-S-(3) to the Company's Annual Report on Form 10-K
           for the fiscal year ended December 31, 1989, and in-
           corporated by reference herein.)                             --
 10.Z.(4)  Copy of Partnership Agreement dated as of July 21,
           1987 between ISC Tek, Inc. (an indirectly wholly owned
           subsidiary of the Company) and NS Tek, Inc. (an indi-
           rectly wholly owned subsidiary of Nippon Steel Corpo-
           ration) relating to the I/N Tek joint venture. (Filed
           as Exhibit 10-S-(4) to the Company's Annual Report on
           Form 10-K for the fiscal year ended December 31, 1989,
           and incorporated by reference herein.)                       --
 10.Z.(5)  Copy of Basic Agreement dated as of September 12, 1989
           between the Company and Nippon Steel Corporation re-
           lating to the I/N Kote joint venture. (Filed as Ex-
           hibit 10-S-(5) to the Company's Annual Report on Form
           10-K for the fiscal year ended December 31, 1989, and
           incorporated by reference herein.)                           --
</TABLE>

--------
*  Management contract or compensatory plan or arrangement required to be
   filed as an exhibit to the Company's Annual Report on Form 10-K.


                                       v
<PAGE>

<TABLE>
<CAPTION>
                                                                    SEQUENTIAL
  EXHIBIT                                                              PAGE
  NUMBER                    DOCUMENT DESCRIPTION                      NUMBER
  -------                   --------------------                    ----------
 <C>       <S>                                                      <C>
 10.Z.(6)  Copy of Partnership Agreement dated as of September
           12, 1989 between ISC Kote, Inc. (an indirectly wholly
           owned subsidiary of the Company) and NS Tek, Inc. (an
           indirectly wholly owned subsidiary of Nippon Steel
           Corporation) relating to the I/N Kote joint venture.
           (Filed as Exhibit 10-S-(6) to the Company's Annual Re-
           port on Form 10-K for the fiscal year ended December
           31, 1989, and incorporated by reference herein.)             --
 10.Z.(7)  Copy of Substrate Supply Agreement dated as of Septem-
           ber 12, 1989 between Inland Steel Company and I/N
           Kote, an Indiana general partnership. (Filed as Ex-
           hibit 10-S-(7) to the Company's Annual Report on Form
           10-K for the fiscal year ended December 31, 1989, and
           incorporated by reference herein.)                           --
 10.Z.(8)  Copy of First Amendment to Substrate Supply Agreement
           dated as of May 1, 1990 between Inland Steel Company
           and I/N Kote relating to the I/N Kote joint venture.
           (Filed as Exhibit
           10-R-(8) to the Company's Annual Report on Form 10-K
           for the fiscal year ended December 31, 1990, and in-
           corporated by reference herein.)                             --
 10.Z.(9)  Copy of Letter Agreement dated as of May 1, 1990 among
           I/N Kote, the Company and Nippon Steel Corporation re-
           lating to partner loans. (Filed as Exhibit 10-R-(9) to
           the Company's Annual Report on Form 10-K for the fis-
           cal year ended December 31, 1990, and incorporated by
           reference herein.)                                           --
 10.Z.(10) Copy of First Amendment to I/N Kote Basic Agreement
           dated as of May 1, 1990 between the Company and Nippon
           Steel Corporation relating to the I/N Kote joint ven-
           ture. (Filed as Exhibit 10-R-(10) to the Company's An-
           nual Report on Form 10-K for the fiscal year ended De-
           cember 31, 1990, and incorporated by reference here-
           in.)                                                         --
 10.Z.(11) Copy of Letter Agreement dated as of April 19, 1990
           between the Company and Nippon Steel Corporation re-
           lating to capital contributions to I/N Tek. (Filed as
           Exhibit 10-R-(11) to Company's Annual Report on Form
           10-K for the fiscal year ended December 31, 1990, and
           incorporated by reference herein.)                           --
 10.Z.(12) Copy of Letter Agreement dated April 20, 1990 between
           ISC Tek, Inc. (an indirectly wholly owned subsidiary
           of the Company) and NS Tek, Inc. (an indirectly wholly
           owned subsidiary of Nippon Steel Corporation) relating
           to amendment of the partnership agreement of I/N Tek.
           (Filed as Exhibit 10-R-(12) to the Company's Annual
           Report on Form 10-K for the fiscal year ended December
           31, 1990, and incorporated by reference herein.)             --
 10.Z.(13) Copy of CCM Override Amendment dated as of April 20,
           1990 among the Company; Nippon Steel Corporation; In-
           land Steel Company; ISC Tek, Inc.; I/N Tek; NS Sales,
           Inc.; and NS Tek, Inc. relating to I/N Tek. (Filed as
           Exhibit 10-R-(13) to the Company's Annual Report on
           Form 10-K for the fiscal year ended December 31, 1990,
           and incorporated by reference herein.)                       --
 10.AA     Copy of Inland Steel Industries Thrift Plan ESOP
           Trust, dated July 7, 1989, between the Company and
           Harris Trust and Savings Bank, as ESOP Trustee. (Filed
           as Exhibit 10-P to the Company's Quarterly Report on
           Form 10-Q for the quarter ended June 30, 1989, and in-
           corporated by reference herein.)                             --
 10.BB     Copy of First Amendment dated July 1, 1996 between the
           Company and LaSalle National Trust, N.A. as Successor
           ESOP Trustee, to the Inland Steel Industries Thrift
           Plan ESOP Trust, dated July 7, 1989, between the Com-
           pany and Harris Trust and Savings Bank, as ESOP Trust-
           ee....................................................
</TABLE>

                                       vi
<PAGE>

<TABLE>
<CAPTION>
                                                                    SEQUENTIAL
  EXHIBIT                                                              PAGE
  NUMBER                    DOCUMENT DESCRIPTION                      NUMBER
  -------                   --------------------                    ----------
 <C>       <S>                                                      <C>
 10.CC     Copy of Letter Agreement dated March 1, 1991 between
           Nippon Steel Corporation and the Company regarding Se-
           ries F Exchangeable Preferred Stock. (Filed as Exhibit
           10-U to the Company's Annual Report on Form 10-K for
           the fiscal year ended December 31, 1990, and incorpo-
           rated by reference herein.)                                  --
 10.DD     Copy of Letter Agreement dated May 10, 1991 by and be-
           tween Nippon Steel Corporation and the Company relat-
           ing to Letter Agreement dated December 18, 1989.
           (Filed as Exhibit 10-V to the Company's Quarterly Re-
           port on Form 10-Q for the quarter ended March 31,
           1991, and incorporated by reference herein.)                 --
 11        Statement of Earnings per Share of Common Stock.......
 13        Information incorporated by reference from Annual Re-
           port to Stockholders for the fiscal year ended Decem-
           ber 31, 1996..........................................
 21        List of certain subsidiaries of the Company...........
 23        Consent of Independent Accountants, appearing on page
           30 of this Annual Report on Form 10-K                        --
 24        Powers of attorney....................................
 27        Financial Data Schedules..............................
 99        Letter to stockholders of common stock of the Company
           dated December 22, 1987 explaining Stockholder Rights
           Plan adopted by Board of Directors on November 25,
           1987. (Filed as Exhibit 3 to the Company's Current Re-
           port on Form 8-K filed on December 18, 1987, and in-
           corporated by reference herein.)                             --
</TABLE>

                                      vii