JSW plans 30 million tonnes capacity by 2020

JSW Steel has decided to increase its overall production capacity to 30 million tonnes by 2020 from the current level of 3.8 million tonnes to meet the rising demand in the country.

Mr Sajjan Jindal vice chairman and MD of JSW said that it plans to set up Greenfield projects of 10 million tonnes each in West Bengal and Jharkhand by 2020 and boost the capacity of its existing plant at Vijaynagar in Karnataka to 10 million tonnes by 2010. Mr Jindal said that these 2 units will come up in phases with 3 million tonnes to be added every three years.

He added that "After 2010, we will have capacity of 10 million tones, which will generate enough cash to fund the further expansion. We are expecting to get the mining lease in the next 6 to 8 months. Once the mining lease rights are given, we will firm up our financial plan to fund these projects." JSW has already started the first phase of its expansion to increase its capacity to 6.8 million tonnes in Vijaynagar, entailing a total capital expenditure of INR 5,300 crore and is expected to be completed by 2009. Simultaneously, the company has decided to add another 3.2 million tonnes of capacity at the same place.

Mr Jindal told that "JSW is not looking at acquiring major assets outside India as the domestic market offers tremendous opportunities."

Chattisgarh CM accuses for inciting land trouble

IANS reported that Dr Raman Singh chief minister of Chhattisgarh has accused the Communist Party of India of inciting tribal villagers against 2 proposed steel plants and retreated that his government is committed to industrialization and will not relocate the projects.

Mr Singh told IANS that "The CPI, which is offering land to industries in West Bengal despite violent protests by land oustees, has stoked tension by provoking locals for violence in Bastar's Lohandiguda area where TATA Steel plans to set up an integrated steel plant. The same elements are whipping up sentiments and inciting tribals at Dhurli and Bhansi villages, the proposed site of a mega steel plant by Essar Steel. They have largely misguided innocent tribal farmers."

Mr Raman Singh said that "The Chhattisgarh government is committed to industrialization and working for improving the quality of lives of millions of decades old marginalized tribal population of Bastar. I am hopeful the government will persuade farmers to surrender land. Currently, there is no plan to shift the proposed steel plant venues of TATA and Essar in view of locals protest. The farmers are sensible enough to understand their interest. The land deadlock issue will have a peaceful solution soon."

Mr Singh added that this comes after 10 tribal dominated villages of Lohandiguda block under the Chitrakot assembly segment revolted against the government decision to acquire 5,098 acres of land for TATA Steels proposed million tonne per annum steel plant. There has also been strong resentment against Essar Steel that plans to acquire 1,480 acres of land for setting up a 3.2 million tonnes per annum steel plant at Dhurli and Bhansi villages in Dantewada.

Kamdhenu forays into structural steel through franchise

Kamdhenu Ispat Ltd announced that it has embarked into the production of structural steel, manufacturing various products in the segment such as angles, beams, channels and flats etc through strategic franchisee association.

KIL has entered into strategic tie up for manufacturing of the Kamdhenu brand structural steels with Venus Rolling Mills Pvt Ltd in Maharashtra, Shree Ambika Alloys in Punjab and Kundlas Loh Udyog in Himachal Pradesh. It has also entered into a franchisee agreement with Raika Ispat Udyog Pvt Ltd in Chhattisgarh for manufacturing of Kamdhenu brand binding wires.

Mr Satish Agarwal CMD of Kamdhenu Ispat Ltd said that "We have entered India's booming structural steel segment in association with our franchisee units based in Maharashtra, Punjab, Himachal Pradesh and Chhattisgarh. Kamdhenu's venturing in the structural steel segment is in the continuation of our vision to diversify into the core profile in the steel sector. The structural steel segment is growing on fast pace with the construction boom in the country. It is predicted that by the year 2011-12, the annual production capacity of the sector as a whole would reach 5 million tonnes. The scenario is optimistic for us."

He added that "The company expects production capacity to touch 300,000 tonnes per annum in the current fiscal and would further increase this capacity to 1 million tonnes in the next two three years. The move would help the company to take the total revenue from the Kamdhenu brand to INR 3,000 crore from the present INR 1,500 crore.

Kamdhenu has already established a successful model for manufacturing of reinforcement bars with its 25 franchisee units.

Bharat Forge to set up new Greenfield forging unit near Pune

The worlds 2nd largest forging manufacturer Bharat Forge has announced that it will enter the non automotive forgings business and set up an INR 350 crore Greenfield facilities with a production capacity of 30,000 tonnes per year facility at Baramati near Pune in Maharashtra. The new facility is expected to commence production in April 2008 and about 60% of the production at the facility will be for export purposes. The facility would be called Bharat Forge Centre for Advanced Manufacturing

Mr Baba Kalyani CMD of Bharat Forge said that the decision to enter the non automotive forgings business was part of a strategy to de risk the companys business and the additional capacities created will take the company closer to being the worlds largest forgings manufacturer and will manufacture 100,000 large crankshafts.

Mr Kalyani said that the new plant will focus on locomotive and marine engines, producing crankshafts up to 4.5 meters in length. Its next priority is the aerospace sector. Later it intends to look at the aero engine sector, gas turbines for the energy sector and lower end large construction equipment.

He added that the plant will house the worlds largest closed die casting facility, which will have a forging hammer of 80 tonnes and will handle large crankshafts of 4.5 meters in length and two tonnes in weight.

Arham Mangal to ink sponge iron MoU in Jharkhand

ProjectsToday reported that Arham Mangal is likely to sign a MoU with the Jharkhand government for its proposed 700 tonnes per day sponge iron plant in Saraikela in Saraikela Kharswan district of the state.

According to the report the proposed project is still in the planning stage with Kolkata based United Consultants in the midst of preparing the detailed project report and civil work is likely to begin by end of May 2007.

According to project officials, financial closure for the INR 50 crore projects is targeted for June 2007 and negotiations are currently under way with potential machinery suppliers.

It is noted that the new project faced a minor delay in implementation due to some changes in the Jharkhand government's policies concerning sponge iron plants in the state. Arham Mangal had filed an IEM for this project in May 2005 and according to original plans and had targeted to begin physical work on the project in January 2007.

Mr DC Garg takes over as CMD of CILs WCL

PTI reported that Mr Dinesh Garg has taken over as the new CMD of Western Coalfields Limited by succeeding Mr GS Chugg who retired on Monday.

Mr Garg while talking to PTI said that WCL has been accorded the status of Mini Navaratna by the coal ministry and his endeavor would be to take it to newer heights.

Mr Garg was director of another Coal India Limiteds subsidiary Bharat Coaking Coal Limited at Dhanbad prior to his appointment at Western Coalfields. He had earlier worked in WCL and Northern Coalfields Limited in various capacities.

Japan to complete feasibility study on dedicated freight corridor by October

A Japanese delegation led by Mr Tetsuzo Fuyushiba minister of land, infrastructure and transport government of Japan called on the union minister for Railways Mr Lalu Prasad. Mr R Velu minister of state for Railways, Mr Ramesh Chandra member electrical of Railway board and other senior officials were also present on the occasion.

Mr Lalu Prasad while welcoming the delegation said that the Indian government was committed to implementing all elements of India Japan Strategic and Global Partnership agreed to by the Prime Ministers of the 2 countries in December 2006 which included comprehensive economic partnership.

Mr Yadav while appreciating Japans support for the Dedicated Freight Corridors project said that this project would open the doors for the Delhi to Mumbai Industrial Corridor project and appreciated Japans efforts to expedite the feasibility study on the DFC expected in October 2007.

Mr Fuyushiba thanked the Railway minister for the warm hospitality and said that the feasibility study report on the DFC project will be completed by October 2007 and will be a comprehensive one covering technology and maintenance issues. He assured the Railway minister of Japans full cooperation in ensuring implementation of the project.

Mr Ramesh Chandra in his welcome address said that DFC project was a flagship project for modernizing Indian Railways and looked forward to close cooperation with the Japanese government.

Panchmahal Steel reappoints Mr Malhotra as MD

Panchmahal Steel Ltd has informed BSE that the companys board of directors at its meeting held on April 30th 2007 inter alia has re appointed Mr Ashok Malhotra as MD of the company for the period of 5 years with effect from April 1st 2007, subject to the approval of the members of the company.

Newcastle cuts coal shipping quotas

It is reported that Australia's Newcastle port has cut allocations for all producers for 2007 in a bid to ease severe ship congestion potentially driving coal prices higher in a tight Asian market.

Port Waratah Coal Services, operator of Newcastle Port, said in a statement recently that with the reinstatement of the capacity balancing system all producers received a reduced allocation for 2007 compared to what they originally requested.

Industry sources said the port operator has told all producers, to cut shipping output by between 18 and 20% in 2007. The source said the cuts in shipping allocations would slash Australian coal supplies and drive up thermal coal prices which have climbed to USD 55 a tonne from an average of USD 30 a tonne in 2005 based on trading platform globalCOAL's FOB prices loaded at Newcastle.

Another source said "The market is already very tight on bituminous coal so any further reduction in supply will not only drive up prices for Australian coal but also for Indonesian coal."

Japans March steel exports fall by 3.6% YoY

The Japan Iron and Steel Federation said Japan's steel exports in March down by 3.6% on year to 3.21 million tonnes marking the first decline in 11 months.

Exports to China are down by 1.3% on year decreasing for the first time in 10 months while those to South Korea dropped by 3% marking the first fall in 11 months. Exports to the US also shrunk 21.2% for the first time in three months. But exports to Thailand up by 1.1% YoY and those to Taiwan up by 7.7%, both up for the fifth straight month.

In tonnes
Source JISF

Severstals Q1 net income up by 65% YoY

Russian Severstal announced that its net income computed to Russian Accounting Standards increased by 64.6%, YoY in the Q1 of 2007, to RUB 9.34 billion (about USD 362 million).

At the same time, Russia's second largest steel producer said its Q1 net income declined by 19.6% compared to Q4 of 2006 due to lower operating profits during Q1 of 2007.

Average nickel content in SS on decline MEPS

MEPS reported that higher nickel prices are prompting buyers of austenitic stainless steels to actively seek alternative grades or other materials and the benefits of life cycle costing are diminishing. MEPS said that much of the substitution is taking place within the stainless industry but coated carbon steels are under consideration.

MEPS said that the ferritic steel of type 430 is becoming much more popular and lower nickel grades of 200 series are also taking off as mills around the world are now heavily promoting these as alternatives to the austenitic grades.

MEPS said that the stainless industry has reached a watershed and strong growth is assured but will be mainly through the promotion of the 200 and 400 series grades if nickel stays at recent elevated levels.

Stelco to increase profits by selling slabs in North America

According to Mr Rodney Mott CEO of Stelco Inc, Stelco will sell steel slabs to rivals in North American steel industry as part of a turnaround plan to boost its profit margins. Mr Rodney Mott in a conference call to discuss first quarter results told analyst that he believes Stelco can compete with international companies shipping slab to Canada from Brazil, Russia, India and the US.

Mr Mott said Stelco may not be able to compete on price but can offer reliability and proximity and is in a better position to build relationships with North American customers than steel producers in far flung locations. He believes that the company can easily ship small quantities, year round and would not require as much order lead time as overseas companies would.

Mr Mott added that one rival company that may need more slab steel soon is Algoma Steel Inc which two weeks ago struck a deal to be acquired by India's Essar Steel. Essar which appears to be positioning Algoma as a producer of pipe for the energy industry has also purchased Minnesota Steel, which could ship slab to Sault Ste Marie where Algoma is located.

Rios Coal & Allied to cut Hunter Valley coal output by 20% in 2007

Australian Coal & Allied Industries Ltd announced that it will cut coal production as its 3 mines in the Hunter Valley region of New South Wales by 20% in 2007 due to congestion at the port of Newcastle.

Mr Douglas Ritchie CEO of Coal & Allied said the cutbacks are unavoidable given the reduction in allocation levels. He said We need to reduce our total production in 2007 by approximately 20% to adapt to these revised allocation levels.

Mr Ritchie said the changes are being implemented to bring the miner's production levels into line with the reduced allocation of port and rail capacity made available to all users. But the current system of allocation and planning is clearly untenable. He said we are working with other parties involved in the coal logistics chain to develop a long term strategy to provide a more stable basis for industry to operate in.

He added that the production cuts will mean the loss of the equivalent of 250 contractor positions at its operations in Bengalla Mount Thorley Warkworth and Hunter Valley.

Coal & Allied Industries Ltd, 75 % owned by Rio Tinto, said that the move follows advice that the company's port and rail allocations will be reduced for the remainder of 2007.

Corus makes tender offer for outstanding notes on June 7th

Corus Group PLC announced that it is offering to repurchase all or any of the outstanding notes on June 7th 2007 at the repurchase amount.

Corus said that the repurchase amount is equal to 101% of the aggregate principal amount of the notes repurchased and a note holder will get EUR 1,023.75 for every EUR 1,000 principal amount of notes repurchased on the settlement date.

SA prompt coal prices weaken slightly Report

Reuters has reported that prices for prompt loading South African coal cargoes weakened slightly the past two days from last Friday because resilient high freight rates have caused buyers to back away from the market.

Traders and producers said there were bids at over USD 50 a tonne FOB Richards Bay for July and August loading Panamax cargoes of South African coal on Monday and earlier on Tuesday. But an offer at USD 48.50 a tonne for a June loading South African Panamax on electronic trading platform globalCOAL recently prompted buyers to withdraw their bids of USD 50 or more.

The report cites market sources as saying that the June loading Panamax had been offered at close to USD 50 recently but the seller dropped the offer price quickly to USD 49.00 and then USD 48.50. It looks like the seller is panicking because they're worried that the market is suddenly falling.

Geraldton Alliance study on infrastructure for mining growth in WA

A report commissioned by the Geraldton Iron Ore Alliance estimates that it will cost about USD 5.5 billion to set up the infrastructure needed to expand the mining industry in Western Australia's Midwest that includes the development of port and rail infrastructure power supplies and a slurry pipeline.

The study was carried out by Economics Consulting Services and assessed the economic impact, for the region and state, of seven Midwest developments in the process of expanding or investigating iron ore mining activities.

Mr Clive Brown chairman of Alliance said that the report identified the requirement for essential infrastructure to enable the projects to go ahead in a timeframe that would meet market opportunities. He said that "Opportunity that is there but it's not an opportunity that will last forever and is that time to seize that opportunity.

Mr Brown said most of the required capital would be funded by the private sector but the state government had a part to play. He said We are not saying the government has to come along and stump up USD 4.5 billion of the USD 5.5 billion that is necessary. He said "Obviously the state will have some responsibilities particularly in the south because the Geraldton Port is a multi user port and it's operated by the state.

Mr Brown noted there were still issues with the state government surrounding the proposed development of a second port Oakajee north of Geraldton to service expected increase in output. There are certain demands around portions of the assets but we haven't yet reached them all.

Mr Brown said the alliance hoped the study would be given a lot of weight by the government in considering the future development of the industry in the Midwest.

California Steel Industries Reports First Quarter 2007 Results

California Steel Industries Inc reported first quarter results for the period ended March 31st 2007. Its net income for the period is USD 1.3 million on sales of USD 314.7 million from shipments of 432,930 net tons of steel products. Its sales revenues of USD 314.7 million are slightly less than first quarter 2006. EBITDA for the quarter is USD 12.7 million.

Compared to fourth quarter 2006, net sales in the first quarter 2007 are about 2% higher than fourth quarter 2006's USD 309.4 million. Shipments are 6% higher in first quarter 2007 than in fourth quarter 2006 up from 409,749 net tons.

Tonnage sold is 12% lower as compared to the first quarter of 2006. Sales volumes are as follows

In net tons

Mr Masakazu Kurushima president & CEO said "First quarter was a challenge for CSI. While shipments were slightly better than fourth quarter 2006, continued high inventory levels at our customers, particularly at the service centers, have resulted in reduced order volumes and downward pressure on sales prices. However, the bright spot remains pipe sales, which continue at a very strong pace, one we believe will continue throughout the year.

California Steel Industries is the leading producer of flat rolled steel products in the western United States with a broad range of products, including hot rolled, cold rolled, electric resistant weld pipe and galvanized coil and sheet.

Turkey starts work on new oil pipeline

AP reported that Turkey has begun constructing a new 550 kilometer oil pipeline that is expected to carry Russian and Kazakh oil from its Black Sea coast to the Mediterranean. The new pipeline is scheduled to be operational by 2009 and alleviate the congested tanker traffic through the Bosporus Strait.

The new USD 1.5 billion pipeline is expected to connect the Black Sea port city of Samsun to the Mediterranean oil hub of Ceyhan the end point of two existing major oil pipelines carrying Caspian oil from Baku, and Iraqi oil from Kirkuk.

Turkey is also building natural gas pipelines to export Russian and Iranian gas to Europe. The US and many European countries support Turkey's pivotal role in diversifying energy supplies.

Longli Longteng cuts silicomanganese output

Platts reported that Chinese manganese alloy producer Guizhou Longli Longteng Ferroalloys has reduced its silicomanganese output by 1,000 to 2,000 million tones per month due to tightness in the manganese ore supply.

A Guizhou Longli Longteng official said that they had been largely reducing silicomanganese exports to only 1,000 to 2,000 million tones per month since January 2007 due to the supply shortage of manganese ore. The company mostly imports the material from overseas but the raw material has been tight since this year.

Longli Longteng runs a silicomanganese production facility with a capacity of 10,000 to 20,000 million tones per month and a 1,000 to 2,000 million tones per month medium carbon ferromanganese line and about 80% of company's output are for exports to Japan and Europe. The company has been the biggest spot silicomanganese supplier to the Japanese.

Praxairs CoJet system licensed to Nanjing Steel

Praxair has announced it has licensed its 100th patented electric arc furnace CoJet gas injection system to Chinese Nanjing Iron & Steel United Co Ltd.

Nanjing Iron & Steel is the 4th major Chinese steel manufacturer in two years to choose the CoJet system for electric arc furnaces. Once the installation is complete, Nanjing Iron & Steel will be able to use a predominately hot metal feed to refine into steel, thereby reducing energy consumption and eliminating the need for electric arcs entirely.

Mr Pravin Mathur director of Steel Business Development for Praxair said that "Although the CoJet technology was originally developed a decade ago, our leading edge design combined with our technological expertise still makes us the preferred supplier in the steel industry today and we continue to look for ways to improve this process, which includes researching alternative fuel sources."

The CoJet technology also allows steel manufacturers to quickly and easily remove carbon, in order to produce steel, from the hot metal feed by injecting a laser like supersonic jet of oxygen into the molten bath. They also say another benefit to using the CoJet gas injection system is that it can help minimize hot metal splashing in the furnace, which can damage the furnace roof and other parts if not properly controlled, while allowing even mixing of the molten bath.

Outokumpu sold its minority shareholding in Outotec Oyj

It is reported that Outokumpu has sold its remaining 12% shareholding in Outotec Oyj to institutional investors. The proceeds totaled some EUR 160 million.

As per report Outokumpu will book a non recurring tax free gain of EUR 142 million in the second quarter accounts, and the gain will be recorded in financial income in the income statement. Due to the fact that the shares have, as available for sale financial assets, been valued at fair value recognized in equity and deducted from net interest bearing debt, the effect of the transaction on the Group's total equity and gearing will be marginal. The transaction was arranged by Lehman Brothers.