SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q


 X       QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
---
         EXCHANGE ACT OF 1934

For the quarterly period March 31, 2000
                         --------------

Commission file number 1-3919
                       ------


                    Keystone Consolidated Industries, Inc.
------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


          Delaware                                                37-0364250
---------------------------------------------                 ------------------
(State or other jurisdiction of                                (I.R.S. Employer
 incorporation or organization)                              Identification No.)

 5430 LBJ Freeway, Suite 1740, Three Lincoln Centre, Dallas, TX   75240-2697
(Address of principal executive offices)                          (Zip Code)


Registrant's telephone number, including area code:        (972) 458-0028
                                                        ---------------------

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by  Sections  13 or 15(d)  of the  Securities  Exchange  Act of 1934
during  the  preceding  12  months,  and (2) has  been  subject  to such  filing
requirements for the past 90 days.

                           Yes   X                            No _____
                               -----

Number of shares of common stock outstanding at May 11, 2000:  10,061,969


<PAGE>


                     KEYSTONE CONSOLIDATED INDUSTRIES, INC.
                                AND SUBSIDIARIES

                                      INDEX

                                                                          Page
                                                                         Number

PART I.        FINANCIAL INFORMATION

  Item 1.  Financial Statements

           Consolidated Balance Sheets - December 31, 1999
             and March 31, 2000                                             3-4

           Consolidated Statements of Operations - Three months
             ended March 31, 1999 and 2000                                    5

           Consolidated Statements of Cash Flows - Three months
             ended March 31, 1999 and 2000                                    6

           Consolidated Statement of Stockholders' Equity -
             Three months ended March 31, 2000                                7

           Notes to Consolidated Financial Statements                      8-12

  Item 2.  Management's Discussion and Analysis of Financial
             Condition and Results of Operations                          13-18


PART II. OTHER INFORMATION


  Item 1.  Legal Proceedings                                                 19

  Item 6.  Exhibits and Reports on Form 8-K                                  19



<PAGE>


                     KEYSTONE CONSOLIDATED INDUSTRIES, INC.
                                AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS

                                 (In thousands)
<TABLE>
<CAPTION>


                                                         December 31, March 31,
                                   ASSETS                   1999        2000
                                                         -----------  ---------

Current assets:
<S>                                                        <C>          <C>
  Notes and accounts receivable ......................     $ 32,010     $ 49,371
  Receivable from Alter Recycling Company, L.L.C .....          809          833
  Inventories ........................................       66,083       60,135
  Deferred income taxes ..............................       17,396       17,025
  Prepaid expenses and other .........................        1,364        1,143
                                                           --------     --------

     Total current assets ............................      117,662      128,507
                                                           --------     --------

Property, plant and equipment ........................      357,877      358,869
Less accumulated depreciation ........................      207,721      210,645
                                                           --------     --------

     Net property, plant and equipment ...............      150,156      148,224
                                                           --------     --------

Other assets:
  Restricted investments .............................        9,180        9,310
  Prepaid pension cost ...............................      126,126      126,862
  Deferred financing costs ...........................        3,034        3,023
  Goodwill ...........................................        1,002          971
  Deferred income taxes ..............................         --            582
  Investment in Alter Recycling Company L.L.C ........          281          250
  Other ..............................................        3,477        3,341
                                                           --------     --------

     Total other assets ..............................      143,100      144,339
                                                           --------     --------

                                                           $410,918     $421,070
                                                           ========     ========
</TABLE>

<PAGE>



                     KEYSTONE CONSOLIDATED INDUSTRIES, INC.
                                AND SUBSIDIARIES

                     CONSOLIDATED BALANCE SHEETS (CONTINUED)

                                 (In thousands)
<TABLE>
<CAPTION>



       LIABILITIES AND STOCKHOLDERS' EQUITY
                                                      December 31,    March 31,
                                                         1999            2000
                                                      -----------     ---------

Current liabilities:
<S>                                                    <C>            <C>
  Notes payable and current maturities of
    long-term debt ...............................     $  45,986      $  58,036
  Accounts payable ...............................        30,689         37,374
  Accounts payable to affiliates .................            70           --
  Accrued OPEB cost ..............................         9,500          9,500
  Other accrued liabilities ......................        45,337         40,248
                                                       ---------      ---------

      Total current liabilities ..................       131,582        145,158
                                                       ---------      ---------

Noncurrent liabilities:
  Long-term debt .................................       100,871        100,525
  Accrued OPEB cost ..............................        98,802         98,383
  Deferred income taxes ..........................         1,100           --
  Negative goodwill ..............................        22,709         22,370
  Other ..........................................         9,539          9,448
                                                       ---------      ---------

      Total noncurrent liabilities ...............       233,021        230,726
                                                       ---------      ---------

Minority interest ................................          --                9
                                                       ---------      ---------

Stockholders' equity:
  Common stock ...................................        10,656         10,790
  Additional paid-in capital .....................        52,398         53,058
  Accumulated deficit ............................       (16,727)       (18,659)
  Treasury stock, at cost ........................           (12)           (12)
                                                       ---------      ---------

      Total stockholders' equity .................        46,315         45,177
                                                       ---------      ---------

                                                       $ 410,918      $ 421,070
                                                       =========      =========
</TABLE>


<PAGE>


                     KEYSTONE CONSOLIDATED INDUSTRIES, INC.
                                AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS

                      (In thousands, except per share data)

<TABLE>
<CAPTION>

                                                           Three months ended
                                                               March 31,
                                                           ------------------
                                                            1999         2000
                                                            ----         ----

Revenues and other income:
<S>                                                       <C>         <C>
  Net sales ...........................................   $ 91,717    $ 96,422
  Interest ............................................         82         126
  Other, net ..........................................        121          22
                                                          --------    --------
                                                            91,920      96,570
                                                          --------    --------
Costs and expenses:
  Cost of goods sold ..................................     83,663      89,981
  Selling .............................................      1,803       1,800
  General and administrative ..........................      6,081       5,024
  Overfunded defined benefit pension credit ...........     (2,500)       (736)
  Interest ............................................      3,516       3,713
                                                          --------    --------
                                                            92,563      99,782
                                                          --------    --------

                                                              (643)     (3,212)

    Equity in losses of Alter Recycling Company L.L.C .       --           (31)
                                                          --------    --------

      Loss before income taxes ........................       (643)     (3,243)

Income tax benefit ....................................       (295)     (1,320)

Minority interest in after-tax earnings ...............       --             9
                                                          --------    --------

    Net loss ..........................................   $   (348)   $ (1,932)
                                                          ========    ========

Net loss per share:
  Basic ...............................................   $   (.04)   $   (.19)
                                                          ========    ========
  Diluted .............................................   $   (.04)   $   (.19)
                                                          ========    ========

Weighted average common and common equivalent
  shares outstanding:
  Basic ...............................................      9,838       9,971
                                                          ========    ========
  Diluted .............................................      9,838       9,971
                                                          ========    ========
</TABLE>



<PAGE>


                     KEYSTONE CONSOLIDATED INDUSTRIES, INC.
                                AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In thousands)

<TABLE>
<CAPTION>

                                                           Three months ended
                                                               March 31,
                                                           ------------------
                                                            1999         2000
                                                            ---          ----

Cash flows from operating activities:
<S>                                                       <C>         <C>
  Net loss ............................................   $   (348)   $ (1,932)
  Depreciation and amortization .......................      5,853       4,558
  Amortization of deferred financing costs ............        130         119
  Deferred income taxes ...............................      2,249      (1,310)
  Other, net ..........................................       (443)       (302)
  Change in assets and liabilities:
    Accounts receivable ...............................    (12,436)    (17,478)
    Inventories .......................................      1,345       5,948
    Prepaid pension cost ..............................     (2,500)       (736)
    Accounts payable ..................................     (3,797)      6,615
    Other, net ........................................     (3,984)     (4,194)
                                                          --------    --------

      Net cash used by operating activities ...........    (13,931)     (8,712)
                                                          --------    --------

Cash flows from investing activities:
  Capital expenditures ................................     (6,537)     (2,910)
  Other, net ..........................................       (151)        (82)
                                                          --------    --------

      Net cash used by investing activities ...........     (6,688)     (2,992)
                                                          --------    --------

Cash flows from financing activities:
  Revolving credit facilities, net ....................     21,074      12,192
  Other notes payable and long-term debt:
    Additions .........................................        103          17
    Principal payments ................................       (558)       (505)
                                                          --------    --------

      Net cash provided by financing activities .......     20,619      11,704
                                                          --------    --------

Net change in cash and cash equivalents ...............       --          --

Cash and cash equivalents, beginning of period ........       --          --
                                                          --------    --------

Cash and cash equivalents, end of period ..............   $   --      $   --
                                                          ========    ========

Supplemental disclosures:
  Cash paid for:
    Interest, net of amount capitalized ...............   $  5,840    $  6,039
    Income taxes ......................................        673          28

  Common stock contributed to employee benefit plan ...   $    722    $    794

</TABLE>


<PAGE>


                     KEYSTONE CONSOLIDATED INDUSTRIES, INC.
                                AND SUBSIDIARIES

                 CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY

                        Three months ended March 31, 2000
                                 (In thousands)

<TABLE>
<CAPTION>

                                         Additional
                               Common      paid-in  Accumulated Treasury
                               Stock       capital    deficit     stock       Total
                              -------    ---------  ----------  ---------   --------

<S>                           <C>        <C>        <C>         <C>         <C>
Balance - December 31, 1999   $ 10,656   $ 52,398   $(16,727)   $    (12)   $ 46,315

Net loss ..................       --         --       (1,932)       --        (1,932)

Issuance of common stock ..        134        660       --          --           794
                              --------   --------   --------    --------    --------

Balance - March 31, 2000 ..   $ 10,790   $ 53,058   $(18,659)   $    (12)   $ 45,177
                              ========   ========   ========    ========    ========

</TABLE>




<PAGE>





                     KEYSTONE CONSOLIDATED INDUSTRIES, INC.
                                AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1 - Organization and basis of presentation:

         The consolidated  balance sheet at December 31, 1999 has been condensed
from the Company's audited  consolidated  financial statements at that date. The
consolidated balance sheet at March 31, 2000 and the consolidated  statements of
operations and cash flows for the interim periods ended March 31, 1999 and 2000,
and the consolidated  statement of  stockholders'  equity for the interim period
ended March 31, 2000, have each been prepared by the Company,  without audit. In
the opinion of management, all adjustments,  consisting only of normal recurring
adjustments,  necessary to present fairly the consolidated  financial  position,
results of  operations  and cash flows  have been  made.  However,  it should be
understood  that  accounting  measurements  at interim dates may be less precise
than at year end.  The results of  operations  for the  interim  periods are not
necessarily  indicative  of the  operating  results for a full year or of future
operations.

         Certain information  normally included in financial statements prepared
in accordance with generally accepted  accounting  principles has been condensed
or omitted. The accompanying consolidated financial statements should be read in
conjunction with the consolidated financial statements included in the Company's
Annual  Report on Form 10-K for the year ended  December  31, 1999 (the  "Annual
Report").

         At March 31, 2000, Contran  Corporation  ("Contran") and other entities
related to Mr.  Harold C. Simmons,  beneficially  own  approximately  50% of the
Company.  Substantially all of Contran's outstanding voting stock is held either
by trusts  established for the benefit of certain children and  grandchildren of
Mr. Simmons,  of which Mr. Simmons is sole trustee,  or by Mr. Simmons directly.
The Company may be deemed to be controlled by Contran and Mr. Simmons.

         The Company  will adopt  Statement of  Financial  Accounting  Standards
("SFAS") No. 133, Accounting for Derivative  Instruments and Hedging Activities,
as amended,  no later than the first  quarter of 2001.  Under SFAS No. 133,  all
derivatives  will be recognized as either assets or liabilities  and measured at
fair value.  The accounting for changes in fair value of derivatives will depend
upon the intended use of the  derivative.  The impact on the Company of adopting
SFAS No. 133, if any, has not yet been determined but will be dependent upon the
extent  to which the  Company  is a party to  derivative  contracts  or  hedging
activities  covered  by  SFAS  No.  133  at  the  time  of  adoption,  including
derivatives  embedded in  non-derivative  host  contracts.  As  permitted by the
transition  requirements of SFAS No. 133, as amended,  Keystone will exempt from
the scope of SFAS No. 133 all host  contracts  containing  embedded  derivatives
which were acquired or issued prior to January 1, 1999.




<PAGE>


Note 2 - Inventories:

         Inventories are stated at the lower of cost or market.  At December 31,
1999 and March 31, 2000,  the  last-in,  first-out  ("LIFO")  method was used to
determine the cost of approximately  79% of total  inventories and the first-in,
first-out  or  average  cost  methods  was used to  determine  the cost of other
inventories.

<TABLE>
<CAPTION>

                                                           December 31,  March 31,
                                                               1999        2000
                                                           ------------  ---------
                                                               (In thousands)

Raw materials -
<S>                                                            <C>       <C>
  Steel and wire products ..................................   $20,985   $17,038
                                                               -------   -------

Work in process -
  Steel and wire products ..................................    12,657    10,252
                                                               -------   -------

Finished products:
  Steel and wire products ..................................    20,179    19,070
  Lawn and garden products .................................     5,595     4,381
                                                               -------   -------
                                                                25,774    23,451
                                                               -------   -------
Supplies -
  Steel and wire products ..................................    15,378    18,105
                                                               -------   -------

                                                                74,794    68,846

Less LIFO reserve -
  Steel and wire products ..................................     8,711     8,711
                                                               -------   -------
                                                               $66,083   $60,135
                                                               =======   =======

</TABLE>

Note 3 - Notes payable and long-term debt:

<TABLE>
<CAPTION>

                                                           December 31,  March 31,
                                                              1999          2000
                                                           ------------  ---------
                                                                (In thousands)

<S>                                                          <C>        <C>
9 5/8% Senior Secured Notes, due August 2007 .............   $100,000   $100,000
Commercial credit agreements:
  Revolving credit facilities:
    Keystone .............................................     35,568     47,812
    EWP ..................................................      4,908      4,397
    Garden Zone ..........................................      3,541      4,000
  Term loan - EWP ........................................        437        292
Other ....................................................      2,403      2,060
                                                             --------   --------
                                                              146,857    158,561
  Less current maturities ................................     45,986     58,036
                                                             --------   --------

                                                             $100,871   $100,525
                                                             ========   ========

</TABLE>



<PAGE>


Note 4 - Income taxes:

         Summarized below are (i) the differences between the income tax benefit
and the amounts that would be expected using the U.S.  federal  statutory income
tax rate of 35%, and (ii) the components of the income tax benefit.

<TABLE>
<CAPTION>

                                                           Three months ended
                                                                March 31,
                                                          -------------------
                                                            1999       2000
                                                            ----       ----
                                                            (In thousands)

<S>                                                       <C>        <C>
Expected tax benefit, at statutory rate ...............   $  (225)   $(1,135)
U. S. state income taxes, net .........................        19        (73)
Amortization of goodwill ..............................      (109)      (108)
Other, net ............................................        20         (4)
                                                          -------    -------

Income tax benefit ....................................   $  (295)   $(1,320)
                                                          =======    =======

Comprehensive benefit for income taxes:
  Currently refundable:
    U.S. federal ......................................   $(2,307)   $   (10)
    U.S. state ........................................      (237)      --
                                                          -------    -------
      Net currently refundable ........................    (2,544)       (10)

  Deferred income taxes, net ..........................     2,249     (1,310)
                                                          -------    -------

                                                          $  (295)   $(1,320)
                                                          =======    =======
</TABLE>
Note 5 - Other accrued liabilities:
<TABLE>
<CAPTION>

                                                            December 31, March 31,
                                                                1999        2000
                                                            ----------------------
                                                                (In thousands)
Current:
<S>                                                            <C>       <C>
  Employee benefits ........................................   $13,181   $11,414
  Environmental ............................................    10,093    10,446
  Self insurance ...........................................     7,218     7,263
  Interest .................................................     4,034     1,591
  Disposition of former facilities .........................       617       595
  Legal and professional ...................................       829       750
  Accrued maintenance ......................................      --         813
  Other ....................................................     9,365     7,376
                                                               -------   -------

                                                               $45,337   $40,248
                                                               =======   =======
Noncurrent:
  Environmental ............................................   $ 8,143   $ 8,078
  Deferred gain ............................................       274       250
  Other ....................................................     1,122     1,120
                                                               -------   -------

                                                               $ 9,539   $ 9,448
                                                               =======   =======
</TABLE>

         Keystone generally  undertakes planned major maintenance  activities on
an annual  basis,  usually in the  fourth  quarter  of each  year.  These  major
maintenance  activities are conducted  during a shut-down of the Company's steel
and rod  mills.  Repair  and  maintenance  costs  estimated  to be  incurred  in
connection  with these  planned  major  maintenance  activities  are  accrued in
advance on a straight-line basis throughout the year and are included in cost of
goods sold.

Note 6 - Operations:

         The Company's operations are comprised of two segments; the manufacture
and  sale of  carbon  steel  rod,  wire  and  wire  products  for  agricultural,
industrial,  construction,  commercial,  original  equipment  manufacturers  and
retail consumer markets and the distribution of wire,  plastic and wood lawn and
garden products to retailers through Garden Zone.

         Beginning in August 1999, Keystone is also engaged in a scrap recycling
joint  venture  through  its 50%  interest  in  ARC,  an  unconsolidated  equity
affiliate.
<TABLE>
<CAPTION>

                                                           Three months ended
                                                            1999         2000
                                                            ---          ----
                                                             (In thousands)

Revenues:
<S>                                                       <C>         <C>
  Steel and wire products .............................   $ 89,848    $ 94,193
  Lawn and garden products ............................      3,029       2,261
                                                          --------    --------
                                                            92,877      96,454
  Elimination of intersegment revenues ................     (1,160)        (32)
                                                          --------    --------

                                                          $ 91,717    $ 96,422
                                                          ========    ========

Loss before income taxes:
  Operating profit:
    Steel and wire products ...........................   $  3,219    $    767
    Lawn and garden products ..........................       (156)        113
                                                          --------    --------
                                                             3,063         880

  Equity in loss of Alter Recycling Company, L.L.C ....       --           (31)

  General corporate items:
    Interest income ...................................         82         126
    General expense, net ..............................       (272)       (505)
  Interest expense ....................................     (3,516)     (3,713)
                                                          --------    --------

                                                          $   (643)   $ (3,243)
                                                          ========    ========
</TABLE>

Note 7 - Contingencies:

         At March 31, 2000, the Company's financial statements reflected accrued
liabilities  of  $18.5  million  for  estimated   remedial  costs  arising  from
environmental  issues.  There is no assurance  regarding  the  ultimate  cost of
remedial measures that might eventually be required by environmental authorities
or  that  additional   environmental   hazards,   requiring   further   remedial
expenditures,  might not be asserted  by such  authorities  or private  parties.
Accordingly,  the  ultimate  costs of remedial  measures  may exceed the amounts
currently accrued.

         For additional  information  related to commitments and  contingencies,
see "Management's  Discussion and Analysis of Financial Condition and Results of
Operations" and the Annual Report.



<PAGE>


MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS

RESULTS OF OPERATIONS:

         Keystone believes it is a leading manufacturer of steel fabricated wire
products, industrial wire and carbon steel rod for the agricultural, industrial,
construction,  original  equipment  manufacturer  and retail  consumer  markets.
Historically,  the Company has experienced  greater sales and profits during the
first  half of the  year due to the  seasonality  of  sales  in  principal  wire
products markets,  including the agricultural and construction markets. Keystone
is also engaged in the  distribution  of wire,  plastic and wood lawn and garden
products to retailers through its 51%-owned  subsidiary Garden Zone LLC ("Garden
Zone").

          Beginning in August 1999,  Keystone is also engaged in scrap recycling
through its  unconsolidated  50%  interest in Alter  Recycling  Company,  L.L.C.
("ARC").

         As  provided by the safe harbor  provisions  of the Private  Securities
Litigation  Reform Act of 1995, the Company cautions that the statements in this
Quarterly  Report on Form 10-Q relating to matters that are not historical facts
including,  but not limited to, statements found in this Management's Discussion
And  Analysis Of Financial  Condition  And Results Of  Operations",  are forward
looking statements that represent  management's  belief and assumptions based on
currently available information. Forward-looking statements can be identified by
the use of words such as "believes",  "intends", "may", "should", "anticipates",
"expected",  or  comparable  terminology,  or by  discussions  of  strategies or
trends.  Although  the  Company  believes  the  expectations  reflected  in such
forward-looking  statements  are  reasonable,  it cannot give any assurance that
these  expectations  will prove to be correct.  Such  statements by their nature
involve  substantial risks and  uncertainties  that could  significantly  impact
expected  results,  and actual future results could differ materially from those
described  in such  forward-looking  statements.  While  it is not  possible  to
identify all factors,  Keystone  continues to face many risks and uncertainties.
Among the factors that could cause actual  future  results to differ  materially
are the risks and  uncertainties  discussed in this  Quarterly  Report and those
described from time to time in the Company's  other fillings with the Securities
and Exchange Commission,  including,  but not limited to, cost of raw materials,
future  supply and  demand for the  Company's  products  (including  cyclicality
thereof),  customer inventory levels,  general economic conditions,  competitive
products and substitute products, customer and competitor strategies, the impact
of pricing and  production  decisions,  the  possibility  of labor  disruptions,
environmental matters,  government regulations and possible changes therein, the
ultimate  resolution of pending  litigation,  successful  implementation  of the
Company's capital improvements plan,  international trade policies of the United
States and certain foreign  countries,  and any possible  future  litigation and
other risks and  uncertainties  as  discussed in this  Quarterly  Report and the
Annual Report,  including,  without  limitation,  the section  referenced above.
Should one or more of these risks  materialize,  (or the  consequences of such a
development worsen) or should the underlying assumptions prove incorrect, actual
results could differ  materially from those forecasted or expected.  The Company
disclaims any  intention or  obligation to update or revise any  forward-looking
statement whether as a result of new information, future events or otherwise.

         The  following  table sets  forth the  Company's  production  and sales
volume data for the periods indicated:
<TABLE>
<CAPTION>

                                                              Three months ended
                                                                   March 31,
                                                              ------------------
                                                               1999        2000
                                                               ----        ----
                                                            (In thousands of tons)

Production volume:
 Billets:
<S>                                                             <C>         <C>
  Produced ...........................................          155         196
  Purchased ..........................................           28         --
 Rod .................................................          172         197

Sales volume:
 Fabricated wire products ............................           85          82
 Industrial wire .....................................           38          36
 Steel rod ...........................................           54          81
                                                                ---         ---

                                                                177         199
                                                                ===         ===
</TABLE>

         The  following  table sets forth the  components  of the  Company's net
sales for the periods indicated.
<TABLE>
<CAPTION>

                                                            Three months ended
                                                                 March 31,
                                                            ------------------
                                                               (In millions)
                                                            1999         2000
                                                            ----         ----

Steel and wire products:
<S>                                                       <C>            <C>
  Fabricated wire products ............................   $  58.7        $  56.2
  Industrial wire .....................................      17.6           16.1
  Rod .................................................      13.2           21.6
  Other ...............................................        .3             .3
                                                            -----          -----
                                                             89.8           94.2

Lawn and garden products ..............................       1.9            2.2
                                                            -----          -----
                                                          $  91.7        $  96.4
                                                          =======        =======
</TABLE>

         The following  table sets forth selected  operating data of the Company
as a percentage of net sales for the periods indicated.
<TABLE>
<CAPTION>

                                                              Three months ended
                                                                   March 31,
                                                              ------------------
                                                               1999         2000
                                                               ----         ----

<S>                                                            <C>          <C>
Net sales .............................................        100.0%       100.0%
Cost of goods sold ....................................         91.2         93.3
Gross profit ..........................................          8.8          6.7
Selling expense .......................................          2.0          1.9
General and administrative expense ....................          6.6          5.2
Overfunded defined benefit pension credit .............         (2.7)         (.8)

Loss before income taxes ..............................          (.7)%       (3.4)%
Income tax benefit ....................................          (.3)        (1.4)%
                                                               -----        -----

Net loss ..............................................          (.4)%       (2.0)%
                                                               =====        =====
</TABLE>


<PAGE>


         Billet  production  increased  27% from  155,000  tons during the first
quarter  of 1999 to  196,000  tons,  a record  level of  billet  production  for
Keystone in a single quarter.  As a result of the increased  billet  production,
Keystone  did not purchase any billets  during the 2000 first  quarter  compared
with  purchases  of 28,000 tons during the 1999 first  quarter.  Rod  production
increased 15% to 197,000 tons from 172,000 tons in the 1999 first  quarter.  The
2000  quarter's rod  production was the most for Keystone in a first quarter and
the second highest produced in a single quarter.

         As a result of improvements  made to Keystone's  steel mill during 1998
and 1999, billet production capacity is 1 million tons. However,  the Company is
presently limited by its Illinois  Environmental  Protection Agency (the "IEPA")
construction  permit to annual  billet  production  of  820,000  tons.  Keystone
applied for  modifications  to its permit to allow  billet  production  of the 1
million ton  capacity.  In April 2000,  the IEPA  notified  the Company that the
modified permit complies with applicable Federal and state air pollution control
laws and rules.  Before  the  permit can be issued,  the IEPA must hold a 30 day
public comment period. If no substantial comments are received,  the permit will
be issued on May 20,  2000.  Issuance  of the permit  would  allow  Keystone  to
produce 1 million tons of billets, the capacity of its furnace. However, because
the  Company's  rod mill has a  capacity  of only  approximately  800,000  tons,
billets  produced in excess of that amount  would be sold  externally  or rolled
into rod through a tolling arrangement with another manufacturer.

         Net sales of $96.4  million in the 2000 first quarter were up 5 percent
from $91.7 million in the same period in 1999.  The increase in sales was due to
a 12% increase in shipments of the Company's  steel and wire products  partially
offset by a 7% overall  decrease in product per ton selling prices.  The overall
price decline was  partially  due to a charge in product mix.  Carbon steel rod,
Keystone's  lowest-price product,  accounted for 41% of steel and wire shipments
in the 2000 first quarter versus 30% in the 1999 first quarter. Shipments of rod
increased 49% while per ton selling prices of rod increased 10%. Industrial wire
shipments  during 2000  declined 6% from the 1999 quarter  while per ton selling
prices  declined 3%.  Fabricated wire product  shipments  declined 3% during the
2000 first  quarter as compared to the 1999 first  quarter while per ton selling
prices declined 1%.

         Gross  profit  during the 2000 first  quarter  declined to $6.4 million
from $8.1  million  in the 1999  first  quarter as the  Company's  gross  margin
declined  from 8.8% in the 1999 period to 6.7% in the 2000 first  quarter.  This
decrease in gross  margin was due  primarily  to higher  costs for scrap  steel,
Keystone's primary raw material,  and the lower overall per-ton selling price of
the Company's  products.  During the 2000 first quarter,  the Company  purchased
194,000  tons of scrap at an average  price of $111 per ton as  compared to 1999
first  quarter  purchases  of 111,000  tons at an average  price of $80 per ton.
During the 1999 first quarter,  Keystone  purchased 28,000 tons of billets at an
average price of $199 per ton, as compared to none in the 2000 first quarter.

          Selling  expenses  in the 2000  first  quarter  of $1.8  million  were
comparable with selling expenses in the first quarter of 1999.

         General  and  administrative  expenses  during the 2000  first  quarter
decreased  $1.1  million  to $5.0  million  from $6.1  million in the 1999 first
quarter due primarily to an unfavorable legal settlement of $460,000 in the 1999
first quarter and administrative expenses associated with the start-up of Garden
Zone during the 1999 first quarter.

         The overfunded  defined  benefit pension credit in the first quarter of
2000 was $736,000 as compared to $2.5 million in the first quarter of 1999.  The
decline was primarily a result of the increased pension benefits included in the
Company's May 1999 labor  contract with the Peoria  facility's  union.  Keystone
currently  anticipates the total 2000 overfunded  defined benefit pension credit
will  approximate  $3.0  million as compared  to a total  credit in 1999 of $5.6
million.

         Interest  expense in the first quarter of 2000 was slightly higher than
the first quarter of 1999 due  principally  to higher average  borrowing  levels
under the  Company's  revolving  credit  facilities.  Average  borrowings by the
Company  under its  revolving  credit  facilities,  term loans and 9 5/8% Senior
Secured  Notes  approximated  $150.7  million  in the first  quarter  of 2000 as
compared  to $142.1  million  in the first  quarter  of 1999.  During  the first
quarter of 2000,  the  average  interest  rate paid by the  Company was 9.4% per
annum as compared to 9.3% per annum in the first quarter of 1999.

         The  principal  reasons for the  difference  between  the U.S.  federal
statutory  income  tax rate and the  Company's  effective  income  tax rates are
explained in Note 5 to the Consolidated Financial Statements.

         As a result of the items discussed  above,  the Company  incurred a net
loss during the first  quarter of 2000 of $1.9 million as compared to a net loss
of $348,000 in the first quarter of 1999.

         During  December 1998,  Keystone  completed the  installation  of a new
electric  arc furnace at its steel  mill.  The  Company  experienced  production
problems  related to the  start-up  of the new furnace  throughout  1999 and the
first quarter of 2000. These problems were identified during 1999.  Keystone had
previously  believed the problems  would have been  resolved,  and the equipment
performing  at  desired  levels,  during  the first  quarter  of 2000.  However,
Keystone  currently  believes the production  problems were not corrected  until
April 2000.

         Keystone has announced a $12 per-ton increase in rod selling prices for
all shipments  ordered after April 1, 2000. The company  anticipates  such price
increase  will be  fully  implemented  by July 1,  2000.  The  Company  has also
announced  a $12 per-ton  increase in  industrial  wire  selling  prices for all
orders after May 1, 2000.  Several other  domestic rod producers  have announced
price increases ranging from $15 to $20 per ton effective with shipments July 1,
2000. The Company is evaluating  similar price increase and will make a decision
soon.  However,  due to the  decline in the level of rod imports and firming rod
import  prices,   Keystone  currently  believes  any  similar  additional  price
increases  would be  substantially  realized.  Despite  strong market demand and
increased  selling  price,  management  believes  the Company will record a loss
during the second  quarter of 2000 due to  expected  higher  scrap costs and the
delay in resolving the production problems discussed above. However,  management
currently believes Keystone will be profitable for calendar 2000.

LIQUIDITY AND CAPITAL RESOURCES:

         The Company's cash flows from operating  activities are affected by the
seasonality  of  its  business  as  sales  of  certain   products  used  in  the
agricultural and construction industries are typically highest during the second
quarter  and  lowest  during the fourth  quarter  of each year.  These  seasonal
fluctuations  impact  the timing of  production,  sales and  purchases  and have
typically  resulted  in a use of  cash  from  operations  and  increases  in the
outstanding  balance under the Company's  revolving credit facilities during the
first quarter of each year.

         At March 31,  2000  Keystone  had  negative  working  capital  of $16.7
million,  including  $1.8  million of notes  payable and current  maturities  of
long-term debt as well as outstanding  borrowings under the Company's  revolving
credit  facilities of $56.2 million.  The amount of available  borrowings  under
these  revolving  credit  facilities is based on  formula-determined  amounts of
trade  receivables and  inventories,  less the amount of outstanding  letters of
credit.  Under the terms of the indenture related to the Company's 9 5/8% Senior
Secured  Notes,   Keystone's  ability  to  borrow  under  its  revolving  credit
facilities  may be limited.  At March 31,  2000,  unused  credit  available  for
borrowing under Keystone's $60 million revolving credit facility,  which expires
December 31, 2001, and EWP's $6 million revolving credit facility, which expires
June 30, 2000, were $11.1 million and $345,000,  respectively.  Garden Zone's $4
million  revolving credit  facility,  which expires December 11, 2000, was fully
drawn at March 31,  2000.  The terms of the  indenture  will permit  Keystone to
borrow all of the $11.1 million  unused credit  available  under  Keystone's $60
million revolving credit facility during the second quarter of 2000.  Keystone's
$60 million  revolving  credit facility  requires daily cash receipts be used to
reduce  outstanding  borrowings,  which results in the Company  maintaining zero
cash balances when there are balances  outstanding  under this credit  facility.
EWP has begun discussions with its lender relative to renewing and extending its
$6 million revolving credit facility upon its maturity.

         During the first quarter of 2000,  Keystone's operating activities used
approximately  $8.7  million  of cash  compared  to $13.9  million  in the first
quarter of 1999 due primarily to increases in accounts payable.

         During the first quarter of 2000, the Company made capital expenditures
of  approximately  $2.9  million as compared  to $6.5  million in the 1999 first
quarter.   Capital   expenditures  for  2000  are  currently   estimated  to  be
approximately  $13.6 million and are related primarily to upgrades of production
equipment.  These  capital  expenditures  will be funded  using  cash flows from
operations  together with  borrowing  availability  under  Keystone's  revolving
credit facilities.


         At March 31, 2000, the Company's financial statements reflected accrued
liabilities  of $18.5  million for  estimated  remediation  costs  arising  from
environmental  issues.  There is no assurance  regarding  the  ultimate  cost of
remedial measures that might eventually be required by environmental authorities
or  that  additional   environmental   hazards,   requiring   further   remedial
expenditures,  might not be asserted  by such  authorities  or private  parties.
Accordingly,  the costs of remedial measures may exceed the amounts accrued.  In
April 2000, the National  Environmental  Law Center and affiliated  local public
interest groups,  advised Keystone,  the United States Environmental  Protection
Agency and the  Illinois  Environmental  Protection  Agency  ("the IEPA") of its
intent to file suit against Keystone in Federal court for allegedly  discharging
excessive  amounts of ammonia into the Illinois  River in violation of the Clean
Water Act. Keystone had been reporting the ammonia  discharges to the IEPA while
attempting to locate the source.  The Company has now located the ammonia source
and is in the process of developing corrective action.  Keystone has requested a
meeting  with the IEPA to resolve  the  alleged  violations  and to enter into a
consent decree relative to future ammonia discharges.


         In April 2000,  the  membership  of the  International  Association  of
Machinists and Aerospace  Workers (Local 1570),  which represents  approximately
160 employees at Keystone's Sherman Wire Company ("Sherman") in Sherman,  Texas,
ratified a new three-year  agreement with Sherman that provides for, among other
things, increased wages and benefits for the membership.

         Keystone incurs  significant  ongoing costs for plant and equipment and
substantial employee medical benefits for both current and retired employees. As
such,  the Company is vulnerable  to business  downturns and increases in costs,
and accordingly, routinely compares its liquidity requirements and capital needs
against its estimated  future operating cash flows. As a result of this process,
the Company has in the past, and may in the future,  reduce  controllable costs,
modify  product  mix,  acquire and dispose of  businesses,  restructure  certain
indebtedness,  and raise  additional  equity capital.  Keystone will continue to
evaluate the need for similar  actions or other  measures in the future in order
to meet its obligations.  The Company also routinely  evaluates  acquisitions of
interests in, or combinations  with,  companies related to the Company's current
businesses.  Keystone  intends to consider  such  acquisition  activities in the
future and, in connection with this activity,  may consider  issuing  additional
equity  securities  or  increasing  the  indebtedness  of the Company.  However,
Keystone's  ability  to incur new debt in the future may be limited by the terms
of the indenture related to the 9 5/8% Senior Secured Notes.

         Management  believes the cash flows from  operations  together with the
funds  available  under  the  Company's  revolving  credit  facilities  will  be
sufficient to fund the anticipated needs of the Company's operations and capital
improvements  for the year ending  December 31, 2000.  This belief is based upon
management's assessment of various financial and operational factors, including,
but not limited to, assumptions  relating to product shipments,  product mix and
selling  prices,  production  schedules,   productivity  rates,  raw  materials,
electricity,  labor,  employee  benefits  and other  fixed and  variable  costs,
interest  rates,  repayments  of  long-term  debt,  capital  expenditures,   and
available  borrowings under the Company's revolving credit facilities.  However,
liabilities  under  environmental  laws  and  regulations  with  respect  to the
clean-up and  disposal of wastes,  or any  significant  increases in the cost of
providing medical coverage to active and retired employees could have a material
adverse  effect on the future  liquidity,  financial  condition  and  results of
operations of the Company.  Additionally,  significant declines in the Company's
end user markets or market share, the inability to maintain  satisfactory billet
and rod production levels, or other unanticipated  costs, if significant,  could
result in a need for funds  greater than the Company  currently  has  available.
There can be no assurance the Company would be able to obtain an adequate amount
of additional financing.




<PAGE>


PART II.

ITEM 1. Legal Proceedings

         Reference is made to  disclosure  provided  under the caption  "Current
litigation" in Note 15 to the Consolidated  Financial Statements included in the
Annual Report.

ITEM 6. Exhibits and Reports on Form 8-K.
        --------------------------------

(a)     The following exhibits are included herein:

        27.1      --Financial  Data  Schedule  for the three month  period ended
                  March 31, 2000.

 (b) Reports on Form 8-K filed during the quarter ended March 31, 2000:

     None


<PAGE>




                               S I G N A T U R E S



Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
Registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.

                                          Keystone Consolidated Industries, Inc.
                                          --------------------------------------
                                                      (Registrant)


Date:  May 11, 2000                       By /s/Harold M. Curdy
                                          ----------------------------------
                                          Harold M. Curdy
                                          Vice President - Finance/Treasurer
                                            (Principal Financial Officer)


Date:  May 11, 2000                      By /s/Bert E. Downing, Jr.
                                         ----------------------------------
                                         Bert E. Downing, Jr.
                                         Vice President and Corporate Controller
                                           (Principal Accounting Officer)