Kudremukh Iron Ore Company Limited plans to set up a 100,000 tonnes per year ductile iron spun pipe plant at Baikampady Industrial Lyaout at Panambur near Mangalore to produce ductile iron pipes in diameters ranging from 100mm to 1000mm.

KIOCL has invited a bid for setting up this plant. The scope of the work comprises design, engineering, manufacture, transportation, storage at site, supply, installation, testing & commissioning and performance guarantee tests of DISP plant including civil works, structural works, electrics, instrumentation, services and utilities on Lump sum turnkey basis. Project is to be completed within 20 months.

MECON Limited has been appointed as the consultant for the project.

KIOCL is currently operating 350 cubic meter capacity blast furnace complex at New Mangalore Port for production of pig iron and the proposed location for the pipe plant is adjacent to it.

According to advance estimates of national income from the governments Central Statistical Organization, continued buoyancy in manufacturing and services will see the Indian Gross Domestic Product grow by 9.2% in 2006-07, highest ever in the history. These numbers come a week after the government revised 2005-06 GDP growth from 8.4% to 9%.

The % change over the previous year is estimated as under

Mr P Chidambaram finance minister said We are happy to note that the estimate for GDP growth at constant prices is 9.2%. This is particularly gratifying because it is upon a base year growth of 9% in 2005-06.

Local media has reported that Jharkhands high court has cleared the handing over the land deed for 30,000 acres of Steel Authority of India Limiteds Bokaro Steel Limited. It has directed the state government to submit before it the draft for the land deed within 15 days and complete the deed within a month in connection with settlement of land dispute with BSL.

The division bench presided by Justice DK Sinha posted the matter for further hearing on February 22nd 2007.

The state government filed an affidavit submitting that it was ready to hand over the deed for conveyance to the BSL and BSL filed an affidavit submitting that it would pay the compensation amounting to INR 65 crore.

Indias Central Electricity Regulatory Commission has issued guidelines for grant of permission to operators wanting to set up and operate a power exchange in the country, without stipulating a cap on the number of exchanges that can be set up by prospective players. Promoters would be required to develop their own power exchange model and seek permission from the CERC before the start of the operation

Mr AK Basu chairman of CERC said "The Commission seeks to encourage the power exchange to emerge as a market based institution for providing price discovery and price risk management to the generators, distribution licensees, traders, consumers and other stakeholder.

Mr Basu said "About four players have already intimated us on their plans for setting up an exchange. We expect at least one exchange to be up and running by the end of the year.

While the promoter would have the freedom to develop, manage and operate the exchange in accordance to the rules and procedures, the CERC will look at aspects such as prevention of speculation, collusion and unfair gaming and adjudication of disputes between the exchange and the members.

BL has reported that Indian Railways plans to earn INR 1700 crores during 2006-07 by selling various types of scrap up by 21% YoY as compared to INR 1365 crores in 2005-06 and up by 64.7% as compared to INR 1032 crores in 2004-05.

In order to ensure a more transparent auction of scrap, Indian Railways is also moving towards e auction and a pilot project for e auction was successfully done in Southern Railways. It is reported that e auction is likely to be adopted in other locations soon.

The scrap sold regularly by Indian railways through tenders or public auctions include used rails, unserviceable items, condemned machinery & plant and rolling stock including wagons, coaches and locomotives. As per report Indian Railways sells about 12,000 to 16,000 wagons, 1,200 to 1,300 coaches and 50 to 100 locomotives every year.

As per reports, during 2005-06, 40% earnings accrued from the sale of other ferrous material which includes worn out parts, junk from workshops, 37% from the sale of rails and permanent way including rails, sleepers & joints, 12% from the sale of worn out rolling stock, 7% from the sale of non ferrous scrap and the rest from miscellaneous scrap sale.

Paradip Port Trust is planning to float tenders for construction of a new berth for iron ore exports and another one for coking coal imports on BOT basis at a cost of INR 900 crores to be completed in 2 to 3 years to increase PPTs capacity by 20 million tonnes.

Mr K Raghuramaiah chairman of PPT while addressing members of the Federation of India Export Organization said that the financial burden on the port would be much less because of the PPP route to be followed adding that the tenders will not be global tenders.

Mr Raghuramaiah informed that the port's traffic volume of 27.93 million tonnes has been achieved during April to December period and would touch the level of 38 million tonnes in 2006-07 as compared to 33 million tonnes in 2005-06, with iron ore and coal accounting for about 12 million tonnes. He added that the traffic was projected to increase to 48 million tonnes in 2007-08 with the bulk of the increase coming from crude segment.

Local media has reported that Jharkhand Government is going to enquire into the working of coal companies, which have exceeded their area of operation and has asked all the subsidiaries of Coal India Limited operating in the state to furnish the details about their land acquisition.

Mr Dulal Bhuiyan revenue minister of Jharkhand said that the state government had information overlapping in the leasehold areas by the different coal companies, which was allotted for the mining purposes where the companies are not paying any additional revenue for extra land.

UK based power investment firm Globeleq, amidst media reports of it pulling out of Sasan, said that the ultra mega power project does not feature in the company's restructuring program and that it is not selling assets, which are at a developmental stage.

Globeleq said "Currently, Globeleq's operating power businesses are for sale. Our various development projects in Africa, America and Asia are not included in that sale process."

The reports of Globeleq possibly exiting from the Sasan project were fuelled after the company decided to pull out of emerging markets as part of its restructuring program and appointed Lehman Brothers investment bank to carry out the transactions.

Globeleq and Lanco Infratech in a 70:30 JV had recently won the 4,000 MW Sasan ultra mega power project in Madhya Pradesh by quoting a tariff rate of INR 1.196 per unit. Indian government has issued the letter of intent to the consortium and the last date for the submission of the letter of acceptance is February 28th 2007.

It is reported that the Southern India Mills Association is planning to set up a 500MW imported coal based power project in Tuticorin at an estimated cost of INR 2250 crore to find a permanent solution to the unscheduled power tripping and excessive power tariff in Tamil Nadu.

Mr SV Arumugam chairman of SIMA said the proposal is to have a group power plant' in which SIMA will have 51% equity that have enough takers for the balance equity where banks and financial institutions are very keen on extending term loans as the producer is also the consumer.

Mr Arumugam told a press conference that the textile mills in Tamil Nadu have been facing severe power shortage in the form of frequent power cuts leading to an average annual production loss of INR 800 crore. The power cuts last for a minute to over 500 minutes and the number of cuts goes to 60 to 80 daily. Mr SV Arumugam said that the textile industry consumes over 1300MW currently.

The total approximate revenue earnings of Indian Railways on originating basis during the period April 2006 to January 2007 were INR 50563.83 crore as compared to INR 43806.35 crore during the same period last year, registering an increase of 15.43%.

Revenue earnings in INR crores
Change is with respect to April 2006 to January 2007.

ThyssenKrupp Steel AG and ThyssenKrupp Stainless AG plan to jointly build a new plant in the US at a cost of EUR 2.3 billion and after extensive preliminary investigations, the site selection process is now being concentrated on the states of Alabama and Louisiana after Arkansas which was also under investigation as a possible location but proved less suitable.

Mr Peter Urban vice chairman of ThyssenKrupp Steel's executive board said that "Arkansas made an excellent proposal and has many important and valuable attributes for business development. However, based on criteria we developed after much study, we are moving forward with Alabama and Louisiana at this time."

The central element of the new plant will be a hot strip mill which will be used primarily to process slabs from the new ThyssenKrupp CSA steel mill in Brazil. In addition there will be cold rolling and hot dip coating capacities for high quality end products of flat carbon steel with total annual capacity of 4.5 million tons of end products at an investment of EUR 1.8 billion.

In addition, ThyssenKrupp Stainless plans to build a plant to manufacture stainless steel flat products. A melt shop will turn out up to 1 million tons of slabs per year which will be rolled on the hot strip mill. A cold rolling facility is also to be erected which, in the first phase, will be designed to produce 325,000 tons of cold strip and 100,000 tons of pickled hot strip. Around 340,000 tons of the stainless hot strips produced on the hot strip mill will be used to supply the ThyssenKrupp Mexinox cold rolling facility at San Luis Potosi in Mexico. The volume of investment by ThyssenKrupp Stainless is expected to be EUR 500 million.

Market price for Chinese hot rolled steel has extended strong gains while stepping into 2007 mainly supported by recovery in domestic steel market across the board. But market participants are concerned that staggering new capacity addition to come on stream may cloud the prospect of further price rise this year based on the bitter lesson learned from past years when booming capacity expansion has severely depressed market price.

The data shows that some 100 million tons of fresh HR capacity have been put into operation last year, with 140 million tons estimated to come on stream in 2007. According to incomplete statistics, 12 new HR lines are expected to operate within this year, with a designed capacity of 38.8 million tones per year. The list includes

1. Anyang Steel's 4 million tones per year 1780 line
2. Magang's 5 million tones per year 2250 line
3. Baosteel's 4 million tones per year 1880 line
4. Tiantie's 3.8 million tones per year 1780 line
5. Ningbo Jianlong's 4 million tones per year 1780 line
6. Beitai's 4 million tones per year 1780 line

HR steel supply data sourced from National Statistics Bureau covering HR sheet, HR wide and thin strip and HR medium and thick strip shows that Anyang, Magang and Baosteel plan to operate the new HR lines with a combined capacity of 13 million tons in the first half of this year, taking up by 33.5% of the total fresh capacity. Wuhan, Tiantie, Guofeng and Haixin are to run 11.8million tons of fresh HR capacity representing 30.4% of the total in the Q3 of this year. The remaining 36.1% capacity would start to run in the year end, thus, would have limited effect on the market supply within this year. The actual HR steel supply is expected to add by some 18 million tons this year, a YoY increase of 26.4% from the year before, slower than 32.4% recorded last year.

To what extent the new capacity would transfer to additional supply depends on two major factors.

1. There is time lag before the new lines achieve full capacity. Domestic HR steel capacity has registered peak growth in 2005, with total HR steel capacity climbing by 27 million tons or 49.9% from a year earlier to 81.15 million tons. By contrary, domestic HR steel supply rises only 36.1% YoY to 51.92 million tons in the corresponding period.
2. Rapid growth of CR steel output would put a drag on fresh HR steel capacity growth. Last year, domestic CR steel output rose by 51% YoY to 26.05 million tons, 18.6% points higher than that of HR steel.

The NSB statistics show that China's HR steel supply expands by 50.9% in 2004, 36.1% in 2005 and 32.4% in 2006 respectively, 27.4, 12 and 8% points higher than the pace posted for comparable steel output.

The fundamental balance of supply and demand is one of the factors affecting market trends, apart from production costs, market sentiment, import & export status and international market movements etc.

(Sourced from Mysteel.net)

AFP has reported that Japan is considering joining the United States in filing a WTO complaint against China over its industrial subsidies

Mr Akira Amari minister of economy, industry & trade of Japan said "When I visited the United States in January, US Trade Representative Mr Schwab told me about things of that nature and we are asking for detailed and concrete information from the Chinese side. Based on our findings, we hope to decide as soon as possible whether to join as a third party.

The US government last week filed a complaint at the World Trade Organization against China. The United States alleged that China subsidies for steel, paper, information technology and other industries make Chinese goods artificially cheap and prevents US companies from competing fairly. US Schwab last week invited the European Union and Japan to join the WTO case.

China is Japan's largest trade partner, with Japanese companies depending on it as an industrial base and increasingly as a market for consumer goods.

Interfax reported that Ukraine's international trade commission completed an antidumping investigation against imports of iron ore concentrate from Russia without imposing antidumping measures

The commission said in a statement. that "Over the period of the investigation imports into Ukraine of iron ore concentrate originating from Russia were conducted not at dumping prices and that these imports did not affect the operations of domestic producers."

The Ukrainian Economics Ministry said it would give up to 60 days for consideration of written comments and information with respect to the anti-dumping probe, and 30 days for interested parties to come forward and request hearings.

The commission opened the investigation on January 31 last year following a complaint by Ukraine's Inhulets Mining and Beneficiation Plant.

Inhulets claims that Russia has been dumping concentrate in Ukraine at RUB 790 per tonne DAF at the Ukrainian border while the same concentrate has been trading at an average of RUB 1209 a tonne EXW in Russia where the ore has been sold for RUB 419 a tonne less in Ukraine than in Russia, and such imports can be treated as dumping. The Inhulets mining company claimed that the dumping imports grew 39% in 2005 and that they affected the enterprise's performance, because its own output and sales of the same commodity fell by 8% and 7% respectively. The company's inventory soared by 90% and the sale price of its concentrate fell by 22%.

Zinc producer Zinifex Ltd said that a recovery in zinc prices back to the record levels seen in the December quarter will largely depend on whether Chinese producers continue to export the metal.

Mr Greig Gailey CEO of Zinifex during a mining industry meeting in Melbourne said that the fall in zinc price to the current level of around USD 3,220 per tonne from an average of USD 4200 on the London Metal Exchange over the December quarter, was mainly due to Chinese export during the quarter end propelled by the difference in Chinese domestic prices and LME prices, finding way into the Singapore LME warehouses.

He said further recovery in the price will now largely depend on the actions of the Chinese producers and whether they will continue to export. He added that "Much of the arbitrage which existed between Chinese domestic pricing and LME has now evaporated thus reducing the incentive to export

Mr Gailey said supply and demand fundamentals still look very positive for the metal in the short to medium term and LME zinc stocks still remain at historically very low levels. He said We don't see this situation changing quickly and the price outlook depends on demand being sustained and the industry not oversupplying the market.

BHP Billiton has announced that a USD10 billion increase to the USD 3 billion capital management programme that was announced in August 2006. This amount will be returned to shareholders over the next 18 months through a series of buy backs.

BHPB said that the next stage in the capital management program will be the implementation of an off market buys back with a targeted maximum of AUD 3.25 billion of BHP Billiton Limited shares. At the same time, BHP Billiton will continue to repurchase shares on market in BHP Billiton Plc on an opportunistic basis.

BHPB release said This program continues BHP Billitons outstanding track record of meeting its capital management commitment and delivering value to shareholders. This increase of the capital management program is in addition to the increased interim dividend.

Mr Don Argus chairman of BHPB said that The increase in the Companys capital management programme reflects the Boards continued commitment to generating long term, sustainable shareholder value. The Board of BHP Billiton continues its absolute commitment to capital discipline. Our confidence in the Companys outlook and strong cash generative capability has underpinned our decision to continue to announce sizeable returns to our shareholders.

Mr Argus said that "Our financial strength means we are well positioned to fund our USD 17.5 billion pipeline of projects and capture other value enhancing opportunities as they arise. At the same time, we are able to maintain a robust capital structure and continue with our progressive dividend policy, as well as undertake this additional USD 10 billion return to shareholders."

Xinhua reported that North China's Shanxi Province, the country's largest coal reserve, has produced 580 million tons of coal last year registering YoY growth of 7 % over 2005.

Shanxi government officials said that almost 466 million tonnes of coal was sold to other provinces and regions of China, bringing Shanxi province CNY191 billion in sale revenue.

State owned enterprises accounted for 52 % of the production and produced 34.7 million tons more than during the previous year. Small mines in towns and villages that were often blamed for fatal accidents reported a decline of 6.69 million tons.

Latin America's largest steelmaker Gerdau SA, has announced that its consolidated sales revenue amounted to BRL 27.5 billion up by 7.2% as compared to BRL 25.6 billion recorded in 2005. In dollar terms, sales revenue was up 17.4% to USD 12.9 billion due to the 8.7% rise in the value of the Brazilian real against the US dollar. In 2006, physical sales of steel products were up 9.4% YoY to 14.8 million tonnes. As a result, production of slabs, blooms and billets grew by 13.9% to 15.6 million tons, with rolled products up by 17.7% YoY to 12.7 million tonnes.

Gerdau sales on the Brazilian market totaled 4 million tonnes up by 12.6% YoY over 2005 mainly as a result of growth in civil construction. In North America, sales totaled 6.7 million tonnes up by 5% YoY with steel production totaling 6.8 million tonnes up by 8.1% YoY and rolled products totaling 6.5 million tonnes up by 5.7% YoY. In 2006, the units in Argentina, Chile, Colombia, Peru and Uruguay sold a total of 1.5 million tonnes, representing an increase of 92.8% YoY.

Mr AndrGerdau Johannpeter CEO said The Gerdau Group will continue to build on its strategy of being an agent of consolidation in the steel industry, seeking acquisition opportunities in a range of markets. The challenge is to boost competitiveness and scale in such a way as to ensure growth with profitability, market leadership, and operation in diverse sectors of the steel industry and presence in a range of countries.

In 2006, the Gerdau Group invested US$ 2 billion, half in expansion and upgrading of existing mills and the other half in acquisitions. The main investments in increased production capacity took place as part of the ongoing expansion at Gerdau Aminas (state of Minas Gerais), from 3 million to 4.5 million metric tons per year, and in the construction of the rolling mill at Gerdau S Paulo (state of S Paulo), which has been completed. During the year, acquisitions totaled USD 1 billionFour companies were purchased in the United States: Callaway Building Products, Fargo Iron and Metal Company, Sheffield Steel and Pacific Coast Steel and one in Peru (Siderperu), together with a 40% stake in Corporaci Sidenor of Spain. Corporaci Sidenor also assumed control of the Spanish steelmaker GSB Acero.

In the next three years, the Gerdau Group plans to invest USD 4 billion: USD 2.4 billion in Brazil and USD 1.6 billion in other countries. These funds will go towards ongoing expansion of production capacity and technological upgrades, as well as new projects to be approved over the next three years. This sum does not include investments in acquisitions. With these investments, the Gerdau Groups steel production capacity will grow from 19.2 million to 21.6 million tons per year. With over 60% of the investments being made by 2009, the units in Brazil will have capacity boosted by 14%, from 9.2 million to 10.6 million tons. In the other countries, the increase will be about 10%, from 10 million to 11 million tons.

The European Commission announced that it has decided to refer part of the proposed acquisition of steel scrap processor TSR by Cronimet, Remondis and Alfa Acciai to the German competition authority and has approved the remainder.

EC in a statement said that it has referred certain aspects of the acquisition for examination under German national competition law, as the deal threatens to affect competition significantly in certain scrap markets in Germany. The notified operation does not give rise to any competition concerns in the European Economic Area other than these aspects, and the Commission has therefore approved the rest of the deal under the EU Merger Regulation.

According to the EC the buyout of TSR threatens to seriously affect competition on the regional markets for the collection of carbon steel scrap in the Ruhr area and for the collection of alloyed steel scrap around Stuttgart where there are considerable overlaps between parties, the EC said. Due to JV with other leading market players, considerable structural links would be created on these markets.

The German authorities decided the transaction could affect competition and asked the Commission to refer this part of the decision on the concentration to them. This provision of the regulation allows the Commission to partially refer a case when a concentration threatens to affect significantly competition within a Member State, which presents all the characteristics of a distinct market.

Alfa Acciai produces concrete reinforcement bar and reinforcing steels, Cronimet is a trader of ferrous scrap for use in steel production, while Remondis is active in water and recycling management. TSR trades and processes scrap for the steel industry.

Finland based steelmaker Rautaruukki saw its fourth quarter pretax profit more than double as it enjoyed buoyant demand for steel and industrial construction materials and said it is optimistic strong earnings growth will continue going into 2007.

In EUR millions
OP is operating profit
PBT is profit after tax
TOT is total
COM is comparable

The release mentions following highlights for Q4 of 2006 as compared to Q4 of 2005

1. Marked growth in comparable net sales and operating profit, operating profit was 16.5% of net sales as against 14.3%
2. Divestment of Ovako was completed, tax-exempt capital gain of EUR 100 million
3. Major growth in volume of construction deliveries
4. Engineering customers report strong order books
5. Good demand for standard and special steel products
6. Record steel production
7. Acquisition of AB Omeo Mekaniska Verkstad strengthens capability to deliver boom products

Mr Sakari Tamminen president & CEO said Demand held up well in our core market areas throughout 2006, with particularly strong growth in Central Europe, Russia and Ukraine. Construction activity was extremely brisk in commercial and industrial construction in Eastern Europe. Engineering customers reported strong order books. Standard and special steel products continued to be in good demand and prices firmed up towards the end of the year. The company posted excellent results and is almost debt free.

Russian mining equipment manufacturer Uralmash-Izhora Group is all set for a repair worth USD 56.5 million and capital expenditures to the same amount in 2007 following decisions by the companys investment committee as against USD 28.2 million in capital expenditures and USD 1.1 million in scientific and research engineering developments in 2006.

Approximately 70% of total investments will be spent on improvements to metallurgical facilities and a further USD 56.5 million is to be spent on repairs to metallurgical processing and assembly equipment. The company is also planning to complete current investment projects and to raise investments in OMZ production facilities development and modernization by more than 50%.It intends to begin construction of a DSP 120 arc steel smelting furnace at OMZ SpecStal.

In 2007 the company will continue research on production related to new mining equipment development including ESH-15.90V and EKG-3000 excavators, DK-2000 extraction complex and crushing and milling equipment. The company will also develop new production technologies and will improve existing technologies.

OMZ is one of the largest heavy industry enterprises in Russia. It specializes in engineering, manufacturing, sales and maintenance of plant, equipment and machinery for the nuclear power industry and also producing special steels and providing industrial services. The company comprises the divisions of OMZ NPPEQ, OMZ- Spetsstal, OMZ-MINEQ and OMZ Uralmash-Promuslugi, located in Russia at Uralmash and Izhorskiye Zavody and in the Czech Republic at Skoda Steel and Skoda JS.

Corus worker Mr Peter Clement, one of the survivors in an explosion in Corus steelworks furnace that killed 3 workers and injured 12 men in November 2001, has won an undisclosed 6 figure payout. The explosion in 2001 destroyed BF No 5 lifting it off its base and blasting out 200 tonnes of steel slag and hot gasses after leaking water caused the blast.

Mr Clement acknowledged Corus had admitted liability for the accident early on but he said reaching this final settlement has been a difficult battle. He said "It's been a very frustrating five years, and I understand it could have taken a lot longer had I contested the compensation that they gave me. He said he felt very bitter towards Corus.

Mr Clement described the moment of the fatal explosion. He said "I was standing on the cast house floor about 10 meters away from the furnace itself when I heard an almighty explosion. At the moment you sort of hear the bang I could feel myself being lifted up off the floor and flying through the air in a ball of flames. My shoulder was broken, my ribs were broken and I had what they call blast inhalation, which was breathing in the toxic fumes.

A Corus spokesman said "Our thoughts will continue to be with the families who lost their loved ones and those who were so tragically affected by the accident. At the earliest possible stage, Corus made a full admission of civil liability as our priority was to provide the necessary support to the injured and bereaved. However, the process to settle the claims is specific and confidential to the individuals and is being handled by our insurers and where claims remain to be settled, interim payments have been made."

Interfax reported that Shanghai based Bengang Steel Plate and Angang Steel Co Ltd dismissed speculation about their merger despite a Hong Kong media report that the two will merge early next year.

After year long negotiations, Xinxing Pipes has recently signed contract with Spain to supply 90000 tons of ductile cast iron pipes to Spain. Spain's OHL will transport them from Llanura Manchega to Daimiel

The first stage of project requires about 90000 tons of DN800, DN1400, DN1600 and DN1800 ductile cast iron pipes, to be supplied by Xinxing Pipes.

(Sourced from MySteel.net)

West Perth based GVM Metals Limited announced that it has agreed terms for the acquisition of UK based Kelso Mining Limited whose principal asset is the right to acquire 70% of the issued share capital of Coal of Africa Limited. The terms of agreement contain a number of preconditions including regulatory and Kelso shareholder consent and the completion of due diligence as well as the precondition to the JORC and SAMREC status of the resources. The transaction is to complete 90 days after South African Ministerial consent to the transfer of New Order Mining Title.

The acquisition of Kelso requires the approval of GVM shareholders. Once final agreements have been executed, a Notice of Meeting will be sent to GVM shareholders providing full details of the acquisition. This is expected by no later than 31 March 2007.

CoAL is a South African company that owns the Mooiplaats coal project and surrounding New Order prospecting rights. The properties owned by CoAL are located within 2 kilometers of the Camden Power Station near Ermelo and are beside the main rail line to the Richards Bay export coal terminal. A Competent Persons Report on the CoAL properties is currently being prepared by SRK Consulting and it is a condition of the Kelso acquisition of CoAL that the CoAL properties contain a JORC and SAMREC compliant resource in excess of 450 million tonnes of coal. The CPR is expected to be made available by April 2007.

Kelso also owns the Itawes nickel project located in the northern Mindanao province in the Philippines. Whilst the Mineral Production Sharing Agreement is expected to be granted by the Department of Environment and Resources shortly, GVM will have the right to sell the Itawes project back to the Itawes vendors for a nominal consideration.

West Perth based mining company Sphere Investments Ltd has completed a USD 1.86 billion pre feasibility study on its Guelb el Aouj iron ore JV with Societe Nationale Industrielle et Miniere at Mauritania in West Africa.

Sphere Investments said Progress to date has been very encouraging, and the project partners have already moved to a Definitive Feasibility Study in order to complete a bankable study. Many of the key work activities are already well beyond the PFS stage.

It said Completion of the resource definition drilling reported to JORC code requirements. Sufficient measured of 188 million tonnes and indicated 313 million tonnes resources were defined to provide 178 million tonnes proved ore reserves and 294 million tonnes probable ore reserves underpinning 30 years of production. Completion of preliminary mine planning confirms a favorably low life of mine waste to ore strip ratio of 1.1 to 1.

Japanese marine transporter Nippon Yusen Kabushiki Kaisha has agreed to a 24 year charter contract with BaoSteel Co Ltd for the transport of iron ore from Brazil to Majishan in China.

Under the agreement, NYK will transport 800,000 tons of iron ore each year during the first 4 years of the contract with shipments beginning from the end of 2007. For the subsequent 20 years of the contract from the middle of 2010 NYK will use a new 300,000 ton bulk carrier built by Nantong COSCO KHI Ship Engineering Co Ltd for the transport of 1,200,000 tonnes of iron ore each year.

This contract will be the 4th long term contract of more than 1 year between NYK and Bao Steel. NYK had previously concluded three long term charter contracts with Bao Steel for the transport of iron ore to China.

Around 50 million tonnes outdated coking capacities including coke from beehive oven, primitive oven and small machine were closed over recent years, with 30 million tonnes up taken by Shanxi province. In 2006, some 10 million tonnes was forced out, involving Shougang No 2 coke oven, Shanghai coking No 1 oven, Beijing coke chemical plant, Wuhan Steel No 1 oven and Taiyuan Chemical Group's two small ones, as well as more than 30 mills in Inner Mongolia and another batch in Shanxi Province.

Meanwhile, construction of large size new capacities picked up. In 2006, 56% of the new built capacity is taken by 6 meter tall oven and the rest are above 4.3 meter tamping type. Yunzhou minging, Taigang and Magang 7.63 meter large ovens were put into operation and the first 5.5 meter tall tamping type oven also came on stream. There is still another group at Wuhan Steel, Benxi Steel, Anshan Steel and Handan Steel etc in the pipeline.

Analysts say China will have a 13% growth in coke output this year, taking the total up to 310 million tons. This is based on: first, coke from beehive, primitive oven and small machines may revive capitalizing on moderate stance of the local government and stirred market, despite reinforced elimination efforts. Second, for hiked quality requirements and unbroken transport bottleneck, integrated steelmakers will strengthen building of supported facilities to existing coke oven. Third, crude steel output in China and the world still grows, rendering coke demand.

Analysts also say coke export volume will be flat this year. The ministry of commerce just issued 2007 qualified coke exporters, reducing 70 to 60, but reportedly the export quota will remain some 14mt. First, the export volume will not expand given curbs on high energy consuming and high polluting resource products. Second, China's coke has good reputation on the international market by high strength and reactivity. Moreover, if China exports much less, the overseas steelmakers may face severe fuel shortages and consequent political problems the Chinese government may find hard to deal with.

Regarding the market, observers say the coke producers are gaining powerful pricing strength since April 2006. On the basis of market movements and led by the local industrial association, Shanxi coke enterprises often take the lead in price hike, followed by producers of other provinces or regions. Hebei Province has also taken the road of collective pricing by setting up Hebei coke industry association. The association called to raise the local ex-works by CNY 20 per ton from January 1, on top of last year end price.

Shanxi Province lately decided to hike coke price by CNY 50 per ton further from February 1, at the heels of January CNY 30 per tone rise, mainly boosted by amounting coal price and waxed development fund costs at the coal enterprises, etc. Consumers are however discontented with consecutive price rise and the analysts believe in great possibility of the hike.

(Sourced from MySteel.net)

According to a survey from a French shipping consultancy worlds top 10 carriers enjoyed a combined global market share of 60% in 2006 up by 21.7% as against 49.3% in 2000. The top 10 carriers combined fleet size had risen from 2.54 million TEUs to 6.28 million TEUs over the period.

The report shows that the worlds top three ocean liners, Maersk Line, MSC and CMA CGM, have increased their collective global market share from 32.4% to 33.1% in 2006 in terms of TEU carrying capacity. This compares to a combined market share of 23.7% on January 1st, 2000, for the three leading container shipping companies, which back then were Maersk Sealand, Evergreen and P&O Nedlloyd.

Maersk Line commanded the largest global market share of 16.8% at the beginning of this year, down from 18.2% a year ago. The experts attribute this downturn to the integration difficulties Maersk faces with P&O Nedlloyd. Both MSC and CMA CGM are said to have strongly strengthened their positions, with MSC raising its global market share from 8.6% to 9.5% in 2006. CMA CGM increased its share from 5.6% to 6.5% during the same period.

The report added that "It looks like the size and coverage extent of these two carriers give them more confidence in the future than smaller carriers and they are probably in a better position to sustain lower rates, thanks in part to economies of scale and through distinct commercial flair. It will allow them to drain cargo from smaller competitors and to continue growing faster than the rest."

Algoma Steel Inc reported net income of USD 50.4 million for the October to December 2006 quarter as compared to net income of USD 59.5 million in the Q3 and USD 55 million in theQ4 of 2005. Its EBITDA for the Q4 was USD 64.2 million compared to USD 112.3 million in the Q3 and USD 77.6 million in the Q4 of 2005.

Algoma said that the decrease from the Q3 was due mainly to lower volumes, which declined 88,000 tons or 14% and lower average steel prices that declined by USD 53 per ton. In the Q4, cash and short term investments decreased by USD 34.2 million primarily due to an additional USD 85 million of pension funding in the quarter.

Mr Denis Turcotte, president and CEO of Algoma Steel Inc said that "As expected, the fourth quarter was full of challenges as inventory rationalization at the service centers and high imports resulted in softer market conditions and a corresponding reduction in volumes and lower steel prices.

He added that We remain cautiously optimistic going into 2007 as there are early indications that service center inventory levels are beginning to decline with both volumes and pricing responding accordingly."

Interfax reported that the ISTIL mini steel mill in Donetsk announced that it raised production of finished roll 45% YoY in January to 87,000 tonnes and that its crude steel production grew by 49.1% YoY to 85,000 tonnes.

ISTILs production of finished roll increased by 17.3% YoY to 863,000 tonnes in 2006 and it produced 920,000 tonnes of steel up by 13.4% YoY.