January, 10 2006
SAIL registers record production of iron ore in 2005
Steel Authority of India Ltd SAIL has produced a record 13.34 million tonnes of iron ore during 2005 registering a growth of 4.7% over the same period last year.
Of the total production, Raw Materials Division RMD mines at Meghahatuburu and Kiriburu had produced 7.54 million tonnes while the production of Bolani Iron ore mine stood at 3.41 million tonnes. The remaining production was done by Barsua, another mine of SAIL RMD
Basel Convention norms to stop entry of French ship at Alang
Indian government may use Basel Convention guidelines to stop the condemned French warship, Clemenceau, from reaching Alang in Gujarat for dismantling. Countries like Turkey and Greece had refused the ship permission to enter their recycling yards, after which the French government decided to send it to India.
The Basel Convention states that governments can stop transport of toxic waste to protect human health and environment. The ship can be stopped on the following two grounds as per the Basel Convention:
The amount of toxic asbestos on the ship is reported to be around 300 tonnes, as against the French governments claim of 40-50 tonnes, according to Greenpeace.
Alang yard does not have sufficient infrastructure to handle so much asbestos waste.
TATA-Bangladesh negotiations make substantial progress
The fourth round of negotiations between the Government of Bangladesh and the TATA ended on Sunday, with both sides making substantial' progress over the group's three billion dollar investment proposal in steel, power and fertilizer sectors in Bangladesh. Only the issues relating to gas pricing and leasing out of coalmine remain pending now for settlement during the upcoming talks
According to government sources, the TATA's have been asked to submit its minimum demands' to attain clear headway for commissioning of projects within a week.
Accordingly, the company will come up with the bottom line' for further progress of the investment negotiations before joining the next round of talks. The fifth round of talks is likely to begin on January 22.
Monnet and Italian Scanduzzi form JV for engineering products
Monnet Ispat Ltd today said it had signed a MoU with Italy's Scanduzzi SRL to make steel products for energy, construction and transmission sectors. The JV will enable the company to enter into the value-added engineering products space, which offers tremendous value addition.
Monnet will have a 60% interest while Scanduzzi will have a 30% cent stake in the proposed joint venture firm. The balance 10% will be offered to a strategic partner. The company did not disclose monetary details.
The JV envisages the manufacture of structural steel products viz., turbine and boiler structures, transmission towers, railway bridges for catering to energy, construction and infrastructure set-up, the company said.
SAIL examining dry beneficiation plant at Chhattisgarh
SAIL has decided not to set up a wet beneficiation facility at the Rowghat mines, as planned earlier, and is planning to set up a dry beneficiation plant instead. Mr RP Singh MD of Bhilai Steel Plant BSP said the new proposal is being prepared in consultation with the Indian Bureau of Mines and would be ready by February.
"The ore mined at Rowghat would first be crushed there and then transported to the Dalli Rajah mines where we already have a wet beneficiation unit and that would be utilized for the Rowghat ores," Mr Singh told
Due to change in technology, the total area required for the mining activity would be reduced by nearly 50%, he said. Earlier, SAIL had asked for 2,400 hectares of land at Rowghat, of which approximately 900 hectares was to have been kept aside as forest cover. The 1,500 hectares was supposed to be mined and it included the wet beneficiation plant. In the new proposal, SAIL may be asking for only 750-800 hectares. Mr Singh clarified that the mandatory forest cover is no longer a part of the total mining plan.
Fasteners units in Punjab face crisis
Punjabs fasteners units are in a state of severe crisis and approximately 1,000 small units are reported to be on the verge of closure. About 250 units in Amritsar have been closed.
The main reasons are costly inputs, lack of value addition by SMEs, high freight rates and location disadvantages, compared with cities close to ports.
The fasteners association has also taken up the matter with the Centre on enhancing the central excise exemption limit from Rs 1 crore to Rs 3 crore. The annual turnover of small-scale units easily crosses this exemption limit of Rs 1 crore. Secondly, the SSI units availing themselves of the exemption of central excise pay more duty than the units availing Cenvat credit.
Even PSUs have to invest in Jharkhand for getting iron ore
The Jharkhand government has decided to stick to its decision not to sanction new mining licenses to companies unless they agreed to set up at least one manufacturing unit in the state. A top official in the state's mines and geology department told that this policy would also be applied to central public sector enterprises.
Steel industry sources in the state capital said that the new policy adopted by the Jharkhand government would create bottleneck in iron ore mining by Indian Iron & Steel Company IISCO which held six mining licenses in West Singhbhum district. Mines department sources said that Jharkhand government had already rejected IISCO's application for renewal of two licenses since IISCO did not have its production unit in the state
The merger of IISCO with SAIL approved recently by the Union Cabinet would not resolve IISCO's iron ore mining lease issue. IISCO's mining licenses could not be transferred to SAIL after the proposed merger. SAIL would have to file fresh application for the mines held by IISCO. In the process, Jharkhand government might impose new condition on SAIL to set up a new production unit in the area of its mining operation.
They said Steel Authority of India Ltd (SAIL) had been holding iron ore mining licenses for Kiriburu and Meghahatuburu in West Singhbhum district to feed iron ore to Bokaro steel Plant.
SC panel to decide on Clemenceau after hearing SDIC
The Supreme Court Monitoring Committee on Hazardous Waste Management, chaired by Mr G Thyagarajan will make a final recommendation to the Supreme Court after two weeks. Mr G Thyagarajan reiterated that the Committee would go by the Supreme Courts policy on hazardous wasteno export, no import and no exception.
The Committee will take a final decision after hearing the French version from Mr Briac Beilvert, CEO of the Ship Decommissioning Industries SAS, assigned by the French government to dismantle the aircraft carrier. SDIC has submitted a 300-page technical report pointing out the evidences of locations where asbestos had been removed. "The asbestos removal started in November 2004 and was completed in September 2005", the report claimed.
"India would be a party to violation of Basel Convention on the movement of hazardous wastes if it allows the ship anywhere near the countrys exclusive economic zone", Mr Thyagarajan said. "A ship of that size and make would generate asbestos-laden dust that would harm the environment".
He lamented about what he called the lack of transparency over how much asbestos is on board the ship. "If a ship comes with 100,000 cobras, will you accept it just because Indians know how to handle cobras? he asked.
SAIL puts up a new crushing plant at Bolani
To meet its growing iron ore needs, SAIL's Raw Material Division has put up a crushing and screening plant of 600 tonnes per hour capacity at the Bolani Ores Mine. The loading facility is also augmented. Bolani is the principal iron ore source for Durgapur Steel Plant (DSP).
Increasing its mining capacity is crucial to meet the plant's growing iron ore need. With the current production of 1.58 million tonnes of saleable steel, DSP needs 3.6 million tonnes of iron ore and it is supplied by the Bolani mines.
DSP is now targeting 2.6 million tonnes of saleable steel within the next seven years and at that production level, DSP would need 5.3 million tonnes of iron ore.
Bolani also supplies some quantity to Bokaro Steel Plant. Bolani had registered an output of 3.41 million tonnes in 2005, marking a growth of 3.33 per cent over the previous year.
CONCOR signs MoUs with CWC & PRCL
The public sector container transportation major, the Container Corporation of India CONCOR and the Central Warehousing Corporation CWC have signed a MoU to collaborate in the area of multimodal transportation. In addition, CONCOR has signed a MoU with the Pipavav Rail Corporation Ltd PRCL, the special purpose vehicle that operates the rail link between Surendranagar and Port Pipavav in Gujarat
The three companies aim to pool their resources towards becoming the leading logistics players in the country, with special emphasis on the various links of the entire multimodal transport chain for door-to-door movement of cargo by all modes, including Railways. The synergies of the three organizations will ensure that the total logistics costs are minimized for shippers, who will ultimately benefit by way of cheaper and reliable transportation and logistics services
Also, the coordination between the three will help proper infrastructure development in the country for meeting the challenges that the high growth of the economy will pose, in the process facilitating economies of scale and optimum utilization of infrastructure
CCL profit soars to Rs 500 crore
Central Coalfields Ltd CCL has made a gross profit nearly Rs 500 crore during calendar year 2005, surpassing the profit reported in fiscal 2004. A source in CCL claimed that the company attained 10 per cent growth in raw coal production in 2005 over the previous calendar year.
Speaking on the progress achieved by CCL, the source said in the opencast coal production category, raw coal offtake and wagon loading, there had been growth of 12%, 8% and 4% respectively. CCL achieved a growth of 24% in washed non-coking coal dispatch in 2005 over last year. The growth in the productivity in open cast mines was of the order of 11%
JSW Steel may float Rs 1,200 crores rights issue
JSW Steel is likely to raise around Rs 1,200 crore through a rights issue. The funds will be used for its 3 million tonne capacity expansion plan at Bellary, which will cost around Rs 5,000 crore.
The company on Monday informed the BSE that a board meeting will be held on January 20 to discuss the rights issue. The quantum of funds to be raised and the allotment ratio will be finalized at the board meeting, while the pricing of the issue will be decided by a separate committee.
JSW steel has already appointed Siemens VAI to set up the blast furnace with a capacity of 2.8m tonne per annum which will be the largest blast furnace in the country. The new blast furnace will increase JSWs crude steel capacity from 3.8 million tonne to 7 million tonnes
Ispat Industries to set up JV for export of steel in Pakistan
It is reported that Ispat Industries Limited has visited Rawalpindi Chamber of Commerce and Industry (RCCI) to hold dialogue for setting up of joint ventures and import of steel and iron from Ispat's India operation.
TopPOSCO Q4 profit seen at 2-year low on weak prices
POSCO, the world's fifth-largest steel maker, is set to report its smallest quarterly profit in two years because of sagging prices, and earnings are expected to weaken further in 2006.
POSCO is forecast to report net profit of about 575.5 billion won ($588.8 million) for the three months to Dec. 31, 2005, the average estimate from seven analysts surveyed by Reuters showed. This is a 51% drop from a year ago and a 46 per cent fall from the previous quarter. Sales are expected to have fallen 3.4 per cent to 5.42 trillion won from 5.61 trillion a year earlier. POSCO's annual net profit is forecast to stand at 3.1 trillion won ($3.12 billion) in 2006 on sales of 20.48 trillion won in 2006, according to estimates. This is weaker than a $4.16 billion net profit in 2005 in the company's projection made in October, on sales of $21.7 billion.
POSCO, which will post its results on Thursday, has already cut prices of 13 domestic steel products by up to 17 per cent for 2006, matching the bleak trend in Asia. Baoshan had cut product prices by an average of more than 10 per cent for the first quarter of 2006.
The South Korean steel maker might have to slash prices for its products again this year, even after several cuts in key product prices in 2005, analysts said. ''We cannot rule out the possibility that POSCO will make more price cuts, because China's Baoshan Steel is very likely to announce price cuts again later this month. Japanese steel makers cannot be free from the impact as well.''
Baoshan Iron and Steel Co., China's largest and the world's No. 6 steel maker, is widely expected to announce product price cuts around late next week, analysts said, setting the stage for price cuts by global competitors, such as POSCO and Nippon Steel Corp
Chinese authorities predict softer iron ore market
Iron ore prices are forecast to come under pressure in 2006-07 notwithstanding an expected the third successive increase for contracts starting April, 2006. The official attributed the decrease in imports of iron ore to the government's macroeconomic control policy, which has resulted in an oversupply of steel due to increasing supply and weakening domestic demand
According to the Chinese Ministry of commerce, supplies from existing and new producers would increase 2006s ocean-going trade volume by 62 million tons from the level in 2005. However, demand would only increase 50 million tons. Moreover, European and US steel producers would keep control over exports in order to maintain prices, the ministry said.
Against this, Chinas iron ore imports would increase 35 million tons next year, registering a sharp decline in growth over imports in 2005. In the first 10 months of 2005, China imported 220 million tons of iron ore worth $14.85bn, a 44% increase over the previous year. But the growth in 2006 is expected to be only 32.2%.
Against, this background, what will be outcome of iron ore negotiations which, according to the Tex Report recently had broken down without the parties reaching agreement and talks were scheduled to resume on January 16. BHP Billiton, CVRD, and Rio Tinto which are responsible for about 80% or seaboard trade have tabled a 25% contract price demand but the expectation is that settlement will be reached at 10% to 11%. If so, the iron ore market will get its lowest price increase in three years.
Brazilian Gerdau scouting for a steel mill in China
Brazil's Gerdau SA is talking with Chinese steel makers about possible acquisitions or new plant constructions in the nation, which is vigorously consolidating the fragmented steel sector.
"We are looking at opportunities in China," Mr Claudio Gerdau Johannpeter, executive VP told. "It could be acquisitions or building green-filed plants through partnership with a Chinese company." he added.
Mr Johannpeter said the company is talking with the local firms in China for possible deals, but no concrete project has been secured. The vice-president refused to disclose which Chinese firms are being considered, saying, "It might take a while" to hammer out a deal.
Arcelor may raise Dofasco offer via joint bid with Nucor
Arcelor SA may raise its offer to acquire Canadian steelmaker Dofasco Inc by filing a joint bid with Nucor according to an unsourced report in French daily Le Monde.
The new bid would be raised 'considerably' from Arcelor's current C$63 per share bid, in an attempt to win endorsement from Dofasco's management. Dofasco has said it prefers a rival C$63 bid from Thyssenkrupp AG, which runs until January 25.
Arcelor had already teamed up with Nucor last year to propose several takeover offers to Dofasco, most recently with a failed joint offer in November of C$52-55 per share. Nucor dropped out of the joint venture after Arcelor decided to pursue a hostile bid put directly to Dofasco's shareholders, launched on Nov 23 at C$56 per share.
An Arcelor spokesman refused to comment on the Le Monde report, saying only that the company continues to review its options in light of Thyssenkrupp's matched bid.
Australian mining region hit by cyclone Clare
Telephone and power lines were cut as tropical cyclone Clare slammed into remote mining communities in the northwest of Australia, officials said. Winds of up to 195 km an hour hit the town of Dampier today as the cyclone came ashore in the resource-rich Pilbara region, the weather bureau said.
BHP Billiton, Santos and Chevron closed down offshore oil rigs, and the closure of the ports at Dampier, Cape Lambert and Port Hedland stopped the flow of iron ore.
The Pilbara region, regularly hit by cyclones at this time of year, is home to offshore oil and gas operations as well as iron ore, salt and nickel mining.
BHP Billiton spokeswoman Ms Samantha Evans said the company's iron ore and mining operations were proceeding as usual but shipments could not get out.
Tangshan crosses 10 million marks in 2005
Tangshan Iron and Steel Corporation Ltd. in Hebei Province has announced an estimated steel output of 10.06 million tons for 2005, up 21% YOY to became the province's first steel maker with an annual output topping 10 million tons.
Its sales revenues reached 30 billion yuan ($3.7 billion) and pre-tax and net profits stood at 3.8 billion yuan 1.9 billion yuan respectively
Russian RZD seeks coal mine investors
Russia is seeking investors to develop a $2.2 billion coal mine in eastern Siberia, the nation's largest deposit, as part of plans to increase domestic coal supplies and boost exports to Asia. Russian Railways RZD, the country's rail monopoly plans to sell its 29.5% stake in the Elginskoye site, which holds about 2 billion cubic meters of coal, according to Mr Vyacheslav Shtyrov, president of the Sakha republic. The field is part of the Lensko-Tungussky coal region, the worlds largest by reserves.
Russia plans to accelerate development of east Siberian oil, gas coal and gold fields, most of which are based in Sakha. Forty percent of Sakha is within the Arctic Circle. Investors will mine 30 million tons per year of coking and energy coal at Elginskoye, of which about 20 million tons will be exported, Mr Shtyrov said.
Investors in the project will need to build a railroad from the field to link it with RZD's network to transport the fuel to the Pacific coast. They will also have to invest $140 million to build an export terminal at the port of Vanino in the Khabarovsk region, it said.
Metso to supply grate kiln system to LKAB in Sweden
Metso Minerals will supply a Grate Kiln system for iron ore palletizing to LKAB in Kiruna, Sweden. The value of the order is EUR 65 million. The estimated start-up of the operation is the first quarter of 2008.
The new system called KK4 will produce 6 million tons of iron ore pellets for steel making per year. The Metso Minerals delivery comprises a grate pre heater, rotary kiln, annular cooler and auxiliary equipment. The system will be used to indurate pellets for use in blast furnaces for the production of steel. When completed, the system will upgrade the palletizing capacity for LKAB at Kiruna by over 50%.
KK4 is part of LKAB's overall expansion of the mine and production facility in Kiruna. LKAB is the leading European producer of upgraded iron ore products for steelmaking. Headquartered in Lulea, Sweden, it had net sales of EUR 975 million in 2004, and it employs approximately 3,500 employees.
Metso is a global engineering and technology corporation with 2004 net sales of approximately EUR 4 billion. Its 22,000 employees in more than 50 countries serve customers in the pulp and paper industry, rock and minerals processing, the energy industry and selected other industries.
Taiwan's China Steel plans four year upgrade project
China Steel Corp, Taiwan's largest steelmaker, says it will invest more than 30 billion Taiwan dollars ($930 million) over four years to upgrade its facilities in the face of increasing competition. "With competition getting fiercer and fiercer, China Steel has to target a niche market. The company is planning investments to manufacture value-added products and upgrade production quality by 2010," company executive VP Mr LM Chung said.
The planned value-added items include reinforced and light-weight steel plates for auto manufacturing and other products for industrial motor use, Mr Chung told. The quality of hot rolled and cold rolled steel will also be improved, he added.
China Steel, some 23% held by the government, faces competition from petrochemical conglomerate Formosa Plastics Group which plans to build a 140 billion dollar steel mill with annual production of 7.5 million tonnes.
Current annual production of hot rolled steel totals eight million tonnes and cold rolled steel exceeds 3.3 million tonnes.
Stelco looking for new directors
Hamilton-based Stelco announced that three of the firm's new financiers, who will own the majority of the company if it successfully emerges from bankruptcy protection, plan to replace Mr Pratt as CEO. They have suggested they want him to remain involved with the company, replacing Mr Richard Drouin as chairman of the board, a role Mr Pratt said he's inclined to accept, adding he's not sure what his next career move will be.
Mr Pratt is known largely known for his labor-relations expertise and took the helm of Stelco at the beginning of January 2004. He quit as CEO of Toronto Hydro Corp. to take the job, having already sat on Stelco's board for 22 months.
Later this week, Stelco intends to announce a new sleight of directors chosen by its financiers, Mr Pratt said. Stelco's restructuring plan allows Tricap to choose four directors, and Sunrise Partners Ltd. Partnership and Appaloosa Management LP to each choose one. The remaining three directors have to be acceptable to all three financiers.
Tricap Management Ltd., a restructuring fund owned by Brookfield Asset Management, formerly called Brascan Corp, is pushing the changes. Tricap will own at least 34 of Stelco if its restructuring plan is implemented. Tricap is backed by two other firms that are also helping to bankroll Stelco Sunrise Partners LP and Appaloosa Management LP, which would own a combined Stelco stake of at least 34.9%.
Arcelor to sell Flachform Stahl to Salzgitter's Helmann & Lueg
Arcelor is to sell its steel service centre Flachform Stahl located in Schwerte Ruhr Germany to German steelmaker Salzgitter. Flachform Stahl will be integrated with the local Salzgitter subsidiary Helmann & Lueg. The transaction is subject to customary conditions and approvals, for instance by competition authorities. The price of the transaction was not disclosed.
This transaction allows Arcelor to optimize its Steel Service Centre network in Germany where it holds a number two position in this market. Arcelor will continue ton hire slitting toll processing in Schwerte.
The activities of both steel service centers are complementary, with Helmann & Lueg mainly active in the market for cut to length products while Flachform Stahl operates several slitting lines.
In Schwerte, Flachform Stahl has a capacity of about 250,000 tons annually, employing approximately 85 associates. Helmann & Lueg is to take over the staff as well as facilities and the equipment. The combination of both entities will lead to the creation of one of Germany's most attractive steel service centers with a wide product range and an annual capacity of approximately 500,000 tons. The move is to allow Helmann & Lueg to expand its offering in terms of products and services, deriving synergies thanks to the proximity of the two sites.
Hillman Acquires SteelWorks Cincinnati
The Hillman Companies Inc announced today that its Hillman Group Inc subsidiary purchased certain assets of The Steel Works Corporation a Denver Colorado based manufacturer and distributor of metal shapes, threaded rod and metal sheet to the Retail Hardware and Home Improvement Industry. Annual revenues of SteelWorks customer base are approximately $31 million.
Mr Max W Hillman Jr CEO of Hillman said the addition of the SteelWorks business will further complement Hillman's national presence in its core market segments and add a strong market brand name with "SteelWorks".
Hillman sells to hardware stores, home centers, pet suppliers, mass merchants, and other retail outlets principally in the US Canada, Mexico and South America. Their product line includes thousands of small parts such as fasteners and related hardware items, keys, key duplication systems, and identification items, such as tags, letters, numbers and signs. Services offered include design and installation of merchandising systems and maintenance of appropriate in-store inventory levels.
2005 a "doom year" for China's steel industry
2005 was a "doom year" for China's steel industry as the government was working to reduce overcapacity in the sector. The China Iron and Steel Industries Association said profit growth of the whole industry fell 52.2 percentage points in the first ten months of 2005, with a drop of 30 percentage points estimated for the full year.
Industry insiders said after three years of over speed development, China's steel sector is entering a stable growth period, and the myth of "fat profits" will be over. Iron and steel plants would grapple with each other in the market by increasing product varieties and improving quality and services.
Calibre wins BHPB Indonesian coal study
Engineering consultancy Calibre Projects has won a contract to conduct a feasibility study for BHP Billiton's $465 million Maruwai coal mine project in Indonesia. Calibre co-founder and MD Mr Jack Rowley told that the firm had received a letter of award to act as study manager for the project, in conjunction with Clough Ltd subsidiary Petrosea and Roberts & Schaefer.
Calibre, Petrosea and Roberts & Schaefer plan to undertake the feasibility study in order to progress to the engineering, procurement and construction management for the mine, located in Kalimantan, Indonesia. The project scope includes mine infrastructure, airport, coal handling plant, coal preparation plant, haul road, overland conveyor, stacking, reclaiming, blending, utilities, barge loading and port facilities.
The feasibility study is expected to be completed in December this year, when the EPCM phase of the project will begin, following BHP Billiton board approval.
Algoma Steel announces Court decision
Algoma Steel Inc released updated information respecting the Court's decision with respect to the date of the special meeting to consider the Paulson proposal, shipments in the fourth quarter, and the redemption of the 11% Notes.
The Ontario Superior Court of Justice has rejected an application by Paulson & Co. Inc to change the date for the meeting of Algoma's shareholders to consider the resolutions requisitioned by US based hedge-fund Paulson. The date of the meeting remains March 22. Paulson is seeking to replace the majority of Algoma's Board of Directors and have a new board consider substantial distributions of Algoma's capital.
Algoma's Board called a shareholders' meeting for March 22 in response to Paulson's requisition. The Algoma Board chose that date in order to allow time for Algoma to seek a ruling from the Canadian Revenue Agency clarifying the tax consequences to Algoma and its shareholders in the novel structure proposed by Paulson. Paulson had asked the Ontario Court to rule that the meeting be held February 22.
Algoma Steel Inc. is an integrated steel producer based in Sault Ste. Marie, Ontario. Revenues are derived primarily from the manufacture and sale of rolled steel products including hot and cold rolled steel and plate.
SeverCorr work on schedule
Company officials say excavation and other site work is progressing as expected at what will be the $880 million SeverCorr mill. "The big overview is on schedule," said Mr Mike Wagner, the company VP for sales and marketing.
"The weather has helped us tremendously; its been on our side and allowed us to stay on schedule. The site excavation is coming to a close and we're starting foundation work and digging holes," Mr Wagner said.
CEO Eddie Lehner said that the company expects to start producing steel by late 2007. The plant will turn scrap iron into as much as 1.5 million tons of high-grade steel a year.
Steel combination to focus on 4 biggest mills
THE consolidation in China's steel industry will center around the country's four largest players in order to enhance the sector's competitiveness and unity, Fitch Ratings said in a report. Mergers and acquisitions will be led by Shanghai Baosteel Group Corp, Beijing Shougang Co, Wuhan Iron and Steel Co in Hubei Province and Anshan Iron and Steel Group in northern Liaoning Province.
An abundant supply of raw materials, convenient transport and sufficient government support are the main reasons for the steelmakers to become bigger and stronger.
"The increase in raw material costs and weakened demand for steel products have caused margin pressure and created impetus for consolidation in China's steel sector," said Danny Chen, associate director in Fitch's corporate team, in the report. Consolidation is necessary for Chinese steelmakers to improve capacity utilization and efficiency, Fitch Ratings, one of the world's top three rating firms, said.
China's steel industry has already made tracks towards mergers and acquisitions to cut cost and increase profitability. Wuhan Iron and Steel, better known as Wisco in central China, merged with Liuzhou Iron and Steel in late December. Anshan Steel and Benxi Iron and Steel Group, the fifth largest steelmaker, combined in August.
The moves were in line with China's steel guidelines issued in July, encouraging steel mills to shore up profit through combination to take advantage of economies of scale. The industry guidelines say China will have two major steelmakers, each with an annual capacity of more than 30 million tons, and a few producers with a yearly output of 10 million tons by 2010, mainly through combination between existing steel firms.
Schnitzer Steel Q1 earnings, prices forecast
Schnitzer Steel Industries, Inc. reported Monday net income of $42 million for the fiscal 2006 first quarter ended November 30, 2005, including a gain of $34 million (after tax) related to the agreement between the Company and Hugo Neu for the termination of their joint ventures. Net income was reduced by a charge of $11 million relating to a reserve taken by the Company for the estimated amount to settle the ongoing SEC and Department of Justice investigations into the Company's past payment practices in Asia.
Commenting on 1Q results Mr John D Carter, President and CEO, said, "Overall, the Metals Recycling Business was impacted by a number of short term factors that reduced sales volume and margins. On the East Coast volume at our New England processing facilities was impacted by the scheduled shutdown of our Rhode Island shredder and low beginning inventory levels. Processing costs and margins in New England were also negatively impacted by the low volume of materials. In addition, overall selling prices for ferrous metal showed a modest decline from the fourth quarter as Asian export markets remained unsettled."
Average net ferrous sales price was $209 per long ton in 1Q 2006, compared with $211 per long ton in 4Q 2005. Although there continues to be good worldwide demand for scrap metal, export markets have been unsettled since the second half of 2005, and this condition continued into the first fiscal quarter of 2006.
ThyssenKrupp mails its offer for Dofasco at C$63
ThyssenKrupp AG announced today that the Notice of Variation and Extension increasing ThyssenKrupp's offer for Dofasco to C$63.00 per share and extending the expiry date to January 25, 2006, is being mailed today to Dofasco shareholders. ThyssenKrupp previously announced on Tuesday January 3, 2006, its increased offer price to C$63.00 per share and the new expiry date.
The Notice of Variation and Extension includes confirmation that the Dofasco Board continues to unanimously recommend to Dofasco shareholders that they accept the ThyssenKrupp offer. On January 6, 2006, Dofasco issued a press release announcing that the Board of Directors unanimously recommends that Dofasco shareholders accept the revised ThyssenKrupp offer and tender their shares to the offer prior to the expiry date of January 25, 2006. The Dofasco Board further recommended that Dofasco shareholders reject the Arcelor offer announced December 23, 2005, and to not deposit their shares to the Arcelor offer.
NLMK says UBS exercised Greenshoe raising $ 39.6 million
OJSC Novolipetsk Steel said UBS Ltd has exercised the over-allotment option over 2,730,750 global depositary shares granted as a result of an authorization given to it by Veft Enterprises Ltd.
In a statement Novolipetsk said the over-allotment exercised, in connection with the Russian steel group's global offering of 420 million shares, represents about 6.5% of the global offering and added none of the $39.6 million proceeds arising from its exercise will be received by the company.
The offer price of the GDSs was set at $14.50 per GDS, with each GDS representing 10 shares.
Minmetals Secures loan for Brazilian steel contract
China Minmetals Corp and a partner secured $236.5 million of loans for supply of a blast furnace, plant and coke oven to Brazil Gerdau SA Latin America's largest steelmaker. Minmetals and partner China Metallurgical Construction Group will provide the technology and send engineers to Brazil. BNP Paribas SA and Industrial & Commercial Bank of China are loan arrangers for the project. China Export & Credit Insurance Corp. is the insurer.
The agreement will enable Gerdau Acominas, a steel mill in Brazil's Minas Gerais state, to expand production by 50% to 4.5 million tons a year, the statement said.
This is the biggest export contract for metallurgical equipment and technology in China,'' said Mr He Liu, Minmetal's project manager. Minmetals beat Japan's Nippon Steel Corp. and others to win the equipment supply contract last April, and the company is also looking at similar projects in India and former Soviet Republics, He said.
Egypt's Suez Canal revenues hit all-time high in
Egypt's Suez Canal has earned $3.45 billion in 2005, hitting a record high. "Revenues from transit fees of the canal in 2005 hit $3.45 billion, an all-time high since it were first opened 136 years ago," Chairman of Suez Canal Authority Mr Ahmed Ali Fadel said. Revenues grew by 12.3% compared to 2004, when the canal collected $3 billion Mr Fadel added.
The report did not provide factors that have contributed to the increase, but Mr Fadel said last month that the rise was a result of high oil prices which made routes circumventing the canal much more expensive. He also said that booming world trade in raw materials, including iron ore and coal, contributed to the rise.
The 190-km canal, which connects the Mediterranean Sea and the Red Sea, is one of the busiest waterways in the world and one of Egypt's major revenue earners.
