<PAGE>
                                
               SECURITIES AND EXCHANGE COMMISSION
                    Washington, D. C.  20549
  
  
  [X]   QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE        
SECURITIES EXCHANGE ACT OF 1934
  
         For the quarterly period ended March 31, 1998
  
                               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 Number 0-3855
  
  
                      LACLEDE STEEL COMPANY             
     (Exact name of Registrant as specified in its charter)
  
            Delaware                        43-0368310    
  (State or other jurisdiction of       I.R.S. Employer
  incorporation or organization)        Identification No.


  One Metropolitan Square, St. Louis, Missouri 
63102
    (Address of principal executive offices)
                   (Zip code)


                        314-425-1400            
            
 (Registrant's telephone number, including area
code)

                                                
                 (Former name, former address
and former fiscal year, if changed since last
report)
 
     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      

     As of April 22, 1998 there were 4,056,140
shares of $.01 par value common stock
outstanding.<PAGE>



ITEM 1:  FINANCIAL STATEMENTS

              LACLEDE STEEL COMPANY
                 AND SUBSIDIARIES
      CONSOLIDATED STATEMENTS OF OPERATIONS
       (In Thousands Except Per Share Data)


                                                   Three Months Ended
                                                   March 31,
                                                   1998          1997

Net sales                                         $  84,555     $  80,846

Costs and expenses:
     Cost of products sold                           77,638        73,870
     Selling, general and administrative expenses     3,818         3,359
     Depreciation                                     1,711         1,942
     Interest expense, net                            2,678         2,427
     Unusual charges (credits)                        2,093          (987)
          Total costs and expenses                   87,938        80,611

Earnings (loss) before income taxes                  (3,383)          235

Provision (credit) for income taxes                  (1,345)          100

Net earnings (loss)                                  (2,038)          135

Preferred stock dividend requirement                    (94)          (94)

Net earnings (loss) available to common           $  (2,132)    $      41
  shareholders

Basic and diluted
  net earnings (loss) per share                   $   (0.53)    $    0.01















                      - 1 -
<PAGE>
              LACLEDE STEEL COMPANY
                 AND SUBSIDIARIES
           CONSOLIDATED BALANCE SHEETS
                      ASSETS
                  (In Thousands)


                                                  Mar. 31,      Dec. 31,
                                                  1998          1997

Current Assets:
    Cash and cash equivalents                     $     195     $     186
    Accounts receivable, less allowances             41,849        40,282
    Prepaid expenses                                  1,921         1,238
    Inventories:
        Finished                                     46,826        45,823
        Semi-finished                                18,380        18,166
        Raw materials                                 5,793         4,681
        Supplies                                     13,420        14,136
        Total inventories                            84,419        82,806

            Total Current Assets                    128,384       124,512




Non-Current Assets:
    Intangible pension asset                         13,909        14,652
    Other intangible assets                           2,083         2,119
    Bond funds in trust                               2,385         2,385
    Prepaid pension contributions                     3,417         5,441
    Deferred income taxes                            46,652        45,400
    Notes receivable                                     --         3,396
    Other                                             4,584         4,897
            Total Non-Current Assets                 73,030        78,290




Plant and Equipment, at cost                        240,492       239,670
    Less - accumulated depreciation                 130,134       128,652
            Net Plant and Equipment                 110,358       111,018





Total Assets                                      $ 311,772     $ 313,820


                      - 2 -








       LIABILITIES AND STOCKHOLDERS' EQUITY



                                                  Mar. 31,      Dec. 31,
                                                  1998          1997

Current Liabilities:
    Accounts payable                              $  43,018     $  42,682
    Accrued compensation                              5,024         6,269
    Current portion of long-term debt                 2,356         2,356
    Accrued costs of pension plans                   13,577        13,577
    Other                                             3,061         3,729
            Total Current Liabilities                67,036        68,613


Non-Current Liabilities:
    Accrued costs of pension plans                   36,412        36,864
    Accrued postretirement medical benefits          75,066        75,864
    Other                                             1,999         2,221
            Total Non-Current Liabilities           113,477       114,949


Long-Term Debt:
    Bank revolving credit                            79,967        76,516
    Bank term loan                                    6,993         7,311
    Revenue bonds                                    23,330        23,330
    Other                                             2,000         2,000
            Total Long-Term Debt                    112,290       109,157



Stockholders' Equity:
    Preferred stock, no par value, authorized 2,000,000
      shares; issued and outstanding 416,667 shares      83            83
    Common stock, $0.01 par value, authorized 25,000,000
    shares; issued and outstanding 4,056,140 shares      41            41
    Capital in excess of par value                   59,669        59,763
    Accumulated deficit                             (17,345)      (15,307)
    Minimum pension liability adjustment            (23,479)      (23,479)
            Total Stockholders' Equity               18,969        21,101



Total Liabilities and Stockholders' Equity        $ 311,772     $ 313,820


                      - 3 -
<PAGE>
LACLEDE STEEL COMPANY
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS

(In Thousands)

                                                  Three Months Ended
                                                  March 31,
                                                  1998          1997

Cash flows from operating activities:
 Net earnings (loss)                              $  (2,038)    $     135
 Adjustments to reconcile net earnings (loss) to
    net cash provided by (used in) operating activities:
      Depreciation                                    1,711         1,942
      Unusual charges (credits)                       2,093          (987)
      Change in deferred income taxes                (1,252)          101
 Changes in assets and liabilities that
    provided (used) cash, net of effects from sale of facility:
       Accounts receivable                           (1,567)        1,485
       Inventories                                   (1,613)        1,273
       Accounts payable and accrued expenses         (2,596)         (365)
       Accrued pension cost                           2,322         2,220
       Pension cash funding                          (2,100)       (2,749)
       Accrued postretirement medical benefits         (798)         (550)
       Other assets and liabilities                     141           275
  Net cash provided by (used in) operating activities(5,697)        2,780


Cash flows from investing activities:
  Capital expenditures                               (1,042)          176
  Proceeds from sale of equipment                     3,625            --
  Proceeds from sale of facility                         --         9,319
  Net cash provided by investing activities           2,583         9,495

Cash flows from financing activities:
  Net borrowings (repayments) under revolving credit  3,451       (10,916)
  Payments on long-term debt                           (318)       (1,359)
  Payment of financing costs                            (10)           (7)
  Net cash provided by (used in) financing activities 3,123       (12,282)

Cash and cash equivalents:
  Net increase (decrease) during the period               9            (7)
  At beginning of year                                  186           143
  At end of period                                $     195     $     136





 - 4 -
<PAGE>
LACLEDE STEEL COMPANY
AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
(In Thousands Except Per Share Data)

                                                  Quarter          Year
                                                  Ended            Ended
                                                  Mar. 31,      Dec. 31,
                                                  1998          1997

Preferred stock
  (416,667 shares issued)
  Beginning balance                               $      83     $      83
  Sale of convertible preferred stock                    --            --
  Ending balance                                         83            83

Common stock - $0.01 par value
  (4,056,140 shares issued)
  Beginning balance                                      41            41
  Change in period                                       --            --
  Ending balance                                         41            41

Capital in excess of par value
  Beginning balance                                  59,763        60,138
  Dividend on convertible preferred stock               (94)         (375)
  Ending balance                                     59,669        59,763

Accumulated deficit
  Beginning balance                                 (15,307)      (12,300)
  Net loss                                           (2,038)       (3,007)
  Ending balance                                    (17,345)      (15,307)

Minimum pension liability
  Beginning balance                                 (23,479)      (30,717)
  Change in period                                       --         7,238
  Ending balance                                    (23,479)      (23,479)


Total Stockholders' Equity at End of Period       $  18,969     $  21,101











- 5 -
<PAGE>
   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



NOTE 1 - GENERAL

  The accompanying unaudited consolidated
  financial statements include the accounts of
  Laclede Steel Company and its wholly-owned
  subsidiaries.  All intercompany accounts and
  transactions have been eliminated.  The
  consolidated financial statements reflect all
  adjustments (such adjustments are of a normal
  recurring nature unless otherwise disclosed
  in these interim financial statements) which
  are in the opinion of Management necessary
  for a fair statement of the results for the
  interim periods.


NOTE 2 - UNUSUAL CHARGES (CREDITS)

  In the first quarter of 1998 the Company
  recorded non-cash special charges of $2.1
  million relating to the retirement of John B.
  McKinney as President and Chief Executive
  Officer.  These charges increased the net
  loss for the quarter by $1.3 million of $.31
  per share.

  In February 1997, the Company sold the assets
  of its electric weld structural and
  mechanical tubing operation, located in
  Benwood, West Virginia.  Cash proceeds from
  the sale of these assets, which consist
  primarily of equipment and inventory, totaled
  approximately $11.0 million.  This
  transaction resulted in a gain on sale of
  equipment of $987 thousand ($592 thousand
  after tax) recorded in February 1997.


NOTE 3 - PER SHARE DATA
  
  Per share amounts have been calculated based
  on weighted average shares outstanding of
  4,056,140.  Net earnings (loss) per share for
  1998 and 1997 were computed by dividing the
  net earnings after deducting preferred
  dividend requirements of $94 thousand, by the
  weighted average shares outstanding.




  The financial results for 1998 are subject to
  annual audit.






                      - 6 -<PAGE>
ITEM 2.   MANAGEMENT'S DISCUSSION & ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF
OPERATIONS


         Liquidity and Capital Resources

  In the first quarter of 1998 operating
activities used $5.7 million in cash.  This
reflects increases in accounts receivable and
inventory totaling $3.2 million, and reductions
in accounts payable and accrued expenses of
$2.6 million.

  In January 1998 the Company completed the
sale and leaseback transaction for the Ladle
Metallurgy Facility at the Alton Plant. This
final step of the sale and leaseback
transaction provided the company with $3.6
million in cash.

  Long-term debt increased by $3.1 million
in the first quarter of 1998.  Net working
capital increased by $5.4 million, and the
ratio of current assets to current liabilities
was 1.9 to 1.0 at March 31, 1998.

  At March 31, 1998, $80.0 million in
borrowings were outstanding under the company's
revolving credit facility, with unused
availability of $4.0 million.  Amounts
available under this facility were fully
utilized early in the second quarter of 1998 to
cover outstanding short-term commitments,
primarily trade accounts payable.

  The Company has periodically amended its
Loan and Security Agreement to modify financial
covenants relating to operating results and net
worth.  The most recent amendment was effective
March 27, 1998.  In the event further amendment
to financial covenants is necessary in the
future, there can be no assurance that the
Company will be able to obtain such amendment.

  As part of the modifications to the Loan
and Security Agreement previously mentioned, in
1997 the Company received the approval of
parties to the Solid Waste Revenue Bonds to
eliminate certain negative financial covenants
contained therein and to substitute therefor
certain collateral.  Subsequent to that
substitution, the only remaining negative
financial covenant with respect to the Solid
Waste Revenue Bonds is that the Company may not
without the prior written consent of the Issuer
of the Bonds (i) borrow from its subsidiary,
Laclede Chain Manufacturing Company, or (ii)
take cash advances from Laclede Chain
Manufacturing Company, except to the extent
that the aggregate principal amount of all such
borrowings and cash advances at any one time do
not exceed $7.0 million.  Collateral granted to
the Trustee of the Solid Waste Revenue Bonds
for the benefit of the bondholders consists of
(i) all of the issued and outstanding



                      - 7 -<PAGE>
shares of Laclede Chain Manufacturing Company
and (ii) all of Laclede Chain Manufacturing
Company's machinery and equipment now owned or
thereafter acquired.  As of March 31, 1998, the
Company is in compliance with the remaining
negative covenant contained in the Solid Waste
Revenue Bonds.

  During 1998 the Company anticipates
capital expenditures of approximately $6.0
million, and contributions to pension plans of
$13.6 million.  Assuming that the Company is
able to (i) maintain its existing level of
sales, (ii) avoid sales price decreases and
(iii) capture savings from productivity
improvements, the Company will generate
sufficient cash flow to finance its 1998
liquidity requirements including the above
referenced expenditures.  If the Company is
unable to maintain its existing level of sales
and current pricing or if the Company's
productivity improvements fail to produce
positive financial results, the Company may not
generate sufficient cash flow to finance its
1998 liquidity requirements.  In such event,
the Company would evaluate other methods of
generating cash flow such as the sale of
significant businesses or assets and
refinancing transactions.  There can be no
assurance, however, that any such alternative
could be successfully completed.

  At March 31, 1998 the Company has net
deferred tax assets of $46.7 million. 
Management currently believes that its long-term profitability should
ultimately be sufficient to enable it to realize full benefit
of future tax deductions.  Thus no deferred tax
valuation allowance is deemed necessary.

  The Company will continue to monitor and
evaluate its deferred tax assets and the need
for a deferred tax valuation allowance.  In the
event a deferred tax valuation allowance is
required in the future, amendment of financial
covenants in the Company's Loan and Security
Agreement, as well as its Bond Agreements, may
be required.  There can be no assurance that
the Company will be able to obtain such
amendments.  For a more complete discussion of
the Company's deferred tax assets (including
issues related to Section 382 of the Internal
Revenue Code), see the Company's Annual Report
on Form 10-K for the year ended December 31,
1997.
 
              Results of Operations

  Net sales increased by $3.7 million in the
first quarter of 1998 compared to the first
quarter of 1997.  This reflects a 5.8% increase
in steel shipments, partially offset by a 1.1%
decrease in average sales prices for steel
products.



                      - 8 -<PAGE>
  Cost of products sold increased by 5.1% in
the first quarter of 1998, reflecting higher
steel shipments.  Production costs in 1998 were
affected by slightly higher prices for the
Company's basic raw material, ferrous scrap. 
However, increased shipments of semi-finished
steel had a favorable effect on average
production costs per ton.  Selling, general and
administrative expenses increased by 13.6% in
1998, primarily as a result of consulting fees
paid in connection with Company efforts to
improve operations.

  The increase in interest expenses in the
first quarter of 1998 is the result of an
increase in bank borrowings.  Other non-cash
charges in 1998 of $2.1 million relate to the
retirement of John B. McKinney, President and
Chief Executive Officer.


Cautionary Statement for Purposes of the "Safe
Harbor" Provisions of the Private Securities
Litigation Reform Act of 1995

  The foregoing Management's Discussion and
Analysis and other portions of this report on
Form 10-Q, contain various "forward-looking
statements" within the meaning of Section 27A
of the Securities Act of 1933, as amended, and
Sections 21E of the Securities Exchange Act of
1934, as amended, which represent the Company's
expectations or beliefs concerning future
events, including the following:  statements
regarding the overall demand for steel;
statements regarding the ability to maintain
sales prices; statements regarding productivity
improvement programs; statements regarding the
Company's profitability; statements regarding
future borrowing capacity; and statements
regarding future pension funding requirements. 
In addition, statements containing expressions
such as "believes," "anticipates" or "expects"
used in the Company's periodic reports on Forms
10-K, 10-Q and 8-K filed with the SEC are
intended to identify forward-looking
statements.  Forward-looking statements by the
Company and its management are based on
estimates, projections, beliefs and assumptions
of management and are not guarantees of future
performance.  The Company disclaims any
obligation to update or revise any forward-looking 
statement based on the occurrence of
future events, the receipt of new information,
or otherwise.  The Company cautions that these
and similar statements included in this report
and in previously filed periodic reports
including reports filed on Forms 10-K, 10-Q and
8-K and further qualified by important factors
that could cause actual results to differ
materially from those in the forward-looking
statement, including, without limitation, the
following:  decline in sales prices for steel
products; increases in the cost of steel scrap;
failure to obtain significant benefits from the
Company's cost reduction and productivity
improvement programs; increased domestic or
foreign steel competition and decreases in the
market value of the Company's qualified pension
plan assets.


                      - 9 -     <PAGE>
           PART II - OTHER INFORMATION

ITEM 1.     LEGAL PROCEEDINGS.

            None

ITEM 6.     EXHIBITS AND REPORTS ON FORM 8-K.

            (a)  Exhibits

  (3)(a)    Registrant's Certificate of
            Incorporation as restated
            October 28, 1996.  (Incorporated
            by reference to Exhibit (3) in
            Registrant's Quarterly Report on
            Form 10-Q for September 30,
            1996.)

  (3)(b)    By-laws of Registrant amended
            December 19, 1997. 
            (Incorporated by reference to
            Exhibit (3)(b) in Registrant's
            Annual Report on Form 10-K for
            the fiscal year ended December
            31, 1997.)

  (4)(a)    Registrant's Loan and Security
            Agreement dated as of September
            7, 1994 amended and restated as
            of August 20, 1997. 
            (Incorporated by reference to
            Exhibit (4)(a) in Registrant's
            Quarterly Report on Form 10-Q
            for September 30, 1997.)

  (4)(b)    First Amendment dated December
            30, 1997 to the Company's
            Restated Loan and Security
            Agreement.  (Incorporated by
            reference to Exhibit (4)(b) in
            Registrant's Annual Report on
            Form 10-K for the fiscal year
            ended December 31, 1997.)

  (4)(c)    Second Amendment effective March
            27, 1998 to the Company's
            Restated Loan and Security
            Agreement.  (Incorporated by
            reference to Exhibit (4)(c) in
            Registrant's Annual Report on
            Form 10-K for the fiscal year
            ended December 31, 1997.)
  
            Instruments with respect to
            long-term debt issues have been
            omitted where the amount of
            securities authorized under such
            instruments does not exceed 10%
            of the total consolidated assets
            of the Registrant.  Registrant
            hereby agrees to furnish a copy
            of any such instrument to the
            Commission upon its request.

            (b)  Reports on Form 8-K.

            No reports on Form 8-K have been
            filed during the quarter.

  

                     - 10 -<PAGE>







                   SIGNATURES   



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




              LACLEDE STEEL COMPANY       
                  (Registrant)




             /s/ Michael H. Lane           
                 Michael H. Lane
            Vice President - Finance
             Treasurer and Secretary

           Duly Authorized Officer and
           Principal Financial Officer






Date:       May 13, 1998