Indias steel ministry has assured Steel Authority of India Ltd all help and changes in the rules to facilitate SAILs plans to buy steel companies abroad as well as in the country apart from increasing its production capacity.

Mr Ram Vilas Paswan union minister of steel while speaking on the occasion of the district dealers' conference said that SAIL is exploring the possibilities of buying steel companies and go in for joint ventures abroad. This will start a new innings for SAIL.

Mr Paswan said that steel ministry had initiated moves to help SAIL go in for foreign bids. Mr Paswan said "The existing rules put certain limitations on SAIL when it comes to buying foreign companies. But we plan to amend the rules and it requires cabinet approval to enable SAIL to do so.

Mr Paswan hinted that a SAIL team might go abroad to study the potential of buying steel companies without disclosing the name of the company and country concerned.

Mr Paswan said that SAIL would invest INR 1 trillion for expanding its capacity to 40 million tonnes by 2020 as against its current production capacity of 14.6 million tonnes.

TATA Steel has revised the companys production target from 30 million tonnes per annum to 100 million tonnes per annum by 2015 through a mixture of acquisitions as well as Greenfield and Brownfield projects.

Mr B Muthuraman MD of TATA Steel amid celebrations in Jamshedpur said that the new target signifies the groups ambitions in the global steel market and would most certainly pit it against the worlds largest steel maker Arcelor Mittal for future acquisitions.

Mr Muthuraman said that while too many acquisitions could result in loss of advantage from raw materials sourcing, only Greenfield projects could mean a dearth of capacity. He said So, we have to balance both. We would roughly keep a 50:50 balance.

However Mr Muthuraman clarified that 100 million tonnes per annum by 2015 was a moving target and it may be 2018 or 2020 or even earlier.

According to industry experts the denial of infrastructure status to coal mining industry would have serious repercussions on planning and extraction, which could eventually affect power generation and steel production in the country. With the liberalization of mining and opening up of coal blocks to the private sector, new technologies and extraction methods are required and coal mining sector would be able to make the big leap only if the industry gets the benefit of industry status.

Industry expert said that the Indian coal mining industry is nearly 200 years old and so far only the easily accessible coal at the surface has been mined, either via opencast techniques or shallow underground mines and coal deposits deep under the ground are yet to be tapped.

The experts said most of the coal lying locked in unexplored blocks deep down in the earth needs new methods of exploration and extraction that can be funded only by the private sector. At the same time, the low output per man shift, especially in underground coalmines, is a drag on the coal sector. Even long wall mining and other measures that have been remarkably successful in China have met with limited success in India.

The experts said the finance ministry, instead of rejecting the demand for industry status, should design a special package to boost underground mining.

During an interview with Financial Times, Mr Ratan Tata chairman of TATA Group said that Corus UK operation would be made more profitable post acquisition and did not give make assurance on protecting jobs there.

Mr Ratan TATA said the company would apply to Corus the lessons it had learnt from upgrading its 100 year old Indian plant, which it has transformed into one of the steel industry's highest margin producers. He said "Our plan would be to try to make the UK operations more profitable.

Mr Ratan Tata said that so far only due diligence has been done on Corus and it is yet to examine the Coruss plants in detail. He said therefore "I would not even attempt to do so because it would be wrong of me to give those assurances or to deny that that was so. But I would say that we are not a company that would first look at jobs.

Tata's comments come after Britain's largest steel trade union, Community, demanded a meeting with the tycoon seeking assurances he will remain committed to expanding Corus after his successful bid.

Mr Ram Vilas Paswan union minister of steel has announced that Steel Authority of India Limited will adopt five villages in Bihar to develop them as Steel Villages and develop these villages with proper utilization of steel to provide amenities in these villages.

Mr Paswan said ''The decision has been taken to propagate the use of steel. India was far behind the other developed nations in terms of consumption of steel as their per capita consumption was 500 to 700 kilograms while in India it was merely 35 kilograms. Per capita steel consumption in Bihar is pathetic low at 7.5 kilograms which required to be increased with support from private as well as private sectors."

Mr Paswan said that 200 bullock carts made of steel would be provided to the farmers. He said "The distribution would be made through the agriculture department."

Business Line has reported that Usha Martin will commence captive coal mining within the next 6 months to complete companys raw material linkages as it is already operating captive iron ore mines and power generation units.

Mr P Bhattacharaya JMD of Usha Martin said that the forging of linkages to coal, iron ore and power would have a positive impact on the companys bottom line and that t linkages to iron ore requirements have already helped the company cut input costs.

Mr Bhattacharaya said that the company was in the process of making a capital investment of INR 13.5 billion in logistics, minerals and power distribution, in increasing the steel production capacity to one million tons, in value addition to the product mix and in strengthening the companys global distribution and marketing network.

He said The Company would continue to focus on becoming the largest wire rope company in the world and it aims to achieve 1 million tons steel production three years from now 50% of which would be value added by the company itself.

Telegraph reported that Japan may offer a USD 2 billion loan for the Delhi to Calcutta and Delhi to Mumbai phases of the railway freight corridor project.

As per reports, Japanese International Cooperation Agency are doing their own assessment of the project and have submitted an interim report on the project that involves an investment of Rs 20,000 crore but the exact details of investments would be known only after the it submits final report in October 2007.

The report cites a senior railway official saying that Indian Railways is inclined towards a debt equity ratio of 2:1 for the special purpose vehicle to implement the project and that Indian Railways would contribute INR 5,400 crore equity, which may go up if financial institutions do not pick up their share of the equity.

The Japanese want the long term loan to have backward linkages with their own economy and want to ensure that this railway project in India will boost industrial production and employment in Japan. Japanese technology and equipment would help Indian Railway embrace the new technological paradigm required for the project.

Rail India Technical and Economic Services have prepared a detailed feasibility report.

Paradip Port Trust has drawn up a major expansion plans to increase its installed cargo handling capacity of 51.4 million tonnes to 106.4 million tonnes by 2011-2012 by adding 8 berths within 5 years, 2 for coal and one each for containers and fertilizers, 2 for export of steel products and another two for multi purpose cargo. RITES are carrying out the feasibility study for these berths.

Mr K Raghuramaiah chairman of PPT on the sidelines of an interactive session organized by Federation of Indian Export Organization said The estimated capital expenditure for these eight additional berths is INR 1,478 crore. This will be set up on a private public partnership model. The PPT will contribute INR 300 crore for setting up these berths. We will help the private partner create the necessary channels that are important for setting up a berth.

PPT has also submitted an INR 253 crore plan to the ministry of shipping for setting up an alternative channel for hassle free cargo movement. Mr Raghuramaiah said At present, PPT is able to handle vessels of 75,000 tonnes. But with this new channel, our port will be able to allow entry of large vessels of 125,000 tonnes. We will provide one third of the project cost.

Indian government decided to pump in INR 723 crore to revive HMT Machine Tools Ltd through a JV route and also provide funds for a voluntary retirement scheme.

Mr P Chidambaram finance minister of India while briefing newspersons after the meeting of the Cabinet Committee on Economic Affairs which cleared the restructuring package said that out of the total amount being pumped in by the government INR 443 crore will be in the form of preferential share capital and INR 180 crore by fresh equity capital and another INR 100 crore through a special non plan loan for the VRS.

He said "With the restructuring of the company its balance sheet including the debt equity ratio will improve. The restructuring will also result in reduction of the accumulated losses while critical manufacturing facilities will be upgraded.

TATA Power Company Ltd has posted a profit after tax of INR 2799 million for the quarter ended December 31st 2006 up by 22.9% YoY as compared to INR 2276.5 million for same period last year. Its total Income has decreased from INR 14013.3 million for the quarter ended December 31st 2005 to INR 12464.9 million for the quarter ended December 31st 2006.

Mr Prasad Menon MD TATA Power said "The company has consolidated its leading position in the power sector with the recent winning bid for the Mundra Ultra Mega Power Project, with the inking of the Chhattisgarh MoU, and several other projects at various stages of implementation across the country, the Company is poised to acquire a significant national footprint and assume a steep growth trajectory. Our track record of steady project implementation and superior service augurs well for our consumers and various stakeholders moving forward."

GVK has announced the consolidation of its infrastructure assets in power, airport, road and mining into GVK Power & Infrastructure Ltd and making it an integrated infrastructure player. Mr GV Krishna Reddy chairman of GVK said that "The consolidation will align all our infrastructure companies under one roof enabling GVK to position itself as an integrated infrastructure company to leverage emerging opportunities."

The boards of directors of GVKPIL and Green Garden Horticulture Private Ltd agreed to the amalgamation. Bowstring and Green Garden hold equity stakes in various power and infrastructure projects of GVK. The scheme of amalgamation envisages a share exchange ratio of 133 GVKPIL equity shares of INR 10 face value each for every 4 Bowstring equity shares of same face value. It also proposes a share exchange ratio of 153 GVKPIL equity shares for every 4 Green Garden equity shares. It has pegged an exchange ratio of three GVKPIL equity shares for every 40 shares of GVK Industries Ltd.

Accounting firms Deloitte Haskins & Sells and Dalal & Shah had been appointed to recommend the final share exchange ratio on April 1st 2006.

GVKPIL owns 54 % in GVK Industries which operates the 216 MW Jegurupadu Phase I gas based power plant and the 220 MW Jegurupadu Phase II gas based project. It also owns 45 % in the 464 MW gas based Gautami Power plant. Now Mumbai International Airport Private Ltd which operates the Chhatrapati Shivaji International Airport in Mumbai and GVK Jaipur Expressway Private Ltd will come under GVKPIL.

The US lodged the largest trade complaint against China at the World Trade Organization alleging that the Asian nation unfairly subsidizes its steel, wood products, information technology and other industries.

Ms Susan Schwab US trade representative said that China uses its basic tax laws and other tools to encourage exports and to discriminate against imports of a variety of American manufactured goods, in describing the complaint in Washington. She said China's industrial subsidies are prohibited by its 2001 agreement to join the WTO.

This action is the first step in what may be a lengthy process to determine whether China's subsidies violate WTO rules. Now the two countries must try to negotiate a solution and if those talks fail, US may ask WTO to arbitrate. If the WTO rules for the US, China would have to remove the subsidies or face US penalties on its exports and if China wins, it could keep the subsidies.

China now has 60 days to respond to the complaint before the U.S. can request a panel of WTO trade ministers to hear evidence and reach conclusions in the case. The whole process may take a year and half.

In the first 11 months of 2006, the US trade deficit with China surged to USD 213.5 billion, representing almost 30% of the total US shortfall from USD 185.3 billion in the same period a year earlier.

It is reported that the upgradation of Australias Geraldton Ports berth 5 to cater for the needs of Mid West iron ore exporters is on track for completion later this year and shipments from berth 5 should begin later this year. Geraldtons iron ore facility at berth 4 is in use 80% of the time, so a new berth will speed ship turnarounds and save costs for exporters and purchasers.

Ms Alannah MacTiernan planning and infrastructure minister said that since September last year, the Geraldton Port Authority had awarded contracts totaling AUD18.5 million to advance the project. These contracts include

1. AUD 8.3million for modifications to berth 5
2. AUD 5.6million for a new ship loader with a capacity of 5,000 tonnes per hour, and numerous smaller procurement contracts.

Ms Alannah MacTiernan said We are very aware that this level of production would also require improved rail and unloading facilities and increased storage at the port, so the Port Authority has initiated detailed studies of these needs. However, to support the business case for new facilities, the Port is asking mining companies to guarantee their tonnage forecasts with take or pay contracts. The State Government will not hurry to commit public funds without the appropriate commitments from users.

Miners forecast their annual production of hematite to grow from 5.5million tonnes per annum in 2006-2007 to 13.2million tonnes per annum in 2010-2011, with at least four iron mining companies Mount Gibson Iron, Midwest Corporation, Gindalbie Metals and Murchison Metals using the port.

China's Shanxi Coke Industry Association has increased its reference prices for coke by CNY 50 per tonne as of February 1st 2007 as a result of cost increases after it adjusted its reference prices upwards by CNY 30 per tonne one month ago. The reference sales price for second grade coke in Shanxi is around CNY 1,200 per tonne on a delivered to Hebei province's Tangshan area basis up from CNY 1,150 per tonne in January.

An official with the Shanxi Coke Industry Association said that coal companies in Shanxi now have to pay about CNY 40 per tonne as fees for environmental management in the region which has pushed up their costs. The official also revealed that coke producers are also complaining of cash flow problems and experiencing difficulties paying coal suppliers and state owned railway companies which usually require upfront payments.

Meanwhile an official with the Hebei Coke & Chemical Industry Association notes that it has not yet made a decision whether to increase its coke reference price in line with that in Shanxi.

Shanxi Coke Industry Association, whose members account for two thirds of Shanxi province's total coke output, convenes member meetings from time to time throughout the year, to discuss and adjust the reference price for coke. Producers and steel mills then negotiate contract prices on an individual basis, but the sales price must not be less than the agreed reference price. This is to stop fierce competition and to prevent producers from undercutting each other with very cheap coke supply. If mills are unwilling to accept prices, the association may call for its members to cut supply to the mills in question.

American Institute for International Steel revealed that as per preliminary data, USs steel imports declined by 12.6% in December 2006 from November 2006 but finished the year at record levels. USs total steel imports achieved record levels in 2006 of 45.3 million tonnes and finished steel imports accounted for 35.9 million tons.

According to year to date figures imports increased by 40.9% YoY to 45.3 million tonnes as compared to 32.1 million tons in 2005 and semi finished imports increased from 6.9 million tons in 2005 to 9.3 million tons in 2006 at a 34.6% increase.

The details of imports from various countries is as under

In 000 short tons
Source AISI

Xinhua reported that China expressed regret over USAs move to lodge a complaint at the World Trade Organisation over alleged industrial subsidies, calling the move a pity.

A commerce ministry spokesman said over the weekend said "It's a pity for the United States to seek the consultation process at the World Trade Organization. The spokesman said authorities in Beijing will be deliberating the US case, adding that the two sides had "kept bilateral contact over the issue all along.

The European Bank for Reconstruction and Development is providing a USD 150 million loan to CJSC Ekoenergia, a special purpose company owned by Industrial Union of Donbass and Calyon Bank is underwriting the syndication of a USD 50 million part of the loan.

The project will finance the construction of a 303MW cogeneration facility, owned and operated by Ekoenergia, at Alchevsk Iron & Steel Works, which will use waste gases produced by AMK and coke oven gases produced by Alchevsk Coke Works. The cogeneration facility is expected to produce enough electricity each year to meet the demands of a region like Poltava.

The facility will generate electricity by utilizing waste gases from the production process and therefore will significantly reduce the emissions of greenhouse gases in Ukraine. According to the preliminary estimates this investment in its first four years will reduce annual AMK carbon emissions by 6 million tonnes.

Mr Olivier Descamps EBRD Business Group Director for southern and eastern Europe said that the facility will be one the first of its kind in the FSU and its successful commissioning will have a strong demonstration effect on other energy inefficient enterprises by working with one of the highest profile industrial groups in Ukraine.

According to a semi annual report on the metals industry, Metals: Industrials Industry Survey, published by Standard & Poor's Equity Research, a leading provider of independent investment research while 2006 was a year of strong earnings growth for the US steel industry, it does not see similar growth prospects for the industry in 2007. Earlier ICRA had reported an equally disconcerting 2007 outlook for the steel industry.

S&P said that a number of factors would contribute to a decline in demand for steel in 2007 including a slower growing US economy, a 2% to 3% decrease in demand from the US auto industry versus an estimated 9% gain in 2006 and a decline in shipments to distributors and original equipment manufacturers compared to a projected 4% gain in 2006.

Mr Leo Larkin a senior metals and mining analyst said that. "Many of the steel industry's clients are sitting on excess inventory that will take a good portion of the first half of the year to work through. Additionally, the industry is highly leveraged to the US automotive manufacturers, several of which may cut production. When you factor all of this together, it adds up to our negative outlook on the industry."

However Mr Larkin added "The lone bright spot for the industry is non residential construction, but that one market won't be able to offset weakness in other markets in 2007."

Finished steel export offers from China continued to go up last week while semis offers were suspended due to swift rise in domestic market prices.

The change of FOB Chinese port prices with respect to previous week are tabulated below

In USD

HRC - SS400 HRC export offers are prevailing at USD490 per tonne FON while S235JR or S275JR material goes at USD 500 to USD 505 per tonne FOB. Overseas customers have gradually recognized the market trend and buying activities are improving accordingly.

HR plates - Export prices are firm and some mills continue to raise their quotations, bolstered by strong overseas demand. Major plate makers are offering its SS400 plate at USD 550 per tonne FOB, S275JR at USD 590 per tonne FOB and S355JR at USD 600 per tonne FOB for April shipment. But there is great gap between different mills on quotations. There are also small plate maker who is offering at around USD 535 per tonne FOB for S275JR and USD 545 per tonne FOB for S355JR.

HDG - Export offers are prevailing at USD 720 to USD 730 per tonne FOB. The escalating cost, strengthening market conditions and good export achievement are believed to be the reasons why steel makers raise export offers again. Also the strong expectation of export tax rebate cut is also an important factor. But traders told MySteel that they have made few deals at USD 720 per tonne and up as overseas market prices have not been growing as fast as Chinese export prices. In fact, transaction prices are between USD 680 to USD 700 per tonne or even lower. Some steel mills are even quoting USD 670 to USD 680 per tonne FOB for 1.0mm in 150 grams coating.

Wire rods - Export offers continue to climb up. Steel makers have raised Q235 wire rod to USD 420 per tonne FOB and up.

(Sourced from MySteel.net)

Mr Werner Mueller CEO of RAG has rejected calls by North Rhine Westphalia's state government head Mr Juergen Ruettgers for German coal mining activities to cease in 2014.

Mr Mueller told Bild Zeitung that 2014 is not acceptable to me. I have full faith in the heads of the CDU and the SPD and I hope that they are able to push through the compromise.

The ruling coalition of left and right parties hammered out a compromise agreement to cease all subsidies to the country's 8 remaining coalmines by 2018 as mining coal in Germany is 3 times more expensive than importing it from abroad.

The RAG industrial conglomerate operates Germany's remaining coalmines.

Xinhua has reported that investment on fixed assets in China's iron and steel sector reached CNY 260.3 billion (USD 33 billion) in 2006.

Mr Luo Bingsheng vice chairman of China Iron & Steel Association terming it as excessive said that the growth of the investment has slowed down significantly to 0.81% YoY in 2006 and is 23.69% points lower than the growth of the national total investment on fixed assets.

Mr Luo however warned iron and steel enterprises that the country's production capacity has outstripped market demand which emphasis of investment has shifted to high end projects to produce more value added products.

China produced 418.78 million tons of crude steel last year, a rise of 18.48 % YoY, and its production of pig iron was 404.17 million tons, increasing 19.78 % YoY where its apparent consumption of crude steel amounted to 384.05 million tons in 2006 accounting for 30.98 % of the global total. China also became the world's largest stainless steel producer last year with an output of 5.3 million tons, up by 67.68% YoY.

American Iron and Steel Institute has welcomed the decision by the Office of the United States Trade Representative to file a WTO case against the government of China for its continued use of WTO prohibited export subsidies.

Mr Andrew G Sharkey III president and CEO of AISI said that "This filing while significant only touches the tip of the iceberg of the full range of subsidies being provided to steel and other manufacturing industries in China. An essential and urgently needed next step is to ensure that US countervailing duty law will be applied in an effective manner to counter the trade and market distorting impacts of subsidies provided by China and other non market economies."

It is reported that Shougang Groups Caofeidian will come to operation in November 2008, but before that, Shougang Group will further cut steel production in Beijing and that the group will phase out 4 million ton capacity permanently within this year.

Mr Zhu Jimin chairman of Shougang said that currently the group possesses annual capacity of 8.2 million tons in Beijing, half of which will be eliminated by the end of this year to protect the environment and meanwhile it has spent CNY 220 million in environment management.

The move started in 2005. Shougang stopped its 900,000 tonne per year No 5 blast furnace in June 30th 2005, reducing sulfur dioxide emission of 48 tons every year. The elimination of No. 2 coke furnace on May 9th 2006 brought down sulfur dioxide emission of 0.24 ton, fume emission of 4 tons and dust emission of 189 tons every year.

(Sourced from MySteel.net)

Chinese National Development and Reform Commission have given approval for Magang Group Holdings to build an iron ore plant in central Anhui province.

Magang has set up the Luohe Iron Ore Mining Company in conjunction with a local company Lujiang Longqiao Mining at 55:45 JV. Production from Magang's existing iron ore mines is dwindling and the new project is designed to secure the company's raw material supply.

The deposit located in Lujiang County in China's eastern Anhui province has inferred reserves of 340 million tonnes of iron ore. The project is designed to produce 66% Fe concentrate at a rate of 3 million tonnes per year in the first phase and 6 million to 8 million tonnes per year in the second phase.

NDRC in a statement posted on its website said the Luohe iron ore project has a total investment of CNY 1.1 billion and will produce 3 million tonnes of raw iron ore per year and 983,100 tonnes of refined iron ore.

BNamericas reported that Mr Pedro Galdi investment analyst with Brazils ABN Amro Real Corretora said that international slab prices are due to average USD 450 per tonne to USD 470 per tonne in 2007, flat compared to the previous year but could slip before midyear due to low demand in the US forcing Brazilian slab makers to look for others markets such as southern Europe.

Mr Galdi said that the "Prices could decline in the start of the second quarter, probably by some 10%. But the scenario remains positive." He explained that the prices would pick up during the third quarter. However, the analyst does not foresee a price decline in Brazil, Latin America's biggest steel producer.

However, Mr Galdi does not foresee a price decline in Brazil. He said "The country's economy is recovering, with incentives for the civil construction sector. Demand is likely to remain strong."

It is reported that Caparo Groups wholly owned subsidiary Caparo Precision Tubes Limited has acquired 100 % share capital of Hayes Tubes Limited of UK. However it is subject to certain conditions being satisfied and should these conditions be fulfilled, completion which is expected by the end of next month.

Mr Angad Paul CEO of Caparo said "Hayes is a long established manufacturer of Precision Tubes in the West Midlands and its activities will complement those of Caparo.

This acquisition is in addition to the recent acquisition completed by Caparo's subsidiary Caparo Engineering India Private Limited in January 2007 of the sheet metal businesses of International Auto Limited.

It is reported that 19 bodies out of total 32 killed in a coalmine explosion have been recovered by crews battling dangerously high levels of methane gas in northeast Colombia.

Mr Fernando Rosales director of civil defense in Norte de Santander state said initial efforts to remove the bodies trapped more than 1,300 feet underground by Saturday's explosion were hampered by toxic gases in the makeshift mine. Mr Rosales said "Luckily the conditions have improved greatly and the recovery operation is moving more fluidly adding that 19 bodies had been recovered so far from the mine in the remote hamlet of San Roque 255 miles northeast of Bogota.

Mr Rosales said 31 miners died in the mine while another managed to escape after the blast but died at a hospital in Cucuta capital of Norte de Santander.

German trade union IG Metall's North Rhine-Westphalia is seeking a 6.5% pay increase for union members at this year's wage talks. IG Metall's board of governors will take a formal decision on the matter on Feb 26th. Wage talks are scheduled to begin next month.

Mr Detlef Wetzel head of IG Metalls North Rhine-Westphalia told Weltam Sonntag newspaper that The talks and the resolutions are still ahead of us but that is the exact opinion which I have observed.

Spiegel magazine earlier reported that there is a consensus among all IG Metall regional heads to call for a 6.5 % without saying where it obtained the information.

Sandvik Tooling has announced that it reached an agreement with the American private equity company Littlejohn & Co LLC to acquire US based Diamond Innovations Inc, formerly the Super abrasives Division of General Electric. The acquisition is expected to be completed during the first quarter of 2007.

It is reported that Coruss rail welding operation at Mossbay in Workington have been extended by a month until the end of April due to further delays in setting up a welding facility as part of the new Corus Rail Service Centre at Scunthorpe, which will use welding plant that is currently being relocated from Castleton by using the services of Workington engineering firm Tubros.

The Workington welding operation is part of the process of keeping Network Rail supplied with 108 meter lengths of rail which is being rolled by the French Corus plant at Hayange in eastern France in 36 meter lengths and shipped to Workington.

Network Rail will be supplied from Scunthorpe but by the time it is ready to roll and weld at full capacity of more than 10,000 tonnes of French rails will have been imported.

Corus closed down the rail making plant at Mossbay in August last year with the loss of 250 jobs. Trade unionists said it is more evidence that the Workington mill was closed at least 8 months prematurely.

French nickel producer Eramet said that the disruption to its operations in New Caledonia caused by a protracted general strike late last year when mine workers who blockaded two of the company's 4 mining pits cost it nearly 6,000 tonnes in lost production.

Eramets Doniambo plant produced 62,383 tonnes of both ferronickel and nickel matte last year up by 4.7% YoY over 2005 levels when production was also hit by strike action mainly due to rise in Doniambos capacity to 75,000 tonnes per year.

Eramet said it is now looking forward to resuming the ramp up towards that new capacity figure but actual output this year is forecast at only 65,000 tonnes due to the depletion of ore reserves during the strike and the planned repair work on two ore calcining furnaces. Actual deliveries of nickel product are expected to be some 2,000 tonnes below that production level in order to rebuild inventories that fell to an unsustainably low level during the strike last year.

Eramet is the world's 5th largest nickel producer processing ore from four pits at the Doniambo smelter near Noumea.

Reuter reported that China's Valin Steel Tube and Wire has announced that it is planning to place shares with two of its largest shareholders Hunan Valin Iron & Steel Group and Arcelor Mittal without disclosing the size of the placement.

A Valin official told that Valin plans to use proceeds from the new offer to finance a steel plate project. He said that "Details of the private placement are still under discussion."

Mittal Steel paid about USD 310 million for a minor stake in Valin in 2005. As of September, Mittal Steel held a 29.48% stake in Valin, which has a total market value of USD 1.56 billion.

Mr Alan J Carpenter premier of Western Australia announced Australias Government funding of AUD 9.5million for a major dredging project for Port Hedland harbor covering dredging works and the design and costing for the new facility at Utah Point to alleviate increasing congestion at the port and meet the growing demands of current and future iron ore and other mineral producers.

Mr Carpenter said This project will prepare the harbor for handling large Panamax bulk carriers at a proposed new multi user minerals berth. The project will cut a berth pocket 300 meters long by 60 meters wide and 14 meters deep. The new berth will have an initial capacity of more than 7.2 million tonnes per annum, adding to the 6 million tonnes per annum currently available at the ports existing common user berths. This could produce revenue for the Port Authority of more than AUD 30 million each year.

The Premier said the timing of the funding approval would allow the Port Authority to secure a dredge already working on another project in Port Hedland, saving more than AUD 18million in costs.

In the year to the end of June 2006, Port Hedland port, which includes the massive BHP facility, handled the largest tonnage of any port in Australia, recording total trade of more than 110.6 million tonnes.

Mr Hernan Martinez Torres of Colombian mining and energy minister told an industry conference in Miami that it expects to boost its coal production to 102 million tons in 2010, up from a projected 72 million tons this year, but added that that will require significant port, road and railway improvements already under way and continued progress against illegal armed groups.

Mr Torres said "The aim of this is to make Colombia the most competitive internationally. Colombia exports nearly all of its coal, mainly to Western Europe and the United States, and is expanding railroads linking mining regions with its Caribbean ports of Bolivar and Santa Marta.

He said the areas where mountains make railroad expansion impractical, Colombia has signed contracts for road building projects aimed at eliminating major coal transit bottlenecks over the next three years.

Mr Torres informed that upgrades at Colombia's Caribbean ports of Cartegena, Barranquilla, Santa Marta and Bolivar would raise their combined coal handling capacity to 102 million tons from the present 76 million annually and on the Pacific Coast, the lone coal handling port of Buenaventura is being deepened and the port of Aguadulce would be adapted for coal shipping.

Chinas ministry of railways announced that its railway transportation volume accounted for a quarter of the world's total last year, with only 6% of global operational railway mileage.

Mr Wang Yongping a spokesperson of ministry of railways said that China beat all other countries in passenger and cargo traffic by railway last year, with its passenger turnover hitting 662.2 billion person kilometers and freight turnover reaching 2.87 billion ton kilometers. The general railway turnover also topped the world with a total of 2.86 trillion ton kilometers, 130 billion ton kilometers more than that of the United States and one and a half times that of Russia.

China has only 76,600 kilometers of railways in operation, making the density of its railway transportation the largest in the world. Although China's railways have the highest efficiency of transport, they still lag far behind the nation's economic and social development."

According to British business researcher Economist Intelligence unit Russia has become the worlds 10th largest economy in terms of gross domestic production in 2006, up by four notches from 14th in 2005 as its GDP at USD 986.6 billion in 2006 increased by USD 223.3 billion over 2005 outperforming Brazil, Korea and India.

Mr Dmitry Medvedev first deputy prime minister of Russia recently said that the nations GDP topped USD 1 trillion and it will become the worlds 6th largest economy, overtaking Italy, France and Britain in two years.

The Bank of Russia on January 17th 2007 said that the nations foreign exchange reserves reached USD 303.9 billion for the first time, making it the worlds third largest foreign reserve owner. China and Japan hold the largest and second largest foreign reserves in the world. Taiwan and Korea are the worlds fourth and fifth foreign reserve possessors.

Russia attracted the largest ever foreign investment of USD 4.16 billion last year up by 278% from the previous year.

Russias rapid economic growth is driven by brisk exports of oil and natural gas and it is expected to become the worlds largest oil exporter in 2007 beating Saudi Arabia.

Chinese geologists have discovered large mineral deposits on the Tibet railway and the government is planning to spend USD 3.7 billion for exploration of these deposits.

Mr Meng Xiani director of the China Geological Survey has revealed that 16 large copper, lead, zinc, iron and crude oil deposits along the railway are expected to yield 18 million tons of copper and 10 million tons of lead and zinc.

CGS believes the copper reserves in Quolong could reach 18 million tons, making it the largest copper deposit in the country. One copper deposit on Qulong has a proven reserve of 7.89 million tons, second only to the countrys largest copper mine in Dexing in Chinas Jiangxi Province. 3 major copper deposits in Qulong and in Yunan Provinces Pulang and Yangla regions will add 26.78 million tons of copper to Chinas reserves increasing total mined copper output by almost a third.

Chinas copper miners currently produce about 600,000 tons of copper annually. The nation imported another 731,200 tons of refined copper from January to November last year.