The chairman, president and chief executive of Cliffs Natural Resources has said that he expects the recession to last at least through next year.
Joseph Carrabba also said he expects "protracted" contract negotiations with customers for its metallurgical coal, a raw material for steel production.
"What you are seeing is nervousness in this economy and a reaction by customers to cuts in the steel industry," Carrabba told market analysts at a meeting.
"This is a difficult time for buyers to come to grips with high coal prices and we expect protracted negotiations."
He said Cliffs would like to have 75-80% of its 2009 coal production committed to a contract price by the end of this year. "Then in 2010, we want to take advantage of the market as metallurgical supplies are short despite steel cutbacks."
Asked about the company's pending acquisition of coal miner Alpha Natural Resources in light of the economic slowdown, Carrabba said: "We have not changed our view of the growth of the steel industry. We believe a super-cycle is here and we are just in a hiccup at the moment.
"We think there will be a long and protracted recession through 2009," he warned....
