Consolidated revenues for its coal and iron ore businesses tumbled 61%.

The company posted an operating loss of $US17.3 million, stark news when compared to income of $409.4 million in last year’s second quarter.

Cliffs said operating income had decreased due to lower sales volumes and price realisations, and that margins were lower as a result of idle costs and reduced North American production levels.

"Cliffs continues to manage its businesses through the economic downturn and position the company for a resurgence in steel demand in the US and Europe,” Cliffs chairman Joseph Carrabba said.

“We have begun to see signs of stabilisation in the North American steelmaking industry and continue to balance production with current demand, with the second quarter likely marking a low point in production for 2009. In the meantime, we continue to look for opportunistic ways to advance our strategy to diversify the enterprise in terms of geography, minerals and end-markets.”

The company’s North American coal segment took some hits in the period, selling 289,000 tons at average per-ton revenues of $93.77. Last year’s second-quarter volumes were nearly double, at 576,000t, but at a slightly lower price of $91.67/t.

Looking ahead, the company has cut the production guidance for its North American mines from 2 million tons to 1.5Mt.