Exhibit 18

May 14, 2001


The Board of Directors
National Steel Corporation



Note 2 of notes to the consolidated financial statements of National Steel
Corporation included in its Form 10-Q for the quarter ended March 31, 2001
describes a change in the method of accounting for investment gains and losses
on pension assets for calculation of net periodic pension cost. Previously, the
Company's actuary used a method that recognized all realized gains and losses
immediately and deferred and amortized all unrealized gains and losses over five
years. Under the new accounting method, the market value of plan assets will
reflect gains and losses at the actuarial expected rate of return. In addition,
the difference between actual gains and losses and the amount recognized based
on the expected rate of return will be amortized in the market value of plan
assets over three years. There are no authoritative criteria for determining a
"preferable" method of accounting for investment gains and losses based on the
particular circumstances; however, we conclude that such change in the method of
accounting is to an acceptable alternative method which, based on your business
judgment to make this change and for the stated reasons, is preferable in your
circumstances. We have not conducted an audit in accordance with auditing
standards generally accepted in the United States of any financial statements of
the Company as of any date or for any period subsequent to December 31, 2000,
and therefore we do not express any opinion on any financial statements of
National Steel Corporation subsequent to that date.



                               Very truly yours,



                               Ernst & Young LLP