October, 20 2005
JSW to expand Bellary plant to 10 million
Jindal South West Limited JSW will expand its Bellary plant at Thorangal to produce ten million tonnes of steel by 2010 by investing over Rs 20,000 crore, JSW Vice CMD Mr Sajjan Jindal informed today.
Mr Sajjan Jindal said that the plant producing 2.5 million tonnes would be expanded to produce four million tonnes before March 2006.
India to adopt global classification of coal from next fiscal\'
India will adopt the internationally accepted gross calorific value GCV based classification of coal from the next financial year and discard the existing system of useful heat value UHV based classification as per an announcement made by the Minister of State for Coal and Mines, Dr Dasari Narayan Rao, while delivering the keynote address at the Coal Summit 2005 in Delhi
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This would imply that coal would henceforth be categorized on the basis of heat and not ash and moisture content.
The GCV for coal is defined as the amount of heat evolved when a unit weight of the fuel is completely burnt. Under the UHV system, coal is categorized on the basis of ash and moisture content in the coal.
Tata Ryerson to pump in Rs 250 crore to double capacity
Tata Ryerson, a 50:50 JV between Tata steel and Ryerson Tull of the US, announced that it would inject Rs 250 crore in the next five years to double its capacity to three million tonnes by 2010. We will be investing Rs 250 crore in the next five years and increase our production from the present 1.5 million tonnes to three million tonnes by 2010, said company's MD Mr Sandipan Chakravortty. He added that the company would ramp up its production to two million tonne by the end of the financial year 2006-07.
Mr Chakravortty said that this would be possible due to additional contribution from its upcoming units in Punjab and Bangalore, which would incur an investment of Rs 80 crore. We are also looking at some overseas acquisitions as well as some Greenfield projects abroad, the MD said without divulging any details.
The monthly production from Faridabad, Jamshedpur and Pune plants is about 5,000 tonnes at present
Mr Montek for abolishing import duty on coal
Planning Commission Deputy Chairman Montek Singh Ahluwalia, during India Coal summit 2005, favored zero per cent import duty on coal and crude oil, besides advocating de nationalization of the coal sector and opening it for private investment.
Mr Ahluwalia said that "I am in favor of zero per cent import duty on coal and crude oil if there is no argument for protection. Internationally, domestic prices are always aligned with the international prices. It has to be done here also. Maybe not immediately, but sometime later as there would be huge deficit which I do not think the Finance Ministry would be willing to accommodate in the Budget. "I know, domestic players may not be happy with the end of the protection but there is no rationale to continue with it, he added
Mr Ahluwalia said this would also put pressure on the domestic producers and a reduced import duty would help bring more efficiency to the sector, besides stabilizing prices as "duties are not generally a policy consideration but a revenue consideration."
Vedanta set to okay new $2 billion plant
Vedanta Resources is close to approving a $2 billion investment in a new aluminium complex in Orissa, eastern India, which will more than double the size of its aluminium business.
The smelter in Jharsuguda will produce 400,000 tonnes a year and could be ready in three years. It would make Vedanta Indias biggest aluminium producer and rank it well within the top 10 global producers.
Goldman Sachs changed rules during PetroKazakh auction
Indias Petroleum Minister Mr Mani Shankar Aiyar, on Monday, accused Goldman Sachs of changing the rules midway through the auction of Canadian Oil Company PetroKazakhstan Inc implying the investment bank helped China outbid India for the firm.
Mr Aiyar said the $3.9 billion bid by ONGC Mittal Steel JV for PetroKazakhstan was the highest when the bids closed on August 19.But the China National Petroleum Corporation CNPC was allowed to revise its bid in the following days by Goldman Sachs, which managed the auction and even though the Indian-Dutch group was told that they could submit a revised bid by August 22, the sale was announced before the end of working hours on that date.
"The goal posts were moved midway and this is not an appropriate thing to do," Aiyar said, on Monday.
But a spokesman for Goldman Sachs based in Hong Kong said that "we handled a fair and transparent auction. CNPC won the bid after offering $4 billion to acquire the Canadian firm, which has all of its energy assets in the former Soviet republic of Kazakhstan.
110 member Indian delegation at World Mining Congress in Iran
A 110 member Indian delegation, including top players of the mining and allied industries, is expected to visit Iran next month to look for international tie-ups, joint ventures and collaboration at the 5 days 20th World Mining Congress and Expo starting on November 7, the five-day Congress and Expo, which will attract nearly 6,000 experts from 34 countries.
The 40 major players, including SAIL, NALCO, Tata Steel, Jindal Stainless Steel, Essar Group, RINL, CIL and Indian Bureau of Mines, will project their inherent strength to seek as well as offer latest technologies and new investments. The high-profile delegation, supported by the ministries of coal, mines and steel, will also include ministers and secretaries.
World leading players are expected from the US, the UK, Russia, China, Australia, Canada, South Africa, Japan, Italy, Germany, Sweden, Switzerland, Turkey and Poland, besides India and the host Iran.
More than 150 papers would be presented at the Congress, being organized under the auspices of International Organizing Committee of the World Mining Congress with the theme 'Mining and Sustainable Development'.
Over Rs 1 lakh crore required in coal sector by 2025
Indian Minister of State for Coal Mr Dasari Narayan Rao today said nearly Rs 134,300 crore was required in the coal sector by 2025 to ensure energy security of the country.
The tentative investment requirement includes Rs 95,000 crore in open cast mining, Rs 23,000 crore in underground mining, a minimum of Rs 8,000 crore in coal beneficiation, Rs 7,000 crore in overseas equity and Rs 1,300 crore in exploration, Mr Rao said on the inaugural day of the two-day 'Coal Summit-2005' here.
This order of investment, he said, was justified as coal would continue to be the prime source of energy, accounting for about 55% cent of the total primary commercial energy requirements.
Pointing out that rise in demand for coal for the past couple of years had been outpacing production, he said there was a need to draw a sustainable roadmap for the coal sector's growth to meet this ever increasing gap between demand and supply.
Metal Junction eyes transaction of Rs 8k cr
India's largest e-commerce company Metal Junction services Limited announced that it was eyeing a transaction of Rs 8,000 crore in the current fiscal, although the company's transaction in the first half of the year stood at Rs 2,200 crore.
''We always set an aggressive target. Last year our target was Rs 5,000 crore but we had achieved Rs 4,200 crore. This year we have fixed a target of Rs 8,000 crore although in the first half our transaction was Rs 2,200 crore'', said MD of Metal Junction Mr Viresh Oberoi. Mr Oberoi informed that the response to the coal e-sales service was very encouraging with a sale of 2 million tonne within five months.
The company has also signed up its first international client NatFerrous of Singapore and conducted e-sales of their ferrous and non-ferrous scrap. Apart from this, the company has also designed and implemented 'vendor connect' system at Rourkela steel plant, he said. Metal Junction is also set to launch two new innovative services- an 'online store' and 'aggregate rate contract' this year.
Since its inception in 2002, Metal Junction's transaction had crossed Rs 9,130 crore
Tikkurila to sell coil coating business to Teknos
Tikkurila, a part of the Kemira Group, has signed an agreement for selling its coil coating business to Teknos Group Oy. The parties have agreed on not disclosing any financials details. The coil coatings business will be transferred to a new company to be established under the name of Teknos Nova Coil Oy TNC
Coil coatings represent a special know-how within the paint industry, and they have been part of both Tikkurilas and Teknos product range since the late 1970s. Combined operations will bring more resources into the business area and improve efficiency thus benefiting customers. The new company will be a significant and competitive player in Finland.
R&D and technical service for customers will play a central role in the new companys strategy. TNC aims to achieve the position as market leader in the Nordic countries and find growth potential in Russia and other CIS countries as well as in chosen segments in other market areas. The goal is to produce high-quality environmentally compliant products mainly for the needs of the construction industry. Coil- coated steel and aluminium sheets are used, for example, for roofs, walls and facades.
Established in 1862, Tikkurila is the leading paint manufacturer in the North-eastern Europe and part of the international Kemira Group. In addition to Finland, the company has production in Sweden, Poland, Germany, Estonia, Russia and the Ukraine, and sales companies in six more countries. The main business areas include decorative paints, industrial wood finishes and paints for the metal industry.
Teknos is one of the leading suppliers of industrial coatings in the Nordic countries and a major player in the retail and architectural paint markets. Group companies operate in Finland, Scandinavia, Germany, the United Kingdom, and Poland, and through a well-established network of agents and representatives in approx. twenty other European countries.
CISA convenes Chinese steel makers to save the sluggish market
The China Iron and Steel Association CISA, the semi governmental leader of Chinese steel makers, has informed members to attend a meeting on October 21 in Beijing to discuss sliding steel product prices in the domestic market. CISA said in a notice on October 17 that since this September the steel product price on the international market has rebounded, but the price in Chinese domestic market did not follow and kept dropping. The Association said it called the meeting to stabilize the market.
The prices of plate has dropped to RMB 2,800 ($ 347), while the prices for different series of medium plates slipped to RMB 3060 ($ 379) to RMB 3454 ($ 428). Both the prices are lower than the production costs, leading to losses for steel makers. Some hot-rolled coil and heavy plate prices dropped to an even level with the price of steel wire. Hot-rolled and heavy plates are normally priced at a higher rate than wire since they are more technology-intensive to produce. This type of manufacturing is something the country has encouraged since a steel industry guideline was announced in July.
"The unreasonable price slump has seriously disturbed the product mix restructuring of the steel industry and China's trend to develop high value-added products," the association said. "Some big- and medium-sized steelmakers have lost money since the sheet prices dropped below their production cost."
At the meeting, steelmakers will analyze this year's steel demand-and-supply in China. Their goal is to find out the reason for the recent prices tumble in an aim to prevent panic selling and thrust confidence into the market.
"The oversupply of steel products is the main driver for the price drop," said Yong Zhiqiang, a Haitong Securities Co analyst. "The central government has taken measures to cool the sector and there has been slow demand growth for steel. In addition, new mills have popped up and boosted supply." China has taken several measures to curb the overheated industry, including scrapping a tax rebate on exports of pig iron and semi-finished products. It has also cut a tax rebate on exports of certain steel products.
Traders and Analysts said they are not optimistic about the meeting, although they wish the meeting would reach a positive outcome.
Arcelor - Laiwu JV likely with less than controlling stake
Arcelor and the Laiwu Steel Group, China's ninth largest steel producer, have reached an initial agreement to reduce Arcelors previously agreed to half stake in the company, an official said. The share reduction is most likely a response to government pressure to keep foreign company from owning controlling stakes in domestic steel companies.
"The deal is almost settled. The Group's administration will visit Arcelor's headquarters in Europe at the end of this month to ink the agreement," a senior official told press
Mr Meng Lingjun, the deputy director of metallurgical department of the National Development and Reform Commission NDRC had told press on September 27 that the government would have rejected the initial deal
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Laiwu holds a 76.32% stake of the company. It is interested in Arcelor's state-of-the-art technologies to help produce H-section steel, which will help enhance its competitiveness in the field and build the largest H-section steel production base second to the Rizhao port in Shandong.
China has a huge potential for high-end construction steel products, as many large infrastructure projects are under construction, including the stadiums for 2008 Beijing Olympic Games, the West-East gas transmission project, and the South-North water transmission project. However, China's supply of high-end construction steel products such as H-section steel is far behind the surging demand.
Laiwu launched a new production line of H-section steel with an annual capacity of 1 million tons at the end of September. Its H-section steel output takes up more than 40% of China's total. It produced 6.58 million tons steel, 4.77 million tons iron, and 6.89 million tons steel products in 2004. It is now the ninth largest steel company in China. It plans to produce 10.23 million tons of steel, 8.03 million tons iron and 9.76 million tons steel products this year.
BHP to speed $1.3 billion Australian iron ore expansion
BHP Billiton, the world's largest mining company, brought forward a $ 1.3 billion expansion of its iron ore operations in Western Australia by six months as demand surged from Chinese steelmakers.
The expansion, which comes the same week as a similar sized investment by rival Rio Tinto Group, will more than double capacity at its Area C iron ore mine to 42 million tons a year. Output will start in the fourth quarter of 2007, which is about six months ahead of an August estimate.
The Area C expansion is part of a two stage plan, which may cost a total of $2.7 billion, BHP said August 24. The first stage will raise BHP's Western Australian total iron ore capacity to 129 million metric tons. It wants to expand its Australian mines to a capacity of 152 million tons a year.
Arcelor consolidation in Latin America in line with global trends
Arcelor's plan to group together by November its Brazilian steel holdings Belgo-Mineira, CST and Vega do Sul follows a global trend toward the consolidation of metal companies
Arcelor's Brazilian holdings, grouped under a company called Arcelor Brasil, will become one of Latin America's biggest steel producers, reaching annual production of 11 million tonnes. By comparison Argentine-Italian group Techint's new Latin American steel company Ternium is due to produce 12 million tonnes of steel. Arcelor Brasil will be listed on Brazil's main Bovespa stock exchange.
"We have been seeing an ongoing consolidation in steelmaking worldwide, resulting in big steelmaking groups," ora Senior mining and steel analyst Ms Cristiane Viana said "Arcelor's asset consolidation in Brazil is a continuation of the worldwide movement toward consolidation," she said. "This is a positive move for the Brazilian industry to be more consolidated and aligned with this global trend."
While Brazil's steel industry has been quite fragmented, Viana pointed out the country already has consolidated its iron ore and automobile industries.
Viana does not believe steel consolidation will alter Brazil's market drastically because the three companies work in different segments of the industry. Vega do Sul supplies its coiled hot-rolled strip steel to CST, which is a flat steel producer. Belgo-Mineira produces long steel.
"There will be no change in competition since other Brazilian steel companies CSN and Usiminas are highly competitive and able to compete on the same level as the Arcelor Brasil group," she said. "We also don't see an influence in steel pricing and domestic market prices will not fall due to consolidation."
ABN Amro analyst Pedro Galdi was also bullish about the new steelmaking group, saying it will start off with a strong cash position. The three components of Arcelor Brasil also will benefit from the Arcelor "label," he said. "Arcelor Brasil's consolidation is interesting because from the moment you grow in the steelmaking business, there's a gain in scale and more bargaining power to negotiate materials and services with suppliers," he added.
Analysts also pointed out that specialty steelmaker Acesita could be consolidated into Arcelor Brasil. Pension funds Previ and Petros, which owns part of Acesita, have agreed to sell their shares in the Brazilian specialty to Arcelor, giving the steel giant a controlling stake in Acesita.
Rio Tinto Q3 iron ore output up 18 pct to record
Rio Tinto Ltd Plc, the world's second largest iron ore producer behind Brazil's CVRD, posted an 18 percent jump in quarterly iron ore output as the world's second-biggest miner ran its operations at full speed to meet buoyant demand from Asian steel makers. Rio Tinto, said its Hamersley operations in outback Western Australia shipped record volumes of iron ore, boosted by new infrastructure at its Dampier port and completion of the Yandicoogina expansion. The company said its third-quarter iron ore output totaled 32.2 million tonnes, up from 27.3 million tonnes in the same year earlier period but only a small increase on the preceding three months.
"Demand remained strong for all products in all markets, underlined by the move by POSCO to renew long term sales contracts ahead of their expiry," the company said.
Iron ore is a major driver of Rio Tinto's profits, especially after prices set in annual talks with Japanese buyers rose 71.5 percent from April this year. Analysts are forecasting Rio Tinto will book net profit of $4.8 billion for calendar 2005
Chinese a threat to largest shipbuilding nation South Koreas
South Korea which wrested the title of world's largest shipbuilding nation from Japan in 2004, is already looking over its shoulder at China, which has embarked on a path toward becoming the world's largest shipbuilder by 2015. From a marginal player in the 1990s, China has quietly become the third-largest shipbuilding nation, winning 14 percent of world shipbuilding orders in 2004, as measured by tonnage. Japan comes in second with 24 percent, and South Korea is far ahead with 40 percent, according to the Shipping Intelligence Network of London
"When you are being chased, you have to do something that the chaser cannot do," said Han Dae Yoon, chief marketing officer of Hyundai's shipbuilding division, referring to China's ambitions. South Koreans know well that 1,000 kilometers, or 650 miles, from here, a similarly barren shoreline south of Shanghai is undergoing a $4 billion transformation that is aimed at making China State Shipbuilding the world's largest ship maker.
After receiving record orders in 2004 - for 102 ships worth $8.3 billion - Hyundai can afford to be picky. With more than three years of work already booked, Hyundai can afford to let Chinese yards win contracts for such low-end jobs as simple tankers or bulk carriers. South Korea's other two major shipbuilders, Daewoo Shipbuilding & Marine Engineering and Samsung Heavy Industries, are juggling a similar wealth of orders.
In 2005, South Korea's three largest steel makers plan to increase their investments in plant and machinery by 52 percent, or $3.7 billion, according to the Korea Iron & Steel Association. Hyundai has responded to the rise in steel prices by raising the average price of its ships by 23 percent and by trying to win more contracts for complex ships such as the dome-shaped carriers that run on liquefied natural gas.
As China and other countries move to this comparatively clean energy source, LNG consumption is forecast to grow by 25 percent a year for the next decade. During this time, the world LNG fleet is expected to double, to around 250 ships. Moving aggressively, Hyundai, Daewoo and Samsung won almost 90 percent of the LNG tanker contracts awarded worldwide this year.
But even here, South Koreans feel the technological gap narrowing with China.
In Chinese shipyards, labor productivity lags far behind the rates registered in South Korean and Japanese shipyards, which are about even.
Hangang starts production of 2 mln-ton pellet ore project
Central China's Hebei Handan Iron and Steel Group Hangang, the sixth-largest steelworks in China, recently started commercial operation at a 2 million ton pellet plant at an investment of RMB 265 million ($ 32.84 million).
A company official has told press that the project could be one of the most advanced pellet ore sintering production lines in China. China has so far only five of that kind of production lines.
Hangang used to purchase pellet ore from domestic and international markets. Since the project came on stream, the 2 million ton capacity could completely meet production of the company's seven blast furnaces, making Hangang the first pellet ore self-supply steelworks in Hebei Province.
Russian steel exports to US up by 24.5% in H1
Russia has increased steel exports to the US by 24.5% YOY basis to 815,920 tonnes in the first half of 2005 as per the US Department of Commerce. Steel exports in value terms have jumped by 73.6% to $497.75 million.
Russia exported 44,890 tonnes of steel to the US for $32.56 million in June alone, but this was way down from the 179,670 tonnes for $105.4 million that it exported in the same month of last year. Russia exported tentatively 128,620 tonnes of steel to the U.S. for $70.09 million in August.
Overall, US have imported 15.24 million tonnes of steel in the half, up 7.9% year-on-year. The imports in value grew 51.6% to $12.46 billion.
During 2004 Russian steel exports to US surged by 640% to 2.185 million tonnes and 1,150% to $1.16 billion
US DOC announces results of wire rod AD review
The US Department of Commerce announced the final results of their Administrative Review of Indonesian carbon wire rods.
Only PT Ispat Indo, a Mittal Steel company, was investigated. The review period was October 1, 2003 to September 30, 2004. The Department calculated a dumping margin of .38 percent which is de minimis, or zero.
Consequently, effective today, there will be no dumping duty rate assessed on imports from P.T. Ispat Indo.
In the past, Ispat Indo had been a regular supplier of wire rods to the US West Coast with occasional shipments into the US Gulf region as well.
Rescinding the prior dumping rate of 4.06 percent makes a difference of about $.77 cwt. ($17.00/mt, 15.42/nt). Without question, this means that Ispat Indo will become a viable supplier for US wire companies again.
The zero dumping rates will remain in effect until another review has been concluded. No further review has been requested by the US rod industry at this point.
Hutchison in ore terminal venture with Dalian port
Hutchison Whampoa Ltd, one of the world's largest port operators, has entered into a JV with Dalian Ports Corp Ltd to build a 2.2-billion yuan (US$271 million) ore terminal in Dalian City, northeastern Liaoning Province. Covering a total area of 79 hectares, the Dalian terminal will have two berths with a total length of 886 meters, Hutchison said.
The terminal, which will handle iron ore, is the first bulk cargo facility in which the port giant has put in money on China's mainland. Previous investments were mainly in container ports, Hutchison said.
The investment will increase the number of Chinese ports that Hutchison operates to 11. The company now operates 236 berths in 40 ports worldwide.
China's 3rd-Qtr GDP Grows 9.4%, more Than Expected
China's economy expanded faster than expected in the third quarter as consumers spent more and investment in coal mines and railways increased.
Gross domestic product rose 9.4% from a year earlier after climbing 9.5% in the second quarter, the National Bureau of Statistics said in Beijing.
The Chinese economy, which accounted for a 10th of global growth in 2004, has defied expectations for a slowdown in the past year as demand for cell phones, restaurant meals and travel surged. Premier Mr Wen Jiabao is seeking to channel more investment into the nation's power and transport networks, where capacity hasn't kept pace with overall economic activity.
Final results of AD review on certain pipes from Brazil
Upon the request of petitioner US Steel Corporation and respondent Brazils V&M do Brasil, the US Department of Commerce DOC, on September 22, 2004, initiated an antidumping administrative review on small diameter seamless carbon and alloy steel standard, line and pressure pipes imported from Brazil. The review covered the period August 1, 2003, through July 31, 2004.
The DOC preliminarily determined that sales of subject merchandise by V&M were made at less than normal value (NV). The dumping margin for V&M was determined as 18.68 percent in the preliminary results.
After analyzing the comments received, the DOC decided to make changes in the margin calculation. Therefore, the final results differ from the preliminary results.
As a result of the review, the weighted-average dumping margin for the period August 1, 2003, through July 31, 2004, for V&M has been raised to 14.6%. The previous dumping duty deposit rate for V&M was 7.96 percent.
CSFB raises rating on steel sector
Credit Suisse First Boston raised its rating on the steel sector to overweight from market weight, saying the risk of weak demand for steel next year in the U.S. and the E.U. looks unlikely.
The broker told clients that quarterly price hikes should stick through the first half of 2006. In addition, CSFB said that costs on a net basis look unlikely to rise for the integrated producers.
"As such, we are confident that the third quarter will be the trough earnings quarter, with at least three sequential quarters of earnings improvement to come through from late 2005 into 2006," the broker said.
EU recycles 60% of steel packaging
The enlarged European Union recycled 60% of steel packaging in 2004, according to APEAL, the Association of European Producers of Steel for Packaging. 15 pre enlargement EU countries achieved a recycling rate for steel packaging of 62.5% up from the 61% they achieved in 2003.
APEAL said that over 2.2 million tonnes of post-consumer steel packaging was recycled in Europe last year. It singled out "remarkable progress" made by the UK, Spain, Portugal and Italy. The UK has achieved a 41% increase in steel packaging recycling over the last five years.
APEAL said these exceptionally high recycling rates showed that steel packaging "offers value to society", enabling a continual recycling process to take place without any loss of quality. The strong recycling performance results from the adaptability of steel to a wide range of collection systems, from mixed household waste to multi material door to door collection
As steel scrap is an essential ingredient in steel manufacturing, there is always ample demand for recycled steel said Mr Philippe Wolper MD of APEAL
Through increased recycling of steel packaging, resources such as iron ore and coal are preserved for future generations and energy use is vastly reduced, the organization said.
Acepar denies strike threat on 20th October
Paraguayan steelmaker Acepar says its workers union is not planning to go on strike on October 20 despite what local press reports have been saying. "Officially the union has not expressed this to the company. We have meetings and negotiations pending between workers, the company and the labor ministry," Acepar industrial manager Juan Ram Martez told press.
But according to local press, Acepar workers want to discuss wage categories and if a Wednesday meeting does not produce results, they will go on strike the next day.
But Martez said the next meeting is scheduled for October 24 or 25. "We don't know what this decision to strike would be based on and expect that when we meet, they [workers] will clearly submit their complaints," he added. He explained that the collective contract signed with the union contains a clause that says it cannot strike while negotiations are underway.
Bangladesh Steel mills fear production loss due to power crisis
The steel re-rolling mill owners in Bangladesh, fear a substantial loss of production in the industrial units due to recent government decision of rationing electricity supply for a significant number of hours in a day to save energy.
"The existing nagging power disruption in the steel and re-rolling mills has been taking a heavy toll on the production. The government's recent decision for re-distribution of power will add new problems to the production process of the items," said Mr SK Masadul Alam Masud general secretary of the Bangladesh Steel Mills Owners Association BSMOA.
Spanish Tubacex targets 85% increase in net profits for 2005
Spanish stainless steel tube manufacturer Tubacex SA has announced that it is targeting 85% increase in net profit to Euro 25 million during 2005, on sales of Euro 430 million and EBITDA of Euro 56 million adding that this year is progressing very positively, both in terms of prices and demand
Cost cutting efforts and restructuring are also bearing fruit, Tubacex said, while noting that the company will also benefit in coming years from the heavy investments planned in sectors such as oil and gas, where its products are required
Steel Dynamics announces net income of $45 million for Q3
Steel Dynamics Inc. has announced third quarter 2005 earnings of $45 million, or $0.92 per diluted share, on net sales of $499 million. Third quarter results were steady, but are less than 2004's record quarterly results which generated earnings of $114 million and sales of $635 million achieved during a period of unusually strong industry conditions.
Third quarter 2005 consolidated shipments totaled 924,000 tonnes, up 3% from the third quarter of 2004 and also up 3% from the second quarter of 2005. SDI's average consolidated selling price was $540 per ton, down% percent from the third quarter of 2004 and down 11% from the second quarter of 2005. Average cost per ton of scrap charged was down 19% from the second quarter.
Year to date 2005 earnings of $157 million are 26% lower than the first nine months of 2004 which were $213 million. Year-to-date net sales for 2005 increased 5% to $1,615 million compared to $1,545 million in the first nine months of 2004, primarily as a result of increased steel shipments.
"Overall, our third quarter performance was solid, in spite of a variety of challenges including higher natural gas and electricity costs and disruptions in production indirectly caused by Hurricane Katrina," said Mr Keith Busse, President and CEO of Steel Dynamics. "On the other hand, we have seen positive developments in the steel marketplace.
Metals USA Inc stockholders approve merger
Metals USA Inc has announced that the stockholders of the Company voted to adopt the merger agreement providing for the acquisition of the Company by affiliates of Apollo Management LP, a private investment management firm, at a special meeting of the stockholders held today in New York
The proposed merger was announced on May 18, 2005, and is expected to close in the fourth quarter of 2005, pending the satisfaction or waiver of all the closing conditions set forth in the merger agreement.
Metals USA provides a wide range of products and services in the heavy carbon steel, flat-rolled steel, specialty metals, and building products markets.
Pakistan Steel makers to be bounded to install power plants
Pakistans Ministry of Industries, Production, and Special Initiatives is likely to bind the steel manufacturers to install the power plant along with their steel units to meet the power requirements in steel production in the new steel policy so as to help meet the power demand in steel production and enhance the steel production in the country, as per a report in local daily
It is reported that the government is articulating the steel policy in the suggestions of the respective stakeholder and has constituted a committee to seek proposals from them to finalize the draft of the new steel policy that would be presented before the federal cabinet for final approval.
Government would encourage foreign investment in steel manufacturing sector to meet present and future demand of steel and engineering industries and therefore it was introducing a steel policy that would result in facilitating the steel manufacturing.
Sources added that there was a tremendous scope for the investment in steel sector due to rapid demand of steel products and government has chalked out a comprehensive strategy for the development of the steel and engineering sector and steel policy was part of this strategy.
MRIM, Hunan being setup by Mittal Steel
The world's largest steel maker, Mittal Steel, has made a long term commitment to the huge steel market in China by setting up a research institute in Hunan.
Mittal is spending US$5 million to build the Mittal Research Institute for Metals at Central South University in Changsha, the capital city of Central China's Hunan Province.
"We hope to develop the Mittal Research Institute into a major R&D center in Asia for our group," Mr LN Mittal, chairman and CEO of Mittal Steel, said in a company statement yesterday.
Tubacex does not sees further mergers in Western Europe
Tubacex SA chairman Mr Alvaro Videgain played down the possibility of further mergers in the seamless steel tubing sector in Western Europe, noting that this would be 'difficult' given that there are currently only three players. 'And I don't think the EU competition authorities would allow that to be reduced to two,' he said.
Mr Videgain also reiterated that Tubacex is not in merger talks with Tubos Reunidos SA. 'It wouldn't be logical,' given Tubacex's focus on seamless stainless steel products. But he did not rule out possible expansion in Asia, reiterating the possibility of opening a plant in the region.
Xinxing Steel Pipe reports 21.89% decline in net profit in Q3
Xinxing Steel Pipe Co Ltd., a leading pipe producer based in Henan Province, announced net profit of RMB 124.10 million for Q3, 21.89% down compared to last year due to lower steel product prices.
In the first nine months of the year, the company's operating revenue climbed 20.84% YOY to RMB 7.61 billion ($ 887.24 million), while net profit saw a 7.36% decrease and reached RMB 435.14 million ($ 53.92 million).
Xinxing Pipe produced 629,200 tons of steel pipes, down 0.95%; 1 million tons other steel products, up 13.17%, and 2.31 million tons of pig iron, a 9.33% increase in the first nine months.
Palladon announces restructured management team
Palladon Ventures Ltd has announces that the Company has appointed Dr. Michael G. Nelson to its Board of directors, has restructured management, and has established corporate governance directives and board committees.
Mr Donald G Foot Jr. has been appointed as President and COO and will work closely with Mr George S Young, who will remain as the Company's CEO. Mr. Foot served previously as the Company's VP Operations, and has significant operating and processing experience in various aspects of mineral processing and project design and start-up. Mr Paul Higgins, a current director, has been appointed as the Company's CFO and Mr Hamish Greig has been appointed as Corporate Secretary.
Mittal Steel Galati most profitable Romanian company in 2004
Mittal Steel Galati, earlier known as Ispat Sidex, comes in first among Romanian companies considering the achieved gross profit, in the classification of the most profitable businesses in Romania, drawn up by the National Council of Small and Medium Enterprises.
The company realized last year a gross profit of ROL 13,745 billion (approx. Euro 339 million) In 2000, Ispat Sidex registered losses of Euro 100 million and this makes the steelworks complexs come back that much more amazing.
Mittal Steel Hunedoara is reported to have come in fourth place
R1.6 billion SS mill for Coega
The Coega Development Corporation CDC has secured a R1.6 billion stainless steel precision mill as a part of the offset from the multi billion rand arms deal. The offset would come from German company MAN-Ferrostaal which is part of the German submarine consortium.
Coega spokesperson Ms Vuyelwa Qinga-Vika said that CDC had worked in close collaboration with the government and the investor to bring the steel mill project to finalization. "We have the raw materials, a strategically placed location and the newest deepwater port for an easy logistics chain and government is continually making the country one of the best locations in which to do business," Ms Qinga-Vika said.
She said the steel mill was the first investment in the Coega industrial development zone's ferro-metals cluster which included an integrated stainless steel complex, an aluminium smelter, two ferro-manganese plants, as well as ferro-nickel and ferro-chrome smelters.
The project still needed the approval of its 26% partner, the Industrial Development Corporation, "but no obstacles are expected". The first phase of the investment would involve R640m and the second R960m.
Aker Kvner wins Chevron contract
The Aker Kvner group has announced that it had won a USD 120 million contract to build a deep-water Gulf of Mexico oil platform for Chevron Corp.
The Oslo-based group said the deal is for engineering and construction of the Blind Faith semi-submersible platform's hull and mooring system to be used in deep waters of 2,000 meters.
"This contract award represents a breakthrough for Aker Kvner's deep water business," said company President and CEO Mr Inge K. Hansen. "We consider the Gulf of Mexico to be the most competitive deep water market in the world."
The hull is to be delivered in June 2007 for fitting out before it is towed to the field some 260 kilometers southeast of New Orleans.
Aker Kvner is a major supplier of engineering and construction services, technology products and integrated industrial solutions
CSFB raises rating on steel sector
Credit Suisse First Boston raised its rating on the steel sector to overweight from market weight, saying the risk of weak demand for steel next year in the U.S. and the E.U. looks unlikely.
The broker told clients that quarterly price hikes should stick through the first half of 2006. In addition, CSFB said that costs on a net basis look unlikely to rise for the integrated producers.
"As such, we are confident that the third quarter will be the trough earnings quarter, with at least three sequential quarters of earnings improvement to come through from late 2005 into 2006," the broker said.
Polish Projprzem announce record profit as order book stretches
Projprzem, a Bydgoszcz based steel structures provider for the construction sector, recorded a net profit of over zł.4.05 million over the first nine months of the year, which is a record for the company. The firm's revenues in that period were also higher than ever, amounting to zł.88.2 million. The operational profit was zł.5.88 million. This means that revenues increased by 31% and net profit by as much as 151%, as compared to the same period in 2004.
According to Projprzem's president Mr Henryk Chyliński, the favorable situation should continue. "The last three months of the year will also be very good. Our order book is full. Also in the first quarter of 2006 the company will have to use its full production strength," said Chyliński.
