October, 13 2005
SAIL & CIL to bid jointly for developing coking coal mines
Steel Authority of India Ltd and Coal India Ltd are likely to form a joint venture to bid for coking coal mines and develop them to meet long term requirement. "We are telling them to develop coking coal mines and we shall provide all support," SAIL Chairman Mr V S Jain told press during an interview.
SAIL's present requirement of coking coal is 10 million tonnes and is likely to go up to 15 million tonnes by 2012, Mr Jain said, adding most of the demand is met through imports.
SAIL Chairman informed that "We are looking at twin strategy to overcome coking coal shortages. In India we have signed an MoU with CIL and we are also looking at picking equity stake in overseas mines especially in the US and Australia." Mr Jain also revealed that some discussions were on in Russia, and Poland for equity participation in coal mines to have secured supply. However, no final decision has yet been taken.
Competitive bids for coal mining on hold
Based on feedback from the power and steel ministries, the coal ministry has decided to postpone allocation of captive coal mines through the competitive bidding route. The ministry had earlier decided to allot around 28 coal and lignite mining blocks through the inter ministerial screening committee route, headed by the coal secretary with members from other ministries concerned and officials from state governments.
Sources clarified that this decision was not account of any union pressure but because of factors such as the present pricing structure where sectors such as power, one of the largest consumers of coal, are not in a position to follow free market pricing. By allotting the captive coal mines through the competitive bidding route, there was a risk that prices of coal could rise and that would lead to increase in power prices as well.
Sources clarified that the present decision does not mean that the competitive bidding route has been shelved. An amendment to the Act would have taken a long time and instead of waiting for the amendment to be in place, the consultation process would yield results faster, they said. There are a total of 136 blocks out of which 87 coal blocks have already been allotted. Out of the remaining 49 blocks, sources said not all the available blocks are attractive. Therefore, as and when more blocks are open for mining, the competitive bidding route could be adopted.
Mittal Steel looks at furnace options for Jharkhand unit
Mittal Steel is contemplating between the production cost from 6 million tonne BF and relining ease from two 3 million tonne BFs to decide the size of blast furnace for Jharkhand plant. At present, there are just two 6 million tonne blast furnaces, one run Bao Steel and the other by Severstal.
A large blast furnace may well help to keep per unit costs low, while operations, though mega scale. But Mr Aditya Mittal says that it may not make economic sense as BFs have to be relined after a few years. If there is just one, we have to shut down operations altogether
All the integrated steel makers in India have opted for 3 million tonne capacity BF and it is generally accepted that the optimum size for a blast furnace is 3-4m tonnes
Ennore Port's coal terminal faces problem
The Rs 350 crore Ennore Port coal terminal has hit a legal speed breaker. The Madras High Court has ruled that South Indian Corporation Ltd, a consortium leader that was disqualified by Ennore Port in May 2003 from bidding for the 8 million tonnes a year terminal, be allowed to join the bidding process again.
Three months after South India Corporation Agencies Ltd of A C Muthiah Group, Adani Ports and Leighton Contractors, Singapore made bids for building the coal terminal in July 2005, the Court order on September 13 is expected to cause fresh delays in the port privatization process.
It is feared that now the project will be pushed back by almost a year if Ennore Port go in appeal against the Court order, rework the bidding process all over again for inducting SICL into the panel of short listed bidders or go for a fresh bidding.
The grounds on which SICL got disqualified was that it did not meet the minimum cargo handling capacity of 2 million tonnes a year of dry cargo in any of the three preceding years implemented as an equity holder with not less than a 26 per cent stake in an infrastructure project costing not less than Rs 300 crore.
The High Court ruled that it was not necessary that SICL itself met these parameters but it was sufficient that its consortium partner Portia Management Services Ltd, UK did so. While SICL was the leading partner in the consortium with a 36 per cent stake, the UK company and Vizag-based Navyuga Engineering Company Ltd had 32 per cent each.
PSL to raise Rs 50 cr
Large diameter steel pipe manufacturer PSL Ltd has announced that it will raise over Rs 50 crore to finance its expansion plans by offering preferential allotment of shares to Citigroup Global Markets Mauritius Ltd and Macquarie Bank Ltd. Both the companies have confirmed their intentions to subscribe 10 lakh equity shares each, aggregating to over Rs 50 crore, PSL said in a release.
"The accretion would primarily be utilized by the company for capacity expansion of its existing domestic plants and setting up of new international facilities," as per PSL Ltds MD Mr Ashok Punj
Chinas steel exports soar through first 9 months
Chinas Customs General Administration indicated that the countrys finished steel product exports skyrocketed during the first nine months of 2005
Chinas exports of finished steel products jumped 83 percent year on year to 15.8 million tons through September. In the other direction, Chinas imports of finished steel products slipped 16.4 percent year on year to 20 million tons.
In terms of raw materials, China imported 20 million tons of iron ore through the same period, up 31.7 percent. Coal imports increased 44.6% year on year to 18.49 million tons.
China Iron & Steel Association CISA announced that twenty domestic steelmakers each exported at least 100000 tons of steel products during the January-August 2005 period.
Baosteel led the way with exports of 1.51 million tons followed by Anshan Steel with 1.25 million tons. Wuhan Steel was third with 700,000 MT followed by Valin Steel 560,000 MT and Shougang Steel at 540,000 MT
Other steelmakers with 100000 tons or more worth of exports include Shagang Steel at 390,000 MT, Masteel at 360,000 MT, Guangzhou Steel at 300,000 MT, Laiwu Steel at 280,000 MT, Benxi Steel at 260,000 MT, Baotou Steel at 240,000 MT, Jiuquan Steel at 240,000 MT, Jinan Steel at 230,000 MT, Nanjin Steel at 190,000 MT, Xingchen Steel at 180,000 MT, Tianjin Pipe at 170,000 MT, Panzhihua Steel at 130,000 MT, Tangshan Steel at 110,000 MT, Xingtai Steel at 110,000 MT and Shi Jiazhuang Steel at 100,000 MT
Race for Kryvorizhstal Ten contenders likely
Ukrainian PM Mr Yuriy Yekhanurov has informed the local press that ten companies are expected to bid for a 93.02% majority stake in Kryvorizhstal, Ukraine's biggest steel mill on October 24th. The bidders were not identified by the PM.
The companies expected to bid include Mittal Steel, Severstal, US Steel, Evraz, Arcelor-IUD and Interpipe. The full list has not been disclosed as yet.
The starting bid price has been set at $2 billion, well above the $800 million paid last year by a consortium partly owned by Mr Victor Pichuk.
Global steel markets oversupplied in H1 on over production MEPS
Global steel markets continue to be oversupplied, and at the half year point, world steel output was up 7.6% on the same period 2004, UK consultancy MEPS reported. "This factor is largely the result of continued over production in Asia-mainly China. Steel supply has been reduced recently across Europe, North and South America...and is now so acute that South Korean, Japanese and Taiwanese steel makers are also cutting back in an effort to prop up prices," MEPS said.
"We detect no signs that the Chinese steelmakers will bring output more in line with domestic demand in the near term. The actions in Europe and the Americas will almost certainly be offset by higher Chinese supply," said MEPS. A global steel price revival could be expected in the second quarter of 2006 if the Chinese authorities undertake more stringent fiscal measures to stifle output and reduce or eliminate export rebates.
Substantial flat-product capacity is scheduled to come on stream in the short term-adding to an already difficult situation. The oversupply situation across the globe has resulted in the MEPS World average flat product transaction price falling for four consecutive months. Appreciation of the Asian currencies could lead to a small rise in August, although further marginal decreases are likely until March 2005.
MEPS noted that the MEPS world average long products price fell once again in July, the seventh consecutive monthly decrease. "The rate of reduction has been much slower than in the flat products segment because the panic buying was less intense in 2004 in the long products' categories," the consultancy said. "We forecast further price reduction over the next few months to March 2006. Asian excess material is expected to put downward pressure on prices around the world as suppliers try to export their oversupply," MEPS concluded.
US announces remedy proposals on imports of Chinese pipes
The US International Trade Commission ITC has announced remedy proposals in its safeguard investigation into circular welded non-alloy steel pipes, or standard pipes, from China.
ITC said in a statement that the move follows its Oct 3 determination of market disruption in the investigation, and it will forward the proposals to the US president and the US Trade Representative USTR by Oct 21.
The proposals include an annual quota of 160,000 short tons on such imports from China and the imposition of a tariff rate quota for a three year period.
ITC proposed that such imports be subject to a tariff rate quota with increases of five pct in the second year and ten in the third. Imports over these quota levels will be subject to an ad valorem tariff of 25%.
ITC launched a probe to see if safeguard measures were warranted against two kinds of China-made steel pipes in August, after seven US steel-pipe producers and two industrial associations filed a petition claiming that a surge in Chinese imports had disrupted the US market and harmed the industry and more than 50 enterprises in China are involved in the investigation.
The proposed tariff-rate quota is based on 2004 imports from China, which were valued at some $110 million, up 657.5% from a year earlier. China's exports of standard pipes to the US hit $87.5 million in the first half of this year, reflecting a 234.6 % YOY increase.
European mills insist on high flat rolled prices
Major European flat rolled steel producers hiked their sales prices by mid September, after having filled their order books for October production. This was an attempt to push fourth quarter prices upwards despite the slow demand in the European market.
It still looks like the European mills are maintaining their high prices as their order books are full until November. On the other hand, the European buyers still expect a downward correction of the prices. Thus, they are likely to postpone their moves for some time before they make any purchasing decisions. Market players say that it may even take until the end of the month before any of the parties move and change the status quo.
Of course, the European mills have their reasoning behind such an attitude. First of all, the inventory levels are down according to several market players. Second of all, the import offers are limited and priced high compared to previous months. Most important of all, the European mills are not likely to increase output. Instead, they will keep controlling the supply into the market.
Obviously, if consumption picks up during the next couple of weeks, the mills may even start looking for higher prices. Southern European markets like Italy and Spain are particularly encouraging the steel mills, as an improvement in consumption may be seen there.
SS market on a recovery path
Currently, the dropping of the stainless base price has slowed down due to the decreasing stock levels and recovering of the nickel price.
US market is likely to stabilize with increase in alloy surcharges, which had resulted in lowering of prices in September
Chinas market for SS CR is also showing a little recovery after the countrys top stainless mills seek to keep most of their price the same levels in October.
Analyst adjusts steel price forecast up
CIBC World Markets has raised its hot-rolled sheet steel spot price assumption for 2005 to $535/ton (from $522 forecast earlier) and has adjusted the 2006 price outlook to $480 from $440 previously. Through September, hot-rolled coil has averaged $541.
By comparison, Purchasingdata.com has maintained its 2005 hot-rolled forecast of $541 as presented at midyear and has boosted the 2006 forecast to $501 from $482 earlier.
"A decline in domestic scrap prices will have an immediate impact on steel prices and purchasing behavior as customers delay orders to take advantage of surcharge reductions," explains steel analyst John Mr Novak in Toronto. "We expect a decline in scrap prices of $50-$60/ton in October will lead to lower steel prices in November and December as scrap surcharges are reduced by the mini-mills."
Additional concerns in the outlook include "the threat of increased import activity into the U.S., increased steel production capacity, and the continued risk of overproduction from China making it a significant net exporter of steel," says Mr Novak.
Market researchers continue to grapple with the uncertainty of whether or not the price of hot-rolled sheet can remain above the $500/ton level into 2006. Mr Novak writes in a research note that anticipated fourth quarter prices of $520-540/ton "are not sustainable" in 2006.
Arcelor Packaging to hike prices by 10% in 2006
Arcelor Packaging International (API) announced that it would increase the prices of its products by 10 percent in 2006 due to the general demand for packaging steels wef January 1st
The company said that a price hike is needed since the price hikes in 2005 were not sufficient to cover the huge increases in raw material prices and transport costs in 2004 and 2005.
It is essential that API is able to pursue its policy of renewing its product range by virtue of this price increase and an ambitious cost cutting program, the company said in a statement.
Energy costs seen squeezing US steel makers profits
The surge in steel industry profits hit a wall with sky-high natural gas costs squeezing the manufacturers just when they were riding high on demand and top prices for their products, analysts said on Tuesday. Already three U.S. steel makers have warned that third-quarter earnings will be lower than expected
Steel prices, which had slipped recently, have rebounded, but there is uncertainty over which direction they are ultimately headed.
Mr Chris Olin, an analyst with Longbow Research in Cleveland said "Natural gas is a big problem for the steel industry and the market is not strong enough to pass on the costs." Hedging of energy prices is a big issue, he said, but steel makers were not forthcoming in saying how much they hedge.
Combined with increased imports in the first quarter, Olin said he sees further pressure driving the price of steel down some 20 percent to $400-$430 per ton by the end of 2006, compared with current prices of approximately $520-$540.
Race for Kryvorizhstal - Mittal Steel hopes for fair tender
Mittal Steel, the world's biggest steel making company, hopes for a transparent and fair tender in the sale of a 93.02% stake in the Kryvy Rih Mining and Metallurgical Mill Kryvorizhstal in Dnipropetrovsk region, and it expects to win, GM of Mittal Steel for corporate finance Mr Frank Pannier is reported to have said at a press conference last week.
According to Mr Pannier, the company's decision to run again in the privatization tender shows that it firmly believes that the government of Ukraine will be able to trade the mill openly and fairly.
Spanish Fagor Arrasate bags order for large cutting line from Taiyuan
Basque engineering goods producer Fagor Arrasate, a member of the Mondragon Cooperative Corporation MCC group, is to supply the world's largest combined cutting line, more than 100 meters long and with capacity to process coils of up to 2,100 millimeters wide and 14 mm thick to Taiyuan Iron & Steel, a leading SS Chinese steel at a cost of 10 million Euro.
The line follows a previous order worth as much, placed back in 2003 by a Thyssen group subsidiary in Shanghai.
It is reported that Taiyuan Iron & Steel, one of the worlds leading stainless steel producers, was founded in 1934 in the city of Taiyuan and produces nearly five million tons of stainless steel a year.
S&P warns on Russian steel acquisitions
A new report by international ratings agency Standard & Poors (S&P), issued this week in Moscow, warns that aggressive offshore acquisitions, rising debt, and poor corporate transparency are the most serious risks for lenders to, and investors in Russia's leading steelmakers, particularly the Evraz group, controlled by Mr Alexander Abramov. The timing of the report comes just two weeks before the Ukrainian government plans to auction its Krivorozhstal steel plant for a minimum of $2 billion. Its conclusion should raise serious concerns among international bankers, as well as international steel companies, to whom Evraz and Severstal have applied recently for cash support in the Krivorozhstal bidding.
Russian steel makers have been on acquisition spree. MMK is currently contemplating is a bid in the privatization of Pakistan Steel Mills. Severstal's acquisitions in North America and Lucchini in Europe are followed by SeverCorr. Evraz's has acquired the Czech steelmaker Vitkovice, Nizhny Tagil and is looking at Nikopol Ferroalloys plant in the Ukraine
The question S&P has raised, for the first time on the part of an international rating agency, is whether the legal structures and financial obligations of the Russian steelmakers are creating debt-heavy assets in Russia, that are credit risks; while the controlling shareholders roll in cash, apparently consolidated in group financial reports, but insulated in legal terms and protected from creditors offshore.
According to S&P director Elena Anankina, Evraz, which controls three steelmills, and several iron ore and coal mines, is currently carrying net debt of $1.3 billion. By contrast, Novolipetsk Metallurgical Combine, owned by Mr Vladimir Lisin, has no debt, and a cash surplus of $1.3 billion. Severstal is reported to have net debt of $297 million, and Magnitogorsk Metallurgical Combine, Russia's largest steelmill, surplus cash of $569 million.
World first scrap steel futures in Japan generates 14,945 trades
The world's first scrap steel futures traded on Japan's Central Commodity Exchange generated 14,945 contract trades on its first day, said the exchange on last Tuesday. C-com is based in Nagoya City in central Japan, trading gasoline, kerosene, gas, oil, egg and scrap steel futures.
Scrap steel started with three contract months February 2006, March 2006 and April 2006 contracts as scrap prices in the coming three months would be difficult to determine, said a spokeswoman for C-com.
April 2006 contracts have been most actively traded Tuesday, generating 11,651 contract trades. They closed at Yen 27,230 ($238.86) PMT. March 2006 contracts had 2,143 contract trades, closing at Yen 26,900 PMT. February 2006 contracts had a turnover of 1,151 contract trades closing at Yen 26,770 PMT.
The exchange decided to trade this new commodity as physical scrap steel trading is active in central Japan due to Toyota's car plants in the area. As Japanese regulations require all new commodities to trade on a trial basis for three years, the full listing of scrap steel would begin in October 2008
Race for Kryvorizhstal - IUD & Arcelor to bid jointly
The Industrial Union of Donbas IUD and the Arcelor are preparing to jointly bid for a 93.02% stake in Kryvorizhstal, Ukraine's largest steel mill.
As per a report in Ukraine daily, which has reported that Mr Oleksandr Pylypenko, VP of Kiev based Industrial Group IG, which manages the IUD's assets, that IUD is not ready yet to make any comments on the two companies' participation in the tender
Georgian section of Baku-Tbilisi-Ceyhan pipeline set to open
The opening ceremony of the Georgian section of the Baku-Tbilisi-Ceyhan BTC pipeline was held yesterday. The $3 billion pipeline runs from the Sangachal terminal in Azerbaijan to Ceyhan in southern Turkey, a total distance of 1,743 kilometers including 235km in Georgia. The pipeline will have an annual capacity of 50 million metric tons of oil.
Oil will be transported from Azerbaijan's Sangachal field in the Caspian Sea through Georgia at the first pumping station in the Gardaban district on the Georgian Azerbaijani border. In late October, oil supplies will reach the Georgian Turkish border.
The BTC pipeline consortium comprises of British Petroleum 30.1% stake, Azerbaijan's State Oil Company 25%, American companies Unocal 8.9%, Conoco-Phillips 2.5%, and Amerada Hess 2.35%, Norway's Statoil 8.7%, Turkey's TPAO 6.5%, Italy's ENI 5%, French-Belgian TotalFinaElf 5% and Japanese Itochu and Inpex with 3.4% and 2.5%, respectively.
Consortium formed to buy China Shipbuilding Corp
At the invitation of China Steel Corp CSC and Yang Ming Marine Transport Corp, Wan Hai Lines Ltd has shown its willingness to enter into a consortium led by CSC to invest in the state run China Shipbuilding Corp, which has decided to go private through public bidding.
China Shipbuilding estimated it would sell a 51 percent up to 66 percent stake to become a privately owned firm. Potential buyers of the China Shipbuilding shares include Evergreen Marine Corp, Taiwan Navigation Co, Yang Ming Marine Transport Corp, Yung Chi Paint & Varnish Mfg Co, Kuang Tai Co, Wan Hai Lines Ltd, China Steel Corp, MPH, BAE of the US, Mitsubishi of Japan, and Hyundai of South Korea.
The CSC led consortium will also contain China Shipbuilding's downstream firms, such as Yung Chi Paint & Varnish Mfg Co If everything goes smoothly, China Shipbuilding will have a new management team comprised of its downstream firms and its two largest clients Yang Ming and Wan Hai.
An industry insider noted that China Shipbuilding would be able to make handsome profits in the next four years, as it has acquired enough orders to fill its production facilities until 2009.
Yang Ming has contracted China Shipbuilding to build 22 vessels that will be delivered by the end of 2009; Wan Hai currently has 10 vessels under construction by China Shipbuilding that will be delivered by the end of 2008.
China Shipbuilding's net worth currently stands at US$145.45 million, with a capitalization of US$336.36 million.
Kazakhstan steel output plummets 20% in 9 months
Kazakhstan reduced steel production 19.9% YOY to 3.277 million tonnes in the first nine months of 2005, the national statistics agency has informed
Output of flat rolled steel products fell 25.4% to 2.263 million tonnes, including 162,505 tonnes of ETP, down 26.3%, and 419,416 tonnes of HDG, down 29%.
Ferroalloy production, though, grew 6.3% to 139,081 tonnes.
Guangzhou JFE HDG line to start in January 2006
Guangzhou JFE hot dipped galvanizing line will start production nearly three months earlier than first predicted. The company announced the construction of the 400, 000 TPY line in 2004. This line will be starting production in January 2006.
JFE Steel Corp holds a 51 percent stake in the company with the remaining 49 percent share owned by Guangzhou Iron & Steel Enterprises Group. The galvanized sheet produced at the plant will be used to satisfy the growing demand from Japanese automobile producers. The thickness of galvanized sheet is 0.3- 2.3mm and the width is 800-1700mm.
PGN & Nippon Steel to ink pipeline deal
Indonesian state gas utility PT Perusahaan Gas Negara PGN, will sign a $165 million agreement with Nippon Steel Corp for a gas pipeline project to construct a 110 kilometer sub sea pipeline segment that will link gas rich South Sumatra with Indonesia's main island of Java
Construction is scheduled to begin in January. The reports says the project will be completed by February 2007 and provide gas to industries and households in Java.
Ziscosteel and Shongang JV likely
Zimbabwe Government is expected to ratify a JV deal between the Zimbabwe Iron and Steel Company Ziscosteel and Shongang, a Chinese firm. Ziscosteel has been involved in talks with Shongang for the past four months. Ziscosteel chairman, Mr David Murangari said talks between the two parties had gone on well but were at a stage that required approval from the Minister of Industry and International Trade.
In terms of the contract, Shongang plans to acquire shares through injecting foreign currency. The Government is the majority shareholder in Ziscosteel accounting for more than 80 percent of shares.
Under the turnaround plan, Ziscosteel, plans to retire debts, expand operations, increase exports and refurbish its dilapidated infrastructure.
Russia to scrap arctic pipeline
Russia will scrap plans to build a pipeline to the Arctic Ocean as export growth slows, leaving the country's ports with about 244,000 barrels per day of spare capacity.
The Baltic port of Primorsk and the Black Sea terminals of Novorossiisk and Odessa could be shipping an extra 1 million tons per month of crude exports, said Mr Sergei Yevlakhov, a vice president of Transneft, the state run oil pipeline monopoly.
Transneft, whose pipes carry most of Russia's crude for export and to refineries, expects companies will ship 456 million tons of oil through its system this year, less than the 462 million tons initially estimated, Mr Yevlakhov said recently
OMZ develops two new excavators for mining industry
OMZ Gornoe Oborudovanie i Tehnologii GoiT, a division of OMZ Uralmash Izhora Group has completed work on two new next generation models of quarry crawler mounted excavator, the EKG-1500Р and EKG-1500K.
These excavators are designed for the production of coal, iron and copper ore, asbestos and other minerals in all geological and climatic conditions. The excavators comply fully with international standards with regard to automation, productivity and power consumption. Employing modern drives and control systems, the new excavators boast capacity at least 25% higher than that of any existing Russian-built excavator.
The volume of the standard bucket for the EKG-1500P excavator is 18 cubic meters, but this can be replaced with buckets with volumes of from 16-25 cubic meters. The EKG-1500K excavators standard 26 cubic meter bucket is interchangeable with buckets of 18-40 cubic meters capacity. This will allow considerably increased efficiency in mining operations.
GoiT specializes in the production of machinery and equipment for all basic stages of mineral production and processing, including boring rigs, draglines, quarry crawler-mounted excavators and crushing equipment. OMZ is the leading supplier of heavy excavators in the Russian and CIS markets, commanding 90% of the domestic market.
Xstrata may eye Teck Cominco as takeover target
Xstrata Plc, the world's biggest exporter of coal used in power plants, may bid for Canada's Teck Cominco Metals Ltd, world's biggest zinc producer, after likely being stymied seeking control of nickel miner Falconbridge Ltd, JPMorgan & Chase Co said.
Zug, Switzerland- based Xstrata bought 19.9 percent of Falconbridge in August and said it would seek a bigger stake. Xstrata Chief Executive Mick Davis is making acquisitions to reduce the company's reliance on thermal coal and increase its holdings in zinc, copper and nickel.
Central Queenslands Mcarthur coal to triple exports
Central Queensland's Macarthur Coal has revealed plans to triple its Bowen Basin coal exports in the next five to 10 years. Chairman Mr Keith DeLacey says the company has spent $48 million buying up extra exploration tenements in the central Queensland coalfields. He says the investment will help the company make the most of the coal boom.
"Macarthur Coal is absolutely committed to the Bowen Basin and expanding coal exports through primarily Dalrymple Bay," Mr DeLacey said. "I mean we're there for the long term we would hope, we're exporting 7 million tonnes now we would hope within 5-10 years we'll be exporting 20 million tonnes."
POSCO & Itochu to invest in Longmei Mining Group
Northeast based Longmei Mining Group has chosen POSCO and Itochu Corporation as the strategic investors for its planned Hong Kong IPO for $256 million in the first half of next year. "We have already inked initial agreements with the two companies," said a company official from Longmei
Longmei was formed last December through the merge of four State-owned coal companies Jixi, Hegang, Shuangyashan and Qitaihe as the provincial government's strategic step in forging itself into one of the 13 large-scale major coal production bases in China. Each of its four coal companies has an annual production capability of more than 10 million tons and the new conglomerate is able to produce more than 50 million tons of coal annually.
With proven coal reserves of 22.4 billion tons, Heilongjiang is one of China's coal-rich provinces. The province's annual coal output exceeds 80 million tons, with the four coal producers accounting for more than 60 per cent.
Longmei, which produced 27 million tons of coal in the first half of this year, aims to increase annual production to 100 million tons and up its sales income to 20 billion yuan (US$2.4 billion) by 2010.
Its largest users include the Liaoning-based Anben Steel Group Company, which was forged through a merger of two local steel giants Anshan Iron & Steel Group and Benxi Steel in August, as well as Jilin-based Jilin Chemical Industrial Co Ltd. A small proportion of its products are exported to Japan and South Korea.
Georgias Rustavi Steel spurs claims
Georgias Rustavi Steel Works, a rusting monument to Soviet industrial might, has changed hands in a $27 million transaction that promises to fuel further controversy about President Mr Mikheil Saakashvilis campaign to turn state property into cash for government coffers.
The sprawling, 5 million square meter complex was sold at a bankruptcy
auction on October 12 to two Georgian companies. According to local media reports, Energy and Industrial Complex received the bulk of the complex for $20,500,000, as well as Rustavis limestone mines for $500,000. TedOil received limestone workshops, territory and some machinery for $6,000,000.
But despite these sales, one Italian company, Metal Geo, claims that it is, in fact, the true owner of Rustavi. In 2004, Metal Geo assumed ownership of Ares International, which acquired 98 percent of Rustavi by presidential decree in 2003 and claims that the firm has invested 14 million euros
Metal Geo has since taken their claims to international courts in both Strasburg and Washington, and expects to see the case settled within the next three years, Seriogin said. The Italian firm is demanding $40 million in compensation from the Georgian government for lost investment and moral damages.
Laiwu becomes Chinas largest H-beam producer
East Chinas Shandong province-based Laiwu Steel completed its RMB 2 billion ($247.28 million) large-sized (H400 x 200 - H900 x 300) H-beam production line project.
The new 1 million-ton annual capacity line, designed by Huatian Engineering Technology Company, makes Laiwu Steel the largest H-beam producer in China.
Laiwu Steel, which also has a medium size H-beam production line and a light and thin H-beam production line, will now account for more than 40 percent of the countrys total production.
Kobelco launches second construction machinery plant in China
Kobelco Construction Machinery Co Ltd, a group company of Kobe Steel, has announced the formal start of production of hydraulic excavators at its joint venture, Hangzhou Kobelco Construction Machinery Co Ltd, in Hangzhou, Zhejiang Province, China. The JV has a production capacity of 1,500 excavators per year. Hangzhou Kobelco is 51% owned by Kobe Steel, 27% by Toyota Tsusho Corporation, and 22% by Chengdu Jialixing Investment Co Ltd, a Chinese investment company.
Hangzhou Kobelco was formed to meet the growing demand for hydraulic excavators in China. With Kobelco's first JV, which started in 1994, Chengdu Kobelco Construction Machinery Co Ltd in Sichuan Province, Kobelco can flexibly meet demand from inland and coastal regions.
The Chinese market for hydraulic excavators has grown sharply in recent years, increasing fivefold since 1999. Based on the number of new machines sold, China has grown into the fourth biggest market after Japan, Europe and the United States. In 2004, demand in each of the four markets was approximately 25,000 units, or over 100,000 units worldwide.
Kobe Steel Ltd is one of Japan's leading steelmakers and producers of aluminum and copper products. Other businesses include welding consumables, machinery, and construction equipment. With an extensive R&D menu, Kobe Steel conducts research on coatings and materials design.
Secret firm backs Fortune Metals bid for Ridley Terminals
An unidentified BC company is backing the bid by Fortune Minerals, a small Ontario resource firm with no operating revenues, to acquire the Ridley Terminals coal shipping facility from the federal government over the objections of the BC mining industry, Fortune Metal's president said. He added that the mystery company has experience in the area but doesn't want its identity publicized.
Fortune Metal has confirmed last week that it was the lead bidder for Ridley Terminals, said it was in fact bidding for Ridley through a private company called Northwest Bulk Terminals Inc." The other shareholder in NBTI is a British Columbia company with expertise in handling bulk materials," Fortune Metal has said in a press release.
Pattison Group, owner of largest coal handling facility on the North American west coast, Westshore Terminals, located at Roberts Bank has also shown interest in this port in past A group of resource firms based in Calgary and Vancouver, including Teck Cominco, is lobbying the federal government to reconsider the sale to Fortune, based in London, Ont., and contemplate their bid to acquire Ridley.
Another group, called the Ridley Shippers Coalition, wants to run the terminal as a kind of owners' co operative that would charge discount fees to ship coal, sulphur, wood pellets, and other bulk commodities low enough to compete with shipper or government owned terminals in Australia, Canada's main competitor in Asian markets.
Federal Transport Minister Mr Jean Lapierre needs cabinet approval before he launches full scale negotiations to sell the facility at a price believed to be a fraction of the $250 million it cost to build in the early 1980s
Asmo and Aichi Steel develop lightweight automotive motor
Asmo Co Ltd and Aichi Steel announced on October 5 joint development of a small automotive motor using "Magfine", as developed by Aichi Steel. The motor is downsized by 50% and reduced in weight by 40% compare to the previous model. It is used in Toyota's Crown. The maximum power output of the Magfine is 6 times greater than that of similarly sized ferrite magnet motors. The companies see the growing demand for smaller and lighter motors that contribute to reduced energy consumption
Toyota Group started when "The No. One Inventor of Japan", Sakichi Toyoda, invented his epoch-making automatic loom in 1902. At that time this invention promised a great future for Japan.
Mr Kiichiro son of Mr Sakichi, the founder of Toyoda Automatic Loom Works, which decided to go into car production, started a steel manufacturing department in 1934 called Totoda Steel Works, which later becoming Aichi Steel Works
Aichi Steel works closely with the Toyota Group which are active in a wide variety of industrial fields including the automobile industry. In addition, Aichi Steel is a growing presence in other fields such as ships, railway trains, electronics related industries.
Techint Goodfellow installs EFSOP system at Dongkuk Steel
Canadas Techint Goodfellow Technologies has announced successful installation and commissioning of a state of the art Goodfellow EFSOP Expert Furnace System Optimization Process system at Dongkuk Steels Incheon Plant in Korea
The system incorporates continuous off-gas based closed-loop control of the burners.
TGTI is a Company recently founded in Mississauga and integrated as a member of Techint Technologies, the plant making division of Techint Group. Techint Group manages Tenaris comprising of Dalmine, Siderca, Tamsa, NKK Tubes, Algoma Tubes, Silcotub and Confab and Ternium comprising of Siderar, Sidor and Hylsamex
Russian ferrous metal producers increase exports
Russias Federal Customs Service announced that in the first eight months of 2005, Russian ferrous metal producers reported export sales revenue of $12.63 billion, up 32.8 percent from $9.512 billion recorded in the corresponding period of 2004.
During January-August period, Russia exported 33.272 million tons of ferrous metals, 7.291 million tons of rolled metal from carbon steel, 9.409 million tons of semi-manufactured goods from carbon steel, and 563500 tons of ferro-alloys.
China's Baosteel wins approval to continue 4 bln yuan buyback
Baoshan Iron & Steel Co Ltd (SHA 600019) (Baosteel) said its parent has received approval from the China Securities Regulatory Commission to launch the second round of a maximum four billion Yuan buy back program after the government-approved state share sale.
Shanghai Baosteel Group will buy back the listed company's shares if the price falls below 4.53 Yuan in the six months after Oct 14. It has already bought back two billion Yuan worth of public shares.
Bennett Management confirms proposal to acquire Sheffield Steel
Bennett Management Corporation today confirmed that it has proposed to the board of directors of Sheffield Steel Corporation a transaction in which funds advised by Bennett would acquire Sheffield in a business combination in which Sheffield's shareholders would receive $5.75 per share in cash, subject to customary conditions.
Bennett understands that this proposal is one of the two "unsolicited indications of interest" referred to in a press release issued today by Sheffield. Sheffield's shares trade in the over-the-counter market. Funds advised by Bennett own approximately 25% of the outstanding shares of
Sheffield's common stock
