January, 22 2006
JMM Chief Mr Soren expresses doubt over intention of investors
Jharkhand Mukti Morcha chief Mr Shibu Soren expressed doubt over the seriousness of the big steel-makers in setting up plants in Jharkhand, saying they were more interested in the state's rich iron ore. ''The industrialists proposing to set up plants here have their eyes fixed on the rich iron ore resources,'' Mr Soren told reporters here.
Reminding how a large number Mr Soren said displacement and rehabilitation policy were a serious issue and that already a large no of people, including had been displaced by earlier projects.
He said that Kalinganagar incident in Orissa happened because solution to very important questions If you throw out the people from their houses, where will they go? Who will give them jobs? What will be their fate? were not found by the Orissa government.
NORWAYs sale to Indian ship breakers off due to toxic materials
As per a report in French TV channel, Star Cruises have cancelled the recent sale of NORWAY to Indian scrappers. The reversal came from fears of potential legal action being taken against the company for breaking an agreement to not sell the asbestos laden ship for scrap when she was towed away from Bremerhaven last year.
NORWAY, inactive since a fatal boiler explosion in Miami killed eight crew members in 2003, remains at anchor off Port Klang, Malaysia.
Various environmental groups have recently put pressure on European nations for selling toxic ships to Asian ship breakers where standards are more relaxed. There are further reports that suggest the Malaysian Government has been investigating the sale.
Land oustees paralyze coal production in MCL mines
Coal production and transportation came to a grinding halt for the second day today following the economic blockade by the land oustees of Mahanadi Coalfield Limited in Belpahar and Lakhanpur area under Jharsuguda district.
Hundreds of displaced people have stopped the production and transportation of coal from three MCL mines demanding better compensation package for the land acquired from them by MCL and job to the displaced members.
Koila Kshyatigrasta Anchalika Sangram Samity President Narayan Mahapatra claimed that the coal exploration has been totally stopped in four mines, including Samaleswari mines, from today.
Daily wage staff in KIOCL to be included in special package
The daily wage employees working at Kudremukh Iron Ore Company Limited should be given suitable relief under Kudremuk special package scheme and a share in the profits earned by the company, urged Save Tunga Bhadra Agitation Committee president Mr Kalkuli Vittal Hegde. He said farmers and workers were two eyes to the Forum. Both farmers and workers should be given due justice. The permanent employees should be given PF and other benefits, he added.
The forum has organised Jagruthi Samavesha in Shimoga on Jan 22 for demanding justice to KIOCL workers. In the meeting, the forum would discuss on demanding the government for alternative arrangement to the workers and rebuilding of destroyed environment.
About 79 local farmers in Kudremukh area had given their land to KIOCL. Now they should be given suitable agricultural land and other benefits. Malleshwara near Kudremukh had to be rehabilitated by starting a educational centre and a fully equipped hospital, Mr Hegde demanded. A protecting wall across the mine of Aroli hillock, where the river Bhadra originates should be built. If it were not done the silt of the hillock fall into the river and the river would die, Mr Hegde said.
The government should not give permission for restarting mining in Kudremukh region, demanded seer Jayamruthyanjaya swamiji of Virakt mutt.
Seminar on CR technology in Bokaro
MD of Bokaro Steel plant inaugurated an international conference on Cold rolling technology process and systems, which began at the training and development centre auditorium of Bokaro Steel Plant.
More than 200 experts from India, Austria and Germany will be present in the two-day long seminar.
L&T to buy raw materials from China
Larsen & Toubro will source raw materials like plastic, steel and copper worth Rs 800-1,000 crore from China, reports Business Standard.
At present, the company sources its raw materials from within the country. However, with the rise in the cost of plastic and metal prices in the domestic market, L&T is looking at cheaper bases outside the country for raw material sourcing, according to sources.
Ontario Superior Court judge approves Stelco's restructuring plan
Ontario Superior Court Justice James Farley, who has presided over Stelco Inc.'s two-year bankruptcy protection process, has approved the steel maker's restructuring plan, propelling the Hamilton-based company toward a fresh start.
A group of shareholders, including Toronto investment firm Pollitt & Co. and AGF Management Ltd., had asked Farley to delay approving the plan for 30 days while they tried to find a buyer for Stelco.
His approval of the plan came after Stelco produced term sheets on Friday for $975-million worth of loans. One of the sheets was signed by Tricap Management Ltd., a restructuring fund owned by Brookfield Asset Management. A syndicate of lenders is setting up an additional $600-million asset-based loan, and the province of Ontario is loaning Stelco $150 million.
In his lengthy hand-written ruling, Farley acknowledged that Stelco's current shareholders will be wiped out under the plan, as their shares are eliminated and new equity is created. However, he said their efforts to find a buyer so far appear to have been rebuffed. "No one has shown any real or realistic interest in Stelco," the judge wrote, adding that "certainly Stelco is not Dofasco."
"This is wonderful news for Stelco, for our employees and retirees, for our other stakeholders, and for the communities in which we operate," company president and CEO Mr Courtney Pratt said in a statement. "The new Stelco that emerges from this process will be much better positioned to become a viable and competitive steel producer for the long term."
It has also proposed reorganization for Stelco Tricap's reorganization will divide the company into six key subsidiaries, which will each run under their own management. That move will separate Stelco's two core steelmaking operations - its older, high-cost plant in Hamilton, and its newer plant in Nanticoke, Ont.
Some employee groups have expressed concern that the changes would make it easier for Tricap to sell or close the Hamilton operations. Tricap said the changes will make it easier for Stelco to raise capital, and increase accountability for results at each business unit.
Ukraines steel export down by 3.8% in 2005
Ukraine exported 25.6 million tonnes of rolled steel products in 2005, 3.8% less than in the previous year, according to preliminary figures, the head of state company Ukrpromvneshekspertiza Mr Vladimir Vlasyuk said at a mining and metals industry conference. However, sales of rolled products on the domestic market grew 8.7% to 7.5 million tonnes, he said.
Steel exports to China tumbled 64% last year, as Ukrainian companies were pushed out of that market, and exports to Southeast Asia dropped 44%. However, exports increased to Africa, the Middle East, India and Pakistan.
Mr Vlasyuk said the situation with steel exports would remain tense in 2006 due to growing production in China and tougher competition as supply is expected to exceed demand.
Mr Vlasyuk also said the "time of high steel prices has passed." Prices for square billets will be at $280-$300 per tonne in 2006, and are expected to drop in the summer, he said. Prices for rebar and coil are forecasted at $320-$350 and $320-$340 per tonne, respectively. The price of iron ore commodities is expected to increase by up to 5% on the back of stronger demand from China. Mr Vlasyuk predicted coke prices would drop by 15-20%, while the price for scrap metal would be $168-$172 per tonne.
Coal mine flooding traps 9 in Guizhou
At least nine miners were trapped in the Yi Hui and Miao Autonomous County of Weining, southwest China's Guizhou Province, since two connected coal mines there were flooded on Thursday night.
Information from Guizhou Provincial Work Safety Bureau said the flooding happened around 7 PM on Thursday at two unlicensed coal mines, Anleixing and Gutaibai, both of which share part of the mining shaft, when miners of Gutaibai Coal Mine working beneath the shaft dug through a water logged area.
Both coal mines, situated in Huahongping Village of Tujie Township in the far-flung Weining County, western Guizhou Province, were flooded, and two miners from Gutaibai and seven more from Anleixing Coal Mine were verified to have been trapped beneath the shaft.
Rescue operation has been going on.
2 biggest Russian steel mills Evraz and MMK increase output in 2005
Steel output at Evraz increased by 1.2% in 2005 up to 13.85 million tons. The rolled metal production raised 0.6% to reach 12.23 million tonnes cast iron production slipped 0.9% to 11.46 million tons. Evraz is one of the largest vertically integrated steel and mining businesses in the Russian Federation. The company produced 13.7 million tons of crude steel in 2004 and sold 13.1 million tons of rolled steel products in 2004, making it the largest producer of steel and steel products in Russia, the largest Russian producer of long products and among the 15 largest producers of crude steel in the world.
Magnitogorsk Iron & Steel Works MMKs production increased by 0.7% in 2005. MMK produced 11.38 million tons of steel in 2005 as compared to 11.3 million tons in 2004 although the production of rolled steel at 10.2 million in 2005 was down by 9.4%.
Chinese power producers set for thermal coal price rise
Chinese power producers may have to pay as much as 8% cent more for their coal in 2006, a third year of record prices, after buyers and sellers were allowed to negotiate and set contract prices. The National Development and Reform Commission, the country's top economic planner, on December 27 removed a limit on the price of coal, allowing buyers and sellers to set annual contract prices. The commission in August last year limited fluctuations in the price to 8% higher or lower than a benchmark rate.
Coal prices in China, the world's biggest consumer and producer of the fuel, increased in late 2004 because of rising power demand. Transportation bottlenecks in the rail network in 2004 prevented efficient delivery of coal and bolstered prices, increasing costs for the nation's electricity generators and led to power shortages.
Producers were asking for an average increase of 20 yuan ($2.50) a tonne for this year's supplies as the government removed a limit on prices, Mr Xie Juchen, head of Zhong Neng Power Industry Fuel Co said in Beijing. "Power companies can't pass on higher costs of coal as quickly and are reluctant to agree to higher prices," Mr Xie said. "They are still holding out for steady prices this year to keep profitability after fuel prices surged." Mr Xies company buys coal for about half of China's power plants.
Coal suppliers and buyers are continuing talks for annual supplies next week after failing to reach price agreements during 10 days of talks held from January 1 to January 10 in the eastern city of Jinan in Shandong Province. The companies are "hopeful" of reaching final agreements on prices after the week long Lunar New Year holidays, Mr Xie said. Power companies may sign for about 600 million tons of coal under annual contracts this year, he said.
China's week long Lunar New Year holiday begins January 29.
Bodies of two miners found in WV coalmine accident
Rescuers on Saturday found the bodies of two miners who disappeared after a conveyor belt caught fire deep inside a coal mine. The bodies were found in an area of the mine where rescue teams had been battling the intense blaze for more than 40 hours. Rescuers could not enter that portion of the mine until the flames had been mostly extinguished and the tunnels cooled down.
The miners were lost on Thursday evening as their 12 member crew tried to escape a conveyor belt fire at Aracoma Coal's Alma No. 1 mine in Melville, about 60 miles southwest of Charleston. The rest of the crew and nine other miners working in a different section of the mine escaped unharmed.
Conveyor belt fires can occur when belt rollers get stuck or out of alignment and rub against the structure supporting them, said Mr John Langton, MSHA's deputy administrator for coal mine safety and health. Another possible cause is the accumulation of coal dust.
Massey opened the mine in 1999, and these are its first fatalities. The company released a statement Saturday, saying it was saddened by the miners' deaths and that the company will now focus on comforting the families.
Chinese ship building plates a boon to S Korean shipbuilders
Alarm bells are ringing for Korean steelmakers this year, as their biggest customers, shipbuilders and carmakers, are turning their eyes to cheaper supply sources in China. Two of the worlds leading shipbuilders Hyundai Heavy Industries and Samsung Heavy Industries are planning to import more steel plates from China this year, to become less dependent on Korean and Japanese makers. Currently, imported steel plates from China are being sold at around 10% less than products from Korean makers POSCO and Dongkuk Steel.
As a preparatory action to retain their market portions South Korean steel makers cut the price last month. Dongkuk lowered its ship plates price from 685,000 won per ton to 635,000 won last month. POSCO also set their price at 615,000 won, down from 645,000 won last month.
Last year, Hyundai depended for 55% of its steel need on the POSCO and Dongkuk Steel. Another 35% was imported from Japan despite the relatively high price. Only 15% was brought from other countries including China which Hyundai intends to expand on this year with the deal with Qinhuangdao Shouqin
Samsung Heavy Industries has also been negotiating with another Chinese maker BaoSteel. According to a Xinhua News Agency, Baosteel will supply 100,000 tons of shipbuilding steel sheets this year to Samsung.
The increasing import of Chinese steel has symbolic meaning, Dongkuks public relations manager Mr Kim Sun-hong said. Though the Chinese makers are not likely to make a big dent in our sales soon, it will certainly have some effect in the market and we are preparing for the change.
POSCO is a bit more optimistic than Dongkuk. But also admits that it will have tougher competition this year. Basically, the price of the steel products is decided by supply and the demand in the market. We cannot keep the price high when others are selling their products cheap. We have to meet the customers expectations, POSCOs public relations manager Mr Lee Sung-chul said. By lowering the price, we want to benefit our customers in return for their continued purchase of our products over the last few years despite the high steel price.
QASCO set for major expansion
Qatar Steel Company QASCO is all set for major expansion of its operations with the commissioning of a furnace in May this year and another with a production capacity of 500,000 tonnes by the end of this year. The expansion involves the installation of a new 1.5 million tonnes per annum DRI plant, a new 0.7 million tonnes per annum rolling mill and a 0.6 million tonnes per annum melt shop.
Mr Yousef Qassim Al Emadi, Production Manager of QASCO said that the new DRI plant would boost QASCOs DRI capacity to 2.3 million tonnes per annum. QASCO would also achieve a production of 1.5 million tonnes per annum of molten steel with the new furnace and the rolling mill capacity will also exceed 1.5 million tonnes per annum with the addition of a rolling mill.
Mittal Steel US reorganizes Eastern & Western operations
Mr John Mang, who has served as executive VP of the Western Region for Mittal Steel USA, has resigned from the company and leaves his post today. Mittal Steel has not given any explanation for Mr Mang's departure, except to say he "will be taking some well-earned time off and is considering a very broad range of career options."
Mittal Steel US is changing its organizational structure to have one person overseeing both the Eastern and Western regions and Mr William Brake Jr will assume the new position as VP operations. Mr Brake has served as executive VP of the company's Eastern Region since April, when Mittal Steel purchased International Steel Group Inc.
"Bills appointment to this new position also reflects a change in our organization structure," said Mittal Steel US CEO Mr Lou Schorsch in an internal memo distributed Thursday. "I am confident that this integration of all operations under a single individual will be a very positive step for our company."
Mr Paul Gipson, president of USW Local 6787 at Mittal's Burns Harbor plant, also said that Mr Mang's leaving comes without warning. "Mittal Steel is losing a valuable asset," he said. "We'll miss him as a person. He brought a different climate to the industry. He understands what the union's about. He understood us and respected us."
Chinas Hebei provinces export to Taiwan surge in 2005
The trade volume between north China's Hebei Province and Taiwan surged by 12.9% YOY to reach $750 million during 2005, the latest customs statistics have shown.
Hebei exported $430 million worth of coal to Taiwan last year, accounting for 70% of its total exports according to the Customs of Shijiazhuang, the provincial capital.
Hebei's rolled steel exports to Taiwan also increased by 3.7 fold YOY.
Italy warns of dumping in Steel
The minister for productive activities, Mr Claudio Scajola, warned that low-cost shoes and steel products imported from other countries are posing a threat to the Italian footwear and steel industries.
"We expressed our concern about what we consider a form of dumping in the footwear and steel sectors" Mr Scajola said at the end of today's meeting with EU Commissioner Mr Peter Mandelson.
Iran to remain a major player in MEA steel production
The Middle East, in 2005, witnessed 39.5 million tons raw steel production and it is estimated that 2007 and 2010 would see 51.5 and 62.5 million figures respectively.
For instance, the Saudis are in the process of completing largest direct reduction system plant in the world by 2007 which will also hold a midrex, direct reduction, unit with annual production of 1.76 million tons.
Turkey and Oman, not wanting to fall behind, have one 1.5-million midrex unit each underway, and Danieli of Italy has already inked a MoU to build a $550m steel complex in Abu Dhabi producing 2 million tons of steel.
Iran seems to be in good shape in this market, and further attention to private sector production could keep the country atop for the years to come. Nevertheless, investment in steel sector is soaring up and according to projection made by Metal Bulletin Research Group, the country would reach 18.5 million tons raw steel production by 2010.
US steel firms face import threats
Korean and Japanese steel imports may soon threaten US steel companies. The US Department of Commerce recently warned that companies like Steel of West Virginia could be hard hit by those imports.
Mr Tim Duke, chief executive officer of Steel of West Virginia, said Friday, "Five years ago, the International Trade Commission ruled Japan and Korea were dumping steel into this country. The five-year time frame is expiring and we want it reinstated. "The U.S. is a dumping ground for all kinds of products, not just steel. Many of these products come over here at such a low cost that we could not compete even if we paid our laborers nothing," Duke said.
Sen. Jay Rockefeller, D-W.Va., is asking the International Trade Commission to renew tariffs on government-subsidized structural steel beams that are "illegal imports" from those two countries. Mr Rockefeller said, "This is a pivotal time in the life of West Virginia's steel beam industry. Companies like Steel of West Virginia have made great strides over the last few years, in part because the ITC correctly imposed these tariffs by using the legal tools available to it. "Now that they've regained their footing, the last thing in the world they should have to deal with is having these tariffs lifted. That would mean a deluge of imports coming on the market."
In a Jan. 12 letter to ITC Chairman Mr Stephen Koplan, Sen Rockefeller wrote, "With increased [steel] production in China coupled with decreased demand in that country and around the world, we risk yet another glut of overcapacity, resulting in a significant increase in dumping in the US market. "The only way Japanese and Korean producers can compete in the U.S. market is to sell their goods at below market, and at times below cost, prices," Rockefeller wrote.
Steel of West Virginia is a sister company to Roanoke Electric Steel Corp., based in Roanoke, Va., and is in the process of merging with Steel Dynamics, a company based in Fort Wayne, Ind. Steel Dynamics employs 1,400 workers at six steelmaking facilities in Indiana and recently opened a new plant in Lake City, Fla.
SteelFab to open on January 22nd
The second edition of SteelFab, which is Middle East's exclusive and most established trade platform for manufacturers and distributors of machine tools, machinery, consumables and other items related to the steel working business, will open at Expo Centre Sharjah on January 22nd, 2006. The three-day event will feature 212 brands and companies from 29 countries.
SteelFab has already established itself as the Middle East's largest display of Steel, Fasteners, Accessories, Surface Preparation, Machinery and Tools, Welding and Cutting, Finishing and Testing equipment, and Coatings and Anti-Corrosion material, said Mr. Fasahat Ali Khan, Acting Director General, Expo Centre Sharjah.
SteelFab is organised by Expo Centre Sharjah with the support of the Sharjah Chamber of Commerce and Industry.
Stelco announces filing of 48th Monitor's Report
Stelco Inc announced that the Forty-Eighth Report of the Monitor in the matter of the Company's Court-supervised restructuring has been filed. The Report provides updating information on previously disclosed developments of recent days. The Monitor expresses the view that there has been considerable progress in resolving issues this week.
These issues include:
Term sheets: The Report notes that the finalization of the $600 million asset based loan and the $375 million bridge loan are conditions precedent to the implementation of the restructuring plan and are critical components of the liquidity and financing contemplated for the restructured Stelco.
Conditions precedent: The Report notes that the term sheets contain certain conditions precedent to the implementation of the financings, which the Monitor notes is not unusual for exit financing at this stage of a major CCAA restructuring. The Report adds that the parties to the loan facilities have indicated to the Monitor that they are committed to working to fulfill those conditions precedent. The Report notes that the parties to the asset based loan have indicated to the Monitor that they have reached sufficient consensus between themselves and with the Province.
Outlook: The Report states that, as is typical in restructurings of this size and complexity, there is significant work to be done to settle definitive documentation and to implement the contemplated transactions. The Monitor states that it is optimistic that the transactions contemplated by the term sheets can be implemented.
Board composition: The Report notes that the Monitor has been in discussion with counsel for the Informal Committee of Senior Bondholders regarding the composition of the new board of directors. The Report adds that the bondholders have proposed that Mr. Dennis Belcher be appointed to the new board in lieu of the vacant spot currently designated for Stelco's next chief executive officer. The Report notes that the three significant equity holders and the Company have agreed to this change, and that Mr. Belcher is prepared to stand as a director of the board on plan implementation.
Swazi Prince's company in race for iron ore mine
Last week, The Swazi Observer carried a story where Canham Mining International resident directors cried foul that there were senior people, both by their birth right and status, who were hijacking their intended investment to plough several billions of Emalangeni into the Iron Ore and Thermal Power generation projects at Ngwenya.
Both the Enterprise and Employment Minister Mr Lutfo Dlamini and Swaziland Investment Promotion Authority GM Mr Bheki Dlamini condemned the alleged plot. Prince Guduza is outraged that his company could be linked to such unethical conduct and described comments of stealing and hijacking to be criminal.
The Prince confirmed that his company is a contender for the project, as they have, through following legal requirements, submitted their application for a lease and mining license at the defunct mine. "There is a lot that one can say on this issue, but for now I would advise that you contact the relevant bodies dealing with mining issues. I am surprised at these allegations and the comments have been unfortunate in that they suggest that a Prince is barred from bidding for such projects. He said.
He said at this stage, their tender and that of Canham were still under consideration.
