UNITED STATES STEEL CORP MANAGEMENT REPORT OF FINANCIAL POSITION AND RESULTS OF OPERATIONS (Form 10-Q)


Insight

For the three months and nine months ended September 30, 2022, the Company's
performance was negatively impacted by lower flat-rolled steel selling prices
and lower demand from select end markets in our domestic and European
flat-rolled steelmaking segments. In addition, both our Mini Mill and European
businesses were impacted by high-cost materials procured earlier in 2022 at the
onset of the war in Ukraine. The Tubular segment results benefited from
continued strong demand, new trade cases on oil country tubular goods (OCTG) and
higher selling prices.

Overall, the Company expects fourth quarter results to be lower on both a
sequential basis to the third quarter and a comparative basis to the same period
a year ago. For the Company's flat-rolled products, lower demand and lower steel
prices are expected to be reflected in its average selling price and volumes. In
addition, elevated raw materials costs for the Company's Mini Mill segment, and
elevated raw material and energy costs in the Company's U. S. Steel Europe
segment are expected to continue through the fourth quarter. For Tubular
Products, the Company expects that higher prices for oil country tubular goods
will increasingly be reflected in the segment's average selling price and that
volumes will continue to reflect strong demand.

In order to balance our flat-rolled steel supply with customer demand, the
Company pulled forward a planned 30-day outage on blast furnace #3 at Mon Valley
Works from October to September. Additionally, the Company temporarily idled
blast furnace #8 and tin line #5 at Gary Works during the third quarter due to
market conditions and high levels of imports. In our European operations, the
Company pulled forward a planned 60-day outage on blast furnace #2 at USSK from
October to September. Each of these assets remain temporarily idled due to
market conditions. The Company continues to monitor market conditions to ensure
our order book and production footprint are balanced.

In February 2022, Russia invaded Ukraine and active conflict continues in the
country. The war in Ukraine will likely continue to cause disruption and
instability in Russia, Ukraine, as well as the markets in which we operate. The
Company is constantly monitoring the situation for impacts and risks to the
business and is implementing risk mitigating strategies where possible.

Following the invasion, governments around the world, including the
European Union (EU) and The United States of America (WE), have enacted sanctions against Russia and Russian interests. We comply with all applicable sanctions that impact our business.

USSE purchases certain raw materials from sources that source from
Russia, including natural gas and iron ore. From the start of the war and before, the USSE built up its inventory of iron ore and coal and sourced it from alternative sources. Current levels of iron ore and coal are sufficient to meet customer demand until the end of 2022.

With the EU prohibiting purchases of coal from suppliers in Russia, new
purchases of coal originating from Russia have stopped. The Company has built up
sufficient inventory on site or in-transit to meet current customer demand.
Efforts to secure alternate sources of supply are underway to continue meeting
demand.

Additionally, in response to sanctions, Russia has limited supply of natural gas
to certain countries. We understand that the country of Slovakia has natural gas
storage levels that are sufficient to cover Slovakia's consumption, and Slovakia
expects additional shipments originating not from Russia, but from Norway and
liquefied natural gas from the U.S. and Africa. Those shipments should be
sufficient to cover the needs for the 2022/2023 winter heating season for both
households as well as industry, based on the public announcement of the Slovak
Ministry of Economy on July 12, 2022. While not expected, if a natural gas
crisis is declared in Slovakia, operations at our USSE business could be
materially adversely impacted.

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Future sanctions and responsive actions in the region remain uncertain, but we
continue to engage with various governmental authorities and suppliers as we
navigate the volatile situation. Our team in USSE has been engaged in
humanitarian efforts related to the war, and we continue to operate to support
the region's people and economy.

RESULTS OF OPERATIONS
U. S. Steel's results in the three and nine months ended September 30, 2022
compared to the same periods in 2021 for the four reportable segments, with the
exception of Tubular, generally declined from deteriorating business conditions:

•North American Flat-Rolled (Flat-Rolled): Flat-Rolled results declined in the
three-month period primarily due to lower sales volume and spot prices across
most customer and manufacturing industries. Flat-Rolled results modestly
increased in the nine-month period primarily due to higher sales price, with
contract prices higher and spot pricing lower than in the prior period. The
benefit of pricing was partially offset by lower sales volume year to date and
increased raw material and energy costs.

•Mini Mill: Mini Mill results declined in the three-month period primarily due
to lower sales volume and price across nearly all consuming industries and
higher raw material costs. Mini mill results declined in the nine-month period
primarily due to lower sales prices industry wide and higher raw material costs.

• American steel Europe (USSE): USSE’s results in the three- and nine-month periods declined primarily due to lower sales volume and higher raw material and energy costs, general inflation and the weakening of the euro exchange rate.

•Tubular Products (Tubular): Tubular results improved in both the three and nine
month periods primarily due to higher sales volume and price from the steady
increase of drilling activity, partially offset by continued high levels of
imports.

Net sales by segment for the three and nine months ended September 30, 2022 and 2021 are presented in the following table:

                                            Three Months Ended              

Nine month period ended

                                               September 30,                            September 30,
(Dollars in millions, excluding
intersegment sales)                          2022          2021        % Change        2022        2021        % Change
Flat-Rolled                             $     3,248    $   3,541         (8)%      $   9,926    $  8,804         13%
Mini Mill (a)                                   602          949        (37)%          2,158       2,158          -%
USSE                                            925        1,246        (26)%          3,518       3,122         13%
Tubular                                         425          216         97%           1,115         534         109%
   Total sales from reportable segments       5,200        5,952        (13)%         16,717      14,618         14%
Other                                             3           12        (75)%             10          35        (71)%
Net sales                               $     5,203    $   5,964        (13)%      $  16,727    $ 14,653         14%
(a) For the nine months ended September 30, 2021 the Mini Mill segment was added after January 15, 2021 with the purchase
of the remaining equity interest in Big River Steel.


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Management’s Discussion and Analysis of Net Sales Percentage Change for US Steel’s Reportable Segments for the Three Months Ended September 30, 2022
compared to the three months ended September 30, 2021:

                                            Steel Products (a)
                               Volume             Price             Mix                 FX (b)             Other (c)             Net Change
Flat-Rolled                           (5) %             (3) %            (2) %                  -  %                  2  %                  (8) %
Mini Mill                            (13) %            (24) %             -  %                  -  %                  -  %                 (37) %
USSE                                 (19) %              6  %             -  %                (15) %                  2  %                 (26) %
Tubular                                3  %             91  %             -  %                  -  %                  3  %                  97  %
(a) Excludes intersegment sales.
(b) Foreign currency translation effects.
(c) Primarily of sales of raw materials and coke making by-products.



Net sales for the three months ended September 30, 2022 compared to the same
period in 2021 were $5,203 million and $5,964 million, respectively.
•For the Flat-Rolled segment the decrease in sales primarily resulted from lower
average realized prices ($93 per ton) from lower value-added products and
decreased shipments (152 thousand tons) primarily from higher value-added
products.
•For the Mini Mill segment the decrease in sales primarily resulted from lower
average realized prices ($421 per ton) across all products and decreased
shipments (79 thousand tons) across all products.
•For the USSE segment the decrease in sales primarily resulted from lower
average realized prices ($122 per ton) across most products and decreased
shipments (197 thousand tons) across most products.
•For the Tubular segment the increase in sales primarily resulted from higher
average realized prices ($1,515 per net ton) and increased shipments (3 thousand
tons).

Management's analysis of the percentage change in net sales for U. S. Steel's
reportable business segments for the nine months ended September 30, 2022 versus
the nine months ended September 30, 2021 is set forth in the following table:

                                                            Steel Products (a)
                                                                                                                                           Net
                               Volume           Price           Mix       Acquisition Variance       FX (b)           Other (c)           Change
Flat-Rolled                          (6) %           17  %           -  %                   n/a             -  %                2  %            13  %
Mini Mill (d)                        (7) %            3  %           -  %                  4  %             -  %                -  %             -  %
USSE                                 (6) %           30  %           -  %                   n/a           (12) %                1  %            13  %
Tubular                              22  %           89  %          (2) %                   n/a             -  %                -  %           109  %
(a) Excludes intersegment sales.
(b) Foreign currency translation effects.
(c) Primarily of sales of raw materials and coke making by-products.
(d) Mini Mill segment added after January 15, 2021 with the purchase of the remaining equity interest in Big River Steel.



Net sales for the nine months ended September 30, 2022 compared to the same
period in 2021 were $16,727 million and $14,653 million, respectively.
•For the Flat-Rolled segment the increase in sales primarily resulted from
higher average realized prices ($215 per ton) primarily from higher value-added
products, partially offset by decreased shipments (498 thousand tons) across
most products.
•For the Mini Mill segment the consistent sales primarily resulted from higher
average realized prices ($13 per ton) from higher value-added products offset by
decreased shipments (20 thousand tons) including the partial period of the
Company's controlling interest in Big River Steel in January of 2021.
•For the USSE segment the increase in sales primarily resulted from higher
average realized prices ($189 per ton) across all products, partially offset by
decreased shipments (230 thousand tons) across most products.
•For the Tubular segment the increase in sales primarily resulted from higher
average realized prices ($1,174 per net ton) and increased shipments (73
thousand tons).

Selling, general and administrative expenses

Selling, general and administrative expenses were $95 million and $324 million
in the three months and nine months ended September 30, 2022, respectively,
compared to $108 million and $316 million in the three months and nine months
ended September 30, 2021, respectively. The change in expenses for the three and
nine months ended September 30, 2022 versus the same periods in 2021 are
primarily driven by profit and variable based incentive costs.
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Restructuring and other charges

During the three months and nine months ended September 30, 2022, the Company
recorded restructuring and other charges of $23 million and $57 million,
respectively. During the nine months ended September 30, 2021, the Company
recognized $37 million for restructuring and other charges. No such charges were
recognized during the three months ended September 30, 2021. See Note 20 to the
Condensed Consolidated Financial Statements for further details.

Operating Configuration Settings

As noted above, the Company adjusted its operating configuration in response to
global overcapacity, unfair trade practices, market conditions and decreased
customer demand by indefinitely and temporarily idling certain of its
facilities. U. S. Steel will continue to adjust its operating configuration in
order to ensure its order book and production footprint are balanced.

Inactive operations

In the third quarter of 2022, we took steps to adjust our footprint by temporarily halting certain operations to better align production with market conditions. Operations that were inactive in the third quarter of 2022 and remained inactive in September 30, 2022as well as their book values ​​including:

•Blast furnace #8 at Gary Works, $30 million
•Tin Line #5 at Gary, $20 million
•Blast furnace #3 at Mon Valley Works, $45 million
•Blast furnace #2 at USSE, $20 million

The following operations were initially idled in 2020 and remained idle as of
September 30, 2022. These facilities and their respective carrying values as of
September 30, 2022 included:

•Blast furnace A at Granite City Works, $55 million
•Lone Star Tubular Operations, $5 million
•Lorain Tubular Operations, $65 million
•Wheeling Machine Products coupling production facility at Hughes Springs,
Texas, immaterial

In December 2021, the Company permanently idled the steelmaking operations at
Great Lakes Works. In addition, in March 2022, the Company permanently idled the
finishing facilities at its East Chicago Tin operations, which had been idled on
an indefinite basis during 2019. In the second quarter 2022, the Company
recognized charges of approximately $151 million for the write-off of the blast
furnaces and related fixed assets for the permanent idling of the iron making
process at the Company's Great Lakes Works facility. The coil finishing process
at Great Lakes Works continues to operate and remains a component of the
Company's operating plans.

Earnings (loss) before interest and income taxes by segment are presented in the following table:

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                                                        Three months ended September                    Nine months ended
                                                                    30,                     %             September 30,             %
(Dollars in millions)                                         2022           2021        Change          2022        2021        Change
Flat-Rolled                                             $          505    $ 1,015             (50) % $   1,795    $ 1,740               3  %
Mini Mill (a)                                                        1        424            (100) %       549        840             (35) %
USSE                                                               (32)       394            (108) %       512        706             (27) %
Tubular                                                            155          -                n/m       339        (29)          1,269  %
               Total earnings from reportable segments             629      1,833             (66) %     3,195      3,257              (2) %
Other                                                               21         (2)          1,150  %        16         20             (20) %
               Segment earnings before interest and
               income taxes                                        650      1,831             (65) %     3,211      3,277              (2) %

Items not assigned to segments:

               Restructuring and other charges                     (23)         -                          (57)       (37)
               Asset impairment charges                              -          -                         (157)       (28)
               Other charges, net                                  (13)        12                          (11)       (36)
               (Losses) gains on assets sold and
               previously held investments                           -         (7)                           -        119
               Gain on sale of Transtar                              -        506                            -        506

Total earnings before interest and income taxes $614 $2,342

             (74) % $   2,986    $ 3,801             (21) %

(a) mini mill segment added after January 15, 2021 with the purchase of the remaining stake in Great River Steel.

Segment Results for Flat Laminates

                                              Three months ended                       Nine months ended
                                                 September 30,             %             September 30,             %
                                               2022         2021         Change         2022        2021         Change
Earnings before interest and taxes ($
millions)                                  $    505     $  1,015             (50) % $  1,795     $  1,740              3  %
Gross margin                                     20   %       32   %         (12) %       22   %       25  %          (3) %
Raw steel production (mnt)                    2,265        2,634             (14) %    6,894        7,700            (10) %
Capability utilization                           68   %       61   %           7  %       70   %       61  %           9  %
Steel shipments (mnt)                         2,176        2,328              (7) %    6,488        6,986             (7) %
Average realized steel price per ton       $  1,232     $  1,325              (7) % $  1,312     $  1,097             20  %



The decrease in Flat-Rolled results for the three months ended September 30,
2022 compared to the same period in 2021 was primarily due to:
•decreased average realized prices, including mix (approximately $80 million)
•decreased shipments, including volume inefficiencies (approximately $105
million)
•decreased non-prime sales (approximately $50 million)
•higher raw material costs (approximately $175 million)
•higher energy costs (approximately $110 million)
•increased operating costs (approximately $115 million),
these changes were partially offset by:
•increased coke, iron ore and other non-steel sales (approximately $10 million)
•favorable equity investees income (approximately $5 million),
•lower other costs, primarily variable compensation (approximately $110
million).

Gross margin for the three months ended September 30, 2022 compared to the same
period in 2021 decreased primarily as a result of lower average realized price
and sales volume and increased input costs.

The increase in Flat-Rolled results for the nine months ended September 30, 2022
compared to the same period in 2021 was primarily due to:
•increased average realized prices, including mix (approximately $1,480 million)
•increased coke, iron ore and other non-steel sales (approximately $70 million)
•favorable equity investees income (approximately $75 million),
these changes were partially offset by:
•decreased shipments, including volume inefficiencies (approximately $190
million)
•decreased non-prime sales (approximately $65 million)
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• higher raw material costs (about $560 million) • higher energy costs (about $290 million) • increased operating costs (about $425 million) •other higher costs, mainly variable compensation (approximately $40 million).

Gross margin for the nine months ended September 30, 2022 compared to the same period in 2021 decreased primarily due to lower sales volume and higher input costs, partially offset by higher average realized prices.

Segment results for mini mill (a)

                                               Three Months Ended                        Nine Months Ended
                                                  September 30,              %             September 30,             %
                                                2022          2021         Change         2022        2021         Change
Earnings before interest and taxes ($
millions)                                  $       1           424            (100) % $    549          840            (35) %
Gross margin                                       7    %       51   %         (44) %       32   %       45  %         (13) %
Raw steel production (mnt)                       616           750         
   (18) %    1,967        2,007             (2) %
Capability utilization                            74    %       90   %         (16) %       80   %       86  %          (6) %
Steel shipments (mnt)                            529           608             (13) %    1,651        1,671             (1) %

Average realized price of steel per ton $1,096 $1,517

    (28) % $  1,268     $  1,255              1  %

(a) The mini mill the segment was added after January 15, 2021 with the purchase of the remaining stake in Great River Steel.



The decrease in Mini Mill results for the three months ended September 30, 2022
compared to the same period in 2021 was primarily due to:
•decreased average realized prices, including mix (approximately $260 million)
•decreased shipments (approximately $110 million)
•higher raw material costs (approximately $65 million)
•increased operating costs (approximately $10 million)
•higher energy costs (approximately $5 million).
these changes were partially offset by:
•lower other costs, primarily variable compensation (approximately $25 million),

Gross margin for the three months ended September 30, 2022 compared to the same
period in 2021 decreased primarily as a result of lower average realized price
and sales volume and increased material costs.

The decrease in Mini Mill results for the nine months ended September 30, 2022
compared to the same period in 2021 was primarily due to:
•decreased shipments (approximately $25 million)
•higher raw material costs (approximately $230 million)
•increased operating costs (approximately $40 million)
•higher energy costs (approximately $20 million)
•higher other costs (approximately $5 million),
these changes were partially offset by:
•increased average realized prices, including mix (approximately $30 million),

Gross margin for the nine months ended September 30, 2022 compared to the same period in 2021 decreased mainly due to lower sales volume and higher raw material costs, partially offset by the Company’s partial majority ownership period in Great River Steel in January 2021.

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Sector results for the USSE

                                              Three Months Ended                     Nine Months Ended September
                                                 September 30,             %                     30,                     %
                                               2022         2021         Change          2022           2021           Change
Earnings before interest and taxes ($
millions)                                  $    (32)    $    394            (108) % $     512      $        706            (27) %
Gross margin                                      -   %       34   %         (34) %        17    %           26  %          (9) %
Raw steel production (mnt)                      946        1,274             (26) %     3,250             3,750            (13) %
Capability utilization                           75   %      101   %         (26) %        87    %          100  %         (13) %
Steel shipments (mnt)                           867        1,064             (19) %     3,044             3,274             (7) %
Average realized steel price per ($/ton)   $  1,021     $  1,143             (11) % $   1,121      $        932             20  %

Average realized price of steel per (€/tonne) €1,013 €969

          5  % €   1,049      €        779             35  %



The decrease in USSE results for the three months ended September 30, 2022
compared to the same period in 2021 was primarily due to:
•decreased shipments (approximately $75 million)
•higher raw material costs (approximately $205 million)
•increased operating costs (approximately $50 million)
•higher energy costs (approximately $55 million)
•weakening of the Euro versus the U.S. dollar (approximately $85 million),
these changes were partially offset by:
•increased average realized prices, including mix (approximately $45 million).

Gross margin for the three months ended September 30, 2022 compared to the same
period in 2021 decreased primarily as a result of lower sales volume, higher raw
material and energy costs and negative impacts from the weakening of the Euro
versus the U.S. dollar.

The decrease in USSE results for the nine months ended September 30, 2022
compared to the same period in 2021 was primarily due to:
•decreased shipments (approximately $50 million)
•higher raw material costs (approximately $565 million)
•increased operating costs (approximately $130 million)
•higher energy costs (approximately $180 million)
•weakening of the Euro versus the U.S. dollar (approximately $140 million)
•higher other costs (approximately $20 million),
these changes were partially offset by:
•increased average realized prices, including mix (approximately $865 million)
•increased non-steel sales (approximately $25 million).

Gross margin for the nine months ended September 30, 2022 compared to the same
period in 2021 decreased primarily as a result of lower sales volume and higher
raw material and energy costs, partially offset by higher average realized
prices.

Segment results for Tubular

                                                Three Months Ended                       Nine Months Ended
                                                   September 30,             %             September 30,              %
                                                 2022         2021         Change         2022        2021         Change
Earnings/(loss) before interest and taxes ($
millions)                                    $    155     $      -             100  % $    339     $    (29)          1,269  %
Gross margin                                       37   %        7   %          30  %       33   %        2  %           31  %
Raw steel production (mnt)                        173          117              48  %      497          324              53  %
Capability utilization                             76   %       52   %          24  %       74   %       48  %           26  %
Steel shipments (mnt)                             126          123               2  %      390          317              23  %

Average realized price of steel per ton $3,217 $1,702

     89  % $  2,761     $  1,587              74  %



The increase in Tubular results for the three months ended September 30, 2022
compared to the same period in 2021 occurred despite continued high levels of
imports and was primarily due to:
•increased average realized prices, including mix (approximately $180 million),
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these changes were partially offset by:
•higher raw material costs (approximately $5 million)
•increased operating costs (approximately $5 million)
•higher energy costs (approximately $5 million)
•higher other costs (approximately $10 million).

Gross margin for the three months ended September 30, 2022 compared to the same period in 2021 increased mainly due to higher average realized prices.

The increase in Tubular results for the nine months ended September 30, 2022
compared to the same period in 2021 occurred despite continued high levels of
imports and was primarily due to:
•increased average realized prices, including mix (approximately $395 million)
•increased shipments (approximately $35 million),
these changes were partially offset by:
•higher raw material costs (approximately $25 million)
•increased operating costs (approximately $10 million)
•higher energy costs (approximately $10 million)
•higher other costs (approximately $15 million).

Gross margin for the nine months ended September 30, 2022 compared to the same
period in 2021 increased primarily as a result of higher average realized prices
and sales volume.

Net interest and other financial charges

                                                Three Months Ended                       Nine Months Ended
                                                  September 30,              %             September 30,             %
(Dollars in millions)                            2022         2021        Change          2022         2021        Change
Interest expense                             $       38    $    75              49  % $      127    $   251             49  %
Interest income                                     (15)        (1)          1,400  %        (20)        (3)           567  %
(Gain) loss on debt extinguishment                   (2)        26             108  %          -        282            100  %
Other financial costs                                 9         17              47  %         27         39             31  %
Net periodic benefit income                         (60)       (37)             62  %       (182)       (97)            88  %
Total net interest and other financial
(benefits) costs                             $      (30)   $    80             138  % $      (48)   $   472            110  %



Net interest and other financial (benefits) costs improved in the three months
ended September 30, 2022 as compared to the same period in 2021 primarily due to
the absence of current quarter debt retirement losses, reduced interest expense
from a reduced level of debt and increased capitalized interest and an increase
in net periodic benefit income, primarily due to lower amortization of actuarial
losses.

Net interest and other financial (benefits) costs improved in the nine months
ended September 30, 2022 compared to the same period in 2021 primarily due the
absence of current year debt retirement losses, reduced interest expense from a
reduced level of debt and increased capitalized interest and an increase in net
periodic benefit income, primarily due to lower amortization of actuarial
losses.

Income taxes

Income tax expense was $154 million in the three months ended September 30, 2022
compared to an income tax expense of $260 million in the same period in 2021.
The change from the prior year period was primarily due to a decrease in
earnings before taxes. In addition, the prior year period included a tax benefit
resulting from the release of the valuation allowance on domestic deferred tax
assets.

Income tax expense was $684 million in the nine months ended September 30, 2022
compared to an income tax expense of $224 million in the same period in 2021.
The change from the prior year period was primarily due to the tax benefit in
the prior year period resulting from the release of the valuation allowance on
domestic deferred tax assets.

On July 8, 2022, Pennsylvania House Bill 1342 was enacted, which in part phased
in a corporate net income tax (CNIT) rate reduction over nine years. The CNIT
rate for the 2022 tax year is 9.99%. The CNIT rate will be reduced to 8.99% for
the 2023 tax year. Starting with the 2024 tax year, the rate is reduced by 0.5%
annually until it reaches 4.99% for the 2031 tax year and each year thereafter.
The Company assessed the impact of the law change and recorded an additional
expense of $13 million in the third quarter of 2022 on its Condensed
Consolidated Financial Statements.

net profit

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Net earnings attributable to United States Steel Corporation were $490 million
and $2,350 million in the three and nine months ended September 30, 2022,
respectively, compared to net earnings of $2,002 million and $3,105 million in
the three and nine months ended September 30, 2021, respectively. The changes
primarily reflect the factors discussed above.

CASH AND CAPITAL RESOURCES

Net cash from operating activities

Net cash provided by operating activities was $2,750 million for the nine months
ended September 30, 2022 compared to net cash provided by operating activities
of $2,605 million in the same period in 2021. The period over period increase in
cash from operations from the prior year period was primarily due to changes in
working capital, deferred taxes payable and gains on sale of assets, partially
offset by lower net income, decreases in income taxes payable and losses on debt
extinguishments. Changes in working capital can vary significantly depending on
factors such as the timing of inventory production and purchases, which is
affected by the length of our business cycles as well as our captive raw
materials position, customer payments of accounts receivable and payments to
vendors in the regular course of business.

As shown below our cash conversion cycle for the third quarter of 2022 increased
by 11 days as compared to the fourth quarter of 2021 primarily from increased
inventory days due to higher raw material inventories from quantity and cost.

Cash Conversion Cycle                                      Third Quarter of 2022                Fourth Quarter of 2021
                                                        $ millions            Days            $ millions            Days
Accounts receivable, net (a)                              $2,035               41               $2,089               37

+ Inventories (b)                                         $2,759               61               $2,210               51

- Accounts Payable and Other Accrued Liabilities
(c)                                                       $3,158               68               $2,684               65
= Cash Conversion Cycle (d)                                                    34                                    23


(a) Calculated as Average Accounts Receivable, net divided by total Net Sales
multiplied by the number of days in the period.
(b) Calculated as Average Inventory divided by total Cost of Sales multiplied by
the number of days in the period.
(c) Calculated as Average Accounts Payable and Other Accrued Liabilities less
bank checks outstanding and other current liabilities divided by total Cost of
Sales multiplied by the number of days in the period.
(d) Calculated as Accounts Receivable Days plus Inventory Days less Accounts
Payable Days.

The cash conversion cycle is a non-generally accepted accounting principles
(non-GAAP) financial measure. We believe the cash conversion cycle is a useful
measure in providing investors with information regarding our cash management
performance and is a widely accepted measure of working capital management
efficiency. The cash conversion cycle should not be considered in isolation or
as an alternative to other GAAP metrics as an indicator of performance.

The last-in, first-out (LIFO) inventory method is the predominant inventory costing method for our flat-rolled and tubular segments. Based on the company’s latest internal guidance and inventory requirements, management does not believe there will be any significant permanent LIFO liquidations that would impact earnings for the remainder of 2022.

Net cash used in investment activities

Net cash used in investing activities was $1,065 million for the nine months
ended September 30, 2022 compared to net cash used in investing activities of
$436 million in the same period in 2021. The decrease in net cash used in
investing activities was primarily due to the payment of $625 million in the
prior year period for the purchase of the remaining equity interest in Big River
Steel and proceeds of $53 million in the current year period from government
grants, partially offset by receipt of $627 million in the prior year period for
the sale of Transtar and increased capital expenditures (discussed in more
detail below) and lower proceeds from the sale of assets.

Capital expenditures for the nine months ended September 30, 2022, were $1,138
million, compared with $460 million in the same period in 2021. Flat-Rolled
capital expenditures were $365 million which includes spending for the
construction of a pig iron facility and hot strip mill upgrades at Gary Works,
Keetac direct reduced (DR) grade pellet capability, as well as mining equipment
and other infrastructure, environmental, and other strategic projects across the
Flat-Rolled footprint. Mini Mill capital expenditures were $710 million and
included $445 million for the new Big River 2 (BR2) 3 million ton per year
facility being built in Osceola, Arkansas, as well as spending for the new
continuous galvanizing line (CGL) and non-grain oriented electrical steel
facility being built at the existing Big River Steel facility. USSE capital
expenditures were $53 million and included spending for the blast furnace
stoves, 5-stand control system upgrades, rail bridge upgrades and various other
projects. Tubular capital expenditures were $10 million and included spending to
support steelmaking, infrastructure, and environmental projects within the
Tubular footprint.

Net cash used in fundraising activities

                                      -36-
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Net cash used in financing activities was $752 million for the nine months ended
September 30, 2022 compared to net cash used in financing activities of $2,120
million in the same period last year. The period over period increase in cash
from financing activities was primarily due to higher debt repayments made
during the prior year and current year proceeds from government grants. These
were partially offset by the cash received from common stock issuances in the
prior year period and repurchases of common stock made in the current year
period.

Debt financing

Certain of our credit facilities, including the Credit Facility Agreement, the
Big River Steel ABL Facility, the USSK Credit Agreement and the Export Credit
Agreement, contain standard terms and conditions including customary material
adverse change clauses. If a material adverse change was to occur, our ability
to fund future operating and capital requirements could be negatively impacted.

On September 6, 2022, we closed on an offering of $290 million aggregate
principal amount of 5.450% Environmental Improvement Revenue Bonds due 2052
(2052 ADFA Green Bonds). We received net proceeds of approximately $287 million,
which will be used to partially fund work related to our solid waste disposal
facilities, including two electric arc furnaces (EAF) and other equipment
facilities at BR2. We may from time to time seek to retire or repurchase our
outstanding long-term debt through open market purchases, privately negotiated
transactions, exchange transactions, redemptions or otherwise. Such purchases or
exchanges, if any, will depend on prevailing market conditions, our liquidity
requirements, and other factors and may be commenced or suspended at any time.
The amounts involved may be material. In third quarter 2022, we redeemed
approximately $225 million of our 2029 Senior Notes and $76 million of our 2037
Senior Notes. See Note 15 to the Condensed Consolidated Financial Statements for
further details regarding U. S. Steel's debt.

We use surety bonds, trusts and letters of credit to provide financial assurance
for certain transactions and business activities. The use of some forms of
financial assurance and cash collateral have a negative impact on liquidity. U.
S. Steel has committed approximately $183 million of liquidity sources for
financial assurance purposes as of September 30, 2022. Increases in certain of
these commitments which use collateral are reflected within cash, cash
equivalents and restricted cash on the Condensed Consolidated Statement of Cash
Flows.

Share Repurchases

On July 25, 2022, following the completion of the previously authorized $800
million share repurchase programs, the Board of Directors authorized a new share
repurchase program that allows for the repurchase of up to $500 million of its
outstanding common stock from time to time in the open market or privately
negotiated transactions at the discretion of management. The Company's share
repurchase program does not obligate it to acquire any specific number of
shares. Common stock repurchased under our share repurchase programs totaled
31.6 million shares and approximately $699 million in the nine months ended
September 30, 2022. See Note 22 to the Condensed Consolidated Financial
Statements for further details.

Capital requirements

US Steel’s contractual commitments to acquire property, plant and equipment at September 30, 2022totaled $2.297 billion.

Liquidity

The following table summarizes U. S. Steel's liquidity as of September 30, 2022:

  (Dollars in millions)
  Cash and cash equivalents                                               $ 3,364
  Amount available under Credit Facility Agreement                          

1,746

  Amount available under Big River Steel - Revolving Line of Credit           350
  Amount available under USSK Credit Agreement and USSK Credit Facility       297
  Total estimated liquidity                                               $ 5,757



In the nine months ended September 30, 2022, we received $82 million in proceeds
from government incentives for the construction of BR2, from the sale of tax
credits under the State of Arkansas's Recycling Tax Credit program. The Company
is contingently liable for certain repayment penalties if it fails to meet
certain employment requirements. In addition, the Company received government
grants totaling $53 million for the reimbursement of qualifying project costs
related to the construction of BR2. This amount primarily consists of a
$50 million grant from the State of Arkansas Quick Action Closing Fund. See Note
21 to the Condensed Consolidated Financial Statements for further details.

We finished the third quarter of 2022 with $3,364 million of cash and cash
equivalents and $5,757 million of total liquidity. Available cash is left on
deposit with financial institutions or invested in highly liquid securities with
parties we believe to be creditworthy. Substantially all of the liquidity
attributable to our foreign subsidiaries can be accessed without the imposition
of
                                      -37-
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income taxes following a prior election to liquidate for WE for income tax purposes a foreign subsidiary that owns most of our international business.

We expect that our estimated liquidity requirements will consist primarily of
the remaining portion of our 2022 planned strategic and sustaining capital
expenditures, working capital requirements, interest expense, and operating
costs and employee benefits for our operations after taking into account the
footprint actions and cost reductions at our plants and headquarters. Our
available liquidity at September 30, 2022 consists principally of our cash and
cash equivalents and available borrowings under the Credit Facility Agreement,
Big River Steel ABL Facility, USSK Credit Agreement and the USSK Credit
Facility. Management continues to evaluate market conditions in our industry and
our global liquidity position, and may consider additional actions to further
strengthen our balance sheet and optimize liquidity, including but not limited
to the repayment or refinancing of outstanding debt and the incurrence of
additional debt to opportunistically finance strategic projects. The Company may
also return excess liquidity to shareholders through share repurchases and
dividends from time to time if deemed appropriate by management.

U. S. Steel management believes that our liquidity will be adequate to fund our
requirements based on our current assumptions with respect to our results of
operations and financial condition.

Environmental Matters, Litigation and Contingencies

Some of U. S. Steel's facilities were in operation before 1900. Although the
Company believes that its environmental practices have either led the industry
or at least been consistent with prevailing industry practices, hazardous
materials have been and may continue to be released at current or former
operating sites or delivered to sites operated by third parties.

Our U.S. facilities are subject to environmental laws applicable in the U.S.,
including the Clean Air Act (the CAA), the Clean Water Act (CWA), the Resource
Conservation and Recovery Act (RCRA) and the Comprehensive Environmental
Response, Compensation and Liability Act (CERCLA), as well as state and local
laws and regulations.

US Steel has incurred and will continue to incur significant capital, operating, maintenance and remediation expenditures due to environmental laws and regulations related to the release of hazardous materials, which in recent years have primarily consisted of process changes to meet CAA obligations. and similar obligations in Europe.

EU environmental requirements and Slovak operations

Phase IV of the EU Emissions Trading System (EU ETS) commenced on January 1,
2021, and will finish on December 31, 2030. The European Commission issued final
approval of the updated 2021-2025 Slovak National Allocation table in February
2022. Subsequently, the Slovak Ministry of Environment allocated the full amount
of 2022 free allowances totaling 6.3 million EUA to USSE in February and April
2022. As of September 30, 2022, we have pre-purchased approximately 1.8 million
EUA totaling €118 million (approximately $115 million) to cover the expected
2022 and 2023 shortfall emission allowances.

The EU's Industrial Emissions Directive requires implementation of EU determined
best available techniques (BAT) for Iron and Steel production to reduce
environmental impacts as well as compliance with BAT associated emission levels.
Total capital expenditures for projects to comply with or go beyond BAT
requirements were €138 million (approximately $135 million) over the actual
program period. These costs were partially offset by the EU funding received and
may be mitigated over the next measurement periods if USSK complies with certain
financial covenants, which are assessed annually. USSK complied with these
covenants as of September 30, 2022. If we are unable to meet these covenants in
the future, USSK might be required to provide additional collateral (e.g., bank
guarantee) to secure 50 percent of the EU funding received.

For more details on applicable laws in Slovakia and the EU and their impact on the USSE, see Note 21 to the condensed consolidated financial statements, “Contingency and Commitments – Environmental Matters, EU Environmental Requirements”.

New and emerging environmental regulations

United States and European regulations on greenhouse gas emissions

Future compliance with CO2 emission requirements may include substantial costs
for emission allowances, restriction of production and higher prices for coking
coal, natural gas and electricity generated by carbon-based systems. Because we
cannot predict what requirements ultimately will be imposed in the U.S. and
Europe, it is difficult to estimate the likely impact on U. S. Steel, but it
could be substantial. On March 28, 2017, President Trump signed Executive Order
13783 instructing the United States Environmental Protection Agency (the U.S.
EPA) to review the Clean Power Plan (the CPP). As a result, in June 2019, the
U.S. EPA published a final rule, the "Affordable Clean Energy (ACE) Rule" that
replaced the CPP. Twenty-three states, the District of Columbia, and seven
municipalities are challenging the CPP repeal and ACE rule in the U.S. Court of
Appeals for the District of Columbia (the D.C.) Circuit. A coalition of 21
states has intervened in the litigation in support of the U.S. EPA. Various
other public interest organizations, industry groups, and members of Congress
are also participating in the litigation. On January 19, 2021, the D.C. Circuit
vacated and remanded the ACE to the U.S. EPA, while the CPP remains stayed. On
October 19, 2021, the United States Supreme Court granted petitions for
certiorari filed by the State of West Virginia and others. Oral arguments
regarding the petitions were held before the U.S. Supreme Court on February 28,
2022. On June 30, 2022, the U. S. Supreme Court ruled in favor of West Virginia.
It found that Congress never intended to grant EPA such broad authority to
totally revamp
                                      -38-
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the energy sector; and noted, in particular, EPA's attempt to impose what would
be a cap-and-trade for CO2 has consistently been rejected by Congress. The Court
concluded that Section 111(d) of the Clean Air Act did not grant EPA the
authority to devise emissions caps based on the generation shifting approach the
Agency took in the CPP. There is no direct regulatory impact on U. S. Steel from
this decision.

The Phase IV EU ETS period spans 2021-2030 and began on January 1, 2021.The
Phase IV period is divided into two sub periods (2021-2025 and 2026-2030), rules
for the first subperiod are finalized, however we expect that rules for the
second subperiod may be more stringent than those for the first one. Once
approved, the rules may impact subperiod 2026-2030. Currently, the overall EU
target is a 40 percent reduction of 1990 emissions by 2030. Free allocation of
CO2 allowances is based on reduced benchmark values which have been published in
the first quarter of 2021 and historical levels of production from 2014-2018.
Allocations to individual installations may be adjusted annually to reflect
relevant increases and decreases in production. The threshold for adjustments is
set at 15 percent and will be assessed on the basis of a rolling average of two
precedent years. Production data verified by an external auditor shows that USSE
rolling average for 2020-2021 returned to base limit for hot metal production
resulting in increase of the free allocation for 2022 compared to 2021, however
2022 free allocation was still slightly reduced due to missing the 15 percent
threshold for sinter and coke production. Additionally, lower production in 2019
through 2021 will have an impact on the future free allocation for 2026-2030,
where the historical production average for years 2019-2023 will be assessed.
Based on actual production data for 9 months of 2022, we believe that free
allocation for hot metal will remain unchanged for 2023.

In order to achieve the EU political goal of carbon emissions neutrality by
2050, on July 14, 2021, the European Commission released a package of
legislative proposals called Fit for 55. The proposals contain significant
changes to current EU ETS functions and requirements, including: a new carbon
border adjustment mechanism to impose carbon fees on EU imports, further
reduction of free CO2 allowance allocation to heavy industry and measures to
strengthen the supply of carbon allowances. Legislative process is being
impacted by current Russia-Ukraine crises. The proposals are subject to the EU
legislative process, and we cannot predict their future impact.

United States – Air

The CAA imposes stringent limits on air emissions with a federally mandated
operating permit program and civil and criminal enforcement sanctions. The CAA
requires, among other things, the regulation of hazardous air pollutants through
the development and promulgation of National Emission Standards for Hazardous
Air Pollutants (NESHAP) and Maximum Achievable Control Technology (MACT)
Standards. The U.S. EPA has developed various industry-specific MACT standards
pursuant to this requirement. The CAA requires the U.S. EPA to promulgate
regulations establishing emission standards for each category of Hazardous Air
Pollutants. The U.S. EPA also must conduct risk assessments on each source
category that is already subject to MACT standards and determine if additional
standards are needed to reduce residual risks.

While our operations are subject to several different categories of NESHAP and
MACT standards, the principal impact of these standards on U. S. Steel's
operations includes those that are specific to coke making, iron making, steel
making and iron ore processing.

On July 13, 2020, the U.S. EPA published a Residual Risk and Technology Review
rule for the Integrated Iron and Steel MACT category in the Federal Register.
Based on the results of the U.S. EPA's risk review, the agency determined that
risks due to emissions of air toxics from the Integrated Iron and Steel category
are acceptable and that the current regulations provided an ample margin of
safety to protect public health. Under the technology review, the U.S. EPA
determined that there are no developments in practices, processes or control
technologies that necessitate revision of the standards. In September 2020,
several petitions for review of the rule, including those filed by the Company,
the American Iron and Steel Institute (the AISI), Clean Air Council and others,
were filed with the United States Court of Appeals for the D.C. Circuit. The
cases were consolidated and are being held in abeyance until the U.S. EPA
reviews and responds to administrative petitions for review. U.S. EPA is
required by court order to issue a final rule by October 26, 2023. Because U.S.
EPA has yet to propose a revised iron and steel rule, any impacts are
inestimable at this time.

For the Taconite Iron Ore Processing category, based on the results of the U.S.
EPA's risk review, the agency promulgated a final rule on July 28, 2020, in
which the U.S. EPA determined that risks from emissions of air toxics from this
source category are acceptable and that the existing standards provide an ample
margin of safety. Furthermore, under the technology review, the agency
identified no cost-effective developments in controls, practices, or processes
to achieve further emissions reductions. Petitions for review of the rule were
filed in the United States Court of Appeals for the D.C. Circuit, in which the
Company and the AISI intervened. U.S. EPA is required by court order to issue a
final rule by November 16, 2023. Because U.S. EPA has yet to propose a revised
taconite rule, any impacts are inestimable at this time.

U.S. EPA is in the process of conducting its statutorily obligated residual risk
and technology review of coke oven standards. Because the U.S. EPA has not
completed its review of the Coke MACT regulations, any impacts related to the
U.S. EPA's review of the coke standards cannot be estimated at this time.

In response to Court orders that invalidated prior U. S. EPA determinations
regarding ozone attainment interference, on April 6, 2022, U.S. EPA proposed a
Federal Implementation Plan (that would replace several pending or disapproved
State Implementation Plans) for Regional Ozone Transport for the 2015 Ozone
National Ambient Air Quality Standard. The proposed rule would affect electric
generating units (EGUs) in 26 states and certain non-EGU industries, including,
among several others, coke ovens, taconite production kilns, boilers, blast
furnaces, basic oxygen furnaces, reheating furnaces, and annealing furnaces
                                      -39-
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in 23 states, including those where U. S. Steel has operations. The impacts of
the rule, if promulgated as proposed, could be material. U. S. Steel submitted
comments on the proposed rule on June 21, 2022.

The CAA also requires the U.S. EPA to develop and implement NAAQS for criteria
pollutants, which include, among others, particulate matter (PM) - consisting of
PM10 and PM2.5, lead, carbon monoxide, nitrogen dioxide, sulfur dioxide (SO2),
and ozone.

In October 2015, the U.S. EPA lowered the NAAQS for ozone from 75 parts per
billion (ppb) to 70 ppb. On November 6, 2017, the U.S. EPA designated most areas
in which we operate as attainment with the 2015 standard. In a separate ruling,
on June 4, 2018, the U.S. EPA designated other areas in which we operate as
"marginal nonattainment" with the 2015 ozone standard. On December 6, 2018, the
U.S. EPA published a final rule regarding implementation of the 2015 ozone
standard. Because no state regulatory or permitting actions to bring the ozone
nonattainment areas into attainment have yet to be proposed or developed for U.
S. Steel facilities, the operational and financial impact of the ozone NAAQS
cannot be reasonably estimated at this time. On December 31, 2020, the U.S. EPA
published a final rule pursuant to its statutorily required review of NAAQS that
retains the ozone NAAQS at 70 ppb. In January 2021, New York, along with several
states and non-governmental organizations filed petitions for judicial review of
the action with the United States Court of Appeals for the D.C. Circuit. Several
other states and industry trade groups intervened in support of the U. S. EPA's
action. The case remains in abeyance before the court until December 15, 2023,
as the U.S. EPA voluntarily reconsiders the ozone NAAQS. Because the U.S. EPA
has yet to complete its reconsideration and propose a revised ozone NAAQS, any
impacts are inestimable at this time.

On December 14, 2012, the U.S. EPA lowered the annual standard for PM2.5 from 15
micrograms per cubic meter (ug/m3) to 12 ug/m3 and retained the PM2.5 24-hour
and PM10 NAAQS rules. In December 2014, the U.S. EPA designated some areas in
which U. S. Steel operates as nonattainment with the 2012 annual PM2.5 standard.
On April 6, 2018, the U.S. EPA published a notice that Pennsylvania, California
and Idaho failed to submit a State Implementation Plan (an SIP) to demonstrate
attainment with the 2012 fine particulate standard by the deadline established
by the CAA. As a result of the notice, Pennsylvania, a state in which we
operate, was required to submit an SIP to the U.S. EPA no later than November 7,
2019 to avoid sanctions. On April 29, 2019, the Allegheny County Health
Department (ACHD) published a draft SIP for the Allegheny County nonattainment
area which demonstrates that all of Allegheny County will meet its reasonable
further progress requirements and be in attainment with the 2012 PM2.5 annual
and 24-hour NAAQS by December 31, 2021, with the existing controls that are in
place. On September 12, 2019, the Allegheny County Board of Health unanimously
approved the draft SIP. The draft SIP was then sent to the Pennsylvania
Department of Environmental Protection (PADEP). PADEP submitted the SIP to the
U.S. EPA for approval on November 1, 2019. To date, the U.S. EPA has not taken
action on PADEP's submittal. On December 18, 2020, the U.S. EPA published a
final rule pursuant to its statutorily required review of NAAQS that retains the
existing PM2.5 standards without revision. In early 2021, several states and
non-governmental organizations filed petitions for judicial review of the action
with the United States Court of Appeals for the D.C. Circuit. Several industry
trade groups intervened in support of the U.S. EPA's action. The case remains in
abeyance before the court until March 1, 2023, as U.S. EPA voluntarily
reconsiders the PM2.5 NAAQS. In court filings, U.S. EPA advised the Court that
it intends to complete its reconsideration process by proposing a rule in Summer
2022 and promulgating a final rule in Spring 2023. Because U.S. EPA has yet to
complete its reconsideration and propose a revised PM2.5 NAAQS, any impacts are
inestimable at this time.

On January 26, 2021, ACHD announced that for the first time in history all eight
air quality monitors in Allegheny County met the federal air quality standards
including, in particular sulfur dioxide and particulate matter (PM2.5 and PM10).
Preliminary data from 2021 indicates that all eight air quality monitors
continue to meet the standards. On March 16, 2022, U.S. EPA published a final
rule, a clean data determination, showing that Allegheny County has attained the
2012 annual PM2.5 NAAQS based on the 2018 - 2020 ambient air quality data. Based
on these data, ACHD is in the process of seeking EPA approval to redesignate the
area as attainment with the 2012 annual PM2.5 NAAQS.

For more information on relevant environmental issues, including environmental remediation obligations, see “Item 1. Legal Proceedings – Environmental Proceedings”.

OFF-BALANCE SHEET ARRANGEMENTS

US Steel did not enter into any significant new off-balance sheet deals during the third quarter of 2022.

INTERNATIONAL EXCHANGE

U. S. Steel continues to face import competition, much of which is unfairly
traded and fueled by massive global steel overcapacity, currently estimated to
be over 500 million metric tons per year-more than five times the entire U.S.
steel market and over seventeen times total U.S. steel imports. These imports
and overcapacity negatively impact the Company's operational and financial
performance. U. S. Steel continues to lead efforts to address these challenges
that threaten the Company, our workers, our stockholders, and our country's
national and economic security.

As of the date of this filing, pursuant to a series of Presidential
Proclamations issued in accordance with Section 232 of the Trade Expansion Act
of 1962, U.S. imports of certain steel products are subject to a 25 percent
tariff, except imports from: (1) Argentina, Brazil, and South Korea, which are
subject to restrictive quotas; (2) the European Union (EU), Japan, and the
United Kingdom (UK) that are melted and poured in the EU/Japan/UK, within
quarterly tariff-rate quota (TRQ) limits; (3) Canada and Mexico, which are not
subject to tariffs or quotas, but tariffs could be re-imposed on surging product
groups after consultations;
                                      -40-
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(4) Ukraine, which was granted a one-year tariff exemption until June 1, 2023;
and (5) Australia, which are not subject to tariffs, quotas, or an anti-surge
mechanism.

The US Department of Commerce (DOC) manages a process in which WE
companies may request and/or object to temporary product exclusions from Section 232 tariffs and quotas. US Steel opposes requests for exclusions of imported products that are identical or substitutes for products manufactured by US Steel.

Multiple legal challenges to the Section 232 action continue before the U.S.
Court of International Trade (CIT) and the U.S. Court of Appeals for the Federal
Circuit (CAFC), the latter which has consistently rejected constitutional and
statutory challenges to the Section 232 action.

Since its implementation in March 2018, the Section 232 action has supported the
U.S. steel industry's and U. S. Steel's investments in advanced steel production
capabilities, technology, and skills, strengthening U.S. national and economic
security. The Company continues to actively defend the Section 232 action.

In February 2019the European Commission (EC) has put in place a definitive safeguard measure on world steel imports in the form of tariff quotas which impose 25% customs duties on steel imports that exceed the limit of the tariff quota, in force until June 2024.

Antidumping duties (AD) and countervailing duties (CVD or antisubsidy duties)
apply in addition to the Section 232 tariffs, quotas, TRQs and the EC's
safeguard, and AD/CVD orders may continue beyond the Section 232 action and the
EC's safeguard. U. S. Steel continues to actively defend and maintain the 58
U.S. AD/CVD orders and 14 EU AD/CVD orders covering U. S. Steel products in
multiple proceedings before the DOC, U.S. International Trade Commission (ITC),
CIT, CAFC, the EC and European courts, and the WTO.

In July 2022, the ITC voted to continue the AD/CVD orders on corrosion-resistant
steel from China, India, Italy, South Korea and Taiwan and cold-rolled steel
from China, India, Japan, South Korea, and the UK for another five years, but
voted to revoke the AD/CVD orders on cold-rolled steel from Brazil. In October
2022, the ITC voted to continue the AD/CVD orders on hot-rolled steel from
Australia, Japan, Korea, Netherlands, Russia, Turkey, and the United Kingdom for
another five years, but voted to revoke the AD/CVD orders on hot-rolled steel
from Brazil. Also, in October 2022, the ITC voted to impose new AD/CVD orders on
imports of OCTG from Argentina, Mexico, Korea, and Russia.

In August 2022, the EC imposed definitive AD measures on imports of hot-dipped
galvanized steel from Russia and Turkey and announced the continuation of AD
measures on imports of cold-rolled steel from China and Russia for another five
years. The EC is conducting five-year reviews of the AD/CVD orders on hot-rolled
steel from five countries with a decision expected in 2023.

In April 2022, the United States suspended normal trade relations with Russia
and Belarus, resulting in higher normal tariffs on imports from Russia and
Belarus, including steel and raw materials. In June, President Biden announced
additional tariff increases on certain products from Russia, including certain
steel products and ferroalloys, effective August 1, 2022.

Additional tariffs of 7.5 to 25 percent continue to apply to certain U.S.
imports from China, including certain raw materials used in steel production,
semi-finished and finished steel products, and downstream steel-intensive
products, pursuant to Section 301 of the Trade Act of 1974. The United States
Trade Representative (USTR) is currently conducting a statutory review of the
Section 301 tariffs.

The United States and EU are currently negotiating a global sustainable steel
arrangement to restore market-oriented conditions and address carbon intensity
that is targeted for completion by the end of 2023.

US Steel will continue to execute a broad global strategy to maximize opportunities and address challenges presented by imports, global steel overcapacity, and changing international trade law and policy.

NEW ACCOUNTING STANDARDS

See notes 2 and 3 to the condensed consolidated financial statements in Part I

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