Mittal Steel Co., Arcelor SA and Nippon Steel Corp. may have lower profits next year as rising Chinese steel production increases the cost of iron ore. The world's top five steelmakers may have an average decline in net income of 15 percent in 2006, according to polls of analysts from Thomson Financial, Toyo Keizai and Bloomberg. That's the first drop in at least four years. Output in China, producer of a third of the world's steel, will probably grow 25 percent this year, the fastest pace in nine years, according to a Bloomberg analyst survey. That may push up the cost of iron ore 20 percent to a record in 2006, says Morgan Stanley's London-based analyst Wiktor Bielski. It may push down steel prices as much as 27 percent, says ABN Amro Holding NV's Michael Sones in London
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