Belgrade - Pressed by the global crisis and falling demand, the American giant US Steel would within "consolidation plans" suspend production in Serbia for at least three months in order to save money, a spokesman said Friday.

US Steel Serbia, launched with the purchase of a bankrupted Serbian mill in 2003, already turned off one blast furnace and was set to shut down the other, spokesman Nemanja Brkovic told the Serbian television RTS.

The mill in Smederevo, 30 kilometres east of Belgrade, has no immediate plans to lay off workers and the furnaces would remain in a standby mode until at least until the end of March, Brkovic was quoted as saying. Orders would meanwhile be covered from stock.

The Belgrade daily Blic said the 6,000 employees were however instructed to use a part of their 2009 vacation in the first quarter.

At the production peak, in 2006, US Steel Serbia was the country's top exporter, with sales totalling 667 million euros (963 million dollars) - more than twice than the next two firms combined.

The loss of revenue from exports may put fragile macroeconomic stability in Serbia, a country with gaping trade and current account deficits and a volatile currency, under additional pressure. (dpa)