SAFETY AND HEALTH
Cliffs' safety systems, which reflect the shared commitment of management and employees to the prevention of incidents and illnesses, continue to pay off in improved performance.

Demonstrating this commitment, Cliffs established an ambitious safe production goal of a 50 percent reduction in the reportable incident rate to 2.0 for 2003. Although the target was not achieved, corporatewide safety performance was again the best in Company history.

The frequency rate as defined by the Mine Safety and Health Administration (MSHA) for total reportable incidents (TRI) was 2.72, an improvement of 31 percent from 2002 and 48 percent from 2001. The frequency rate for lost-time incidents (LTI) was 1.4, a 26 percent improvement from 2002 and 48 percent from 2001.

Cliffs' Northshore Mining Company's mine achieved nearly 1,000 consecutive days without a lost-time incident and was first runner-up for the 2001 and 2002 Sentinels of Safety awards based on the number of hours worked. As the oldest established award for mining safety, the Sentinels of Safety program has promoted a commitment to mine safety and to the continuing development of effective incident prevention programs for more than 75 years. Northshore Mining has also won Cliffs' President's Award for Safety the past three years in a row and four of the six years of the award's existence.

Employees at Cliffs' Technology Center celebrated 26 consecutive years without a lost-time incident on January 31, 2004, a remarkable 2.7 million work hours.

LS&I Railroad also had a tremendous year of improved safety – with one reportable injury, one lost work day and a total reportable incident rate of 0.67 in 2003 compared with seven reportable injuries, 119 lost work days and a total reportable incident rate of 4.89 in 2002.

With continued effort and achievements such as these, Cliffs can achieve its goal of being among the industry's safety leaders.

SAFETY ACCOUNTABILITY AND LEADERSHIP TRAINING
Three years of hard work by the Safety Leadership Team to make safe production a way of life throughout the Company reached a new level in 2003 with implementation of a comprehensive safety-training program. The program consists of a series of five workshops presented over 18 months to develop skills that will help manage the day-to-day safety and incident prevention process.

A workshop on communication was completed at all U.S. operations, and a workshop on incident analysis training is in progress. The three remaining workshops will continue through 2004 and be completed in the first quarter of 2005. Approximately 550 participants, including coordinators, labor committee members, supervisors, managers and top management at each site, are attending the workshops. At the completion of the workshops, all participants will be trained in the Safety Systems of Cliffs.

Meanwhile, safe production training was implemented at the Scully mine in Canada, directed at all supervisors and labor leadership.

Cliffs remains committed to these and other long-term "upstream investments" in incident prevention activities as part of its everyday business. Such investments have resulted in a 57 percent reduction in reportable incidents and a 42 percent reduction in lost-time incidents since the implementation of safe production in 1998.

SAFETY SYSTEM AUDITS
Cliffs' internal safety audit team is currently developing an audit of the current Cliffs Safety System, which will be implemented in 2004, and an audit to measure the effectiveness of the Safety Accountability and Leadership Training.

INDUSTRIAL HYGIENE
Employee response continues to be highly favorable to Cliffs' Internet-based, corporatewide material safety data sheet system, which provides immediate online access to product safety information. Employees at U.S. mining operations have also enthusiastically embraced the Company's commitment to ensure compliance with MSHA's Hazard Communications rule.