Albert
ArcelorMittal to cut steel output {draw:frame} Published: November 5, 2008 {draw:frame} ArcelorMittal also reported a net profit of $3.8 billion for the third quarter, up 29 percent from a year earlier, but well below the nearly $6 billion analysts surveyed by Reuters and Bloomberg News had been expecting. Revenue rose 38 percent to $35.2 billion. Like its counterparts in Japan, China and Russia, ArcelorMittal is reducing capacity as its customers encounter difficulties of their own. The World Steel Association said last month that global production fell 3.2 percent in September from a year earlier, to 108.4 million tons. Output in China, the biggest producer and consumer of steel, fell 9 percent in the month. The global construction industry, the largest consumer of steel, is in a deep funk. And the auto industry, another major user of the metal, is suffering through one of its worst downturns in decades, suggesting that demand will remain weak. In fact, the steel market so deteriorated in the third quarter that the steel association in October pulled its short-term forecast, citing "high economic uncertainty." Alexandre Weinberg, an analyst at Petercam in Brussels, predicted that steel prices in 2009 would average about 30 percent below 2008 levels. The company's shares fell 16.1 percent in Amsterdam. They are down 61 percent so far this year. Weinberg said the decline Wednesday reflected disappointment with the company's guidance for earnings in the fourth quarter: $2.5 billion to $3 billion, much worse than the $4.5 billion to $6 billion analysts had been projecting. The company said it would cut output of flat carbon steel, used for construction and making autos, by more than 35 percent in the United States and by more than 30 percent in Europe. The company will cut output in Asia, Russia and Africa by more than 35 percent over all. The production cuts represent a major reversal for ArcelorMittal, which had said that it would increase output about 20...
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