SYDNEY, Oct 9 - Mount Gibson Iron Ltd <MGX.AX> said steelmaking customers in China had asked the Australian iron ore miner to delay shipments due to the global financial crisis, triggering a huge drop in its share price on Thursday.

Mount Gibson, Australia's fourth-largest iron ore producer, said a number of its customers had requested delays to shipments, citing declining Chinese steel production.

Its shares dropped 32 percent to a low of 78 cents before recovering slightly to 86.5 cents by 0106 GMT.

Mount Gibson said it would endeavour to reach an acceptable outcome to the requests but had no obligation to agree to them.

A number of customers have requested a delay to shipments scheduled for the second quarter of this financial year, Mount Gibson said.

Economic uncertainty and a tightening in credit conditions have led to a reduction in steel production and a build-up of iron ore stockpiles at Chinese ports, Mount Gibson said.

The company was well placed to modify its operations, expenditure and production targets, if required.

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