July, 29 2007
RINL and NTPC to form JV for BF gas based power plant at Vizag
Rashtriya Ispat Nigam Limited and National Thermal Power Corporation Limited have signed a MoU for setting up blast furnace gas based combined cycle power plant of around 150 MW capacities through a 50:50 Joint Venture at Visakhapatnam. The MoU was signed by Mr PK Bishnoi CMD of RINL and Mr T Sankaralingam CMD of NTPC Limited.
The JV shall be established as NTPC RINL Power Company Limited in which NTPC shall have the management control and its chairman shall be nominated by NTPC. The power generation from the proposed Gas Turbine Combined Cycle Power Project unit would be 150 MW. JV would supply the power required by RINL at the bus bar of the project with an option to other consumers.
The benefits of GTCC technology are higher efficiency in terms of more power generation and clean environment in the context of global warming. The GTCC technology is the latest available for utilizing the low calorific value lean gases and it envisages efficient utilization of large quantity of surplus gas available at the steel plant. As per release this would be first of its kind in the Indian steel industry to use the BF gas for power generation.
The average power demand for RINL at 6.3 million tons stage is estimated to be 418 MW and the present generation is 226 MW, which is meeting the present requirement.
Bhushan Steel Limited Q1 net up by 58% YoY
Moneycontrol.com reported that Bhushan Steel Limited announced its results for April to June 2007 quarter.
The performance highlights for April to June 2007 are as under
1. Total sales at INR 1042.74 crore up by 21% YoY
2. Cash profit at INR 169.06 crore up by 35% YoY
3. EBITDA margin is 19.57 % as against 18.79 % in April to June 2006
4. Net Profit margins is 10.46% as against 7.90 % in April to June 2006
5. Net Profit grew by 58% YoY to INR 98.14 crore as against INR 62.25 crore in April to June 2006
Mr Neeraj Singal MD of Bhushan Steel Limited said “The adoption of new technologies, consistency in quality and cost rationalization measures implemented has enabled us to grow our bottom line significantly.”
Bhushan Steel Limited has embarked on a backward integration project in Orissa at an investment outlay of about INR 5000 crore. The first phase of this project comprising of SMS 1, 4 Kilns, 110 MW captive power plant and raw material handling plant is completed and production of sponge iron, power and billets has already started. The whole project will be completed by March 2009.
Jai Balaji to invest in steel, cement and power plant in WB
Mr Nirupam Sen minister for commerce & industries of West Bengal recently announced that Jai Balaji Group would invest INR 16,000 crore to set up a 5 million tonne steel plant, 3 million tonne cement manufacturing unit and a 1,250MW captive power plant at Raghunathpur in Purulia district of West Bengal.
In the first phase, which is expected to be completed in 3 years, Jai Balaji will produce 2 million tonnes of steel annually while the cement factory will produce 1 million tonnes every year. The power plant will have a capacity of 400MW during the first phase for which the total investment will be INR 8,000 crore.
Jai Balaji has sought 4,000 acre of land for the project and the state government has started identifying land at Raghunathpur. Mr Sen in a statement said that “The district administration as well as the West Bengal Industrial Development Corporation has started identifying the land and once it is over, the government will start acquiring the land. In some cases proposals for buying the land directly from farmers are being considered.’’
As per report, While the Balaji group will bring iron ore from other states for the project, West Bengal government will help the group procures the required quantity of coal and will also help it arrange water for the project.
MMTC Q1 turnover up by 11% YoY
It is reported that MMTC Limited has posted highest ever first quarter turnover of INR 6,079 crore up by 11% YoY as compared to April to June 2006. MMTC also posted highest ever quarterly net profit of INR 38.93 crore up by 17% YoY as compared to April to June 2006 quarter.
MMTC’s exports during April to June 2007 quarter touched INR 746 crore up by 7% YoY while imports amounted to INR 5,093 crore up by 14% YoY. MMTC’s domestic trade amounted to INR 240 crore during April to June quarter.
Mr Sanjiv Batra CMD of MMTC attributed the improved performance to aggressive marketing strategies focused on expanding the market and product profile, besides consolidating core areas of competence.
Usha Martin aims cost saving through captive iron ore and coal mining
BL reported that India's leading speciality steel producer Usha Martin is expecting to achieve cost savings of INR 120 crore annually on account of captive sourcing of iron ore and coal.
Mr Rajiv Jhawar MD of Usha Martin old BL that it has already started meeting 100% of its iron ore requirement from its captive mines, while its coal output from the captive sources would begin by the end of 2007-08.
Mr P Bhattacharya JMD of Usha Martin said that during 2006-07, it had formed 3 JVs including one with an Austrian company for making oil tempered wire, a value added product, the production of which would start by March 2008 at Ranchi.
Usha Martin recorded a 22% growth in net sales in the April to June 2007 period and a 58% increase in post tax profit over the same period in 2006-07.
Dhamra Port to secure overseas loans for dredging projects
It is reported that TATA Steel and L&T’s JV company Dhamra Port Company is exploring opportunities for securing foreign loan to fund the dredging cost for the port project in Orissa.
The report cited a Dhamra Port source as saying that “Since the payment for the dredging job has to be made largely in foreign exchange, it makes sense to borrow in foreign currency to make the payment. The rate of interest on foreign loan, even after taking into account the hedging for probable fluctuations in parity rates, should be lower than that on the rupee loan.”
The consortium of 8 banks headed by IDBI Bank is to provide the rupee loan at 9.75% rate of interest. The dredging job is to be undertaken by Belgium based world dredging major Dredging International through its Indian outfit International Seaport Dredging Ltd.
The job presupposes dredging of an 18 kilometers long channel and removal of about 60 million cubic meters of dredged spoilt over 3 years. The dredging cost is estimated at INR 600 crore out of the total project cost of about INR 2,400 crore to be funded largely by loan of INR 1,900 crore and partly by equity of INR 500 crore to be subscribed in equal proportions by the 2 partners.
Shipbuilders seek extension of subsidy
It is reported that Indian shipping ministry is trying to get 10 years extension of the shipbuilding subsidy with a periodical review after 5 years.
With the Indian shipbuilding industry with an order book of about INR 15,000 crore now expected to grow at a compounded annual growth rate of 30%, the finance ministry fears that it may have to dole out about INR 35,000 to INR 40,000 crore as subsidy over the next 8 to 10 years of deliveries if the current subsidy norms were to continue.
The Indian shipbuilders feel that finance ministry’s fears are unfounded. Shipbuilding firms point out that given the current level of taxes and duties on inputs for shipbuilding like steel sheets, the industry would return almost 50% of the subsidy benefits to the government in the initial few years and would return more than the subsidy in subsequent years. They said that “Other manufacturing industries like automobile are protected by the Government by imposing duties and tariffs. However, any company can buy a ship from any country and bring it to India. Given the direct and indirect fiscal benefits extended to shipping firms internationally, Indian shipbuilding firms do not enjoy a level playing field. As of now, costs of building a ship in India are 36% to 37% higher compared to internationally attractive destinations.”
In the absence of the exact extent of benefits from the subsidy in terms of attracting investments, job creation, the ship manufacturing firms have commissioned KPMG to study cost structure of shipbuilding and submit a report. It would also work out the investment required per million tonne of capacity creation and give a comparison of the benefits that European, Japanese, Korean and Chinese shipbuilders enjoy.
At present, the government provides a shipbuilding subsidy of 30% subject to certain conditions that would end on August 14th 2007. Government subsidy accrues to the shipbuilders only when the ships are delivered and orders for the next 5 years would extend for much beyond 5 years.
GE to invest USD 8 billion for infrastructure projects in India
BL reported that General Electric Company is planning to invest USD 8 billion within 3 years for infrastructure projects in India.
The report added that GE has evinced interest in the modernization and expansion of Indian railways and has approached the centre with a proposal to provide assistance in areas like signaling, freight corridor and real estate development along stations. The investment will also be for areas such as port development, warehouses and power plant equipments.
Delhi to get by 8,000MW of power by 2009
It is reported that Delhi would get 8,000MW of electricity from different states to meet its growing demand by 2009.
Ms Sheila Dikshit CM of Delhi at a function to mark five years of privatization of power distribution in Delhi said that “The demand for power is growing fast and we have entered into some agreements to avail 8,000MW of electricity by 2009. The reform process that started 5 years back has started showing results. Currently, Delhi faces far less power shortage than many cities including Mumbai.”
Ms Dikshit said that private distribution companies like BSES and New Delhi Power Ltd too have been asked to set up power plants in order to meet the expected growth in demand beyond 2014.
Mr Haroon Yusuf minister of transport & power of Delhi said that “Delhi has entered into power purchase agreements for sourcing power from Damodar Valley Corporation, Tehri Hydro Development Corporation, National Hydel Power Corporation and National Thermal Power Corporation. And from 2009 onwards, the National Capital Territory of Delhi will have a power surplus.” He added that plans were afoot to set up gas based power plants in Delhi in Bawana and at Bamnauli with a combined capacity of 2,000MW to achieve greater resilience. In 2007, the power demand crossed the 4,000 MW mark.
Mr Yusuf added that “Clearance for the plant at Bawana has been obtained and the work on the ground will begin as soon as gas availability is assured. Work on a new coal based plant of 1,500MW capacity has been taken up by NTPC in Jhajjar in Haryana. Delhi will get 750MW from this plant.”
NTPC Sri Lanka plans delayed
ET reported that National Thermal Power Corporation’s 500 MW coal based plant in Sri Lanka, to be set up in JV with Ceylon Electricity Board, seems to have hit roadblocks. As per report, site for the project is yet to be finalized even though 7 months have passed since the memorandum of agreement between National Thermal Power Corporation, Ceylon Electricity Board and the government of Sri Lanka was signed.
Sources said that the Sri Lankan government had given suggestions for 3 sites, which the Indian side is considering. While, National Thermal Power Corporation had shown a preference for the Trincomalee harbor, Sri Lankan government has pushed for setting up the plant in Sampur, which is wrested out of LTTE control by the Sri Lankan government in September 2006.
Although, National Thermal Power Corporation, in consultation with Sri Lankan government had identified a site near the Indian Oil Corporation oil complex close to Trincomalee harbor as the ideal location for the plant. National Thermal Power Corporation said that they did not have any technical problems with Sampur, however the absence of infrastructure in the area would delay the project.
Sources said that a team from India is expected to visit Sri Lanka shortly to assess possible sites. The plant is supposed to come online in 2011.
GAIL invites bids for legal consultant for IPI
BL reported that GAIL India Ltd, which is the nodal agency for engaging a legal advisor for the multi million dollar Iran Pakistan India gas pipeline project, has invited bids for appointing a legal consultant. The last date for submission of bids is August 8th 2007.
The legal consultant will help in drafting and negotiating various inter state and state level agreements. This will include MoU between the heads of the states of Iran, Pakistan and India and the inter governmental agreement between the 3 nations to facilitate the realization of the project within the territories of these countries.
The appointed entity will also help in formulating agreements to be entered into separately by India, Iran and Pakistan with the project investors to deal with the requirements of each host country individually and the project activity within each country.
Karnataka urges for mega project status to Bellary power project
It is reported that Mr HD Kumaraswamy chief minister of Karnataka has urged central government to accord mega project status benefits to Bellary thermal power project. Mr Kumaraswamy while addressing a national seminar on power said that "I would request the union power minister to take a balance view on the subject and to consider the state's request in extending the tax benefits."
He added that the centre has mooted the concept of mega projects and it identified 5 locations in India. With open access provisions coming into effect, it had become necessary for states to share power during periods of surplus with those in distress and under such circumstances Bellary power would also support the national grid in times of need.
He has appealed to centre to allocate gas for the Bidadi project so that 1400MW of power could be produced besides the assured supply of coal to the state for thermal power generation. To meet the shortage of 3775MW of power in the coming years the state had taken all measures and in this regard a detailed project reports was under preparation. He added that "If new blocks are given I assure that we will start work on at least 3000MW of power. Karnataka Power Corporation Limited has adopted the Vision Statement 2025 and we have plans for developing a few more sites throughout the state and also look at the prospects of going in for super critical boilers in the new locations."
Mr Kumaraswamy further added that the first 500MW unit in Bellary was going to be commissioned by September 2006 and would pump power to the grid this financial year and the work on unit two of 500MW at Bellary was progressing faster than expected.
Pratibha Industries to build water supply project in Mumbai
India’s leading infrastructure developer Pratibha Industries Limited on July 23rd 2007 announced that it has received 2 contracts worth INR 434.86 crore from Municipal Corporation of Greater Mumbai for water supply schemes. The projects would be executed in 45 months.
Pratibha Industries Ltd in a statement said that "The projects are part of Middle Vaitarna water supply project and involve providing and laying of 3,000mm diameter mild steel pipes of total length of 20.7 kilometer and allied works."
Pratibha Industries is engaged in infrastructure business with key focus on water segment.
NHPC starts compensating landowners for Subansiri project in Arunachal
PTI recently reported that National Hydro Power Corporation has given an additional INR 9.6 crore to the Arunachal Pradesh government towards compensation to people likely to be displaced by the 2,000MW lower Subansiri hydel project in Arunachal Pradesh.
Mr Tako Dabi a government spokesman said that the list of people affected by lower Subansiri hydel project was being compiled by the department concerned and the entire amount would be given to them.
National Hydro Power Corporation is yet to sign a MoU with Arunachal government for lower Subansiri hydel project, billed as the biggest hydro power project in India. However, it has started work and spent INR 1,700 crore on the project, which is embroiled in a case filed by some environmentalists in the Supreme Court.
RGPPL to start power generation by mid August
It is reported that Ratnagiri Gas & Power is likely to generate electricity using gas as a feedstock by mid August 2007.
GAIL, an equal promoter in RGPPL has transported gas to the plant through a new pipeline from Dahej in Gujarat. Despite the 577 kilometer long pipeline transporting the gas, the plant could not take gas supplies as RGPPL was not able to provide guarantees for fuel payment. The Dabhol power plant will receive gas at USD 5.84 per million British thermal units.
Petronet LNG has signed a gas sales agreement with GAIL, Indian Oil Corporation and Bharat Petroleum Corporation for off take of the short term LNG it is importing from RasGas of Qatar. After re gasification, the gas is transported through GAIL's pipeline to the power project.
US steel shipment down by 8.2% YoY in May 2007
American Iron and Steel Institute reported that in the month of May 2007, US steel mills shipped 9.087 million tons of steel down by 8.2% YoY as against 9.895 million tons shipped in May 2006 and also down by 2.6% MoM from the 8.849 million tons shipped in April 2007.
US’s adjusted YoY comparison of YTD shipments shows the following changes within major market classifications
1. Service centers and distributors down by 9.3%
2. Automotive down by 2.4%
3. Construction and contractors’ products down by 2.6%
4. Oil and gas down by 9.5%
AISI serves as the voice of the North American steel industry and plays a lead role in the development and application of new steels and steelmaking technology. AISI is comprised of 31 member companies representing more than 75% of both US and North American steel capacity.
Nippon Steel forecasts higher domestic steel demand in H1
JMB reported that Nippon Steel expects Japanese domestic steel consumption is around 39.28 million tonnes in April to September 2007 period up by 60,000 tonnes than same period of 2006.
Nippon Steel sees that the demand is 20.04 million tonnes in July to September 2007, which is 60,000 tonnes higher than same period of 2006. It expects the full year demand increases by 350,000 tonnes to around 79.97 million tonnes for the year 2007 to March 2008 from previous year when the demand keeps high level.
Vorskla Steel to build rolling mill at Zahony in Hungary
Business daily Világgazdaság reported that British Swiss Vorskla Steel AG and the Hungarian government have reached a final agreement that the Ukraine based steel company will erect a metal works in the vicinity of near border town Záhony with EUR 300 million investment. The annual capacity of the rolling mill is planned to be 2.5 million tonnes and its construction can start in the first half of 2008.
When picking the location, Vorskla's main considerations were the proximity of the Tisza River and a possibility to link Ukraine's standard gauge railroads with Hungary's narrow gauge railroads. Construction works of the projects were to start last autumn, but preparations stalled. A feasibility study on a 120 hectare industrial area around Záhony was completed only by the end of August, which named Vorskla as one of the possible tenants.
AK Steel net income in Q2 up by 277% YoY
AK Steel has announced net income of USD 109.9 million for the April to June 2007 up by 277.66%YoY as compared to net income of USD 29.1 million in April to June 2006. AK Steel said that its net sales in April to June 2007 were a record USD 1,869.5 million on shipments of 1,711,400 tons also a record compared to sales of USD 1,497.3 million on shipments of 1,599,100 tons for April to June 2006.
Its average selling price for April to June 2007 was a record of USD 1,092 per ton up by 17%YoY over the USD 936 per ton mark set in April to June 2006 and about up by 1% QoQ than the USD 1,078 per ton level in January to March 2007.
For April to June 2007, operating profit was USD 187.4 million or a record USD 109 per ton compared to USD 63.0 million or USD 39 per ton in April to June 2006. AK Steel said that the YoY operating profit improvement was primarily the result of higher shipments, higher spot market and contract selling prices lower total employment costs corporate wide and lower operating and maintenance costs at the company's Middletown Works.
Mr James L Wainscott chairman, president & CEO of AK Steel said “AK Steel's excellent second quarter results reflect strong shipment levels and prices for our products an outstanding operating performance and our unrelenting efforts to reduce costs. Consistent with our approach for 2007 we continue to put the pedal to the metal as we accelerate toward realizing AK Steel's potential for our shareholders.”
Algoma Steel and USW Local 2724 reach tentative agreement
Canadian steel maker Algoma Steel Inc announced that it has reached a tentative agreement with United Steelworker Local 2724, the bargaining unit for its salaried employees. The release added that “As of the time of this release, no agreement has been reached with Local 2251.
The current collective agreement expires on July 31, 2007.
A member of the Essar Group, Algoma Steel Inc is based in Sault Ste.
Marie, Ontario. As a fully integrated steel producer, Algoma's revenues are derived primarily from the manufacture and sale of rolled steel products including hot and cold rolled sheet and plate.
Kumba Iron Ore H1 earnings up by 38% YoY
Anglo American majority owned Kumba Iron Ore Ltd turned in a 38% rise in first half net profit on increased sales volumes and higher iron ore export prices. It said that its half yearly net profit was ZAR 1.58 billion (USD 223 million) against a pro forma ZAR1.14 billion in H1 of last year. Its revenue for the period rose 35% on the year to ZAR 5.43 billion.
The performance is boosted by 11% increase in weighted average iron ore prices on export volumes coupled with weakening in the average exchange rate of the rand during the period. The company said however that operating expenses had remained under pressure due to increases in labor, contractors, raw materials, fuel, energy and other input costs.
It mined some 51.2 million tonnes of ore in the first half up by 23% YoY on last year due to increased activity at Kumba's Sishen mine. Export sales volumes for the six months were 5% higher at 11.8 million tonnes, which Kumba said reflected strong demand as well as sales of ore in the first three months of 2007 that had built up at South Africa's Saldanha port after equipment failed in September.
According to the group, the Sishen Expansion Project continues to progress towards completion within its budget. It said "The jig technology to be used by SEP allows Kumba to process B grade material with a Fe content of between 55% and 60% and consequently 4.9 million tonnes of this material was stockpiled during the period, primarily as feedstock into the jig plant. This had a positive impact on unit costs at Sishen Mine.”
Kumba Iron Ore Limited was created last year with the breakup of South African minerals company Kumba Resources Ltd.
China uses 590 million tonnes of coal for power generation in H1
According to China Electricity Council statistics China's power generation industry used more than 590.78 million tonnes of coal in the H1 of 2007 up nearly 18% YoY. The statistics added that China's power plants with more than 6,000 KW in capacity used 356 grams of coal per kilowatt hour, 8 grams lower from the same period last year.
CEC said in a release that the national power supply and demand remained basically stable with most parts of the country reported less power shortages. It also predicted that with an installed capacity of 90 million KW in 2007, most regions will see power surplus after the summer.
The government of China has been pushing power companies to switch to cleaner power sources such as natural gas. But demand is rising so fast that China is expected to rely on its dirty but abundant coal reserves for most of its power in coming years.
Gibraltar Industries Q2 sales up by 5% YoY
Gibraltar Industries Inc announced that its sales from continuing operations in April to June 2007 were USD 370 million an increase of approximately 5%YoY as compared to USD 352 million in April to June 2006. The increase was largely the result of acquisitions. Sales from existing businesses declined by approximately 7% a result of lower activity levels in the residential housing and automotive markets.
For January to June 2007, sales from continuing operations were up by approximately 2%YoY to USD 687 million compared to USD 675 million in January to June 2006.
Mr Brian J Lipke chairman & CEO of Gibraltar said that “On a sequential basis our sales and earnings were much stronger than our first quarter results and within our expectations. The steps we have taken to diversify and broaden our business portfolio most notably our move into the commercial building and industrial markets our international expansion along with solid contributions from our recent acquisitions helped our second quarter performance. We continue to pursue our strategy to be the low cost producer of our products on a global basis. We are also targeting acquisitions such as Dramex and Noll/Norwich that will add to our product leadership positions in niche markets, while enhancing our ability to deliver the higher performance characteristics we have established for our business. We are also continuing to review all of our businesses to ensure that they meet our performance targets.”
Gibraltar Industries is a leading manufacturer, processor and distributor of products for the building, industrial and vehicular markets. The company serves customers in a variety of industries in all 50 states and throughout the world. It has approximately 3,600 employees and operates 83 facilities in 26 states, Canada, China, England, Germany and Poland.
Colombia Boyacá region to attract steel makers
BNamericas cited Mr Edgar Jiménez an analyst at local brokerage Promotora Bursátil saying that investing in central Colombia's Boyacá is a good move for steelmakers interested in consolidating their presence in the country.
Mr Jiménez said that "There is a healthy amount of natural resources in the region and most importantly the steel sector has everything it needs because not only is there iron ore but also limestone and coking coal." He believes that Boyacá is important because now there is a merger underway between Hornos Nacionales and Aceros Sogamoso, which are located half an hour from the APR plant and close to all of that mining potential in the department."
He further added that speculation abounds in Colombia that mergers and acquisitions will continue in the steel sector. One rumor claims that Votorantim and fellow Brazilian Grupo Gerdau are very interested in Boyacá companies. There is some fierce competition for this market, which has been handled with a very low profile, but there are rumors about possible agreements.
Colombia's principal iron ore deposits are located in Boyacá in the areas of Belencito and Samacá where local steelmaker Acerías Paz del Río is located. Acerías Paz del Río is 52% owned by Brazilian group Votorantim.
According to figures from the Latin American Iron and Steel Institute, in the first half of 2007, Colombia produced 604,800 tonnes of crude steel, up by 3.5%YoY over 584,300 tonnes, while primary iron production fell by 2.6%YoY to 170,900 tonnes. The structure of Colombia's steel chain is made up of integrated and semi integrated steelmakers, steel fabricators and traders and wire producers.
Zinifex shareholders approve Nyrstar plan
It is reported that shareholders in Australia’s Zinifex Limited recently approved a plan to combine its smelters with those of Belgium’s Umicore SA to create the world’s largest zinc metal producer. A total of 99% of votes favoured the plan to create Nyrstar.
Mr Peter Mansell chairman of Zinifex at a meeting of shareholders last week said that the new company would start operations in September before a share sale to be held as early as October.
Mr Tony Barnes acting CEO said at the meeting “The combination will allow both of the companies to grow in their own right and get the appropriate value recognition.”
The venture will surpass Seoul-based Korea Zinc Co as the world’s biggest producer of the metal used to galvanize steel.
Vietnam attracting huge investments in steel sector
Vietnam News Agency reported that Vietnam’s steel industry is heatening up on the back of foreign investors queuing up to take advantage of the Vietnam’s expanding economy and increasing demand for steel from the domestic construction sector.
Mr Pham Chi Cuong president of the Vietnam Steel Association while speaking with a Vietnam News Agency’s correspondent said that the presence of big international steel groups in Vietnam reinforced the attractiveness of a Vietnamese steel market that has been fuelled by an average yearly domestic demand growth of 40%. Mr Cuong outlines some of the likely major investments as under
1. India’s TATA Group’s proposed project near the Thach Khe iron mine in central Ha Tinh province that when fully operational will roll out 4.5 million tonnes a year.
2. South Korean POSCO Group is now planning to invest in a steel plant with a total output capacity of 3 million tones of rolled steel at the Phu My 2 Industrial Zone in southern Ba Ria Vung Tau province. Work on the 1 billion USD plant is scheduled to begin in August.
3. POSCO has also signed a deal with the Vietnam Shipbuilding Industry Corporation Vinashin to build a steel complex with a capacity of 5 million tonnes of steel plates and rolled steel per year.
4. India’s Essar has also linked up with the Vietnam Steel Corporation and the Vietnam Rubber Corporation on a 527 million USD project in Ba Ria Vung Tau province that will pump over 2 million tonnes of rolled steel per year into the domestic market.
5. 5. Taiwan’s Tycoons and E United have received the green light from the local authorities to invest 1.8 billion USD in a plant in the Dung Quat Economic zone. Construction of the plant is slated to begin in mid October.
In addition, several smaller projects including a JV in Hai Phong to produce steel pipes and rolled steel and another in Ho Chi Minh City to manufacture corrugated iron are underway.
Mr George E Kobrossy GD of Zamil Steel Vietnam, which has been operating in the country for over a decade said that low cost work force, political stability, incentives from the Vietnamese Government and a readiness of local businesses to cooperate as primary reasons for the boom in the industry.
Macarthur Coal records 17% fall in Q4 sales
Macarthur Coal Limited has recorded a 17%YoY decline in coal sales to 1.05 million tonnes for the April to June 2007 as compared to April to June 2006. Macarthur Coal Limited said that the fall is due mostly to off site infrastructure issues including rail and port congestion, which are expected to continue to impact sales for financial year 2007-08.
Macarthur Coal Limited said that the shipping congestion has continued with 55 ships anchored off Dalrymple Bay Coal Terminal awaiting loading with loading delays of 28 days at the end June. Macarthur Coal Limited added that “Congestion continues to be experienced at all coal ports along the eastern seaboard of Australia.”
Macarthur Coal also recorded a decline in YTD production, which was 23%YoY below the previous year to 3.8 million tonnes as they were impacted by significant infrastructure constraints. However, the group advised that sales for the full year were slightly ahead of the revised target provided earlier in the year.
In April, Macarthur reduced its annual sales target from 4.5 million tonnes to 3.7 million tonnes for financial year 2006-07, but said its profit forecast for the year remained the same. MCC is forecasting a net profit after tax of AUD 63 million to AUD 73 million for the full year.
US Steel Gary Works to increase use of biodiesel
Mr Becky Skillman Lieutenant Governor of Indiana recently joined officials of US Steel to announce that US Steel’s Gary Works is phasing in the use of biodiesel in their fleet. Mr Becky said that “Moving to B5 biodiesel is one of the ways US Steel is leading by example to improve the environment and promote alternative energy. I encourage other manufacturing companies to join them and take advantage of our Hoosier homegrown energy for their transportation and manufacturing needs.”
B5 biodiesel is a blend of 5% soy based biodiesel and 95% traditional diesel fuel. The conversion to B5 began in April 2007 at the Gary Works. US Steel has tested B5 biodiesel in plant locomotives with great success. The company plans to transition to B10 biodiesel for this equipment in two to three months. Currently 85 pieces of equipment use a blend of soy based biodiesel and diesel fuel. By the end of July 2007 nearly 150 pieces of equipment including loaders, dump trucks, flatbeds and Bobcats will be fueled by B5 biodiesel. The fleet uses an average of 7,000 gallons of fuel a week.
Mr Mike William GM of US Steel Gary Works said "We are pleased that Gary Works has been able to take a leadership role in Northwest Indiana by implementing biodiesel in our mobile equipment fleet. Environmental stewardship is a core value at US Steel and the efficient and cost effective use of a renewable and cleaner fuel like biodiesel in our fleet meets our goal and is the right thing to do."
US Steel is currently looking to build on the success at Gary Works by using biodiesel throughout the company beginning with facilities in the United States. The move to B5 biodiesel at the Gary Works came with the assistance of South Shore Clean Cities Inc of northern Indiana.
Baosteel supplies steel for suspension for Nissan new model
It is reported that Baosteel is in race for supply materials for producing new car of Dongfeng Nissan Japan. Nissan’s March4 automobile is still on the earlier stage of designing and will be put on the global market in 2009.
In April 2007, Dongfeng Nissan placed attestation order for all of 13 parts in suspension system of the model. Many of the order are of high strength with short lead time and most are produced as the first time. Having closely cooperated with each other, Baosteel's units conducted production and delivery in completely compliance with Japan's technology standard.
As per report 6 tonnes of Baoshan's 13 types of high strength steel for suspension system have already been delivered to Nissan headquarter in Japan for attestation. These materials will not only receive rigorous quality attestation in Nissan headquarter plant but also undergo collision tests across the world.
Baosteel is a forerunner in the Chinese market to produce auto suspension system in large scaled and systemic manner.
22 small plants in Inner Mongolia shut down
According to a report from Bayanzhuoer City’s economy committee 22 small irons melting plants in Bayanzhuoer which didn’t meet the industry standards in China were cut off electricity and shut down. And the equipments are required to be demolished in a limited time. The total capacity of these small iron melting plants was 1.20 million tonnes with the largest 86,000 tonnes and the smallest 14,000 tonnes.
The report added that these plants are of those high energy consuming and pollution companies with a great lot of dusts and sulfur dioxide and other harmful materials emission therefore they are listed in the five types of plants the Mongolia government wants to wash out which includes small oil refinery, small glasswork, small cement works, small iron steel plants, and small coal based power station.
Mechel commissions new excavators at Southern Kuzbass
Mechel OAO announced the commissioning of new mining machines at the open pit mines of its coalmining subsidiary Southern Kuzbass OAO. The new machines were put into operation in line with the technical re equipment program of Southern Kuzbass OAO and would allow Mechel to increase efficiency of coal mining and reduce production costs.
Two new hydraulic backhoe type excavators with 11 cubic meter bucket capacity were put into operation at Krasnogorsk and Sibirginsk open pit mines. The total cost of the machines was approximately RUB 178 million (USD 7 million).
The newly commissioned Liebherr R-994 excavators are designed for more complete and selective coal seam extraction with an open cast method of coal mining at lower levels, for water drainage and road construction. The excavators require only half the number of workers to operate as compared with other models of backhoe type excavators, which is expected to result in increased labor productivity. In addition, the commissioning of the new machines will enable reduced operational losses of coal by 2% to 4%, increased coal output, and reduced risk of environment pollution.
Similar model excavators are successfully used at Mechel's Korshunov Mining Plant subsidiary. Mechel plans to commission similar machines at other open pit mines at Southern Kuzbass OAO, Olzherassk and Krasnogorsk in September of this year.
The renewal of equipment at Southern Kuzbass OAO is part of Mechel's long term capital expenditure program, which is aimed at increasing coal output to 25 million tonnes by 2010. In line with Mechel's plans, investments in developing Southern Kuzbass will amount to approximately USD 700 million in the period from 2007 to 2011.
Straits Asia’s coal production in Q2 hit due to heavy rain
It is reported that Singapore listed coal producer Straits Asia Resources Ltd with mines in Indonesia said that its output fell in the second quarter because of heavy rainfall. Its production dropped to 623,000 tonnes in April to June 2007 from 834,000 tonnes in January to March 2007 quarter. Its sales of coal in April to June 2007 fell to 652,000 tonnes from 851,000 tonnes in January to March 2007.
Straits Asia Resources said that “In the first six months, coal output fell to 1.45 million tonnes from 1.64 million tonnes, with sales declining 14% to 1.5 million tonnes.”
Straits Asia Resources said “Sebuku coal mine’s production for the quarter was below expectation due to a prolonged wet season. In the six months to June 2007, Sebuku recorded rainfall far in excess of the historical average for the period.”
Ukrainian steel consumption to double by 2012
Ukrainian Journal citing Mr Andriy Parkhomchuk sales director at Metinvest reported that Ukraine’s steel consumption would double within the next six years to about 15 million tonnes annually.
Mr Parkhomchuk added that Ukraine’s steel production at the same time would increase to 50 million tonnes in 2012 up from about 40 million tonnes in 2006.
NanoSteel makes super hard steel commercial available
The NanoSteel Company, an industry leading producer of nano structured steel alloys for industrial applications, announced the commercial availability of its latest alloy line utilizing the company's patented Super Hard Steel technology.
SHS 9700 features an ultra refined crystalline microstructure, up to a thousand times finer than existing solutions and extreme hardness up to 69 Rc without the use of nickel, molybdenum or tungsten. SHS 9700 produced in a range of cored wire diameters suitable for MIG/Open-Arc/Submerged-Arc applications and as an atomized powder for PTA applications, provides exceptional wear resistance in severe abrasion environments up to five times that of traditional chrome carbide and complex carbide materials. SHS 9700 is available in 25 per pound and 125 per pound to 500 per pound bulk spooled wire packaging for MIG/Open-Arc/Submerged-Arc welding and 10 per pound bottle and 25 per pound bucket powder packaging for PTA welding.
The improved hardness and wear performance and cost effective pricing of SHS 9700 makes it an attractive hardfacing and wear plate welding material for commercial end users needing to extend the service life of mission critical parts and components on ground engaging tools and materials processing equipment used in industries such as mining, construction and oil & gas.
Mr Dave Paratore president & CEO of NanoSteel said that "The hardfacing market in recent years has been hit hard by the increasing costs of certain raw materials. We set out to design a product that completely eliminated the dependence on these elements while providing significantly better performance. SHS 9700 goes even further than our previously released materials by completely eliminating the need for tungsten. It fills a unique position in the wear solutions market by offering customers performance between complex carbide and tungsten carbide products at a cost effective price."
CVRD concludes feasibility study for Bayóvar project in Peru
Brazilian Companhia Vale do Rio Doce announced that it has presented to the Peruvian government studies evidencing the feasibility of a project for exploitation of phosphate deposits in Bayóvar located in Piura department.
CVRD has revised its estimate for annual average production capacity, previously foreseen as 3.3 million tonnes to 3.9 million tonnes per year. The project also contemplates the installation of a harbor for Panamax type boats which aimed at serving phosphate export activities.
Following the feasibility studies, CVRD will develop an environmental impact study to be concluded in the end of August 2007. It will also define the project implementation schedule after evaluation and approval of the study by the Peruvian government.
Bayóvar project is a world class deposit, whose reserves are estimated at 270 million tonnes of phosphate rock. In March 2005, CVRD won the international bid promoted by the Peruvian government to develop studies to explore the deposit.
Greif Inc opens eight packaging plant in Russia
Greif Inc recently announced that it has opened its eighth industrial packaging plant at Kazan in Russia. The new plant currently produces intermediate bulk containers. By the end of 2008, the plant will also produce plastic canisters and large steel drums and employ nearly 100 people.
Michael J Gasser chairman, CEO & president of Greif said that “Russia continues to be an important growth market for Greif and we are committed to providing our customers in the country with world class quality, cost effective industrial packaging and services for their products. Our Kazan operation adds the new element of IBCs to our existing Russian product portfolio of steel drums and water bottles. We are excited about our new capability and the benefits it brings to our customers in the region.”
Greif is a world leader in industrial packaging products and services. It produces steel, plastic, fibre, corrugated and multiwall containers, protective packaging and containerboard, and provides blending and packaging services for a wide range of industries. Greif also manages timber properties in North America.
Northwest Pipe Q2 sales up by 30.76% YoY
Portland based Northwest Pipe has posted sales of USD 102 million during April to June 2207 period up by 30.76% YoY as against USD 78 million during same period of 2006. Its earning during the period is USD 5.6 million as compared with USD 7.3 million in same period of 2006.
The second quarter of 2006 included a USD 7.7 million pretax, nonrecurring gain on the sale of the Riverside property. Northwest said that excluding the sale of the Riverside property results are stronger in the second quarter of 2007 than in the second quarter of 2006.
Sales in the Water Transmission Group for the second quarter of 2007 were USD 69.5 million as compared with USD 51.3 million for the second quarter of 2006. The Tubular Products Group's sales were USD 28.9 million in the second quarter of 2007 as compared with USD 22.6 million for the second quarter of 2006. Sales in the Fabricated Products Group were USD 3.5 million in the second quarter of 2007, compared with USD 3.9 million for the same period in 2006.
For January to June 2007 period, Northwest Pipe had sales of USD 193 million with earnings of USD 10.1 million as compared with sales of USD 157 million with earnings of USD 10 million in the same period of 2006.
Northwest Pipe manufactures welded steel pipe and other products in three business groups. It had completed the purchase of Continental Pipe Manufacturing Co's Pleasant Grove in Utah.
UK structural steel strong despite shift in manufacturing bases
It is reported that the decline of manufacturing in the UK has not hit steel fabricators and erectors as hard as expected. Although heavy industry has migrated to Europe, the logistics associated with sorting, storing and transporting these goods manufactured elsewhere has spawned a whole industry in itself. This has proved profitable for steel fabricators and contractors with the rise in warehouse and shopping centre construction more than offsetting the drop off in construction of manufacturing facilities.
According to the UK Structural Steel Market Research Report compiled by Market & Business Development the UK market for structural steel has demonstrated YoY growth since 2001 with the exception of an 11% decline in 2005. MBD anticipates that output will increase during every year between 2006 and 2011 with annual growth rates of between 1% and 5%. This forecast is backed up by Mr Derek Tordoff director general of the BCSA who predicts a further increase in output of 1% to 2% this year.
Steel's market share has now hit record levels and the British Constructional Steelwork Association reports that its members' order books are healthy. The latest Construction Market Shares survey, commissioned by Corus shows that in 2006 steel's share of the multi storey market rose by 3.7% to 71.8%, while in the key office market steel's slice rose from 71.9% in 2005 to 73% in 2006.
Mr Alan Todd GM of Corus said "Steel remains the leading choice even when only direct costs are considered. Once speed of erection, flexibility, predictability of project completion and all the sustainability benefits are factored in it is no surprise that steel is achieving record market shares."
Norfolk Southern Q2 net income up by 5% YoY
Norfolk Southern Corporation announced that its net income of USD 394 million for the April to June 2007 up by 5%YoY compared to USD 375 million in April to June 2006. For the January to June 2007, its net income was USD 679 million as compared with USD 680 million same period of 2006.
Railway operating revenues for April to June 2007 were USD 2.38 billion, down by 1% compared with April to June 2006. For the January to June 2007 railway operating revenues were USD 4.63 billion, down by 1% compared with the same period of 2006. Continued weakness in the automotive and housing industries contributed to a 4% reduction in volumes for both the April to June 2007 and January to June 2007 compared with record volumes reported in 2006.
Coal revenues for the April to June 2007 were USD 579 million down by 1% YoY compared with April to June 2006. For January to June 2007 coal revenues were USD 1.14 billion down by 1% YoY compared to same period of 2006. In both periods, higher average revenue per unit largely offset the effects of reduced volumes.
Mr Wick Moorman CEO of Norfolk Southern said that “We are pleased to report year over year improvement in our financial results, especially during a quarter characterized by continued softness in certain segments of the economy. Our focus remains on strengthening our service, growing our revenue base, controlling our costs, and developing our work force, in order to better serve our customers and investors in this changing economic environment.”
Norfolk Southern Corporation is one of premier transportation companies in Canada. Its Norfolk Southern Railway subsidiary operates approximately 21,200 route miles in 22 states the District of Columbia and Ontario in Canada serving every major container port in the eastern United States and providing superior connections to western rail carriers. Norfolk Southern operates an extensive intermodal network in the East and is North America's largest rail carrier of metals and automotive products.
Tiangong International IPO oversubscribed
XFN ASIA reported that China based Tiangong International Company retail tranche of its Hong Kong IPO was about 668 times oversubscribed, while the international tranche was very significantly oversubscribed.
Tiangong said that is pricing the IPO at the high end of its indicative price range between HKD 5.40 and HKD 6.36 due to a strong response from retail investors. It is expected to raise net proceeds of HKD 574.9 million from the IPO, which will be used to expand its production facilities and repay bank loans.
Due to oversubscription, the total shares offered to retail investors will be increased to 50% from the original 10% of the total 130 million shares offered.
Tiangong International is engaged in the manufacturing and selling of high speed steel, high speed steel cutting tools and die steel.
TMK Volga completes overhaul of Trubopressovogo plant No 2
It is reported that TMK’s Volga Tube plan has completed the overhaul of its trubopressovogo plant No 2. VTZ said that work has been completed in accordance with the schedule for 20 days by 6 contractors and repair of the plant, just more than 400 people.
Trubopressovy plant No 2 Volga Tube Factory produces seamless pipe in diameter range of 42mm to 219mm, which are used in the power plant engineering, petrochemical industry, oil and gas industry. The pipes are made in accordance with the standards of API, EN, DIN and ASTM. Its production capacity is about 68,000 tonnes of hot pipes per year.
