11- in its Peruvian iron ore operations. By the end of this year the first phase involving the expenditure of 22 million dollars will be completed and will provide the company with a new dock, a downhill conveyor system, and beneficiation facilities that make it possible to treat the hundreds of millions of tons of primary ore that underlie the more limited quantity of direct shipping ore upon which the company has depended to date. Construction has also been started on the second phase of Marcona's expansion program which will require the expenditure of an additional 20 million dollars for the installation of pelletizing facilities, which should be completed by the end of 1962. Marcona will then have the productive capacity which will allow it to increase its sales program to 5 million tons or more, and even now the Board of Directors is giving consideration to the possibility of a third phase involving an expenditure of approximately 10 million dollars and which would make possible sales in excess of 6 million tons annually. Consider if you will Marcona's prospects. It has in hand abundant reserves of high grade iron ore susceptible to simple beneficiation resulting in a premium product. The property near tidewater is blessed by an ideal 12 months' operating season and is uniquely situated to serve the principal steel producing centers of the world. The market for its output is growing rapidly. The Japanese plan to treble their steel capacity, the Europeans to double theirs, and the United States finds that it must depend increasingly on imported iron ores to replace the higher grade domestic ore bodies that are becoming exhausted. Except for whatever political risks may be involved, the future of Marcona appears very bright indeed. Marcona iron ore must move to market by ships, and it is important