It is reported Jiangsu Wujin Stainless Steel Pipe Group Co Ltd produced stainless steel seamless pipe of 3,000 tonnes and stainless steel welded pipe of 2,000 tonnes monthly in January to April 2012.

Source: www.steelhome.cn/en
China steel information centre and industry database

(www.steelguru.com)

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According to statistics, the stainless steel inventory totaled 193,646 tonnes in Chinese Wuxi market in the second 10 days of May 2012, decreasing by 2.91% in comparison of that in 10 days earlier.

Among them, 114,541 tonnes were cold rolled stainless steel, falling by 2.76% and 79,105 tonnes were hot rolled stainless steel, decreasing by 3.13%, both compared to that in 10 days ago.

To specify steel grade, 143,542 tonnes were 300 grades, dropping by 5.5%; 36,052 tonnes were 400 grades, rising by 0.01% and 14,079 tonnes were 200 grades, soaring by 21.63%, all compared to that in the previous 10 days.

Source - www.yieh.com)

(www.steelguru.com)

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A union veteran said that BHP's steel mill at Port Kembla is on the brink. If it dies, Wollongong will die with it.

It was 1981 and Mr Phil Rouse was a newly minted commerce and industrial relations graduate about to enter his cadetship at the sprawling BHP steel plant at Port Kembla in New South Wales.

Then, as now, the steel industry was on its knees hit by recession, world oversupply and competition, and crushed by outdated technology and the rising costs of a labor intensive industry.

During his cadetship, Mr Rouse saw firsthand the massive structural changes that redefined the Australian steel industry. When he started, BHP had more than 20,500 employees at Port Kembla; by 1984 it had shed 35% of its workforce.

A short drive from what is now BlueScope's plant at Port Kembla is the Wollongong office of the Australian Workers Union. Mr Wayne Phillips, a boilermaker by trade and a lifelong union official, was one of the 7000 laid off in the early 1980s. Within a few years he was offered his job back at Port Kembla as the steel industry rebuilt, but not before he and his fellow unemployed workers had stormed Parliament House in Canberra.

Within a year of the Hawke government coming to office in 1983, the industry minister, Mr John Button, secured support for a steel development plan, a bounty system over five years that allowed local steel producers to retain between 80% and 90% of the domestic market. The unions came on board, with undertakings on work practices and improved productivity. BHP committed itself to invest USD 800 million. Steel staggered to its feet, and by 1990 Port Kembla was producing 3.5 million tonnes and employing 9500 people.

But in the past year an oversupply of steel, overseas competition, a stubbornly high dollar and muted domestic demand from the construction sector have again brought steel to its knees. BlueScope closed one of its two operational blast furnaces at Port Kembla and its hot strip mill operations at Western Port in Victoria as it quit the export market to save itself from fatal losses, halving its steelmaking capacity from 5.2 million tonnes to 2.6 million.

Mr Rouse, BlueScope's learning and development manager said that for better or worse he had to call on the experience of 30 years ago as he oversaw the redundancy of 800 workers at Port Kembla and 200 from Western Port.

Two months ago Australia's other steel manufacturer, OneSteel, closed its oil and gas pipe mill at Kembla Grange, taking with it 60 jobs and bringing to an end the company's manufacturing in the area.

BlueScope's external affairs manager Mr Mike Archer said that the company's engineers live for the re linings (reconditioning). He added that "After the project ended there were three engineers who retired, and they had 151 or 153 years of service between them."

Inside the superstructure there's a catch at the back of your throat, sulphur in the air as it escapes from the nearby slag pit. Above, the furnace rises like a rocket, with plugs and tubes feeding in preheated air. Temperatures get up to 2200 degrees.

There are few workers here or in the cavernous hot strip mill that extends for more than half a kilometer. Those on deck are in watchtower control rooms guiding computers and monitoring equipment, eyes glued to screens.

The biggest gathering of steel workers we see is a maintenance crew servicing a trough pronounced trowe into which the molten iron and slag flows from the furnace. Now it takes just 3500 permanent employees and about 1000 contractors to keep the plant operating seven days a week, 24 hours a day.

Spun out of BHP a decade ago, BlueScope and OneSteel have turned out to be among the worst investments in the share market over the past few years. Both have been caught in the crosshairs of surging prices for coal and iron ore, and the strong dollar, which has choked off their access to export markets while fostering cheap imports.

OneSteel has benefited from owning iron ore mines, while BlueScope, which has coalmines on its doorstep in the Illawarra, began looking at buying mines only after prices had surged.

That access to its own iron ore supply, which it also sells abroad, coupled with recent diversification to service the mining industry, has helped OneSteel emerge as one of the market's best performers over the past few months, with its share price close to doubling from recent all time lows about 70 cents. But it remains far short of its highs near USD 7 before the global financial crisis of 2008.

When asked about the continuing viability of the Port Kembla steelworks, Mr Mike Archer rejects the doom and gloom talk, and points to recent capital works at the hot strip mill. He said that "There's a whole lot of investment at Port Kembla and you don't do that unless you think you've got a future."

Source - Sidney Morning Herald

(www.steelguru.com)

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Baltimore Brew said that multiple factors led to the pending shutdown of Baltimore's largest industrial facility. Here are some of the key ones.

Barring a last minute infusion of cash by bankers or owner Mr Rennert or an improbable sale to a new company RG Steel and its flagship plant, Sparrows Point, seem fated for a sad ending.

Sparrows Point' fall began in the 1960s (when the mill employed 30,000 workers) and has continued with little interruption to now (when the mill employs fewer than 2,500) triggered by technological and market changes that a succession of managers and union officials were unwilling and perhaps unable to surmount.

Here are six of them:

1. Osolete facilities - Sparrows was established a century ago on marshlands 10 miles from downtown Baltimore as an integrated steelmaker.

It took the raw materials of iron ore, coal and limestone and smelted them through a series of complex processes into standard grade sheets, pipe, wire, nails and other finished steel products.

Today, the whole made from scratch approach is obsolete in the US. Successful steelmakers such as Nucor operate electric arc furnaces and compact casters to produce market-specific, high grade products.

Sparrows' massive L blast furnace is now 35 years old and, even worse, its 68 inch hot strip mill dates back to 1947. Employees have made heroic efforts to keep these antiques running. But it's a losing game.

2. Poor Strategy - In his first letter to employees a year ago on April 1 (a poor choice of dates), RG Steel's CEO Mr John Goodwin said that learning to embrace change was the company's greatest challenge. He said that "If we continue to do business as usual, we will repeat history and the hardships of the past will be revisited."

Repeating history is exactly what Mr Goodwin and his top lieutenant, Mr Glenn Mikaloff, did. They ran the plant just like prior owner Severstal, thinking they could supply steel slabs to the Ohio and West Virginia mills at low cost. It didn't work under Severstal, and it didn’t work under the punishing economics of the last year.

Late in the game, Mr Goodwin tried to change course. He shut down Sparrows Point’s tinplate mill in April (after spending several million dollars in improvements) and tried to operate the L blast furnace so that it gushed less red ink. It was too little, too late.

3. Remote Owner - Mr Ira Rennert, the billionaire financier and Hamptons mega mansion owner, didn't put his money into RG Steel (which he owns by virtue of his control of family firm The Renco Group.) He let a consortium of banks extend a credit line.

When the banks balked at RG Steel's huge losses last fall, up to USD 1 million a day, The Brew reported Mr Rennert chipped in a little and got Cerberus Capital Management to lend RG Steel more.

Mr Ira's not only stingy, he's remote. On occasion he has toured Sparrows Point in a golf cart with his minions, but he has never uttered a public word about the mill nor informed his employees and customers of his strategic intentions. The deafening silence from the Hamptons makes one wonder if he bought Sparrows for something other than profit. Perhaps a tax write off.

4. Head in the sands union - The United Steelworkers of America, led by Mr Leo Gerard, Mr David McCall and Mr Tom Conway, has executed disaster after disaster.

First the triumvirate allowed billionaire Mr Wilbur Ross to dump Beth Steel's pension and health care benefits in 2002-03, which hurt tens of thousands of retirees and widows, many from Sparrows Point.

Then they played nice with London based Mr LN Mittal (owner of ArcelorMittal), who operated Sparrows Point without putting in a dime of new investment, and then roped in Russian Mr Alexei Mordashov (oligarch of Severstal), who purchased the plant from Mittal.

Mr Mordashov did invest in the plant, but the union turned on him when he insisted on work rule changes and job cutbacks. As a crowning achievement, the International picked Rennert as the next buyer of Sparrows Point and Warren.

Mr McCall brushed aside suggestions that he cultivate other potential buyers (such as Argentina's Ternium group) or sell Sparrows Point separately from the Midwest mills. McCall wanted Rennert and Rennert he got, a man whose last foray into the steel business resulted in the bankruptcy of the USW represented Warren plant.

Mr Gerard, Mr McCall and Mr Conway remain ensconced in union headquarters in Pittsburgh and Columbus, Ohio, three spoiled satraps as distant from their membership as Rennert is from his steel company.

5. Lousy Location - Sparrows Point was established in the 1880s to manufacture steel from iron ore cheaply transported by water from Cuba. Over the next 100 years, the company opened captive mines in Chile, Venezuela, Liberia and Labrador, seizing on the mill’s unique location as a deepwater Atlantic port.

Then Beth Steel sold off the properties for cash, leaving Sparrows Point subject to the vagaries of the spot ore market and squeezed by high prices. To make matters worse, the mill has suffered from the Northeast’s descent as a manufacturing powerhouse and steel-consuming center. The Point remains the only integrated steel mill in the East, and way too dependent on depressed and declining markets.

6. Scaring Away Customers - RG Steel managed to shut down (due to nonpayment of its vendors) right when the annual orders for tinplate sales were being finalized last December. That disruption plus a fire that stopped tinplate production in September 2011 sent customers scurrying to the exit doors.

There was just so much they could take, even when RG Steel was making sales by selling at a loss.

A Final Observation: Politics

Yes, the mill has suffered through one of the worst steel markets in memory. Finished steel prices remain stubbornly low, while raw material costs, which consume about 85% of the plant’s overall cost structure continue to be high.
But offsetting market forces has been the interfering hand of politics.

Maryland officeholders have played a crucial role in keeping Sparrows Point open, and steelworkers working, in the last two years.

Back in December 2011, when the plant shut down, Governor Mr Martin O'Malley rallied to its aid and helped engineer relaxed credit terms by the bank consortium and a cash infusion by Cerberus.

The same thing had happened in 2010 when Team Maryland, as US Senator Barbara Mikulski liked to call her Democratic colleagues in the state, propped up The Point when Severstal was threatening to close the plant.

Politics again may come to the fore to save this company the Obama White House does not want to face several thousand laid off RG Steel employees voting in the battleground state of Ohio next November.

In other words, the Steelworkers union and Democratic polls will remain players in the fate of the mill. But in the end, both now or in the foreseeable future, economics will win out, and southeast Baltimore County will have to adjust to a brave new world without Sparrows.

Source - Baltimore Brew

(www.steelguru.com)

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In '000 tonnes

Source - worldsteel

(www.steelguru.com)

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NW Times reported that when striking union members who worked at the Republic Steel plant tried to picket near the plant gates 75 years ago, Chicago police used force to drive them back, sending more than 100 to the hospital and 10 to the morgue.

But when organized labor supporters on Saturday marched to where the steel mill used to be near 118th Street and Avenue O to pay tribute to the 10 steelworkers who died, they had a Chicago police escort to ensure no one was hurt.

About 100 people gathered at Washington High School, 3535 E. 114th St., for a daylong series of events that included a forum and panel discussion about the Republic Steel "massacre." Activities also included a rally attended by U.S. Rep. Jesse Jackson Jr., D-Ill., that ended with the peaceful walk to the site where a memorial to the deceased workers was placed, across the street at The Zone youth center, 11731 S. Ave. O.

People who participated in the Saturday events were told that on May 30, 1937, police refused a request by union members to allow them to “peacefully picket” at the steel mill gate, and also that the union members were “not able to defend themselves” from police attacks.

Source - NW Times

(www.steelguru.com)

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Mr David Makman of Managing Intellectual Property considers what a decision by Nippon Steel to sue a Korean business for JPY 100 billion in a trade secrets case says about the way Japanese companies deal with IP

For the past few decades, Japanese companies have been expanding their business in Asia, while their own domestic economy has not been growing. The yen, though down recently, is relatively strong, and margins are getting tighter. In this context, Japanese companies have encountered a problem: when doing business in Asia, they would like to be able to maintain high margins as compensation for the expensive and risky R&D costs that they have incurred, but when they try to take advantage of the lower costs available from moving their manufacturing to other parts of Asia, they wind up transferring technology abroad and training their best competitors. In effect, they are creating strong long term competitors in return for increased short term profits.

For decades now, the Japanese have relied on technology transfer fees and joint venture deals to capitalize on their technological advantages. In addition, since patent protection is relatively weak in Asia and Japan, Japanese companies have relied heavily on trade secret protection domestically and internationally to protect their IP rights. There are two major long-term problems with relying on trade secret protection. First, once the secret is out, the competition knows it and there is no way to make it secret again. Second, one needs to rely on contract law for protection. Yet in Asia contract law is sometimes not so rigorous, and it is difficult to rely on contract law alone to protect intangible property rights. One can’t help thinking that Japanese companies need to do something differently if they want to capitalize on their strength and leadership position in technology.

In contrast, many Korean companies have chosen to rely on patent law and on patent litigation to protect their competitive edge. Indeed, Korean companies have been willing to litigate patent cases all over the world; from the US and Europe to Korea and even Japan. These companies have big patent portfolios and insist on collecting patent royalties when they can. The system seems to be working fairly well for the Koreans and their technology companies seem to be strong and growing even stronger.

In this context, the recent dispute that broke out between Nippon Steel and its South Korean partner, POSCO is very interesting. Nippon Steel has filed a trade secret misappropriation suit in Japan, asking for JPY 100 billion in damages. Nippon Steel filed this suit even though Japanese companies are, purportedly, culturally averse to litigation. Moreover, Nippon Steel filed suit even though POSCO was a business partner. And, most importantly, the claimed damages are simply unprecedented. This writer is not aware of any precedent for winning and collecting even a USD 100 million IP infringement award in Japan. Therefore, Nippon Steel’s decision to seek over a billion dollars, in a country that where the courts award attorney fees to the winner of litigation and where they charge variable filing fees based on the amount of damages sought, is simply remarkable.

Many questions immediately arise, such as: why did they file this suit? What are they trying to get from it, and do they honestly think that they can obtain relief on this scale from the Japanese courts? Only time will tell. Thus far, there have not been many strong successes by Japanese IP holders that one can point to in support of the argument that Japanese are able to use litigation as a tool to monetize their IP. Indeed, Sony settled its worldwide patent war against Korea’s LGE. In addition, Funai, which filed a high profile patent litigation in the ITC was later sued by its lawyers, Morrison & Foerster, for failing to pay the bill for the litigation. (Apparently, although the company won a ruling of infringement, the defendants were then able to successfully design around the patent.) Indeed, the most successful strategy for Japanese companies may be selling their patents to US non practicing entities (a strategy that seems to be increasingly common).

At this point, we can only speculate as to Nippon Steel's motivation and objectives. But, over time, this high profile dispute will be resolved and we will get a better glimpse into the 21st century IP strategy of this important Japanese company.

Source - Managing IP

(www.steelguru.com)

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Congressman Mr CA Dutch Ruppersberger has issued the following statement on job losses announced by Sparrows Point steel plant owner RG Steel:

"I am deeply troubled by the potential impact this news will have on the dedicated men and women at the Sparrows Point plant. I have been proud to represent the workers who have helped shape Baltimore's industrial identity for more than 15 years, first at the county level and now at the federal level."

"For more than a century, the plant has produced steel that has literally built our country. My father worked at this plant when it was Bethlehem Steel and, time and time again, the men and women of Sparrows Point have rallied under the most frustrating of circumstances. I am hopeful that efforts to sell the plant will be successful. I will closely monitor the situation so that all of its workers receive the answers and assistance they deserve."

The continued success of the Sparrows Point steelmaking operation is not only important to Maryland, but the national economy. In Congress, I have been working with US trade officials to develop relationships with raw materials producers overseas. Unfair export restraints on important raw materials are putting American manufacturers at a competitive disadvantage. This week's news is one example of why we must continue to fight for even playing ground in markets around the world."

Source - Dundalk

(www.steelguru.com)
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In ‘000 tonnes

Source - worldsteel

(www.steelguru.com)


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Croatia based steelmaker Adria Steel has announced that it has started testing a rolling mill in its Split steelworks to produce rebars.

The steelmaker expects to make the first deliveries from the mill once testing is completed. Following commissioning works and ramp up of production, a total of 200 workers will be working in three shifts at the mill by the end of September 2012.

The rolling mill in Split previously belonged to Zeljezara Split. The renovation at the mill started in December 2011 when Adria bought Zeljezara Split.

Source - Visit www.steelorbis.com for more

(www.steelguru.com)

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