TATA Steel and VSC ink MoU for steel plant study in Vietnam

PTI reported that TATA Steel has signed a MoU to form a 65:35 JV with Vietnam Steel Corporation to build a 4.5 million tonne steel plant at Vung Ang Industrial Zone in Ha Tinh province of Vietnam. VSC chose TATA Steel among a pool of potential partners that bid for the project.

The MoU will enable TATA Steel to extend an equity contribution of 30% in Thach Khe Iron Ore mining project and the proposed plant will be build over a period of 10 years. According to the MoU, TATA along with VSC will undertake a feasibility study for the steel project that will cost USD 3 million to USD 3.5 billion.

Mr Indronil Sengupta a TATA Steel senior official told PTI that "The MoU was signed between Mr B Muthuraman MD of TATA Steel and Mr Tau Van Hung president of VSC in Hanoi here this morning. We will also have a 30% stake in Thach Khe Iron Ore Joint Stock Company, which would undertake mining in due course of time."

TATA Steel already has a JV with VSC in rolling mills through its Singapore based unit Natsteel. VSC is a state owned company.

Indian CR makers call for export tax on HR

Times News Network reported that Indias the cold rolled steel manufacturers association CORSMA in a letter to the Mr Ram Vilas Paswan union steel minister has sought a 10% export duty on semis and hot rolled coils and reduction in customs duty from 5% to 2% to curb shortage of these goods in the domestic market.

Corsma said that India has surplus capacity for the production of finished steel. The shortages have arisen mainly due to the diversion of billets & booms and HR coils to the export markets.

CORSMA cited that many countries have taken fiscal and trade control measures in the overall interest of their manufacturing industries. It said China is producing around 450 million tonnes of steel but it has withdrawn all tax rebates and imposed a duty of 10% on export of billets and 5% on export of HR coils.

The report quotes as Corsma saying that the net availability of finished steel from domestic sources in 2006-07 was 39.64 million tonnes as against the actual consumption of 43.74 million tonnes leaving a gap of over 4 million tonnes which was to be met through imports. It added that small and medium enterprises could not import due to financial and operational constraints and the effective gap is 6 million tonnes.

CORSMA represents over 70 steel mills in the secondary industry in India.

JSL outlines its expansion plans

Indian SS major, Jindal Stainless Limited has undertaken capacity additions by adopting a strategy to increase existing capacities, Greenfield investments and establishing service centers.

Mr Ratan Jindal vice CMD of JSL Mr Jindal said that "We have embarked on an ambitious expansion plan, which would increase our capacity to 0.8 million tonnes per annum in the second phase. The total planned investments in this phase of the project are INR 5,600 crore." Mr Ratan Jindal added that JSL has already invested INR 2,250 crore during phase I which is nearing completion. During the first phase, JSL had commissioned ferroalloy plants, coke oven and power plants.

JLS is also in the process of enhancing production capacity at its Indonesia plant, PT Jindal Stainless, by more than two fold to 150,000 tonnes per annum from the present 65,000 tonnes and plans to invest around USD 35 million (INR 140 crore) in increasing capacity at the plant.

One of the strategies for JSLs operation is to open service canters. After running a successful center in Manesar, another centre near Mumbai is going to start in July 2007, followed by one in Chennai and Gujarat. JSL also plans to invest USD 30 million (INR 120 crore) in setting up three service centres in Europe and Mexico to meet enhanced demand from the export market. Mr Jindal said that "We plan to set up two service centres in Europe and another in Mexico to cater to the export market. The company invests about USD 10 million in setting up 1 service centre."

Jharkhand opposition question MoU signing spree

IANS reported that the opposition parties in Jharkhand are demanding a white paper on a deal signed between the state government and a firm, whose capital is reportedly less than the agreement's worth, to set up a steel plant in the state.

Mr Arjun Munda former chief minister said "Madhu Koda government has signed a MoU with a company whose capital is less than the amount signed. This MoU reflects that corruption is at its peak in this government. The government deal with Triangle Company is worth INR 3 billion. But the total capital of the firm is just INR500,000. This is a mockery of the people of the state. The government should have looked into the capital value and market reputation of the company. We demand high a level probe and a white paper on the MoU.

The report cites Mr Madhu Koda present chief minister as saying that he has ordered for probe into the MoU and that those guilty would not be spared

Mr Rabindra Mahto of the Jharkhand Mukti Morcha said the "MoU drama had started during the earlier NDA government itself and was continuing in the Unite Progressive Alliance as well. Another opposition party has demanded a white paper on all MoUs signed by both the NDA and the UPA governments as they feel that many MoUs were signed with non descript companies and people have the right to know the truth behind them.

In the last five years, the Jharkhand government has signed agreements with 64 companies in steel, mining, power and other sectors. The companies are to pump in INR 2.4 trillion into the state.

SECL to introduce short wall technology for underground mining

BS recently reported that Coal India Limiteds subsidiary South Eastern Coalfields Limited will introduce short wall mining technology in its facilities to increase its underground coal production. Initially SECL has planned to start the work from its Balrampur coal mining facilities in Sarguja district.

Mr BK Sinha chairman and MD of SECL said "The process of installing the equipment has already started. We have purchased some equipment from China. He said "We expect an increase of 10% after installing the short wall project."

As per report, SECL officials will be visiting Bilaspur soon to install the equipment and will also visit China for training to operation and maintain the equipment

SECL will be first coal mining major in India to install the technology used to extract coal having less than 1.5 meter thickness from the underground collieries.

JSW Steel kicks off CSR initiatives at Salboni in Bengal

It is reported that JSW Steel has started its corporate social responsibility initiative at Salboni in West Midnapore district of West Bengal before the acquisition of the 4,800 acres is completed. By presenting it as a socially responsible corporate entity, JSW Steel is probably ensuring a smooth transfer of the large track of land that it needs for the project.

Mr Biswadip Gupta joint MD and CEO of JSW Bengal Steel said that We had recently taken a team of medical doctors to Salboni along with local political leaders to set up a medical facility for this largely tribal dominated area and the initial response from the community was quite encouraging. As per reports, the medical facility would be built in the line of Jindal Sanjeevani Hospital at Bellary in Karnataka providing secondary and tertiary health care facilities with operation theatres and diagnostic departments.

Mr Gupta added that The JSW Foundation managed by Ms Sangita Jindal runs a major mid day meal program at Bellary and plan to launch a similar effort at Salboni.

Salboni, comprising of 53 villages with approximately 25,000 people, is the site of JSWs proposed 10 million tonne integrated steel plant at an investment of INR 35,000 crore. While about 4,300 acres are being acquired directly from the government, JSW Steel still needs about 560 acres, which it has to buy from the villagers through direct negotiations.

Indian Railway to set up wheel plant at Bela in Bihar

It is reported that Indian Railways East Central Railway is undertaking construction of a INR 1.57 billion wheel manufacturing plant at Bela Village in Dariapur block of Saran district in Bihar.

The project includes steel melting shop, moulding room, wheel finishing shop, mould repair shop, administrative workshop structures, stores depot and staff canteen.

As per report, ECR, which cancelled the previous tender, plans to float a fresh one as it intends to combine civil and electrical works with mechanical work as a single package.

Bharati Shipyard to build high tech PSVs for Man Ferrostaal

Bharati Shipyard Ltd has recently announced that it has secured an INR 418 crore order for supply of 2 platform supply vessels from Man Ferrostaal AG of Germnay. The contract value of each vessel is EUR 38 million. Bharati Shipyard said that this will be the first time that this type of PSV with Voith Schneider propulsion unit is built in Asia and that currently there are only three such vessels in operation worldwide.

Bharati Shipyard is to carry out the detailed engineering for the vessels in its in house design center. The 105 meter vessels will be diesel electric and fitted with two sets of Voith Schneider cycloidal propeller units at the stern. Classed with Germanischer Lloyd, they will have a free running speed of 17 knots, a cargo deck area of 1,400 square meters and a 2,500 tonnes Deck load.

Mr PC Kapoor MD of Bharti Shipyard said Its a momentous occasion for us and a milestone for the Indian shipyard industry, as the entire engineering design for these first of the PSVs to be built from Asia, will be carried out in house by Bharti Shipyard engineers. The order reflects our unique expertise and the high confidence that we at Bharti Shipyard enjoy from our global customers. Our total order book, now stands at Rs. 3,554 crores, comprising of 41 vessels.

Jharkhands R&R policy to come out soon CM

Mr Madhu Koda CM of Jharkhand said that the Jharkhand Government would soon declare its Rehabilitation and Resettlement policy. Mr Koda while speaking to media persons after reviewing the state of execution of various social development schemes said that the draft policy was in its final stages.

He said "The delay was mainly due to incorporation of fresh suggestions made by ally parties that have bee pressing to make the policy more people friendly."

Mr Koda said with regard to other commitments like constitution of the common minimum program and coordination committee of the UPA the job to accomplish the task had been assigned to the leaders of the United Progressive Alliance.

NTPCs 1st 500MW unit at Sipat synchronized

National Thermal Power Corporation Ltd announced that a 500 MW unit of its Sipat Super Thermal Power Project Stage II located in Chattisgarh has been successfully test synchronized on May 27th 2007.

This is the first unit that has been commissioned in respect of Sipat Super Thermal Power Project slated to have an ultimate capacity of 2980 MW.

With the commissioning of this unit, the total installed capacity of NTPC has become 27904 MW.

Indian Railways April earnings up by 8.78% YoY

As per a railway official release, Indian Railways has earned INR 3,619.92 crore from freight traffic during April 2007 up by 8.78% YoY as compared to INR 3,327.77 crore during April 2006. While the net tonne kilometer has recorded at 39,552 million during April 2007 up by 0.33% YoY as against 39,420 million during April 2006.

Railways total earnings during April 2007 are as follows
1. INR 1,376.95 crore came from transportation of 26.45 million tonnes of coal
2. INR 298.55 crore from transporting 3.08 million tonnes of food grains
3. INR 327.84 crore from transporting 6.29 million tonnes of cement
4. INR 240.56 crore from transporting 2.84 million tonnes of petroleum, oil and lubricants.

The release added that Railways has also earned
1. INR 257.07 crore from transporting 3.62 million tonnes of iron ore for exports
2. INR 156.33 crore from transporting 2.14 million tonnes of fertilizers
2. INR 170.11 crore from transporting 1.55 million tonnes of iron and steel for steel plants
3. INR 169.76 crore from transporting 4.49 million tonnes of raw material for steel plants
4. INR 622.75 crore from transporting 10.22 million tonnes of other goods.

TN approves Malavallis power equipment SEZ

It is reported that the Tamil Nadu Cabinet last week gave its approval for a Special Economic Zone of Future Energy Zone India Ltd. The INR 1,300 crore SEZ will house units that manufacture equipment for power plants based on non conventional energy sources.

A press release from the Tamil Nadu government said that the Tamil Nadu Energy Development Agency will be given 1% equity stake in FEZ.

Future Energy Zone is a special purpose vehicle set up by Malavalli Power Plant. The Mumbai based Kamala group is the co investor in the project.

Brazils steel capacity could reach 70 million tonnes by 2015

According to industry experts, Brazil's crude steel capacity could grow to some 65 million tonnes to 70 million tonnes by 2015 from the current 37 million tonnes as Brazilian steel industry plans to invest USD 22.7 billion and more investments are under consideration.

Mr Luiz AndrRico Vicente former president of Brazilian Steel Institute IBS told delegates at the opening of the 20th Brazilian steel industry in S Paulo that the higher capacity would come from new projects under study. He said "We need to expand capacity but it will also require having a market to sell to abroad.

The increased output in Brazil would meet demand at home and make the country a strong competitor in markets abroad. Russia, China and India are also expanding their presence in the worldwide steel industry. Mr Vicente said that But despite high production volumes, steel usage in Brazil is small compared to other regions. Brazils per capita consumption has been at 100 kilograms per year for more than 20 years versus over 400 kilograms per year in some developed countries."

Brazil is the world's 10th largest steel producer and the largest in Latin America, with 25 plants operated by eight groups. Its raw steel output is expected to grow to 34.9 million tonnes in 2007 from 30.9 million in 2006. Brazilian raw steel exports are expected to grow to 13.5 million tonnes in 2007 from 12.5 million in 2006, while domestic sales of steel should grow to 19.3 million tonnes from 16.5 million last year.

Mr Rinaldo Campos Soares CEO of Usiminas became the new IBS president as of May 29th 2007. IBS, founded in 1963, has among its associates Acesita, Villares Metals and Gerdau.

Nippon Steel prefers soft alliances rather than M&A

Asia's largest steelmaker Nippon Steel doesn't plan to buy rival producers to boost output as the industry consolidates, instead prefers to pursue soft alliances like entering joint ventures or exchanging shares with other companies and suppliers. The soft alliance strategy focuses on partnerships with companies that share the same values as Nippon Steel, utilizing technological cooperation and capital tie ups to strengthen the relationship.

Mr Akio Mimura president of Nippon Steel told reporters at the 20th Brazil Steel Summit in Sao Paulo that "I am not interested in participating in consolidation. We want to create projects with partners that give merit to both companies. Nippon Steel will continue to be an important player in the global market. We will not only be watching our growth, but also the growth of companies that share our same values."

One such project is the previously announced expansion to 14.7 million tonnes by 2015 up from current production of 9.5 million tonnes at an investment of USD 8.4 billion by Usinas Siderurgicas de Minas Gerais in Brazil. Nippon Steel owns 50.9% of Nippon Usiminas, a Japanese group that has joined with Vale, Brazil's Previ investment fund and a Brazilian construction group to control Usiminas.

Nippon Steel expects to produce 32 million tonnes or more of steel in 2007, with the total depending in part on the repair of blast furnaces. With subsidiary production included, the amount will rise to 35 million tonnes or more. Nippon Steel made 31.7 million metric tons of steel in 2006 or 28% of Japan's total production.

Chinese steelmakers busy with expedite export shipments

Since May the 22nd 2007, most Chinese steel makers have been holding offer and paused new export business. Many steel mills and traders are rushing to deliver cargoes into bonded warehouse to meet the deadline of June 1st 2007 so that they could be exempted the export duty.

Exporters say that the deadline for imposing export duty is customs clearance time, which is same with former export tax policy on semi steel exports, instead of vessel leaving date. However, trading sources also indicate that customs clearance before June 1st 2007 would be invalid in case vessel does not arrive before June 15th 2007. This is believed to resist excessive speculation.

Another source told Mysteel that CISA is going to hold a meeting on June 1st 2007 to discuss export price in the wake of export tax imposition. According to most mills, CISA is anticipated to encourage them to further raise price in order to stabilize market situation even if they find it hard for overseas customers to accept for time being.

While other tier two and small sized mills are busy at negotiating with customers, wishing to reduce loss from previously concluded orders. They are not ready to start new business or announce updated prices until they have solved the current problems.

(Sourced from MySteel.net)

BCG estimates global steel output to grow to 1.7 billion by 2015

Germany weekly Die Welt citing an unpublished study by Boston Consulting Group reported that global crude steel output will advance 3% to 4% a year to 1.7 billion tonnes by 2015 with the world's biggest steelmakers gaining combined market share.

The study said that the world's 10 largest steel producers will account for 35% of global output by 2010 compared with about 28% now.

Mr Martin Woertler a BCG analyst told Die Welt that I expect consolidation to come to an end in the long term, when there are four or five large steel companies or alliances of comparable size.

The newspaper added that most consolidation will be in China in the short term, where there are several hundred steelmakers out of which only 15 have crude steel output of more than 15 million tonnes a year.

Sumitomo bags long term OCTG supply contract with Statoil

Sumitomo Metal Industries Ltd and Sumitomo Corporation have been awarded an exclusive 5 year Oil Country Tubular Goods supply contract by the Norwegian energy company Statoil ASA.

Under the contract, Sumitomo Metals and SC will supply high end and super high end seamless OCTGs. The contract also calls for the supply of a new item, super duplex, annual demand for which is expected to be in the range of 500 tonne to 1,000 tonnes. Sumitomo Metals and SC have also been concluded with Statoil a 5 year basic agreement from 2007 for seamless line pipes with 13% chrome content.

All the supplies would be made from Sumitomo facilities with back up from JFE for 13% chrome OCTG

Sumitomo Metals and SC have been supplying OCTGs and line pipes, principally high end products, to Statoil since the late 1980s, with total supply to date of approximately 1.2 million tons. As the current long-term contract will expire in March 2008, a new tender for 2008-2013 was announced at the end of 2006. Based on a 20 year track record, Statoil acknowledged Sumitomo's reliable performance and edge in product quality, especially in high grade material and premium connections. Consequently, Sumitomo Metals and SC were deemed to be the best supplier, and were awarded another contract.

Statoil is Scandinavia's leading energy company. Headquartered in Norway, it has a presence in more than 30 countries. Statoil primarily uses VAM brand premium connection for its OCTGs. The company is expanding its operations from the Norwegian Continental Shelf to international markets, making it increasingly important for Sumitomo Metals and SC to supply reliable OCTG products.

Baosteel and Mitsui to set up 2 more steel processing facilities

China Business News reported that Mitsui & CO LTD and Baosteel will jointly build two steel processing and distribution bases in China by this year end.

The first base will be in Shane dong Province with annual processing capacity of 110,000 tons the steel sheets, which will mainly feed automotive enterprises like General Motor. BaoSteel will take a 65% stake in the JV and manage the facility.

The second base will be located in Guangdong Province with annual processing capacity of 60,000 tons mainly to meet demand of the South China clients. This base will also store and sell products made by BaoSteel, which is going to take a 75% stake and also manage the operations.

The steel wholesale & logistic business is quite profitable in China and attracts big foreign investment these years. Mitsui & Co has taken a fairly big share of China's steel processing and distribution market. Shortly before, it co built an automotive sheet processing center in Changchun with Angang and FAW. Its joint bases with BaoSteel have come up to seven across the nation. Since Dec 2 2002, when Shanghai Bao-Mit Steel Distribution Co was set up, Mitsui has also built Bao-Mit in Chongqing, Guangzhou and Qingdao.

MEPS forecast on Asian HR prices

MEPS said that its Asian average hot rolled coil price moved up again in May 2007 and in the short term, it still see a possibility for further price strengthening as Chinese export prices move higher due to the new export levy. MEPS however added that figures are expected to reduce from the end of the third quarter onwards as oversupply sets in after new capacity, due on stream in China, is expected to put negative pressure on local prices.

According to a MEPS study, Chinas export volumes are not predicted to fall significantly below 2006 levels despite the introduction of new tax measures and non Chinese values may in fact benefit from a slowdown in the growth of import volumes in the short term but longer term excess supply could lead to a steady decline in the average Asian value.

The MEPS Asian Average Hot Rolled Plate figure also increased this month due to tight supply and higher input costs. In the medium term, we expect values to remain firm as order books stay strong and import prices rise across the region from the Chinese tax levy.

USs steel nail makers file AD charges against China and UAE

Platts reported that 5 US producers of steel nails have filed antidumping duty petitions with the US International Trade Commission alleging that dumped imports of nails from the People's Republic of China and the United Arab Emirates are causing material injury to the domestic industry. Domestic nail producers contend that unfairly priced imports of steel nails have injured the US industry by undercutting their prices and taking their sales based on unfair trading practices. The petition requests that the US government impose antidumping duties on nail imports from China and the UAE.

Alleged dumped imports of steel nails from China and the UAE constitute a large and increasing share of the US market, the petitioners said in a statement. Imports of nails from China and the UAE surged from 411,980 short tons in 2004 to 698,460 short tons in 2006 or by 70%, noted the statement, adding that Chinese and UAE shipments accounted for 75% of all nail imports in 2006. The petitioners have asked for antidumping margins of 59% to 136% for China and 98% to 114% for the UAE.

The petition covers certain steel nails that are produced from various grades of steel, principally wire rod and that have a variety of finishes, heads, shanks, points and sizes. Steel roofing nails and nails for use in power actuated hand tools are not covered by the petition.

The petitioners are Missouri based Mid Continent Nail & Poplar Bluff, Davis Wire Corporation at Irwindale in California; Gerdau Ameristeel's Atlas Steel & Wire Division at Tampa in Florida, WH Maze Companys Maze Nales at Peru in Illinois and Treasure Coast Fasteners of Fort Pierce in Florida.

Coking coal prices forecast to jump by 22% next year

Goldman Sachs JBWere Pty forecast that the price of coking coal, used in steelmaking, may jump 22% next year because of rising demand from India and congestion at Australian ports.

Analysts led by Mr Malcolm Southwood said in a report that contract prices for coking coal may rise to USD 120 a tonne for the year starting April 1st 2008 from USD 98 this year.

The analysts said that With no evidence of any slowdown in demand, and no quick fix to the logistical bottlenecks afflicting suppliers. We believe the market will remain in bulk upgrade mode.

Australia, the worlds largest exporter of coking coal, is likely to lower exports this year due to congestion at its Dalrymple Bay port in Queensland State.

China's ferroalloy industry faces many challenges

Industry insiders at the China International Ferroalloy Conference 2007 in Shanghai told Interfax that China's ferroalloy industry will face increasing challenges from further restrictive export policies due to take effect this year.

Mr Yang Yongxin, an official with the National Development and Reform Commission's industrial policy division, announced that the government will start charging increased power prices to outdated ferroalloy mills in July this year. Mr Yang said that the government will increase power prices by CNY 0.15 per kilowatt hour for electric furnaces below 5000 kilovolt amps, which need to be eliminated in order to comply with industry policy, as well as increase power prices by between CNY 0.02/kWh and CNY 0.05/kWh for electric furnaces 5000 kVA or above. Mr Yang also revealed that the NDRC is considering eliminating all electric furnaces below 6,300 kVA, or even below 9,000 kVA, within the next two years. He added that it is likely that the NDRC will release a new policy by the end of the year. Mr Yang commented that these policies are designed to accelerate ferroalloy industry restructuring and to eliminate outdated facilities.

The price policy will substantially increase production costs and could drive small and medium ferroalloy producers out of the market. Mr Wang of a medium sized ferroalloy producer Jilin Dongfeng Ferroalloy Co Ltd told Interfax that "With an 8,000 kVA electric furnace, production costs for 1 tonne of ferrosilicon will increase by CNY 1,300 (USD 169.85), making our products uncompetitive against larger domestic producers with their own power stations.

As one of the most heavy polluting and high energy consuming industries, China's ferroalloy industry needs to reduce capacity below 20 million tonnes by 2010, a reduction of 24% from 2005 by eliminating outdated ferroalloy plants. Mr Chang Zhenyou chairman of the China Ferroalloy Industry Association and president of Jilin Ferroalloy Group told Interfax that "In order to enhance consolidation, we intend to reorganize the industry so that 40 ferroalloy factories produce more than 65% of the country's total capacity by 2010. Moreover, at least two ferroalloy producers will have an annual production capacity of 1 million tonnes.

China will probably continue to restrain ferroalloy exports through further increasing export taxes and issuing export licenses within the year. China will increase the export tax on ferrosilicon, ferrochromium, silicon ferrotungsten, ferrotitanium and silicon ferrotitanium from 10% to 15% on June 1st 2007, while the export tax on ferromanganese, silicon ferromanganese, ferronickel, ferromolybdenum and ferrotungsten will be left at the current level of 10%. The Chinese government aims to control ferroalloy exports to within 10% to 15% of annual production.

China's ferroalloy production has expanded rapidly in the past three years, from 9.198 million tonnes in 2004, to 14.332 million tonnes in 2006. In the first quarter of this year, China produced 3.571 million tonnes of ferroalloy up by 44.5% YoY from the same period last year. China's ferroalloy exports amounted to 761,000 tonnes in the first quarter of this year soaring by 72.1% YoY from the same period last year. The three largest ferroalloy product exports are silicon manganese, ferromanganese and ferrosilicon.

However, domestic ferroalloy producers are concerned that reduced exports will increase domestic supplies and cause a fall in product prices. Domestic ferroalloy prices unexpectedly hiked after the Spring Festival, due to significant growth in ferroalloy purchases from steel mills and a production cost increase.

Mr Visclosky urges for action against Chinese tube imports in US

YIEH reported that US representative Mr Pete Visclosky is calling for the congress to resolve Chinese steel pipe and tube exports saying that they have an unfair trade advantage. Mr Visclosky wrote to US trading representative, asking for dealing this issue during the US and China Strategic Economic Dialogue from May 23 to May 24.

Mr Pete Visclosky said "If we allow the Chinese steel industry to continue down the path they are on, we will see more outsourcing of American steel jobs, and the domestic steel industry will be weakened. We must not let our own trade policies hurt our economic security."

China's steel pipe and tube export is estimated to occupy 30% of the US market in 2007, up to 3.9 million tonnes.

POSCO to look for alternates due to bottlenecks at Queensland

The Australian media reported that POSCO, which buys Queensland coal worth more than USD 1 billion, is developing other overseas contacts because of costly delays in exporting coal from the Dalrymple Bay Coal Terminal south of Mackay in central Queensland due to unreliable deliveries by the state owned railway.

It is reported that POSCO has written to Deputy Premier Anna Bligh in late February and directly lobbied Premier Peter Beattie on his trade mission to Seoul this month to resolve the crisis but had heard nothing since. As a result, the company has been pursuing alternative coal suppliers in countries such as Mongolia, Russia, Mozambique and Indonesia.

Mr YT Kwon executive VP told the newspaper from Seoul that he was concerned the delays were mostly due to Queensland Rail and its overly bureaucratic approach to the crisis. He said "Frankly, Queensland is the very worst of our suppliers right now.”

Mr Peter Beattie premier of Queensland and Mr Stephen Cantwell CEO of QR have defended the transporter's performance saying that an infrastructure upgrade had combined with other problems to hit coal tonnages. Mr Beattie said that an escalating dispute between Queensland Rail and mining companies over the export of coal from the state can be resolved.

Australia could loose coal export contracts unless the Queensland government can clear a tightening bottleneck at its biggest coal port.

Chelyabinsk Zinc forecasts that Russian zinc consumption and production would grow

Russian zinc major Chelyabinsk Zinc Plant estimates that the zinc consumption in Russia may nearly double up to 400,000 tons in next 5 years, stimulating domestic zinc mining and refining.

Mr Berislav Galovich commercial director of Chelyabinsk Zinc Plant at the 11th Zinc and Its Markets seminar held in Madrid described the current zinc industry situation in Russia and the CIS states, as well as its past and forecasts for the future. In particular, he noted that the majority of producers have successfully overcome the difficulties of the transition period and are ramping production up. Thus, in 2006, zinc production in Russia made about 236,000 tonnes, whereas the total production level for all the CIS countries almost reached that of the 1980s levels of 750,000 tonnes annually.

According to Mr Galovich, production of zinc concentrate in Russia began to rise in the second half of 2006. By year end, Russian mining companies had produced 171,000 tonnes of zinc concentrate. Russia possesses 17% of world zinc reserves of approximately 45 million tonnes and the two largest zinc deposits in the world Ozyornoe and Kholodninskoe in Republic of Buryatia. Zinc consumption in Russia in 2006 reached 174,000 tonnes as compared with 900,000 tons annually in the Soviet days. The significant difference in consumption is due to decreased supplies to the military industry. In Russia, over 60% of zinc is used for the production of galvanized steel, mainly for the automobile industry and construction.

According to Mr Galovichs forecast, in comparison with 2006, construction volumes will increase by more than 50% by 2010, whereas automobile production in Russia will double by 2015 and beyond this, there is a substantial potential that zinc consumption in such areas as alloy production and usage in the chemical industry will increase.

The largest zinc producers in the CIS are Russian Chelyabinsk Zinc Plant with 148,384 tonnes production in 2006 and Kazakhstans Kazzinc Plant with 289,000 tonnes production in 2006. However as per Mr Galovich CZP is the only zinc plant in the CIS producing SHG zinc confirmed by LME certificate.

SCM and Privat negotiating for Kryvorizky Iron Ore Factory Report

Ukrayinska Pravda, citing a reference to a source close to negotiations, reported that System Capital Management is holding negotiations with Privat Group on the issue of buying no less than 40% of Kryvorizky Iron Ore Factory shares which will allow SCM to gain control over the enterprise.

A report in Komersant-Ukrayina newspaper mentioned a source close to negotiations as saying that They are discussing KIOF shares package which is close to control package in its size. The negotiations are drawing to an end. It is expected that Antimonopoly committee will give its consent within two weeks.

The news paper added that the parties have not yet decided on whether they will manage the company on a par or the control package of KIOF shares will be handed to SCM.

The report mentions that both SCM and Privat refused to comment on negotiations.

Strike at Voiseys Bay ends

Metals Insider reported that a wild cat strike at the Voiseys Bay nickel mine in Canada ended on last Friday with mill operations resuming after a two day shutdown. However, there remain considerable tensions among unionized employees at the use of replacement workers by two contractor companies whose own employees have been on strike since the middle of April.

It was an incident with such a replacement worker that caused the wild cat action last week and more trouble may be brewing as the mine gears up for its spring shipping season.

There is a background threat that USW members will simply refuse to handle any raw materials shipments that have been loaded by replacement workers.

The United Steelworkers union, which represents workers at Voiseys Bay and which has also been pushing the case of the contractor workers, has representation at CVRD Incos other divisions, which must process Voiseys Bay concentrates.

BHPB refutes NUMs racism claims over strike at Samancor

Mining group BHP Billiton denied allegations of discrimination from a union that launched a strike at its South African Samancor Manganese unit in the Northern Cape Province. It said "The allegation of discrimination laid by the NUM against Samancor Manganese is completely untrue and irresponsible.

BHPB said that it had changed transport arrangements owing to safety concerns, but this affected workers of all races. It said "The decision to move the pick-up points directly affects only about 30 to 50 employees of all races out of total workforce of around 1,200.

BHPB said that the strike, launched on Monday by the National Union of Mineworkers, has affected production, but operations are continuing.

The NUM said late on Monday that over 500 miners had downed tools at BHP Billitons Samancor mine over discrimination. The union said the miners were on strike because black workers had to walk 2 kilometers to their nearest bus stop, while employees of other races got their transport in front of their homes.

Samancor, 60% owned by BHP Billiton and 40% by Anglo American, is the worlds biggest producer of manganese.

Evraz's board approves acquisition of 50% interest in Yuzhkuzbassugol

Evraz Group SA announced that further to its announcement of May 25th 2007, its board of directors has reviewed and approved the proposed acquisition of a 50% interest in Yuzhkuzbassugol from existing shareholders.

Shanghai Nonferrous Metals Index launched

China Daily reported Monday that the Shanghai Nonferrous Metals Trade Association said that it would launch its first daily nonferrous metals daily price index to provide a reliable indicator to users and investors. The Shanghai Nonferrous Metals Index will be based on the spot prices of the six non ferrous metals published on the Shanghai Nonferrous Metals website.

The weighting of each metal has been set according to figures provided by China's State Statistics Bureau and China Customs. The weighting of the index will re adjusted every two years in order to keep abreast of new developing in the non-ferrous metals sector. China Daily reported that 105 companies including nonferrous metals producers, 12 listed nonferrous metals and metals traders will provide the pricing reference.

Mr Zhang Minxiang chairman of Shanghai Nonferrous Metals Trade Association said that "As a big nonferrous metals producer and consumer, we are in urgent need of a price index to produce out own voice in the international market and better serve China's enterprises."

Mr Cheng Daxuan secretary general of the Shanghai Price Association said that the index is expected to reflect the fundamentals of the domestic nonferrous metals market. Mr Chen noted it should provide the government with a simplified approach to monitor the industry and enable it to draft appropriate regulations.

The total output of copper, aluminum, nickel, lead, zinc and tin, comprises 90% of China's entire non ferrous metal output.

Arcelor Mittal to unveil new brand identity soon

Times News Network recently reported that Arcelor Mittal is set to unveil its new brand identity soon and that a new logo, corporate colors and a new brand positioning strategy for the group will be unveiled. After it is unveiled to an internal audience, the new brand will be deployed throughout the Arcelor Mittal group.

AS per report, global branding consultancy, FutureBrand, which had earlier worked on the Mittal Steel brand, has been appointed to create the unified Arcelor Mittal brand. FutureBrand won the pitch against competition from the likes of Wolff Olins, Landor and Enterprise IG.

According to a brand update on arcelormittal.tv a web and blog channel specially created in February to document the entire merger process between the two companies the key challenge for the common brand exercise is to merge the two business cultures, creating one new, single identity and motivating everyone to work together towards their common goal.

They will spread the message around a unique band of 60 brand champions who have been identified and they will be responsible for rolling out the brand in every location which houses an Arcelor Mittal location. Across the group, almost 250 people are dealing, either on a full or part time basis, with internal and external communication issues on all levels.

The impending revelation of Arcelor Mittal’s future new brand is being keenly awaited by the global steel community.

Indonesia to privatize PT Krakatau Steel Report

ANTARA News agency recently reported that Indonesian government will soon propose the privatization of another 10 state companies following approval to privatize 12 state owned enterprises. Previously, the House of Representatives had approved a proposal to privatize three state enterprises.

Mr Sofyan Jalil state minister for state enterprises responding questions from the press said that "I will try to privatize 10 state owned enterprises next year and hopefully the good ones will be privatized by way of an Initial Public Offering." But he declined to elaborate on the 10 state companies and will give details only after their privatization has received approval of the House of Representatives.

As per report, under the 2007 privatization program, 15 of the proposed 17 state firms will be divested which include PT Krakatau Steel. The other firms mentioned in the report include PT BNI Tbk, PT Wijaya Karya, PT Jasa Marga, PT Garuda Indonesia, PT Merpati Nusantara Airlines, PT PNM, PT IGLAS, PT Cambrics Primissima.

Baosteel & Mitsui ink deal for Australia iron ore transportation

Metal Bulletin citing a spokesperson from the Japanese shipper reported that Baoshan Iron & Steel Co Lt has signed a 25 year charter contract with Mitsui OSK Lines to transport iron ore from Western Australia to Shanghai beginning next month.

The report said that this is the sixth long term contract between the two and under the terms of the latest deal, Mitsui will build a 225,000 ton ore carrier, which is expected to enter service in late 2011.

The rising freight charges have prompted a number of China's top steelmakers to strengthen ties with shippers by establishing strategic cooperation or signing long term charter contracts.

LionOre estimates 2.9% shortfall in 2007 nickel production

LionOre Mining International Ltd, currently the object of a bidding war between Xstrata and Norilsk Nickel, announced that it expects a 2.9% shortfall in the groups 2007 total nickel production target due to a delay in the target date for full mine production from the Maggie Hays underground mine in Australia.

LionOre added it now does not expect full production levels from Maggie Hays to be attained until the third quarter because of the rehabilitation program due to deterioration in ground conditions there. It said life of mine production is still in line with the current life-of mine plan.

Canada based LionOre said that it expects its production for the year could drop to around 43,000 tonnes of payable nickel compared with 44,300 tonnes published in earlier guidance.

Great Lakes iron ore trade in April down by 4% YoY

It is reported that the shipments of iron ore on the Great Lakes in April 2007 were down by 4% YoY to 5.7 million net tons because of low water levels on Lake Superior.

The Lake Carriers' Association in Cleveland said that the low water limits the amount of cargo that can be carried although there are some indications that the steel industry's demand for iron ore is somewhat weak. Mr Glen Nekvasil VP of Lake Carriers' Association said that One 1,000 footer carried 16% less than its capacity during the month.

April is a significant month for iron ore shipping data, because it is usually the year's first full month each year for the cargo of the raw material to make steel. The iron ore trade begins out of Michigan in March when the locks at Sault St Marie open.

For the year, Great Lakes iron ore trade stands at 10.4 million tons, a decrease of 11.3% YoY as compared with January to April 2006 but on pace with the five year average for the period through April.

The Lake Carriers' Association represents companies that operate 63 US flag cargo vessels on the Great Lakes.

CJSC RFZ merges with MMK

Magnitogorsk Iron and Steel Works announced reorganization of Closed Joint Stock Company RFZ with the registered address at: Ul.Zaveniaghina 9, Magnitogorsk, 455049, Chelyabinsk Region, Russian Federation, in the form of a merger of into OJSC MMK.

The authorized capital of OJSC MMK, and the quantity and par value of its shares have not been affected by the above reorganization.