India’s Tata Steel says it is cutting steel output at its Corus unit in the UK and the Netherlands to cope with a fall in demand.

It plans to cut steel production by up to 20% over the next three months or by about 1 million metric tonnes.

Corus chief executive Philippe Varin said that demand for the raw material had been hit by the “consequences of the global financial crisis”.

No change in Tata’s production levels is expected outside Europe.

“We are taking appropriate steps to optimise our operations and protect our sound financial position over the next few months,” Mr Varin said.

The price of steel, along with the price of other raw materials such as oil and metals, has been falling in the past three months on fears that a global slowdown will lead to lower demand.

These fears have intensified in recent weeks as the impact of the financial crisis on the wider economy becomes clearer.

Corus is Europe’s second-largest steel producer, with annual revenues of more than £12bn.

News reported by The BBC

ArcelorMittal, the world’s largest steelmaker, has seen second-quarter profits more than double after it managed to increase prices.

Profits were $5.8bn ($2.9bn) in the three months to 30 June, compared with $2.7bn a year earlier.

The company said it had achieved “significant” price increases in contracts which had been renegotiated.

It also added that efforts to secure its own access to raw materials amid sky-high global prices were paying off.

The company now supplies 45% of its own iron ore and 20% of its own coking coal.

“We continue to look for opportunities to further enhance our raw material self-sufficiency, with recent investments being announced in Africa, the Americas and Australia,” said Arcelor chairman and chief executive Lakshmi Mittal.

Steel shipments rose only slightly to 29.8 million metric tonnes.

The firm said global demand for steel was losing pace, with Arcelor forecasting growth of 3 to 5% this year, down from 7% in recent years.

The world’s largest steelmaker by volume, the firm was created by Mittal Steel’s 2006 takeover of Arcelor. The group employs 310,000 staff.

News reported by The BBC