takeover, page-11

I am not sure the global steel outlook is as rosy as you claim. JID's data is correct. Prices are falling; scrap is the leading indicator.

From the wires this morning......

FerroChina Ltd., a Chinese steelmaker, said it is unable to repay loans totaling 706 million yuan ($104 million) because of the ``current economic crisis,'' and a further 4.52 billion yuan in loans and notes may also be at risk. Production at FerroChina's plants has been suspended and the mill is in talks with creditors and potential investors, the company said today in a statement to the Singapore Stock Exchange. Steel prices and demand in China have been declining. ``Due to the current economic crisis, the group is unable to repay part of its working capital loans aggregating approximately 706 million yuan which has become due and payable,'' the statement said. ``The management is seeking new equity and loan funding.'' Further loan facilities and notes of about 2.03 billion yuan and ``some other working capital loans'' totaling 2.49 billion yuan may potentially become due, it said.

Baoshan Iron & Steel Co., China's biggest steelmaker, will run down inventories of the metal in the final quarter of the year by boosting sales to try and offset lower prices, according to a company newsletter. ``The pressure and challenge that we are facing are unprecedented,'' the Shanghai-based company said in the regular newsletter, citing an Oct. 7 internal staff meeting. Chinese mills have slowed production as the global credit crunch and slowdown in economic growth have curbed demand from automakers and builders. Baoshan Chairman Xu Lejiang said on Sept. 18 that orders are declining. Steel mills in China, the world's biggest producers, are cutting demand for iron ore and asking miners to postpone deliveries because of slower sales, Australian producer Mt. Gibson Iron Ltd. said today. Hebei Iron & Steel Group and three other steelmakers in northern China will cut output by 20 percent this month, the official Xinhua News Agency has reported.