PTI reported that a barge MV Warren carrying 2,000 tonnes of iron ore sank off Panaji port in Goa after being hit by another barge MV Sea Horse also laden with iron ore as both of them were proceeding to unload the material in the transhipper anchored in the port.

No casualties were reported in the accident as all the crew members were immediately rescued by another boat.

Mr Sankulp Amonkar executive member of Goa Barge Owners Association told PTI that "Water gushed into the engine room of the ill fated barge after it developed a crack. The entire ship sank within an hour." Mr Amonker added that "There was no obstruction to the barge or ship movement as the accident did not occur in the channel but in the sea.

Around 300 barges are operating in Goa waters, all of them carrying iron ore from different destinations across the state. 6 barges sank off Goas coastline since last year mostly during monsoon due to bad weather.

BS reported that the union ministry of steel has directed Steel Authority of India Ltd and Rashtriya Ispat Nigam Ltd public sector units to contribute 2% of its net profit under corporate social responsibility for adopt villages to promote steel consumption and that the private steel makers are also likely to follow the government direction.

Mr RS Pandey secretary steel while speaking on the sidelines of the International Steel Seminar & Exhibition 2007 organized by Steel Scenario said that although was no directive on private sector units but the matter had been discussed with the companies. He added that JSW Steel has written to the ministry, informing that the company had adopted one village.

As per report, SAIL and RINL have identified 10 villages around their plants, where they could push steel in different forms including bullock carts.

Indian left front Communist Party of India (M) has questioned the rationale behind the Indian government's recent decision to reduce customs duties on steel, cement and metals on the pretext of curbing inflation to check inflation and has linked it with appeasing international investors gathering World Economic Forum at Davos in Switzerland.

Mr Sitaram Yechury politburo member of CPI (M) in the editorial in the latest issue of CPI(M) news letter People's Democracy said that The decision to drastically reduce customs duties across the board in India comes on the eve of this year's Davos summit. Is the real intent of this slashing of duties a signal to please the international investors? Is the concern for containing inflation, thus, an eyewash?

Mr Yechury said that by merely making imported items cheaper, the general price rise couldnt be contained as was witnessed in the recent past when imports of food grains did not stem price rise in essential commodities.

He added that Such a liberal reduction in import duties will adversely affect domestic production of the same commodities leading to de industrialization and consequent growth of unemployment in India. Such an across the board reduction of duties means reduction of government revenues.

It is reported that in a move to overcome the pricing policy of stet run electricity boards, Indian Railways is conducting discussions with NTPC Ltd and Power Grid Corporation of India Ltd to establish a tie up for power supply at a lower per unit cost than the present levels for its entire rail network.

Mr Ramesh Chandra Member Electrical of Indian Railways said that "We are pursuing the matter with NTPC and PGCIL. High charges push up Railways' unit cost of transportation and affect the tariff structures."

Different zonal railways pay different charges to various SEBs and companies, with per unit price ranging from INR 2.94 to INR 5.04. Indian Railways shells out an average of INR 4.22 per unit for traction and INR 4.12 per unit for non traction use. On an annual basis, it consumes 13 billion units, out of which 10.4 billion are for traction.

The Railways needs 2,200 MW capacities, while NTPC has 26,194 MW. As per report, NTPC provides electricity to SEBs at an average of INR 1.47 per unit it charges INR 2.94 per unit from the Railways.

Washington based International Finance Corporation is reported to be in discussions with TATA Power for facilitating long term debt arrangement for funding ultra major power projects.

Mr Iyad Malas director of South Asia while speaking at an international factoring conference in Mumbai said that the World Bank arm is looking at long term funding opportunities in the range of USD 200 to USD 300 million in ultra mega power projects and is already in talk with TATA Power.

Mr Malas also said that it is also looking at other infrastructure projects, especially in the road sector since it has the advantage of providing long term funding.

National Thermal Power Corporation and a consortium comprising of Russia's Zarubezhvodstroi and Indian group SSJV signed an agreement last week on the technical and commercial terms of a contract to build hydropower plant in Uttar Pradesh.

The consortium won an international tender to implement the USD 250 million Tapovan hydropower project within 44 months.

Jharkhand has assured all assistance to National Thermal Power Corporation in acquisition of 2,600 acre of government and private land required for setting up the 1980 MW North Karnpura super thermal power project at Tandwa in Chatra distrct of Jharkhand.

Mr Madhu Koda chief minister of Jharkhand, after viewing a presentation by the NTPC on the North Karnpura project, told media persons "Officials of Revenue & Land Reforms Department and the Deputy Commissioner of Chatra and Hazaribag will be asked to expedite the work pertaining to land acquisition for the STPP.

Mr Koda however cautiously added that the state Government would also ensure appropriate payment of compensation to affected farmers before acquiring their land.

It is reported that Power Grid Corporation India Limited has not awarded a letter of selection to Reliance Energy Transmission for Indias first transmission line project fully built by a private company in the state of Maharashtra and Gujarat after it emerged as the lowest bidder on November 21st 2006.

The delay has prompted power regulator Central Electricity Regulatory Commission to ask PGCIL to expedite the process as further delay in issuing the letter would not allow the project to be commissioned in time, which is slated to be commissioned by March 2010.

The media report mentions as PGCIL saying that the evaluation is being done and the letter would be issued well within the outer limit of April.

The two projects are part of PGCIL's INR 5,000 crore western grid scheme. While one project is for building sub stations and grid lines in southern Maharashtra at a cost of INR 1,100 to INR 1,200 crore, the second entails setting up grid lines in Gujarat at an investment of about INR 500 to INR 600 crore.

Bharat Earth Movers Limited, under its diversification drive, is reported to be planning to launch lubrication oil brand BEML Oil targeting institutions and contractors who use BEMLs range of heavy machinery.

BEML Oil will be produced by Nandan Petrochem which operates an oil packaging plant at Silvassa.

The concentration level of China's steel industry keeps declining although the government is trying to push consolidation of domestic steelmakers. China Business News in its latest report said that the top ten producers take up 34.7% of total steel output in 2004, with equivalent figure slipping to 33.6% in 2005 and 29% in 2006.

The reality is widening the gap with the target set by China's top planning body NDRC in the new steel industrial policy that top ten steelmakers are expected to account for over 50% of domestic production by 2010 and over 70% by 2020.

In addition to slow progress of steel consolidation, stunning expansion of privately owned steel mills is also contributing to lower concentration of the steel sector. Last year, private steel mills have recorded that their output of crude steel, pig iron and finished products advance by 34.07%, 24.24% and 39.75% from 2005 respectively, as compared with equivalent figures of 15.15%, 18.36% and 17.62% posted for the mills in the public sector.

Ownership issue is the main reason behind slow movement of merger involving steel mills in the private sector. Issues such as whether companies should pay taxes to local or central government and differences in product structure also are complicating the merger process.

Some analyst noted that the slow progress of merger & acquisition in China was due to lack of support from the government. He called for more efficient action from the government as more cross region deals are expected to emerge modeling on Baosteel-Bayi case.

(Sourced from MySteel.net)

MEPS have reported that EU steel market is quiet while buyers are holding back from placing business because they sense that prices may fall further during the first quarter as commercial quality material is readily available from a number of sources at highly competitive prices.

MEPS see 2007 outlook for Germany's steel using industries as very positive with current consumption at a satisfactory level. But it said that the proposed first trimester increase has been rejected by customers, who are anticipating the arrival of large quantities of third country imports early in the year, service centre stocks are rising although end users inventories are normal and lead times from EU mills are shortening.

MEPS said that prices are generally down in the French market at the beginning of January as a consequence of lower import offers and 3rd country material is due to arrive in the coming 2 to 3 months but is unlikely to flood the market.

MEPS said that the downward price trend that started in Italy at the end of summer 2006 continues as domestic mills drop prices in reaction to escalating volumes of import and stock levels at most distributors will cover them until February March. It added that buyers are loathe to speculate until they can see the direction of the market for 2007 as there are too many offers compared to demand.

MEPS said that, in Belgium, EU mills are no longer claiming basis price increases for period one and in fact some products have suffered a downward correction. It said that third country imports, ordered in the 4th quarter, are now arriving and putting further negative pressure on values although new foreign offers are not so interesting.

MEPS concluded that considerable volumes of non EU imports continue to undermine the Spanish market, despite a positive business climate. This has impacted particularly on resale values, which have dropped sharply over the last month, as distributors fight for orders and try to rid themselves of excess stock. Real consumption has moved very little. Construction is slowing, albeit from a high point. With the exception of major projects in the Madrid area, investment in public works is quite low.

PTI reported that two days ahead of open bidding for Corus with TATA Steel, CSN exuded confidence saying that it was determined to acquire Corus.

A CSN spokesman told PTI "We are determined to acquire Corus. And given the synergies afforded to us by our ability to supply low cost ore to Corus, we enter the process with confidence."

TATA Steel has not made any comments on this development.

Japan Iron and Steel Federation last week announced that the apparent steel consumption in 23 countries will increase by 8.5% YoY to 1.138 billion tonnes in 2007 as compared to 2006 and the crude steel output in 2006 will increase by 7.4% YoY to 1.142 billion tonnes.

JISF also said that that Chinese apparent steel consumption in 2007 will increase by 17.9% YoY to 521 million tonnes while the crude steel output increases by 17.1% to 492 million tonnes.

JISF expects that world steel output and trade would keep growing under worldwide economy growth despite of inventory adjustment in Europe and USA.

Xinhua last week reported Shougang Group controlled Shanxi Yujin Iron & Steel Co in Shanxi Province of China has been fined CNY 185 million (USD 23.7 million) for tax evasion and 11 employees have received prison sentences ranging from two to eleven years.

According to Linfen Intermediate People's Court, Shanxi Yujin Iron & Steel Co was accused of making up fake sales invoices for scrap steel in order to evade CNY 182 million of taxes from January 2002 to March 2005,

Founded in October 2001, Shanxi Yujin Iron & Steel Co now has a yearly production capacity of one million tons of iron and 2 million tons of steel. Shougang group signed a strategic cooperation agreement with Linfen City on November 19th 2004 and bought 51% shares of Shanxi Yujin Iron & Steel Co Ltd.

BaoSteel has recently put forth its management policy and goal for 2007 for further improving its management system and carry forward its own expansion.

According to the policy, BaoSteel will take measures to reduce costs, elevate operational efficiency and invest more in product innovation to sharpen its competitiveness. In the mean time, in order to protect environment, the steel maker will continue to develop cyclable economy.

Baosteel's 3rd round of development planning will start up and the steel maker will try to rank in the top 3 of global steel industry by 2010.

Platts reported that Capesize iron ore ocean freight rates have eased over the last week, which some brokers have attributed to slack demand for thermal coal by power stations in Northern Europe as a result of a very mild winter, increasing the number of ships available in the Atlantic.

However the report cites some ship brokers as saying that the strength of demand for seaborne iron ore has prevented the market from falling too far and rates could be headed higher.

The report mentions the rates changes in last 10 days on major bulk routes as under

Rates in USD

Mozambican government will soon publish its report on the feasibility study of the Moatize mining project carried out by CVRD.

Mr Esperan Bias minister of mining resources of Mozambique said I think we will make an announcement about the project within the schedule set.

The Mozambican government recently said it would publish its opinion on the work, which began in November and took two months. It has created a multi sector team to analyze the document.

Moatize, located in Tete province has around 2.5 billion tons of coal reserves and is one of the worlds largest deposits.

Russia has increased iron ore production in 2006 to 102 million tons up by 7.3% YoY as compared with 2005.

Russia has increased coal production in 2006 to 309 million tonnes up by 3.6% YoY as compared with 2005.

Platts, citing a company official, reported that Korea Zinc will maintain zinc production at its domestic Onsan plant in 2007 at the maximum capacity of 430,000 tonnes per year, almost similar to production achieved in 2006.

Korea Zinc, however, expects to raise output at its Sun Metals plant at Queensland in Australia, which had expanded capacity following some upgrading works in 2006. The report cites as the official saying that "We expanded the Sun Metal plant by 20,000 tonnes per year last year and now the capacity is 220,000 tonnes per year. We expect to produce a full output of 220,000 tonnes this year at Sun Metals."

Teck Comincos Pend Oreille mine in the US state of Washington has suspended activities after a fatal mining accident.

Mr Mark Brown GM of the mine in a statement to the local press said The mine shut down after the accident and we immediately notified all the proper federal and state agencies. A full investigation will be undertaken.

Pend Oreille produced 45,000 tonnes of contained zinc and 8,000 tonnes of contained lead in 2005.

Massey Energy Company MEE reported that produced coal revenues for its fourth quarter ended December 31st 2006 increased by 11% YoY to USD 471.7 million from USD 424.4 million in the fourth quarter of 2005, while net income was USD 10.7 million as against a net loss of USD 211.8 million.

Fourth quarter 2005 earnings include an after-tax charge of $216.2 million related to a capital restructuring. EBITDA in the fourth quarter of 2006 was $78.8 million compared to $84.4 million in the fourth quarter of 2005, excluding the capital restructuring charge.

The Company achieved record produced coal revenues for the full year 2006 of USD 1.902 billion on sales revenue per ton of USD 48.71.

Mr Don L Blankenship chairman & CEO of Massey said "The full benefit of strong market pricing during 2006 will be realized by Massey over the next several years. The Company currently has cumulative committed sales of approximately 87 million tons of coal over the next three years at an average realization of over USD 50 per ton."

Precision Castparts Corp announced that its fiscal 3rd quarter profit rose by 69%YoY on strong demand from the aerospace industry for its investment cast products and fastener products.

Its earnings for the quarter ended December 31st increased to USD 158.7 million as compared to USD 93.7 million during the same period last year and Revenue grew by 62% YoY to USD 1.38 billion from USD 857.3 million during the same period a year before.

Sales of the company's investment cast products improved 13% YoY to USD 451.5 million, driven largely by demand from the commercial aerospace market, as well as strength in the aftermarket segment and key military programs. Sales of fastener products rose by 27% to USD 254.5 million, boosted by organic growth and an increase in revenue from its acquisition of Shur-Lok.

Precision Castparts manufactures metal components and products for the aerospace, power generation, automotive and other markets.

Russias major producer of refractories Magnezit Group plans to invest RUB 99.6 million in 2007 to start work at the Satkinskaya group of magnesite deposits in the Chelyabinsk region and also plans to conduct exploration at the Satkinskaya group's Semibratskoye deposit.

The money will be spent on developing the Satkinskaya group's Yelnichnoye deposit, including acquisition of equipment, construction of a road, power lines, warehouses and other measures to prepare the deposit for mining.

As per report the company is now mining magnesite at the Karagaisky open cast mine and the Magnezitovaya deep mine with annually increasing production expected to increase production by 13.3% to 850,000 tonnes in 2007.

Magnezit also holds the license to the Goluboye deposit in the Krasnoyarsk territory, where it plans to invest 1 billion rubles in 2007 to 2009 in the construction of a processing complex. The complex will include a plant to produce 95,000 tonnes of roasted magnesite per year, a coal gasification division, warehouse and workers' village.

Magnezit's deposits in the Chelyabinsk region have combined proven reserves of more than 150 million tonnes.

The steel processor Steel Technologies Inc said that its Q1 fiscal profit dwindled to less than USD 1 million from more than USD 3 million a year ago on a combination of declining steel volumes and rising costs. Sales in the quarter fell to USD 200.8 million from USD 201.2 million a year earlier. Volumes dropped 9 % year over year and the decline was only partially offset by higher selling prices in the quarter.

Mr Bradford T Ray chairman and CEO of STI in a statement said that The Company is not pleased with the results of the past quarter. Though soft demand from certain customer segments and steel price volatility had a negative impact on our financial performance, we view this as a temporary setback. Current shipment levels and forecasts point to improved volume in our second quarter."

The Omaha based US's largest railroad operator Union Pacific Corp last week reported a 64% jump in 4th quarter net income. UP said that it earned USD 485 million during the quarter up from last year's USD 296 million. Union Pacific's quarterly revenue grew by 9% percent to USD 3.96 billion from USD 3.62 billion in Q4 of 2005.

Union Pacific said it posted improved revenue in five of its six business groups, led by 20% increases from shipping agricultural and energy related commodities, whereas revenue from industrial products fell slightly.

Mr Jim Young president & CEO of UP said "Overall, we turned in a great fourth quarter performance, a strong finish to a record year. In 2006, we significantly improved our return on invested capital and laid the foundation for further operational and financial improvement, benefiting both our customers and our shareholders."

UP also said that its operating ratios, operating expenses to revenue, a key measure of efficiency for railroads, improved to 79.6% in 2006 from 85.3% in 2005, e best operating ratio in more than four years.

Other railroad majors Burlington Northern Santa Fe Corp and CSX Corp have also reported strong jumps in 4th quarter profits last week with increase in earnings of 21% and 46% respectively.

Pittsburgh based US coal miner Consol Energy Inc announced last week that its 4th quarter profit rose by 46%. Its net earnings in 4th quarter were USD 127.9 million as against USD 87.6 million in Q4 of 2005 and revenues slipped to USD 953.7 million from $969.1 million in Q4 of 2005.

Mr Brett Harvey CEO termed the 4th quarter results as solid particularly in light of the impact the mild weather has had on coal inventories at power plants.

Mr Harvey pointed to Consol's strategic acquisition of Mon River Towing and JAR Barge Lines in 2006 as an example of the company's diversification into the transportation portion of the energy supply chain.

Consol said that it would reduce capital expenditures by about one fourth and restrict coal production capacity increases to manage supply as recent industry overproduction has caused prices to slip from unprecedented sky high levels.

Mr Harvey expects to increase production by about 2 million tons for 2007, but to stick with our previously stated principle of not adding significant additional production capacity unless the market has already signaled the need through executed sales agreements. Capital expenditure and production discipline have been keys to our success in 2006 and we will continue to take this measured approach to expansion projects. We will continue to exercise discipline in our capital spending, particularly during the first half of 2007, as we see how the coal markets unfold this year."

Metals Insider reported that the Hellyer Tailings project in Australias Tasmania has scheduled its first shipment of concentrates for Jan 27th 2007. The shipment will include all of the projects concentrate production that has been transported to the port of Burnie as of that date, an estimated total of over 5,000 (wet) tonnes of bulk zinc concentrate, with an average grade of 38% Zn, 8.7% Pb and 228g/t Ag.

The shipment is two weeks later than expected due to feedstock zinc grades being initially lower than expectation, thus slowing production output for the same zinc grade of product concentrate.

Intec operates the project in a JV with Polymetals. Once fully on stream Hellyer will produce around 30,000 tonnes per year of zinc in concentrates.

Arch Coal Inc recently announced its Mountain Laurel mining complex earned top honors for reclamation excellence from the West Virginia department of environmental protection.

The release said that Engineering design and construction of the new Mountain Laurel complex utilized exemplary reclamation and drainage techniques to protect the environment and native wildlife. Mountain Laurel also convenes a community advisory panel, which meets regularly and promotes a common ground of understanding, communication and exchange on ideas of importance to the community.

Mr Steven F Leer chairman and CEO of Arch Coal said that "We are very proud of the extraordinary efforts the employees of Mountain Laurel have taken to build a state of the art mining complex that demonstrates our strong commitment to environmental care, safety and social responsibility. Our goal is to be a good neighbor at all of our operations."

Massey Energy Company last week announced that its Raymond Safety Program has once again been recognized on a national level for its effectiveness and creative approach toward promoting and rewarding Massey Member safety practices. This is the Raymond Safety Program's second consecutive national award in its 3 years of existence.

The program won a highly coveted Promotional Products Association International Golden Pyramid Award for the Employee Incentive category, which include programs that promote and recognize employees for a desired response.

Mr Don L Blankenship president & CEO said "Since we implemented the program company wide in 2004, we have been pleased with the positive impact safety as well as attendance. It has helped Massey Energy maintain a safety rating far better that the industry average."

The Raymond Program is named after Raymond A. Bradbury, retired past president of Martin County Coal, who coined the slogan "A safe mine is a productive mine." Under the Raymond Program, members are awarded points on an individual level, on their working team level and on their mine level. Those points may then be redeemed from a prize catalog containing prizes ranging from tools, toys, electronics, sporting goods, clothing and other items.

The PPAI has 23,000 member companies in the USA and selects winners each year for outstanding campaigns in a variety of promotion based categories.

Massey Energy Company, headquartered at Richmond in Virginia with operations in West Virginia, Kentucky and Virginia, is the 4th largest coal company in the United States based on produced coal revenue.