POSCO not to give equity to displaced people – Report

FE reported that POSCO India is not in favor of allotting equity stakes to people getting displaced from the site of the proposed steel plant. Mr Soung Sik Cho CMD of POSCO India told FE that “We do not have any such plan and we do not believe that it will help the people.”

According to him, the people would have to hold the stakes for a long time to reap its benefits and also, the equity would be too small to offer genuine worth or value.

POSCO India is preparing a special R&R package for the people facing displacement because of its project near the port town of Paradip in Jagatsingpur district. Mr Cho informed that “We have engaged XIMB to prepare a special R&R package keeping in view the state government’s policy. The package would be based on the needs of the people. It will be announced after being cleared by the Rehabilitation and Periphery Development Advisory Committee.”

The latest resettlement & rehabilitation policy of Orissa government said that “At the option of the displaced family, and subject to provisions of relevant laws in force for the time being, the project authority may issue convertible preference shares or secured bonds up to a maximum of 50% out of one time cash assistance.”

JSW may acquire more service centers in Europe

Times News Network reported that JSW Steel is planning to acquire more service centers across Europe, where value added products will be processed as per the customer needs. As per report, JSW Steel is looking at similar acquisitions in 5 more European countries in France, Italy, Germany, the Netherlands and Spain.

Mr Sajjan Jindal vice CMD of JSW Steel said that “We are not looking at any big acquisitions. One needs to have the management and financial width and we don’t want our projects in India to be affected. More importantly, we want to maximize the cost advantage that India has in manufacturing. But we believe that finishing the steel into specialized products should be done closer to the market, in these European countries.”

JSW Steel acquired UK based service center Argent Independent Steel in April 2007 for INR 31 crore.

JSPL bags Golden Peacock Eco-Innovation Award-2007

Jindal Steel and Power Ltd has bagged the Golden Peacock Eco-Innovation Award-2007 from the World Environment Foundation under the Energy Sector category.

Mr Olla Olsten ex prime minister of Sweden and chairman of the World Council for Corporate Governance presented the award to Mr AK Parsad AGM Power Plant and Mr Devender Tripathi of Environment Management of JSPL.

The Institute of Directors has instituted this award under World Environment Foundation.

Iron ore mining’s status as public utility service extended for 6 months

BL reported that Indian government has extended by six months the status of iron ore mining as a public utility service.

In a notification, the labor ministry said that this was being done in public interest under the Industrial Disputes Act.

As per release, mining workers would have to intimate their employers at least six weeks in advance before proceeding on strike.

New bloom caster operating successfully at SAIL DSP

It is reported that a new 4 strand bloom caster supplied and installed by Danieli Centro Met on a turnkey basis operates successfully at the SAIL’s Durgapur Steel Plant since early April 2007.

The report added that the caster features all updated technologies in high speed continuous cast blooms including hydraulic oscillating tables, multi taper copper tube moulds, low emission type radioactive mould level control, advanced air mist type cooling and a level 2 process control and automation system.

The state of the art 9 meter radius continuous caster is designed to produce 160mmx210mm/230mm, 200mmx200mm and 150mmx300mm/350mm sections in lengths of 3.4 to 10 meters. It has a nominal rated production capacity of 750,000 tonnes per year with a potential to reach 0.9 million tonnes per year of cast blooms in the future. Product grades include low, medium carbon and low alloy steels.

TATA Steel looking at titanium venture at Kerala – Report

FE reported that TATA Steel is examining setting up a titanium venture based on the titaniumdioxide rich ilminite mines in Kerala. TATA Steel's proposed project is for technology association in manufacturing titanium metal, titanium sponge and titanium alloy and this would need investment to the tune of INR 1200 crore to INR 1500 crore.

Sources told FE that TATA Steel has informed Kerala government of keenness to follow suit and a MoU is likely to be signed in a month or two. The TATA Steel Kerala government JV is proposed in Chertalai, not too far away from Chavara or Arattupuzha where the raw material iliminite sands are abundant.

TATA Steel is reported to have shown interest after Russian firm Rosoboron signed a MoU with Kerala government for an INR 1500 crore ilminite forward integration project. TATA Steel has also proposed a titanium sponge manufacturing facility of nearly the same capacity as that of the Russian firm.

Experts said that the iliminite resources in Kerala could afford 3 projects of such capacities. As much as 1 million tonnes of ilminite will have to be mined to feed titanium projects of 10,000 tonne capacity each and this would necessitate capacity expansion for State PSU Kerala Minerals and Metals Ltd.

Sona Alloys to set up steel plant at Lonand in Maharashtra

It is reported that Gujarat based Jain Group’s Sona Alloys, which pioneered ship breaking, will be setting up a Greenfield integrated steel plant at Lonand in Maharashtra with an investment of INR 350 crore. A MoU with Maharashtra government has been signed in this regard.

It will manufacture 0.3 million tonnes of various grades of steel including stainless steel, alloy steel, mild steel to meet demand from industries including construction, foundries and automobiles. The company will start production by December 2008.

Utkal coal block in Orissa to feed many power plants

Statesman News Service reported that the Utkal coal block in Orissa has attracted a number of coal producers in both private and public sectors. They are planning to set up open cast coal mines operations in the area and are led by Orissa Mining Corporation.

Utkal block is part of the Talcher coalfield and is located in the Raijharan region of Chhendipada tehsil. It is divided into 7 parts each denoted by letters of the alphabet like Utkal-A, B1, B2, C, D, E and F. All the coal blocks except Utkal D are for captive power plants.

Block A was earlier allotted to Kalinga Power Corporation in 1996 to set up a power plant at Kalinga Nagar. But when the company changed its decision to set up the plant, the block was re allotted to MCL and four companies including Jindal Stainless Ltd. B1 block has been allotted to Jindal Steel and Power Ltd in 2003 as a captive coalmine while Monnet Ispat &Power Ltd took B2 block in 1998. Block C has been allocated to IMFA group in May 1998 while Block F came under TATA Sponge Iron Ltd of Keonjhar in 2006. Orissa Mining Corporation got Block D while Block E has been given to Nalco for captive mining in August 2004.

According to Mr PC Patra state deputy director of mines, the lease issue of these companies sans KCMPL for coalmines is under process. In the next two to three years time, the area would be one of the major coal producers in the state.

IPI pipeline agreement likely in July 2007

PTI reported that an Iranian delegation will visit India next month in a bid to finalize an agreement on the over USD 7 billion pipeline to bring gas from Iran to India and Pakistan. Mr Murli Deora union petroleum minister said that “The prime minister himself has said this will be a pipeline for peace and progress. The process is continuing and very soon we will be launching the pipeline.”

Mr Deora said that “Only two weeks back, the secretary of ministry of petroleum was in Tehran and after one month Iranian officials would be coming to meet us.” He added that discussions were on with Iran and Pakistan on prices and how the pipeline would be brought to India and major issues had been sorted out while pending issues like transportation fees and alignment would be worked out soon.

Mr MS Srinivasan petroleum secretary said that the 3 sides are likely to sign an agreement by end of July 207. He added that India Pakistan official level talks by month end or early July 2007 will be followed by a ministerial dialogue to seal issues on transportation tariff and transit fee payable to Islamabad for allowing passage of the pipeline to India. After resolving the two issues, the 3 countries would sign a framework agreement for the project.

USD 7 billion to USD 8 billion project for 2,300 kilometer long pipeline will initially carry around 60 million cubic meters of gas per day, split equally between India and Pakistan.

TRF to supply material handling system to Shadeed Iron in Oman

It is reported that Indian TRF Limited has bagged an order worth USD 16.5 million from Oman based Shadeed Iron & Steel for material handling system for their new steel plant at Oman.

TRF Ltd is a source of engineered equipment, systems and services for EPC & EPCM services, bulk material handling systems, coal beneficiation systems, steel plant systems, and bulk material handling equipment.

Recently TRF Ltd had also received letter of intent for supply, installation and commissioning of yard equipment from Navyug Engineering for Krishnapatnam Port. The approximate size of the contract is INR 1.25 billion.

Vedanta Alumina seeks coal block for Orissa plant

FE reported that Vedanta Resources’ subsidiary Vedanta Alumina has appealed to the coal ministry for the allocation of long term coal linkage for the first phase of its 675MW captive power project in Orissa.

It has informed the ministry that both projects are in advance stages of implementation and the boilers would be ready for light up in the first week of August 2007 to begin power generation in October 2007. The company has brought to the coal ministry’s notice that it would need continuous coal supply from the end of July 2007.

Vedanta Alumina’s proposed project with a Greenfield aluminum smelter of 250,000 tonne per annum capacity will need 3.88 million tonnes of coal from Mahanadi Coalfields Ltd. Later, it proposes to double the capacity of smelter and captive power project in the second phase.

Ma Chandi Durga Ispat to set up a steel plant in Jharkhand

It is reported that Ma Chandi Durga Ispat is likely to acquire land for setting up 1.1 million tonnes per annum steel plant with an investment of INR 1,500 crore at Nala in Jamtara district of Jharkhand by end of 2007. The project would come up on an area of 1040 acres land.

Ma Chandi Durga Ispat is also planning to set up iron ore fines unit with a capacity of 300 tonnes per day and a 25 x 2 MW coal and gas based power unit at the same location. The required machinery will be procured from Delhi, Kolkata, Popuri, Hyderabad. It will soon finalize contractor and machinery suppliers for the project.

Mecon is the project consultant.

PGCIL’s plans for transmission lines with private participation delayed

Times News Network reported that a couple of major power transmission projects including the western region system strengthening and Parbati Koldam hydro projects in Himachal Pradesh have hit a road block due to delays in getting approvals from the finance ministry. As per report, Parbati Koldam has been delayed by almost 18 months while WRSS scheme II has been delayed by 6 months.

The report cites a government source as saying that “The file of Parbati Koldam project is pending before the public private partnership appraisal committee and the department of expenditure under the finance ministry. Regarding WRSS-II, a decision has to be taken by the project investment board. The board has sought additional information from the power ministry on private participation and the bidding process.”

The Power Grid Corporation of India, the nodal agency for both WRSS and Parbati Koldam, had selected the private partner through international competitive bidding.

For the 1,600MW Parbati Koldam projects, PGCIL invited bids in February 2004 and the final letter of selection was issued in December 2005. But the agreement has not yet been signed. PGCIL and Reliance Energy had floated a 26:74 JV company for the INR 1,500 crore projects.

Reliance Energy Transmission Limited had bagged the INR 1,800 to INR 2,000 crore WRSS-II project in the country’s first international competitive bids based on electricity tariff. The bidding process had been completed in January 2007, but the letter of intent is yet to be issued. As per the request for submission document, the LoI was to be signed by February 2007 and is scheduled to be commissioned by March 2010. After completion, the project is expected to be handed over to PGCIL for operation.

India’s transmission perspective plan, for the 10th and 11th plans, focuses on the creation of a national grid in a phased manner by adding over 60,000 kilometers of transmission network by 2012. Such an integrated grid will evacuate an additional 100,000MW by 2012, and carry 60% of the power generated in India. The existing inter regional power transfer capacity is 9,000MW, which is to be further enhanced to 30,000MW by 2012 through creation of Transmission Super Highways.

ABG Shipyard gets export honors from EEPC

ABG Shipyard Ltd announced that it has been awarded with a "Shield for Star Performer as Large Enterprise" in the product group of other transport equipments including vessels in recognition of the company's outstanding contribution to engineering exports during the year 2005-06.

ABG Shipyard added that it has also been recipient of “All India Trophy for Highest Exporters in the category of highest growth in export - Non SSI.” for the fourth consecutive year given by the Engineering Export Promotional Council and also got trophy for highest exporter for highest growth in exports non SSI for its performance during the year 2003-04 awarded by the Engineering Exports Promotion Council.

UP government approves 3 power projects

It is reported that Uttar Pradesh government has accorded approval for the three private sector power projects Rosa, Anpara C and Srinagar. In addition, UP government had initiated action to set up projects of 3,000 MW capacities in Bara and Karchana in Allahabad district with private sector participation through international bidding.

The construction work on Rosa Power Project began on February 28th 2007 at project site in Shahjahanpur district being developed by Reliance ADA Group that will generate 600 MW power from stage I and supply to consumers in Uttar Pradesh.

The state government in November last year approved the upgrade of coal based Rosa thermal power plant from 600MW to 1,200MW, soon after Reliance Energy Ltd acquired the Rosa power supply Company.

UP Power Corporation Ltd has already signed a power purchase agreement with REL on buying power from Rosa plant.

China changes export rebates on steel pipes

China Ministry of Finance and State Administration of Taxation on June 19th 2007 announced that China will remove export tax rebates on 533 high energy consuming, high polluting and resource intensive goods, including welded pipes in a bid to tame its rampant trade surplus and soften escalating frictions with other trading partners.

According to the statement, all common carbon welded pipes will be deprived of the current 13% export tax rebates. The tax rebates for seamless pipes and other articles of iron and steel such as sheet piling, angles, shapes, sections, rails will be lowered down to 5% from 13%.

The ministry added that there shall be no grace period to cushion the market against this policy shift. All readjustments on export tax rebates will go into effect as of July 1st 2007.

(Sourced from MySteel.net)

Gerdau acquires Sizuca mini mill in Venezuela

The Gerdau Group has acquired Siderurgica Zuliana CA, the third largest steel producer in Venezuela for USD 92.5 million.

The Sizuca, located at Ciudad Ojeda 50 miles from Maracaibo, is a mini mill and producer of rebar, has an annual installed capacity of 300,000 tonnes of steel and 200,000 tonnes of rebar. With 340 employees, Sizuca is focused on the domestic market.

Mr André Gerdau Johannpeter CEO of Gerdau said “Venezuela has an expanding economy and growing domestic demand, as well as a great availability of energy, scrap and ore. This investment represents an important step in the growth of Gerdau Group on the American continent.

Kobe licenses ITmk3 iron nugget process to Cleveland-Cliffs

Cleveland-Cliffs Inc announced that Kobe Steel has agreed to license its patented ITmk3 iron making process to the company. The alliance has a 10 year term and covers use of the proprietary process in the United States and Canada, Australia and Brazil and may be expanded to include other geographic regions. The companies have also agreed to participate on a JV basis as strategic equity partners in a 500,000 tonnes per annum iron nugget facility to be constructed at one of Cliffs' United States mining properties.

Mr Joseph A Carrabba chairman, president & CEO of Cleveland-Cliffs said "One of Cliffs' major strategic initiatives is to sustain its leadership position in pioneering processes related to metallics. By constructing a commercial scale facility that will produce iron in nearly pure form, we will further that mission and be able to offer North America's non integrated steel mills a consistently available and very high quality domestic metallic feed, which is similar in quality to imported pig iron. Moreover, as Cliffs currently sells the majority of its pellets to integrated steel companies in North America, this opportunity has the potential to open a new market.”

He added that "We have been very interested in this technology since successfully testing the process in a pilot plant located at our Northshore facility. The alliance with Kobe moves us closer to realizing our mutual goal of commercializing and exploiting this innovative process."

The ITmk3 process is used for the production of high purity iron nuggets containing more than 96% iron. This provides means to manufacture high quality raw materials for electric arc furnaces.

Nickel slides down as fundamentals ease

Nickel at London Metal Exchange tumbled to a fresh four month low on Tuesday as technical selling extended on earlier long liquidation.

Nickel on LME slid by 7% from Monday to a low of USD 37,500 per tonne. LME data Tuesday recorded nickel stocks at 9,276 tons, inching closer to the psychological 10,000 tonne level and nearly double of the month ago levels.

LME nickel has fallen some 20% since the LME announced that that it was amending its nickel lending guidance June 7th 2007 in hopes of preventing disorderly market activity.

MMK net income in Q1 up by 41.1% YoY

Magnitogorsk Iron and Steel Works has announced consolidated financial statements for the 1st Quarter of 2007, reported in accordance with generally accepted accounting principles in US GAAP.

The OJSC MMK Group's gross revenue in the 1st Q of 2007 has grown to USD 1.845 billion up by 51.7% YoY as against Q1 of 2006. Its operating income increased to USD 449 million up by 53.8% YoY accounting for 24.3% of the gross revenue. MMK's net income has grown by 41.1% YoY to USD 350 million accounting for 19% of the revenue and EBITDA has reached USD 507 million or 27.5% of the revenue.

In the 1st quarter of 2007, OJSC MMK produced 3,145 million tonnes of crude steel and sold 2.930 million tonnes of commercial products, a YoY increase of 8.9% and 11.7% respectively. The average price of steel products sold by OJSC MMK in Q1 of 2007 was USD 536 up by 24.7% YoY or USD 106 as compared to Q1 of 2006.

MMK Group sales by product

In million USD

Nissan agrees for 10% hike in steel prices with Nippon Steel

It is reported that automotive giant Nissan has recently agreed to steel price increases of more than 10% for specialty steel used to make auto parts from its major steel supplier Nippon Steel.

The Nikkei business daily newspaper also reported that the two companies are also likely to agree to a price rise of around 5% for steel sheet used to make car bodies.

Sidor agrees on lower domestic steel price in Venezuela

It is reported that an understanding has been reached with the board of private steel maker Sidor and Venezuelan government to lower prices in the domestic market.

Mr José Khan minister of basic industries & mining of Venezuela said that following several meetings between Mibam, the ministry of light industries & commerce and representatives of Techint an agreement was reached.

As per report, Sidor has agreed to three levels of prices. A price for raw material, which will be a cost price to help shore up Venezuelan economic growth plans. There is a second price, which would be offered for cooperatives and a third price for the normal domestic price.

Wuhan Steel breaks ground for CSP project

It is reported that ground breaking ceremony, to marks the foundation excavation for WISCO’s converter CSP project has started on June 18th 2007.

The project comprises of two new 150 ton converter, two thin slab caster and a seven rack mill production lines designed for production of 2.53 million tons. The project built by the Wuhan Iron and Steel Group for the construction of flats will be built and put into operation in 2008.

According to the briefing, "CSP" production process is the contemporary world steel industry development of a major new technology, 10 years, with investment, low cost, energy efficient and rapid development advantages. At present, the world has over 40 CSP plants, a total of 70 production lines, Total production capacity is over 70 million tons. China’s seven iron and steel enterprises have also completed more than 10 production lines.

No major upturn in EU prices expected in Q3 – MEPS

MEPS reported that EU strip market is relatively quiet ahead of the conclusion of price negotiations for third quarter business. MEPS said that “Service centers are well stocked until September and are in no rush to settle. Traders are waiting for new offers from Chinese mills following the recent changes in export taxes and EU steel makers appear to be controlling production in line with demand quite well.”

MEPS said that German buyers are in discussions over period three deliveries but nothing has been fixed yet and they expect to finalize during the second half of June. It said that “A number of market players do not expect to pay any more than in the second quarter. They believe that the large quantities of third country material sitting at the ports together with the lower prices being offered by Italian producers will influence the outcome. Moreover demand will cool ahead of the holidays.”

MEPS added that French prices for late second quarter deliveries of strip mill products are showing signs of weakness and there is an air of uncertainty in the market place. It said “Negotiations for period three have not started yet. Producers confirm they are now looking for a smaller increase of EUR 10 to EUR 15 per tonne compared to the EUR 20 to EUR 30 per tonne initially proposed. Stocks are higher than is customary and demand only average. The expected improvement in the auto industry has not materialized.”

MEPS said although real consumption is just about normal, the Italian market is quiet as many customers are fully covered until September. It said that “This has resulted in lower domestic prices for all flat products. A great deal of foreign material is in the ports and warehouses and more is due to arrive. Some traders still have Chinese material contracted to be delivered at prices settled before the new tax reforms were established. They are unsure of what will happen to these orders now.”

MEPS said that “A decrease in new offers from Chinese suppliers appears to have encouraged Corus to look for higher basis prices in the third quarter. A number of buyers have been informed that they will have to pay substantially more. Period three values will also see some adjustments to extras when the company implements its new price list from July 1st 2007. Therefore, customers are reluctant to place forward orders. Stock levels are reasonable. Most of the third country material at the quayside is believed to be sold and companies have taken those tonnages into account when assessing their inventories.”

MEPS also added that Belgian stocks are on a good level with huge quantities of flat products standing at Antwerp with insufficient de coiling capacity to move the material on. It said “A lot of this steel has arrived late having been bought at quite low prices. Demand is down due to the approaching holidays. Customers, concerned about the current high prices are proceeding cautiously. The mills are talking about third quarter increases of EUR 20 per tonne but many buyers do not think the plan is achievable. Large quantities of third country imports already at the docks and also due to arrive shortly are threatening to cause oversupply in the Spanish.”

Metalloinvest & Severstal studying a merge – Report

Reuters cited a senior Metalloinvest official as saying that Russian steel and iron ore company Metalloinvest is studying a possible merger with Severstal.

The report cites Mr Maxim Gubiyev GM of Metalloinvest, in response to a question about whether his company planned to merge with Severstal, on the sidelines of a conference organized by Renaissance Capital, as saying that "Indeed, we are having joint consultations. We are getting to know each other and looking at each other at the level of leadership and shareholders."

However, a source at Severstal told Interfax that Severstal is not discussing a tie up with the Metalloinvest holding. He said "There are no agreements and no talks on a merger.”

Mr Alexei Mordashov CEO of Severstal told Interfax at the end of May 2007 that the sale of Severstal was out of the question. While responding to a question that whether he might sell his shares, Mr Mordashov had told Interfax "It is out of the question. I see my future in the development of Severstal. Most of my capital is tied up with the company and I see the greatest opportunities to create value for myself and for other shareholders right there.”

Weather condition worsen again on NSW coast

Coastal areas of New South Wales are already starting to feel the effects of the third major storm to hit its coast this month as an intense low pressure system is bringing heavy rain and strong winds to the south coast and the southern suburbs of Sydney. The Bureau of Meteorology has predicted wind gusts of up to 100 kilometers per hour along the coast from Nowra to Forster. It will be the fourth time in the last month that gale force winds have hit the coast something that has not happened in more than 30 years.

Mr Barry Hanstrum of the weather bureau said that the storm will intensify overnight and it could cause further erosion to beaches. He said that "Fortunately the weather system is moving quite quickly and so the period of damaging winds will last for only a few hours. There will be seas of 7 meters and with some maximum waves above 10 meters."

The NSW state emergency service still has not finished clearing the damage from last week's severe storms in the Hunter Valley but says that volunteers will be ready if tonight's weather is as bad as predicted. Dozens of coal ships waiting off Newcastle's coast have moved further out to sea to ride out the storms.

Newcastle Port Corporation said that it is concerned about further damage to the MV Pasha Bulker.

Iron ore imports market in China expected to rebound in July-Analyst

Iron ore imports market in China is showing sign of weakening for recent weeks due to the new export tax on steel as most buyers are holding back to gauge the impact of the export levy. As a result, the market price of imported iron ore has slipped CNY 30 to CNY 50 per tonnes from mid May.

Customs statistics indicate that China imported 27.62 million tonnes of iron ore in May 2007 down by 5.74 million tonnes or 17.2% from April 2007. It's the lowest import volume since October 2006. And in the first five months of 2007, China's demand for ore imports increases by 21.4% YoY. The supply and demand imbalance could occur as early as July if ore imports continue to fall down in June.

Although, the export tax has badly hurt the market sentiment but exerted only mild impact on the market fundamental so far and the leading Chinese iron ore importers like Sinosteel and Minmetals are upbeat about the market trend. Market analysts predict that ore imports market is likely to rebound in coming months on back of limited ore imports supply from major origins.

Meanwhile, spot ore import from India one of China's key ore imports suppliers is set to dwindle in coming months as the west coast ports have been closed for the monsoon season. That would result in tight supply of higher grade Indian ore imports in Q3, and prop up the market price to a great extent.

Moreover, the heavy rains in most regions of South China have greatly hampered the mines operation there. Most mines have been closed in Hunan, Hubei and Guangdong due to the flood, with market transactions suffered a sharp decline.

In addition, strengthening demand for domestic iron ore in North China has led to tight supply and depleted stock at local steel mills. The price of domestic iron ore has risen CNY 30 per tonne to CNY 40 per tonnes from early June, with delivery price of domestic ore already coming close to that of ore imports. Some steel makers are considering higher purchase price for domestic ore supply at the moment.

Also, the market demand would also get improved as a number of blast furnaces in Hebi, Shandong, Zhejiang are slated to come on stream in Q3.

Market insiders believe that the delayed demand for ore imports in June would explode in following months as the buyers clear the doubts over the new export tax.

(Sourced from MySteel.net)

Sharp acceleration in global steel production – OECD

Mr Risaburo Nezu Chairman of the OECD Steel Committee at the 62nd meeting of the Steel Committee at Istanbul in Turkey during May 2007 said highlighted the sharp acceleration in global steel production in lat 6 years and made following observations.

1. World production of steel has posted a dramatic acceleration in growth over the last five years. China accounted for more than two thirds of the increase in world steel production seen over the last five years. Chinese production surged from 151 million tonnes in 2001 to as much as 423 million tonnes by 2006. As a result, China’s share of world production nearly doubled over the past five years, rising from 17.7% in 2001 to 34% by 2006.

2. In India, the world’s seventh largest producer of steel, production reached 44 million tonnes in 2006. In the future, Indian steel production capacities and volumes are expected to increase strongly in order to meet demand for steel from a growing industrial sector and expanding infrastructure building.

3. Russian steel production, which grew from 59 million tonnes in 2001 to 71 million tonnes in 2006, is expected to increase steadily over the next few years, supported by growing electric arc furnace capacity that will gradually replace the outdated open-hearth process.

4. The rest of Asia excluding China, NAFTA and the EU-25 has seen their shares of world steel production decline over recent years. Supported by strong Chinese demand for high quality steel products, Japanese crude steel production reached 116 million tonnes in 2006, its highest level recorded since the early 1970s.

5. US crude steel production has increased from 90 million tonnes in 2001 to around 99 million tonnes last year driven by electric arc furnace production. Crude steel production in the EU-25 rose to 198.5 million tonnes last year.

North China accounts for 43% capacity addition in January to April

It is reported that the 28% YoY growth of crude steel production has been highest in North China during January to April 2007, which also has the highest share of 35% among all other regions

In 10,000 tonnes

In other words, North China and mid South areas have contributed significantly to crude steel output growth. North China has added fresh crude steel output of 11.71 million tonnes in the first four months, representing 43% of the country's total addition tonnages.

Market observers believe current volatile market mainly reflected fragile market sentiment, and domestic market balance, global steel price and prospect in upstream and downstream sectors all have yet to show any fundamental change.

(Sourced form MySteel.net)

Severstal reappoints Mr Mordashov as CEO for 3 years

Severstal during its annual general meeting on June 15th 2007 passed several resolutions including election of Mr Alexey Alexandrovich Mordashov as CEO of OAO Severstal for a period of 3 years.

Other directors, elected to the board of Severstal include Mr MV Noskov, Mr AN Kruchinin, Mr VA Makhov, Mr VA Shvetsov, Mr Christopher Clark, Mr Ronald Freeman, Mr Peter Kraljic, Mr Martin Angle and Mr Rolf Stomberg.

During the AGM, Severstal board also approved
1. The Annual Report
2. Annual Accounting Statements including the Income statement
3. Dividends for the 2006
4. OAO Severstal Charter new version
5. Regulations for OAO Severstal Board of Directors new version
6. Election of Mr Roman Ivanovich Antonov, Mr Alexei Igorevich Guryev, and Mr Sergei Nikolayevich Fedoseyev to the OAO Severstal Inspection Commission
7. Approval of CJSC KPMG as OAO Severstal’s Auditor
8. Approval of the interested party transaction between OAO Severstal and OAO Promishlenno-Stroitelniy Bank.

Russia to auction Elga coal field by July

It is reported that Russia plans to auction the largest coal field in the Far Eastern republic of Sakha by July 23rd 2007 to benefit from rising prices for coking coal and that the federal & Sakha governments and OAO Russian Railways, all shareholders in the Elga field, will decide by soon on whether to auction the deposit together with OAO Yakutugol.

Mr Vladimir Shchadov deputy director of the Federal Energy Agency at the Coaltrans forum in Moscow said that the deadline for the auction of the Elga field with the potential to yield 30 million tonne per year is final.

Mr Shchadov said that prices for coking coal have been increasing amid a boom in Asia. He said should the parties fail to reach an agreement on combining the two into a single lot the Sakha government will sell Yakutugol, which operates several coal mines in the Republic of Sakha and is 75% owned by the local government and 25% by Mechel.

Mr Gailey to leave Zinifex at the end of June

It is reported that Mr Greig Gailey CEO of Zinifex Ltd will step down on June 29th 2007 and Mr Tony Barnes CFO of Zinifex's will act as CEO till a new CEO is appointed.

Zinifex said "While Mr Greig's wisdom and insight will be missed the board has total confidence that Mr Tony has the skills and experience necessary to perform the chief executive role in the interim.” It said that Mr Tony has played a key leadership role in Zinifex since its inception and has been integrally involved in the company's current strategic initiatives."

Zinifex said that search is well underway with internal domestic and international candidates all being considered.

Mr Gailey is the latest in a string of high profile resources bosses planning to leave their roles, including BlueScope Steel Ltd's Mr Kirby Adams and BHP Billiton's Mr Chip Goodyear.

Philippine government to support GSPI on duty issue in Vietnam

It is reported that Philippines will seek compensation from Vietnam if it fails to fully and convincingly substantiate the imposition of higher tariffs on the products of Global Steel Philippines Inc. The Philippines has communicated with the Vietnam government to clarify certain points on the data that would validate their claims of transshipment.

Mr Thomas Aquino trade undersecretary of Philippines told reporters that the government would verify allegations of the Vietnam Steel Association that Global Steel was using its Iligan plant as a transshipment point for products coming from its parent in India. Vietnam has to fully and convincingly substantiate its claims. Later on, if needed, we will demand compensation.”

VSA alleged that it was impossible for Global Steel’s cold rolled coils to fulfill the CEPT condition as it only started producing hot rolled coil products in April 2006 on a trial basis. Despite this, import documents claimed shipments of cold rolled coils before this date had 46.9% Asean made content. The association also alleged that Global Steel must have imported hot rolled coils from India.

VSA’s allegation prompted the Vietnam government to slap a 7% most favored nations rate to Global Steel products, instead of the Common Effective Preferential Tariff rates of only 0% to 3% for those coming from member countries of the Association of Southeast Asian Nations. The duty free import provision under the CEPT scheme is extended to products whose raw material is 40% coming from the Asean regional bloc.

The Asean Free Trade Agreement provides that a member country has the option to recoup, via a compensation package, losses incurred by local companies because another country chose to unilaterally impose import duties that are not in sync with CEPT rules.

Norilsk expects LionOre deal by June 28th 2007

Norilsk Nickel expects to complete the acquisition of LionOre Mining International Ltd by June 28, when a rival offer by Xstrata Plc is due to expire.

Mr Denis Morozov CEO of Norilsk told a conference he considered it unlikely that Xstrata would match Norilsk's CAD 6.8 billion bid for the world's 10th largest nickel producer. He said "We consider the return of Xstrata unlikely, though possible. We have a support agreement in place and our offer has been rated as the better offer."

Norilsk's latest offer for LionOre, tabled on May 23, was 10% above Xstrata's bid. Norilsk and LionOre on Friday entered a support agreement that precludes the Canadian company from soliciting more bids and gives Norilsk the right to match any superior offer. LionOre has already advised its shareholders to accept the Norilsk bid.

Steel makers in Southern Vietnam increase prices

It is reported that two major steel producers in southern Vietnam decided Monday to raise prices by 2.2% following a rise in the prices of raw material imported from China. It is reported to be the biggest hikes over the last 12 months.

The Ho Chi Minh City-based Southern Steel Corp has hiked bar steel prices to VND 9.6 million (USD 596) per tonne and rolled steel to VND 9.2 million, a VND 0.2 million per tonne increase in both cases. Japan Vietnam Steel Corp has also raised their prices to VND 9.8 million and VND 9.4 million.

Both the two producers said the hikes were necessitated by a 10% to 12% rise in the price of steel ingots imported from China.

These steel plants have been attempting to raise prices since the beginning of the year. However, demand was very low in the first quarter, while competition from Chinese products was fierce. But their sales picked up unexpectedly last month. Vietnam Steel Association as saying its member companies had sold 324,000 tons, a 36% MoM increase. Previously, China sourced steel was always VND 0.5 million per tonne lower than Vietnamese.

Russian thermal coal account for 15% power generation in UK in 2006

Russian coal exporters to UK must ensure secure supplies to maintain its share of the British energy market. Coal supply from Russia exceeded supply from British mines in 2006 and probably accounted for about 15% of UK electricity supply. Russia, the world's third largest coal exporter and fifth largest producer accounted for more than half of the 42.8 million tons of thermal coal imported by Britain last year.

Mr Nigel Yaxley MD of the Association of British Coal Importers at CoalTrans said that Russia can meet growing demand from expanding coal fired power capacity in Britain, but buyers are concerned about rail links and politics may seek greater diversity in supply.

Mr Yaxley said Britain with over 11GW of new coal fired capacity planned had the potential to increase imports significantly though whether this capacity is built would depend on prices and European Union emissions directives. He said there was increasing concern in Britain over safety and social responsibility in Russia's coal sector.

Mr Sergei Romanov, research director at INKRU, the Russian Coal Market Research Institute, said British consumption of Russian coal had risen more than six fold since 2000.

China to open a new tungsten mine in Hunchun in Jilin Province

It is reported that local governments in Yanbian and Hunchun have signed cooperation agreement on June 11th 2007 with 5 investors including Zijin Mining Group Co Ltd indicating the startup of exploitation of North China's biggest tungsten ore mine.

Tungsten ore mine was discovered in Jilin's Hunchun in 2002 and over 4 year geologic examination indicate tungsten trioxide reserve of some 125,000 tons and prospective reserve of over 200,000 tons. Ore grade averages 0.44% and direct economic value of the total resources amounts to over CNY 15 billion.

After scientific analysis by provincial government, five enterprises became investors of the project, of which Zijin Mining is the holding company in virtue of a 40% share.

Approximately CNY 1.2 billion will be poured into the project. Injected by half of the total investments, the first stage of the project can realize annual capacity of 6,000 tons and sales income of CNY 400 million.

(Sourced from MySteel.net)

Berong Nickel aim to cross 1 million tonne nickel laterite shipment in 2007

Philippines Berong Nickel announced that it has already exported some 350,000 tons of nickel laterite since January 2007. Mr Ramon Antonio Flores resource development manager of Berong Nickel told reporters that “We have made seven trial shipments averaging 50,000 tonnes since the start of the year.” But he did not disclose the total value of the shipments.

Mr Flores said that “By the end of the year, we expect to have shipped out a total of 1 million tonnes. There is a strong demand for nickel for stainless steel products, that's why we have increased our shipments, and we expect prices to hold up over the next couple of years.”

He added that Berong is currently being wooed by at least four different groups in China for the supply of nickel laterite.

London listed Toledo Mining has a 56.1% stake in Berong, Philippine firm Atlas Consolidated Mining and Development Corp has 25.1% and Australia's Investika Ltd. 18.8%.

Timken to raise prices for thermal treated steel from January 1st 2008

Timken Co announced that it is the raising the prices on its double and triple thermal treated steel product.

It said that, effective with shipments January 1st 2008, following would apply
1. Bar product prices will increase by USD 50 per ton
2. Tubing product prices will increase by 10%

Raw material surcharges will remain in effect.

At this time, prices on as rolled and single thermal treated products are not affected.

Temcor secure major contract from Hyundai Steel

It is reported that Hyundai Steel has selected Temcor as the preferred vendor for a USD 16.8 million project covering two 130 meter iron ore blending tanks and three 120 meter iron ore storage tanks at Chungnam in South Korea.

The structures will be designed to accommodate the conveyor systems used in handling bulk materials. The structures will be tower erected each ring built at ground level and hoisted on a center tower system using electro pneumatic cable pullers as each ring is completed. The structures will ship in about 104, 40 foot open top containers through the Port of Savannah beginning in early 2008. This project will book the manufacturing facility located in Rincon for four months in 2008.

Temcor, founded in 1964, designs manufactures and erects architectural and environmental enclosures. These are primarily clear span domes and related space frames fabricated mostly from aluminum. Temcor structures are used for covering tankage of all types as well as architectural applications such as arenas, gymnasiums, theaters and auditoriums.

Kazakhstan steel output in January to May up by 10.7% YoY

Interfax-Kazakhstan reported that Kazakhstan has increased its crude steel output by 10.7% YoY in January to May 2007 to 1.924 million tonnes.

Its output of flat steel products also went up by 15% YoY to 1.404 million tonnes, including 92,737 tonnes of tin mill products up by 14.5% YoY but production of galvanized steel at 246,427 tonnes is down by 1.8% YoY.

As per report Kazakhstan’s ferroalloys production in the five months went up by 3.3% YoY to 703,182 tonnes but coal production reduced by 5% YoY to 36.52 million tonnes.

SinoSteel may invest in a nickel project in Indonesia

YIEH reported that China’s SinoSteel is working on possibility to invest in a nickel project in Indonesia.

Mr Tubagus Farich assistant to the VP of Indonesia during his recent visit to SinoSteel said that the Indonesia government would like to expand all round cooperation in steel field with SinoSteel.

As per report, SinoSteel would also like to have more cooperation with Indonesian organizations.

Raspadskaya to reduce its share capital

One of the Russia’s leading coking coal producers, Raspadskaya announced that it has decided to reduce its share capital. Now the share capital is worth RUB 3.128 million split in 781988249 common stocks of RUB 0.004 par.

Through the coverage of 1188440 common stocks bought back in 2006 from the holders Raspadskaya is going to cut down the share capital to RUB 3.123 million and 780799809 common stocks.

Raspadskaya has 12 coal entities in Kemerovsky region including Raspadskaya Mine, MUK-96, Raspadsky Pid, Raspadskaya Coke Mine, enrichment plant Raspadskaya. Raspadskaya Coal Company is a managing company of the Mine and the major stake holder is Evraz, which has recently announced merger of Raspasdaskya and Yuzukbasugol.

Tianjin No 1 CR project starts construction

It is reported that the commencement ceremony of Tianjin No 1 Steel Rolling Group's CR project with annual capacity of 0.9 million tonnes was held at Dagang District in Tianjin City on June 8th 2007.

The whole project is being executed on EPC basis by China Metallurgical Group Corporation.

Tianjin No1 Steel Rolling Group under Tianjin Metallurgical Group is a state owned steel maker able to making iron, steel and rolled products, steel pipe and strip steel products.

(Sourced from MySteel.net)

Ukrainian GDP up 7.8% in January to May 2007

Interfax citing Mr Valeriy Muntian deputy economics minister of Ukraine reported that Ukrainian GDP rose by 7.8% in January to May 2007.

Mr Muntian said that these dynamics confirm the government's forecast of a 6.5% rise in GDP for 2007.

Ukrainian government has forecast a slowdown in GDP growth in 2007 to 6.5%, together with a drop in inflation from 11.6% to 7.5%.

In 2006, Ukrainian GDP went up by 7.1% as compared to 2.7% in 2005.