UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                               WASHINGTON DC 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 ended        September  30, 1996
                              --------------------------------------------

                                       OR

/ /      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934

For the transition period from                    to
                                -----------------    ---------------------


Commission File Number       1-9887
                      ---------------------


                            OREGON STEEL MILLS, INC.
             (Exact name of registrant as specified in its charter)


              Delaware                                94-0506370
---------------------------------------------------------------------------
   (State or other jurisdiction of                   (IRS Employer
    incorporation or organization)                 Identification No.)

1000 Broadway Building, Suite 2200, Portland, Oregon        97205
---------------------------------------------------------------------------
(Address of principal executive offices)                  (Zip Code)

                                (503)223-9228
---------------------------------------------------------------------------
              (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 Sections 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
                                       ------    ------

                      APPLICABLE ONLY TO CORPORATE ISSUERS:

         Indicate  the  number of  shares  outstanding  of each of the  issuer's
classes of common stock, as of the latest practicable date.

         Common Stock, $.01 Par Value                  25,693,471
         ----------------------------          ------------------------------
                     Class                      Number of Shares Outstanding
                                                  (as of October 31, 1996)


<PAGE>







                                        1

                            OREGON STEEL MILLS, INC.
                                      INDEX



                                                                           Page
                                                                           ----
PART I.  FINANCIAL  INFORMATION

         Item 1.  Financial Statements

                  Consolidated Balance Sheets
                     September 30, 1996 (unaudited)
                     and December 31, 1995....................................2

                  Consolidated Statements of Income (unaudited)
                     Three months and nine months ended September 30, 1996
                     and 1995 ................................................3

                  Consolidated Statements of Cash Flows (unaudited)
                     Nine months ended September 30, 1996
                     and 1995 ................................................4

                  Notes to Consolidated Financial
                     Statements (unaudited)...............................5 - 6

         Item 2.  Management's Discussion and Analysis of Financial
                     Condition and Results of Operations.................7 - 10


PART II. OTHER INFORMATION

         Item 6.  Exhibits and Reports on Form 8-K...........................11


SIGNATURES        ...........................................................11


<PAGE>
<TABLE>

                                       2

                            OREGON STEEL MILLS, INC.
                           CONSOLIDATED BALANCE SHEETS
                                 (In thousands)

<CAPTION>

                                                       September 30,
                                                           1996                  December 31,
                                                       (Unaudited)                   1995
                                                       ------------              ------------
                                                                                      

                                      ASSETS
<S>                                                    <C>                         <C>    
Current assets:
   Cash and cash equivalents                           $   2,229                   $     644
                                                       
   Trade accounts receivable, net                         86,746                      80,520                      
   Inventories                                           134,895                     141,310                      
   Deferred tax asset                                      9,856                       9,461                      
   Other                                                   9,369                       4,845                      
                                                       ---------                   ---------
        Total current assets                             243,095                     236,780                      
                                                       ---------                   ---------
                                                      
Property, plant and equipment:
   Land and improvements                                  29,517                      28,471
   Buildings                                              37,362                      37,126                          
   Machinery and equipment                               423,561                     376,217               
   Construction in progress                              224,151                     171,487               
                                                       ---------                   ---------               
                                                         714,591                     613,301               
   Accumulated depreciation                             (138,495)                   (118,147)              
                                                       ---------                   ---------   
                                                         576,096                     495,154               
                                                       ---------                   ---------   
Excess of cost over net assets acquired                   40,729                      41,555               
Other assets                                              37,358                      31,777               
                                                       ---------                   ---------                                       
                                                       $ 897,278                   $ 805,266               
                                                       =========                   =========               
                                                                                  
                                    LIABILITIES
Current liabilities:             
   Current portion of long-term debt                   $   6,574                   $   4,576
   Short-term debt                                         5,548                           -                 
   Accounts payable                                       81,560                      85,360          
   Accrued expenses                                       47,580                      31,391                
                                                       ---------                   ---------                                       
        Total current liabilities                        141,262                     121,327           
Long-term debt                                           294,216                     312,679           
Deferred employee benefits                                17,894                      17,044           
Other deferred liabilities                                35,130                      36,331           
Deferred income taxes                                     22,337                      15,470           
                                                       ---------                   ---------   
                                                         510,839                     502,851           
                                                       ---------                   ---------    
Minority interests                                        36,354                      35,625         
                                                       ---------                   ---------                                
Commitments and contingencies (Notes 4 and 5)

                                STOCKHOLDERS' EQUITY
Common stock                                                 257                         194
Additional paid-in capital                               226,015                     150,826
Retained earnings                                        127,265                     119,302
Cumulative foreign currency translation adjustment        (3,452)                     (3,532)
                                                       ---------                   ---------         
                                                         350,085                     266,790
                                                       ---------                   --------- 
                                                       $ 897,278                   $ 805,266
                                                       =========                   =========


         The accompanying notes are an integral part of the consolidated financial statements.
                             
</TABLE>


<PAGE>
                                       3
<TABLE>


                                                  OREGON STEEL MILLS, INC.                  
                                             CONSOLIDATED STATEMENTS OF INCOME                          
                                     (In thousands, except tonnage and per share amounts)                 
                                                        (Unaudited)                                     
             

<CAPTION>

                                                                  Three Months Ended                       Nine Months Ended
                                                                    September 30,                             September 30,
                                                           ------------------------------           -------------------------------
                                                                1996              1995                  1996               1995
                                                           -------------       ----------           ------------       ------------
<S>                                                         <C>                 <C>                 <C>                 <C>   
    
Sales                                                       $   187,671         $   188,479         $   567,217         $   530,603
Costs and expenses:
   Cost of sales                                                161,600             170,681             489,796             472,340
   Selling, general and     
      administrative expenses                                    10,971              11,401              33,475              32,652
   Profit Participation and 
      ESOP contribution                                           2,255                 592               5,854               3,985
                                                            -----------         -----------         -----------         -----------
         Operating income                                        12,845               5,805              38,092              21,626
Other income (expense):
   Interest and dividend income                                     189                 123                 421                 248
   Interest expense                                              (3,462)             (2,990)            (10,133)             (7,112)
   Loss on termination of interest 
   rate swap agreements (Note 7)                                      -                   -              (1,233)                  -
   Minority interests                                               203                  93                (695)                158
   Other, net                                                       195                  53                 756                 661
                                                            -----------         -----------         -----------         -----------

      Income before income taxes                                  9,970               3,084              27,208              15,581
Income tax expense                                               (3,614)             (1,118)            (10,211)             (5,959)
                                                            -----------         -----------         -----------         ----------- 

          Net income                                        $     6,356         $     1,966         $    16,997         $     9,622
                                                            ===========         ===========         ===========         ===========
                                                            
Primary and fully diluted net income
  per common and common
  equivalent share                                                 $.24                $.10                $.76                $.48

Dividends declared per common share                                $.14                $.14                $.42                $.42

Weighted average common shares
  and common share equivalents
  outstanding                                                    26,266              20,020              22,346              20,015

Tonnage sold                                                    373,300             372,900           1,123,300           1,045,200


         The accompanying notes are an integral part of the consolidated financial statements.
                             

</TABLE>

<PAGE>
                                       4
<TABLE>

                                                  OREGON STEEL MILLS, INC.
                                            CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                     (In thousands)
                                                       (Unaudited)
<CAPTION>


                                                                   Nine Months Ended September 30,
                                                                  ---------------------------------
                                                                      1996                 1995
                                                                      ----                 ----
<S>                                                                <C>                  <C>   
Cash flows from operating activities:
  Net income                                                       $  16,997            $   9,622    
  Adjustments to reconcile net income to net                                                       
    cash provided (used) by operating activities:                                                      
       Depreciation and amortization                                  21,523               17,934    
       Deferred income tax provision                                   7,202                4,984    
       Minority interests' share of income (loss)                        729                 (123)   
       Other, net                                                      2,420               (1,366)   
       Changes in current assets and liabilities                      25,689               49,533    
                                                                   ---------            ---------    
  NET CASH PROVIDED BY OPERATING ACTIVITIES                           74,560               80,584    
                                                                   ---------            ---------    
                                                                                                   
Cash flows from investing activities:                                                              
  Additions to property, plant and equipment                        (120,058)            (119,553)   
  Other, net                                                            (156)                (440)   
                                                                   ---------            ---------    
  NET CASH USED BY INVESTING ACTIVITIES                             (120,214)            (119,993)   
                                                                   ---------            ---------    
Cash flows from financing activities:                                                              
                                            
  Net borrowings (payments) under Canadian bank                                           
    revolving loan facility                                           (1,165)                 766    
  Proceeds from long-term bank debt                                  154,800              210,600    
  Payments on long-term debt                                        (399,552)            (159,180)       
  Net proceeds from issuance of 11% First Mortgage Notes             226,995                    -       
  Net proceeds from issuance of common stock                          75,252                    -    
  Dividends paid                                                      (9,035)              (8,151)   
  Other, net                                                             (56)                (232)   
                                                                   ---------            ---------    
  NET CASH PROVIDED BY FINANCING ACTIVITIES                           47,239               43,803   
                                                                   ---------            ---------              
Effects of foreign currency exchange rate changes on cash                  -                  171    
                                                                   ---------            ---------    
Net increase (decrease) in cash and cash equivalents                   1,585                4,565    
Cash and cash equivalents at beginning of period                         644                5,039    
                                                                   ---------            ---------    
Cash and cash equivalents at end of period                         $   2,229            $   9,604    
                                                                   =========            =========    
                                                                                                   
Supplemental disclosures of cash flow information:                                                 
  Cash paid for:                                                                                     
    Interest                                                       $  19,138            $  10,902   
    Income taxes                                                   $   6,729            $   1,620    
                                                                    
                                                                                                 
                                                                   
NON-CASH OPERATING, INVESTING AND FINANCING ACTIVITIES:

At September 30, 1996 and September 30, 1995, the Company had financed property,
plant and  equipment  with accounts  payable of $9.7 million and $23.7  million,
respectively.

         The accompanying notes are an integral part of the consolidated financial statements.
                             

</TABLE>








<PAGE>
                                       5


                            OREGON STEEL MILLS, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

1.   Basis of Presentation
     ---------------------

     The consolidated  financial statements include the accounts of Oregon Steel
     Mills,  Inc.  and  its  subsidiaries   (the  "Company").   All  significant
     intercompany  balances  and  transactions  have  been  eliminated.  Certain
     previously  reported  amounts  have been  reclassified  to conform with the
     current period presentation.

     The unaudited financial  statements include all adjustments  (consisting of
     normal  recurring  accruals)  which,  in the  opinion  of  management,  are
     necessary for a fair  presentation of the interim  periods.  Results for an
     interim period are not  necessarily  indicative of results for a full year.
     Reference  should be made to the Company's 1995 Annual Report on Form 10-K,
     as amended, for additional  disclosures  including a summary of significant
     accounting policies.

2.   Inventories
     -----------

     Inventories consist of:
                                        September 30,           December 31,
                                            1996                    1995
                                        -------------          -------------
                                                  (In thousands)

     Raw materials                         $ 35,239               $ 31,520
     Semi-finished product                   38,931                 51,770
     Finished product                        37,386                 38,111
     Stores and operating supplies           23,339                 19,909
                                           --------               --------
          Total inventory                  $134,895               $141,310
                                           ========               ========

3.   Common Stock
     ------------

     On October 31,  1996,  the Board of  Directors  declared a  quarterly  cash
     dividend  of  14  cents  per  share  to  be  paid  November  30,  1996,  to
     stockholders  of record as of November 15, 1996.  See Note 6 for discussion
     of issuance of common stock.

4.   Contingencies
     -------------

     ENVIRONMENTAL.  The  Company's 87 percent owned New CF&I,  Inc.  subsidiary
     owns a 95.2 percent  interest in CF&I Steel,  L.P.  ("CF&I") which owns the
     Pueblo,  Colorado  steel mill. In  connection  with CF&I's  acquisition  of
     certain  assets from CF&I Steel  Corporation  in 1993,  CF&I  established a
     reserve  of $36.7  million  for  environmental  remediation.  The  Colorado
     Department of Public Health and Environment issued a 10-year,  post-closure
     permit with two ten-year renewals to CF&I which became effective on October
     30,  1995.  The permit  contains a schedule  for  corrective  actions to be
     completed  which is  substantially  reflective of a  straight-line  rate of
     expenditure  over 30 years.  At September  30, 1996,  CF&I had a reserve of
     $35.2  million  related  to this  remediation,  of which  $33.3  million is
     classified as non-current in other deferred liabilities in the consolidated
     balance sheet.

5.   Commitments
     -----------

     During 1994 the Company began  construction of various capital  improvement
     projects at both its  Portland,  Oregon and Pueblo,  Colorado  steel mills.
     Commitments  for  expenditures  related to the completion of these projects
     were $30.3 million at September 30, 1996.


<PAGE>
                                       6


6.   Public Offerings and Refinancing
     --------------------------------

     On June 19,  1996,  the Company  completed  public  offerings  of 6,000,000
     shares of  common  stock at $12.75  per  share and $235  million  principal
     amount of 11% First Mortgage Notes (the "Notes") due 2003. On July 9, 1996,
     the Company  issued an additional  271,857 shares of common stock at $12.75
     per share pursuant to an underwriter's  over-allotment option. The proceeds
     from these offerings were $302.2 million,  net of expenses and underwriting
     discounts. The Notes are guaranteed by two subsidiaries of the Company, New
     CF&I,  Inc.  and CF&I  ("Guarantors").  The  Notes and the  guarantees  are
     secured by a lien on  substantially  all the property,  plant and equipment
     and  certain  other  assets of the Company  and the  Guarantors.  The Notes
     contain  potential  restrictions on new  indebtedness  and various types of
     disbursements,  including  dividends,  based on the Company's net income in
     relation to its fixed charges, as defined.

     The proceeds from the common stock and notes  offerings  were used to repay
     in full  borrowing  under the  Company's  bank credit  agreement  (the "Old
     Credit   Agreement").   The  remaining   proceeds  were  used  for  capital
     expenditures and general corporate purposes.

     Concurrent with the public offerings,  the Company amended and restated the
     Old Credit Agreement to establish a $125 million  revolving credit facility
     (the "Amended Credit Agreement")  collateralized by accounts receivable and
     inventory and guaranteed by the  Guarantors.  The Amended Credit  Agreement
     contains  various  restrictive  covenants  including a minimum tangible net
     worth,  minimum  interest  coverage  ratio,  and a  maximum  debt to  total
     capitalization  ratio.  Borrowings  are  limited  to  an  amount  equal  to
     specified percentages of accounts receivable and inventory.

7.   Interest Rate Swap Agreements
     -----------------------------

     During June 1996,  the Company  incurred a $1.2  million  pre-tax  loss for
     terminating certain interest rate swap agreements. The swap agreements were
     terminated in  conjunction  with the repayment of borrowings  under the Old
     Credit Agreement.  At September 30, 1996, the Company had two interest rate
     swap agreements outstanding with commercial banks, having a notional amount
     of $25 million.  These interest rate swap  agreements were kept in force to
     reduce  the  impact  of  unfavorable  changes  in  interest  rates  on bank
     borrowings.



<PAGE>
                                       7


                            OREGON STEEL MILLS, INC.


ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
           RESULTS OF OPERATIONS

General
-------

     The following  information  contains  forward-looking  statements which are
made pursuant to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995.  Such  forward-looking  statements  are subject to risks and
uncertainties  and actual results could differ  materially from those
projected. Such risks and uncertainties  include,  but are not limited to,
competitive products  and  pricing,  as  well  as fluctuations in demand;
potential equipment malfunction, plant construction and start-up difficulties, 
repair delays and general business and economic conditions.

     The consolidated  financial statements include the accounts of Oregon Steel
Mills, Inc. and its subsidiaries,  wholly-owned Camrose Pipe Corporation ("CPC")
which owns a 60 percent interest in Camrose Pipe Company ("Camrose"), 87 percent
owned New CF&I,  Inc.  ("New CF&I")  which owns a 95.2 percent  interest in CF&I
Steel, L.P. ("CF&I"), and certain other insignificant subsidiaries.

     The Company is organized  into two business units known as the Oregon Steel
Division and the CF&I Steel  Division.  The Oregon Steel Division is centered on
the  Company's  steel  plate  minimill in  Portland,  Oregon.  It  includes  the
Company's large diameter pipe finishing facility in Napa, California,  the large
diameter and electric resistance welded pipe facility in Camrose,  Alberta,  and
the steel plate rolling mill in Fontana,  California  until the first quarter of
1995  when  it  ceased  shipments.  The  CF&I  Steel  Division  consists  of the
steelmaking  and finishing  facilities of CF&I located in Pueblo,  Colorado,  as
well as certain related operations.

Results of Operations
---------------------
<TABLE>

The following  table sets forth,  by division,  tonnage sold,  sales and average
selling price per ton:
<CAPTION>

                                                    Three Months Ended            Nine Months Ended
                                                       September 30,                September 30,
                                                   ----------------------     ------------------------
                                                     1996          1995          1996           1995
                                                   -------       --------     ---------     ----------
<S>                                              <C>           <C>           <C>           <C>    
Total tonnage sold:            
  Oregon Steel Division:       
     Plate                                           68,000        60,400       219,200       225,500  
     Welded pipe                                     80,000        89,600       209,500       196,800  
     Semi-finished                                    3,200        69,500         3,200       170,500  
                                                 ----------    ----------    ----------    ----------  
         Sub-Total                                  151,200       219,500       431,900       592,800  
                                                 ----------    ----------    ----------    ----------   
CF&I Steel Division:           
     Rail                                            43,400        47,500       200,200       190,300
     Rod/Bar/Wire                                   107,700        64,900       324,600       166,300
     Seamless Pipe                                   39,100        29,900       113,600        84,100
     Semi-finished                                   31,900        11,100        53,000        11,700
                                                 ----------    ----------    ----------    ----------   
         Sub-Total                                  222,100       153,400       691,400       452,400
                                                 ----------    ----------    ----------    ----------   
Total                                               373,300       372,900     1,123,300     1,045,200
                                                 ==========    ==========    ==========    ==========
                               
Sales (in thousands):          
  Oregon Steel Division                          $   92,403    $  117,560    $  267,048    $  309,860
  CF&I Steel Division                                95,268        70,919       300,169       220,743
                                                 ----------    ----------    ----------    ----------
         Total                                   $  187,671    $  188,479    $  567,217    $  530,603
                                                 ==========    ==========    ==========    ==========        
Average selling price per ton: 
  Oregon Steel Division                          $      611    $      536    $      618    $      523
  CF&I Steel Division                            $      429    $      462    $      434    $      479(1)
         Average                                 $      503    $      505    $      505    $      504(1)
<FN>
(1)   Excludes  insurance  proceeds of  approximately $4 million received in the
      second  quarter of 1995 as  reimbursement  of lost profits  resulting from
      lost  production  and startup  delays at CF&I caused by an explosion  that
      occurred during the third quarter of 1994.
</FN>
</TABLE>


<PAGE>
                                       8




                            OREGON STEEL MILLS, INC.

      Sales decreased 0.4 percent to $187.7 million in the third quarter of 1996
and increased  6.9 percent to $567.2  million for the first nine months of 1996,
compared to the corresponding 1995 periods.  Shipments  increased 0.1 percent to
373,300 tons in the third quarter of 1996 and increased 7.5 percent to 1,123,300
tons in the  first  nine  months of 1996,  compared  to the  corresponding  1995
periods. The nine month period increase in sales and shipments was primarily due
to increased  shipments of seamless pipe,  rod, bar and  semi-finished  products
manufactured by the CF&I Steel Division, offset in part by the decrease of sales
of  semi-finished  products by the Oregon Steel  Division.  Rod and bar sales of
$6.7  million  and $26.0  million and  shipments  of 20,600 and 78,700 tons were
capitalized  during the three and nine month  periods  ended  September 30, 1995
when the rod and bar mill was in its pre-operational  phase which ended July 31,
1995.

      Selling prices  decreased $2 to $503 per ton for the third quarter of 1996
and increased $1 to $505 per ton for the first nine months of 1996,  compared to
the corresponding 1995 periods. The changes in average selling price were due to
several offsetting factors,  principally increased sales of rod and bar products
in 1996 at the CF&I Steel  Division,  which  have  significantly  lower  selling
prices than other finished products,  and the decrease of sales of semi-finished
products at the Oregon Steel  Division  which  generally have the lowest selling
price of any of the Company's  products.  Of the $800,000  sales decrease in the
third  quarter of 1996  compared to 1995,  $1.0  million was the result of lower
average selling prices offset by $200,000  resulting from volume  increases.  Of
the $36.6 million  sales  increase for the first nine months of 1996 compared to
1995,  $1.3 million was the result of higher  average  selling  prices and $39.3
million  was the  result of volume  increases,  offset by the $4 million of 1995
insurance proceeds not recurring in 1996.

      The Oregon Steel Division  shipped  151,200 and 431,900 tons of product at
average  selling  prices of $611 and $618 per ton for the  three  month and nine
month periods ended  September 30, 1996,  respectively,  compared to 219,500 and
592,800  tons of  product at  average  selling  prices of $536 and $523 per ton,
during the corresponding 1995 periods. The decline in shipments,  as well as the
increase  in  average  selling  prices,  were  primarily  due to  the  decreased
shipments  of  semi-finished  products  during 1996.  The Oregon Steel  Division
shipped  3,200 tons of  semi-finished  products  during the three and nine month
periods ended September 30, 1996, compared to 69,500 and 170,500 tons during the
corresponding 1995 periods. Also, the first quarter of 1995 included 15,400 tons
of plate shipped from the now closed Fontana plate mill.

      The CF&I Steel Division  shipped 222,100 and 691,400 tons of product at an
average  selling  price of $429 and $434 per ton during the three month and nine
month periods ended  September 30, 1996,  respectively,  compared to 153,400 and
452,400  tons of product at an  average  selling  price of $462 and $479 per ton
during the corresponding 1995 periods. The increased shipment level and decrease
in average selling prices were primarily due to increased  shipments of rod, bar
and semi-finished  products in 1996 compared to 1995. Rod and bar shipments were
92,200 and 278,500 tons during the three and nine month periods ending September
30, 1996, respectively, compared to 48,900 and 118,900 tons in the corresponding
1995 periods.  Rod and bar sales of $6.7 million and $26.0 million and shipments
of 20,600  and  78,700  tons were  capitalized  during  the three and nine month
periods  ended  September  30,  1995  when  the  rod  and  bar  mill  was in its
pre-operational phase which ended July 31, 1995. Semi-finished product shipments
were  31,900 and 53,000  tons  during  the three and nine month  periods  ending
September  30,  1996,  respectively,  compared to 11,100 and 11,700 tons for the
corresponding 1995 periods.

      Gross profit  percentages for the three month and nine month periods ended
September 30, 1996 were 13.9 and 13.6 percent, respectively, compared to 9.4 and
11.0 percent for the corresponding 1995 periods. The gross profit improvement in
1996  compared to 1995 was due to improved  product mix and lower  manufacturing
costs of producing  plate and pipe at the Oregon Steel  Division,  and increased
shipments of seamless pipe products and higher selling prices for  semi-finished
and  seamless  pipe  products at the CF&I Steel  Division.  These  gross  profit
improvements  were partially offset by higher costs and reduced shipments due to
an outage of the ladle refining  furnace at the CF&I Steel Division  during June
1996 as a result of a mechanical failure.

<PAGE>
                                       9

                            OREGON STEEL MILLS, INC.

      During  September  1996,  CF&I  lost  the  use  of one  of  the  two  main
transformers that supply  electricity to its melt shop. Full electrical power is
expected to be restored by early December 1996. CF&I's steel production has been
reduced to approximately 65 percent of normal production  capability.  CF&I will
use its  remaining  steelmaking  capabilities  for its rail,  seamless  pipe and
semi-finished  products and will purchase billets for rod and bar products. As a
result  of the lack of  feedstock,  the rod and bar mill  ceased  operations  on
October 12 and is scheduled to resume production in mid-November when sufficient
purchased  billets are  expected to be  received.  The Company  expects that the
reduced  production  levels  at  CF&I  will  adversely  affect  the  results  of
operations of the Company for the fourth quarter of 1996.  However,  the affects
of the outage will be partially  mitigated by  reimbursement  of lost profits by
the business interruption insurance carrier.

      Selling,  general and  administrative  ("SG&A") expenses for the three and
nine month periods ended  September  30, 1996  decreased  $430,000 and increased
$823,000,  respectively,  from the  corresponding  1995  periods.  SG&A expenses
decreased as a percentage  of sales to 5.8 and 5.9 percent in the three and nine
month  periods  ended  September  30,  1996,  from 6.0 and 6.2  percent  for the
corresponding 1995 periods.  The percentage  decreases are primarily due to cost
controls and increased sales for the first nine months of 1996.

      The profit  participation and ESOP contribution  expense for the three and
nine  month  periods  ended  September  30,  1996  increased   compared  to  the
corresponding  1995  periods,  reflecting  the increased  profitability  in 1996
versus 1995 at the Oregon Steel Division.

      Total interest costs for the three and nine month periods ended  September
30, 1996 were $9.4  million and $24.2  million,  respectively,  compared to $5.6
million  and $15.8  million  for the  corresponding  1995  periods.  The  higher
interest cost is primarily the result of the issuance of $235 million  principal
amount First  Mortgage  Notes in June 1996 to provide  funding for the Company's
capital expenditure programs.  Capitalized interest for the three and nine month
periods  ended   September  30,  1996  was  $5.9  million  and  $14.1   million,
respectively,  compared to $2.6 million and $8.7  million for the  corresponding
1995 periods.

      The  Company's  effective  income tax rates were 36 and 38 percent for the
three and nine month periods ended September 30, 1996, respectively, compared to
36 and 38 percent for the corresponding 1995 periods.

Liquidity and Capital Resources
-------------------------------

      Cash flow from operations for the nine months ended September 30, 1996 was
$74.6 million compared to $80.6 million in the  corresponding  1995 period.  The
major items  affecting  this $6.0  million  decrease  were a higher  increase in
accounts  receivable ($13.5 million) and a lower decrease in inventories  ($10.6
million).  These cash uses were  partially  offset by increased net income ($7.4
million),  increased  depreciation  and  amortization  ($3.6  million),  and  an
increase in accrued expenses ($5.1 million).

      Net working  capital at September  30, 1996  decreased  $13.6 million from
December  31,  1995 due to a $19.9  million  increase  in  current  liabilities,
principally  accrued  expenses  and  short-term  debt,  offset by a $6.3 million
increase in current assets,  principally  accounts  receivable and other current
assets.

     On June 19, 1996, the Company  completed  public offerings of an additional
6,000,000 shares of common stock at $12.75 per share and $235 million  principal
amount of 11% First  Mortgage Notes (the "Notes") due 2003. On July 9, 1996, the
Company issued an additional  271,857 shares of common stock at $12.75 per share
pursuant to an  underwriter's  over-allotment  option.  The proceeds  from these
offerings were $302.2 million, net of expenses and underwriting  discounts.  The
Notes are  guaranteed  by two  subsidiaries  of the  Company,  New CF&I and CF&I
("Guarantors").  The  Notes  and  the  guarantees  are  secured  by  a  lien  on
substantially all the property,  plant and equipment and certain other assets of
the Company and the Guarantors.  The Notes contain potential restrictions on new
indebtedness and various types of disbursements,  including dividends,  based on
the Company's net income in relation to its fixed charges, as defined.

<PAGE>
                                       10


                            OREGON STEEL MILLS, INC.

     The proceeds from the common stock and notes  offerings  were used to repay
in full  borrowing  under the Company's  bank credit  agreement (the "Old Credit
Agreement").  The  remaining  proceeds  were used for capital  expenditures  and
general corporate purposes.

      Concurrent with the public offerings, the Company amended and restated the
Old Credit Agreement to establish a $125 million  revolving credit facility (the
"Amended Credit Agreement")  collateralized by accounts receivable and inventory
and guaranteed by the Guarantors.  The Amended Credit Agreement contains various
restrictive  covenants including a minimum tangible net worth,  minimum interest
coverage ratio, and a maximum debt to total capitalization ratio. Borrowings are
limited to an amount equal to specified  percentages of accounts  receivable and
inventory.  As of September 30, 1996,  $14.5 million was  outstanding  under the
Amended Credit Agreement.

      Term debt of $67.5  million was  incurred by CF&I as part of the  purchase
price of the Pueblo steel mill on March 3, 1993.  This debt is  uncollateralized
and is payable over ten years with interest at 9.5 percent.  As of September 30,
1996,  the  outstanding  balance on the debt was $51.3  million,  of which $44.7
million was classified as long-term.

      The Company has an  uncollateralized  and  uncommitted  revolving  line of
credit  with a bank which may be used to support  issuance of letters of credit,
foreign  exchange  contracts  and interest  rate hedges.  At September 30, 1996,
$13.7 million was restricted under  outstanding  letters of credit. In addition,
the Company has a $4 million  uncollateralized and uncommitted  revolving credit
line with a bank which is restricted to use for letters of credit.  At September
30, 1996, $400,000 was restricted under outstanding letters of credit.

      Camrose  maintains  a $15  million  (Canadian  dollars)  revolving  credit
facility with a bank, the proceeds of which may be used for working  capital and
general corporate purposes.  The facility is collateralized by substantially all
of the assets of Camrose and  borrowings  under this  facility are limited to an
amount  equal to specified  percentages  of Camrose's  eligible  trade  accounts
receivable  and  inventories.  The  facility  expires on January 3, 1997.  As of
September 30, 1996, Camrose had $5.5 million outstanding under the facility.

      The Company  expects that  anticipated  needs for working  capital and the
capital  expenditure  program will be met from  existing  cash  balances,  funds
generated  from  operations  and available  borrowings  under its Amended Credit
Facility.

      CAPITAL  EXPENDITURES.  During the first nine  months of 1996 the  Company
expended  approximately $16.1 million,  excluding  capitalized  interest, on the
capital program at CF&I and $68.3 million,  excluding  capitalized  interest, on
the Steckel  combination  rolling mill (the "Combination  Mill") at the Portland
steel mill.  In  addition  to the  Combination  Mill,  the Company has  expended
approximately  $3.9  million  during the first nine  months of 1996 for  capital
projects at its Oregon Steel  Division  manufacturing  facilities  for recurring
upgrade projects to the present facilities and equipment.

      The Company  encountered delays in the completion of the Combination Mill,
as well as a number of  associated  problems  including  significant  claims and
disputes  concerning the construction of the Mill. As a result,  the Company has
terminated  its  contract  with the  general  contractor  and,  in an  effort to
complete the work as soon as possible,  has engaged other  contractors to finish
the project.  The Company  estimates the cost of the Combination Mill (excluding
capitalized  interest) will be approximately $230 million, $20 million more than
the previous  estimate.  The Company expects to recover this additional 
cost together with other damages from the original contractor. The original
contractor disputes the Company's claim and believes it may be owed additional
amounts. The  Combination Mill is now expected to begin startup operation in 
the first quarter of 1997 and is expected to reach full production capacity in
the first quarter of 1998.










<PAGE>
                                       11

                 

                            OREGON STEEL MILLS, INC.

PART II  OTHER INFORMATION

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

        (a)   Exhibits


                 11.0     Statement Regarding Computation of Per Share Earnings
                 27.0     Financial Data Schedule

        (b)   Reports on Form 8-K

                   
                 On July 26,  1996,  the  Company  filed Form 8-K in which the 
                 Company  dismissed  its  independent  accountants,  Coopers & 
                 Lybrand,  LLP, as of July 25, 1996.  On July 31, 1996, a Form 
                 8-K/A  was  filed  with the  response  letter  of  Coopers  & 
                 Lybrand, LLP.                                                 
                                                                               
                 On August 1, 1996,  the  Company  filed Form 8-K in which the 
                 Company   engaged  Price   Waterhouse   LLP  as   independent 
                 accountants as of July 25, 1996.  
                            
                                   SIGNATURES

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.

                                                  OREGON STEEL MILLS, INC.




Date:   November 11, 1996                        /s/ Christopher D. Cassard
                                              ---------------------------------
                                                   Christopher D. Cassard
                                                    Corporate Controller
                                                (Principal Accounting Officer)