September, 01 2005
Posco India is born
South Korean steel company POSCO has started an Indian subsidiary, Posco India, in Bhubaneswar, Orissa. POSCO India has been registered under the Companies Act, 1956 with the Registrar of Companies, Orissa.
Mr Soung-Sik Cho, Senior Executive VP of POSCO, has been given the additional charge of MD of POSCO India of the subsidiary. Mr Tae-hyun Jeong has been appointed as the Deputy MD. While Mr Cho will be based in Korea, Mr Jeong will be based in Orissa.
Uttam Galva Steels to increase prices on September 1st
Uttam Galva Steels, one of the leading exporters of galvanized steel in India has announced that it will increase its prices across all product categories with effect from September 1, 2005 ranging between Rs 2000 to Rs 3000 per ton across galvanized steel, cold rolled steel and also steel by-products.
Mr Ankit Miglani, Director, Uttam Galva Steels Ltd, said The metal markets are firming across the globe and the under currents witnessed last quarter are now coming true. The demand for our products is increasing and we are in a position to increase the prices of our galvanized and cold rolled steel.
Uttam Galva Steels is focused on flat products specializing in value added grades and niche segments which have a high demand in the overseas market and growing requirements domestically. The company plans to raise its production and finishing capacity in the coming financial year to meet growing global demand for galvanized and cold rolled steel. Uttam Galva Steels intends to produce one million tons of cold rolled steel and 750,000 tons of galvanized steel by the end of 2006.
Tata Steel & SAIL eye BCCL coal block
SAIL and Tata Steel are competing for a joint venture with Bharat Coking Coal Limited BCCL to take up mining in Kapuria coking coal block at Sijua in Dhanbad district. BCCL, which is in the red, is a subsidiary of state-owned Coal India Limited CIL and most of its mines are located in Jharkhand.
Both SAIL and Tata Steel have submitted written proposals to BCCL, expressing interest in a joint venture with it for mining in Kapuria block, informed BCCL sources.
It is believed that the steel behemoths dependence on imported coking coal would get reduced to a large extent with the joint venture. SAIL and Tata Steel import a grade of coking coal to produce steel.
The coking coal reserve at Kapuria block, as claimed by BCCL, is estimated to be over 150 million tonne.
Tata Ryerson plans major expansion
Tata Ryerson Ltd TRL, a 50:50 JV of Tata Steel and US based Ryerson Tull has announced major expansion plans that would entail an investment of Rs 200 crore by 2010. "The company will double its present capacity from 1.2 million tonne to two million tonne per annum by 2010 which would attract a total investment of about Rs 200 crore," TRL MD Mr Sandipan Chakravorrty said.
The company would invest Rs 80 crore over the next two years to complete a new unit at Faridabad and another proposed in South India. The commissioning of the Faridabad Cold Roll and Faber processing facility would take place by this January-February next year or a total investment of Rs 40 crore. TRL is also contemplating to foray into South India by setting up a steel plate processing plant either at Chennai or Bangalore.
TRL, which till date has its steel processing operations confined only within the country at Pune and Jamshedpur, is also eyeing burgeoning economies like China and Thailand, where demand for steel and its production both are growing at fantastic pace, for expansion. Ryerson Tull is keen on setting up shops in countries like China to get a slice of the growing steel market there and other South East Asian countries. But Tata Steel is more interested in exploiting the opportunities at home as Indian steel production is set to double in the next five years.
Voestalpines switch technology establishes 2nd JV in India
VAE GmbH, a company of Division Railway Systems of the listed voestalpine AG and global market leader in switches and turnout systems, has just established another joint venture in India. In this case VAE has acquired a majority share of 51% in the Indian switch manufacturer, Rahee Track Technologies Pvt. Ltd.
The new company has production sites in Calcutta and Hyderabad employing over 150 people. As a result, the VAE Group will now be in a position to further improve its market access with demand-oriented production in the Southeast of the subcontinent. Prior to this, VAE had established a presence in India with plants in Delhi and Batala in Northern India.
Rahee Track Technologies manufactures switches, switch components, rail expansion joints and switch point locks. The company supplies the state-owned Indian Railways and exports to other Asian countries as well as to Africa.
Having established the new joint venture, the VAE Group now possesses 32 production sites in 15 countries throughout the world. In the 2004/05 financial year it posted sales revenues of EUR 494 million with a total of 3,540 employees
Steel products fail to figure in SAFTA indicative list
The ministry of steel, in consultation with Ministry of Commerce, has rejected domestic steel producers demand to include certain products in the sensitive list of items to be traded under South Asian Free Trade Area SAFTA, as they found no merit in the demand as they felt the industry would only gain from zero duty trade of steel products within SAARC countries under SAFTA
Domestic steel producers had demanded that certain steel products like galvanised sheets, wire rods and a host of hot rolled products be put in the sensitive list under SAFTA in tandem with proposals of other neighboring countries.
SAFTA is to be implemented from January 1, 2006 with complete implementation by 2016. Under it, duty on all tradable items would gradually move to 0% level in a phased manner. However, each country will also have a sensitive list of items where concessional market access will not be permitted.
This is second setback for the domestic steel industry. The steel ministry had earlier rejected their plea to raise import duty on steel to protect the industry from surge in imports.
TATA Ryerson to supply Rebars & rings to builders
Real estate promoters and even persons getting their own houses built will soon be able to buy their entire requirement of steel rods and rings precision cut or bent to their requirements and delivered to their doorstep. While this will eliminate the time wasted by labour at construction sites in building the cages that form the basis of concrete pillars and roofs, it will also save a lot on labour costs and ensure quality.
Tata Ryerson Ltd, a 50:50 venture between Tata Steel and Ryerson Tull of the US, has set up a rebar facility in Faridabad to feed the housing boom in the national capital region. Mr Sandipan Chakrabortty, Tata Ryersons MD, said that the countrys first fully-automated rebar processing facility can bend and twist torsion steel bars or ribbed bars into lengths and shapes sought by builders.
Severstal & Evraz plan joint bid for Krivorozhstal
Severstal, the third-ranked Russian steelmaker controlled by Mr Alexei Mordashov, and the Evraz Group, the biggest producer led by Mr Alexander Abramov, have now signaled industry sources in Moscow that they will form a consortium to bid together for the Ukrainian property.
Severstal had bid $1 billion for Krivorozhstal in June 2004 in partnership with Arcelor and the bid amount was subsequently restated to $1.2 billion, but Arcelor withdrew before the tender award was announced, and IMU won the property at $800 million. Evraz's Mr Abramov also claimed at the time that his group had entered a bid of $1.12 billion through Nizhny Tagil Metal Combine NTMK. The other bid at the time was $1.5 billion from the Mittal group's LNM and US Steel, bidding together.
According to Evraz last year, "based on the tender committee's protocols, it is clear that NTMK met all the qualifying conditions in its tender proposal with the sole exception of the provision that the company produce one million tons of coke on the territory of Ukraine.
Now the Ukrainian Government has fixed a minimum price at $2 billion with an additional 7-year $2.4 billion capital expenditure program as a qualifying condition, plus revenue targets and employment commitments.
The Ukrainian government has announced that four candidates have now registered to participate in the pending privatization tender for Krivorozhstal. According to the Ukrainian government, the four as yet unidentified candidates have received the tender documentation, and will now open due diligence on the company.
The government has said it will decide the new owner on October 24, but the current owners, the Industrial and Metallurgical Union (IMU), are challenging a new award as illegal, and court action may delay the process. IMU is owned by Mr Rinat Akhmetov and Mr Victor Pinchuk, who were closely connected to the former Ukrainian regime of President Mr Leonid Kuchma.
Last year, Krivorozhstal produced 7.1 million tons of crude steel and 6.2 million tons of steel products. The plant also controls iron-ore and coking coal sources that provide between 80% and 90% of its input requirements. The company posted revenues of $1.9 billion in 2004, with net profit at $378 million, the highest profit margin among the Ukrainian steel enterprises.
S Korea's Dongkuk Steel cuts SBQ plate price
Dongkuk Steel Mill Co. has decided to trim its prices for steel plates used in shipbuilding due to a stable decrease in raw material prices, the steelmaker said Wednesday. Dongkuk will decrease the price by 30,000 won to 685,000 won (US$632) per ton beginning Monday.
The other domestic suppliers POSCO has not announced any reduction but Japanese steelmakers, including Nippon Steel Corp., have said it would freeze the export price of steel plates at US$680 per ton over the next six months starting in October
Metso to expand recycling business with a US acquisition
Metso Minerals has acquired Texas Shredder, Inc., a supplier of metal shredder products located in San Antonio, Texas from a group of private investors led by Capital Southwest Corporation, a venture capital investment company for approximately EUR 13 million. The acquired company will be merged with Metso Minerals' current metal recycling operations in the USA to form a new company, Metso Texas Shredder, Inc.
Texas Shredder is the leading supplier of metal shredder plants and related aftermarket services in North America. The unaudited net sales of the company for the fiscal year, ending June 30, 2005, were EUR 46 million. It employs 33 people.
With the acquisition, Metso Minerals strengthens considerably its position in the North American metal recycling market, which is the largest in the world, processing approximately 70 million tons of metal scrap annually. Texas Shredder also complements Metso's downstream technology solutions and aftermarket capabilities. Texas Shredder's large installed base comprises over 60 shredder plants.
Metso's recycling business has developed favorably since it became a part of Metso Minerals in the Svedala acquisition in 2001: The net sales have nearly doubled in two years, reaching approximately EUR 130 million in 2004. Following the acquisition of Texas Shredder, the net sales are expected to reach EUR 200 million. The positive development is largely due to the global increase in steel demand.
Domestic oversupply drags down Chinese thermal coal prices
Domestic coal prices have retreated slightly on the back of a moderate oversupply in the fragmented sector and analysts predict the downtrend will continue through 2007. Prices from major producers in resource-rich areas such as Shanxi, Shandong and Anhui provinces have slid some 30 yuan (US$3.7) to 50 yuan (US$6.2) per ton on average since July, according to industry sources.
Prices at the coal exchange centre in Qinhuangdao of North China's Hebei Province, one of the country's major ports for coal transportation, have fallen some 7 per cent over the past two months, a drop from 440 yuan (US$54) per ton to the current 410 yuan (US$50) per ton, Li Xuegang, president of the coal exchange centre told China Daily yesterday.
"The situation reflects a moderate surplus of coal supply, which was tight in previous years because of soaring demand for energy," Zhu Deren, vice-president of the China Coal Industry Association (CCIA) told China Daily.
Guo Yuntao, director of the China Coal Industry Development Research Centre told a July coal conference in Beijing that the country is expected to produce 200 million tons more than last year, while demand will rise by some 150 million tons. China last year produced 1.96 billion tons of coal, and used 1.89 billion tons, with exports and imports reaching 87 million and 19 million tons respectively.
Ankara Chamber of Commerce joins EOGC for Erdemir
The Ankara Chamber of Commerce (ATO) has decided to join a local group that will bid in the upcoming privatization of steelmaker Erdemir. ATO will contribute $5 million to the Eregli joint venture EOGC, comprising a group of investors backed by the powerful Turkish Union of Chambers and Commodities Exchanges TOBB.
ATO Chairman Mr Sinan Aygun said the chamber is one of the founding partners of Erdemir, would support as best it can efforts to keep the majority share of the steelmaker in local hands. Mr Aygun called on Turkey's top 500 industrial companies to join the Ereπli joint venture and give at least $1 million each for the sake of the national capital movement. "This is a national resistance," he said.
The Privatization Administration (OIB) plans to sell off the government's 46 percent stake in Erdemir next month, with final bids due on Sept. 24. Erdemir ranks number nine in Europe and number 11 worldwide. The firm's 7,500 workers last year produced more than 3.5 million tons of steel.
Erdemir earned $473 million last year on gross revenues of $3 billion. The firm has a market capitalization of $2.5 billion, though any buyer of the state's shares is expected to pay a premium to gain control of the company.
Bangladesh steel mills urge government to stop TATA Steel
Domestic Steel re rolling mill operators here have urged the Bangladesh government not to allow the Tata Group to produce finished steel products like rod and iron bar in their proposed steel plant. A joint delegation of Bangladesh Re-rolling Mills Association (BRMA) and Bangladesh Steel Mills owners association (BSMOA) placed this demand to the Industries Minister Mr Matiur Rahman Nizami
They, however, said they would welcome the investment of Tata Group in the steel sector if it produces raw materials like sponge iron for the local mills.
But if Tata is allowed to produce finished rod and iron products, which is sued in construction sector, it would be damaging for the local steel mills.
The steel producers also demanded the supply of natural gas to their plants at a lower rate than that would be proposed to the Tata Group.
EC decides anti dumping duty on Vietnamese SS fasteners
The European Commission (EC) has decided to uphold the placement of a 7.7% anti-dumping tax on imports of stainless steel fasteners and accessories from Vietnam, similar to the provisional anti-dumping duty the EC had imposed on the products of five fastener makers in Vietnam since late May
Before being subject to the anti-dumping tax, Vietnamese stainless steel fasteners and parts enjoyed tax rates of 3.7 percent.
Tarpon Industries to acquire Midwest Tube Mills
Tarpon Industries, Inc., a manufacturer and distributor of structural and mechanical steel tubing and engineered steel storage rack systems, today announced that it has signed a definitive agreement to purchase substantially all of the assets of Midwest Tube Mills, Inc. for approximately $27.5 million. Tarpon is in the process of securing financing for the acquisition, which is expected to close in the fourth quarter of 2005.
"The acquisition of Midwest would be a significant milestone in Tarpons growth strategy, said Tarpon Chairman and CEO J. Peter Farquhar. Their product line will be complementary to our Steelbank Tubular mechanical tubing platform and will provide us with further customer diversification on both a geographic and end-user market basis. As a result of the acquisition, we would expect to see improved purchasing efficiencies, reduced freight expense and increased revenues due to additional sales into our complementary market segments.
Headquartered in Madison, Indiana, Midwest Tube Mills, Inc. manufactures and distributes mechanical steel tubing for global consumption for industrial, commercial and residential sectors. The companys end user applications include chain link fencing, agricultural fencing, pet kennels, security partitions, sports facilities and parks, house wares, and furniture.
Tarpon Industries, Inc., through its wholly owned subsidiaries within the United States and Canada, manufactures and sells structural and mechanical steel tubing and engineered steel storage rack systems. Through an aggressive acquisition-driven business model, the companys mission is to become a larger and more significant manufacturer and distributor of structural and mechanical steel tubing, engineered steel storage rack systems and related products.
Pipe Iron & Steel Works TMK eyes MEA
JSC Pipe Iron & Steel Works TMK intends to open representative offices in the United Arab Emirates and Syria, to raise deliveries in Arabian countries. At present, the volume of supplies to these countries makes up 30 percent of export, approximately 150,000 tones.
Chairman of the Board of Directors of the Company Dmitry Pumpyansky said that about 40 percent of export products are delivered to the countries of the European Economic Cooperation. The difficulties can emerge connected with deliveries to theses countries in view of begun antidumping investigation against Russian, Ukrainian and Romanian manufactures of pipe products
US Steel announces changes in commercial organization
US Steel Corporation has announced that Mr J James Kutka has been appointed as Senior VP Commercial, effective September 1 and would be responsible for all North American sales and marketing of flat-rolled products
Mr Kutka began his US Steel career in 1967 as a production worker at the company's former Canton Roll & Machine Work and has held several positions in accounting, purchasing, business planning and sales before he was named GM HR in 1993. He served as GM of Business Process Reengineering and Marketing & planning before becoming GM Automotives in 2001. Thereafter he was appointed to VP Commercial and in 2002, assumed the additional role of President US Steel International, Inc..
Also effective September 1, Mr Joseph R. Scherrbaum will return to Pittsburgh headquarters as VP Sales, reporting to Mr Kutka, with responsibility for domestic sales and customer service for flat-rolled products. Since 2002, Mr Scherrbaum served as VP Commercial at US Steel Kosice. Succeeding Mr Scherrbaum at USSK is Mr John B. Peters, who most recently serving as GM Appliance, tin and container at Pittsburgh headquarters
Macquarie analyst predicts that Zinc demand would outpace supply
Zinc may rebound this year and next as demand for galvanized sheet steel used in cars and washing machines outpaces supply, according to Macquarie Bank Ltd. Zinc will advance to 70 cents a pound, or $1,543 a metric ton, by the end of next year, the highest since 1997 as per Mr Adam Rowley, an analyst at Macquarie Bank in London
Zinc for three-month delivery was at $1,354 yesterday on the London Metal Exchange. A dearth of new mining projects to meet rising global demand for the metal will fuel price gains, according to Rowley.
Rowley's forecast contrasts with that of Goldman Sachs Group Inc. and ABN Amro Holding NV. Goldman's James Gutman predicts zinc will average $1,278 this year and $1,288 in 2006. ABN Amro analyst Nick Moore predicts a decline in zinc prices because steelmakers are cutting production amid weak global demand.
Ukrainian steel magnate defies new rulers
One of Ukraine's richest magnates Mr Viktor Pinchuk, son in law of ex President Leonid Kuchma, said that the Government is trying to seize illegally Nikopolsky ferroalloy plant, which his Pridneprovie group bought in 2003 through an auction, now struck down as unlawful by a court process and accused Prime Minister Ms Yulia Tymoshenko of conducting a witch hunt against him. Mr Pinchuk along with Mr Rinat Akmetov, has also been stripped of control of the giant Kryvorizhstal steel mill by the courts.
The developments come as the government, three days after prevailing in the court, managed to appoint a loyal management at Nikopol, replacing those that had been appointed by Pinchuk.
The Ukrainian entrepreneur, in a fiery speech to workers at the Nikopol Ferroalloy Plant on Tuesday, said he would try to gain back some of the assets by bidding at upcoming auctions. "I told the workers I am not here to defend my property. I am here to ensure that we have democratic principles," Pinchuk said. "If we allow lawlessness at one factory, it could happen anywhere. We won the tender fairly. This is a settling of accounts by the prime minister against me and my family."He said Ms Tymoshenko was "lobbying the interests of a different business group. She should be looking after the economy. This is revenge. This is a witch hunt. This is a corruption scandal."
"I am ready to bid and win," Mr Pinchuk told workers at Nikopol, one of the world's largest ferroalloy companies. This is the first time that Pinchuk has publicly pledged to bid for Nikopol, suggesting the competition will heat up ahead of an auction that may help the government get a decent price.
Mr Pinchuk acquired 25 percent and was later entitled to buy another 25 percent and has about $76 million for the stakes of NFA. Pinchuk's arch business rival, Mr Ihor Kolomoyskiy, a co-owner of Privatbank, the country's largest bank, pledged to bid for a 51% stake in Nikopol. Mr Kolomoyskiy said the stake may be worth between $300 million and $400 million. But Prime Minister Ms Yulia Tymoshenko, encouraged by growing competition, said Tuesday the government may raise between $400 million and $600 million from selling the stake before the end of the year.
Russian pipe maker Chelyabinsk profits down in H1
Chelyabinsk Tube Rolling Plant, having 16% domestic market share has reported a 35 percent drop in its first-half net profit due to high raw materials prices.
The net profit was 137.7 million rubles ($4.8 million), down from 210.6 million rubles over the same period in 2004. Revenues rose slightly to 9 billion rubles ($316 million) from 8.6 billion rubles in the first half of 2004.
Prices for steel, the main raw material used in Chelyabinsk pipes, had risen strongly until the second quarter but have eased in recent months.
Russia's pipe market, dominated by Chelyabinsk's bigger rival, TMK, is booming in tandem with the growing energy sector, which needs more pipelines to expand export capacity.
TI Automotive wins new fluid carrying component business
TI Automotive has been awarded contracts by three major auto manufacturers to supply fluid-carrying lines for five new-model vehicles.
Combined sales for the new contracts from DaimlerChrysler, Ford and Nissan total nearly $100 million. Production at TI Automotive facilities in North America and Europe is scheduled to begin as early as next spring.
Fuel-filler tubes, utilizing 436 SS, for these contracts will be handled by the company's plant in Ashley, Indiana. TI Automotive recently introduced the use of 436 stainless steel as a high performance, cost-effective material for fill-pipe applications.
TI Automotive is the world's leading supplier of fluid storage, transfer and delivery systems including brake, fuel and air conditioning applications. Based in Warren, Mich., the company employs over 20,000 people at more than 130 facilities in 28 countries on six continents.
Pakistans new steel policy to give priority to manufacturing
Mr Jahangir Khan Tareen, the federal minister for industries, production and special initiatives, has said that the government will prioritize different elements while devising a new steel policy. The new policy will give more importance to manufacturing whether imported or indigenous iron ore is used. In the second stage, it will encourage the use of indigenous iron ore.
The minister said that a steel research institute would be established by public private partnership and a skill development program in the steel industry will be initiated with the help of the Higher Education Commission
The minister made a comprehensive overview of how the Kalabagh iron ore extraction plan and construction of steel mill there by the private sector could be made a reality.The minister said that the government would encourage and facilitate the private sector to initiate this project. In this regard, he directed the EDB to render its full support in order to give a practical shape to the project. He also said that the government would also encourage the private sector to install a DRI plant in Karachi
Ship carrying Shougangs iron ore hits rock off Peru coast
A cargo ship, MV Orient Brilliance carrying iron ore to China, hit a submerged rock on Tuesday, causing some damage to the ship. It is carrying 142,000 MT of iron ore for Chinese owned iron miner Shougang Hierro Peru SAA. The accident occurred outside of the port of San Nicolas, situated near San Juan de Marcona on the Pacific coast south of the capital of Lima
The Orient Brilliance is owned by the Orient Steamship group, a privately owned company with offices in Hong Kong and Vancouver.
Shougang Hierro Peru, a unit of China's Shougang Group has owned the Peru's only iron mine since 1993.
UKs Coal Miners to self fund expansion
Coal International has reported that once the plant at its King-Coal project has been refurbished, in about three months time, it will start production at a rate of some 80 000 t per month of premium high volatile coking coal. It is expected that within three years these operations will produce in excess of 2-million tons of clean coal per annum.
Based on mine planning and use of contract miners and engineering studies now being finalised, the capital cost required to achieve these production levels is anticipated to be funded from current cash reserves.
King-Coal owns some 35-million tons of metallurgical and thermal coal reserves contained in two surface and two underground operations capable of producing over 2-million tons per annum of clean coal over a mine life in excess of ten years. The company owns, and is in the process of refurbishing and upgrading, a coal preparation plant with a capacity of processing in excess of 6-million tons per annum allowing for additional coal processing from other sources.
Maple Coal also anticipates it will start production of low-sulphur thermal coal at a rate of about 1-million tons per annum, which will normalise at a rate of about 850 000 t per annum after year two over an estimated mine life of 17 years. Capital required to establish the surface mining operation, again using contract miners, is anticipated to be less than $9-million, intended to be funded from cash reserves. Following receipt of new mining permits for underground operations, estimated to require two years, the company expects to establish underground production at an annual rate of an additional a million tons of high quality, mid-volatile coking coal with an estimated mine life of 8 years.
Subject to transfer of existing permits, which are in process, Maple Coal will own some 87-million tons of low-sulphur, high-quality thermal and mid-volatile coking-coals, which amounts to 48-million clean tons.
