TATA Metaliks, Kubota and Metal One ink ductile iron pipe JV

TATA Steel’s TATA Metaliks Limited announced a JV agreement with Japanese companies Kubota Corp and Metal One for setting up facilities to manufacture ductile iron pipes in India. Mr H Fujikawa COO of steel energy division of Metal One, Mr Daisuke Hatakake president of Kubota Corporation and Dr T Mukherjee, chairman of TATA Metaliks and Mr Harsh K Jha MD of TATA Metaliks were present while signing the JV agreement.

The JV would be called TATA Metaliks Kubota Pipes Limited. TATA Metaliks would own a 51% in the company, 44% is held by Kubota and 5% is owned by Metal One,

The plant would be located in Kharagpur in West Bengal and will begin production in early 2009. The plant will have an initial capacity of 0.11 million tonnes of ductile iron pipes and the may increase its production to 0.2 million tonnes soon. The total project cost is INR 1.50 billion.

Dr T Mukherjee said that there is immense opportunity since the demand for ductile iron pipe is growing at a healthy rate. Ductile iron pipes are used to distribute drinking water in cities. There is a rise in the demand for DI pipes with growing urbanization and strengthening of infrastructure. At present, DI pipe demand is growing by 18% annually.

Mr Daisuke Hatakake president of Kubota Corporation said “The success of this venture will determine our future in India and shape our strategy.’ Kubota is the world leader in DI pipe manufacturing. It also exports a sizeable chunk of its produce. Metal One exports some of Kubota’s products.

Public sector SPV for overseas coal assets to be approved soon

BL reported that a special purpose vehicle promoted by 5 public sector undertakings namely, Steel Authority of India Ltd, Rashtriya Ispat Nigam Ltd, National Mineral Development Corporation, National Thermal Power Corporation Ltd and Coal India Ltd, to scout and acquire coal properties abroad is likely to take shape soon with the union steel ministry planning to put the proposal before the cabinet by the end of July 2007.

The report cites a steel ministry official as saying that “Currently, we are in the process of consultations with various departments on the matter and it is expected to be over in the next couple of weeks. By the end of July 2007 we expect it to be placed before the cabinet. The special purpose vehicle does not call for budgetary support and the understanding among all the companies is that a portion of their profits would be made available for the special purpose vehicle, the steel ministry does not see a problem for getting the necessary cabinet clearance.”

The shareholding pattern of the new company would be in proportion to the coal requirement of the individual company. The official added that “The special purpose vehicle would have an authorized capital of INR 10,000 crore and a paid up equity of INR 3,500 crore. While SAIL and CIL would have to chip in with INR 1,000 crore each, the other 3 companies would have to contribute INR 500 crore. Currently, SAIL imports around 70% of its coal requirement while RINL imports around 90%. And both these companies are going in for major expansions and their import requirements will go up so, this special purpose vehicle will help them overcome the shortfall as, according to estimates, the SPV is looking at 500 million tonnes of recoverable reserves and also thermal coal.”

The proposed special purpose vehicle can acquire a stake in a company abroad or look at taking the prospecting root for getting the coalmines abroad.

Mineral Enterprises plans to double iron ore output

BS reported that Karnataka based mining company Mineral Enterprises Ltd is now planning to double its iron ore production to 3 million tonnes in 2007-08 and has tied up with a Goan firm for this purpose.

Mr Basant Poddar MD of Mineral Enterprises said that “We plan to enhance production to 3 million tonnes by the end of the present fiscal. Capital expenditure towards the enhancement of iron ore production will be minimum. The Goan mining firm will deploy its machinery to enhance production. They have already commenced mining operations.”

The INR 400 crore Mineral Enterprises has iron ore mining operations in Chitradurga and Tumkur districts of Karnataka. Mineral Enterprises’ production capacity is around 1.5 million tonnes currently. It produces medium grade iron ore containing less than 62% ferrous content per tonne. While 80% of the production is exported, the remaining stock is traded in the domestic market.

Inadequate transport infrastructure in Karnataka to supply iron ore from Chitradurga and Tumkur districts to the ports on the west coast had become a constraint for expansion. But with the Hassan to Mangalore broad gauge railway line being almost operational, Mineral Enterprises expects to overcome this bottleneck.

TATA Steel announces scholarship for children of displaced families

TATA Steel announced scholarships for those children of the families displaced by its proposed steel plant in Orissa's Kalinga Nagar who have already taken admission in recognized colleges and institutes.

The program, named TATA Steel Parivar Scholarship, will cover the cost of education and accommodation of students offering diploma, graduate or post graduate degrees. The money will be paid to the institution directly where the student has taken admission.

It is part of the company's commitment to ensure better quality of life and sustainable livelihood for the members of TATA Steel family. Its primary objective is to provide technical and professional qualifications to the children of rehabilitated families, the release said.

5 Indian companies may bid for TLT project in Nepal

It is reported that 5 major Indian companies namely Jyoti Structures Ltd, Kalpataru Power Transmission Ltd, KEC International Ltd, Larsen and Toubro and TATA Projects are bidding to build the transmission line for Nepal's 750MW West Seti hydropower project in remote Doti district that will connect far western Nepal with the Bareilly grid in India. Closing date for the bid is July 31st 2007.

The USD 1200 million project has already seen its developer West Seti Hydro Limited sign a power purchase agreement with Power Trading Corporation in October 2003. While the government of Nepal has given West Seti Hydro Ltd a 30 year generating and transmission license, the power purchase agreement with Power Trading Corporation is valid for 25 years.

Though the giant project was signed in the 1990s, it failed to get off the ground earlier due to the Maoist insurgency and political instability, which combined to keep investors away. While the government of Nepal has a 15% share, the other partners are West Seti Holdings registered in Hong Kong with 26%, Asian Development Bank with 15%, China National Machinery Import Export Corporation with 15% and Special Purpose Vehicle, a consortium of Nepali financial institutions with 14%. Three main Chinese banks are providing 75% debt while the capital structure following ADB norms is of 25% equity. The banks are China EXIM Bank, Industrial and Commercial Bank, and Bank of China. The project is expected to be complete by 2013.

Indian Railways freight earnings in Q1 up by 9.4% YoY

Indian Railways have generated INR 10896.61 crore of revenue earnings from freight traffic during April to June 2007 up by 9.41% YoY as compared to INR 9959.49 crore during April to June 2006. Indian Railways carried 185.25 million tonnes of freight traffic during April-June 2007 as compared to 175.84 million tonnes carried during April to June 2006.

The earnings from freight traffic during the month of June 2007 was INR 3539.97 crore up by 8.34% YoY as compared to INR 3267.37 crore June 2006. Indian Railways carried 60.46 million tonnes of freight traffic during the month of June 2007 as compared to 58.17 million tonnes of freight traffic during June 2006.

The details of traffic handled during June 2007 is as under

Volume in million tonnes
Value in INR crores

Siscol posts 86% YoY growth in Q1 sales

JSW Steel’s Southern Iron and Steel Company Limited in Salem district of Tamil Nadu announced that its net sales in April to June 2007 increased by 86% YoY to INR 237.26 crore and EBIDTA shot up to INR 47.65 crore up by 105% YoY. Its operating profit margin stood at 20% while profit before tax was INR 15.07 crore.

The release added that steel production was up by 34% YoY while sales realization grew by 86% YoY. In terms of operational performance, production of billets stood at 95,174 tonnes up by 43% YoY as compared to 66,516 tonnes in April to June 2006 and the production of rolled products stood at 78,481 tonnes up by 34% as compare to 58,449 tonnes in April to June 2006.

Siscol’s plan to increase production capacity from 0.3 million tonnes per annum to 1 million tonnes per annum is under way and in view of its phased commissioning, the company expects steel production to double to 0.6 million tonnes during the current fiscal.

Siscol was ailing before it being taken over by JSW Steel from the Coimbatore based LMW Group.

Hindustan Infrastructure to develop port at Vijaydurg

It is reported that Hindustan Infrastructure Projects & Engineering Private Limited has earmarked about INR 1,500 crore for developing an all weather port at Vijaydurg. The port, when complete, may attract cargo from industries located in Satara, Sangli, Solapur, Pune and Ahmednagar. Since it is a non major port, Hindustan Infrastructure can fix tariffs for services provided at the port.

As per report, the Maharashtra Maritime Board has already issued the company a letter of intent to this effect under which Hindustan Infrastructure Projects & Engineering Private Limited would be allowed to operate the port for 50 years and a MoU between the state government and the company will be signed after Hindustan Infrastructure accepts the terms spelt out in the letter of intent.

Hindustan Infrastructure Projects & Engineering Private Limited is a company floated by Mr Rajeev Chandrasekhar and is making an aggressive foray into the logistics and infrastructure sector in India. It is a partner, along with Neptune Orient Lines, in the containerized rail freight company APL IndiaLinx. It also reportedly intends to bid for the INR 4,360 crore deep water container terminal at Vizhinjam in Kerala, the fourth container terminal at Jawaharlal Nehru Port and the Tadri port in Karnataka.

Cochin Shipyard posts record production for 2006-07

Cochin Shipyard Limited has achieved an all time high of 181,000 DWT in shipbuilding in 2006-07 as compared to 110,206 DWT achieved in 2005-06. CSL is expecting a net profit of around INR 58 crore in 2006-07 as compared to INR 18 crore in 2005-06 on a turnover of INR 800 crore as compared to INR 418 crore in 2005-06.

Cochin Shipyard has recently delivered a platform supply vessel Sea Angler to Deep Sea Supply, Norway on Thursday. This is the third vessel being delivered in this calendar year of a series of eight ships being built for this owner. The yard also laid keel for BY-60 the fifth of the series of PSV.

The yard is constructing 17 platform supply vessels for European clients. Apart from this, 2 bulk carriers for Clipper, Bahamas, are under advanced construction. Total order book of CSL is 19 ships amounting to over INR 2,000 crore. This is excluding the Air Defence Ship for the Indian Navy.

ArcelorMittal to buy VPS and VCAV from Vallourec

ArcelorMittal announced that it has reached a preliminary agreement to acquire two steel tube businesses from Vallourec. The agreement forms part of ArcelorMittal's strategy to expand its business in the automotive sector, as well as further strengthening the company's pipes and tubes business. The project will be presented to the relevant employee representative bodies for consultation. Completion of the transaction is conditional upon a clearance decision by the competent competition authorities.

Vallourec Précision Soudage produces about 100,000 tonnes of welded steel tubes for manufacture of suspension and body in white components, cars seats and cold drawn products. VPS annual sale is around EUR 100 million. ArcelorMittal is one of the main suppliers of coils to VPS. VPS employs 320 people in its factories in Hautmont and Chevillon both in France. VPS is the supplier of welded tubes to VCAV.

Also based in France, Vallourec Composants Automobiles Vitry specializes in the design and manufacturing of tubular components for the automotive industry. Involved at the very early stages of design and production of tubular components, in partnership with the automakers engineering office, VCAV is specialized in chassis functions and passive safety solutions like suspension and crash components. Annual sales are around EUR 45 million. VCAV employs 230 people in its factory at Vitry- Le-François, France.

Combining them with ArcelorMittal's existing pipes and tubes business, will allow offering an even more complete range of products to its automotive customers.

Mr Malay Mukherjee a member of ArcelorMittal's Group Management Board said "The planned acquisition of these businesses is complementary to the leading position of ArcelorMittal in the automotive business. It will enable us to strengthen our automotive products portfolio, especially in precision tubes and tubular automotive components by adding these new European facilities to our existing North American and European assets. The acquisition will also broaden our tubes related R&D capabilities. VPS and VCAV will also benefit from being part of the largest steel company, through significant commercial synergies and sharing of knowledge from across the group. "

Mitsubishi and Murchison sign agreement for iron ore business

Murchison Metals Limited has announced signing of an agreement with Mitsubishi Development Pty Ltd to develop major iron ore and infrastructure businesses in the Mid West region of Western Australia. The Agreement envisages a total investment of approximately AUD 3 billion to be funded utilizing equity capital to be contributed by Mitsubishi and a debt funding package, the arrangement of which will be managed by Mitsubishi leveraging its global financial resources and world-renowned development capabilities.

Under the Agreement, Mitsubishi has agreed to acquire 50% of Murchison’s iron ore business including Murchison’s flagship Jack Hills Project, a potentially world class operation planned to expand production to 25 million tonnes per annum of high grade direct shipping iron ore. Highlight of the agreement includes
1. Mitsubishi to acquire 50% of Murchison’s iron ore assets
2. Murchison and Mitsubishi to jointly pursue other iron ore development opportunities in the Mid West region of Western Australia
3. Murchison and Mitsubishi to establish 50:50 infrastructure business to develop new Mid West rail and port infrastructure
4. Mitsubishi purchase price expected to provide required equity capital to develop Jack Hills mine and associated rail and port infrastructure
5. Mitsubishi to manage the arranging of debt funding and provide additional financial support for Jack Hills and for Murchison’s commitments to new infrastructure business on approval to proceed with the expansion of Jack Hills
6. Potential total investment of approximately AUD 3 billion

Mr Paul Kopejtka executive chairman of Murchison said that the signing of the Agreement with Mitsubishi represented a landmark event for Murchison, the entire Mid West region and for Western Australia. The creation of this formidable business relationship with Mitsubishi should ensure that Murchison realizes its ambition to become a world class iron ore and infrastructure company. Utilizing Mitsubishi’s strong balance sheet and access to best-in-class expertise crucial to developing mine and infrastructure businesses, this agreement not only facilitates the accelerated and successful development of the expanded Jack Hills Project, but also best positions Murchison to take a significant equity position in a new Mid West infrastructure business. With Mitsubishi’s wealth of experience in mine and infrastructure businesses and this commitment to effectively underwrite mine and infrastructure development costs that are likely to approach AUD 3 billion, the infrastructure business established by Murchison and Mitsubishi will allow the rapid advancement of the Mid West region. We are delighted to have secured Mitsubishi as our business partner and look forward to a long and successful business relationship.”

Mitsubishi has enjoyed a successful track record over many years in Western Australia. It was one of the early investors in the Pilbara and is presently a partner with Rio Tinto in the HIsmelt iron ore downstream processing plant in Kwinana. It also holds an important interest in the North West Shelf oil and gas venture.

With a current market capitalization of approximately AUD 1.3 billion, Murchison is the largest of the emerging iron ore producers in the Mid West region. Together with Mitsubishi the iron ore and infrastructure businesses will have the financial and operational capability to undertake new regional development.

CVRD buys 51% stake in Belvedere coal JV

Companhia Vale do Rio Doce announced that it has exercised a call option to acquire a 51% interest in the Belvedere coal joint venture for USD 90 million. Subject to the fulfillment of certain conditions, CVRD will pay USD 45 million each to subsidiaries of Aquila Resources Ltd and AMCI International AG.

Under the terms of the joint venture agreement executed with Aquila and AMCI, CVRD has a further option to raise its stake in the project up to 100% by acquiring the remaining 49% interest at a fair market value to be determined at the time of the exercising of the option.

Belvedere is an underground coal project in the southern Bowen Basin region of the state of Queensland of Australia.

CVRD conducted an exploration study to assess the geological structure, coal resources, product quality and underground mining conditions as well as the potential mining, processing and logistical requirements for the establishment of a multi long wall mining operation to produce hard coking and PCI coal. The JV shall now undertake a feasibility study with respect to the development of Belvedere.

CVRD said “Investment in the coal business is an important part of our strategy and this acquisition is another step towards the building of a strong growth platform.”

CVRD holds minority stakes in Chinese coal companies and is on the way to start the development of Moatize, a large coal project in Mozambique. After acquiring AMCI's Australian assets in the first half of this year, CVRD has coal operations in Australia with capacity to produce 8 million tonnes per year, which may be further expanded in the future with the development of the Belvedere project.

BHP no longer considering Alcoa bid – Report

The Australian newspaper citing unnamed sources reported that BHP Billiton is no longer considering making an offer for Alcoa, pushing Alcoa shares down by more than 7%.

Sources had previously told Reuters and it was widely reported that BHP had been considering the idea of making offers for Alcoa and Alcan Inc, the Canadian company that just fought off a hostile bid from Alcoa by agreeing to a friendly deal with Rio Tinto.

A spokesman for Alcoa declined to comment on the newspaper report, and BHP was not immediately available to comment.

Analysts have said Alcoa's failed bid for Alcan was likely to make Alcoa a target, with companies such as Xstrata PLC Brazil's CVRD as potential suitors.

Construction boom to fuel rebar demand in Middle East

The steel industry in the Middle East is heading for major expansion as crude steel production is projected to increase by nearly 70% from 15.4 million tonnes in 2006 to over 26 million tonnes by 2010.

According to a released recently report “The Steel Industry Worldwide and Regionally: Assessment of Development and Outlook,” by the Kuwait based Gulf Investment Corporation, steel demand in the region is dominated by long products, most of which are used in construction. Long product output such as rebar will be the dominant form of steel production, although its share of output will be declining. Rebar output grew from 14.1 million tonnes in 1997 to 21.6 million tonnes in 2004 and is expected to reach 28.9 million tonnes in 2010.

Although the Middle East has been one of the world’s active regions for steel plant suppliers in recent years, its steel plants are mostly starting from lower steel making base especially in flat products. The report said total flat products production has increased from 9.9 million tonnes in 1997 to 18 million tonnes in 2004 driven mainly by Turkey and Iran and to a lesser extent Saudi Arabia and Egypt.

In the Middle East, most current investments are driven by growth in domestic demand emanating from strong construction boom. Steel demand in the region is expected to increase from 70 million tonnes in 2007 to around 90 million tonnes in 2010. GCC steel demand will be in the range of 20 to 30 million tonnes during the same period.

According to a report in the Metal Bulletin Research in its December 2006 issue said that steel capacity expansion would be dominated by Egypt, Saudi Arabia and UAE. Egypt will have added capacity expansion of nearly 2 million tonnes, Saudi Arabia 5 million tonnes and UAE 1.5 million tonnes by 2010. Also finished steel products capacity will increase by 46.7% from 22.9 million tonnes in 2006 to 33.6 million tonnes in 2010. Main capacity increases include UAE by 3.1 million tonnes, Egypt by 2.5 million tonnes and Saudi Arabia by 1.9 million tonnes. According to MBR report, raw steel production is expected to reach 51.5 million tonnes and 62.9 million tonnes in 2007 and 2010 respectively.

Due to rising steel demand, which is growing at 9% rate, Middle East to become a net importer of semi finished steel, mainly billet, slab and HR coils. The large increase in consumption of semis and flat products has been partly met by imports, which have been raised from 6.4 million tons in 1997 to around 25 million tonnes in 2005 and is expected to reach 30 million tonnes in 2007. According to the GIC report, GCC countries are net importers of products such as ingots, steel tubes, seamless, hot rolled rod in coil, welded tubes and cast iron pipes. However, net imports are likely to fall back to 5.4 million tons by 2010 with the expected increase in domestic demand.

Arab countries have DRI/EAF plants with total capacity of 8.75 million tonnes. Qatar and Saudi Arabia have started their production in 1978 and 1983, respectively, with production capacity at 0.72 million tonnes and 3.65 million tonnes each, then Egypt with 2.92 million tonnes in 1986 and Libya with 1.46 million tonnes in 1990. Middle East iron ore imports have increased from 14.5 million tonnes in 1997 to 22.2 million tonnes in 2004 and are expected to reach 42.5 million tonnes by 2010.

Currently, GCC countries are negotiating to sign possible Free Trade Agreements with China and India. Such agreements are likely to have a great impact by inducing more imports of finished steel products to the GCC market, mainly from China.

The GIC report added that the Middle East steel consumption has grown by 31.1%YoY from 34.7 million tonnes in 2005 to 45.5 million tonnes in 2006 and is expected to reach 73.3 million tonnes by 2010. GCC countries are considered among the largest consumers of iron and steel products with per capita consumption estimated at 378 kilogram while world per capita consumption is barely 182 kilogram.

MMK plan in Ohio are for auto steel – Report

The Ironton Tribune citing a source close to the negotiations reported that Magnitogorsk Iron & Steel Works is considering a site at Scioto County in Ohio for a proposed USD 2 billion steel plant. The source added that the mill, which will produce auto body sheets could employ between 1,000 and 1,400 workers.

The newspaper also added that talks between MMK and state are still ongoing, and that the Russian steel producer has yet to take a final decision on the matter.

Earlier this week Mr Viktor Rashnikov chairman of MMK said that "We are evaluating the possibilities of establishing or installing a cold rolling mill for production of automotive steel to supply to the car manufacturers, to the car manufacturing plants or auto components suppliers who are in the state of Ohio or around in the neighboring states. Today, we only study we study the norms the legal norms and we study the site conditions. That's why we're not in a position to tell anything definite about the state of Ohio today."

The Ohio Department of Development also issued a statement stating that Lieutenant Governor Mr Lee Fisher visited Magnitogorsk to hold discussions with company officials and that it expected to make a more detailed announcement on the talks later this year. The department added that “Negotiations on major projects are sensitive, and the State of Ohio works to honor its commitments to companies that request confidentiality. Ohio Department of Development officials will likely have more information about this potential collaboration by the end of the year.”

US ITC votes to continue trade case on Chinese pipes

United States International Trade Commission has determined that there is a reasonable indication that a US industry is materially injured or threatened with material injury by reason of imports of circular welded carbon quality steel pipe from China that are allegedly sold in the United States at less than fair value.

As a result of the Commission's affirmative determinations, the US department of commerce will continue to conduct its investigations of imports of this product from China, with its preliminary countervailing duty determination due on or about August 31st 2007 and its preliminary antidumping determination due on or about November 14th 2007.

Status of proceedings
1. Type of investigations: Preliminary countervailing and antidumping.
2. Petitioners: Allied Tube & Conduit Corp, IPSCO Tubulars Inc, Northwest Pipe Co, Sharon Tube Co, Western Tube & Conduit Corp, Wheatland Tube Co and the United Steelworkers of America
3. Preliminary investigations instituted by the USITC: June 7th 2007
4. Commission's conference: June 28th 2007.
5. USITC vote: July 20th 2007
6. USITC determinations to the US Department of Commerce: July 23rd 2007.

The imported products subject to these investigations are welded carbon quality steel pipes and tubes, of circular cross section, with an outside diameter ranging from 0.372 inch to 16 inches inclusive, whether or not stenciled, regardless of wall thickness, surface finish, end finish, or industry specification, generally known as standard pipe and structural pipe.

US Industry
1. Number of producers stand at 20 firms
2. Location of producers' plants at Alabama, Arkansas, Arizona, California, Illinois, Iowa, Kansas, Louisiana, Missouri, Ohio, Oregon, Pennsylvania, Tennessee, Texas and Wisconsin
3. Employment of production and related workers in 2006 at 2,084
4. US producers' US shipments excluding exports in 2006 at 1.4 million short tons valued at USD 1.3 billion
5. Apparent US consumption in 2006 at 2.7 million short tons valued at USD 2.2 billion
6. Ratio of subject imports from China to apparent US consumption in 2006 is by quantity at 26.7% and by value at 19%.

US Imports in 2006
1. From China, 716,184 short tons valued at USD 420 million
2. From other countries, 616,007 short tons valued at USD 467 million
3. Leading sources during 2006, China followed by Thailand, Mexico, and Canada.

ArcelorMittal gets more time to close sale of Sparrows Point

ArcelorMittal has announced that the deadline on the US government mandated sale of its Sparrows Point steel mill in Maryland has been extended to August 6th 2007 from the earlier extended deadline of July 20th 2007, so that it can finish ongoing negotiations.

In court documents, Mittal said that it has been in negotiations with multiple prospective buyers and is in the final stages of negotiations with each of the remaining possible buyers. According to court documents, the US department of justice did not oppose the extension.

ArcelorMittal said that "Although Mittal believes it is very close to completing a final sale agreement, the negotiations are unusually complex and it is unlikely that a signed agreement will be completed by July 20th 2007." It however, declined to comment further on the sales process, which has been underway since the US antitrust agency ordered the mill sold in February 2007. ArcelorMittal has requested several extensions during that time to further pursue negotiations.

The US justice department had ordered Mittal in February 2007 to sell Sparrows Point as a condition of its deal to buy Arcelor SA of Luxembourg that would create the world's largest steel company. The US government ordered Mittal to sell the Maryland mill to preserve US competition in production of tin plates.

Analysts have put the value of Sparrows Point steel mill at up to USD 1 billion. Among the companies which have expressed interest in Sparrows Point in the past is Esmark Inc. Also, Brazilian steel maker Companhia Siderurgica Nacional said earlier in 2007 that it might be interested in buying Sparrows Point.

Imports into Italy from non EU countries up by 33.6% YoY

According to the Italian steel association Federacciai, the imports from non EU countries to Italy have soared by 33.6%YoY to 5.84 million tonnes in January to June 2007.

During January to May 2007, the export amount of Italian steel to non EU countries dropped by around 11.2% YoY to 2.027 million tonnes. Exports of semi finished steel from January to June decreased by 45.7%YoY to 204,000 million tonnes compared to the same period of 2006.

China and Turkey has contributed most of flat products to Italy. The import of hot dip galvanized has extremely increased to 193%YoY compared to the same period in 2006.

Chinese coke exports in June down by 19%YoY

According to statistics from China’s Customs, China coke exports in June 2007 were recorded at 1.3 million tonnes down by 19%MoM from 986,300 in May 2007 yet up 3%YoY as compared to June 2006. During January to June 2007 China exported 8.05 million tonnes of coke increase of 1.48 million tonnes or 18.4%YoY.

As export tariff on coke was raised to 15% from previous 5% since June 1st 2007 suppliers and purchasers failed to reach a consensus on who should afford the increased costs. Besides, domestic demand remained robust dampening exporters initiative and foreign purchasers' imports. As a result, China's coke exports in June 2007 slumped.

At the moment, inventories at Tianjin Port amount to 1.5 million tonnes to 1.6 million tonnes. Export price keeps stable at USD 240 per tonnes to USD 250 per tonnes FOB, some even near USD 260 per tonnes FOB.

(Sourced from MySteel.net)

China to impose duties on aluminum product from August 2007

To further curb exports of high energy consuming, high polluting and resource intensive products and encourage imports of raw materials, China has decided to adjust import and export duties on some aluminum products.

According to the provisional tariff effective as of August 1st 2007, the 5% import duty on electrolytic aluminum will be removed while a 15% export duty will be imposed on non alloyed aluminum bars and rods

(Sourced from MySteel.net)

UK recyclers urged to recover steel from scrap tyres

According to a new report, authored by Dr Egan Archer and Ms Nadia Boyarkina over 100,000 tonnes of steel could be recovered from scrap tyres in the UK each year.

Taking in data from 57 organizations across Europe, the study found that the market for scrap steel was strong in the UK providing a considerable opportunity to recyclers. And it identified concreted reinforcement as a potentially interesting and significant outlet for tyre derived steel. The report suggested that only one steel reprocessing company in the UK uses tyre derived steel.

Dr Egan Archer and Ms Nadia Boyarkina said that significantly less than 33,000 tonnes a year of steel was currently reprocessed in the UK as it was not normally removed from tyres before they were used in landfill engineering or cement kilns. The cost of separating the material and problems with contamination often meant there was currently little incentive to capture it.

Writing in the report, they said that "There is currently little appetite for this type of scrap in the reprocessing sector. Research indicates that there is only one steel reprocessing company in the UK that utilizes a small quantity of tyre derived steel. This company reported tat the quality of the steel they currently receive is poor and they are further scaling back its usage with the intention of stopping altogether."

Mr Steve Waite project manager for tyres at Waste and Resources Action Program said that "With many thousands of tonnes of steel currently available for recovery in the UK, the opportunities in this market are considerable. We are keen to highlight to industry the barriers and potential opportunities to develop processes and guidance that will allow tyre re processor to ensure that they are producing the highest possible tyre derived steel."

The Waste and Resources Action Program, which commissioned the study urged recyclers to do more to capture this valuable waste stream. It is estimated that prices for tyre derived steel could range from GBP 5 to GBP 200 a tonne depending on quality.

Socotherm bags major pipe coating contract in Vietnam

Socotherm, one of the leading companies in the field of pipe coating and insulation for the transport of energy, announced that it has been awarded, through its subsidiary Socotherm Americas SA, an offshore contract in Vietnam for a total value of about USD 11 million.

Under the contract, insulated and weight coated pipes will be laid in the offshore field of Cuu Long in the Vietnamese coast of the Southern China Sea, operated by Hoan Vu Joint Operating Company and forming with other three fields an area which is expected to produce 700 million of barrels in 2010.

Coating works relating to Fusion Bonded Epoxy Anticorrosion Coating Foam Polyurethane Insulation and Concrete Weight Coating of about 51 kilometer of 10 inch diameter pipes will be performed by APC Socotherm at Wollongong (Australia) facilities starting from fourth quarter of 2007. Moreover the contract includes coating of fittings, anodes installation and field joints coating that will be performed on vessel during pipe laying operations.

Mr Zeno Soave chairman & CEO of Socotherm Group said that "The award of this contract is of great strategic importance giving us the opportunity to enter the Vietnam oil market. Until today this area, representing the third oil producer of the South East of Asia and under a process of fast growing has been exclusively dominated by our competitor”.

Socotherm founded in 1859 at Vicenza in Italy is a world wide pipe coating contractor with plants in Italy, Spain, Australia, Malaysia, China, Nigeria, Angola, Qatar, Argentina, Brazil, Venezuela and USA. The Group offers all types of pipe coating services world-wide to the Oil and Gas industry from External/Internal Anticorrosion Coatings to Concrete Weight Coating and Thermal Insulation. Socotherm Group is specialized in Deep Water insulations and provides various systems responding to specific needs of each project. The Group is also active in the design, assembly and sale of pipe coating turn key plants and district heating systems in the field of special Insulation for LNG carriers, transporting liquid gas and in the asphalt road maintenance offering the most advanced systems.

MMK Q2 net profit up by 53% QoQ

FIS reported MMK net profit grew to RUB 26.1 billion in January to June 2007 and its net profit in Q2 of 2007 totaled RUB 15.8 billion up by 53% QoQ as compared to RUB 10.3 million in Q1 of 2007.

MMK said that the growth of net profit is attributed to the increasing rates of growth of revenues from the sale of products, which totaled 16%YoY as compared with the cost of the products sold equal to 11% and also to the reevaluation of the shares in Q2 of 2007.

The cost of MMK assets totaled RUB 176.07 billion in Q2 of 2007 up by 39.6%YoY growth as compared with Q1 of 2007.

ThyssenKrupp opens construction elements subsidiary in UK

German steel giant ThyssenKrupp’s subsidiary ThyssenKrupp Bausysteme GmbH announced that opening if its own sales company for construction systems on the UK market. The company was established in response to the size and strong growth of the market for steel construction elements in the United Kingdom.

Trading under the name ThyssenKrupp Building Systems Limited, it is based in Birmingham and has an office in Glasgow. ThyssenKrupp Building Systems Ltd will sell the entire product range of ThyssenKrupp Bausysteme in the United Kingdom and Ireland.

Mr Iain McQuire MD of ThyssenKrupp Bausysteme said that “In 2005 the market volume was around 600,000 tons, that’s about 60 million square meters of construction elements. The United Kingdom is the biggest market for our products in Europe, and its growth rates of around 3.2% are also significantly above the EU average. As London is staging the Olympic Games in 2012, building activity in all areas of commercial building will receive a further strong boost over the next few years.”

ThyssenKrupp Bausysteme GmbH has been enjoying success on the UK market for several years. With three production sites in Germany and one in Austria, ThyssenKrupp Bausysteme manufactures steel sheet profiles as well as sandwich elements with a mineral wool or rigid polyurethane foam core. The company has already introduced numerous innovations, which have set new standards in building with steel. Its capabilities also include high quality, innovative coating systems such as self cleaning finishes using the Lotus effect. The latest product development is the bi modular sandwich element Hoesch Matrix, a facade element with a completely even joint pattern in both vertical and horizontal directions. With a mineral wool core, these elements permit clearly structured, harmonious facades, which are particularly suitable for prestigious commercial and administration buildings.

CSC output to reach 20 million tonnes by 2011

It is reported that Taiwanese China Steel Corporation plans to invest TWD 200 billion under 5 year plan to 2011 to expand the production to annual 20 million tonnes.

China Steel also said that it increases the high valued products rate to 50% from current around 35%. The firm tries to expand the corporate value and also to avoid hostile takeover.

Australian Sphere lists on the Dubai Stock Exchange

West Perth based mining company Sphere Investments announced that it became the first firm in the iron ore sector to list its shares on the Dubai International Financial Exchange.

The listing creates a regional base for Sphere and its planned development of the USD 1.5 Billion Guelb el Aouj iron ore direct reduction pellet project, in JV with Société Nationale Industrielle et Minière at Mauritania in South Africa.

Mr Alexander Burns MD of Sphere said that "Sphere's listing on the DIFX is significant in that we now have a new financial base that reflects our regional focus and that of our Arab partners in Mauritania and the Gulf."

Mr Per E Larsson CEO of DIFX said that the dual listing of Sphere with operations in Mauritania and business partners in Saudi Arabia and Qatar, underlined the role of the DIFX as a gateway linking its region with the rest of the world. He added that “The DIFX is an ideal listing platform for both international and regional issuers, as it provides strong links to international and regional investors.”

Mayer Steel to build new pipe mill in Vietnam

It is reported that Taiwan’s Mayer Steel is planning to build a new pipe mill in Vietnam after its slitting center has been prepared to run for processing coils.

According to reports, Mayer will focus on mechanical structure purpose pipes, which will be used for machinery, automobile and other mechanical parts. The specialty of such pipe, which requires complicated processing, is lower substitution rate for special purpose usage. Therefore, Mayer can increase their competitiveness and profits.

Mayer will try to get more practical experience such as environmental protection customs and labor condition by running the slitting center in Vietnam. Then Mayer Steel will start to work on its new pipe and tube mill project in Vietnam.

Angang bags another X70 order for Sichuan to East pipeline

It is reported that Angang obtained a big order of 280,000 tonnes of hot rolled pipeline steel from the key project during the 11th Five Year Plan period from Sichuan to the eastern area. The report added that Angang has so far provided 55% of HR pipeline steel the project needed.

Angang won the tender for consecutive four times at pipeline project of gas transportation from Sichuan to the east. In the first tender held in October 2006, the company obtained exclusive right to supply 320,000 tonnes. In the current tender, Angang achieved 280,000 tonnes order for high end pipeline steel. In the gas transportation project from Sichuan to the east, Angang has so far obtained order of 480,000 tonnes accounting for more than half of the total demand and became the biggest supplier of the project by CNPC.

The project undertaken by CNPC is the fifth largest project listed by the China’s State Council next to Three Gorges project, gas transportation project from the west to the east, Qinghai Tibet Railway and water transportation from the south to the north. This project is divided into two parts. One part is to explore, develop and process Puguang gas resources. The other is to build a pipeline from Pugang to Shanghai with total investment of CNY 63.2 billion. The pipeline includes one trunk line to Shanghai a sub trunk line and three branch lines with total length of 1700 kilometers requiring X70 grade of steel.

Jingye reaches 3.5 million tonne hot metal capacity

It is reported that China’s Hebei province based Jingye Group has commissioned its No 8 blast furnace taking its total capacity to 3.5 million tonnes. Uring the first half of 2007, Jingye group launched a number of related facilities in this regard.

After startup of No 7 and No 8 blast furnaces, both of which are 588 cubic meter and can produce 800,000 tonnes of hot metal each, the group's capacity has reached 3.5 million tonnes.

In the Northern area, Jingye has another project underway which will generate 1.5 million tonnes iron & steel each year. Its forecast the group will have 5 million tonnes capacity by next June 2007.

(Sourced from MySteel.net)

Baosteel steps up integration of Baogang Group

It is reported that Inner Mongolian Baotou Steel Union Company Limited approved to go for listing as a whole and as such the cooperation between Baogang Group and Baosteel steps up.

Baosteel may buy shares of Baogang Group by way of adjusting the product mix of its 10 million tonnes production capacity so as to generate USD 10 billion of output value in near future and will cooperate with Bagang Group in building a 5 million tonnes iron and steel project to bring the total production capacity of Baogang Group up to 15 million tonnes.

Baosteel is hoping to take controlling shares of the Baogang Group, but Baogang hopes that Baosteel would be one of its shareholders.

Earlier Baosteel signed an agreement with Handan Iron and Steel Company on building a 5 million tonnes steel project by way of taking same stake as Handan Iron and Steel Company.

Peru’s Volcan lifts zinc and lead output in Q2 of 2007

Metals Insider reported that Peruvian miner Volcan produced about 81,309 tonnes of contained zinc in the Q2 of 2007 up by 14.3% YoY as compared to 71,117 tonnes in 2006.

Volcan said that its production of contained lead rose by 31.7%YoY to 25,178 tonnes from 19,120 tonnes in 2006.

Genco Shipping to acquire 9 more Capesize vessels

Genco Shipping & Trading Limited recently announced that it has agreed to acquire 9 Capesize vessels from companies within the Metrostar Management Corporation group for an aggregate purchase price of approximately USD 1.1 billion.

The 2 of the 9 Capesize vessels have already been built in the first quarter of 2007 and are expected to be delivered to Genco during the third quarter of 2007. It expects to see the remainder of the vessels join their fleet after they are completed between the fourth quarter of 2007 and the third quarter of 2009.

Mr Robert Gerald Buchanan president of Genco Shipping & Trading Limited said that "Consistent with Genco's goal of becoming the bellwether in the industry, the agreement to acquire 6 Capesize vessels will expand the company's fleet of high quality vessels by well over 100% on a tonnage basis. By acquiring the largest class of dry bulk vessels, we will also enhance our position for benefiting from the strong demand for iron ore and coal in China and other developing countries.”

Upon completion of the acquisition, Genco's fleet will consist of 9 Capesize, 7 Panamax, 7 Handymax, and 5 Handy size dry bulk carriers, with a total carrying capacity of approximately 2,559,000 DWT and an average age of 8 years representing an increase of approximately 159% on a tonnage basis.

Mr Ralph appointed as director on AK Steel board

AK Steel announced that Mr Ralph S Michael III has been elected to its board of directors effective from July 20th 2007.

Mr Michael is the president & COO of the Ohio Casualty Insurance Company Fairfield in Ohio. Prior to becoming president & COO of the Ohio Casualty Insurance Company, Mr Michael was executive VP & manager of Private Asset Management for US Bank. He also held numerous executive and management positions with PNC Financial Services Group at Pittsburgh in Pennsylvania before joining US Bank.

Mr James L Wainscott chairman, president & CEO of AK Steel said that "Mike Michael's strong business, banking and metals background will be an asset to AK Steel's board and its stockholders. We welcome his expertise and wisdom to AK Steel."

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.