May, 21 2006
Vizag Steel Plants expansion kicked off
Indian Prime Minister Dr Manmohan Singh on Saturday laid the foundation stone for the expansion of the Rashtriya Ispat Nigam Ltds Visakhapatnam Steel Plant in Vizag. Dr Singh said the massive investment for the expansion showed the government's commitment to make the VSP a truly world class steel plant.
The expansion, being taken up at a cost of Rs.86.92 billion, will be completed by October 2008 and is expected to increase the VSP's capacity from the present 3.6 million tonnes to 6.3 million tonnes.
VSP, the first shore based steel plant in the country commissioned in 1992 at a cost of Rs. 90 billion, had seen its net worth eroded by half by the accumulated losses in 1998-99. It, however, wiped out all the accumulated losses and became a debt-free company last year. The company now has cash reserves of over Rs.50 billion at present.
TATA Steel set to win over Kalinga Nagar tribals
TATA Steel has embarked on an exercise to win over the tribal people after facing stiff resistance from tribals of Kalinga Nagar, which witnessed police firing on January 2nd, and has delayed the start of project. Under the initiative, the rehabilitation and resettlement programs as envisaged by the Government policy will be implemented in consultation with the villagers, taking care of community living, socio cultural and religious concerns.
TATAs team, which consists of seven tribals, has been holding talks with the affected villagers. They are being explained about the R&R package and its benefits and how the steel plant project would usher in prosperity for them.
TATA Steel will also facilitate building houses for the affected families by utilizing their house building assistance. It has also developed special programs for the women and youth, including various traditional income generation modes. The company will provide facilities for education, drinking water, electrification, health and hygiene, burial ground, open spaces for cultural and religious activities and other key infrastructural necessities for the affected villagers in the new resettlement colony.
All of the families displaced by its plant at Kalinga Nagar would be called TATA Steel Parivar. TATA has not offered to provide comprehensive support for their socio economic progress and also monitor it for a period of five years. Each of the families will enjoy long term support in different sectors for being a part of the bigger Tata Steel Family and will be given special identity cards
Indian PM calls for investment in steel sector
Indian Prime Minister Dr Manmohan Singh, while addressing the foundation the stone laying ceremony for the expansion of the Visakhapatnam Steel Plant said though India had vast iron ore reserves, the country could not somehow become a major steel producer and called for private and foreign investment in tandem with the public sector in the steel sector to make the country one of the leading producers in the world.
Dr Singh called for improving the efficiency of public sector units and more investment in private sector to achieve 100 million tones steel production target by 2020.
Dr Singh said that he had urged Mr LN Mittal to come back to India and strengthen the steel industry here.
RINL granted Mini Ratan status
Indian steel minister Mr Ram Vilas Paswan while addressing the foundation the stone laying ceremony for the expansion of the Visakhapatnam Steel Plant said conferred Mini Ratna status to the plant. He said The move will give more financial and administrative autonomy to the company enabling it to take fast decisions for the expansion.
The minister also announced an ex gratia payment of Rs.5000 to each of the plant's employees in recognition of their hard work for the remarkable turnaround.
TATA Steel awarded PM's trophy for 2001-2002
TATA Steel has been awarded the Best Integrated Steel Plant in India for the year 2001-2002, making the company a five time recipient of the award. Prime Minister Dr Manmohan Singh presented the award to Dr T Mukherjee deputy MD of TATA Steel and Mr Raghunath Pandey of TATA Workers Union at the RINL plant in Visakhapatnam on Saturday.
The award includes a trophy and a cash award of Rs one crore. The trophy recognizes outstanding performance of the integrated steel plants.
Andhra Pradesh CM opposes SAIL & RINL merger
Andhra Pradesh Chief Minister YS Rajasekhara Reddy during the foundation laying ceremony for the expansion of the Visakhapatnam Steel Plant urged Dr Manmohan Singh not to merge the VSP with the Steel Authority of India Limited. He said that such a move would do great injustice to the region.
The chief minister was referring to the union steel ministrys proposal aimed at solving the shortage of raw material. The VSP employees .
Mukand posts record results for 2005-06
Leading specialty and alloy steel major, Mukand Limited, has recorded a phenomenal 538% rise in its profit before exceptional items and tax at Rs 86.03 crore for 2005-06 as compared to Rs 13.48 crore in 2004-05.The turnover increased to Rs 1,801 crore from Rs 1,673 crore in 2004-05. Profit after tax, excluding exceptional items, rose by a whopping 476% at Rs 74.79 crore as against Rs 13.32 crore in 2004-05. Mukund attributed the improved performance to concerted efforts to maximize production of higher value-added products as well as cost cutting and improved efficiency in the operations of the steel and industrial machinery business.
The turnover of the steel division increased by 7% to Rs 1,524 crore from Rs 1,424 crore on account of higher sales of alloy steels to the automotive sector. Revenues from industrial machinery division also went up by 58% to Rs 146 crore as an outcome of rapid expansion and investments for additional capacities in the engineering and steel sectors.
Mr Rajesh Shah MD of Mukand said "We expect to take industrial machinery business turnover to Rs 450 crore from the current level of Rs 150 crore over two to three years. Our strength in the industrial machinery business is our design capability and reliability of our products.''
Mukand Ltd would focus on both its specialty steel as well as industrial machinery businesses during the current fiscal. Specialty steel business accounts for around 80% of the company's turnover.
Maoists attack vital installations in Chhattisgarh
The Maoists on Saturday attacked important installations in Dantewada district of Chhattisgarh, including that of Railways, National Mineral Development Corporation and ESSAR and left pamphlets saying it were done so that these institutions will not function tomorrow and Monday during the two days Dandakaranya bandh call of the naxalites.
Naxalites damaged a drilling machine of the National Mineral Development Corporation in Akashnagar area of Dantewada district. In another incident the Maoists removed a steel plate on railway tracks, causing derailment of seven wagons of an iron ore laden goods train between Kamlur and Bhansi railway stations. Maoists also attacked the security guards of Essar steels iron ore plant in Kirandul area of Dantewada district.
India to invest $40 billion in nuclear reactors
Nuclear Power Corp of India Chairman Mr SK Jain said that to meet rising energy demand India may invest $40 billions to commission 25 to 28 reactors by 2020. Mr Jain said We are very confident the deal and all the agreements will go through. As an outcome of that, India will have access to the global nuclear technology market.
Nuclear Power Corp has held initial talks with Areva, the worlds biggest builder of nuclear power stations, Electricite de France, General Electric, Westinghouse and the Russian government, Mr Jain said.
US President Mr George W Bush is seeking an end to the 3 decade old international ban on nuclear technology sales to India, prompted by its atomic bomb test in 1974. Mr Bush has asked Congress to end the USs nuclear sanctions against India. The US and other members of the so-called Nuclear Suppliers Group, including France, Russia, Japan and Australia, are debating whether to lift their ban on exports to India of equipment and materials for atomic use.
AP Gencos Kothagudems 500 MW unit gets coal linkage
Coal Linkage Committee in New Delhi has approved supply of 2.5 million tonnes of coal per year from Western Coalfields Talcher to AP Gencos Rs. 21 billion 500 MW sixth unit of Kothagudem thermal plant.
And now the work on the project is poised to take off shortly. The project would be completed within 30 months from the zero date of commencement of work.
CCCEA approves highway project
Indian Cabinet gave approval for inclusion of an additional 1,113 km of national highways for up gradation in the third phase of the National Highways Development Project over and above the length of 10,000 km.
On the basis of the current prices, cost implication for additional 1,113 km comes out to Rs 7,257 crore out of which, investment from Government would be Rs 3,170 crore and by private sector Rs 4,087 crore.
CISA restates position over unreasonable iron ore price
The China Iron and Steel Association on Friday restated that China will not accept an iron ore price which does not consider the Chinese market. CISA said that "The price for 2006 should be made not only according to the European market but also to the Asian Market, especially the Chinese market."
Currently, the European market reports the highest price for steel. By the end of April, the composite steel price index on the global market rose to 149 points, close to last year's highest 153.4 points. However, the composite steel price index on the Chinese market only reported 105.67 points at the end of April, down 23.6% from March's highest 138.33 points.
CISA said Under such circumstances when the Asian market, especially the Chinese market, is at a low price level, Chinese steel companies would not accept a decision made without taking into account the Chinese market."
Mixed response to revised offer of Mittal Steel
Business Line has reported that some of the Arcelor investors were unimpressed by the latest increase in bid by Mittal Steel. Mr Colette Neuville, who spoke on behalf of French small shareholders' group Adam who have 5% stakeholder interest in Arcelor said the latest offer was "a step in the right direction but it's not in the interests of investors to decide now."
The biggest shareholder of Arcelor, the Luxembourg government, while declining to comment, said industrial interests and employment, not financial interests would guide it a view echoed by Walloon government in Belgium. The Luxembourg government and Government of Belgium hold 5.6% and 2.4% respectively of the shares of the steel maker Arcelor. No decision is expected to be taken by them until late June. Mr Mittal's revised offer runs out on June 29.
The board of Arcelor, which is scheduled to discuss the offer today is expected the decline the offer and reiterate its opposition to a friendly merger. The Board might expect a significantly improved cash element before recommending it to shareholders. According to the 'Guardian', Arcelor executives said that they will countenance only an all-cash deal worth up to 42 a share as against the revised offer of 37.74 per share.
POSCO & Rio agree for 19% price rise
UK based Rio Tinto said that POSCO has agreed to a 19% iron ore price rise. Rio said that the agreement to supply iron ore was for the contract year started April 1, 2006.
Mr Sam Walsh CEO of Rio Tinto's iron ore operations said in the statement ''This settlement confirms the tightness of the iron ore market and the very strong demand for Australian iron ore.''
Fines accounts for 60% of global trade in the commodity, and soared more than 71% last year to around $40 a metric ton for Australian ore.
Western Canadian Coal to acquire NEMI
Western Canadian Coal Corp and Northern Energy & Mining Inc announced having concluded a definitive agreement which relates to an business combination pursuant to which NEMI will become a wholly owned subsidiary of Western. The companies reported that the previously announced deal provides for the Transaction to occur by way of a plan of arrangement to be approved at a special meeting of NEMI shareholders, which is expected to be held on June 26, 2006.
Upon completion of the Transaction, Western will have approximately 115 million shares outstanding, with the basic ownership split of the combined company being approximately 73% Western and 27% NEMI.
Under the Definitive Agreement, Western is entitled to a break fee of $3.5 million in certain circumstances. NEMI's loan agreement with ITOCHU Corporation contains an event of default if control of NEMI changes without ITOCHU's consent. The Definitive Agreement is conditional upon receiving that consent.
The parties expect the combination to result in production of hard coking coal at the rate of 3 million tonnes per year by the end of 2006 rising to a rate of 5 million tonnes per year by the end of 2007. This is expected to give the combined company a critical mass that will enable it to be a significant supplier to global coal customers.
Esfahan Steel to transfer Saba to Mobarakeh
Mr Sobhani MD of Esfahan Steel Company rejected rumors that Esfahan Steel Company was in financial crisis and clarified that the transfer of Saba Steel Complex to Mobarakeh was solely aimed at supplying the financial resources required by the company for its underway projects most important of which was the Steel Mill Balance Project.
Esfahan Steel Company has agreed with a takeover bid by Mobarakeh Steel Complex over the purchase of its affiliated company, Saba Steel Complex. ESC has invested about Rls.4000 billion in Saba Steel Complex. The company has a nominal capacity of annually producing 700,000 tons of steel sheets and with some additional investments in the smelting and casting sections of the plant Saba Steel Complex would be able to produce 1.5 million tons of the commodities per annum.
ThyssenKrupp stands firm on Dofasco contract with Mr Mittal
Reuters have reported that ThyssenKrupp's CEO Mr Ekkehard Schulz said on Saturday that Mittal Steel is contractually obliged to offer German steelmaker ThyssenKrupp an alternative to Canada's Dofasco. Schulz told Reuters on the margins of a technology fair that "If Mr Mittal can not offer us Dofasco then he has to offer us something else. We have a contract with Mr Mittal." Mr Schulz did not say what alternatives would be interesting for ThyssenKrupp.
Mittal Steel is trying to take over rival Arcelor and if that bid proves successful, Mr Mittal has agreed to sell Arcelor's Dofasco unit to ThyssenKrupp for C$68 ($60.50) per share.
Mittal Steel's CFO Mr Aditya Mittal said on Friday that the steelmaker could sell ThyssenKrupp businesses in North America if the contract on Dofasco could not be fulfilled, but he did not give any further details.
44 coal miners trapped in flooded mine in Shanxi
It seems 44 miners have been trapped in a flooded coal mine in Zuoyun County, north China's Shanxi Province, rescuers said Saturday night. A total of 145 miners were working underground when the flooding accident took place on Thursday night and 101 managed to escape.
According to Gong Anku, head of the Shanxi Provincial Bureau of Work Safety the actual situation of the accident was covered up as local safety authorities had reported earlier that only five miners were trapped.
The flooding took place at 8:30PM Thursday at Xinjing Coal Mine, a legal township coal producing entity in Zuoyun County, northern Shanxi. The mine has an annual production capacity of 90,000 tons.
Japanese car makers not to pass on increased steel costs to buyers
Japans three largest carmakers Toyota Motor Corp, Nissan Motor Co and Honda Motor Co said that they will be unable to pass on higher steel costs to customers as competition limits their ability to raise prices.
Mr Takeo Fukui, president of Honda, in an interview said The price of steel rose quite a lot in the past year and we are not in the business environment to pass on the increase in the retail price of cars. We will start discussions with steelmakers. It will not be so easy for them to boost prices. Nissans COO Mr Toshiyuki Shiga said in an interview The increase in the cost of steel is a big problem for the industry. Mr Fujio Cho vice chairman of Toyota said We did not expect another year of price increases.
Higher prices for steel, rubber and other materials boosted Japanese automakers costs by at least $903 million for each company in the year ended in March, partly offsetting their cost reductions.
Mittal Steel says offer period may be extended
Mittal Steel said that the closing date of its offer for Arcelor might be extended slightly as a result of the improvements to its bid announced earlier on Friday. Mittal Steel CFO Mr Aditya Mittal told during a conference call "The offer period is open to June 29 and the close might be slightly extended because of the revision of this offer.
Mittal Steel hiked its hostile bid to 25.8 billion euros ($33 billion), based on Thursday's closing prices on Friday.
Shougang stops coke oven operation in Beijing
Beijing Shougang Groups 42 year old coke oven that has made huge contribution to China's metallurgy industry stopped operation in Beijing on Saturday to protect environment. Mr Wang Qinghai GM of Beijing Shougang Group, China's fourth largest steel maker, made the announcement and said the company is relocating polluting plants to the neighboring Hebei Province so that the national capital can have more blue skies.
The oven has produced 6.48 million tons coke, 380,000 tons of other chemicals and 2.6 billion cubic meters of coal gas since it started operation in December 1964.
Although widely regarded as a flagship enterprise in China's iron and steel industry, Shougang has been vehemently blamed for polluting the capital city in recent years and is considered a potential obstacle for the upcoming 2008 Beijing Summer Olympics. In response to the criticism, the company launched, under the approval of the State Council, an ambitious plan to relocate its polluting plants to the neighboring Hebei Province. According to the plan, Shougang has cut its steel output in the past few years and will further reduce the annual production of its Beijing factories to four million tons by 2007. By 2010, all the current Beijing-based steel operations will stop and move to Hebei with only the headquarters, research and development sections, sales departments and logistical center staying in the national capital.
Mr Mittal says that revised offer is compelling
Mr LN Mittal, who had repeatedly denied that he would raise his bid, now said that he hoped this revised offer would persuade the board of Arcelor to do the right thing by their shareholders and begin a dialogue with him.
Mr LN Mittal said Last time I said it was the best offer, now I am saying it is the most compelling. With a compelling offer, you are compelled to accept it.
Mr Mittal said he had decided to raise his offer because the steel industrys fundamentals had improved and that made the industrial logic of putting the two companies together even more compelling.
One miner found dead & 4 still missing in Beijing coal mine
One miner was confirmed dead and four more are still trapped in a collapsed coal mine in southwestern Beijing. Rescuers found one of the five miners trapped in the cave in of the coal mine in Fangshan District around 8:40PM on Friday and the miner was proclaimed dead. Fate of the remaining four trapped is unknown.
The No 6 coal mine in Lianhua'an Village of Fangshan District about 120 km from downtown Beijing, collapsed around 3AM on Thursday burying all the five workers, who were repairing a section of the shaft.
Norilsk Nickel to invest at Taimyr mines
Norilsk Nickel plans to produce 18 million tons of ore a year at its Taimyr Peninsula mines by 2020, compared with 14.3 million tons in 2005.
Mr Mikhail Bogdanov deputy director of Norilsk Nickel's Arctic Circle subsidiary said in an interview that the company plans to invest $3.2 billion in expanding output in the region. Ore production will be expanded at the Taimyrsky, Komsomolsky and Skalisty mines.
Norilsk Nickel's concentrating capacities, currently 15 million tons a year, will also be expanded, particularly at the Talnakh plant, capacity is estimated to increase by up to 10 million tons.
MMK denies plans to buy Arcelor stake Russian based
Magnitogorsk Iron & Steel Works said they are not planning to buy a stake in Arcelor. MMK denied the reports that appeared in a French newspaper. According to a MMK statement these reports does not correspond with reality.
According to the report MMK and Arcelor have been in negotiations for a possible tie-up. It was said that the tie-up was a possible measure to help Arcelor defend itself against the 22 billion bid from Mittal Steel.
Other Russian steelmakers are mum on this matter,
Kentucky coal mine explosion kills 5
In explosion in an eastern Kentucky coal mine killed five miners and one miner was able to walk away from the blast and out of the mine on his own. The five dead miners were found by rescue workers The blast at the Darby Mine No 1 in Harlan County occurred between midnight and 1AMEDT while a maintenance shift was on duty.
The underground mine, operated by Kentucky Darby LLC, is located about 400 kilometers southeast of Louisville in a mountainous area near the Virginia border. Since Kentucky Darby took over as operator in May 2001, there had been no deaths at the mine until Saturday's explosion and 10 injuries, according to statistics on MSHA's website.
The coal operators running Darby Mine No 1 have been cited 10 times this month for violating mine safety regulations, according to federal records. Four of those citations were for serious and substantial violations, including for the accumulation of combustible coal dust and a problem with the water sprinkler system and fire warning device at a belt drive, federal Mine Safety and Health Administration records show.
Darby Mine No. 1 employs 34 people, according to McKinney.
The mine produced 118,052 tons of coal last year, according to MSHA records.
Poland wants Mittal Steel to sell plants if it buys Arcelor
Poland is reported to have protested to the European Commission that it would break EU anti monopoly and fair competition laws if the merger of the world's two largest steel producers should come to materialize, without asking Mittal Steel or Acelor to sell out some of their plants in Poland.
Mittal Steel controls four steel mills in Poland accounting for almost 70% steel production of crude steel in Poland. Arcelor also controls Huta Warszawa a manufacturer of special steels.
Sumitomo Metals to focus on high end tube segment
Sumitomo Metal Industrys pipe and tube unit has decided to focus on producing high valued seamless steel pipe. It is investing 40 billion yen under the new 3 year plan started in April to expand the output capacity by 100,000 tonnes per year and allocates 70% of the expansion for high valued products.
Sumitomo is reinforcing its position as no.1 solution provider for oil and gas development by improving supply chain management and research and development for oil majors.
Ukrainian steel mills to buy Chinese equipments
It is reported that Ukraines three biggest steel producers, including Mittal Steel Kryviy Rih, are considering buying Chinese equipment to upgrade their production and to reduce consumption of natural gas.
Mr Volodymyr Hranovsky the deputy industrial policy minister said that the cost of Chinese equipment is significantly lower compared with European producers.
Ukrainian steel mills to buy Chinese equipments
It is reported that Ukraines three biggest steel producers, including Mittal Steel Kryviy Rih, are considering buying Chinese equipment to upgrade their production and to reduce consumption of natural gas.
Mr Volodymyr Hranovsky the deputy industrial policy minister said that the cost of Chinese equipment is significantly lower compared with European producers.
Ms Julie Renner of USS-POSCO receives AISI award
American Iron and Steel Institute chairman Mr Louis L Schorsch recognized Ms Julie Renner of USS-POSCO Industries for her outstanding leadership as chairman of AISIs Steel Packaging Council. The awards ceremony took place on May 9, 2006 at AISIS 114th General Meeting, which was held in Boca Raton, Florida.
Ms Renner is general manager of tin mill sales and marketing for USS-POSCO Industries. Ms Julie Renner was recognized for leading AISIs Steel Packaging Council from 2004-2006 in fulfilling its mission to advance the overall competitiveness of steel in the container market. The SPC conducts programs that remove barriers to canned food market growth, such as making consumers and influencers aware of the safety, convenience and recyclables of steel packaging. In addition, Ms Renner chairs the Canned Food Alliance Executive Committee. The CFA is a partnership of steel producers, can manufacturers, food processors and affiliate members who are committed to educating consumers, government officials, dietitians and culinary professionals about the nutritional and convenience benefits of canned food.
The Steel Packaging Council is part of AISIs Container Market Program, whose mission is to grow the tinplate market for North American steel. The members of AISIs Steel Packaging Council include Dofasco Inc, Mittal Steel US, United States Steel Corporation, USS-POSCO Industries.
DM&E asks board for approval to carry coal
The Dakota, Minnesota & Eastern Railroad has asked the federal Surface Transportation Board for permission to carry coal on a line. DM&E filed a petition urging the board to revise conditions that block the railroad from routing coal trains onto the Iowa, Chicago & Eastern Railroad, which runs south from the DM&E line at Owatonna, through Iowa to Chicago. The STB set the restriction as a condition of authorizing DM&E's acquisition of IC&E, then the IMRL, in 2002.
DM&E's petition says the restriction has made it difficult for the railroad to raise private funds for a proposed $2.5 billion upgrade and expansion. The project would revamp the entire DM&E line and extend it 260 miles to reach coal mines in Wyoming's Powder River Basin.
A few months ago, opponents to coal traffic being routed through Rochester were lobbying to have trains diverted onto the IC&E line as a condition of approving the project or its financing. The route, at that time, was called "the ultimate bypass."
