Germany's Steel Federation gave a cautious outlook, saying 2010 would be a very difficult year for the industry despite signs of recovery.

Mr Hans Juergen Kerkhoff president of the Federation said that "The year 2010 may well be again a very difficult year for the steel industry in Germany. But the worst is behind us. We expect a normalization of the steel cycle in 2011 at the earliest."

Mr Kerkhoff said that supply and demand in Germany, the biggest steel making nation in Europe, have now balanced out again on a better level compared with early this year. He added that third quarter new orders were flat year on year, but the recovery was due to an end of destocking.

He said that among risks to steel recovery worldwide are China's structural problems, and the country could again become a net exporter of steel in the fourth quarter. He added that "Given these risks, the outlook is therefore cautious overall."