FEARS over the future of the steel industry on Teesside grew last night after Corus, formerly British Steel, announced disappointing half-year results.

The company blamed the high value of the pound for continuing losses in its business, and raised the prospect of more job losses to improve efficiency.

The group, formed by the merger of British Steel and Dutch company Hoogovens last year, said efficiency benefits already achieved had been eroded by the strength of the pound against the euro.

And the company, which announced 1,430 job losses earlier this month, including many at the British Steel Research Centre in Middlesbrough, struck an ominous note on future job prospects.

Chairman Sir Brian Moffat said: "Job reductions and closures of plants are always a matter of regret.

"However, the serious erosion of the competitive position of the group and its customer base in the UK, as a result of the strength of the pound against the euro inevitably means further difficult decisions will have to be taken."

The news will be another blow for the estimated 5,000 families relying on Teesside's massive Corus plants for their livelihoods.

But the Iron and Steel Trades Confederation (ISTC) general secretary Michael Leahy urged Corus to think of the industry in the long-term, and rather than reacting to short-term problems.

He said: "Corus have indicated that there maybe hard decisions ahead by which we assume they mean more job losses.

"I would remind the company that we have worked with them in partnership with them to make Corus the most productive company in Europe and the company should take the long-term view and hold on though the current short term difficulties so they are fit to expand and grow,

"The worse thing they can do is cut jobs and plants now. That would be pure short-termism."

Mr Leahy met with Trade and Industry Secretary Stephen Byers last week to express the union's concerns, and Mr Byers is expected to meet with Corus management within the next week.

Sir Brian's comments came as the company reported a pre-tax operating loss of £113m in the six months to April 1.

The figure was lower than the previous year's loss of £250m. Turnover was up at £4.6bn, from £2.8bn reflecting the first contribution from the merger with Hoogovens.