JSPL Patratu plant to start construction in 2007

Ranchi Express quoted Mr Navin Jindal vice CMD of Jindal Steel and Power Limited as saying that construction work of its 6 million tonne per annum steel plant will begin in Patratu this year and production will begin from 2011.

Mr Naveen Jindal said that JSPL would complete land acquisition for its project by 2007 end. He said that "We have got maximum support from the local people. There has been absolutely no opposition from the displaced families or local villagers. The steel plant is expected to generate direct employment for 10,000 locals and indirect employment opportunities for 40,000 others and would also play a key role in the socio economic development of Jharkhand.”

JSPL's Patratu Steel Plant will have a sinter plant of 6 million tonne per annum, HR coil plant of 3 million tonne per annum, wire rod, rebar and structural of 3 million tonne per annum and coke oven of 3 million tonne per annum. JSPL also plans to set up 2 power plants with a total production capacity of 2500MW and intends to invest INR 25,000 crore for setting up the steel plant and power generation plants in the state.

Indian iron ore import prices remain flat last week

The China Chamber of Commerce of Metals, Minerals and Chemicals Importers and Exporters has released on June 9th 2007 the average reference prices for import transactions of Fe 63.5% Indian iron ore concluded last week.

USD per tonne
The change is with respect to the prices posted on July 2nd 2007.

The reference price practice is intended to regulate the domestic trading of Indian iron ore and avoid speculation on the raw material for China's booming steel industry.

Moody’s downgrades TATA Steel rating to Baa2

BL reported that Moody’s Investors Service has downgraded the corporate family rating of TATA Steel to Ba1 or speculative grade from Baa2 or investment grade.

Moody’s Investors Service said that the rating reflects TATA Steel’s weakened balance sheet liquidity and financial profile as a result of its largely debt funded acquisition of Corus Group plc making it the world’s 6th largest steel company with an annual production capacity of 28 million tonnes of crude steel. The total cost of the acquisition excluding Corus’s debts of USD 846 million is approximately USD 12.9 billion.

Mr Alan Greene senior VP of Moody’s said that “The main challenge facing management is to de risk the enlarged capital structure while not neglecting existing operations and opportunities for rapid growth in Asia. The current high leverage, however, constrains TATA’s financial strength and flexibility. Furthermore, TATA Steel’s ambitious capacity expansion plan, will lead to higher project execution risk over several years and materially elevate financial leverage, unless it is deferred. Although the fundamentals of the European and Asian steel industry remain solid, any material decline could further elevate financial leverage.”

Earlier, Fitch has assigned a long term foreign currency issuer default rating of BBB to TATA Steel Ltd with a stable outlook.

Jharkhand to take action against coal firms exceeding their area

It is reported that Jharkhand government has decided to take legal action against the coal companies that have exceeding their area of operation and has asked all the subsidiaries of the Coal India Limited, operating in the state, to furnish the details about their land acquisition including operations.

Mr Dulal Bhuiyan revenue & land reforms minister of Jharkhand has issued an order maintaining that the state government had definite information about overlapping of leasehold areas by the coal companies, which were allotted for mining purposes by the central and state governments.

As per report, these companies are not paying any additional revenue for the extra land.

MSPL Aaress steel plant phase 1 to start in 2009

Baldota Group’s MSPL Limited’s 2.5 million tonne integrated steel plant at Hospet in Karnataka under the name of its group company Aaress Iron and Steel Ltd is being implement in phases.

In Phase I, the company will set up a facility to produce 1 million tonnes per annum of special steel, which will basically be automotive alloys, with an investment of INR 4,300 crore. Completion of the first phase is expected by September 2009.

Another 1.5 million tonnes per annum will be added by 2010 in Phase II, which will produce hot rolled flat products, entailing an investment of INR 4,000 crore. MSPL is still awaiting clearances for the second phase of the plant.

Mr Rahul N Baldota ED of MSPL Ltd said that the steel plant is basically a forward integration of the existing businesses of the company and the first phase is being funded mostly from internal accruals but it is too premature to contemplate on how the funds would be generated for the second phase.

Mr Baldota said that the overall plan is to have a facility of 5 million tonnes by end of 2013. He said “MSPL and the steel company would be two different entities. We may not even use our own ore and may approach other ore extraction companies for raw material to our steel plant. We are against steel companies having their own iron ore mines.”

GoM seeks report on Hindustan Shipyard business plans

It is reported that the India’s Group of Ministers, comprising of Mr AK Antony defense minister, Mr Pranab Mukherjee minister for external affairs, Mr P Chidambaram finance minister and Mr TR Baalu minister for shipping, road transport & highways, formed to take a decision on the issue of restructuring Hindustan Shipyard Limited, has sought a report on the shipyard’s business plans. The report, likely to be submitted within a week, shall address various issues including the extent to which HSL will meet Indian Navy’s demands.

Hindustan Shipyard had been in a financial crisis for many years due to several factors that include poor order book position, lack of working capital, managerial inadequacies and inability to raise funds from financial institutions due to a negative net worth. But, driven by the recent surge in shipping industry, the order book Hindustan Shipyard has improved. The department of shipping had sent INR 799.61 crore proposal to the cabinet secretariat to rehabilitate and revive the shipyard, which now has an order book of INR 2,000 crore and a department related parliamentary standing committee had also recommended expeditious clearance of the proposal.

The Hindustan Shipyard restructuring proposal was referred to GoM by the union cabinet, given Indian Navy’s strategic interests in the region around Vishakhapatnam. Indian Navy, with its eastern command headquartered in Vishakhapatnam plans to set up a new futuristic base near the district on 5,000 acres, located about 50 kilometer south of Vishakhapatnam. The land acquisition process for the base is yet to be completed. The new base is of strategic importance for the Eastern Command to expand its facilities in an exclusive enclave by deepening a natural channel to have easy access to sea. The need to set up a new base arose as the existing channel of Vishakhapatnam port is shared by the Navy and the port has become crowded.

PTC to buy 800MW power from AES Chattisgarh project

US based AES Corporation’s wholly owned Indian subsidiary AES Chhattisgarh Energy Private Limited will sell up to 800MW of power from its under construction 1,200MW coal fired project in Chattisgarh to state run Power Trading Corporation.

AES said that substantial development work has been completed on the project and many clearances have been obtained. The major work left before financial close is allocation of a captive coal mine and the company expects the government to take a decision shortly in this regard. The plant is expected to be commissioned in 2011-12.

Chinese BSG completes contracts for pipe exports to India

It is reported that the last batch of steel tubes made by Chinese pipe maker Baoji Petroleum Steel Pipe Co Ltd has been shipped to India from Shanghai on July 6th 2007, marking the completion of the export contract for 600,000 tons of steel tube.

BSG successfully got the contract for India's East West Gas Transmission Pipeline last year and earned foreign exchange of USD 537 million. This is the biggest steel tube contract in the world and sets a record in exports in China's oil equipment manufacturing.

Founded in 1958, BSG is China's first spiral submerged arc welded pipe manufacturer during the 1st Five Year Plan. In 2006, BSG realized steel tube output of 588,000 tons up by 15.39% YoY, sales revenue of CNY 3.61 billion up by 156% YoY, profit of CNY 200 million up by 164% YoY.

(Sourced from MySteel.net)

INR 2,152 crore plan to fight underground fire in Jharia

Mr Dasari Narayan Rao union minister of state for coal disclosed that center has finalized an INR 2,152.51 crore plan to deal with the underground inferno of the Jharia coalfields.

The much awaited plan to control the underground fire comprises of 45 fire projects and spread over 4 square kilometers of the Jharia township and the adjoining areas, threatening vital installations, including water supply projects and also school and college buildings of the endangered township.

Law ministry to take final call on Essar’s Hazira SEZ

It is recently reported that the law ministry is examining the report of the development commissioner alleging flouting of rules by Essar's SEZ in Hazira to take the final call on the matter.

The report cited a ministry official as saying that "The report of development commissioner was sent to the revenue department, which referred it to the law ministry to decide whether the Essar already had a unit there which was converted in to an SEZ against the rules."

Officials said that since it was difficult to clearly establish whether the activity, which Essar said was related only to the development of the area could be categorized as an industrial exercise. They added that "It is not a cut and dry case and requires interpretation of the Act that is what we need law ministry opinion for."

Under rules, a developer has to file an affidavit stating that the land is vacant and no industrial activity exists at the time of application for an SEZ.

It was alleged that Essar had converted its existing facility into an SEZ, which is not allowed under the Act. Essar, however, has so far maintained that it had invested only INR 60 crore for the development of the site before making an application for INR 1000 crore steel SEZ and this money was spent on site development and no industrial activity had started.

Agitation against Visa Steels called off

SNS reported that an agitation in front of the main gate of Visa Steels in Kalinga Nagar by unemployed youths of Jakhapura village seeking technical employment was called off on July 8th 2007 following an agreement. The agitators under the banner of the Jakhapura Unemployed Association were demanding jobs for the local unemployed, safe drinking water, pollution free environment and tarred roads to their villages. They accused Visa Steels of depleting scarce ground water resources.

According to the bilateral agreement, Visa Steels will engage local people as both skilled and non skilled laborers in its plant on a priority basis. Besides, outsourcing agencies hired by Visa Steels would recruit messengers, peons, drivers and other Class IV employees from among local villagers. The agreement said that in case of ITI certified personnel and diploma holders as well as degree engineers, the company would give priority to land losers during recruitment.

Earlier, management authorities of Visa Steels had requested villagers to withdraw the agitation for some days following the death of 4 family members of Mr SB Singh, executive director of Visa Steels in a road accident.

IRCON to ink rail track laying contract in Ecuador

It is reported that IRCON International Ltd will sign its first contract in Ecuador within a month. Under the USD 50 million contracts, IRCON would lay. It will lay a part of the proposed railway line that is designed to connect the capital Quito to the port city of Guayaquil.

Sources said that Ecuador government wanted IRCON to construct the entire 400 kilometer railway line, but the later said that it would first do a part of it and then see how it goes. IRCON has been asked to complete the construction of the project by June 2008, so that its inauguration could be a part of Ecuador railways’ centenary celebrations.

To the INR 1,500 crore IRCON, which has constructed projects in over 20 countries, the Ecuador project may be just another one, but the significance of the project lies in the fact that it would serve to showcase India’s prowess in railway construction.

Cethar Vessel to set up 2 thermal power plant in Maharashtra

Mr K Subburaj chairman of Cethar Vessels Private Ltd said that Cethar Vessels Private Ltd is setting up two 135MW thermal power plants in Raigad district in Maharashtra at a cost of INR 1,100 crore.

He said the company would take possession of the land at Vhile Bhagar village and the project would be commissioned by June 2009. Initially coal stocks would be imported for the coal based power plant and would be mobilized from nearby pitheads.

Mr K Subburaj said Cethar registered a turnover of INR 1079 crore in the year ending March 31st 2007 and the target for the current fiscal was INR 2,000 crore and would go public before this fiscal end with a launch of IPO with an aim to mop up around INR1000 crore. He said it would also float a new venture Global Engineering Services to render engineering services on automobile, power generation, aerospace, fabrication and construction would be ready before next December.

He said the INR 420 crore expansion programs to increase the capacity of the vessels manufacturing facility from 5,000 MW to 8,000 had commenced in June 2005 and would culminate by March 2008. Cethar Vessels also plans to produce Power Plant turbines at a cost of INR 800 crore with an annual production capacity of 4000 MW. It will be a JV with a foreign partner details of which would be finalized before the month end.

Lanco Energy achieves financial closure for Teesta project

It is reported that Lanco Energy Private Limited has achieved financial closure for the 4x125MW Teesta VI hydropower project being developed in Sikkim.

INR 3,000 crore project would be financed with a debt of INR 2,400 crore and equity of INR 600 crore. A consortium of nine banks and financial institutions, led by ICICI Bank, would take care of the debt component.

Lanco Infratech Ltd would have a 74% stake in the project with the Sikkim Government holding the remaining stake.

The power portfolio of Lanco group includes an operating capacity of 518MW and additional capacities under construction aggregating to more than 3,200MW, with an aggregate orders worth INR 7,500 crore.

Brief on MSTC Limited

Metal Scrap Trade Corporation Limited is a mini ratna category 1 public sector undertaking under the administrative control of the union ministry of steel. It was set up in 9th September 1964 to act as a regulating authority for export of ferrous scrap with an investment of INR 0.6 million. Union government, members of steel arc furnace association and members of ISSAI had made with the investment.

MSTC became a subsidiary of SAIL in 1974 and in 1982 it got de linked from SAIL and became an independent company under ministry of steel. It was a canalizing agency for import of ferrous scrap till 1992.

MSTC is the leading importer of scrap in India. After de canalization in February in 1992, the demand for imported scrap was considerably reduced in India therefore, it enlarged its import basket and it now undertakes import of other items such as petroleum products, coke, coal, DR pellets etc for sale in India. MSTC also undertakes disposal of ferrous scrap and other secondary arising generated in integrated steel plants and disposal of scrap and surplus stores from other public sector enterprises and government departments.

GVK Infratech becomes GVK Power’s wholly owned subsidiary

GVK Power & Infrastructure Ltd has announced that it has acquired 9,900 equity shares of INR 10 each for cash at par aggregating to INR 99,000 in GVK Infratech Private Limited on July 5th 2007. And now, GVK Infratech Private Limited has become its wholly owned subsidiary with effect from July 5th 2007.

GVK Infratech Private Limited is a company incorporated on December 4th 2006 and is engaged in the business of setting up SEZs amongst other infrastructure facilities.

UBS increases iron ore price forecast for next year to 25%

AAP reported that according to the latest research from investment bank UBS, iron ore prices are expected to rise by at least 25% next year as its demand outpaces global supply.

UBS said "Bulk commodity fundamentals appear to be tightening once again, as demand growth outpaces global supply and availability issues emerge in an environment of tight shipping markets. We have increased our forecast for the 2008 contract, and are now looking for a 25% increase rather than the 10% increase previously forecast."

UBS listed a dip in Chinese domestic iron ore production, tight supply and an increase in steel production as the key drivers for its upgrade. It said "Steel production has grown faster than previously expected and was up 3.8% on 2006 for the five months to May.”

The revised forecast follows upgrades by Citigroup and Goldman Sachs JBWere, which have forecast a 20% and 9% increase next year respectively.

South Africa hit by industrial unrest as workers go on indefinite strike

It is reported that South Africa was hit by further industrial unrest on Monday when over a quarter of million engineering workers embarked on an indefinite shutdown in a dispute over pay. 260 000 workers from more than 9 000 companies in the metals and engineering sectors in South Africa have gone on an indefinite strike from Monday after weekend talks failed between trade unions Solidarity and the National Union of Metalworkers of South Africa and employers in the metals and engineering bargaining council.

Mr Dirk Hermann deputy general secretary of Solidarity told Sapa that workers would go on a full blown strike all over the country He said "Its indefinite, until we get settlement. So we can not say how long it will take."

NUMSA warned that production would stop across the board following a collapse in negotiations last Friday that have been dragging on for three months. Mr Mziwakhe Hlangani spokesman of NUMSA told AFP "It's a total shutdown of work in all companies. All workers in the metal and engineering sector have joined in the strike and we will ensure that operations grind to a halt. Export and manufacturing will be severely affected".

Employers were offering pay increases between 7.3% and 7.8% and the trade unions were demanding a 10% hike down from their original 15% demand.

Chinese domestic steel price stable in most region

Nanfang Daily reported that 49 prevailing offer prices of major steel varieties have clawed back some of the previous losses in major markets like East and Central China these days.

In Shanghai, third grade rebar price has rebounded across the board on July 3rd 2007 with prices of wire rod and second grade rebars also inching upward. HR sheet/coil prices also tend towards stable. The traders have seen robust sales at low price level reflecting that market demand still lingers on a good level despite the seasonal slowdown. However, traders fear that oversupply would become more pronounced in the future in the traditional slack season while the steel producers are not intending to cut production but concerned about current price rise could be short lived.

Steel prices held steady in North China due in part to limited arrival of fresh supply. Second grade 16mm to 25mm rebar goes at CNY 3570 per tonnes in Beijing and CNY 3540 per tonnes in Tianjin. Market analysts believe that limited availability would help stabilize construction steel price in Beijing and Shanghai, and there is also possibility to see slight price rally in days to come. However, the market appears to be fairly weak in South China with offer prices continue to fall. Local traders are pessimistic about the market prospect as the inventory keeps piling up. Particularly thick HR sheet/coil price see a daily drop of CNY 30 per tonnes.

The Southern market has been hit by low priced materials however further price decline would be limited by steep input cost. Some traders are reluctant to cut prices since the EXW prices have already exceeded the market price.

In Lecong construction steel market keeps quiet with quite few deals being concluded. The wire rod price keeps sliding due to low priced materials from other provinces and far less purchase orders from downstream buyers and the demand has yet to show sign of picking up despite price decrease. Traders are faced with increasing pressure as a result of heavy stock and sluggish demand although the steelmakers have lowered the EXW prices.

Market analysts also bearish on future price movement due to demand slowdown and increased supply to the domestic market following the export tax change. The steelmakers insist that traders have to book the material in full quantity as contracted while the traders believe the prices would continue downward path in short term.

(Sourced from MySteel.net)

TMK H1 2007 pipe shipments cross 1 million mark

One of the world’s largest oil and gas pipe producers and the market leader of the Russian pipe industry OAO TMK announced production results for January to June 2007. TMK shipped 1.575 million tonnes of steel pipes from its plants for subsequent sale to customers in H1 of 2007 up by 8% YoY as compared to January to June 2006.

Volumes of shipped pipe products for H1 2007

In thousands of tonnes

TMK’s steel making facilities produced 1.144 million tonnes of steel in January to June 2007 up by 3.2% YoY.

CISA calls for joint iron ore transport agreements to control freight volatility

Interfax China reported that the China Iron and Steel Association has urged domestic steel mills to jointly sign long term iron ore transportation contracts with large shipping companies, in order to combat high level fluctuating freight costs.

Six major domestic steel mills and several large shipping companies attended a meeting held by the CISA in Beijing last Friday and discussed countermeasures to the recent high freight costs. The six steel mills, representing steel mills in five Chinese regions, included Shougang representing Hebei Province, Anben Steel and Baotou Steel representing northeastern China, Jinan Steel representing the provinces of Shandong and Shanxi, Baosteel representing eastern China and WISCO representing central and southern China. Shipping companies in attendance included COSCO, China Shipping and Sinotrans.

Mr Chen Xianwen deputy director general of the CISA said "Domestic steel mills and shipping companies exchanged opinions on the recent increase in iron ore freight costs and it was concluded that China's strong iron ore demand coupled with tight shipping capacity was the cause of high freight costs. Moreover, market speculation has also boosted freight costs to recent record highs.”

Mr Chen added that “China's iron ore demand will be significantly higher this year than last year. Moreover, tightness in shipping capacity will not be solved in the short term, the effect of which will be continued high freight costs for the rest of the year.”

Both Australian and Brazilian iron ore freight costs to Chinese ports have undergone severe fluctuations since the all time high in mid May this year. Iron ore freight cost from Brazil's Tubarao Port to Beilun/Baoshan ports fell almost 28% in the month since the May 16 peak, but subsequently rebounded 24% to approximately USD 50.59 per tonne by last Friday. Iron ore freight costs from Western Australia to Beilun/Baoshan ports fell plunged percent in the month since May 16, but also recovered 26% to recent USD 18.96 per ton levels, according to statistics provided by Mysteel.

Mr Mordashov eying Power Machine – Report

Reuters reported that Mr Alexei Mordashov majority owner & CEO of Severstal has requested permission from Russian anti monopoly agency to buy control of turbine maker Power Machines.

The report cites a representative of Russia's Federal Anti Monopoly Service said that the agency had received a request from Mr Mordashov to buy a stake in the country's largest turbine manufacturer, without revealing the size of the stake or the vehicle through which Mr Mordashov intended to buy it

Russian business newspapers Vedomosti and Kommersant, quoting unnamed industry sources said that Mr Mordashov wanted to buy 100% of Power Machines, pitching him into competition with other Russian billionaires, including Mr Oleg Deripaska and Mr Viktor Vekselberg, who have large stakes in the power sector.

Earlier Germany's Siemens, which holds 25% plus one share in Power Machines, had sought to buy control of the firm, but Russian authorities blocked the deal, citing national security reasons.

General Steel Holding’s Long Steel JV gets license

China's first US publicly traded steel company General Steel Holdings Inc has announced that it has received business license approval for its JV with Shaanxi Longmen Iron & Steel Group Co Ltd in China’s Shaanxi province.

The proposed JV assumes existing operating units of Long Steel. Long Steel is the largest steel producer in Shaanxi province and was ranked among the top 50 steel companies in China by the National Statistics Bureau in 2006. Key units within the JV include rolling mill, iron and steel making facilities. Initial production capacity will be 3 million tons annually and will focus on rebar and related products.

Mr Henry Yu CEO & chairman of General Steel said that "After further discussions with the government, we changed our strategy away from acquiring the company in favor of a 60% position in a JV. This allowed us to gain quicker licensing approval from the government."

Mr John Chen CFO of General Steel said that "The decision to pursue a JV structure also allowed us to be selective in the units included in the deal. We were able to eliminate less efficient assets and concentrate on core operations for rebar and related products. This places us in an even stronger position to take advantage of the growing infra structure and building development going on in China's western region."

General Steel Holdings Inc operates in China through subsidiaries in Shaanxi, Inner Mongolia and Tianjin. Its primary product lines include HR carbon and silicon steel sheets, rebar and seamed and seamless pipes and its total production capacity is 3.5 million tonnes.

Chinese iron ore import scenario pushing sea freights

Xinhua reported that China's iron ore import price and seaborne freight rates showed upward trend as a new round negotiation for iron ore import price in fiscal 2008 is coming, arousing high attention.

Chinese iron ore market price has rebounded up recently with rising transaction volume. Price for India origin iron ore fine with 63.5% Fe content rose by CNY 10 per tonnes in the last week of June 2007.

Besides, sea borne freight rate also kept climbing up during these days. In the last week of June 2007, seaborne freight rate for Brazil to China route went up by USD 9.34 that for West Australia to China route is up by USD 5.96.

It is known that rising coke price will directly affect costs for pig iron and billet. Under such circumstances, dealers are very confident of the import iron ore market. Some experts forecasted that iron ore would still be in tight supply and iron ore price would continue to climb up.

(Sourced from MySteel.net)

Platts maintains HR price assessment despite Erdemir indications

Platt's reported that in the latest tender of Turkish mill Erdemir, HR coil prices are just USD 5 per tonnes lower at USD 625 per tonnes FOB Black Sea and cold rolled price stayed at USD 700 per tonnes to USD 705 per tonnes FOB Black Sea.

The report added that these prices are in sharp contrast to the Platts assessment for HRC at USD 550 per tonnes to USD 560 per tonnes FOB Black Sea, but part of the reason may be because the mill is fully booked for domestic orders.

A Turkish market source told Platts that strong demand for HRC continues from the Turkish domestic market which may be propping up the latest prices from Erdemir that has only a small capacity for export where material is mainly for domestic market being sold to Italy and Spain priced at around USD 575 per tonnes to USD 580 per tonnes if converted to a FOB Black Sea basis. The source added that even that price level is still USD 25 per tonnes to USD 30 per tonnes higher than the Platts assessment but the same source attributed the disparity to the likelihood that the quality is different from Turkey compared to the Ukraine and Russian.

The source said a Russian based source was more direct however, dismissing these higher prices. "It's a producer they're trying to avoid pressure on the prices and could see full warehouses and noted that FOB Black Sea prices were still very much in line with the Platts assessment.

The Platts assessment for HRC was therefore unchanged at midpoint USD 555 per tonnes FOB Black Sea.

Sweden export of iron & steel to UAE in 2006 up by 234% YoY

Khaleej Times reported that the Swedish Trade Council expects a further increase in Swedish exports of iron and steel to the UAE that grew by 234% YoY to AED 181.52 million (SEK 332.74 million) in 2006 from AED 54.32 million (SEK 99.76 million) in 2005.

The report cited Mr Antoine Fanoun project manager for the Middle East and Eastern Africa of Swedish Trade Council, a semi government body that helps companies in Sweden to expand abroad, as saying that "As we have noticed an increased interest in the UAE from Swedish companies within this industry, we do expect the exports to continue to be positive during 2007."

He also added that Swedish Trade Council expects the UAE to take over Saudi Arabia to become Sweden's largest trading partner among the GCC countries in the coming years. However, Swedish Trade Council expects a slight decrease in total exports from Sweden to the UAE for 2007 due to a slump of re exports to Iran.

Mr Fanoun said that the Swedish Trade Council, which started an active operation in Dubai in July 2006, would arrange a regional exporters' conference in November to showcase Swedish companies before delegations of businessmen and government officials from countries in the Middle East. He added that Swedish Trade Council used to be represented by the Swedish Business Council in the UAE, an organization of Swedish businesses having 140 members, both companies and individuals.

Power shortage in Argentina to hit steel makers marginally – Analysts

BNamericas reported that losses at Argentine steelmakers due to lack of gas and electricity supply are marginal for now. The report cited Mr Cristián Reos analyst with brokerage Allaria Ledesma as saying that "While the gas and energy reductions at the companies might have a negative effect on annual production that effect as yet would not be very relevant."

He added that if the cuts continue the companies could be jeopardized but that will depend on increased rain and cold or the possibility of importing energy from neighboring countries. He explained that the impact so far has been small as the companies have made an effort to adapt to the cuts working in shifts and looking for ways to reduce consumption.

Mr Reos believes that the option to cut residential services is not likely, since it's an election year and the administration won't consider that option because it doesn't want to lose votes. It would prefer losing some economic growth points over losing votes.

Mr Adimra an official at Argentina's metallurgical association said that the problem lies in the political management of a technical problem. He explained that "What we need to do is save energy in order to not cut it to homes."

The Argentina government made the decision to cut the gas supply to local industry in May 2007 after residential demand increased as a result of the onset of cold winter temperatures.

Scandinavian Minerals applies environmental permit for Kevitsa

Canadian listed junior Scandinavian Minerals Limited announced that it has applied for the environmental permit for its 100% owned Kevitsa nickel copper PGE property in Finland. Earlier in December 2006 it had applied for the mining permit for the Kevitsa property and the environmental permits comprise the two permits required under Finnish law for the construction of a mine. Both permits are expected to take approximately one year to be granted.

The permit applications are based on an open pit mining operation, mining approximately 4.5 million tonnes of ore per year, with production of nickel and copper concentrates containing GBP 19 million of nickel and GBP 31 million of copper per year. Both permit applications make provision for a possible higher level of production, subject to the conclusions of the ongoing feasibility study.

Mr Peter Walker president and CEO of Scandinavian Minerals commented that "The filing of the environmental permit application completes the permit application process for the Kevitsa property. It follows the previously announced engagement of Outotec Oy to carry out the detailed mine and process engineering for the Kevitsa project.

In April 2007 Scandinavian Minerals commenced the feasibility study for the Kevitsa property, which is expected to take about 12 months to complete.

Chinese export tax to impact large mills nominally

Mr Tang Fuping GM of Angang on the 2007 Forum of top 100 listed companies said that changes of export rebates are mainly aimed at curbing heavily polluting and high energy consuming products thus have less impact in large steelmakers like Angang or Wuhan.

Mr Fu admitted that the policy changes, especially export rebate evolvement, will lend some impact on some mills in export business but for the large enterprises, which often export first rate and high end products that are competitive on international market, the effect will be small.

While speaking of the tendency of steel prices, Mr Fu said that steel prices have been walking up the ladder these years thanks to rapid development of infrastructure construction in China; yet alike other products, the price would not always stay on the upward track, periodical changes will be seen.

Last September 2006, China cut export rebates for some products from 11% to 8%; this April 2007, the rebates were further reduced to 5% for a number of codes with 83 other codes deprived of refund entirely from July 1st 2007 export rebates for some steel articles were also lowered. This is sending a clear signal the nation is to restructure the steel industry, urging participants to curtail output of high value added and high energy consuming products, to be replaced by high end ones.

(Sourced from MySteel.net)

BlueScope expresses concerns over new IR policy

It is reported that Australia’s BlueScope Steel has expressed concerns about the Labor Party's new industrial relations policy.

Mr Graham Kraehe chairman of BlueScope Steel said that the current system has seen a dramatic fall in the number of hours the company has lost to industrial action. He added that if this policy is implemented there is a risk of turning back the clock to industrial disquiet. Mr Kraech said that "Automatic access of unions onto sites that is a very, very dangerous thing. Also automatic referral to centralized decision makers if there's an inability to come to conclusions at the enterprise level."

But Ms Julia Gillard a labor leader dismissed concerns raised about Labor's industrial relations policy. She said that "We will make sure that under fair and balanced laws that we do not see any return to increased industrial disputation, but unlike Mr Howard, we will be fair to Australian working families. We would not allow people to go into workplaces and have their pay and conditions ripped off the way they can be now." She further added that there will be no automatic access to arbitration as claimed and there will be the ability for unions to enter onto workplaces, as they can now, but with proper permits and notifications.

ANZ financing CVRD pallet venture in China

Reuter reported that Australia and New Zealand Banking Group Limited is arranging a project finance facility for an iron ore pellet project in China, involving a JV of Brazil’s Companhia Vale do Rio Doce.

Australia and New Zealand Banking Group in a statement said that Zhuhai YMP Yueyufeng Iron & Steel Corporation Limited would build an iron ore pellet plant in China's southern province of Guangdong.

Zhuhai YPM Pellet is a JV set up by Zhuhai Yueyufeng Iron & Steel Company Limited, Pioneer Iron & Steel Group and CVRD in 2006.

Union ratifies contract for AK Steel Rockport plant

AK Steel has announced that members of the United Auto Workers Local 3044 have ratified a new 6 year labor agreement covering about 190 hourly production employees at the company’s Rockport Works. AK Steel said that UAW officials have notified it that the new contract was ratified in voting held on July 5th and 6th 2007 in Rockport. The new agreement takes effect August 1st 2007 and runs through September 30th 2013.

The parties had agreed to commence early bargaining in the mutual desire to reach a new contract prior to the expiration of the existing agreement that would have expired on September 30th 2007 and a tentative contract agreement was reached on June 28th 2007.

AK Steel said that among various provisions the new contract at Rockport Works includes
1. Competitive wage increases and lump sum payments
2. A signing bonus for early ratification
3. Continued cost sharing for employee health care
4. Improved contributions to a 401(k) defined contribution retirement plan

Mr L Wainscott chairman, president & CEO of AK Steel said that “We are delighted that members of UAW Local 3044 have ratified a new, competitive labor agreement that will help Rockport Works continue to serve our valued customers with outstanding quality and productivity. We are especially pleased that the new contract is in place well ahead of the expiration date of the previous agreement.”

AK Steel produces flat rolled carbon, stainless and electrical steel products, as well as carbon and stainless tubular steel products, for automotive, appliance, construction and manufacturing markets. Rockport Works process flat rolled carbon and stainless products for a wide variety of end uses, including automotive and appliance markets.

Green Steel selects Mittal Steel USA as supplier of the year

It is reported that Ohio based Greer Steel has named ArcelorMittal’s Mittal Steel USA as its 2006 supplier of the year. Greer selected Mittal Steel's facilities at Riverdale in Illinois and Cleveland for providing high quality materials and services in 2006.

The supplier of the year decision is made by a cross functional team of Greer personnel representing purchasing, quality assurance and manufacturing that evaluates candidates based on performance in areas such as quality, responsiveness, technology, and value.

Mr Ramstrom to take over as new head for SSAB’s plate division

SSAB announced that Mr Karl Gustav Ramström currently head of division within Process Automation at ABB Sweden has been appointed as the new Head of SSAB Svenskt Stal’s Plate Division in Oxelösund. Mr Ramström will be introduced to the Division in the fall 2007 and will take up his new role at the latest on January 1st 2008. The acting Head of the Plate Division at SSAB, Mr Ola Hägglund will continue in that capacity until Mr Ramström takes up his position thereafter he will work as a senior adviser and report directly to the CEO.

Mr Ramström studied engineering at Uppsala University and majored in technical physics. In addition to his engineering degree he holds an MBA in international marketing, also from Uppsala University. Since 1979, Ramström has held senior positions within ASEA/ABB.

Mr Olof Faxander president & CEO of SSAB said that “I am very pleased that Mr Karl Gustav Ramström has agreed to become the new Head of the Plate Division.” He added that “Mr Ramström will join at a very interesting stage for our plate business. We are carrying out extensive investments in Oxelösund with the aim of further strengthening our position as global leader within the quenched steels niche.”

Mr Faxander added that “I wish to thank Ola Hägglund for the very fine work during the past year in which he has been acting Head of the Plate Division and I look forward to continuing to work together with him in his new position.”

BlueScope to announcement new CEO soon

Dow Jones reported that Australia's BlueScope Steel Limited senior management has interviewed several internal and external candidates and is close to announcing who will replace its retiring CEO. BlueScope has had earlier said that it plans to announce replacement in August 2007.

Mr Graham Kraehe chairman of BlueScope told Dow Jones Newswires that "Our objective is to be able to make an announcement in three weeks time and we are on track to do that. We have tested the water externally as well as going through a very rigorous process with some high quality internal candidates."

The list of people speculated to take over as CEO includes Mr Chris Lynch of BHP Billiton, Mr Andrew Michelmore of WMC Resources Limited, Mr Galdino Claro of Alcoa Inc, Peter Johnston of Minara Resources Limited, Mr Lance Hockridge of BlueScope Steel, Mr Brian Kruge Australian manufacturing head of BlueScope Steel and Mr Paul O'Malley CFO of BlueScope Steel.

Mr Kirby Adams CEO of BlueScope Steel is due to step down in October 2007.

Rio to increase iron ore R&D investments in Australia

It is reported that Rio Tinto is to expand its technical innovation activities by committing AUD 21 million over five years to a new Research & Development center for mining automation at the University of Sydney. In addition, Rio is also basing both its newly appointed group scientist and Global head of Innovation in Australia.

As per report the Australia center will support up to 30 full time staff and ten research students with funding of AUD 5 million a year when fully staffed. The initial agreement for five years has the potential for extension by agreement between The University of Sydney and Rio Tinto following mutually satisfactory technology and innovation outcomes. A technical management group with representatives from Rio Tinto and the ACFR will monitor the Center’s performance and guide its direction.

Mr Tom Albanese CEO of Rio Tinto's while announcing the increased funding for technical innovation said Rio Tinto was increasing its innovation effort to position it to develop ore bodies around the world. He said "Australia is a natural base from which to support our operations with the innovative technical solutions they will need in the future. A common feature of Rio Tinto's technical and innovation activities is their strong linkages with Australian academic and research institutions. This focus is a vote of confidence in Australia's innovation capability."

Baosteel X120 grade clears CNPC tests

Longitudinal welded steel pipe made from Baosteel's X120 pipeline steel has passed tests initiated by Tubular Goods Research Center of China National Petroleum Corporation. Both its chemical composition and mechanical property come up to the standard.

The strength of X120, the pipeline steel with the highest strength level currently in the world, almost doubles that of X80 and can save some 10% of total investments.

Baosteel began to develop X120 in 2005 and yielded X120 pipeline steel heavy plate in 2006 the first in China and the fourth in the world. BaoSteel also completed X120 pipeline steel weld test laying a good foundation for industrial application.

New Zealand coal miner suspended industrial action

It is reported that more than 800 coal miners involved in a New Zealand nationwide pay dispute with Solid Energy and its contractors have voted to suspend industrial action as a gesture of good faith ahead of mediation with Solid Energy.

The miners, all members of the Engineering, Printing and Manufacturing Union will suspend their nationwide overtime ban and campaign of spontaneous rolling stoppages pending the outcome of mediation.

Miners at Spring Creek and Terrace will also suspend their indefinite strike action, which has now been running for nine days.

Egypt to approve steel projects to reach 8 million tonne capacity

It is reported that Egypt is expected to approve about 10 proposals for new cement plants thus increasing Cairo’s production capacity by about 15 million tonnes a year and several projects to increase steel capacity by about 8 million tonnes per year.

As per report, Egypt’s industry ministry has received 51 applications for new cement facilities representing about 97 million tonnes per year of potential additional capacity and proposals for steel plants that will increase production by 30 million tonnes per year.

Salzgitter and Vallourec close precision tubes transaction

Salzgitter AG and Vallourec SA of Paris have signed the final agreements on the takeover of Vallourec Précision Etirage of France. All preconditions having been fulfilled especially the approval by the EU antitrust authority. The transfer of the shares of the business has taken place on July 2nd 2007 and now the company will be included in the financial statements of Salzgitter AG.

The precision tubes business of VPE with 5 plants in France, ideally supplements the current activities of the Salzgitter Group in this tubes segment which consist of the four plants of MHP Mannesmann Präzisrohr in Germany and one of Mannesmann Robur in the Netherlands. To secure the extensive independence of VPE, MHP and ROB in respect of the supply of seamless tubes as a primary material, part of the transaction also includes the takeover of a mill for hot rolled tubes for further processing in Zeithain.

The combination of the companies will be named Salzgitter Mannesmann Precision GmbH and form the European market leader for seamless and welded precision tubes with annual sales of around EUR 500 million and a workforce of 2,700 employees. The most important customers include the automotive industry and its suppliers, the mechanical engineering and the energy producing sectors. The precision tube is a growth product for industrial applications where great forces and high pressures, temperatures or rotational speeds are to be absorbed while construction remains light weight. The new group of companies enjoys an outstanding market position, especially in Germany and France, and is set to significantly strengthen its future potential by leveraging existing industrial and product related synergies.

CSIRO & Rio Tinto to operate Fe HyLogger technology

It is reported that CSIRO and Rio Tinto have begun to jointly operate CSIRO's Fe HyLogger technology in the Hamersley Ranges located within the Pilbara region of Western Australia.

The Fe HyLogger provides an extremely rapid and automated spectroscopic determination of the mineralogy of drill cores and chips, with the added benefit of objective core logging and grade estimations. It now provides Rio Tinto with far more information from cores and chips then ever before.

Mr John Phillips Rio projects manager of Rio Tinto's said that the HyLogger technology would provide a valid scientific foundation for the information derived get from cores or chips. He said “In the past we relied on visual estimation which is prone to error but this new approach gives us a much better baseline to build our understanding and reduces risk around starting up new operations.”

Mr John added that Dr Erick Ramanaidou commodity leader for iron ore research for CSIRO's is now spending a lot of his time in the Pilbara with the Fe HyLogger and he believes the technology will be a vital part of the exploration and mining scene in the future.

Dr Ramanaidou said "The iron ore industry is facing a shortage of skilled workers, combined with a large amount of iron ore samples to analyze. He said it is in urgent need of an automated tool to provide accurate results. HyLogger appears to be that tool and both CSIRO and Rio Tinto are delighted with the initial results."

The instrument is mounted in a custom built in an air conditioned container. The portable package of instrument, software and container was designed and built entirely in Australia by a team led by Dr Lew Whitbourn and Dr Jon Huntington at CSIRO Exploration & Mining's North Ryde Laboratories.

Dubai Central Lab gets ISO in construction materials testing

Dubai Central Laboratory announced that it has received ISO 17025 certificate in construction materials testing from Dubai Accreditation Center. The ISO certification is given to 14 tests in the field of construction materials testing.

Mr Abdullah Al Shaibani assistant director general of Dubai Municipality for Technical Services Affairs said that the ISO certification is yet another great achievement of the Dubai Central Laboratory, which has always been keen to be, pioneers in the region and the world.

He said that the certification process which lasted for a long period included intense procedures by experts who evaluated the quality system followed by the laboratory, verified the testing process and checked the competency of the testing equipments as well as the skills of the technicians in the lab.

Steel Pipe & Tube Consultants is now SPT Energy Group

It is reported that Steel Pipe & Tube Consultants has changed its name to SPT Energy Group.

Mr Robert Aguilar executive managing partner of SPT Energy said that "This change in corporate identity is a progressive reflection of our continuing efforts to increase the value offered to our clients by providing better people, better technology and ultimately better information."

With offices in Abbeville in Louisiana and Houston in Texas, SPT Energy Group provides certified 3rd party inspection personnel, pipe end measuring services and material tracking services to the pipeline industry.

Byelorussian Steel Works starts new seamless tube mill

It is reported that Byelorussian Steel Works has started produced seamless tubes after hollow bloom of about 6 meter, diameter 148mm and wall thickness 18.7mm were manufactured last month.

Mr Victor Matochkin chief engineer of the Byelorussian Steel Works told journalist that pipe piercing is the first stage in fabrication of this type of product and piercing of the first hollow bloom was carried out successfully.

Mr Matochkin informed that the next stage of pipe production is PQF mill used to produce the required wall thickness. Then the hollow bloom goes to the stretch reducing mill where final geometrical parameters of a pipe are formed. After that the pipe is cooled.

He added that the whole seamless pipe production cycle is commissioned now. USD 270 million was invested in realization of this project and the capacity of the pipe mill is 252,000 tonnes per year.

Niksic Ironworks reports losses for 2006

Serbia and Montenegro Today reported that Montenegro based Niksic ironworks had operated with losses totaling EUR 12.5 million in 2006. Niksic has recorded EUR 68.3 million in revenues from 162,000 tonnes of manufactured steel in 2006 up by 55.5% YoY as compared to 2005 while utilization of capacities in steel production stood at 72% on average.

Niksic's financial report prepared by its new owner London based Montenegro Specialty Steels said that Niksic has sold 143,700 tonnes of steel in 2006 up by 6.4% more than planned and up by 328% YoY as compared to 2005.