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                                  EXHIBIT 11.1

                             NOVAMERICAN STEEL INC.

                       CODE OF BUSINESS CONDUCT AND ETHICS


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Introduction

This Code of Business Conduct and Ethics (the "CODE") applies to all
employees, officers and directors of Novamerican Steel Inc. and its
subsidiaries (collectively the "CORPORATION"). It covers a wide range of
business practices and procedures. It does not cover every issue that may
arise, but it sets out basic principles to guide all employees, officers and
directors (collectively the "EMPLOYEES") of the Corporation. All of the
Corporation's Employees must conduct themselves accordingly and seek to avoid
even the appearance of improper behavior. The Code should also be provided to
the Corporation's agents and representatives, including consultants, as they
are equally expected to comply with this Code in all their dealings with or
on behalf of the Corporation.

The purpose of this document is to maintain the reputation earned by the
Corporation for integrity, objectivity and impartiality, by establishing
guidelines to help promote honesty, confidentiality, proper conduct and
avoidance of conflicts of interest.

Those who violate the standards in this Code will be subject to disciplinary
action.

1. COMPLIANCE WITH LAWS AND REGULATIONS

Obeying the law, both in letter and in spirit, is the foundation on which this
Corporation's ethical standards are built. All Employees must respect and obey
the applicable laws and regulations of Canada and the USA and their respective
provinces and states. Although not all Employees are expected to know the
details of these laws and regulations, it is important to know enough to
determine when to seek advice from supervisors, managers or other appropriate
personnel.

2. CONFLICTS OF INTEREST

Conflicts of Interest are prohibited as a matter of Corporation policy. A
"conflict of interest" exists when a person's personal or business interests or
the interests of a related person interfere in any way with the interests of the
Corporation. A conflict situation can arise when an Employee takes actions or
has interests that may make it difficult to perform his or her Corporation work
objectively, effectively, free from bias and in the best interest of the
Corporation. Conflicts of interest may also arise when an Employee or members of
his or her family, receives personal benefits, entertainment or gifts of more
than nominal value as a result of his or her position in the Corporation.

It is almost always a conflict of interest for a Corporation Employee to work
simultaneously for a competitor, customer or supplier. Employees are not allowed
to work for a competitor as a



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consultant or board member. The best policy is to avoid any direct or indirect
business connection with the Corporation's customers, suppliers or competitors,
except on behalf of the Corporation.

Conflicts of interest may not always be clear-cut, so if you have a question,
you should consult with higher levels of management or the Corporation's
legal counsel. Any Employee who becomes aware of a conflict or potential
conflict should bring it to the attention of a supervisor, manager or other
appropriate personnel.

3. INSIDER TRADING

Employees who have access to confidential information are not permitted to
use or share that information for stock trading purposes or for any other
purpose except the conduct of the Corporation's business. All non-public
information about the Corporation, its financial condition, earnings or
business, or any important development, should be considered confidential
information until a reasonable time after public disclosure of such inside
information. To use non-public information for personal financial benefit or
to "tip" others including family and friends who might make an investment
decision on the basis of this information is not only unethical but also
illegal. The consequences of insider trading can be severe as noted in the
Corporation's insider trading policy. If you have any questions, please
consult the Corporation's legal counsel.

4. CORPORATE OPPORTUNITIES

Employees are prohibited from taking for themselves personally opportunities
that are discovered through the use of corporate property, information or
position without the consent of the Board of Directors. No Employee may use
corporate property, information, or position for improper personal gain, and
no Employee may compete with the Corporation directly or indirectly.
Employees owe a duty to the Corporation to advance its legitimate interests
when the opportunity to do so arises.

5. COMPETITION AND FAIR DEALING

The Corporation strives to outperform its competition fairly and honestly.
The Corporation seeks competitive advantages through superior performance,
never through unethical or illegal business practices. Stealing proprietary
information, possessing trade secret information that was obtained without
the owner's consent, or inducing such disclosures by past or present
employees of other companies is prohibited. Each Employee should endeavor to
respect the rights of and deal fairly with the Corporation's customers,
suppliers, competitors and Employees. No Employee should take unfair
advantage of anyone through manipulation, concealment, abuse of privileged
information, misrepresentation of material facts, or any other intentional
unfair-dealing practice.

The purpose of business entertainment and gifts in a commercial setting is to
create good will and sound working relationships, not to gain unfair advantage
with customers. No gift or entertainment should ever be offered, given, provided
or accepted by any Corporation



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Employee, family member of an Employee or agent unless it: (1) is not a cash
gift, (2) is consistent with customary business practices, (3) is not excessive
in value, (4) cannot be construed as a bribe or payoff and (5) does not violate
any laws or regulations. Please discuss with your supervisor any proposed gifts
or entertainment which you are not certain are appropriate.

6. DISCRIMINATION AND HARASSMENT

The diversity of the Corporation's Employees is a significant asset. The
Corporation is firmly committed to providing equal opportunity in all aspects of
employment and will not tolerate any forms of discrimination or harassment
against or from any group or individual, whether on the basis of race, color,
religion, national or ethnic origin, age, gender, sexual orientation, marital
status, physical or mental disability, or on the basis of any other personal
characteristics protected by law. Examples include inappropriate language,
coercion or intimidation in the workplace and unwelcome sexual advances.

7. HEALTH AND SAFETY

The Corporation strives to provide each Employee with a safe and healthy work
environment. Each Employee has responsibility for maintaining a safe and healthy
workplace for all Employees by following safety and health rules and practices
and reporting accidents, injuries and unsafe equipment, practices or conditions.

Drug and alcohol use threatens the safety and productivity of the work
environment. Employees should report to work in condition to perform their
duties, free from the influence of illegal drugs or alcohol. Being under the
influence of illegal drugs or alcohol in the workplace will not be tolerated and
will subject Employees to disciplinary action up to and including immediate
termination of employment.

8. BOOKS AND RECORDS

The Corporation requires honest and accurate recording and reporting of
information in order to make responsible business decisions.

All of the Corporation's books, records, accounts and financial statements must
be maintained in reasonable detail, must accurately and properly reflect the
Corporation's transactions and must conform both to applicable legal
requirements and generally accepted accounting principles and to the
Corporation's system of internal controls. Unrecorded or "off the books" funds
or assets should not be maintained unless permitted by applicable law or
regulation.

As far as possible, contracts to which the Corporation is a party should be in
writing. "Side Letters" or "comfort letters" that are not referred to in the
main document should only be used with the advice of the Corporation's legal
counsel.

Business records and communications often become public, and Employees should
avoid exaggeration, derogatory remarks, guesswork, or inappropriate
characterizations of people and companies that can be misunderstood. This
applies equally to e-mail, internal memos, and formal reports. Records should
always be retained or destroyed according to the Corporation's record
retention

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policies. In accordance with those policies, in the event of litigation or
governmental investigation, please consult the Corporation's legal counsel.

Many Employees regularly use business expense accounts, which must be documented
and recorded accurately. If you are not sure whether a certain expense is
legitimate, ask your supervisor or your controller. Rules and guidelines are
available from your controller.

9. CONFIDENTIALITY

Employees must maintain the confidentiality of confidential information
entrusted to them by the Corporation or its customers, except when disclosure is
authorized by the Corporation's legal counsel or required by laws or
regulations. Confidential information includes all non-public information that
might be of use to competitors, or harmful to the Corporation or its customers,
if disclosed. It also includes information that suppliers and customers have
entrusted to the Corporation. The obligation to preserve confidential
information continues even after employment ends.

10. PROTECTION AND PROPER USE OF CORPORATION ASSETS

All Employees should endeavor to protect and preserve the Corporation's assets
and ensure their efficient use. Theft, carelessness, and waste have a direct
impact on the Corporation's profitability. Any suspected incident of fraud or
theft should be immediately reported for investigation.

The obligation of Employees to protect the Corporation's assets includes its
proprietary information such as trade secrets, patents, trademarks, and
copyrights, as well as business, marketing and service plans, engineering and
manufacturing ideas, designs, databases, records, salary information and any
unpublished financial data and reports. Unauthorized use or distribution of this
information would violate Corporation policy. It could also be illegal and
result in civil or even criminal penalties.

11. IMPROPER PAYMENTS TO GOVERNMENT PERSONNEL

The Canadian Corruption of Foreign Public Officials Act and the U.S. Foreign
Corrupt Practices Act prohibit giving anything of value, directly or indirectly,
to officials of foreign governments or foreign political candidates in order to
obtain or retain business. It is strictly prohibited to make illegal payments to
government officials of any country.

In addition, the Canadian and U.S. governments have a number of laws and
regulations regarding business gratuities, which may be accepted by government
personnel. The promise, offer or delivery to an official or employee of the
Canadian or U.S. government of a gift, favor or other gratuity in violation of
these rules would not only violate Corporation policy but could also be a
criminal offense. Provincial, state and local governments, as well as foreign
governments, may have similar rules. The Corporation's legal counsel can provide
guidance in this area.


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12. WAIVERS OF THE CODE OF BUSINESS CONDUCT AND ETHICS

Any waiver of this Code for Employees may be made only by the Board or a
Board committee and will be promptly disclosed as required by law or stock
exchange regulation.

13. REPORTING ANY ILLEGAL OR UNETHICAL BEHAVIOR

Employees are encouraged to speak to supervisors, managers or other appropriate
personnel about observed illegal or unethical behavior and when in doubt about
the best course of action in a particular situation. It is the policy of the
Corporation not to allow retaliation for reports of misconduct by others made in
good faith by Employees. Depending upon the nature of the misconduct, the
Corporation may have the legal obligation to report it to the appropriate
authorities. Employees are expected to cooperate in internal investigations of
misconduct.


Dated: February 25, 2004