Indian government is studying the possibility of further restructuring the coal sector to make it globally competitive and end the inadequacy of domestically mined coal. Mr HC Gupta secretary coal while addressing International Coal Congress said "The Expert Committee on the Road Map for Coal Sector Reforms has been asked to examine the issue of restructuring of the coal sector in order to make it globally competitive.

Mr Gupta said the Ministry of Coal has taken some initiatives to encourage and promote investment in captive mining. He said "As per the projections made in the Vision Coal 2025, an additional Rs 95,000 crore in open cast mining and Rs 23,000 crore in underground mining will be required to increase the production to the projected level by 2025. He said the coal sector offers investment opportunity of about Rs.80-160 billion to meet the coal washing requirement of about 380 million tonnes by 2025. At present, India only has washing capacity of 100 million tonnes.

The draft Vision Coal-2025 has said the country will require 1,267 million tonne of coal by 2025 to sustain 8 % growth. Of this, the total domestic production will account for 1,061 million tonne. The government expects the demand to increase at a rate of 10 % over the next 10 years.

TATA Steel and BlueScope Steel Limiteds 50:50 JV Tata BlueScope Steel Limited has inaugurated its second LYSAGHT Building Components and Systems manufacturing facility at Bhiwadi in Rajasthan for manufacturing roof and wall cladding solutions under the brand name LYSAGHT.

Ms Kathryn Fagg president of Asian Business Markets of BlueScope Steel and Chairperson of Tata BlueScope Steel said We are happy to inaugurate the Bhiwadi facility at this time, as India prepares to host the 2010 Commonwealth Games. From the expertise and experience from its shareholders this facility is geared to create infrastructural capabilities for sports stadiums, railway stations and airports that will enhance this sporting experience in the forthcoming games.

Mr Chetan Tolia MD of Tata BlueScope Steel said, With our second plant in Bhiwadi we will further strengthen our offerings in the northern region of India. This plant is important for us in capturing markets in North India and gaining presence in SAARC countries like Pakistan and Nepal. It is a great opportunity to showcase our range of product and solutions for the forthcoming sporting activity that India will witness.

Dr Montek Singh Ahluwalia deputy chairman of planning commission while addressing International Coal Congress said that the feasibility of having a regulator for the coal sector could be explored on the lines of power and petroleum with the opening up of mines for captive use and increase in imports to bridge shortfall.

Dr Ahluwalia said 'It needs to be explored whether a regulator is required for the coal sector.

Dr Ahluwalia said stressing that coal would remain the preferred source of energy in the country, said that there was need for comparable pricing of different energy sources which need not be absolutely identical in the backdrop of the historic evolution of pricing in different sectors of energy sources.

Pricing is a major issue in India where affordability and availability has made coal a more attractive choice compared to gas or oil for operation of energy intensive units like power generation, fertilizer or steel.

The China Chamber of Commerce of Metals, Minerals and Chemicals Importers and Exporters has releases the average reference prices for import transactions of Fe 63.5% Indian iron ore concluded last week.

Change is with respect to CCCMCs price of lat week

The CCCMC reference prices are average prices for import transactions of Fe 63.5% Indian iron ore concluded the week prior to issuance date of such reference prices. The reference price practice is intended to regulate the domestic trading of Indian iron ore and avoid speculation.

Dr Dasari Narayan Rao minister of state for coal of India while addressing International Coal Congress said that Indian government has short listed Mozambique, Zimbabwe, Indonesia and Bangladesh for acquiring coal mines to bridge the domestic shortage. Dr Desai said that companies in steel, cement and power sector would soon heave a sigh of relief as far as sourcing of coal is concerned as the government plans to buy coal mines abroad.

Dr Rao said the mines would be acquired by Coal India Ltd through its subsidiary Coal Videsh Ltd, which has been created for this purpose. He said that "Coal India wants to have its own mines abroad. However, it is yet to be approved by the Cabinet."

Dr Rao added that a total of 35 million tonnes of coal was likely to be imported in the financial year ending March 2007 to meet the domestic shortage. India purchased about the same amount last year while it produced 407 million tonnes of coal during 2005-06.

Reuters has reported that USs antitrust authorities have approved proposal by India's TATA Steel to acquire Anglo Dutch steelmaker Corus Group.

The Federal Trade Commission said in a notice that their officials have completed their investigation of TATA Steel's offer without taking any action.

It is reported that in the massive landslide that buried 6 workers at a mining dump in Goa, only one body has been recovered so far although a combined effort by locals, the army, navy and the police. Mr Rajiv Yaduvanshi secretary mines told "It's a tricky site and despite political pressure, we cannot hurry up the recovery process for fear of causing another accident. It will take some time."

The Sanguem police have registered an offence against four officials of the mining company, including its managing director. They have been charged under Section 304(A) (negligence) of the Indian Penal Code. A magisterial inquiry has also been ordered by the government.

6 workers were killed when iron ore mining dumps collapsed in the Tollem mines in Goa. As per reports, nearly 100 meter high mining dump covering an area in a 200 meter radius gave way on Saturday and buried excavating machines and operators beneath them in the interior Sanguem iron ore mining region. According to eyewitnesses, the landslide was so sudden that those trapped were unable to even react.

The mine had received a safety clearance certificate from the Margao based Directorate of Mines Safety last week. It's the first major mining accident in Goa in more than 10 years.

Tata BlueScope Steel anticipates its revenues to grow to the tune of INR 1,500 crore by 2009-10. TATA BlueScope anticipates revenues of INR 150 crore in the current fiscal with three facilities operational in Chennai, Pune and Bhiwadi.

Mr Chetan Tolia MD of Tata BlueScope Steel during the inauguration ceremony of its new plant at Bhiwadi told reporter that We anticipate our revenues to cross INR 1,500 crore by 2010 and INR 2,200 crore by 2012-13.

Tata BlueScope Steel is 50:50 JV between TATA steel and Australia's Blue Scope. It plans to set up a color coding facility in Jamshedpur with an investment of INR 900 crore. The facility would be operational by late 2008 or early 2009.

Inter Institutional Group comprising of senior representatives from the Financial Institutions and Ministry of Power has been constituted to specially focus on fast track private power projects which could be taken up for early commissioning and could achieve early financial closure.

Mr Sushil Kumar Shinde Indias union power minister informed the Rajya Sabha that 16 private power projects having a total capacity of about 7320 MW have since achieved financial closure and another 7 projects with a total capacity of 9357 MW are being monitored by the IIG for facilitating early financial closure.

As per information available, the targets and actual achievements of the Independent Power Producers in terms of capacity addition during 8th, 9th & 10th Five Year Plans are as follows

*Likely achievement during the Xth plan of which 1931 MW has already commissioned.

Mr Shinde informed that the major constraints faced by the Independent Power Producers due to which they failed to achieve the target have been
1. Failure to obtain environmental clearances
2. Financial constraints faced by the promoters
3. Land acquisition and resettlement & rehabilitation issues
4. Failure to obtain fuel linkages
5. Failure to conclude Power Purchase Agreements etc

Indian Railways have carried 464.37 million tonnes of revenue earning freight traffic during 1st April to 30th November 2006. The freight carried shows an increase of 42.42 million tonnes over the freight traffic of 421.95 million tonnes actually carried during the corresponding period last year, an increase of 10.05%.

During the month of November 2006, the revenue earning freight traffic carried by Indian Railways was 61.04 million tonnes. There is an increase of 6.01 million tonnes over the actual freight traffic of 55.03 million tonnes actually carried by the Indian Railways during the same period last year, an increase of 10.92%.

It is reported that Power Finance Corporation has postponed opening the price bids for the first two ultra mega power projects in Madhya Pradesh and Gujarat tentatively to December 18. PFC was scheduled to open the price bids for Sasan and Mundra projects on 9th December 2006. However the deadline for awarding the projects by December 29 remained unchanged.

PFC is the nodal agency responsible for conducting the bidding of ultra mega power plants. An apex committee comprising of Mr SC Gupta chairman of PNB, Mr VK Garg chairman of PFC, Mr Rakesh Nath chairman of Central Electricity Authority and state government representatives would scrutinize the bids

PFC has received 10 requests for proposals for the pithead coal fired Sasan project in Madhya Pradesh 6 companies have bid for imported coal based Mundra power plant in Gujarat.

MR Infrastructure Ltd has awarded a Rs 5,400 crore contract to Larsen & Toubro Ltd to design and construct the terminal and runway at New Delhi airport.

GMR is the developer for New Delhi's international airport.

Companhia Siderugica Nacional has unveiled a firm counter offer for Corus at 515 pence per share, valuing Corus at $9.6 billion, excluding debt, as against TATA Steel's revised offer of 500 pence per share. Details of the financing arrangements made by CSN have not been announced.

In addition CSN has offered a slightly higher amount than Tata Steel, in order to bridge the deficit in pension funds and has also agreed to match TATA Steel's offer of increasing future contributions to 12 per cent from 10% to 12% to win over the pension fund trustees of Corus.

The Corus board is expected to meet soon to consider the CSN offer. The board last met on Sunday, when it considered, approved and recommended the revised TATA Steels offer at 500 pence per share.

Mr Benjamin Steinbruch chairman of CSN was quoted as saying in a BBC report that "The strategic impetus for this combination is growth in Brazil, in Europe and for our combined workforces. Our goal is to unlock the value of our iron ore assets through Corus, transforming them into cost effective, high quality steel products using Corus' advanced engineering capabilities and its excellent European distribution platform. This is a winning combination for all stakeholders."

Mr Jim Leng chairman of Corus was quoted as saying in the same report that "This offer is both higher than the initial proposal by CSN as well as the revised Tata offer of 500 pence a share. It is also consistent with our strategic objective of securing access to raw materials, low cost production and growth markets. The combination of the two businesses will create a strong platform from which to compete and grow in an increasingly global market."

POSCO announced that it has agreed with Nippon Steel Corp to join forces in iron ore price settlement with mining giants next year for stronger bargaining power. The two strategic partners plan to conduct a joint market study on global supply and demand of iron ore as prices continue to rise sharply with increasing Chinese demand.

Mr Toshiharu Sakae GM of the iron ore department at Nippon Steel, told reporters in Tokyo that the agreement will help strengthen the two companies' bargaining power. He said We want to rein in prices of the material as much as possible.''

POSCO said that We hope to stabilize purchasing conditions by jointly conducting market research and closely cooperating on price negotiations amid the rigid demand and supply situation and rising iron ore prices because of the sudden increase in demand from China.

Nippon Steel and POSCO signed a 5 year strategic tie up agreement in 2000 and extended the accord last year. The two companies said in October they would cooperate in making joint investments to secure supplies of raw materials, as well as supply each other with steel slabs for five years starting 2007. Nippon Steel and POSCO also said in October that they would spend more than a total of $900 million to increase their stakes in each other to ward off hostile takeover bids amid increased consolidation activity in the steel industry.

According to the latest import and export statistics, China's export of finished steel products stands at 4.63 million tonnes in November 2006 and 37.46 million tonnes for the first 11 months. Chinas monthly import of iron ore registers 28.56 million tons in November 2006.

Exports

In million tonnes

Imports

In million tonnes

Note
October import and export express data published herein are subject to revision by China customs at the end of December 2006.

(Sourced from Mysteel.net)

The US International Trade Commission has determined that revoking the existing antidumping duty orders on stainless steel bar from Brazil, India, Japan, and Spain would be likely to lead to continuation or recurrence of material injury within a reasonably foreseeable time.

As a result of the Commission's affirmative determinations and the Department of Commerce's recent affirmative findings, the existing orders on imports of this product from Brazil, India, Japan, and Spain will remain in place.

The 5 year sunset reviews concerning Stainless Steel Bar from Brazil, India, Japan, and Spain were instituted on March 1st 2006.

The Government of Liberia and Arcelor Mittal have announced that they have successfully concluded the review of the mining development agreement signed in 2005. This landmark agreement will bring the country investment of over one billion US dollars and is expected to generate about 3,500 direct jobs and about 15,000 to 20,000 indirect jobs in Liberia by the time full mining production is realized. With this iron ore mining agreement, the Government and Arcelor Mittal will be partners in jumpstarting economic recovery and development for Liberia.

The first version of the agreement, for a concession lasting 25 years and allowing the steel group access to one billion cubic meters of iron ore had been signed by Mittal Steel in August 2005. Under those terms, Mittal Steel was to invest about 900 million dollars. The new government in Monrovia had wanted to re negotiate improved terms for Liberia

Ms Ellen Johnson Sirleaf president of Liberia said "With this agreement, which is consistent with the principles that attract and sustain foreign investment in Liberia, it is clear to the international private sector that Liberia is open for business".

Mr LN Mittal president and CEO of Arcelor Mittal said "I am happy that the Government of Liberia and Arcelor Mittal have reviewed the Mineral Development Agreement jointly in good faith and have agreed to changes which allow the project to move forward. This will enable the economy of Liberia and the people of Liberia to benefit significantly. We will now focus on getting the job of reviving the mine accelerated"

Moody's Investors Service said that the fundamentals of the Asian steel industry remain solid but may bend around the global consolidation trend and besides consolidation the industry may face the risk of permanent increases in cost platforms and greater industrialization in major emerging countries.

Mr Terry Fanous senior VP said that Asia remains a major driver for the global steel industry, with China playing a dominant role and India as an emerging main player. He said "Looking into 2007, fundamentals are expected to remain supportive of Asia's steel sector, considering the expectation for continued solid gross domestic product growth in China and the Government's measures to manage down the level of exports.

Mr Fanous added that "Having said that, Asian steel fundamentals over the next 12 to 18 months will largely depend on China's ability to manage both the growth in its production capacity as well as the rise in its major consuming sectors, such as construction. It's a fine balance, and any major shifts in demand or supply will undoubtedly impact the regional environment.

Moody's said China's excess supply of long products and lower grade flats remains a major factor for the region, limiting any substantial growth in prices and higher end products should maintain a reasonably solid position into 2007 due to tight a demand supply balance.

Spain's third largest power company Union Fenosa last week agreed to buy 70% of South African coal producer Kangra Coal for Euro 136 million to ensure coal supply. Fenosa would acquire the stake from Kangra Group and Shanduka Resources.

Kangra Coal produces 2.4 million tons of coal a year and has reserves of more than 80 million tons. Kangra Coal also owns a 2.3% stake in Richards Bay Coal Terminal, the world's biggest coal export terminal.

The Wall Street Journal reported that US intends to scrutinize the Mr Roman Abramovichs links with Kremlin for clearing proposed $2.3 billion purchase of Oregon Steel by Evraz.

The report cites as Mr Daniel Lucich a former deputy assistant secretary at the US Treasury saying that "The government may not need to know every last special purpose vehicle (Abramovich controls) but what they do need to know is whether Evraz is owned, controlled or influenced by a Russian or other government interest.

Xinhua has reported that a campaign is underway in China to curb soaring energy consumption in key industries and is expected to save 100 million tons of coal in the 2006-2010 periods.

Chinas National Development and Reform Commission urged local supervisory departments to finish an inspection of an energy saving plan of 1,008 companies, which make up one third of the country's energy consumption every year.

They are in nine key industries: steel and iron, non ferrous metal, coal, power, oil and petrochemicals, textile and paper making, chemicals and construction materials.

NDRC said that companies that can not finish their energy saving plan in time or commit fraud in the process will be deprived of any preferential policies.

A latest notice issued by China's top planning body NDRC requires Hebei Province to expedite elimination of backward steel capacity of 11.44 million tonnes, according to a report by China Industrial Economy News.

Earlier, the department of industry under NDRC convened a symposium with the theme of promoting close of obsolete capacity next year, attended by provincial development and reform commissions, economic and trade committee and various steel enterprises, mysteel has reported.

Mr Sun Jijun vice chairman of Hebei Province metallurgical association commented that "11.44 million tonnes target will be difficult to be fulfilled, for the commission has not defined this volume specifically."

In Hebei Province, obsolete capacities, BF with 300 cubic meters or below, converters and EAF of 20 tonnes or less accounted for 45% and 27% of total capacities of the province. Mr Sun said "Private mills cover 66% of the province's total, accounting for 32% of the steel output. They are however private properties under protection of the constitution. Without breaching laws of quality, environment, safety and resources, they shall not be deprived of the production right."

On the earlier symposium, Metallurgy Chamber of Commerce All China Federation of Industry & Commerce had voiced the different regarding criterions to measure backward facilities and suggested to add further norms of resource consumption, environment protection etc.

Industry insiders confirmed the chamber's suggestion with rationality, but expressed unable to judge whether this will work on the lawmakers to revise existing policies. "A series of problem will come along with the change;" according to Mr Lup Bingsheng, "and supported measure should be offered to boost the process steadily with market continuing taking the priority."

(Sourced from Mysteel.net)

Precision Castpart has announced that it is acquiring GSC Foundries. Precision will finance the acquisition with cash on hand and its existing credit facilities. Terms were not disclosed. The deal is expected to close by April 2007.

GSC is a private company which manufactures aluminum and steel parts for the aerospace, energy and medical industries with facilities in Ogden, Utah, and Mexico.

Mr Mark Donegan CEO of Precision Castparts said that the acquisition will complement the company's existing casting operations and expand its market share.

Portland based Precision Castparts manufactures metal parts for a variety of uses including aerospace and industrial gas turbine applications.

According to the American Iron and Steel Institute, US steelmakers saw their weekly output fall from the previous seven days.

Production among domestic steelmakers was about 1.860 million net tons for the week ended December 9. That was down about 0.2% from the 1.865 million net tons produced for the week ending December 2nd 2006.

Year to date production, as of December 9th 2006, was about 99.7 million net tons.

AISI is a nonprofit association of North American companies involved in the iron and steel industry. The organization's data is based on reports from companies representing about 75% of the domestic industry's raw steel capacity.

Russian coal major Kuzbassrazrezugol has increased its coal output by 2.6% YoY during January to November 2006 to reach 37.907 million tones as against 36.933 million tonnes in January to November 2005. Its coke output also rose by 7% to 3.764 million tonne from 3.517 million tonnes.

Kuzbassrazrezugol supplied 36.607 million tonnes of coal to the consumers and exported 16.288 million tonnes during this period.

Kuzbassrazrezugol has 13 coal deposits under its control and develops 17 mines in the region.

Peabody Energy announced that its COALSALES LLC subsidiary has entered into a 10 year coal supply agreement with Tennessee Valley Authority to supply 6 million tons per year of Illinois Basin coal.

The coal supplied under this agreement is expected to be sourced from a combination of existing and future Illinois Basin mines. Coal sales under the first five years of the agreement are expected to be in excess of $1 billion.

TVA is one of USs largest public power providers. TVA provides power to large industries and 158 power distributors that serve approximately 8.7 million consumers in seven southeastern states. TVA also manages the Tennessee River and its tributaries to provide multiple benefits, including flood damage reduction, navigation, water quality and recreation.

Mr Richard M Whiting. Executive Vice President and Chief Marketing Officer of Peabody said that "We are pleased to strengthen our valued customer relationships through long-term coal supply agreements with key customers like TVA. Peabody has a long tradition as a reliable supplier and offers the strength of vast resources and flexibility of sourcing through multiple mines, thanks to our unmatched 10 billion ton reserve portfolio."

Peabody Energy is the world's largest private sector coal company, with 2005 sales of 240 million tons of coal and $4.6 billion in revenues. Its coal products fuel approximately 10% of all U.S. electricity generation and 3% of worldwide electricity.

Northwest Pipe is named as pipe supplier to JF Shea Construction of Walnut in California for a water treatment plant in Orange County. It will 5,000 feet of 24 inch through 120 inch diameter steel pipe value at $7 million for an engineered and custom fabricated piping system.

The pipe is expected to be manufactured in the company's Adelanto division with delivery scheduled to begin in the third quarter of 2007.

The pipe is to be installed in Orange County Sanitation District's Treatment Plant No 2.

Jiangsu Shagang Group Co Ltd's 16mm to 60mm large gauge wire rod production line comes on stream on December 8th 2006. The 1 million tonne per annum new production line enables Shagang to produce wire rods with full diameter range of 5.5mm to 60mm.

Shagang initiated construction of the large gauge wire rod project last year to produce such steel varieties as cold forging steel, free machining steel, spring steel and stainless steel.

Jiangsu Shagang Group is located in ZhangJiagang City an Economic Development Zone of the Yangtze River.

(Sourced from Mysteel.net)

Zinifex Ltd and Umicore SA have agreed to combine their zinc smelters and sell shares in what would be the world's largest producer of the metal. The new company will be formed by the third quarter of 2007,

The new company, to be incorporated in Belgium and based in London, will overtake Korea Zinc as the biggest producer with annual production of 1.2 million tons of zinc and about 250,000 tons of lead. It will be headed by Mr Paul Fowler, currently the chief operating officer at Zinifex. UBS AG is acting as exclusive financial adviser to both companies.

A company statement said The combined business would possess a portfolio of quality assets and would benefit from a presence in both established and emerging markets. It would also possess significant expertise in the development and marketing of zinc die-casting and galvanizing alloys.''

Spinning off its smelters may allow Zinifex to buy mines to take advantage of a more than doubling in the zinc price this year. Selling the high cost smelting operations may make Zinifex a more attractive takeover target.

Arch Coal Inc announced that its board of directors has elected Mr Paul A Lang as senior vice president of operations. Mr Lang most recently led Arch's western operations as president of Arch Western Resources LLC.

Mr Lang will continue to report to Eaves and reporting to Mr Lang are Mr Bob Shanks president of Eastern operations, Mr Gene DiClaudio, president of Arch Western Bituminous Region, Mr Ken Cochran, president of Thunder Basin Coal Co and Mr Jim Kliche director of operations support.
Mr Lang joined Arch in 1984 and has held various engineering, operations and management positions at the company's operations in both the eastern and western United States, including general manager of Arch's Powder River Basin and southern Wyoming operations from 1998-2005. He graduated from the University of Missouri-Rolla in 1983 with a BS in mining engineering and is a licensed professional engineer in several states. He also is a graduate of the Advanced Management Program at Harvard University.

Mr John Eaves president and COO of Arch Coal said "Paul has done an outstanding job leading Arch's western operations during a period of tremendous growth and change. "We think Paul is ideally suited to help Arch extend its industry leading position in safety, environmental stewardship and productivity."

The Persian service of ISNA reported that the preliminary studies aimed at the building a steel plant in Khorramshahr city located on the border between Iran and Iraq in southwestern Iran has been completed and the project is ready to be launched soon.

The steel plant will have capacity of around two million tons per annum. The first stage of the project, expected to be completed in 2010 calls for an investment of around $300 million.

Xstrata Nickel has announced a $18 million project, which will further define a nickel copper ore body using Sudburys Fraser Mine shaft and infrastructure. Xstrata Nickel will complete a pre feasibility study, definition drilling, equipment procurement and infrastructure improvements at the 3,900 foot level of the Fraser Mine by March 2007.

This will allow for the development of potential ore handling from the new Fraser Morgan nickel project.

The 4.9 million tonnes of measured ore body was discovered in 1995, and consists of five separate mineralized zones with reserves grading 1.8 per cent nickel, 0.65 per cent copper and 2.4 million tonnes of inferred resources grading 1.8 per cent nickel and 0.5 per cent copper. The deposit is located two kilometers east of the Fraser Mine.

Koppers Holdings Inc announced that it has entered into a JV agreement with two Chinese companies to construct a state of the art tar distillation facility in the Hebei Province near the Jingtang Port.

The plant will be capable of distilling approximately 300,000 metric tons of tar into various products including carbon pitch, carbon black oils and naphthalene.

Koppers will own a 30% interest in the facility and will partner with Kailuan Clean Coal Company Ltd and Tangshan Iron & Steel Group Company Limited.