July, 20 2005
Mining firms rush to dig up Jharkhand
The mining and processing sector in Jharkhand has attracted investment proposals worth nearly Rs 26,900 crore in the last year or so
The agreements already signed by the Jharkhand state government in the forms of MoUs include the Jindal Steel and Power project worth Rs 12,500 crore, Vallabh Steel unit for Rs 141.29 crore, Adhunik Alloy & Power for Rs 415 crore, Nillachal Iron & Power of Rs 250 crore, Chattisgarh Electric Co for Rs 641 crore, TechAI Corporation (USA) for Rs 6,500 crore, Poddar Projects of Rs 160 crore, Abhijit Infrastructure worth Rs 350 crore, Monnet Ispat of Rs 1,400 crore and Ispat Alloys for Rs 148 crore
Very recently, another MoU was signed between the state government and Essar Steel for a three million tonne steel plant which would require an investment of Rs 4,285 crore.
However, the ongoing race to get mining licences for iron ore and coal in Jharkhand was continuing unabated even now.
Several companies have teams camping in the state capital working on draft memorandum of understanding (MoU) to be signed with the state government for exploitation of iron ore and coal deposits in the state through mines.
The Jindal and Mittal groups have already expressed their interest in setting up greenfield projects in Jharkhand.
The Essar Group has indicated that it would be importing two mills from its recently acquired Korea-based enterprise, HanboSteel, to set them up at a new proposed plant in the West Singhbhum district of Jharkhand. Essar Steel has decided to import the four million tonne steel plant in a knocked down condition by sea. The equipment would be finally installed at a proposed steel plant at Manoharpur in West Singhbhum district
India iron ore exports seen steady at 78 mln tonnes
India, the world's third-largest iron ore supplier, will export 78 million tonnes in the year to March 2006, matching last year's level despite fewer enquiries from China, the country's top exporter said on Tuesday.
S.D. Kapoor, chairman of state-owned MMTC Ltd., said about three-quarters of India's iron ore exports would be shipped to China, the world's top steel producer and consumer, where fast-growing demand has boosted India's sales in recent years.
Though Kapoor said China was demanding less ore from India than last year, he said this would not mean a reduction in India's shipments, as transport bottlenecks had prevented the country from meeting all of China's demand last financial year.
MMTC Ltd. alone expects its iron ore sales to grow 10 percent to about 13 million to 13.5 million tonnes in the year to March 2006, Kapoor said.
The firm, also India's top gold importer, exports 40 percent of its iron ore on a long-term contract basis and the balance in the spot market.
As a whole, India sells about 80 percent of its ore in spot deals, unlike top producers Australia and Brazil, which have term contracts with their buyers.
"Not more than 15 million tonnes would have gone under long-term contracts last year," Kapoor said, referring to Indian exports to China.
Indian spot ore prices have fallen by nearly 40 percent since early April, after weakening steel prices slowed down purchases by Chinese mills. But Kapoor said it was still profitable for iron ore mining firms to sell at current market prices.
Indian Railways register increase in freight revenue
The Indian Railways have earned Rs 8569.07 crore of revenue freight during the first quarter of the current financial year ending June 2005 as compared to Rs 7160.75 crore during the corresponding period last year.
According to officials, the earnings from Railways freight during the month of June, 2005 was Rs 2796.44 crore from 52.40 million tonnes (MTs) of revenue freight as compared to Rs 2621.27 crore from 46.97 million tonnes of such traffic during the corresponding period of the previous year, which amounts to an increase of 6.7 per cent in rupee terms and nearly 11.6 per cent in terms of million tonnes.
80 MT coal shortage by 2011-12
Despite an ambitious growth projection by Coal India Ltd (CIL), the country will face a deficit of 80 million tonne of coal by the end of the eleventh Five Year Plan, according to Union Coal Secretary P C Parikh.
A two-pronged approach has been adopted to boost production of these companies, he informed, adding, capacity production of major mines and new open cast coal projects would be the focus areas.
According to Parikh, the government also expects substantial contribution from private coal producers who have been allotted 85 blocks in the country for captive mining. Coal production from private mines grew to 12 million tonne last fiscal from eight million tonne the previous year, he disclosed.
According to Parikh, the country is currently facing a shortfall of about 20 million tonne of coal, which has forced the major consumers to import coal from Australia, Indonesia, Africa and other countries.
Tata Sponge to invest Rs 800 cr in Orissa
Tata Sponge Iron has lined up an investment of Rs 800 crore for capacity expansion at the existing premises at Bilaipada near Joda, in the Keonjhar district of Orissa.
This would take the capacity of the plant to 8.4 lakh tonne per annum, an increase of 115 per cent.
The total investment would be to the tune of Rs 800 crore, out of which, 25 per cent would funded through internal accruals and the balance would be debt funded. We are not looking at equity funding said Pandit.
The plant was initially designed for a production capacity of 90,000 tonne per annum which was enhanced to 1,20,000 tonne per annum through various modifications during 1990-91. Later, to cater to the growing demand of quality sponge iron, Tata Sponge doubled its capacity by adding another kiln of equivalent capacity in 1998-99
Tata Sponge was incorporated in 1982 as a joint venture of Tata Steel and the Industrial Promotion & Investment Corporation of Orissa Limited (IPICOL). Later during 1991, Tata Steel acquired IPICOLs stake and at present Tata Sponge is a sister company of Tata Steel.
It was set up for the production of sponge iron based on the Tisco direct reduction (TDR) technology.
Core growth...Civil Aviation, Road outshine others
Reviewing the performance of the infrastructure sectors in the country, the Government said on Monday that Civil Aviation and Road sectors posted phenomenal growth during April-May 2005-06 among all the core industries.
The latest report by the Ministry of Statistics and Programme Implementation said that except Telecom, Fertilizers and Petroleum, all the other sectors also registered a significant growth in the first two months of the current fiscal.
The Road sector grew by 25.4% during the period compared with the same period last year. In Civil Aviation, passengers handled at domestic airport terminals rose 19.7% while passengers handled at international airport terminals were up 12.6%.
Export as well as Import cargos handled at airports also registered a double digit growth. Export cargo handling totaled 79,641 tons while import cargo handling stood at 47,840 tons.
Telecom continued to record a negative growth rate with addition in switching capacity going down by 41.8%, while landline connections falling 58.8%. Cellular mobile phone connections jumped 14.8% as consumers surrendered landline connections and switched to wireless phones. Thus, telephony remains a cause for concern, the report states.
In Petroleum, except Natural Gas, which posted a growth of 1.4%, Crude Oil production and Refinery output contracted by 1.2% and 6.9%, respectively. Fertilizers production also shrank 4.2% with the total production being 2.21mn tons.
Cargo handled at major ports went up by 16.6% with the total being 68.13mn tons. Revenue earning Railway Freight Traffic went up by 14% at 107.58mn tons.
Production of Cement totaled 24.2mn tons, up 9.6% while Steel production grew by 7.6% to 6.73mn tons. Coal output, at 61.21mn tons showed a growth of 7.9% while the Power sector recorded a rise of 6.5%, with a generation of 103.26bn units.
Performance wise, all sectors except Coal, Finished Steel, Fertilizers and Refinery, have exceeded their targets, the report says
Jharkhand extends Tata lease for 30 years
Jharkhand has decided to extend the lease of Tata Steel for 30 more years, sorting out a four-year-long issue.
A high level meeting took place here on Monday evening that was attended by Chief Minister Arjun Munda, Finance Minister Raghubar Das, senior government officials and Tata Steel chief managing director B. Muthuraman.
After the meeting, Munda told reporters: "The government has decided to extend the lease of Tata Steel for 30 more years. The district administration of Jamshedpur has been asked to prepare the lease renewal draft by Aug 15."
Munda claimed that Tata Steel had agreed to pay Rs.1.5 billion to help with the construction of a mega sports complex for the national games here in 2007. "The state has had relations with the Tata Group for the last 100 years. And the government has decided to continue the relations so investors can have confidence in the state," he said.
The contentious issue was schedule IV of the lease under which the Tatas had allegedly subleased the land to other people without taking the government into confidence. The lease agreement had categorically said the company could not sublease the land to a third party.
The state government had demanded Rs.1.35 billion from Tata Steel as penalty. The Tatas moved high court. And the issue is still pending there. "If the Tatas are asked by court to pay Rs.1.35 billion, then the amount of Rs.1.5 billion that will be donated for the sports complex will be compensated," claimed a Tata official.
Exports to drive volume growth of ISMT
Exports are expected to drive the volume growth of Indian Seamless Metal Tubes. While in FY04 the company's export figures were $15 million, they grew upto $30 million in FY05, and for the current year the company is expecting the export figures to touch $60 million
Rajiv Goel, Joint MD, Indian Seamless Metal Tubes and Indian Seamless Steel & Alloys believes that an increase in exports this year will drive the volume growth for Indian Seamless Metal Tubes, ISMT.
He says, "ISMT's exports were $15 million in FY04, and they grew upto $30 million FY05. For the current year we are looking at exports to touch $60 million. This is what is going to drive the volume growth of the company."
Fresh twist to Posco row
The ruling BJD has put the Opposition Congress on the mat today by observing that instead of staging demonstrations against the Posco project in Orissa, the Congress leaders observe dharna in front of Mrs Sonia Gandhi and PM Mr Manmohan Singhs residence.
Exposing the hollowness in the state Congress leaderships protest against the mega steel plant, BJD secretary general and Panchayati Raj minister Dr Damodar Rout said that the project had been cleared by the Congress-led UPA government at the Centre.
Feeder units leaving Punjab
Disappointed at the bureaucratic red tape, over 500 units of the wire-drawing industry in Punjab are planning to shift base to Himachal Pradesh. Several industrialists are learnt to have visited Damtal (near Pathankot) and Baddi to explore possibilities of setting up manufacturing units there.
The policies of the Punjab Small Industries and Export Corporation (PSIEC) and Rashtriya Ispat Nigam Ltd (RINL) are not in the interests of the industry. Besides recession, problems like insufficient power supply and poor infrastructure are hitting the industry in Punjab, says Badish K Jindal, general secretary of the Wire-Drawing Federation of Punjab.
Wire-drawing units supply wire rods, the basic raw material, to most of the light engineering industry, including bicycle and sewing machines firms. Nearly 550 units wire-drawing units are located primarily in Pathankot, Jalandhar, Amritsar and Ludhiana.
As per the new policy of the steel ministry, small-scale industrial units can lift their raw material from the PSIEC only, while large units, which lift more than 600 tonnes a year, can take the material directly from RINL. This is costlier, say SSI unit owners.They say the PSIEC charges Rs 175 per metric tonne more than what is being charged by RINL. Due to this problem, small industrialists did not buy any material from the PSIEC last month, resulting in losses to the corporation.
The industry is further troubled by RINL, which, they said, had reduced its allocation by 50 per cent to the industry in Punjab.
Industrialists also say the central excise duty and central sales tax in Himachal Pradesh are only 1 per cent and the raw material being provided by the HP industrial body is almost Rs 400 per metric tonne cheaper in comparison to the PSIEC.
Industrialists, who have also now written to the Ministry of Steel, say they would shift base in the case the government failed to do anything
RVNL to submit paper on
Rail Vikash Nigam Limited will submit a concept paper on the requirement of railway infrastructure in the state for the upcoming steel plant projects to the Railway Ministry by end of this month.
This was indicated by the RVNL officials at a meeting, chaired by Commerce & Transport Secretary, Mrs Rajlaxmi today to discuss with the entrepreneurs about the additional infrastructure requirements for the proposed steel plants and aluminium projects.
It may be noted that 36 private companies have signed MoU with the state government for establishment of steel plants and another four for setting up of aluminium/alumina plants.
The annual production from steel plants by 2016 has been projected at 56 million ton while the raw material requirements by that time will be 175 million ton.
Hence, huge railway and road network will be required for the movement of finished products as well as raw materials.
Official sources said the progress of proposed steel plants, their ore requirements and probable date of commissioning was discussed at todays meeting. The projected additional volume of traffic projected by the state government was more or less confirmed by the entrepreneurs who attended the meeting.
On the basis of inputs provided by the entrepreneurs, the Rail Vikash Nigam Limited will prepare a concept paper on the additional railway infrastructure requirements and will submit it to the Railway Ministry by the end of this month, said the officials.
Industry mantra for growth
The manufacturing sector needs to grow if the Indian economy is to attain the desired double digit growth rate, observed captains of industries while participating at the Ashwamedh conference held at the Xavier Institute of Management here recently.
Mr HM Nerurkar, VP, Tata Steel, stressed on innovation of production techniques combined with efforts at cost reduction. He referred to concepts such as the assembly line production introduced by Mr Henry Ford to modern concepts of total productive maintenance (TPM) to suggest the innovations which have taken place in this sphere. Tata Steel had trebled its output even after reducing the workforce by half, he stated.
Coal India to up production 20 mn tonnes
Coal India Ltd will increase its annual production by 20 million tonne to meet Rs 7,300-crore burden on account of wage revision. The company has ruled out any increase in coal prices to meet the additional burden.
Speaking to Business Standard at the signing of the wage settlement agreement, CIL chairman and managing director Shashi Kumar said 1 million tonne of coal on an average fetches Rs 60 crore for CIL.
An additional 20 mt production will bring to the company Rs 1,200 crore which will help the company to nearly meet the five-year burden of Rs 7,500 crore. CIL had recorded highest ever production of 323.64 mt during 2004-05.
The settlement, valid from July 1, 2001 to June 2006, was signed between the coal representatives of the coal unions and the CIL management on Friday and would be applicable for six lakh coal workers would benefit from the settlement.
Besides CIL, Singareni Colleries Company Ltd would bear a burden of Rs 1,460 crore taking the total impact to Rs 8,760 crore on account an over 60 per cent rise in the basic pay
EU, Kazakhstan sign trade agreement on steel products
The European Union and Kazakhstan signed in Brussels Tuesday a bilateral agreement on trade in certain steel products during the EU-Kazakhstan Co-operation Council meeting. The EU is Kazakhstan's second trading partner, after Russia.
Kazakhstan was led by Deputy Prime Minister Akhmetzhan Smagulovich Yessimov and the EU by UK Minister of State for Europe Douglas Alexander whose country holds the current EU Presidency.
The meeting was part of a regular dialogue under the Partnership and Cooperation Agreement (PCA) which has been the legal framework for EU-Kazakhstan bilateral relations since 1999.
Chinese steel boom fast becoming a memory
Less than a year ago, the world's steel producers were scrambling to feed China's voracious demand for a metal that formed the backbone of its rapidly expanding economy.
Today, the excess of the good days is catching up: The world is facing a surfeit of steel as demand from Asia's most populous nation and in slowing economies elsewhere in the world cools off, triggering an extended decline in prices, fears of a long-term glut and the possibility that China will move further toward becoming a net exporter of steel in coming years.
China's soaring demand for steel has shaped the world market in recent years, causing prices to more than double to a peak of $700 a metric ton in August 2004 from $300 in January 2003.
But huge increases in steel output, especially from Chinese producers, combined with sagging growth in global demand has sent prices plunging about 40 percent from their highs.
Major international steel makers are cutting production to prop up prices, and China, by far the world's biggest producer, is expected to announce a plan Wednesday to consolidate its vast but fragmented steel industry in a bid to curb output.
Efforts by the government to cool the superheated real estate and construction industries have already begun to curb demand in China, the world's biggest steel market, where construction accounts for 67 percent of steel consumption, according to calculations by Baosteel, China's biggest producer.
Slowing growth in many of the world's industrial economies has compounded the problem. Yet China is not slowing steel production in tandem, leading to a buildup of excess steel stocks.
The Chinese government forecasts a domestic steel surplus of more than 40 million metric tons for 2005. China's steel output will increase by 44 million metric tons this year to 316 million metric tons before increasing further to 348 million metric tons in 2006
Evraz Units Boost Profit
Steelmaker Evraz Group said profit soared in 2004 at its three Siberian steel mills, which account for about one-fifth of the country's steel output.
Net income at Nizhny Tagil Iron & Steel rose to $391.4 million under international financial reporting standards, from $80.7 million in 2003, Evraz said Tuesday.
Zapadno-Sibirsky Metallurgichesky Kombinat's profit rose to $382 million from $100.7 million, and Novokuznetsk Iron & Steel's profit totaled $208.5 million
Russian Investors to Participate in Privatization
During the meeting of Turkish Prime Minister Recep Tayyip Erdogan and Russian President Vladimir Putin in Sochi Monday, Putin asked Erdogan for political support.
Russian companies intend to participate in the privatization process in the iron and steel industry.
Nippon Steel curbs Q2 output to combat price fall
Nippon Steel Corp. expects to cut its crude steel output for July-September by at least 300,000 tonnes from its original plan to counter falling prices, the president of Japan's biggest steel maker said on Tuesday.
President Akio Mimura said the company would cut production mainly for exports and aim to reduce excess inventory, a reason for the price fall, at a time when steel makers worldwide are slowing output.
Nippon Steel, the world's third-biggest steel maker, declined to disclose its planned output for the quarter. It produced 7.57 million tonnes of crude steel in July-September last year.
"We have been saying we would not cut prices and that reduced orders," Mimura, who is also chairman of the Japan Iron and Steel Federation, told a news conference. "We are planning to cope with that by cutting output."
He predicted that the fall in steel output would be temporary because long-term demand from China and Southeast Asian countries remains high. Nippon Steel also said it has not yet decided if its full-year production will be reduced.
Yushchenko targets Donetsk "CLANS"
I am the president of all Ukrainians, those who voted for me and those who didn't, those who understand me and those who don't," President Viktor Yushchenko said upon his July 15 arrival in the eastern city of Donetsk, which remains largely hostile towards him.
Donetsk Region voted overwhelmingly in favor of former prime minister Viktor Yanukovych in last year's presidential polls, while support for Yushchenko was limited to single digits.
Last Friday marked Yushchenko's second trip to Donetsk since his inauguration. This visit was not only an attempt to win the hearts and minds of the locals, who believe Yushchenko is too nationalist and too pro-American to be the leader of the Ukrainian nation, but probably also the last warning to the local elites, who, Yushchenko believes, resist democratic changes.
Steel tycoon Renat Akhmetov, who is believed to be the real boss of Donetsk Region, may have no such second chance, as reports have appeared that police suspect him of criminal activity. On June 23 the Interior Ministry's anti-organized crime department head Serhy Kornych said at a news conference, "Akhmetov is a real boss of an organized criminal group." On July 13 the Interior Ministry's criminal investigation department summoned Akhmetov for questioning on July 18. Akhmetov ignored the summons, and his aides replied to the ministry that he is vacationing abroad.
Mittal Steel USA Negotiators still optimistic for steel deal
United Steelworkers of America and Mittal Steel USA negotiators remain hopeful of reaching a new labor agreement, even though negotiations broke off last week without a settlement. The two sides had been bargaining since July 6 in Pittsburgh.
"We're really close, I think," said Marty Henry, president of USWA Local 6115 at Mittal Steel USA Minorca Mine near Virginia. "It was very civil. People were doing a lot of work, and things were moving along quite well, but there were just some issues that couldn't be resolved at the time."
Despite no new talks being scheduled, Mittal Steel USA officials say they remain optimistic about a settlement. "The company has made a fair and comprehensive final offer to the United Steelworkers that follows the former ISG contract pattern, including workforce productivity while preserving the current benefit plan design," said Dave Allen, a Mittal Steel USA spokesman. "We are optimistic that we will reach agreement shortly with the United Steelworkers."
Lone Star 2Q profit increases
Lone Star Technologies Inc.'s profit for second quarter 2005 was up, fueled by higher prices for some of its products.
The company posted second-quarter 2005 net income of $63.5 million, or $2.09 a share, compared to net income of $38.9 million, or $1.30 a share, in 2004's second quarter. The Dallas-based company's revenue rose 9 percent to $325.7 million from $246.2 million in the previous year's period. Net income for the second quarter of 2005 included $7.8 million, or 23 cents a share, related to the early termination of a contract with Tubos del Caribe S.A.
Dallas-based Lone Star Technologies subsidiaries make and market casing, tubing, line pipe and couplings for the oil and gas industry, specialty tubing for the industrial, automotive and power generation industries and flat rolled steel and other tubular products and services
Korean Steel exports increase 8% in first half
Domestic steelmakers' export volume in the six months to June rose 8 percent to 8.14 million metric tons from a year ago, according to the Korea Iron & Steel Association.
Export volumes of deformed bars, section bars, thick plates used for shipbuilding and galvanized iron climbed 258 percent, 88 percent, 63 percent and 22 percent, respectively. Electrolytic galvanizing iron and hot-rolled plates dropped 15 percent and 2.3 percent, respectively, year-on-year.
Domestic steelmakers' sales volumes in China, the largest export destination, plummeted 10 percent to 2.42 million tons in the first half of this year compared to 2004, as China's production is constantly growing.
Exports to Japan, the European Union and the United States, however, rose 27 percent, 23 percent and 16 percent, respectively.
Imports in the six months to June increased 16 percent to 14.2 million tons including 4.12 million tons from China up by almost 160 percent, up from 1.6 million tons last year.
Products that do not require high technology such as deformed bars, sections, wire rods and pipes make up most of the imports from China, according to the Korea Metal Journal.
These relatively less expensive steel products from China are mostly used in the construction sector while high-end products used for shipbuilding are supplied by Korean and Japanese steelmakers.
The industry association expects domestic steel consumption to reach 24 million tons in the next six months while exports should also rise to 8.36 million tons. Imports may drop 3.5 percent to 8.46 million tons, according to the association
PSC Metals acquires scrap metal dealer
PSC Metals Inc. has acquired a Kentucky scrap metal company to better serve its customers in the southeastern United States, according to a statement from Mayfield Heights-based PSC. Terms of the purchase of Causey Enterprises LLC of Bowling Green, Ky., were not disclosed.
PSC buys, sells and processes metals. Its customers primarily are steel producers and scrap metal generators
Japanese Steelmakers to cut output for Asia
Three major Japanese steelmakers will cut back on production of steel products for exports in the hope of applying the brakes to falling prices in the Asian market, which is flooded with inexpensive Chinese products, company officials said Tuesday.
JFE Steel Corp will reduce production to realize a year-on-year cut of 500,000 tons in sales of hot coils in markets such as South Korea and Thailand in the July-September quarter. The planned output reduction is the largest in four years, a JFE official said
Bluescope shares slip after downgrade
Shares in BlueScope Steel slipped as financial analysts at UBS downgraded the stock because of falling steel prices.
UBS analysts Matthew Reynolds and Chris Drew downgraded stock in Australia's biggest steel producer from "neutral" to "reduce" after the investment house cut its forecast for steel prices in the coming year.
Forecasts of hot rolled coil (HRC) steel prices have been revised down for the rest of 2005 and 2006 because of excess Chinese production pressuring global markets.
As a result UBS lowered its forecast for BlueScope's 2005 financial year net profit by three per cent to $1.13 billion, from $1.10 billion.It also cut back its forecast for BlueScope's 2006 financial year net profit by 14 per cent to $612 million, from $715 million.
By the close of trade Bluescope shares had fallen 15 cents or 1.69 per cent to $8.70
Inco Limited announces two new members of its Board
Inco Limited announced today that Rick Waugh and Francis Mer have been appointed Directors of Inco Limited.
Mr. Waugh is currently President and Chief Executive Officer of Scotiabank, one of North America's leading financial institutions
Mr. Mer is the former Minister of Economy, Finance and Industry for the government of France, a position that he held from 2002 to 2004. From 1986 until 2002, Mr. Mer was Chairman and CEO of USINOR, a leading European steel company, and also served as Co-Chairman of the Arcelor Group during this period. Prior to that, he was Chairman and Managing Director of Pont-a-Mousson S.A., a major producer of cast-iron pipe and related products, and Deputy General Manager of the Saint-Gobain Group, responsible for its Pipelines and Mechanical Engineering Division.
Mr. Mer has been Chairman of the Federation Francaise de l'Acier (French Steel Federation), Chairman of Eurofer (European Steel Manufacturers Association), Chairman of the Association Nationale de la Recherche Technique (National Association for Technical Research), and Chairman of the International Iron and Steel Institute. He also currently serves as a director of Adecco S.A., Alstom S.A. and Rhodia S.A. Mr.
Schnitzer Steel elects Jill Schnitzer Edelson as a director
Schnitzer Steel Industries Inc. said Tuesday that its board has elected Jill Schnitzer Edelson to fill a vacant seat on the board .
As part of this planned transition, the board accepted the resignations from the board of three Schnitzer family members.
Dori Schnitzer, Carol Lewis and Gary Schnitzer, who will continue as an executive vice president of Schnitzer Steel Industries are the three directors who have resigned.
EBRD to grant US$75 mln to Alcoa Inc
The European Bank for Reconstruction and Development will arrange a five-year term loan facility of up to US$75 million to Alcoa Inc. to modernize Russian enterprises JSC Belokalitevenskoe Iron & Steel Production Works and JSC Samara Iron & Steel Works .
Alcoa is the world's leading producer of primary aluminum, fabricated aluminum, and alumina and is active in all major aspects of the industry.
Alcoa serves the aerospace, automotive, packaging, building and construction, commercial transportation, and industrial markets, bringing design, engineering, production, and other capabilities of Alcoa's businesses as a single solution to customers.
In addition to aluminum products and components, Alcoa also makes and markets consumer brands including Reynolds Wrap, Alcoa wheels, and Baco household wraps. Among its other businesses are vinyl siding, closures, fastening systems, precision castings, and electrical distribution systems for cars and trucks.
Steel Dynamics Announces Net Income of $51 Million for Second Quarter
Steel Dynamics, Inc. today announced second quarter 2005 earnings of $51 million, or $1.00 per diluted share, versus $67 million or $1.20 per diluted share in the second quarter of 2004 and $61 million, or $1.12 per diluted share, in this year's first quarter. Net sales for the second quarter were $546 million, an increase of 4 percent from the second quarter of 2004, but 4 percent lower than the first quarter of 2005.
"Demand for flat-rolled steel in the second quarter was much weaker than initially expected, particularly toward the end of the quarter," said Keith Busse, President and CEO of Steel Dynamics. "This resulted in lower selling prices and a decrease in the spread between selling prices and the cost of the ferrous scrap consumed during the quarter. Our average consolidated selling price per ton shipped decreased $61 per ton, from $669 in the first quarter to $608 in the second quarter, while our metallics costs were down $49 per ton. Although falling scrap prices in the second quarter are a positive for future quarters, our raw materials costs in the second quarter reflected the somewhat higher prices of materials purchased earlier.
Cline & ThyssenKrupp Close Deal Coal Marketing-Financing
Cline Mining Corporation and ThyssenKrupp MinEnergy GmbH of Essen, Germany have entered into an Agreement for the exclusive, long term purchase, marketing and sale by ThyssenKrupp of coal produced by Cline coal mines for use in the exclusive ThyssenKrupp Territory.
The ThyssenKrupp Territory comprises European Union countries, Ukraine, Turkey, Pakistan, Central (Latin) and South America and ThyssenKrupp steel and coking plants wherever located excepting Japan, Korea and Taiwan. Fifty percent of the Cline coal mines production is slated for delivery into the Territory under the Agreement.
Cline Mining Corporation is a mine development company focused on the exploration and development of metallurgical coal in Canada for the international seaborne coal trade market.
SUEK increased coal shipments by 2.6% for H1
JSC SUEK increased the coal shipments by 2.6 percent for the first half of 2005 as against the same period a year ago up to 38.5 million rubles from 37.5 million rubles. For the first half of 2005, SUEK delivered about 30 million tones of coal to the Russian consumers, down 5 percent from an accounting period last year. Export shipments of the Company raised 13 percent to total 8.5 million tones.
Siberian Coal Energy Company is the major coal group in Russia. The company supplies nearly 80% of coal to the domestic market and around 20% of export. SUEK is the only coal company in Russia which has entered the top ten global coal producers.
Siberian Coal Energy Company (SUEK) has its affiliates and subsidiaries in Krasnoyarsk, Khabarovsk and Primorsky Territories, Irkutsk, Chita and Kemerovo regions, Buryatia and Khakassia, with the total number of employees exceeding 45 thousand.
SUEK also holds large stakes of a number of regional power producers. During the reform of the Russian power industry SUEK plans to gain control over power generation assets in various regions of the country and ensure their efficient cooperation with the company's coal operations.
Straits boosts coal production
Diversified miner Straits Resources Ltd has boosted coal production and sales for the June quarter, as well as producing the first copper from its Whim Creek project.
Straits said coal production from its Sebuku mine in Indonesia had been 697,000 tonnes for the quarter, up on the 626,000 tonnes produced in the March quarter.
Coal production for the half year to June 2005 was 1.349 million tonnes compared to 1.237 million tonnes for the same period in 2004.
The company said the outlook for the Sebuku operation looked positive for the rest of 2005 and 2006, with much of the output already committed under current prices.
Steel profits still sinking, with demand still shrinking
The largest U.S. steelmakers including U.S. Steel Corp., Nucor Corp. and AK Steel Holding Corp. likely will report that profits in the last three months declined from the first quarter, after falling demand prompted the industry to reduce prices and production.
Profit at 13 companies in the Standard & Poor's Steel Index fell 7.7 percent on average from the first quarter, according to estimates compiled by Thomson Financial. Per-share profit at U.S. Steel, the nation's largest producer, likely fell from net income of $455 million, or $3.48 a share, to $2.19 a share, the average of 15 estimates.
The price of steel sheet used in cars and appliances has plunged for nine straight months, dropping 35 percent from a record in September. Pittsburgh-based U.S. Steel in May shut a blast furnace earlier than planned, contributing to a slide in production since April.
The 13 companies in the Standard & Poor's steel index will earn 11 percent less than in the second quarter and 14 percent less than in the third quarter last year. The index has fallen 25 percent from this year's peak on March 4.
"We haven't seen any data to make us believe that steel prices are going to stabilize or bottom out just yet," said Hicks of U.S. Global Advisors.
Consolidated finds more Kambalda nickel
Consolidated Minerals has increased the nickel resources at its Reliance operations near Kambalda in Western Australia by more than a third.
Consolidated Minerals took over junior nickel producer Reliance Mining earlier this year and has been actively exploring at the Reliance operations since the deal was completed.
The new resource estimate stands at 2.1 million tonnes grading 3.6 per cent nickel for 74,000 tonnes of contained nickel. The estimates comes from updated figures for the Beta Hunt and East Alpha projects and new estimates for the Foster and East Cooee deposits, close to the Beta Hunt mine.
Steelco Workers buy time in court
An Ontario judge has given the United Steelworkers of America union three more weeks to marshal arguments as to why it should be allowed to launch a restructuring plan for Stelco Inc., and also granted the technically insolvent company an extension of its bankruptcy protection until Sept. 9.
The ruling by Mr. Justice James Farley, which gave Stelco the length of extension it had been seeking, came after a sometimes testy Ontario Superior Court hearing in Toronto yesterday during which:
SSAB Q2 profits rise on strong demand for niche products
Svenskt Staal AB said its second quarter profit after financial items rose to 1.748 bln skr from 921 mln a year earlier, boosted by strong demand for its core niche products and improved margins in the steel operations.
The company said that for the remainder of the year, underlying steel consumption in Western Europe is expected to remain at approximately the same level as during the first half of the year. However, growth in the group's core niche products, extra and ultra high-strength sheet and quenched steels, is expected to remain strong.
MMK managers to buy back 34% in company
Manager of the Magnitogorsk Metal Works will buy back 34 percent in the company from UFGIS Trading Ltd within five years, MMK chairman Viktor Rashnikov has told journalists. He declined to elaborate whether interim dividends are supposed to be paid for the first half of this year, or not. MMK board of directors has made a corresponding decision at a meeting today.
In December 2004, the Mechel group agreed with UFGIS Trading Ltd. on the sale of 16.59 percent in MMK for USD870m. UFGIS has also won an auction for selling the state stake in MMK (17.89 percent) having paid USD790m for it.
