BHEL to build SAIL ISP captive power plant

It is reported that SAIL has awarded an INR 765 crore turnkey order to Bharat Heavy Electricals Limited for setting up a 62.2MW captive power plant as expansion project of its IISCO steel plant in West Bengal. The project is slated for commissioning in a tight schedule of 29 months.

The power plant will be equipped with state of the art multi fuel gas fired boilers, specifically designed to utilise waste gases. The plant would utilize waste gases emanating from the steel making process such as blast furnace gas, basic oxygen furnace gas and coke oven gas.

BHEL's scope of work in the project envisages design, engineering, manufacture, supply, erection and commissioning of the captive power plant, in addition to complete civil works. BHEL would supply three steam turbine generator sets of 18MW each, multi fuel gas fired boilers of 200 tonnes and turbo-blowers and other associated auxiliaries to the captive plant.

TATA Steel may acquire iron ore assets overseas

It is reported that TATA Steel would be looking at acquiring iron ore asset overseas as a part of larger strategy to make TATA Corus combine sustainable in terms of raw materials.

Mr Tata chairman of TATA Group said that “Having security of raw materials and supply is an essential part of the well being of this enterprise. There are very large consuming countries such as China because of which there is a raw materials scarcity, which has to be met for companies to be sustainable. So, yes, we are looking at that.”

Speaking about his group’s acquisition appetite, Mr Ratan Tata said that “Because of the size and scale of the Corus deal, we seem to be cast as a group on an acquisition spree, which is not the case. We would be interested in an acquisition only if there is a product gap that it can fill, there is a strategic fit, or a particular geographical presence that it offers. TATA Steel is looking more at organic rather than acquisition led growth. We have been looking at three Greenfield sites in India.”

UGSL sees steel price hike by month end

Uttam Galva Steel Limited sees a hike in steel prices by September end due to increase in raw material prices and freight prices. Mr Ankit Miglani director of UGSL during an interview with moneycontrol.com said that “As far as mild steels are concerned, I am quite confident that at the month end, there will be a hike in prices of some sort.”

Mr Miglani said that “I cannot commit right now at what value that price will be because it will not be decided till the end of the month. Everyone will evaluate how the market is and then take a fresh call on the prices. We have to keep in mind that there are long term contracts to consider as far as mild steels are concerned, so there are a lot more variables. But there is absolutely no doubt that all raw material prices and freight rates have gone up significantly, everything is contributing to an increase in prices coupled with the fact that this is the beginning of the demand side.”

He added that “It is not just iron ore, coke prices have gone up, coal prices have gone up, freight has gone up, overall every aspect of a costing has gone up. So there would most certainly be an impact.”

Market price based royalty on iron ore mining recommended

It is reported that a government report has recommended that royalty rates for iron ore be fixed at 10% of the market value to boost the states’ share of revenues, as international prices of the commodity soar. The recommendations need cabinet approval and if adopted, the proposal of the study group on royalty for major minerals will mark a fundamental shift in the calculations of iron ore royalties.

The study is being coordinated by the mining ministry with representation from several mineral bearing states. They have suggested that the Indian Bureau of Mines prepare an iron ore price chart every month. Iron ore rich states have also raised concerns about how royalties can be collected from steel companies with captive mines. Chhattisgarh has demanded the sale price listed by the National Mineral Development Corporation Limited be taken as a benchmark.

At present, India’s royalty rates on iron ore are the lowest in the world, following the archaic practice of prices based on every tonne extracted from the ground instead of market value, known as an ad valorem rate. Despite global prices of iron ore skyrocketing, states continue to get between INR 16 and INR 27 a tonne.

According to reports, Jharkhand and Chhattisgarh have demanded a royalty hike of 20%; Orissa has claimed an even higher 22% to 25%. Karnataka put its demand at 10%.

India will need 55% more coal by 2012 – B&K

Investment bank Batlivala & Karani said that India would need 55% more of the fuel by 2012. Batlivala & Karani, citing data from Crisil Ltd, an Indian unit of Standard & Poor’s, said that India will need 730 million tonnes in 2012 compared with 470 million tonnes in 2007 while imports will rise by 70% to 68 million tonnes.

Batlivala & Karani said that "The ongoing capital expenditure boom in the power, steel and industrial sectors makes the implied jump in demand for coal in India an unquestionable reality and coal remains the cheapest and most abundant fuel.”

India’s USD 854 billion economy, Asia’s fourth biggest, has expanded at an average of 8.6% in the past 4 years. That’s boosted demand for coal to feed power plants and steel makers.

JSW targets 30 million tonnes per annum steel by 2020

It is reported that JSW Steel has targeted to produce 30 million tonnes per annum steel by 2020 and has charted out its expansion plan to achieve it. Currently, the Bellary unit in Vijaynagar in Karnataka produces 3.8 million tonnes per annum and is planning to expand it to 10 million tonnes per annum by 2010 in 2 phases.

Mr Seshagiri Rao MVS director finance of JSW Steel said that "In phase I we will expand from 3.8 million tonnes per annum to 6.8 million tonnes per annum by March 2009. In phase II, which will be complete by September 2010, the capacity will be hiked from 6.8 million tonnes per annum to 10 million tonnes per annum."

He added that JSW Steel mainly produces flat steel products of all grades. In the galvanising product segment, it has 14% market share while in hot roll coil about 12% and is planning to capture 15% overall market share by 2010.

JSW Steel is also planning to introduce long steel products in the market. After the expansion it will produce of 1.5 million tonnes per annum long steel products and 8.5 million tonnes per annum flat steel products. Besides the brownfield expansion at the Bellary unit, it is also setting up 2 Greenfield units, 1 in Jharkhand and the other in West Bengal.

Mr Rao said that "Preliminary work is in progress in both the locations. We are acquiring land, tying for raw material linkages and shifting utilities. It will take at least a year to start construction on the plants. In West Bengal, JSW will produce 3 million tonnes per annum in phase I and expand in 2 more phases. Similarly, in Jharkhand, the project will be implemented in phases. We have estimated the project to cost INR 3,000 crore per million tonne. The debt to equity ratio will be 1:1. We are planning to raise funds from international and local markets for the expansion."

Mr Mukesh Ambani becomes world's richest Indian

PTI reported that Mr Mukesh Ambani chairman of Reliance Industries has overtaken Mr LN Mittal president & CEO of Arcelor Mittal to become the richest Indian in the world due to the unprecedented boom in the Indian stock market.

As per report, Mr Ambani's net worth has soared past USAD 50 billion dollars making him fourth richest person in the world after Mr Bill Gates of Micosoft, Mr Carlos Slim Helu Mexican business baron and Mr Warren Buffett.

Based on the closing share prices of various group companies such as RIL, Reliance Petroleum, IPCL and Reliance Industrial Infrastructure, Mr Mukesh Ambani is estimated to hold shares worth USD 50.1 billion dollars through promoter holdings in these companies. The four companies together have a market value of USD 103 billion dollars

As per report, Mr Mittal owns shares worth about USD 48.4 billion dollars in ArcelorMittal based on EUR 55 per share value giving it a market cap of about USD 108 billion.

However, it may be noted that while the net worth of Mr Ambani and Mr Mittal are based on the current market values of their group companies, that of Mr Gates, Mr Buffett and Mr Carlos Slim are based on figures for August end.

CIL calls for hiking coal prices by 10%

It is reported that Coal India Limited has urged union government to raise coal prices by 10% immediately to save its subsidiaries Eastern Coalfields Limited and Bharat Coking Coal Limited from slipping into the red.

A coal ministry official said that the issue came up in a recent meeting of the ministry held to review coal production during the first 5 months of the current fiscal year.

He pointed out in the meeting that India’s actual coal production during the April to August 2007 period stood at 158.57 million tonnes against a target of 172.25 million tonnes, indicating a shortfall of 13.68 million tonnes. The overall production of Coal India Limited during April to August 2007 was 139.19 million tonnes against a target of 142.76 million tonnes down by 92.6%. Bharat Coking Coal Limited saw marginal growth in coal production of 0.52% during April to August 2007.

Godawari Power & Ispat takes ex CIL chairman on board

Godawari Power & Ispat Limited has announced that its board of directors, at its meeting held on September 25th 2007 has appointed Mr Shashi Kumar ex chairman of Coal India Limited and Mr Biswajit Choudhary ex CMD of United Bank of India as non executive independent directors on the board of the company.

Its board also approved the capital expenditure program for setting up following facilities at a cost of INR 235 crores
1. Iron ore crushing plant with a capacity of 1.2 million tons per annum
2. Iron ore beneficiation plant with a capacity of 0.10 million tons per annum
3 Iron ore pelletization plant with a capacity of 0.60 million tons per annum
4. Railway siding and other infrastructure development etc

The projects shall be partly financed by rupee term loan or external commercial borrowings from the banks upto INR 150 crores and partly financed by way of fresh issue of equity capital upto INR 100 crores either in the form of QIP issue or by preferential allotment or in any other form as may be decided in consultation with the investment bankers.

TATA Steel for direct talks with land owners for Titanium project

It is reported that TATA Group has formed local teams for direct negotiations with landowners at the site of its proposed INR 2,500 crore titanium dioxide plant in Tuticorin in Tamil Nadu.

This decision has been taken so that landowners get a fair price for their land. Only waste and dry land will be acquired for setting up the TATA plant in Tamil Nadu.

State government's policy on the TATA plant is that it will not be a party to procure land or negotiate with landowners.

Gangotri Iron & Steel to commission new units soon

BL reported that Gangotri Iron & Steel is expanding capacity through new TMT bar and wire rod plants located near Patna and hopes to commission them shortly.

Mr Sanjiv Kumar Chowdhary MD of Gangotri Iron & Steel said that the 0.12 million tonnes per annum billet and TMT facilities with an investment of INR 50 crore would be commissioned by the end of next quarter and the 60,000 tonnes per annum wire rod plant with an induction furnace would become operational in April 2008 at a cost of around INR 14 crore.

As per report, the projects are likely to result in huge cost savings. Mr Chowdhary said that “The advantage would accrue on 3 counts, 7.5% price preference from government orders, 90% VAT refund and relief on CST for sales in the neighbouring states.”

Gangotri Iron & Steel would soon issue about 4 million shares to mop up around INR 12 crore, including premium. It has already raised around INR 8.5 crore through warrant conversions and INR 27.75 crore through borrowing from SBI.

Essar Shipping orders 6 bulk carriers

It is reported that Essar Shipping & Logistics has placed an USD 210 million order for 6 Supramax bulk carriers with ABG Shipyard. The vessels, to be built at an estimated cost of USD 35 million each, will be delivered between December 2009 and March 2011.

The new double hull and double bottom vessels would be environment friendly and incorporate futuristic design while complying with the latest and most stringent international maritime organization regulations. The vessels will have a length of 190 meter, a beam width of 32.26 meter and deadweight of 54,000 tonnes and fitted with 36 tonne cranes with the grab.

These vessels are expected to be in high demand over the coming years considering the fact that the entire handymax segment is inching towards larger tonnage. Essar plans to deploy these vessels for global trade. The acquisition has been made keeping in view the increased demand for larger size vessels in the handymax segment of the dry bulk trade.

Mr Sanjay Mehta CEO of Essar Shipping & Logistics said that “The decision to build these 6 bulk carriers stems from Essar’s strategy to be equipped for future business needs. These vessels will go a long way in consolidating our position.”

Essar Shipping & Logistics is a part of Essar Global Limited. It has 5 operating companies in its fold, including Essar Oilfields Services, which focuses on offshore and onshore drilling activities and Vadinar Oil Terminal, which has invested in crude oil and petroleum product terminals, Essar Logistics, which is in the business of logistics management, trans shipment and cargo handling services, Essar Shipping, which owns and operates 27 ships including VLCCs, product tankers and bulk carriers and Essar Bulk Terminal, which specializes in building and operating bulk terminals and also undertakes dredging operations.

PFC receives Golden Peacock Awards 2007

It is reported that Power Finance Corporation has bagged the prestigious “Golden Peacock Award for Excellence in Corporate Governance” for the year 2007.

Dr VK Garg CMD of Power Finance Corporation received the award at a special function attended by business leaders, corporate governance experts and policy makers from 34 countries in London on September 20th 2007.

World council for corporate governance and centre for corporate governance to encourage initiatives in corporate governance globally and in India instituted the award scheme for corporate governance in January 2001.

Golden Peacock Awards are the highest accolades of corporate excellence in quality, corporate governance, corporate social responsibility, innovation, training, environment management, technological leadership and business leadership. They provide not only worldwide recognition and prestige but also a competitive advantage in operations. The awards are considered unique for they have meticulously defined and transparent selection criteria and is determined by highly elaborate and independent assessment process.

Vikash Metal gets UN okay for carbon credit project

Vikash Metal & Power Limited announced that it has received approval from a UN body for a carbon credit project. Its waste heat recovery captive power plant would reduce 55,000 tonnes of carbon dioxide equivalents a year.

Under the Kyoto Protocol, developed countries can meet greenhouse gas reduction targets by paying poor and developing countries to make cuts for them, in a trade in carbon offsets worth USD 5 billion last year. Each unit of carbon credit represents one tonne reduction in greenhouse gas emission.

China unlikely to increase steel export taxes further this year

A senior China Iron and Steel Association official told Interfax at the 2007 China Steel Export Summit held in Beijing on September 20th 2007 that the Chinese government is unlikely to impose any further restrictive polices on steel product exports in the remaining months of this year, due to the success of the current policy in curbing steel product export growth.

Mr Chen Ling deputy director general of the CISA's Metallurgical Industry Economic Research and Development Center said that "The central government does not intend to release any further restrictive policies on steel product exports this year, as current export tax policies are recognized as effectively controlling steel product exports. China's steel product and slab net exports will be in excess of 50 million tonnes this year.”

Mr Chen added that “Although steel product exports were still at high levels in August, we've seen a noticeable fall in growth rates, and this is mainly a result of increased export taxes. Steel product exports are still increasing, and this is mainly due to global demand. However, we have to admit that China's steel production growth is currently outpacing growth in domestic demand, and moderate growth in exports will help solve the domestic oversupply problem and ensure the healthy development of the international market."

However, Mr Chen Kexin senior economist from the Ministry of Commerce's Distribution Productivity Promotion Center said that "China is still excessively exporting steel products and the National Bureau of Statistics has found that export growth is outstripping production growth. However, the Chinese government will continue to pay close attention to steel product exports for the remaining three months of the year and will release further restrictive policies if the current ones are deemed insufficient." Mr Chen also suggested that China should invigorate the current underdeveloped domestic demand for steel products and use part of current exports to supply the domestic market.

According to statistics released by the General Administration of Customs that China exported 5.38 million tonnes of steel products in August, down 9.4% from July 2007 and exported a total of 45.08 million tonnes of steel products in January to August 2007, surging 83.8% from January to August 2006.

Hot band spot prices continue upturn globally

SteelBenchmarker reported that the US hot rolled band spot price for September 24th 2007 up by 0.7% to USD 576 per ton on FOB mill basis for the third consecutive time. The World export HRB price rose by 2% to USD 574 per ton FOB port of export for second consecutive time. The Chinese HRB ex works price fell by 2.1% to USD 477 per ton, for the fourth consecutive rise. And the Western European HRB price rose by 1.5% at USD 680 per ton ex works for second consecutive time.

1. US
USD 576 per metric ton FOB mill
Up by USD 4 per ton from USD 572 two weeks ago
Down by USD 54 per ton from of USD 630 on April 9th 2007
Up by USD 16 per ton from USD 560 on August 13th 2007

2. World Export Price
USD 574 per tonne FOB the port of export
Up by USD 11 per ton from USD 563 two weeks ago
Down by USD 22 per tonne from USD 596 on March 26th 2007
Up by USD 24 per ton from USD 550 on July 23rd 2007

3. Western Europe
USD 680 per metric ton EXW
Up by USD 10 per ton from USD 670 per ton from two weeks ago
Down by USD 16 per ton from USD 696 on June 11th 2007
Up by USD 20 per ton from USD 660 on March 12th 2007

4. China
USD 477 per metric ton EXW
Down by USD 10 per ton from USD 487 two weeks ago
Up by USD 20 per ton from USD 457 on May 14th 2007
Up by USD 75 per ton from USD 402 on July 9th 2007

SteelBenchmarker publishes steel benchmark prices for HRB, CR coil, rebar, and standard plate in the US, Western Europe, mainland China, and the world export market every fortnight.

Bekaert consolidates its activities in Venezuela and Colombia

Belgian steel wire and cord manufacturer Bekaert has signed an agreement with Siderurgica Venezolana Sivensa SA for the acquisition of 50.002% of the shares in Vicson SA resulting in full ownership for Bekaert. The purchase price related to this transaction amounts to USD 35.5 million. Both parties anticipate a timely closing of the transaction.

Vicson SA, which is located in Venezuela, manufactures wire products for industrial, construction and agricultural applications. The company staffs 650 employees. With an annual production capacity of about 100,000 tons it records annual sales of EUR 100 million.

Bekaert also indirectly acquires a majority interest in the JV Productora de Alambres Colombianos SA Proalco SA in which Vicson SA has a 75% share. Combined with the 12.5% share that Bekaert holds through its JV in Ecuador, Bekaert becomes 87.5% shareholder of Proalco SA. This company staffs 340 employees and posts annual sales of € 50 million. Proalco produces similar wire products for the Colombian market.

Mr Oscar Augusto Machado Koeneke president of Sivensa that “We have come to a good agreement with our longstanding partner Bekaert on the sale of our share in Vicson SA. This decision is fully in line with Sivensa’s business strategy to concentrate on the hot briquetted iron and steel businesses, in which the company has steadily grown in recent years.”

Mr Bert De Graeve CEO of Bekaert said that “Latin America is for Bekaert a growth market which is in full development. This agreement is important as it allows us to strengthen our strategic positions in Venezuela and Colombia.”

ArcelorMittal's update on second step of merger

ArcelorMittal and Arcelor have announced further details on the merger of ArcelorMittal into Arcelor and the upcoming publication of the legal documentation relating to this merger. Following effectiveness of the merger of Mittal Steel Company NV into ArcelorMittal on September 3rd 2007, this merger constitutes the second step of the previously announced two-step merger process between Mittal Steel and Arcelor.

The release said that on May 16th 2007, Mittal Steel, ArcelorMittal and Arcelor announced that they would propose to the shareholders of ArcelorMittal and Arcelor to implement the second-step merger based on a ratio of 7 Arcelor shares for every 8 ArcelorMittal shares.

It added that on September 25th 2007, the boards of directors of ArcelorMittal and Arcelor unanimously decided that
1. To restructure the share capital of Arcelor prior to the effectiveness of the second-step merger so as to have a one to one exchange ratio in the merger and thus limit the effect of the merger on the ArcelorMittal share price and hence its comparability pre and post merger; this restructuring will take the form of an exchange of every 7 pre-restructuring Arcelor shares for 8 post-restructuring Arcelor shares, mechanically resulting in an adjusted merger exchange ratio of one new Arcelor share for every one ArcelorMittal share without any economic effect on Arcelor or ArcelorMittal shareholders;
2. To approve the documentation relating to the second-step merger, including the European prospectus to be approved by the Luxembourg Commission de Surveillance du Secteur Financier and the preliminary US proxy statement/prospectus to be registered on Form F-4 with the US Securities and Exchange Commission;
3. To convene on November 5th 2007 the Arcelor and ArcelorMittal extraordinary general meetings to vote, among other things, on the merger.

The release said that ArcelorMittal and Arcelor shareholders would each be asked to vote on the merger at their respective extraordinary general meetings of shareholders, both to be held on November 5th 2007 in Luxembourg. The extraordinary general meeting of Arcelor will also resolve, among other items, on the share capital restructuring and the renaming of Arcelor to ArcelorMittal.

The release added that “If the merger is duly approved by the Arcelor and ArcelorMittal shareholders and all other conditions precedent have been satisfied or waived, the merger of ArcelorMittal into Arcelor is expected to be effected on or about November 13th 2007. Upon the effective date, the Arcelor shares that will be issued in this second step merger will be listed on the same exchanges as those on which Arcelor shares are currently traded. Arcelor shares will also be listed on Euronext Amsterdam by NYSE Euronext and the New York Stock Exchange on the effective date so that after the merger the Arcelor shares will be listed on all exchanges where ArcelorMittal shares are currently listed.”

Tangshan to supply SBQ plates to Hyundai Heavy Industries

Tangshan Steel Group has recently signed a cooperation agreement with Korea's Hyundai Heavy Industries that promises joint technology research and stable supplies of ship building quality plates to Hyundai Heavy Industries, the biggest ship builder in the world.

The SBQ plates will be supplied from Hebei based Tangshang Steel Group subsidiary, Tangshan Plate Company, a 51:49 JV between Shenzhen listed Tangshan Steel Co and privately owned Hebei Wenfeng Steel.

According to an Hyundai Heavy Industries Shanghai official the exact tonnage that Tangshan Plate will supply is not yet determined because the firm has only just entered Hyundai Heavy Industry’s ship plate supply chain with the September 13th 2007 agreement and many details are still to be discussed.

She added that Hyundai Heavy Industries is rapidly stepping up ship plate purchasing in China and the builder is very keen to introduce new Chinese suppliers. This year, Hyundai Heavy Industries is planning to purchase 680,000 tonnes to 730,000 tonnes of ship plate from China.

A Tangshan Plate official said that Tangshang Plate commissioned its first plate line in mid August 2006 that boasts a capacity of 1.5 million tonnes per year or 125,000 tonnes per months. In August it produced about 130,000 tonnes including about 40,000 tonnes of ship plate. Meanwhile, the company is currently building another 3,500mm plate mill with a matching 120 tonnes converter that is expected to be commissioned late 2008 and will double Tangshang Plate capacity. A third plate rolling line of 2 million tonnes per year capacity is in Tangshan Plate's construction plan, but details such as width and the construction schedule are currently unavailable.

(Sourced from Mysteel.net)

Baosteel acquires a 92.5%stake in Nantong Steel

Interfax China reported that Shanghai listed Baoshan Iron and Steel Company Ltd has acquired a 92.5% stake in Baosteel Nantong Iron and Steel Company Ltd for CNY 601 million (USD 80.04 million).

Baosteel and Nantong Steel both are subsidiaries of Baoshan Iron and Steel Group China's largest steel maker. In early August 2007 Baosteel Group put the 92.5% stake in Nantong Steel up for auction on the Shanghai United Assets and Equity Exchange.

Though a transfer kept within one of the Baosteel Group's subsidiaries was preferable, the company had stated that it would consider non Baosteel bidders.

Baosteel made the bid for the stake transfer on the grounds that Nantong Steel, which has an annual output capacity of 1 million tonnes of steel billet would serve as a useful billet production base for Baosteel's seamless steel pipe production.

Nantong Steel established in December 1994, specializes in the production and sales of reinforced steel, round steel, profile steel and steel billet.

EU to investigate write off of loan to Petortub in Romania

It is reported that EU would investigate if the Romanian government should have written off about USD 37 million owed by Petrotub now controlled by Mittal Steel Co NV.

EU said that it doubted the legality of the Romanian decision to waive and reschedule debts before pipe and tube maker Petrotub was privatized and sold to Mittal Steel in 2003. If its probe finds that the money is effectively an illegal state subsidy, the EU can order that the company, now called Mittal Steel Roman, pay back the EUR 26 million.

EU regulators said that they would check if the privatization was economically more advantageous for the government than seeing the company collapse as Romania argues. But they said the state should not be counted as a single creditor and Romania would have to prove the economic benefits of privatization for each state agency.

The investigation is unusual because state subsidies granted before a country joined the EU are normally exempt from strict state aid rules. EU governments are not allowed to fund businesses unless they can justify it using a narrow set of terms, showing that the money will not give the company an unfair advantage over others. Romania became part of the EU on January 1st 2007. However, the EU said the steel sector had special rules that allowed it look into this case.

Mr Ratan Tata opens “De Brug” at Corus in Netherlands

It is reported that Corus Research, Development and Technology recently opened its new building at Corus in IJmuiden in the Netherlands, called “De Brug” in the presence of Mr Ratan TATA chairman of TATA Steel.

Designed by Mr Jan Elissen of Saarberg, Van der Scheer & Partners, the new building features a characteristic front made of steel, which stretches between the two wings of the building, like a bridge and can house 200 researchers. The building has an open, modern and transparent character designed to inspire researchers to exchange information and develop new ideas and it will form the knowledge centre for Corus in IJmuiden.

Mr Philippe Varin CEO of Corus said “We’re delighted to have Mr Ratan TATA with us to open the new building for Corus RD&T in IJmuiden. Both Corus and TATA Steel have a shared vision of the role of RD&T in improving the competitive position of our enterprise and adding value to our customers through world-class technology. Work done here and at Corus’ other RD&T centers will form the basis of a lot of the innovation and technological development for our enlarged group. In that sense, the name of the new building, “De Brug”, meaning “bridge” is relevant in more ways than one.”

CRD&T employs over 900 researchers of which 500 are based in IJmuiden at Corus’ integrated steelworks. CRD&T finds solutions for the market to improve and innovate the application of steel. Process and product innovations are focused on quality, applicability and sustainability. CRD&T cooperates with universities and research institutes all over the world, like the NIMR and through the Corus’ business units cooperates with major customers in the automotive, transport, construction and packaging markets.

Corus in IJmuiden produces about 7 million tonnes of high quality strip and coated steel products for the automotive, construction and packaging sectors.

GVM Metals to acquire 60% stake in SA Tshikunda Coal Project

Australian mineral processing and coal mining company GVM Metals Limited announced that it has executed a Heads of Agreement to acquire 60% of the issued capital of Tshikunda Mining Limited, a company owned by Basani Investments Limited and Ndilo Resources Limited which owns the Tshikunda Coal Project, a 32,000 hectares property situated between the Company’s Baobab project and Exxaro’s Tshikondeni coking coal mine.

Completion of both transactions will take GVM’s interest in the Tshikunda Coal Project to 60%. The consideration payable to acquire Tshikunda is ZAR 20 million (approximately AUD 3.5 million), subject to the following suspensive conditions:
1. Obtaining the necessary approvals in terms of section 11 of the Mineral and Petroleum Resources Development Bill of South Africa
2. Obtaining the requisite approvals of the South African Reserve Bank as are applicable
3. Obtaining any required approvals from the ASX.

Mr Simon Farrell MD of GVM said that the acquisition was an important development in the Company’s goal of becoming a major player in the development of the Limpopo coalfields. He said that “Whilst very limited work has been undertaken on the area in the past, it is now widely considered to be highly prospective as a significant source of hard coking coal. What is particularly exciting is that both Rio Tinto and ourselves believe the rank of coals improve eastwards of their Chapudi and our Baobab projects and given that the value of coking coal is now roughly double that of thermal coal, the dependence of a proximate power station to get the project up and running starts to disappear.”

Rumor of further steel export taxes raise market concerns in China

According to Shanghai Securities News the market talk has that China's top planning body National Development & Reform Commission intends to further raise up the export duty on steel products, which has been opposed by China Iron&Steel Association and the leading steel mills.

The newspaper cited that Mr Luo Bingsheng vice director of China Iron&Steel Association has also warned that Beijing is likely to unveil stricter curbing policies once the steel export rebounds in the fourth quarter at a recent raw materials conference.

China's steel product and semis export in the first eight months amounts to 45.08 million tonnes and 5.61 million tonnes respectively. There is no doubt that the steel export would break over 50 million tonnes in 2007 and some industrial analysts even predict 68 million tonnes. Such massive steel export has posed great threat to the country's energy conservation, environmental protection and international trade relations.

As a result, the rumor is circulating that the authority is considering removing the entire tax rebate for steel exports and again raise up the export duty for either long products or flat products to 15% and 25% for semis.

Mr Hu Chunli head of Industry Development Research Dept of NDRC, reiterates that curtailing steel export expansion is the main theme of China's steel industry policy. He added that Beijing is mulling over further restrictive measures like introducing a qualification license system for steel exporters and putting a cap on steel processing trade etc. However, both steelmakers and senior officials of CISA reveal that too frequent policy changes are not good for the steel market.

(Sourced from MySteel.net)

Baotou to fund exploration at Centrex Eyre Peninsula iron ore deposits

It is reported that Centrex Metals has signed a deal worth up to USD 40 million to develop one of its Eyre Peninsula iron ore deposits. Under the agreement, Baotou Iron and Steel will spend up to USD 40 million to progress
In return for its investment Baotou will earn half of Bungalow's expected total annual production of 3 million tonnes of magnetite concentrate. It will spend USD 8 million on the project over the next year, which will take it to a 10% stake. A further USD 8 million will take it to 20% with a final USD 24 million to cover the cost of a BFS, bringing it up to 50%.

Baotou already has a 10.13% stake in Centrex and has agreed to take one million tonnes of hematite ore for five years from Centrex's neighbouring Wilgerup iron ore project due for production start up next year.

Rohrwerk Maxhütte to modernize stretch reducing mill

It is reported that Rohrwerk Maxhütte GmbH, Sulzbach Rosenberg, Germany has placed an order with SMS Meer for the repair and modernization of its existing stretch reducing mill. The repair and modernization measures are scheduled for the beginning of 2008.

The existing stretch reducing mill that forms part of a push bench plant consists of 28 stand positions that are driven via a mechanical superimposition gearbox. The drive system of the stretch reducing mill and the CARTA® automation system installed on the stretch reducing mill by SMS Meer in 1989 will be modernized to meet the latest demands on the stretch reducing process.

The rotary saw installed downline of the stretch reducing mill will be upgraded for a pipe pass speed of 8.5 meter per second and equipped with an innovative pipe support system so that the thickened ends inherent in the stretch reducing process can be discharged directly behind the rotary saw.

Within the framework of this modernization, SMS Meer is to supply a. additional roll stands for the stretch reducing mill, the design data for the drive system, the new equipment necessary for modernization of the existing rotary saw and upgrading of the CARTA® system. SMS Meer’s scope of supplies and services also includes the supervision of erection and commissioning.

The stretch reducing mill serves to produce pipes in the small diameter range from 21.3 mm up to 139.7 mm with wall thickness up to 13.0 mm. The drive system of the stretch reducing mill is furthermore also designed for the production of square and rectangular hollow sections.

Brazil steel exports in 8 months down by 13.5% YoY

Brazil steel institute IBS in a report said that exports by Brazilian steel makers in January to August 2007 of 2007 were worth USD 4.12 billion compared with January to August 2006 up by 9% YoY from USD 3.78 billion.

However, export revenues from local producers last month amounted to USD 528 million down by 22.2% YoY over USD 679 million in August 2006.

In volume, Brazil's steel sales abroad reached 6.5million tonnes in the January to August 2007 down by 13.5% YoY from 7.5 million tonnes in January to August 2006. Exports in August alone totaled 810,800 tonnes down by 29.6% YoY as compared to 1.15 million tonnes in August 2006.

Iranian steel sector needs government funding

According to Mr Mohammad Rahim Rasti MD of National Iranian Steel Company development of steel sector will be brought to a standstill if the Iranian government stops investing in steel projects. Mr Rasti told IRNA news agency that domestic investors are unable to invest IRR 3,000 billion to IRR 4,000 billion in this field. He underlined that development of steel sector is not an easy task and needs state support.

Turning to the implementation of eight steel projects in various provinces, Mr Rasti said that the projects are aimed at developing deprived areas. He said that five steel projects are being implemented in
1. Mianeh in East Azarbaijan province
2. Shadegan in Khuzestan province
3. Neiriz in Yazd province
4. Qaenat in South Khorasan province
5. Chaharmahal in Bakhtiari province.

The official added that tender offers for three other projects in Sabzevar in Khorasan Razavi province, Baft in Kerman province and Bafq in Yazd province would be received until October 19th 2007. The contracts will be signed within two to three weeks after receiving of offers.

Mr Rasti noted that steel production has not posted a significant growth in the first half of the current Iranian year to March 2008. He recalled that steel output grew by 3% to 4% during the six month period. The official said that since new steel projects have not gone into production cycle from last year, the rise in steel output had been meager. He predicted that Iran’s steel production would significantly increase with the implementation of Hormuzgan steel project next year. The scheme has the capacity to produce 1.5 million tons of steel per year.

Mr Rasti said the government halted exports since early this year to regulate the domestic market. He said “We should preserve our continuous presence in international markets otherwise we can not reenter the market easily as the domestic market is moving toward equilibrium in supply and demand.”

Russia and China likely to reach understanding on pipe imports

Interfax reported that the Russian Pipe Industry Development Fund expects to sign an agreement with China Iron & Steel Association on imports of pipes to Russia's domestic market by the end of September 2007.

Mr Alexander Deineko director of Russian Pipe Industry Development Fund at a press conference in Chelyabinsk said that "We want to encourage the conclusion of an agreement on parameters of the presence of China's pipe products on the Russian market. This work has been under way over the previous three or four months. The latest trip to China was in late August. We hope that our Chinese counterparts will come here and we will sign an agreement by the end of September."

He added that if such an agreement is not signed, Russia is determined to reserve the right to impose restrictions on imports of pipe products from China.

World Shipping Summit to be held in Tianjin

Exim News Service reported that WORLD Shipping Summit 2007, one of the industry’s most important events, is to be held on November 1st to November 2nd 2007 at Tianjin in China.

The topics to be discussed are
1. Cooperation between finance and shipping
2. Port congestion
3. Port expansion
4. Dxploration of new markets
5. Mergers and acquisitions
6. Freight rates
7. Costs and business opportunities in new markets

The summit expects to attract about 1,000 participants from government and the trade, within China and abroad.

Votorantim starts steel plant construction at Resende in Brazil

Rusmet reported that Brazilian company Votorantim Metais has begun to build a metallurgical plant producing profiled iron with the capacity of 1 million tons per year at Resende in the state of Rio de Janeiro. The investments for the construction will make USD 518 million.

Votorantim Metais said that the realization of the project would allow increasing its capacities to 1.7 million ton per year in Brazil. The company exteds the capacities of the enterprise Barra Mansa from 500 till 700 tons per year.

Besides, the company posseses 52% of the shares of the company Paz del Río in Columbia. Votorantim Metais will be able to produce 2 million tons of metal products per year considering 300 thousand tons of the metallurgical plant in Columbia.

Sabic plans to double steel production capacity

Platts reported that Saudi Arabian steel manufacturer Sabic is set to almost double its production of rebar, coils and billets to 1.8 million tonnes per year.

The report cited a Sabic spokesman as saying that “By early February 2008, it is expected the expansion program will have reached its half way point with works due for completion by 2008. We are selling a lot of material to Kuwait and the UAE and there is a lot of demand from all of the GCC countries. We are also receiving a lot of enquiries from Egypt, Syria Jordan and Iraq, but we are mainly focusing on Gulf countries."

The spokesman added that demand, was particularly strong from the rapidly developing United Arab Emirates and as production increases the company will be required to up it raw material inputs, currently split 80% iron ore, principally sourced from Brazil, to 20% scrap from the local, Turkish and Russian markets. With scrap prices on the up and the cost of steel billets gaining ground on finished products some prices hikes on the company's output could be expected. He added that shortage of available trucks used by the company to transport materials to its customers could also lead to future price increases as it vied with other industries to charter long term haulage contracts.

Vietnam investigating steel makers to curb price hikes

It is reported that the Vietnam’s state Inspectorate announced plans to investigate skyrocketing steel prices.

The Inspectorate said after several months of spiraling construction grade steel prices it will form a team to research and analyze costs, inventories and volumes of steel purchased and sold by every business in the nation's major provinces and cities.

The Inspectorate also warned that trade fraud revealed by the probe will face the full force of the law.

Steel prices in Vietnam have reached all time highs well over VND 8 million per tonne because of a continuous rise in global prices, the country's overwhelming dependence on imported raw steel products and speculation.

Western Plain Resources to start Coober Pedy iron ore mine in 2008

It is reported that a USD 110 million iron ore mine near Coober Pedy in Australia is expected to start production within a year. Western Plains Resources said it had finished a feasibility study on its Peculiar Knob mine, which showed it was both technically feasible and economically viable.

Western Plains Resources said "Subject to the timely receipt of all necessary approvals and the completion of all documentation, it believes the project can be brought into production at the rate of at least 2.7 million tonnes per annum by the fourth quarter, 2008, with exports to commence soon thereafter."

Development of the mine would include
1. A 132 person camp
2. A 3 million tonne per year ore crushing and screening plant
3. An 85 kilometers road to the Wirrida siding on the Adelaide to Darwin rail line.

Once the mine is operational, it would send about eight trains of ore to Whyalla a week. It would be loaded onto large vessels 10 kilometer offshore in the Spencer Gulf.

Mr Bob Duffin executive chairman of Western Plains Resources said the Sydney based company expected its mining lease to be granted in February next year, with its mining and rehabilitation plan to follow shortly afterwards. He said that “We think that we can be in production by the end of next year and there is a fair bit of upside. We would be spending money on the project before the mining lease is granted. Obviously we cannot start digging the hole before then, but we will commit to the design work before that.

Mr Duffin said the life of the project is estimated to be six years but it could be extended if more reserves were found or a nearby deposit at Hawks Nest is incorporated into the mining plan. He added that the company expected ore sales and mine financing agreements with the China based Focus Group to be finalized before the end of the year. He also added that the project had been put out to public consultation and had not met with any opposition so far.

Bluescope appoints Mr Robinson as president for Bluescope Lysaght Australia

BlueScope Steel Limited today announced that Mr Greg Robinson has been appointed to the position of president of BlueScope Lysaght Australia. He will be taking over from Mr Bob Moore current president of BlueScope Lysaght Australia, who will be undertaking a new role as president of BlueScope Steel China.

Mr Robinson has over 26 years of experience in the steel and mining industries and is a senior BlueScope Steel executive with extensive international experience. In his most recent role, Mr Robinson was Regional GM for a BlueScope Steel subsidiary Butler Manufacturing Company based in the US. Prior to his appointment to this role in August 2004, he co led the due diligence and integration teams for BlueScope Steel's AUD260 million acquisition of Butler Manufacturing Company.

Mr Robinson has held a number of operational and senior management positions with BlueScope Steel and BHP Billiton including VP finance of the Industrial Markets businesses, VP finance North Star BlueScope Steel and VP finance at the Whyalla Steelworks.

Severfield-Rowen net profit during H1 up by 33% YoY

Yorkshire based structural steel group Severfield Rowen Plc announced its H1 results of 2007. Severfield Rowen Plc said that during January to June 2007 period its revenue was GBP 137.56 million up by 5% YoY as compared to GBP 130.77 million in January to June 2006 period and operating profit was GBP 15.16 million up by 33% YoY from GBP 11.39 million. Profit before tax increased by 34% YoY to GBP 15.88 million.

(In GBP million)

Mr Peter Levine chairman of Severfield Rowen said that “Severfield Rowen continues to make significant and sustained progress and delivered yet another set of record half year results. Profits, earnings per share, cash balances and dividends all increased significantly and we are particularly pleased with achieving a double digit operating margin. This progress is reflected in current trading being in line with management’s expectations. Our record order book gives us excellent visibility and we continue to operate in buoyant markets which are experiencing high demand for large scale projects. The integration of Fisher Engineering into the Group will enhance our geographical exposure, giving us a substantial foothold in the Irish market.

Mechel Targoviste outlines expansion plans to conference delegates

Russian mining and metals companies Mechel OAO announced that representatives of the international business community made a working visit to Mechel's Romanian steel subsidiary, Mechel Targoviste. The visit was arranged within the framework of the 10th Central and Eastern European Steel Conference.

The 10th Central and Eastern European Steel Conference, which took place during September 18th to 20th 2007 at Bucharest in Romania, was organized by Metal Bulletin. The conference analyzed the development of steel markets and production in the Central and Eastern European countries, the outlook for industry consolidation, and investments in the development of distribution networks and new technologies.

On the first day of the conference, Mr Victor Trigubko vice president of Mechel presented it’s experience in extricating its Romanian steel assets from the heavy market downswing and decapitalization to improve profitability and meet modern requirements for production technology. These experiences, including fulfillment of the privatization obligations ahead of schedule, were acknowledged by the business community with operations in the region as worthy of attention.

As part of the presentation, Mechel also arranged a field trip for the conference delegates to Mechel’s Targoviste steel plant on September 20th 2007. Attending delegates included approximately 40 businessmen, international and local business media journalists and representatives of the government authorities. During the tour of the plant, Mr Vyacheslav Shmyga GD of Mechel presented the projects already implemented at the plant including the continuous casting machine with the capacity of 500,000 tonnes a year commissioned in March of this year, the upgraded complex of electric arc furnace and small section mill heating furnace. He informed that the medium section mill to be completely reconstructed in 2009.

Mechel expects to invest approximately USD 35 million to modernize Mechel Targoviste through 2011. The plan for 2007 includes an increase of the steel output and sales to more than 480,000 tonnes and about 440,000 tonnes respectively. In line with the objectives of Mechel's capital investment program, significant investments will be made in arrangements to reduce production costs and increase steel quality at Mechel’s steel subsidiaries.

Raspasdaskya H1 net profit surges

RBC reported that Raspadskaya's net profit under IFRS during the H1 of 2007 surged 1.8 times to USD 90.419 million as compared to H1 of 2006.

Raspadskaya revenue during the H1 of 2007 up by 55% YoY to USD 338.834, gross profit jumped almost 1.9 times to USD 195.705 million, EBIT increased 1.8 times to USD 136.127 million, while EBITDA rose by 66% YoY to USD 198.844 million.

Raspadskaya's coal output during the perion up by 29% YoY to 6.6 million tonnes and is expected to reach 13 million tonnes by the end of the year, with coal concentrate sales to rise 38.5% to 9 million tonnes.

Mr Gennady Kozovoi GD of Raspadskaya noted that the robust growth figures the company reported for the first six months of 2007 set the pace for the entire year. The company management expects the results for the following year to be as good or better.

Noble to start Brazilian iron ore shipments to China in October

Reuters reported that Hong Kong based commodities trader Noble Group would ship its first load of iron ore from Brazil to China in October.

Mr Harry Banga VC of Noble told Reuters that Noble chartered ship would transport 70,000 tonnes of iron ore from Suape in northeastern Brazil on October 7th 2007, as part of a deal which will last till 2011. He added that the order was a very substantial project for Noble, without revealing financial details.

In July, Noble bought a 30% stake in Brazilian iron ore company Mhag Servicos E Mineracao for USD 60 million, with the company holding exclusive marketing rights for the ore in China.

Gulf launches rail feasibility study

It is reported that the GCC railway project has launched a feasibility study into the construction of the international rail network. A consortium of three rails and engineering consultancies French group Systra, Canarail of Canada and Lebanese consultant Khatib & Alami will carry out the study which is expected to take between 12 and 18 months.

The three were appointed to the project earlier this summer and will analyze potential routes financing options and a cost sharing formula between the nations involved. The study will concentrate on a network conceived in 2004 for the entire GCC and Mashreq region by the UN Economic and Social Commission for Western Asia.

The full network entails 16 lines. The key route will run from Iraq down the eastern coast of the Arabian Peninsula, taking in Kuwait, eastern Saudi Arabia, the UAE and Oman. Connecting branches could be added to Qatar and Bahrain. A further line will run from northern Syria down the Red Sea coast to Yemen. The approximate length of the full network is 19,000 kilometers 60% of which does not currently exist.

A consultant close to the project said “The main route will take in the GCC with possible routes to Syria, Lebanon, Jordan and Iraq. The study will also look at different financing models whether to implement a traditional build, operate, transfer structure a concession or a hybrid of the two. And a formula will have to be found for sharing the cost between the member states.”

PT Ilthabi Bara secures USD 135 million funds for coalmine development

It is reported that Milbank Tweed Hadley & McCloy has represented Indonesian private coal company PT Ilthabi Bara Utama on a USD 135 million privately arranged equity linked note to finance the development of a coalmine in East Kalimantan.

As per report partner Mr David Zemans and senior associate Mr Jacqueline Chan led the team that negotiated and structured the transaction.

According to Mr Zemans “Going down the privately arranged funding route provided a viable alternative to project financing, which is typically not available for start up companies and takes longer to put in place.”

Merrill Lynch acted as lead arranger on the deal, under advice from Latham & Watkins.

Coal of Ukraine mulling UAH 500 million of bonds

Ukrainian Journal reported that Ukrainian state owned Coal of Ukraine, the operator of Ukraine's wholesale coal market, is mulling the possibility of issuing bonds worth a total of UAH 500 million and attracting Kiev based CJSC Alfa Bank as the issue's lead manager.

The report added that Ukraine's coal industry ministry plans to sign a memorandum on cooperation with Alfa Bank on September 24th 2007. The report was confirmed by the press services of both the ministry and the bank.

New Kransnodonvuhillia to have 1 million tons of coking coal

Krasnodonvuhillia announced that it has commissioned this month a new coalface at the Molodohvardiyska mine with about 1 million tonnes of coking coal. According to Krasnodonvuhillia it spent over UAH 42 million establishing the face for exploitation.