SinoSteel moving on with steel project in Jharkhand

It is reported that Chinese steel maker Sinosteel is ready with its blueprint for a 5 million tonne steel plant in Jharkhand and is likely to ink a MoU with Jharkhand government soon. A 2 member delegation of Sinosteel India Private Limited met Mr Sudhir Mahto deputy chief minister of Jharkhand during this week and submitted a proposal for the same.

As we all know that it all finally boils down to the availability of land and the complexities associated with land acquisition, this could just the beginning as SinoSteel will now have to take up the most difficult challenge of acquiring land.

However, Mr Sudhir Mahto said that "We will give them 1,800 acres of land for phase I, they will come themselves to identify the land. The delegation said that it was interested in purchasing land from private owners. We have yet not committed to sign a memorandum of understanding with the company. We will go through the proposal thoroughly before giving a go ahead nod.”

Mr Hongsen Wang MD of SinoSteel India also told reporters that "We will be satisfied with 2,000 acres, but for expansion we will need 3,000 acres to 4,000 acres.”

As per report, the project would be completed in three phases. The first phase will have an initial capacity of 1.5 million tonnes, to be set up with an investment of INR 3,500 crore, second phase will entail plant of another 1.5 million tonnes at a cost of INR 3,000 crore and third phase will set up a plant of 2 million tonnes with investments of INR 5,000 crore. The whole process will take about 5 years and the full capacity of 5 million tonnes will be achieved by 2012.

SAIL & KIOCL’s Taldih iron ore JV on track

It is reported that mining plan for iron ore mining by a JV of Steel Authority of India Limited and Kudremukh Iron Ore Company Limited, at Taldih mine in Sundergarh district of Orissa has been submitted to Indian Bureau of Mines at Nagpur. Meanwhile, MECON has prepared the feasibility report of the project.

Taldih mine is estimated to have 238 million tonnes per annum iron ore reserve and constitutes the middle portion of Barsua Taldih Kalta area where SAIL has got 2486.39 hectares of mining lease. SAIL has already got the mining lease in the Barsua-Taldih-Kalta area, one each at Barsua and Kalta, flanking Taldih blocks, and are already operational.

It was reported in August 2006, that SAIL had decided to invest INR 1,300 Crore for developing an iron ore mine at Taldih in Barsua-Taldih-Kalta area Orissa. SAIL entered into a MoU with KIOCL to develop the same for supply of up to 4.25 million tonnes per annum of iron ore including two million tonnes of pellet and had appointed MECON as their consultant.

5 feared dead in landslide at illegal coal mine at Purulia in WB

Express News Service reported that at least 5 persons are feared dead in a landslide at an illegal coal mine at Dangajote near Bhamuria in Purulia district of West Bengal. As per report, the landslide was triggered by incessant rain in the area last night.

The report cites local police as saying that 2 persons managed to come out from under the debris and escape death and are undergoing treatment.

As per report, these people were as usual engaged in digging coal from the mine which had been declared illegal by the Union government in 1975. Illegal coal smuggling, under the control of local coal mafias, is reported to be operating 10 such illegal coal mines in the area.

Essar Steel Caribbean inks long term gas supply contract with NGC

Trinidad and Tobago’s News Day reported that Trinidad and Tobago Limited’s National Gas Company has signed a long term gas supply contract with Essar Steel Caribbean Limited for the supply of 140 million cubic feet per day of natural gas. As per report, Mr Frank Look Kin president of NGC and Mr PR Dhariwal MD of Essar Steel Caribbean signed the contract.

During the contract term, NGC will supply Essar Steel Caribbean with natural gas to its iron and steel complex which will be located on a 200 hectare site on the South East extension of Point Lisas Industrial Estate. This contract will represent a doubling of existing gas utilization by Essar Steel Caribbean and the additional gas sales will increase NGC’s gas sales volume by about 8% with plant start up in 2009.

As per report, Essar Steel Caribbean’s new complex’s annual production will include 4.5 million tonnes of pellets, 3 million tonnes of hot briquette iron and 2.5 million tonnes of hot rolled coils. In addition, the end product of flat steel will be available for use by other local downstream industries. Construction of the complex is expected to begin in 2007 at a cost of USD 1.7 billion.

NTPC to tap capital market to fund expansion plans - Report

Times News Network reported that India’s power giant National Thermal Power Corporation is examining the options of tapping the capital market with a follow on equity issue to mobilize resources for their proposed spend on upcoming power plants. As per report, NTPC also planning a bonus issue and has written to the union power ministry accordingly.

NTPC’s made initial public offer of INR 5,386 crore including the dilution of government stake in the company by 5% 3 years ago. While the size of the offer is yet to be finalized, the report mentions that said it could be same as the previous IPO. NTPC was earlier given a cabinet approval to offer equity up to 24% of paid up capital, which means that it has the option to raise fresh equity capital to the extent of about 14% more.

NTPC has lined up an ambitious program to add fresh generation capacity during 11th and 12th Plan. Its generation capacity is set to be scaled up to 51,000MW from the present level of about 27,000MW by 2012 and further to 75,000MW by 2017 with an investment of INR 160,000 crore. During 2007-08, NTPC plans to make a capital expenditure of INR 12,792 crore. While a large part of expenditure would go on thermal power generation projects, it has also forayed into the hydro sector, besides investing in coal mines.

Chattisgarh’s 2006-07 royalty earnings up by 12.7% YoY

A senior official of the Directorate of Minerals and Mining told IANS that mineral rich Chhattisgarh state has earned a record INR 8.32 billion in royalties during 2006-07 registering INR 940 million or 12.7% rise in royalty earnings as compared to 2005-06.

The official added that nearly 80% of the royalties earned during 2005-06 came from coal, iron ore and bauxite. The coal rich Korba district contributed the highest amount of INR 4.21 billion followed by Koriya district with INR 1.12 billion and Surguja district with INR 750 million.

Chhattisgarh ranks second in India's mineral production. It has about 23% of the India's total iron ore reserves and 18%of total coal deposits. The state also has substantial reserves of bauxite, dolomite and limestone.

Global majors eying Indian Railway’s rolling stock plants

BL reported that private firms may end up owning 74% stake in the new rolling stock manufacturing units for the Indian Railways, which may hold just 26% stake, as per the suggestions given by PricewaterhouseCoopers.

Indian Railways has announced plans to set up four new factories to meet rolling stock requirements. They include two for manufacturing locomotives one for 150 diesel locos and another for 120 electric locos per year. The others are a unit for 1,100 passenger coaches and another to manufacture 100,000 wheel discs per year.

AS per reports, global players including French Alstom, Canadian Bombardier, US headquartered GE, Germany’s Siemens and Russian Transmashholding have approached the Railways and are showcasing similar JV undertaken by them in other countries. However, these firms, while evincing interest to set up units in the country, have called for duty concessions and assured long-term demand from the Railways.

PwC is advising Indian Railways on the strategy for enhancing its rolling stock capacity, which is currently heavily lagging behind the demand by setting up manufacturing plants for locomotives, coach and wheels through private participation. PwC has also been entrusted with the job of working out the documents including qualification criteria, request for proposal, bidding and selection processes.

Currently, the Railways operate as a vertically integrated entity, with locos, coaches and wheels being entirely produced by departmental units. These include loco works at Chittaranjan & Varanasi, the Integral Coach Factory at Kapurthala & Perambur. And it is only the wagon segment that has private players such as Texmaco and Jessop.

Pipavav Port’s phase II to be commence by 2008

Projects Today reported that the development work of phase II of Pipavav Port in Gujarat is progressing in full swing and completion is scheduled for March 2008.

The AP Moller & Maersk JV plans to invest around INR 1,500 crore for developing a container terminal at the port in 2 phases.

In phase I which was commissioned in December 2004, the terminal offered 3 quay cranes with 395 meters of quay length, 13.5 meter draft alongside.

In phase II, a new container berth of 350 meters will be developed having a draft length of 14.5 meters.

Linc Energy inks JV with Shiv Vani for UCG & GTL project in India

Australia's Linc Energy Ltd has signed a MOU with Shiv Vani Oil & Gas Exploration Services Ltd for setting up a JV to develop underground coal gasification and gas to liquids projects in India. One of the immediate goals of JV is to get and develop coal blocks that the Indian government is likely to release in 2007 for the specific purpose of underground coal gasification development.

Mr Peter Bond MD of Linc Energy said that "India is one of the new economic powerhouses in the world and we see great application for our clean coal technology and for the generation of electricity linked to our UCG process. The MOU will provide for the establishment of JV between Linc Energy and Shiv Vani in the field of UCG with the aim of utilizing the UCG gas for power production, and in the medium term, coal to liquids diesel fuel production."

Mr Padam Singhee director of Shiv Vani said that the UCG technology developed at Chinchilla coalfields in Queensland by Linc Energy is suitable for the untapped coal reserves in India.

Linc said that approximately 32,000 tonnes of coal was gasified with a high availability of product gas for 30 months from December 1999 through to mid 2002. It's UCG to GTL demonstration plant at Chinchilla is scheduled to open in the third quarter 2007.

The Indian coal ministry has finalized the guidelines for allocation of coal and lignite blocks for the UCG projects and hopes to offer blocks for UCG and coal liquefaction by September 2007.

Mahindra Forgings to become 2nd largest player

India’s leading forging manufacturer Mahindra Forgings Ltd announced that the proposed merger with its 3 subsidiaries will propel it to the position of 2nd largest forging player in the Indian market with the combined turnover of INR 2,000 crore based on 2006-07 financials.

The merger plan involves merging the 3 entities namely Mahindra Stokes Holding Company Ltd, which owns 100% of Jeco Holdings AG, Mahindra Forgings Overseas Ltd that owns 100% stake in Schoneweiss & Co GmbH and Mahindra Forgings Mauritius Ltd which owns 99.8% of Stokes Group Ltd into Mahindra Forgings Ltd.

After the merger Jeco Holdings AG, Schoneweiss and Co GmbH and Stokes Group Ltd, would become close to 100% subsidiaries of Mahindra Forgings.

According to the swap ratio, 103 equity shares of INR 10 each of Mahindra Forgings would be issued for every 20 shares held in MSHCL. Mahindra Forgings would allot 49 equity shares for every 20 fully paid up shares of INR 1 each in MFOL, and 73 shares for every 20 equity shares of INR 1 each held in MFML. The proposed scheme is subject to shareholders and other requisite approvals.

US Steel shares jump on report of talks with ThyssenKrupp

In the steel arena, you never know who will buy whom. For now, the spotlight is on United States Steel, whose shares jumped by 8% on Friday amid rumors that ThyssenKrup is interested in buying the company. US Steel rose USD 9.25 or 8% to USD 125.05 at 4:29PM in New York Stock Exchange composite trading the biggest gain since November 17th 2006. The stock has doubled in the past year.

Interfax, citing a baker reported that, German steel giant ThyssenKrupp is interested in buying US Steel or Russia's OAO Severstal but Pittsburgh based that US steel is more likely target. Interafx cited the source as saying that "They are interested in two companies Severstal and US Steel and are holding talks with both of them. US Steel is the more likely candidate so far. Citigroup is Severstal's consultant in the talks while JPMorgan Chase & Co is US Steel's adviser.”

Mr John Armstrong US Steel spokesman said that this is a market rumor and we don't comment on rumors.

Ms Natalia Ivanova a spokeswoman for Severstal in Moscow said that the company won't comment.

US Steel poured about 23 million tons in 2006, according to the International Iron and Steel Institute. US Steel traces its history back to 1901, when a group including JP Morgan and Andrew Carnegie formed the Federated Steel Co. In its first full year of operation, US Steel made 67 percent of all steel produced in the United States.

Ms Monica Bonar an analyst at FitchRatings in New York said that ThyssenKrupp has keen interest in expanding in the US. She said “ThyssenKrupp has long had an interest in expanding in the US. They would be most interested in the US operations. US Steel is a very good asset with a reasonable cost position and access to its own coke and iron ore, which are a key competitive advantage.''

ThyssenKrupp announced plans for the US plant after failing to acquire Dofasco Inc and is building a USD 3.7 billion plants in Alabama that will open in 2010.It is also scheduled to build another mill in Brazil. Acquiring US Steel would help ThyssenKrupp close the gap on ArcelorMittal and give ThyssenKrupp access to mills in North America and Europe and iron ore mines in Minnesota.

Norilsk’s 2006 net profit up by a record 154% YoY to USD 5.9 billion

The world's largest nickel and palladium miner Norilsk Nickel has announced that its 2006 net profit was recorded at USD 5.965 billion up by 154%, although it includes the sale of a stake in South African miner Gold Fields Ltd. Its revenues rose by 61% to USD 11.550 billion in 2006.

Norilsk, which mines a fifth of the world's nickel, said that its sales of the metal yielded an average USD 24,081 per tonne in 2006 up by 65% YoY as compared to 2005. Norilsk also profited from an 83% rise its average copper price to USD 6,689 per tonne. The price of palladium rose by 57% and platinum by 26%.

Norilsk's physical sales of nickel rose 5% to 257,000 tonnes. Palladium sales were practically unchanged at 3.22 million ounces while sales of copper declined by 6% to 424,000 tonnes and platinum by 1% to 750,000 ounces.

Analysts said that they expected the Norilsk to post strong results in 2007 despite a possible decline in nickel prices as its newly acquired refinery in Finland will add to production. Mr Denis Nushtayev an analyst of Metropol Group metals said that "Nickel prices have started declining, which may have a negative effect on the company's results, but 2007 will be a good year for Norilsk after it consolidates its Finnish assets."

Its purchase of the nickel assets of US based OM Group in 2007 including the Harjavalta refinery in Finland is expected to boost 2007 output to 270,000 tonnes to 275,000 tonnes. Norilsk is also expected to gain control of LionOre Mining International Ltd after the Canadian miner advised shareholders to accept its USD 6.4 billion bid.

Japanese Yamato Kogyo joins GIC for H beam plant in Middle East

JMB reported that Japanese Yamato Kogyo announced that it has signed a letter of intent with Gulf Investment Corporation of Kuwait’s subsidiary Gulf Industrial Investment of Bahrain to establish H beam making joint venture with annual 600,000 tonnes of output capacity in Middle East.

Yamato Kogyo said that they would start a study to build integrated plant from direct reduced iron to H beam in the growing market in Middle East.

Wuhan terms allegations of steel dumping in US unfair

China's 3rd largest steelmaker by market value, Wuhan Iron & Steel Co announced that allegations of Chinese steel makers dumping their products in the US are unfair. Mr Zhao Hao Secretary of Whuan said that Chinese steel exports have soared because of higher global prices and demand.

He however added that “Wuhan Steel would not be affected by the dumping allegations because it has reduced exports to the US and increased shipments to regions such as South East Asia.”

North American steel producers filed petitions with US regulators asking for import duties on welded standard pipe from China alleging the Asian nation is unfairly subsidizing and dumping steel products.

Australia's east coast storms ground coal bulk carrier off Port of Newcastle

It is reported that a 40,000 tonne coal carrier has been washed onto a sand bank from the port of Newcastle on Australia's east coast after stormy Tasman seas ripped the vessel from its moorings. The crew has been airlifted from the vessel by helicopter.

The 820 foot long MV Pash Bulker with 22 Filipino crew members was waiting to load coal at Newcastle when a sea surge caused its moorings to break. They also added that there is no immediate risk of the ship breaking up. However some reports said that the ship has already begun to leak oil and there are concerns that it could break up in the heavy seas, creating a real disaster.

Mr Joe Tripodi transport minister of NSW told ABC radio that 3 other coal ships have sent distress calls and are at risk of foundering as the weather conditions could worsen.

Newcastle Port Corporation said that a tug has been sent to assist MV Betis, anchored about two nautical miles off Swansea, that risks running aground near Newcastle. Also being monitored is the MV Sea Confidence, which is less than one nautical mile from Stockton Beach and MV Coral Emerald about 2.8 nautical miles off the same beach.

The vessels are among a queue of 54 ships waiting to load coal off the port which has suffered from infrastructure constraints as demand for coal in Asian markets continues to rise.

NDRC asks for 2nd list for capacity elimination

China's top planning body National Development & Reform Commission recently convened a meeting with local officials from 18 provinces & regions and Baosteel urging them to hand over lists of outdated iron and steel capacities that should be closed. Officials with the first 18 provincial governments were present at the meeting, together with leaders from Baosteel.

However details about the timeframe for the new list have yet to be revealed. Tianjin, Inner Mongolia, Jilin, Heilongjiang, Anhui, Fujian, Hubei, Hunan, Guangdong, Guangxi, Chongqing, Sichuan, Guizhou, Yunnan, Sha'anxi, Gansu, Qinghai, Ningxia and Shanghai are the 19 regions in question.

Mr Zhang Guobao deputy director of NDRC said that outdated iron and steel capacities are hampering efforts to consolidate the industry and in turn affecting the development of more advanced steelmaking capabilities. In the period from January to April 2007 the combined market share of China's top ten mills decreased on a YoY basis from 35.9% in 2006 to 34% in 2007.

A source with the Tianjin Development & Reform Commission indicates that it has started collecting information about outdated capacity and the China’s central government will release all details when local governments sign responsibility agreements with the NDRC to ensure their mills closure.

China aims to close 30 million tonnes of outdated iron making capacity and 35 million tonnes of crude steel capacity in 2007. The first list issued in April 2007 covered 10 regions. The first list for this year covered some 23 million tons of iron making and 24 million tonnes of steel making capacity, representing 72% of the obsolete capacity slated to be closed in 2007.

(Sourced from MySteel.net)

Russian coal exports to start tapering 3 years

Reuters reported that Russian coal major SUEK said that Russian coal exports are likely to start falling from 2009-10 in favor of domestic demand.

The report cites Mr Igor Gribanovsky director of SUEK as saying that Russia's rail costs to port are going to rise by USD 7 a tonne during the next 3 years from the current USD 36 a tonne, port handling charges are also going to increase and at the same time Russia's domestic demand for coal is mounting.

Russia's government has decided to reduce gas consumption in power generation and increase coal use to maximize gas exports. Mr Igor said that this will require an extensive building of coal fired power generation capacity, totaling 40GW to 50GW between now and 2020. Mr Igor said that Russia's domestic demand of coal will rise from a current 130 million tonnes a year to 326 million tonnes by 2020, under one scenario. He said that a more cautious scenario forecasts domestic demand rising to 252 million tonnes by 2020. In any case, demand will at least double.

Mr Igor said that "I think from 2009 there will be some fall in exports, a little bit, but from 2010 we will see a bigger fall. I think exports could fall to around 50% of current levels in about four years time. While we can make money by exporting now, but I can see in a few years we are likely to be able to get better prices from domestic sales than we can get for netback export prices."

Chinese plate export prices continue to rise

Chinese domestic steel plate prices are likely to remain firm in June 2007 but export prices have firmed up.

In shanghai, Q235B 14mm to 25mm HR plate are being offered at CNY 4200 per tonnes as compared with CNY 4220 per tonnes in early May 2007. While ship plate prices are still on the rise. CCSA ship plate of 6mm in 1800mm to 2000mm width and 8mm, 12mm to 20mm in 1800mm to 2000mm width and 8000mm length are being quoted at CNY 5550 per tonne and CNY 5130 per tonne up by CNY 150 per tonne and CNY 160 per tonnes respectively than that in May.10th 2007.

Export quotations continue to go up following the implementation of export duty policy. Most steel makers raise prices by at least by 2.5%, half of the export tax rate while some even added full 5%. A East China based steel producer said that they now adding 3% to 4% for those plate under 50mm and by 5% for those heavy plate with thickness above 50mm. A steel mill in central China has raised its S275JR plate offer to about USD 720 per tonnes FOB from USD 700 per tonnes. Those tier one steel makers are quoting at higher level of USD 730 to USD 740 per tonnes FOB. S335JR material even have shoot up to USD 770 per tonnes FOB. While a tier two steel maker in Tianjin is tagging at around USD 650 to USD 660 per tonnes up from USD 620 to USD 630 per tonnes at which level they have concluded business in late May 2007.

Ship plate export prices are always on the rise since 2007. A central based major steel maker indicates that they are now offering GL 1428mm x 2500mm x 8/9m at USD 740 per tonnes which compares with USD 580 per tonnes FOB in end February 2007. Actually its offer is regarded as competitive since there are steel mills offering at USD 760 per tonnes FOB and up.

Market sentiment is that plate price would keep going up or at least be firm, bolstered by robust demand and limited supply. Steel makers are not willing to export more products since they could enjoy more profit in the Chinese domestic market since this April 2007 when China remove all the export rebate tax for plate exports. But some traders believe that commercial plate would face some downward pressure given that other flats and long product prices are stepping down. The decrease for steel plate prices would lag behind about 2 to 3 weeks, according to a domestic trader.

At the same time, there is news that Chinese government has decided to remove export tax rebate for non motor vessels, like bulk vessels, and tugs etc. This is believed to impose adverse effect on ship plate price in the future since this would discourage vessel exports.

(Sourced from MySteel.net)

South Korea’s 2007 steel production to cross 50 million tonne mark

Korea Iron and Steel Association announced that South Korea's steel production is expected to exceed 50 million tonnes for the first time in 2007.

KISA said that the steel output grew by 9.6% on an annual basis from January through April 2007 to 17.01 million tonne and that if this pace continues, total steel production could reach 50.13 million tonnes by 2007 end. IISI figures released are in variance with KISA’s numbers.

KISA said that the output should allow the country to hold onto its fifth place global ranking after China, Japan, the United States and Russia. South Korea Ranked 5th, Germany ranked 6th and India Ranked 7th are running neck to neck. But as German growth is likely to be limited, India, with several steel capacities coming on stream, could give a close fight to South Korea for 5th spot.

In million tonnes
Source IISI

South Korea's steel production surpassed 10 million tons in 1981 and this doubled in 1989. It reached 30 million tons in 1993 and 40 million tons in 1997.

Mechel teams up with Danieli to modernize its steel plants

Mechel announced an agreement with Danieli to provide for the modernization of Mechel's steel operations. The agreement follows a meeting between Mr Igor Zyuzin CEO of Mechel's and Mr Gianpietro Benedetti chairman &CEO of Danieli during a visit of a delegation of specialists from Danieli to Mechel.

The agreement between Mechel and Danieli include the re equipment of Chelyabinsk Metallurgical Plant's electric arc furnace No 6 with modernization of its continuous caster to multiply its productivity by 3.5 times to 4.5 times to 1.2 million tonnes of slabs annually, commissioning of a ladle furnace and a vacuum vessel.

Implementation of the project will allow Mechel to increase its output including stainless and construction steel products with concurrent improvement of quality and reduction of production costs.

Mr Vladimir Polin CEO of Mechel Management OOO said that "Mechel's long term technical re equipment program is based on state of the art technologies in the field of steel production. We are confident that collaboration with world leading equipment engineering companies such as Danieli will enable Mechel to achieve its strategic objectives set to improve the performance of its steel segment by implementing modern technologies for steel melting and casting as well as modernizing its rolling production and finishing."

Mechel and Danieli have had a longstanding collaboration which has included projects for two continuous casting machines of 1 million tonnes capacity each successfully commissioned over the last 3 years.

China to build largest blast furnace in Caofeidian

It is reported that China’s largest blast furnace New Shougang will be constructed at Caofeidian industrial zone. Mr Xue Boxun deputy director of Caofeidian Management Committee said that “The construction of New Shougang is not just move of previous one. We want to build a Steel City with worldwide advanced technology. The Shougang Group will aim at realizing circular economic development.

Mr Xue further added that “Six factors, coal, iron, steel, oil, road and port, gather in one place. Currently this only exists in Caofeidian. Caofeidian would focus on 4 major industries namely steel, petrifaction, heavy equipment manufacturing and port logistics. Besides, the industrial zone also develops Shougang Caofeidian tour route, mainly to display fashionable, modernized and high quality enterprise culture.”

New Shougang absorbs a batch of biggest and most advanced equipments in the world as well as hundreds of advanced technologies, including two 5500 meter cube blast furnaces that would be largest in China. So far there are only 4 furnaces of this kind all over the world. It will also widely adopt new technologies such as energy saving consumption reducing, antifouling and recycling.

(Sourced from MySteel.net)

Xstrata plans to cut greenhouse emission within 3 years

It is reported that Mining giant Xstrata has outlined plans to significantly cut greenhouse gas emissions from its coal mines within three years.

Xstrata newly released 2006 sustainability report says Xstrata is establishing intensity measures for greenhouse gases at all of its operations. It hopes energy efficiency programs will be in place at its coal mines by the end of 2008. The report also commits to a greenhouse gas reduction target with the company hoping to reduce emissions by 5% per tonne of raw coal by 2010.

Xstrata spokesman says all forms of power including fossil fuels renewable and nuclear will be needed if future energy needs are to be met.

But a Newcastle University Environmental scientist says the plan does not go far enough. Dr Glen Albrecht says the plan is laudable but inadequate. He said "What they're doing now is small cheese and the moves that Xstrata is making are certainly good for public relations but are not really going to address the big issue of actually reducing our use of fossil fuels."

Malaysian steel industry wants pricing solution

Malaysian StarBiz reported that top steel mills in Malaysia want to see an effective solution to bring the local sector back on par with its counterparts regionally in terms of pricing. An interim solution, given the current conditions, would be to adopt the automatic price mechanism, while a long term one would be the lifting of the Government controlled price on steel bars and billets steel mills.

Mr Anthony Chin of Lion Group, which has three mills Megasteel Sdn Bhd, Amsteel Mills Sdn Bhd & Antara Steel Mills Sdn Bhd, said that “Many countries in the Asia Pacific region had no control policy on steel prices. The increase in steel bar price from an average of MYR 1,500 to MYR 1,800 per tonne is not reflective of international bar prices currently around USD 600 or MYR 2,100 per tonnes." He added that the benefit of the recent price increase for billets and steel bars were mitigated by rising costs of scrap consumables and utilities.

Mr Allen Tee of Amalgamated Industrial Steel Bhd said that “The Ninth Malaysia Plan would spur business activities but with the Asean Free Trade Area and World Trade Organization in place, the whole scenario and business landscape had altered, introducing more competition locally. The risks for steel pipe manufacturers include no alternative supply source, competition within the country, price cutting given too many producers and external competition in the form of influx of imported pipes at prices lower than local steel pipe makers' costs.”

Mr CB Koay of Southern Steel Bhd said that “Automatic price mechanism should benefit the industry in the long run as it allowed local steel prices to follow the upward or downward trend of international prices. Local steel millers will have to be efficient to tackle steel prices when they come down and contractors will have to be able to handle the situation when steel prices rise.”

Mr Datuk Lim Hong Thye of Ann Joo Resources Bhd said that “The revised prices of steel bars and billets were lower than the international steel prices. I believe steel bars represent just a small fraction about 5% to 8% of the construction cost. The steel bar price is not something that steel millers planned to artificially jack up but the volatile international steel prices local millers had to wait for almost three years before the Government revised ceiling price last month.”

Mr Au Hah Chye of Choo Bee Metal Industries Bhd group said that “The general consensus was that steel prices had peaked and were stabilizing. Price movements if any were likely to be marginal in the short term. Outlook for the mid term is that prices should still be firm, especially with China's reduction in export tax rebate.”

Kobe steel develops antibacterial Kenifine coating

It is reported that Fuji Trout Hatchery at the Shizuoka Prefectural Research Institute of Fishery and Kobe Steel Ltd have commercially applied an antibacterial coating that improves the sanitation of fish hatchery equipment to control parasitic water mold.

As per report the antibacterial coating is being used at a commercial fish farm in Yamanashi Prefecture and several others in Shizuoka Prefecture since autumn in 2006 fish from these farms have been shipped to market. Using the antibacterial coating called kenifine developed by Kobe Steel, it is now possible to reduce the amount of expensive veterinary medical products used so far to maintain the sanitation of hatchery equipment at fisheries and control parasitic water mold.

Kenifine is electrolytic plating contains nickel and trace amounts of other elements that has outstanding antibacterial properties. It is effective at controlling microorganisms in comparison to conventional surface treated products such as antibacterial paint and antibacterial stainless steel. Highly resistant to corrosion in fresh water the alloy coating also has outstanding antifungal and antifungal characteristics. Kenifine has also passed various safety tests including acute toxicity tests set by the Society of Industrial Technology for Antimicrobial Articles. In 2004 kenifine received the 27th Technical Development Award from The Japan Institute of Metals.

Kobe Steel Group company Shinko Wire Company Ltd and its subsidiary Shinko Wire Stainless Co Ltd are producing stainless steel wire plated with KENIFINE for use in hatching nets. Until now, nets have been plated after being woven. However, film formation at the points where the steel wires cross is difficult and becomes a breeding ground for bacteria. Plating the wire first before making the nets solves this problem. Kobe Steel aims to introduce the kenifine coating throughout Japan in a wide range of fields to contribute to fish farms and food safety. It also aims to conduct studies in applying the coating to salt water applications.

China’s Minmetals set to expand in overseas

Shanghai Securities News reported that China’s Minmetal Group is set to extend its presence into overseas mining. The report cited Mr Wang Jionghui GM of Minmetals during a recent mining forum held in Shanghai as saying that Minmetals intends to invest USD 500 million in a mining project in Cuba and the investment would be even larger if including the infrastructure spending.

He said “Minimetals is still in the middle of negotiation. Meanwhile, Minmetals has also obtained an exclusive mining prospect in Jamaica recently.”

Mr Wnag said that "Getting more involved with the capital market is one of our key strategies." However he does not reveal any plan for group listing, and just said they are awaiting the decision from State owned Assets Supervision and Administration Commission of the State Council.

China Minmetals Corporation has increased its shareholding and acquired a controlling stake in Minmetals Yingkou Medium Plate, in northeast China's Liaoning province. It has acquired the shares from the local government. CMC now has about a 70% stake in the plate mill. The remaining shares are distributed amongst Minmetals Development a listed entity of CMC and five privately owned domestic companies.

Market analysts believe that Minmetals can gain a lot of synergies from the takeover deal and would speed up its efforts to expand its presence.

(Sourced from MySteel.net)

Timken’s long steel tube production brings more orders

The Timken Company announced that it has gained new sales after expanding its capabilities to produce long length steel tubing to meet a customer's request. Houston based Dril Quip Inc has placed orders totaling approximately USD 2 million after encouraging Timken to expand its product offering and produce hot rolled, quenched and tempered seamless tubing up to 37 feet long. Timken’s expansion in tube length has led to additional orders with Dril Quip and created the opportunity for other new business in the United States and abroad.

Dril Quip turned to Timken in search of a US manufacturer to provide long length tube for its deepwater riser systems. For this application, Dril Quip requested the tubing for the choke and kill lines, used in deepwater and ultra deepwater riser systems to drill in up to 10,000 feet or nearly 2 miles of water.

In response to the request, Timken’s Gambrinus steel plant in Canton underwent equipment and manufacturing modifications in 2006 to increase tubing length from 31 feet to 37 feet quenched and tempered. The changes expanded Timken’s tube offering from Range 2 (25 feet to 34 feet) to some of the Range 3 (34 feet to 48 feet lengths), as the industry commonly classifies steel tubes.

Mr Ken Heil principal steel sales engineer for Timken said that “This is a prime example of the company’s focus on improving our customers’ performance through collaboration and manufacturing expertise. Whether it’s a product we already make or an opportunity to expand our portfolio to serve a unique customer application, we’ll work to get the job done. Dril Quip came to us with a new challenge, and the end result was a win- win situation for both companies.”

Dril Quip Inc is a leading manufacturer of highly engineered offshore drilling and production equipment which is well suited for use in deepwater, harsh environment and severe service applications.

Congo to diversify mining sector into iron ore and bauxite

Reuters reported that the Democratic Republic of Congo is hoping to diversify its mining sector to exploit its estimated 4 billion tonnes of iron ore and 1 billion tonnes of alumina.

Mr Martin Kabwelulu mining minister of Democratic Republic of Congo while addressing at a metals conference in Namibia said that Congo aims to not only revive its traditional copper sector but diversify by exploiting potentially huge iron ore and bauxite deposits. He said "Diversification of production is a key strategy."

Mr Kabwelulu added that "The government of the Democratic Republic of Congo wants to start a strategy towards new metals, such as iron ore, chromium, nickel, and aluminum. To benefit from these deposits, Democratic Republic of Congo needs to build smelters for aluminum and also a deep sea port.

He further added that Congo has deposits of bauxite and aluminum, in the west of the country near Inga which has good access to the Atlantic coast and probable reserves of alumina are estimated at 1 billion tonnes with of 39% average metal content. Iron ore is found in the northeast of the country, with estimated reserves of 4 billion tonnes with average metal content of 60%."

Congo was once one of the world's biggest copper and cobalt producers but output slumped during years of debilitating civil wars. Only in the last few years have international investors streamed back to the mineral rich nation as increasing stability but last year's successful elections boosted confidence.

Construction of steel plant at Malejan in Iran to begin soon - Report

Iranian media reported that an Iranian private company is to begin construction of the Iran's largest steelworks project at Malekan town in the northwest of Iran in two months.

The report cites Mr Salman Khodadadi a member of Iran's parliament as saying that "The amount to be invested in the construction of the steel mill is approximately USD 300 million and should help the local economy."

He said that the move is considered as a symbol of the government's commitment to developing the private sector. The steelworks is expected to create 2,000 new jobs for residents of Malekan once the plant is launched.

Iran in recent years has been active in promoting competition in its private sector by privatizing previously state run companies and encouraging private enterprises to invest in key economic areas that were previously under government control.

Spark ignites massive fire at Smorgon’s scrap yard

It is reported that a rogue spark is believed to have started as the fire raged through Smorgon Steel's yard at Naval Base. More than 60 firefighters battled the fire for about five hours before bringing the blaze under control at 10PM.

As per report the fire started at about 4.30PM forcing the closure of several roads and leading to a health alert for residents living in the path of the huge plume of smoke.

Mr Mike Klenner spokesman of Fire and Emergency Services Authority said that the fire probably started from a spark caused when a car body was dragged across a concrete pad.