January, 20 2006
ISA seeks hike in customs duty on steel
It is reported that a delegation of large domestic steel makers led by Indian Steel Alliance ISA met steel minister and demanded that customs duty be raised to 15% from existing 5%. The delegation cited that the move had become important as steel imports had shot up by nearly 100% in April-November 2005-06 to 2.42 million tonne.
In their presentation, the large steel producers had pointed out that landed price of imported steel was around $ 380 per tonne while domestic price was hovering around $ 395 per tonne giving a cushion of just 5%. If prices were to fall further, many of the profitable companies may start reporting losses, they said.
It is reported that steel ministry was studying the presentation made by the domestic steel players and if a need arose may revise its earlier pre-Budget recommendation to the finance ministry, which may not find favor with the finance ministry, which had earlier also expressed reservation over an increase in duty levels citing that steel imports were not causing any damage to the domestic industry. The commerce ministry had also rejected an earlier suggestion by the industry to institute anti-dumping proceedings against cheap steel imports from CIS countries.
Many economists and members of the downstream steel industry feel that if the government increased the customs duty, then it would be a retrograde step, which would show the government in a poor light and reflect its inconsistent policies.
Coal dept allots 6 blocks to NTPC
Department of coal has de-reserved four blocks originally meant for Coal India CIL and given them to National Thermal Power Corporation. Two other blocks, including a non CIL block and one identified for captive mining by core sector consumers, have also been allotted to NTPC.
The blocks awarded to NTPC will give it access to 5,602 m tonnes of coal. This amounts to 10 years of coal production by CIL at current rates. The de-reservation will help the power major pursue an annual production target of 50m tonnes, and CIL may chip in at later stages for a couple of projects.
VISA Steel marching ahead
With expansion plans round the anvil, VISA Steel Limited will tap the capital market with an issue of 3.5 crore shares. The premium for the shares of Rs 10 each will be decided through the book-building route. VISA Steel filed its Draft Red Herring Prospectus with SEBI on January 2, 2006. The issue proceeds would be utilized to partly finance the capital expenditure for its existing manufacturing facilities into an integrated 0.5 million ton per annum special and stainless steel plant. The plant will be fully operational by the end of December 2007.
VISA Steels operations are at Golagaon and at Jajpur in the Kalinganagar Industrial Complex in Orissa. The Company is currently operating a blast furnace with production capacity of 225,000 tonnes per annum of Pig Iron and a Chrome Ore beneficiation Plant and a Chrome Ore Grinding Plant with capacity of 100,000 tonnes per annum each.
As a part of its expansion plan VISA Steel would be spending Rs 1,400 crore in phases and has already spent around Rs 250 crore for the commissioning the blast furnace in a record time of 11 months and another Rs 160 crore will be spent on implementing the Coke Oven Plant. A 400,000 tonnes per annum Stamp Charged Heat Recovery Coke Oven Plant is currently under implementation with a unique Chinese Technology that will allow blending of semi soft coal with local coal thereby reducing import costs.
VISA Steels having the first movers advantage in the Kalinganagar Industrial Complex in Orissa, has adopted the latest technology to make them a low cost manufacturer of special and stainless steel. VISAs plan to implement the expansion in a modular fashion will also enable the company to leverage its finances in a systematic manner and also make each unit an independent one.
VISA Steels decision to forage into the special and stainless steel sector is based on the continuous upsurge of this segment in India. The automobile, auto component, infrastructure and engineering sectors will be the main demand drivers of special, stainless and alloy steel. With its aggressive outlook, VISA Steel is all set to march ahead in this sector.
POSCO may take CMPDI as consultants
A team of the mining division of POSCO visited Central Mine Planning and Design Institute CMPDI to explore the possibilities of using Indian coal for their proposed 12 million tonnes steel plant in the Paradeep of Orissa.
The 7 member team, led by Director of mining division Mr Jin Tae Moh, held discussion with Mr S Chaudhari CMD of CMPDI. CMPDI made detailed presentation about its capabilities and facilities in the field of exploration of coal, iron ore, mine planning, testing of coal and other minerals, and remote sensing.
POSCO expressed their intention to engage CMPDI as their consultant for logistic support in their effort to set up the steel plant.
Indian Steel Alliance asks for iron ore for domestic players
The Indian Steel Alliance ISA asked the Government to accept the recommendations of the RK Dang Committee on allocation of iron ore and chrome ore and warned that anything else would sound death knell for the domestic steel industry.
"We want the high-powered committee appointed by the Government and headed by Planning Commission Member Mr Anwarul Hoda to accept the recommendations of the Dang Committee in to-to or else any miscalculation could spell disaster for the Indian steel industry. We categorically want that priority should be given on allocation of captive mines to existing integrated central and state steel plants," ISA President, Mr Moosa Raza said.
He reiterated that export of graded ore Fe 62 per cent and above should be phased out in the next 25 to 30 years or else the Indian domestic steel utilities which are on an expansion spree would be choked within the next 20 years for want of ore.
Significantly, the Dang Committee had accorded lower level of priority for allocation of captive iron ore mines to foreign steel giants willing to set up their units in the country.
Mundra Ports throughput increases by 43% in 2005
The Adani Groups Mundra Port has registered a 43% growth in total cargo handling in calendar year 2005 over 2004. The Port handled 7.795 million tonnes of cargo in January to December 2005, as against 5.456 million tonnes in 2004. Out of this, dry cargo comprised 6.645 million tonnes
The Port management has credited this growth to the efforts put in by all "family members" of Gujarat Adani Port Ltd as well as its hi-tech, advanced and mechanized cargo handling systems. It added that with the Port planning to expand and augment infrastructure and facilities, it should touch even greater heights in cargo handling, the 43% growth being "just a beginning towards a larger dream".
Jharkhand Maoists planning to target coalmines
Maoist guerrillas in Jharkhand are planning to target coal projects by looting explosives there and taking cuts from officials working on mining projects, intelligence reports say. According to sources in the state intelligence, rebels have been extorting money from officials involved in coalmining.
"The CPI-Maoist is planning to target coalmining projects in the state. In the past, explosives meant for blasting mining areas have been looted by Maoist guerrillas," a police official said. "Most coal mining is taking place in Maoist-dominated areas. Explosives and other mining tools are very useful for Maoists." The guerrillas use the explosives to make landmines that target policemen.
Larsen & Toubro Q3 net up 95%
Indian construction major Larsen & Toubro Ltd reported increase in net profit after tax to Rs 259.27 crore for the quarter ended December 31, 2005 as compared to Rs 132.35 crore in the corresponding period in 2004-05.
The total income of the company has increased 14.23 per cent to Rs 3782.79 crore for the quarter ended December 31, 2005 from Rs 3311.47 crore in the year-ago period
Rishabh Digha Steel to double capacity
Mumbai based Rishabh Digha Steel & Allied Products Ltd is expanding its capacity almost by 50% from 10,000 tonne per month to 18,000 tonne per month at an investment of Rs 1 crore.
Rishabh Digha Steel has undertaken restructuring exercise at its Unit I and Unit II in Taloja Maharashtra for modernization of its existing processing facilities.
Global crude steel production up by 5.9% to reach 1.129 billion tonnes
World crude steel production increased by 5.9% in 2005 to reach a total of 1.129 billion tonnes according to the International Iron and Steel Institute IISI
China accounted for most of the increase as crude steel production in China rose by 69 million tonnes, up by 24.6%, to 349.4 million tonnes. Chinas share of the world total rose from 26.3% in 2004 to 30.9% in 2005.
India recorded 16.7% growth amounting to 5.5 million tonnes to reach 38.1 million tonnes in 2005.
Japans crude steel production of 112.5 million tonnes in 2005 was virtually unchanged from the previous years level.
Asias total output rose by 14.8% to 583.8 million tons, more than half of the world total. A consolidated North American steel industry reduced crude steel output by 7 million tonnes or 5.3% to 127 million tonnes. South Americas total output for the year was down by 1.2% at 45.3 million tonnes. Cutbacks by some producers reduced output in the EU (25) by 3.6%, to 186.5 million tonnes and production in the CIS held steady at 112.9 million tonnes.
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Rio boost iron ore production
RIO Tinto has reported a 16% jump in iron ore production for 2005 with two operations posting record output. Rio said that that the demand for the commodity remained strong from all markets throughout the year.
The Hamersley iron ore operation in Western Australia set a new record for both the December quarter of 22.44 million tonnes and the full year of 86.13 million tonnes. Record quarterly sales were also reported for Hamersley, where a mine expansion is underway, with sales up 15%77 on the previous quarter. Sales for the year from Hamersley were up 18% on 2004 and production was up 16% for the year.
Production from Robe River, also in WA, reached record levels with 7.36 million tonnes of iron ore in the December quarter, up 17% on the December quarter of 2004.
Wuhan Steel to cut costs in struggle for profits
Wuhan Iron and Steel (Group) Co WISCO, China's third-biggest steelmaker, plans to cut costs by 2.8 billion yuan ($347 million) this year as it and other Chinese steel companies struggle against falling sales prices. WISCO posted record sales and profit in 2005, but it faces challenges this year to maintain momentum amid a market surplus and dropping prices.
Wisco's sales reached 53.3 billion yuan last year, 20% higher than earlier projections. Profit was flat at 7.1 billion yuan, the firm said.
Rising raw material prices translated into a cost increase of 4 billion yuan for the company last year. Steelmakers are unable to pass on escalating raw material costs due to dropping street prices for their products. Steel prices began to fall last April, and analysts don't foresee much, if any, improvement this year.
WISCO plans to become one of Fortune Magazine's top 500 companies in five years, with a production capacity of 40 million tons of steel. Baosteel is now the only Chinese steelmaker in the ranking, listed in 309th place.
Siemens sees increasing sales in China's steel sector
Siemens I&S received RMB 7.4 billion ($925 million) in orders in China in 2005 and expects to increase sales especially in the steel sector in the next few years, Siemens China announced. Mr Hans Werner Linne GM of Siemens I&S China said the acquisition of VAI and the combination of two departments will help the company play a more significant role in the Chinese steel industry.
Mr Qin Zheng GM of the Metallurgy and Nonferrous Metals Department of Siemens I&S, said the company sees increasing sales volume in China especially from the fast developing steel sector over the next few years as the steel industry development policy includes the equipment standards for qualified steel mills and the elimination of outdated steel mills over the next few years.
Siemens major orders from China's steel sector include the automotive and driving system of Baosteel's pickling and cold rolling mill, WISCO's cold rolling mill, TISCO's stainless steel line and Anben Steel's new hot rolling mill.
Siemens I&S provide electric equipment, automatic facilities and technology solutions for steel production, water treatment and transportation controlling system. Through the acquisition of VAI, it is now able to provide more solutions for steel production.
Zinc rising as Peru miners start strike
Zinc rose to a record in London for a seventh consecutive day on concern that a strike at three mines in Peru may deepen a forecast shortfall in production. More than 750 Volcan Cia. Minera SA workers halted work at the Andaychagua and San Cristobal mines and Mahr Tunel concentrator plant at the Yauli mine, the mining federation's secretary-general Mr Luis Castillo said in an interview yesterday from Lima. The mines account for almost half of the company's output of zinc concentrate, a raw material used by smelters.
Zinc for delivery in three months on the London Metal Exchange rose as much as $14.50, or 0.7%, to $2,128 a metric ton. The contract was $1.50 higher at $2,120 as of 9:55AM in London.
Zinc rose 53% last year, the best- performing metal on the LME.
Pakistan steel sector considering steps to save domestic industry
Pakistans Planning Commission and the Central Board of Revenue have jointly proposed to the government seven measures to save the local steel industry from closure because of imports at lower prices.
A meeting of all stakeholders of the steel sector was held a few days ago at the Planning Commission, which reviewed the difficulties faced by the local steel industry due to imports of steel and closure of 22 units. Senior officials and representatives of the Planning Commission, CBR, Pakistan Steel Mills, Pakistan Steel Melters Association, Pakistan Steel Re-Rollers Association and Pakistan Ship Breakers Association attended the meeting.
The meeting took some important decision keeping in view information received from the private sector and decided to recommend these to the government for formal approval. According to the decisions of the meeting, 5% regulatory duty would be levied on the import of re-rollable scrap. The duty and valuation structure of imported billets would not be changed and wrong declaration of steel bars, structures, plates, slabs, etc in the garb of re-rollable scrap would be strictly checked at the import stage.
The import of rail track cutting scrap would be proposed to be banned or restricted either through change in the definition of re-rollable scrap in the Import Policy Order 2005, or through an out right ban.
Shipping rates for coal & ore fall to 5 month low
The cost of shipping commodities such as iron ore and coal fell to its lowest in more than five months because of a buildup of vessels available for hire in the Pacific and Atlantic Oceans. The Baltic Dry Index fell 45 points or 2% to 2169 points yesterday the lowest since August 15, according to London's Baltic Exchange. The index is heading for its second consecutive weekly decline.
Freight rates for the vessels moving cargo to China from Australia fell by 19 cents or 2.3% to $8.15 a metric ton, according to the Baltic Exchange. On the Brazil China route, shipping costs for capsizes fell 1.3% to $21.23 a ton.
Rates for the vessels transporting coal to the Netherlands from South Africa's Richards Bay fell 1.4% to $10.83 a ton, according to the Baltic Exchange.
It is becoming doubtful whether a significant increase in activity can be expected until Chinese New Year holidays are over and ore prices for 2006 have been agreed'' Oslo based shipbroker Fearnleys AS said in a report today.
Perus Aceros Arequipa awards additional upgrading to Danieli
Corporacion Aceros Arequipa SA awarded Danieli the order for the additional upgrading of its steelmaking, casting and rolling plant in Pisco, for further increasing its overall production capacity and for extending the final hot-rolled products sizes range.
Rolling mill capacity, presently of 300,000 tonnes per year with a product mix that includes up to 40 mm dia round bars, up to 50 mm angles and 5.5 to 16 mm wire rod in coils weighing 500 kg, will now be brought to 500,000 tonnes per year. The product range will be extended up to 100 mm dia rounds, 100 mm angles and correspondent channels and flat bars.
The installation of a new 70-t EAF, as well as a further implementation of the 4-strand continuous caster and FTP will enable to cope with the new operating conditions. Danieli will also supply a new 130-t casting crane. The rolling mill will be fed by a new 80-tph walking hearth reheating furnace designed for future connection to the continuous caster for hot-charging purposes. The rolling mill will be transformed into a fully-continuous arrangement through the installation of SHS housing less stands and auxiliary machinery.
All this will enable to exploit the wire rod line at its full design capacity, allowing production of up to 2-t coils. Danieli Automation will supply all electrical and an advanced process control and automation system for the whole mini mill upgrading. Startup of the upgraded Pisco mini mill is scheduled for spring 2007.
Previous upgrading steps carried out by Danieli at Pisco mini mill included the upgrading of a 40-t EAF, ladle furnace and continuous caster, a new fume treatment plant, the modernization of the rolling mill and its completion with a new high-speed wire rod line.
Global Ispat resumes production at Delta Steel after 10 years
Nigerian Delta Steel has resumed production since December 29, 2005 after about 10 years of inactivity and targets production of 800,000 tons by the end of this year. With this projection, the steel company aims to achieve 80% capacity utilization of the plant, which was built to produce 1 million tons of liquid steel per annum. Mr Lalit Sehgal MD of Global Infrastructure (Nigeria) Limited said that Delta Steel, located in Aladja Warri, which last experienced industrial activities in 1996, has started commercial production of liquid steel and billets production since December 29, 2005 under the new management led by him.
He added that The power plant is working good capacity utilization, the Oxygen plant is producing at over 100% capacity utilization and the lime plant is working at very good capacity utilization
Mr Sehgal also said Delta Steel will soon start exporting finished steel products from Nigeria, a feat that will put the country back on the steel map of the world.
TATA Steel scores points in Richards Bay pollution debate
Hexavalent chromium or chrome VI, the cancer causing element has got the residents of Richards Bay concerned as they believe that their seaside town already has too much air pollution and are thus resisting to allowing the construction of TATA Steel's R650 million ferrochrome plant in Richards Bay
However, according to a TATA spokesperson the pollution load in the air in Richards Bay is less than 50% of what is allowed in the regulations under the new Air Quality Control Act. The spokesperson said 98% of the pollution in Richards Bay was caused by four companies: Mondi, Foskor, Hillside and Bayside Aluminium. According to the building specifications, the emissions from the ferrochrome plant would contribute 0.01% to sulphur dioxide emissions. In the words of the Tata spokesperson: "We would be a flea on a camel's back."
The industrial development zone in this port town in northern KwaZulu-Natal has big plans. The IDZ is negotiating 21 projects worth R6.3 billion. But the work that has been put into luring these investments to the region is being stymied by the high levels of air pollution, particularly sulphur dioxide and particulate emissions, caused by existing businesses.
The Richards Bay Clean Air Association, an industry funded body of which local and provincial government as well as community organizations are members, has said: "No more dirty industry."
SCM to set up MetInvest to manage Ukrainian assets
System Capital Management, a Donetsk based large owner of Ukrainian mining and metallurgical assets, said it will establish MetInvest Company to manage the group's mining and metallurgical assets.
SCM said the company will be registered as MetInvest Ltd., in which SCM will own 80% of the statutory fund and MetInvest BV of the Netherlands will own 20%
Baogang may mine iron ore in Irkutsk region in Russia
Baotou Iron and Steel Group (Baogang) may develop an iron ore field containing an estimated 400 million tonnes of ore near Selenginsk in Russia's Irkutsk region.
Botou Mr Qiao Shi Ming, told press "an official from the Selenginsk municipal administration visited Baotou a few days ago and said he would like to see Baogang develop the field." "Given the reliable transport communications between the Irkutsk region and Inner Mongolia, where Baogang is located, our company has certain advantages over other Chinese rivals," he said.
Selenginsk lies along the Trans Mongolian Railway, which links Irkutsk and Beijing.
Ukrainian maintain scrap prices for February
Representatives of Ukrainian companies have agreed that operations with scrap ferrous metals in February will be carried out at the same prices as those of scrap metal in January, which are currently 850 hryvni per tonne. The decision to retain the current prices was made at a conference of representatives from the Ukrainian mining and metallurgical industry in Dnipropetrovsk on January 18
Mr Ivan Zaitsev, a representative for the Ukrainian Scrap Metals Association UAVtormet, said about 6.4 million tonnes of scrap metal were delivered to Ukrainian enterprises in 2005 which is about 530,000 tonnes per month on average. The largest deliveries came in April at 740,000 tonnes, while the lowest amount was in June at 382,000 tonnes
Mr Zaitsev appealed to Metallurgprom to set a scrap metal supply quota for the first half of this year.
Scrap metal resources are dwindling in Ukraine since no new equipment is being introduced and old pipes are not being replaced, he said. If the equipment were to be replaced, the older metal could then be used as scrap metal.
China's Steel Output to Rise JISF
Japan Iron and Steel Federation said that China will generate more steel products, despite measures to curb output and Chinese steelmakers will produce 385 million tons of crude steel, or 11% more than a year earlier. Chinas steel products will increase 12% to 409 million tons. The nation's restructuring of its steel industry will pick up, which should help slow the pace of output, the Japanese federation said.
China's excess capacity and overproduction of steel will have everything to do with supply and demand this year,'' Mr Akio Mimura, chairman of the Japan Iron & Steel Federation, told reporters
China is expected to consume 399 million tons of steel products this year, 7.3% more from 2005, on increased demand from manufacturers such as ship and car makers, the Japanese organization said.
Iranian HRC import into Pakistan reduces
Pakistani importers of HRC have stopped importing steel products as Iran has refused to reduce the prices despite declining trend in the international market, an importer said. They say that the current prices of Iranian steel products are not affordable to them as the prices in the international market have been reduced by some $30 per ton and currently tagged at $370 per ton. Iran is still charging $400 per ton.
Pakistans Trade with Iran started in January 2005, when Pakistani importers approached Iranian exporters and placed orders of HRC. "Before Iran, we used to import these products from European countries, Canada, Russia, Saudi Arabia, Ukraine and South Africa," said a leading importer, adding that now other players including China, Spain, France, Argentina, Brazil, Romania and Indonesia have entered this market as potential competitors.
"We are still interested in trade with Iran because its transit time is comparatively less than the transit time from the European countries," said another importer, adding that they would resume trade immediately, if Iran brought down its prices at par with the international market.
Vietnam to see major investments in steel in 2006
According to the Ministry of Industry, Viet Nam's steel-sector projects need VND15 trillion ($949.3 million) of investment this year. The projects include a smelter at the Thai Nguyen steel mill in the northern province of Thai Nguyen, and the Quy Xa iron ore joint venture in Lao Cai, both of which are expected to have an annual production capacity of 500,000 tonnes of steel ingots.
Other projects requiring investment are the Cuu Long Steel Ingot Mill, a steel and cast iron mill in the northern port city of Hai Phong, and the Samoa-Qing Dinh Stainless Steel Mill in the southern province of Ba Ria -Vung Tau.
Foreign-invested projects slated for next year include the $1 billion Tycoon Group metallurgical complex in the central province of Quang Ngai and the Sunteel Company Steel Mill in Ba Ria Vung Tau.
Viet Nam's current demand for steel stands at 2.8 million tons per year, 75 to 80% of which is imported.
Yemen to get first steel rolling mill in Mukala Yemen
It is learnt that a steel factory is to be built in Salab area in Al-Rayan 50 kilometers north east of Mukala in Hadramout governorate in Yemen at an estimated cost of $26 million, being funded by a number of Yemeni investors.
The erection of the factory will start in March 2006 and the mill would start production at the end of 2006. The factory will have a capacity of 120,000 tonnes initially but would reach 300,000 tonnes when the project is completed. The mill would mainly produce reinforcement bars for construction industry
Thai G Steel raises $61 million for expansion to 3.4 million tonnes
Thailand's G Steel PCL, a hot-rolled steel maker, has raised THB2.40 billion ($61 million) after its initial public offering shares were fully subscribed, a financial adviser source said. The IPO shares account for 15.5% of the company's post-IPO paid-up capital. Currently, the company has a total paid-up capital of THB8.2 billion.
The company expects to use the proceeds to expand its production capacity to 3.4 million tonnes per year, from 1.8 million tons per year currently.
Iron Ore mine to open in Zambia
A local mining company in Mumbwa is considering opening an iron ore mine at Nampundwe. Mumbwa District Commissioner Mr Alfred Sakala said Universal Mining and Chemicals Industries Company intend to set up a mine at Sanje hill and a processing factory in Kafue.
The District Commissioner said the Ministry of Local Government and Housing, the Environmental Council of Zambia and the Ministry of Mines and Mineral development have given the company a go ahead.
Technip and Hatch JV awarded Koniambo Nickel Project
Technip, in joint venture with Hatch, has been awarded by Falconbridge Limited the project for the construction of the Koniambo nickel smelter unit located in the New Caledonias Northern Province, near Kone. Koniambo is one of the worlds largest and highest-grade undeveloped nickel and laterite deposits. The planned smelter will have an annual production capacity of 60,000 tons of ferrous nickel alloy. Construction is scheduled to begin in 2007 with the earliest production start-up targeted for 2009-10.
The EPCM contract, valued at over $ 250 million, includes the engineering for the overall investment, as well as procurement and construction project management services. The engineering will be carried out by Technip and Hatchs engineering centers.
Facilities at this world-class nickel operation will include the laterite mine and ore-transport facilities, a pyro-metallurgical ore processing plant with associated utilities, a coal-fired power plant and other infrastructures. The overall investment in the Koniambo project will total about US$ 2.2 billion.
Mr Daniel Valot, Chairman and CEO for Technip stated,Technip is very proud to be part of the Koniambo project. We of course realize how important this project is for France and the New Caledonian people. We have worked with Hatch on this project for several years and believe we can deploy the best both companies can offer.
Mr Kurt A. Strobele, CEO for Hatch stated,Hatch sees Koniambo as a great opportunity for Falconbridge and we are proud to be part of it. Hatch clearly understands how important the development of this opportunity is for Falconbridge and the New Caledonian people".
Australia's Iluka 2005 sales up by 12.4%
Iluka Resources Ltd said that revenue from mineral sands and coal sales climbed 12.4% in 2005 to A$921 million, mainly due to higher sales of synthetic rutile, ilmenite, rutile and coal
Annual coal production from the Narama joint venture in the state of New South Wales rose 17.8% to 1.2 million tonnes in 2005, resulting from an agreement with Macquarie Power Generation to bring forward sales to meet demand. Iluka holds a 50% partnership in the Narama project, the other partner and operator being Xstrata PLC, the mining arm of Switzerland-based Glencore International AG.
Cade clears Arcelor to buy Previ & Petros shares in Acesita
Brazil's anti trust agency Cade has approved Arcelor's move to buy shares in stainless steel producer Acesita. A Cade spokesperson said "The process was approved unanimously and with no restrictions."
Two Brazilian pension funds Previ and Petros agreed in October 2005 to sell their shares in Acesita in a deal worth a total of 270 million reais ($116 million). The two held 25% of Acesita's voting capital.
The European steelmaker also said earlier this month that it was buying 4.05% of Acesita's capital from local pension fund Sistel for 136 million reais in a move that would make it Acesita's controller.
Arcelor told the Bovespa stock exchange last year that the Sistel purchase, in addition to the Previ and Petros transaction, would give it 76% of Acesita's common voting shares and 40% of its total capital.
Under Brazilian law, Arcelor has to launch a tender offer to buy the remaining common shares of Acesita for 80% of the average price paid to Previ, Petros and Sistel. In addition, Arcelor will launch a voluntary tender offer to acquire up to one third of Acesita's preference shares in circulation.
Belo Horizonte-based Acesita produces roughly 900,000t/y of liquid steel while Arcelor is the world's second largest steel company. Brazilian steelmakers Belgo-Mineira, CST and Vega do Sul are part of Brazilian steelmaking group Arcelor Brasil, a subsidiary of Arcelor.
Universal Stainless reports Q4 results
Universal Stainless & Alloy Products Inc reported today that sales for the fourth quarter of 2005 rose 14% to $42.0 million compared with $37.0 million in the same period of 2004. Fourth quarter 2005 net income rose 38% to $3.6 million. The Company's fourth quarter 2005 results exceeded its forecast of sales in the range of $33 to $38 million
For the full year 2005, sales rose 41% to a record $170.0 million compared with $120.6 million in 2004. Net income for 2005 increased 83% to a record $13.1 million
President and CEO Mr Mac McAninch commented: "Our very strong fourth quarter capped a record year for our Company. Our niche markets of aerospace, power generation, petrochemical and tool steel were robust all year and current indications are they will remain strong in 2006. Our cost recovery pricing strategy continued to be both effective for us and fair to our customers given the ongoing volatility of raw material costs and high energy prices."
Universal Stainless & Alloy Products Inc, headquartered in Bridgeville Pa., manufactures and markets a broad line of semi-finished and finished specialty steels, including stainless steel, tool steel and certain other alloyed steels. The Company's products are sold to rerollers, forgers, service centers, original equipment manufacturers and wire redrawers.
Gerdau Ameristeel announces Mr Mario Longhi as CEO
Gerdau Ameristeel announced that Mr Mario Longhi has assumed the additional position of CEO of the company. As previously announced, Mr Phillip E. Casey, will remain as the Chairman of the Board of the company. Mr Longhi assumes his duties as CEO following a distinguished international career of 23 years with the executive team of Alcoa, the recognized global benchmark in the aluminum industry.
Board Chairman Phillip E. Casey, commented, "Mario Longhi is a valuable addition to our management team and brings tremendous depth of international experience, proven leadership skills and dedication to the principals of continuous improvement. His dynamic leadership and valuable insight will help reinvigorate Gerdau Ameristeel and ensure successful management of the complexities and competitive challenges of today's global steel industry."
"During the coming months and years, our plan is to take the company to the next level," said Mr Mario Longhi, President and CEO of Gerdau Ameristeel. "We believe that an unrelenting focus on our customers, combined with strategic growth, will guide the actions of all of our people."
Gerdau Ameristeel is the second largest mini mill steel producer in North America with annual manufacturing capacity of over 8.4 million tons of mill finished steel products. Through its vertically integrated network of 15 mini mills including one 50%-owned mini mill, 16 scrap recycling facilities, and 42 downstream operations including two 50% owned joint ventures, Gerdau Ameristeel primarily serves customers in the eastern two-thirds of North America.
Ahmsa finalizes deal with Micare creditors
Mexican steelmaker Ahmsa has finalized an agreement with creditors to lift its coal mining subsidiary Micare out of its suspension of payment status, Ahmsa told the Mexico City bourse. The deal was accepted by a civil court and approved by 86 out of 102 official creditors, accounting for 92.7% of the total. No votes were recorded against the deal, the statement said.
Ahmsa said in the BMV statement that a court hearing will be held February 14 to issue a definitive ruling on the deal with creditors.
In 1999 Ahmsa received legal protection in Mexico and permission to continue operating under a form of bankruptcy protection for failing to pay $1.8 billion of debt, which included Micare's share. Micare then entered into a suspension of payment status for some $200 million in debt.
Micare operates two open-pit and three underground mines in Coahuila state, where it annually mines 5 to 8 million tonnes of thermal coal, which is used for power generation.
Monclova based Mexican steelmaker Ahmsa, controlled by the GAN group, produced 3.24 million tonnes of liquid steel in 2005, up 7.7% from 3.13 million tonnes in 2004
APS signs $1 billion coal deal with Peabody Energy
St Louis based Peabody said it plans to spend $90 million to develop its El Segundo coal mine in New Mexico to help meet the 65 million ton coal contract, which runs for 19 years. The mine will serve the APS Cholla Generating Station with more than 4 million tons of coal annually.
The company has all the major permits and expects development to begin in the fourth quarter of this year, with production scheduled for 2008.
Russia's Novorossiisk port closed on gale warning
Russia's main Black Sea oil export terminal of Novorossiisk was shut on Thursday because of strong winds and high sea swells, shipping sources said. The port was shut after a gale warning issued at 1130 local time Forecasts predicted winds of 13-18 meters per second in the morning, and as fast as 23 meters per second by the evening.
A gale warning is issued when the wind speed reaches 17 meters per second.
At the same time, the sea swell was expected to rise to 2-4 meters. "The worst part is the sea swell," a shipping source said. "Berthing and un-berthing is impossible."
Russian Coal gains control of Bor Mining-Chemical Co
Companies controlled by Russian Coal have gained control of the ZAO Bor Mining Chemical Company in Primorye, as per a report in local media. Bor is the only producer of high quality boron products from its own mineral resources in the CIS. The company mines and processes datolite ore, and makes chemical and boron products. Bor has design capacity to produce about 180,000 tonnes of boron products per year.
Bor was put into receivership in December 2003 following a petition filed by Alyans-Kapital, Bor's biggest creditor. Bor had debts of more than 317 million rubles at the time, and the assets slated for sale in the course of receivership were valued at 2.235 billion rubles. Receivership was completed in November 2005, when AO Bor was liquidated. ZAO Bor Mining-Chemical Company was set up with its assets.
This is Russian Coal's second deal involving assets in Primorye. Last March, the Russian Mining Co. won an open auction for the assets of Yaroslavsky GOK, a fluorite concentrate producer in Primorye.
KazTransGazto make China gas pipeline feasibility study in 2006
The feasibility study on construction of the Atasu-Alashankou gas pipeline from Kazakhstan to China will be carried out in 2006, Mr Serik Sultangaliyev the CEO of gas pipeline operator KazTransGaz, told a news conference. After the feasibility study is completed, gas delivery volumes will be estimated and the economics of the project evaluated.
The Atasu Alashankou oil pipeline was commissioned at the end of 2005.
It is a joint project of Kazakhstan's KazMunaiGaz and China's CNPC. The 988 kilometer pipeline has initial annual throughput capacity of 10 million tons, which may be boosted to 20 million tons.
BHP Billiton investigates financing grain shipment to Iraq
BHP Billiton said today it was extremely concerned about the references made to BHP in the Royal Commission into the UN Oil-For-Food Program. The company is working hard to clarify the facts as soon as possible.
BHP Billitons commitment to the highest standards of ethical conduct is a matter of public record. Our Guide to Business Conduct and our Charter outline our expectations in relation to the manner in which business is conducted.
BHP Billiton will provide the assistance required by the Commission and will continue to review the evidence that has been given and determine what, if any, steps need to be taken.
Mittal Steel increases Shareholding in Mittal Steel Zenica
Mittal Steel announced that it has acquired a further 41% stake in Mittal Steel Zenica from the Kuwaiti Investment Agency for US$98 million.
This follows the 51% of the Company (then BH Steel) acquired from the Government of the Federation of Bosnia-Herzegovina and the Kuwaiti Investment Agency in August 2004.
As a result of the transaction, Mittal Steel now has a 92% shareholding in Mittal Steel Zenica. The remaining 8% is held by the Government of the Federation of Bosnia-Herzegovina.
Blankenship to stay on at Massey Energy
Massey Energy Co has extended company president, chairman and CEO Mr Don Blankenships contract. The contract will now run till December 31, 2006. His original contract was set to expire on December 31, 2005.
Massey Energy is a Virginia based company is a major coking coal supplier. The company has mines in Kentucky, Virginia and West Virginia.
Ukraines industrial output may grow 9.5% in 2006
Ukrainian industrial output may increase 9.5% this year, compared with 3.1% last year, as domestic demand will increase, the Economy Ministry reported.
Ukraine's economy may expand 7% in all of 2006, if the country joins the World Trade Organization, the ministry said.
Residents object to UK Coals proposal for extending mining
It is reported that UK Coal wants to extract five million tonnes of coal from an area beneath 1,000 acres of land around the village of Great Heck near Selby over the next 12 years by extending the working area of Kellingley Colliery. Although there would be no surface development with coal being transferred underground for processing at Kellingley, the last active underground mine in North Yorkshire, there are fears about subsidence.
North Yorkshire County Council has received 19 letters of objection and a petition signed by 74 people. They are worried about subsidence, property devaluation, increased insurance premiums and a higher risk of flooding.
County council environmental services director Mr Mike Moore, who is recommending the planning committee to grant approval subject to conditions, said: "In the context of the overall scale of the permitted working area for Kellingley this is a proposal for a relatively small scale extension." Nevertheless, he accepts that there is potential for mining subsidence which could have adverse impacts.
AK Steel investing for large diameter SS tubing
AK Steel said that it will invest approximately $8.5 million at its wholly owned subsidiary, AK Tube LLC, to produce large diameter stainless tubing that will assist heavy truck manufacturers in meeting new standards for diesel emissions. AK Steel said the capital investment would include a resistance- weld tube mill, and associated equipment, capable of producing large-diameter stainless tubing to meet these new requirements. Construction of the new tubing mill will begin in the near future, with completion estimated by mid-2006.
The new US Environmental Protection Agency standards, which will become effective January 1, 2007, are designed to lower particulate matter and hydrocarbon emissions from heavy duty diesel engines, the staple of the truck transportation in the United States. Due to the significantly higher exhaust temperatures that will result from the new emission designs, diesel engine manufacturers have specified large diameter stainless tubing for many of the exhaust system components. Historically, those components have been manufactured using bare and aluminum-coated carbon steel tubing.
"AK Tube and AK Steel are already leaders in vehicle exhaust component steel technology," said Mr James L. Wainscott, president and CEO of AK Steel. "This new capital investment further enhances our industry-leading technology by helping us meet new market requirements for heavy duty truck exhaust components."
