Foundation stone laid for SAIL’s steel processing unit in Bihar

It is reported that Mr Ram Vilas Paswan union minister for steel laid the foundation stone of Bihar’s first steel processing unit on the outskirts of West Champaran district headquarters of Bettiah in Bihar. To be set up by the Steel Authority of India Limited in an area of 50 acres allocated by the state government, the plant will be one of SAIL’s 10 such units located across seven states with the total investment of INR 2000 crore to cater regional needs.

Mr Paswan termed it as a very important step in the process of industrialization of Bihar and informed that another steel processing facility is scheduled to come at Mahnar in Vaishali district soon.

Mr SK Roongta chairman of SAIL said with the setting up of the steel plant many other allied industries would come up in the area.

Mr VK Srivastava MD of SAIL’s Bokaro Steel Plant Giving said that it would be developed in two phases. The first phase will have a gestation period of one and a half years with production capacity of 90,000 tonnes per annum.

ArcelorMittal to set up an industrial training facility in Orissa

ArcelorMittal has announced its intention to set up an industrial training institute at Orissa's Keonjhar district to provide technical training and education to local youth, as it prepares to locate a 12 million tonnes per annum Greenfield steel plants in the state.

A delegation of ArcelorMittal met Mr Naveen Patnaik chief minister for the purpose. During discussion with chief minister, the delegates assured that the Orissa project would be world class with use of state of the art technology in steel making. They also assured to take measures for environment protection in the locality.

An official at the chief minister office said that "The Arcelor Mittal Group has informed the state government that it would soon establish an ITI at Keonjhar and take steps to launch mobile health service in the tribal dominated district."

13 interested in JV with SAIL for cement plant at RSP

It is reported that 13 cement companies, including 2 foreign firms, have evinced interest in entering into a JV with Steel Authority of India for a slag cement plant at Rourkela in response to SAIL’s memorandum seeking EoIs.

Based on evaluation of the expressions of interest, SAIL will shortlist the parties to participate in the subsequent bidding process. Interested parties short listed by SAIL will be provided with the detailed request for proposal after signing confidentiality agreement, which would make them eligible for due diligence.

A source said that the partner for the project is likely to be selected by February 2008 and a consultant would now be appointed for the process.

The source added that the strategic partner once selected would have management and control 74% equity. The capacity of the proposed plant would be around 2 million tonnes and would be a split location project with the clinker plant at Purnapani.

The move to set up a slag cement plant is the 3rd such initiative by SAIL. A JV called Bhilai Jaypee Cement was set up in April 2007, which is setting up a cement plant of 2.2 million tonnes with split location at Bhilai and Satna using 1 million tonne of Bhilai slag and limestone from Satna. At Bokaro, SAIL is at an advanced stage of creating another JV company.

GoM in favor of auction of iron ore mines in new mineral policy

It is reported that the group of ministers on the mineral policy has decided to go ahead with the auction of iron ore mines, overriding the objections of some states. The proposal will have to be passed by the union cabinet.

Officials said that the problem for the union government was that the mineral rich states were being run by opposition governments. The chief ministers of these states of Orissa, Chattisgarh, Rajasthan and Karnataka are arguing against auctions as this mean bidders will opt for states that are better endowed with infrastructure and a ready market. However, the officials said that the centre favored a bidding process to ensure transparency. There are apprehensions about states getting robbed off their mineral riches merely on the basis of commitments.

They added that “The cabinet will have to take a view whether to go ahead with the group of ministers recommendations or to look afresh at the objections raised by chief ministers. Most of these chief ministers are from non congress ruled states and a decision bluntly against them could be turned into a political issue.”

It is noted that mineral rich states had opposed auctions and sought a reconsideration of the norm from the ministers. They wanted allocations on the basis of commitments by steel makers to invest within their boundaries. The mineral rich but backward states said that commitments by steel units of facilities within their boundaries were the only way to ensure their development. New industry and more jobs not only enrich a state but also generate political capital for the incumbent government.

Chattisgarh villagers protest against TATA steel plant

NDTV reported that the farmers in the tribal Bastar area in Chattisgarh are fighting to hold on to their land, saying that the government is forcibly evicting them to make way for the 10,000 crore steel plant to be built by the TATAs in the area.

The report cited a protestor as saying that ''They are threatening us. People are opposing the TATAs. We are not afraid. We will stay here and die here.''

Mr GS Mishra district collector of Bastar said that ''They are trying to create unrest and a law and order problem. Is it possible that the administration could threaten and force the people to accept compensation towards land acquisition.''

A local police source said that ''They were about 300 in numbers, carrying lathis. They spoke against the TATAs and accused us of disbursing compensation to the project affected people. They asked us why we were patrolling during night.''

The TATAs will need more than 4,000 acres of land in 10 villages in Bastar for its steel's plant. With the protests getting stronger, the Chhattisgarh government has been able to only acquire only a fourth of that so far.

Indian aluminum makers to raise 4 fold output by 2012

It is reported that Indian aluminum industry is set to pump in more than INR 100,000 crore in the sector to raise capacity by 4 times in the next 5 to 6 years. Currently, aluminum production is around 1.1 million tonne and the target is raised to around 4 million tonne by 2012.

To increase India’s per capita consumption, the Aluminum Association of India is on course to prepare a national aluminum policy in association with the Union ministry of mines. The policy is expected to be drafted on the lines of the national steel policy and will aim to promote the various uses of the non corroding and strong metal. The idea is to enhance its use in wagons, coaches, power cables and consumer useable like cans.

Mr Shashi Maudgal executive president of Hindalco, at a press conference to announce the fifth international conference and exhibition on aluminum, said that “The world’s per capita consumption of aluminum stands at 25 kilogram as compared to India’s low of 1.3 kilogram. China also consumes 11 kilogram per capita of aluminum annually. AAI is hence promoting the use of the metal and its alloys in more products.”

Mr Maudgal said that the aluminum industry is growing at 18% per annum and to capitalize on the country’s resources, the industry is planning an international aluminum convention this month. Aluminum is the key metal used in air crafts and if technology is applied for the production of parts, it is possible to have Airbus and Boeing assembly line in India in the future.

India’s bauxite reserves are the 3rd largest in the world. Currently, India’s production stands at 1.1 million tonne. With huge investments flowing in, capacity is expected to go up to 3.5 to 4 million tonne per annum by 2012. According to McKinsey, India will consume about 2.5 million tonne of aluminum by 2015.

Bihar CM urges steel minister to set up steel plant in Bihar

Mr Nitish Kumar chief minister of Bihar has urged Mr Ram Vilas Paswan union steel minister to set up a steel plant on the pattern of Bokaro in the state for which he promised to provide 1,000 acres of land.

Mr Nitish Kumar said that "Investments have begun to pour in Bihar and an environment conducive to industrial growth has been created. I would urge Mr Paswan to take initiative to set up a large steel plant on the pattern of Bokaro."

Vedanta Resources H1 revenue up by 29% YoY

Vedanta Resources has posted revenue of USD 3.9 billion for April to September 2007 period up by 29% YoY. It has also posted EBITDA of USD 1.4 billion up by 6% YoY on the back of strong volume growth, acquisition of Sesa Goa and operating efficiencies offset by the appreciating Indian rupee. It’s operating profit during April to September 2007 period was USD 1.2 billion up by 5% YoY.

The financial performance during the period is as under:

In USD million, except as stated

Mr Anil Agarwal chairman of Vedanta Resources Plc sad that "Our primary focus over the past few years has been to deliver significant value to the shareholders and at the same time to build an organization, which is unparalleled in terms of quality, scale and diversity. We believe that our organic growth pipeline, which is unique in the industry, is well positioned to take advantage of major developing economies in India and China."

US contributes USD 1 million to help India develop cleaner coal

A US State Department official release said that it has awarded over USD 1 million to a team of researchers who would help India develop advanced technologies to clean coal, which would enhance energy production and reduce carbon dioxide emissions. The assistance is conferred upon by the to a project team consisting of researchers from 3 leading institutes of Virginia Tech, Indian School of Mines and the University of Kentucky.

Mr Yoon, an internationally recognized expert in coal processing, is principal investigator for the project. Co principal investigators at each of the 3 participating universities will assist him. They are Dr Sumantra Bhattacharya, associate professor of electronics and instrumentation engineering at Indian School of Mines University, Dr Rick Honaker, chair of the mining engineering department at the University of Kentucky and Dr GH Luttrell Massey professor of mining and minerals engineering at Virginia Technology.

The project will promote rapid deployment of the dry beneficiation processes in India. In phase 1, a pilot scale deshaling unit with a maximum capacity of five tonnes per hour will be constructed and installed at different mine sites and or power plants. In phase 2, a detailed flow sheet and engineering diagrams will be developed to construct a full scale proof of concept plant in India. The release added that one of such processes had already been tested successfully in the US at pilot scale under the sponsorship of the US Department of Energy and a new method of dry cleaning finer coal will be explored in the India project.

Upon completion of the plant, a detailed test program will be developed and carried out to fully define the operational capabilities of this technology and to establish design protocols for future installations in India.

Mr Roe Hoan Yoon of centre for advanced separation technology at Virginia Technology said that "It has been shown that use of beneficiated cleaned coals can increase thermal efficiencies and can thereby reduce CO2 emissions by up to 15%. By using state of the art technologies relating to coal quality, boiler and generator design, instrumentation and control, high voltage distribution system, India could reduce CO2 emissions to 45% of its present level."

Mr Yoon said that "The successful completion of phase 2 will constitute a fully operational and commercially viable installation of the proposed technology in India. This large scale test work in phase 2 eliminates risks associated with scale-up and allows a proof of concept plant to serve as a model for future installations in India and abroad."

Dr Sumantra Bhattacharya professor of Indian School of Mines said that "In 2005-2006, India produced 380 million tonnes of coal, but only 17 million tonnes were beneficiated coals delivered to 12 power stations since it was difficult and costly to remove ash forming minerals from the Indian coal." He added that the researchers will have to develop low cost dry beneficiation technologies that can remove well liberated, easy to reject rocks or shales.

Hindalco approves merges with Indian Aluminum Company

It is reported that the shareholders of Hindalco Industries at their court convened meeting held on November 12th 2007 has approved the amalgamation of Indian Aluminum Company with it by requisite majority.

Hindalco Industries, a flagship company of the Aditya Birla group, is structured into 2 strategic businesses aluminum and copper. Its product range includes alumina chemicals, primary aluminum ingots, billets, wire rods, rolled products, extrusions, foils and alloy wheels. It enjoys a domestic market share of 42% in primary aluminum, 63% in rolled products, 20% in extrusions, 44% in foils and 31% in wheels.

NTPC named world's 3rd biggest polluting entity

China and India, the world's two fastest growing economies, have earned the dubious distinction of being home to some of the biggest polluting firms across the globe, with Indian power producer Nation Thermal Power Corporation occupying the 3rd position worldwide in terms of carbon dioxide emission.

According to a list by US based database Carbon Monitoring for Action, within India, 17 of the 20 biggest polluters happen to be public sector enterprises, including NTPC. The 3 private sector firms among India's 20 biggest emitters of carbon dioxide include RPG Group's CESC Limited, Aditya Birla group's Hindalco Industries and Anil Ambani group's Reliance Energy at 16th, 18th and 20th positions respectively.

Worldwide, China's Huaneng Power International has been ranked the largest polluter, with South Africa's Eskom placed 2nd. China Huadian Group and China Power Investment Corp ended up as the 4th and 5th largest polluters in the global list.

CARMA is financed by Confronting Climate Change Initiative of Washington based independent think tank Center for Global Development. The study compiled data on all firms involved in power generation for commercial or captive use. The companies were ranked on the basis of factors including carbon emissions, energy generated, intensity, and usage of fossil, hydro, nuclear and other renewable sources.

In terms of total carbon emission in a country, the US was named as the most polluting nation with 2,790 million tons of emissions, followed by China and Russia at the 2nd and 3rd positions. India was ranked at the 4th spot with 583 million tonnes, while Japan occupied the 5th rank with 400 million tonnes.

NHPC halts work on Parbati hydroelectric power project in HP

It is reported that work on National Hydro Power Corporation's Parbati hydroelectric project stage II and stage III has come to a halt due to the Himachal Pradesh High Court's directions barring all mega commercial projects in Kullu district from using sand and gravel procured from the district.

NHPC officials said that the crushers and batching plants of the projects had been closed down because of the court's directive, making it impossible for them to go ahead with the work.

The high court has, however, relaxed its order in favour of NHPC with the rider that the operation being carried out by NHPC will be subject to the overall supervision by the monitoring committee and submission of its report.

NHPC informed the ministry that it is contemplating approaching the HP high court for relaxation of its order so that crushers could resume and construction work at the project site may progress. The central utility has also requested the power ministry to intervene in the matter.

Suzlon Energy subsidiary gets 2 major orders in Australia

Suzlon Energy Limited has announced that its wholly owned subsidiary in Australia had received 2 major orders for more than 200 MW of capacity.

The details of the project are as under:

1) It has won a contract from Sydney's Renewable Power Ventures for 63 units of wind turbines with 132 MW capacity. The scheduled for completion is H1 of 2009.

2) It has won a contract from utility major AGL Energy for 34 units of wind turbines and is scheduled for completion by 2009.

Orissa detects illegal iron ore transportation by trains

SNS reported that illegal transportation of iron ore by trucks in Joda and Barbil areas in Orissa seems to have become outdated and now has given way to trains in this flourishing business.

A team led by the deputy director of mines of Joda detained a goods train carrying iron ore from Barbil to Kolkata. Primary investigation revealed that 800 tonne of ores were being transported to a Kolkata based company.

The local mine owners said that the recent case is not surprising and everyday iron and manganese ores are reportedly being transported to various destinations by trains.

JCB India opens new excavator plant in Talegaon

It is reported that construction equipment manufacturer JCB India Limited, a subsidiary of UK based JCB Excavators, has inaugurated a new plant for heavy line excavators, adjacent to its existing facility for manufacture of components at Talegaon in Maharashtra. The new plant, which has an installed capacity of 2,000 units per year, will cater to both domestic as well as for the export markets.

Mr Jon Patterson MD & CEO of JC Bamford Excavators Limited said that “India is a global manufacturing nation and will be a hub for Africa, Singapore, Malaysia and Indonesia in South East Asia. We will concentrate on excavators, loading shovels and compact rollers.” He added that India is now the single largest JCB business anywhere in the world.

JCB India has also sought an additional 100 acres of land in the region for its growth plans. It has invested INR 330 crore at its 2 facilities in Pune and is also investing INR 150 crore in upgrading its third plant at Ballabhgarh in Haryana and doubling manufacturing capacity from around 12,000 units to 25,000 units. Last year, JCB India produced 10,800 machines of the 55,000 manufactured globally and exported 50% machines and 65% of its component production.

Kulpi Port deal with Dubai World to be sealed by January 2008

It is reported that West Bengal government is likely to finalize the agreement with Dubai Port for its all weather port at Kulpi by January 2008. The project will also require an approval from the Kolkata Port Trust.

Stakeholders in the project are DP World, Keventer Group and the West Bengal Industrial Development Corporation.

Kulpi port to be spread over 700 acre of land, will include all weather port facilities, a ship breaking yard and an industrial park. It will also have a marine terminal with a 450 meter quay.

Coal shortage may force closure of Ropar power plant in Punjab

It is reported that the derailment of 13 wagons of a goods train on Sonepat to Panipat section has set the alarm bells ringing among the Punjab State Electricity Board authorities as the coal stock at Ropar thermal plant is just sufficient for one day. The retrievable coal stock at Ropar thermal plant is approximately 28000 tonnes and the daily coal consumption is more than 20000 tonnes.

The official sources informed that in case of delay in receipt of coal due to derailment 1 or 2 units of plants may be closed down. The coal rakes for Ropar Thermal Plant are normally received through Delhi to Ambala section

There are approximately 900000 tonnes of coal exists in the accident but the official sources said that this coal can not be retrieved. The total cost of this coal is around INR 18 crores.

A senior officer said that the plant authorities had been recording less coal consumption in previous years for showing the better plant efficiency. The Ropar thermal plant has received 73 coal racks in the month of November 2007 where as the coal consumption for the month is around 102 racks.

As per Central Electricity Authority norms every thermal plant is supposed to keep a minimum balance of coal stock sufficient to run the plant for 21 days.

Union power ministry to increase power allocation to NE

It is reported that union power ministry is looking into the option of increasing the allocation of power to the north eastern states from ONGC's Tripura Power Corporation's upcoming 740 MW gas based power project at Pallatana in Tripura.

Mr Anil Razdan union power secretary stated that presently 200 MW power was proposed to be allocated to north east and the balance 540 MW to the northern region states. However, due to new demand from the states and associated transmission constraints, the allocation is to be re looked.

Razdan announced that maximum power from the project should be given to the states due to shortage of power. He said that the ministry wants north east region to get maximum benefit from this project. Mizoram, Tripura, Meghalaya and Assam could be the main beneficiaries.

The CEA informed that about 450 MW power could be absorbed by the region. It further informed that the Assam had requested for 400 MW power from this project, but the actual requirement could be 250 to 300 MW. Tripura had requested for 119 MW and Meghalaya may take around 100 MW.

Gerdau to acquire Quanex steel unit for USD 1.67 Billion

Latin America's largest steelmaker Gerdau SA has agreed to acquire Quanex Corp's Vehicular Products business, including its MACSTEEL division, for USD 1.67 billion. Gerdau will pay USD 39.20 a share in cash. Houston based Quanex and Porto Alegre, Brazil based Gerdau said in separate statements. Quanex has entered into a definitive agreement with Gerdau with respect to the merger.

The merger of Quanex by Gerdau S.A. remains subject to approval by Quanex shareholders, clearance under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, the Exon-Florio Provision and other customary closing conditions. The transactions are expected to be completed by the end of the first quarter of calendar 2008.

The deal does not include Quanex's building products unit, which will be spun off as a standalone company. Quanex shareholders will also receive one share in the spun off building products company for each share they hold.

The Quanex vehicular unit operates mini mills in Jackson and Monroe, Michigan and Fort Smith, Arkansas. The company also has six steel processing mills in Michigan, Ohio, Indiana and Wisconsin, Gerdau said. Quanex produces 1.2 million tonnes of raw steel a year and 1.1 million tonnes of rolled products.

Mr Andre Gerdau Johannpeter CEO of Gerdau said that “It is expanding operations in the Americas, Asia and Europe to reduce costs and gain leverage with suppliers of scrap metal and energy.”

Gerdau acquired Texas based Chaparrel Steel Co in July 2007 for USD 4.22 billion and agreed to buy a 49% stake in the owner of Mexico's Aceros Corsa SA in October.

BHPB bid for Rio - IISI calls for strict review

The International Iron and Steel Institute yesterday has issued a formal request that all relevant competition authorities review the proposed alliance between BHP and Rio Tinto.

Mr Ian Christmas Secretary General speaking on behalf of steel producers worldwide said that “IISI supports free and fair trade in steel. Competition between steel companies promotes innovation and efficiency. It promotes the growth in steel use and serves steel’s customers and society as a whole. IISI has also supported the consolidation of steel businesses but not to the extent of creating a monopoly. Even the largest steel company in the world today accounts for less than 15% of total world steel production. In sharp contrast the business of seaborne iron ore is dominated by just three companies. CVRD, Rio Tinto and BHP Billiton account for over 70% of total world trade.”

Mr Ian Christmas added that “Any further consolidation between the big three would create a virtual monopoly in the business. For this reason, not only will the steel industry strongly oppose the potential merger of BHP Billiton and Rio Tinto, but it is vital that the competition authorities in the EU, USA, China, Australia and Japan also recognize the threat that this merger poses to the interests of steel consumers and the general public. This merger is not in the public interest and should not be allowed to proceed.”

The International Iron and Steel Institute is one of the largest and most dynamic industry associations in the world. IISI represents approximately 180 steel producers including 19 of the world's 20 largest steel companies, national and regional steel industry associations and steel research institutes. IISI members produce around 75% of the world's steel excluding China and the growing membership in China now accounts for over 20% of Chinese production.

ArcelorMittal sees cost pressures pushing steel prices higher in 2008

ArcelorMittal announced a price increases for flat steel products in NAFTA and European markets as a direct consequence of raw material and energy cost increases in 2008.

The release added that “Demand for steel products remains firm and there exists ongoing strength in the macroeconomic environment in the BRIC countries, emerging Asia, Middle East and CIS regions. Coupled with slower but positive growth in Europe and a pick up in apparent steel demand in NAFTA overall global steel demand growth of around 6% is expected in 2008.”

With regards to the US market, having successfully achieved an average USD 20 per tonnes price increase for strip mill products in Q4 07, ArcelorMittal earlier announced a further increase of USD 40 per tonnes for deliveries as of January 1st 2008. On top of rising raw material prices, current US prices are below prevailing global market levels. Going forward, low inventories, falling steel imports and relatively robust demand for high quality steels should underpin a realignment of US prices toward global market levels.

In the EU, ArcelorMittal is to maintain 2007 prices during Q1 2008 and apply price increases from Q2 reflecting raw material cost increases. After two years of exceptional demand, developments in the European steel market continue to be positive despite the expected slowdown in economic growth. However, ArcelorMittal recognises that the current Euro/USD exchange rates are affecting the competitiveness of our industrial customers. The present slowdown of imports will help to readjust inventories to adequate levels and create strong demand after the winter season.

Mr Christophe Cornier CEO of Flat Carbon Europe said that " We are convinced that strong demand in China and very expensive freight rates will help to rebalance the European inventory situation within short term and create an excellent basis for further positive developments during the year 2008. Our price policy reflects ArcelorMittal's commitment to stability and fair play with our customers. We are dedicated to raising the levels of service offered to customers.”

Ferrowest inks pig iron supply MOU with Dongbu Steel

Ferrowest Ltd announced that it has executed a memorandum of understanding with Dongbu Steel Co Ltd. Under the terms of the MOU, Dongbu and Ferrowest will consider the long term supply of pig iron to Dongbu and Dongbu will consider investment and other support to assist in advancing the Yalgoo project.

Dongbu is seeking a long term supply of 250,000 tonnes per annum of merchant pig iron as feedstock for a new 2.8 million tonnes per annum electric arc steel plant that is under construction adjacent to Dongbu's existing Asansteel works.

The 250,000 tonnes per annum is 50% of the proposed initial annual production from Ferrowest’s Yalgoo Iron Project.

Midwest rejects Murchison bid

It is reported that Australian Midwest Corporation backed by China’s Sinosteel has formally rejected a hostile takeover bid from Murchison Metals, saying the AUD 1 billion offer undervalued its potential. Australia listed Murchison is backed by Mitsubishi Corp of Japan and the takeover battle underlines the strategic rivalry between Japan and China to secure supplies of Australian iron ore.

Midwest said its directors unanimously rejected the offer of one Murchison share for each 1.08 Midwest share. Mr Bryan Oliver CEO of Midwest said the offer was opportunistic and significantly undervalued Midwest’s relative contribution to an enlarged group.

Midwest said that “The offer fails to recognize Midwest’s potential as a stand alone iron ore explorer and producer in Western Australia. Adding shareholders representing 45% of its issued capital have indicated they will reject the offer.”

Mr Oliver said that based on independent findings, Midwest would contribute 63% of the combined group’s mineral resources but only 31% of the enlarged group’s share capital.

Murchison rejected the claims made by Midwest relating to its resource potential. It said the independent report had limited scope and was based on incomplete information. It said that Murchison’s offer is aimed in part at resolving a long running dispute over the development of a potentially important new iron ore province in Western Australia.

The two Australian miners have come up with competing proposals for building the AUD 3 billion in infrastructure needed to support mining in the mid west region, principally a 300 kilometer rail link and a new port north of Perth. In spite of pressure from the state government and others, they have not reached a compromise and talks aimed at a friendly merger have also failed.

BHPB bid for Rio – JISF slams the move

Japan Iron and Steel Federation has come out in open against BHPB’s move to merge with Rio Tinto. Japan is one of the world's largest consumer of raw materials, but the resource poor country relies almost entirely on imports.

Mr Hajime Bada chairman of the Japan Iron and Steel Federation told a news conference that a melding of two of the largest raw materials suppliers, BHP Billiton PLC and Rio Tinto PLC, is undesirable for industrial competition and pricing.

The report quoted a JISF spokesperson citing Mr Bada as saying that “We are afraid that a healthy pricing mechanism would be lost under their market dominance through a merger.”

After a takeover, 60% of Japan's raw materials imports would have to come from the two companies, the spokesman said. He said “This would be a major setback for the Japanese industry.”

Mr Bada said he would convey the message when he holds talks as president of JFE Steel Corp with Mr Marius Kloppers CEO of BHP Billiton , currently in Japan to meet with industry leaders and clients. Mr. Kloppers is also scheduled to visit business leaders and clients in China and South Korea before returning to Australia.

Japan Iron and Steel Federation is comprised of 61 manufacturers, 60 trading companies and six industry groups.

Murray to sells specialist metals arm Apollo to ThyssenKrupp Services

It is reported that Murray International Holdings, the business conglomerate run by Rangers chairman Sir David Murray, is to sell its subsidiary Apollo Metals to Dusseldorf based ThyssenKrupp Services for an undisclosed sum.

Apollo provides high grade products such as aluminum, stainless steel and non ferrous metals for aerospace manufacturers and their supply chains.

The sale will combine Apollo's predominantly European and Far Eastern businesses with ThyssenKrupp Services' US based operations to form a global enterprise comprising 30 locations in 13 countries.

Mr Graeme Hill CEO of the Murray Metals Group division said that the sale would offer a fair return for all stakeholders and enable further expansion of various businesses and markets.

MMG is a leader in steel and metals stockholding, processing, profiling and distribution. Its businesses include Multi Metals, Premier Alloys, Forth Steel, Northern Steel Stocks, Austin Trumanns Steel, Ireland Alloys, Tipton & Mill, Newton Steel Stock and its most recent acquisition, Parson and Crosland.

Stupp Bros to set up a large dia pipe mill

St Louis Business Journal reported that Stupp Bros, a holding company for several businesses, has a new manufacturing facility in its development pipeline. It's Stupp Corp division plans to build a USD 60 million steel pipe making mill on its pipe manufacturing campus in Baton Rouge.

The new facility, which is expected to be completed in early 2009, will make products of a larger diameter than the company can currently produce. With the new, 220,000 square foot mill, it will be able to produce pipe up to 60 inches in diameter. It currently makes products up to 24 inches in diameter. Stupp's pipe products are used in building pipelines for the natural gas and oil industries.

Mr John Stupp Jr president of Stupp Bros said "There's currently a boom of larger piping projects being built around the country and it has to be imported from countries like India, Italy, Turkey and Greece. With this new facility, we should be able to make a competitive product for clients, with a lot fewer logistical challenges."

John Wood Group acquires IMV Corp

It is reported that a subsidiary of John Wood Group PLC has agreed to acquire IMV Corp for an initial cash consideration of USD 140 million. The acquisition is expected to be completed by the end of November 2007.

IMV, owned by its management and employees, provides engineering, procurement and construction management services to the Canadian oil and gas exploration and production sector.

There will be three further cash payments due in the period to 2014 based on the future performance of IMV. It is expected the acquisition will be earnings enhancing from 2008 onwards.

BHPB appoints Mr Mackenzie as CEO of Non ferrous

BHP Billiton announced that it has appointed Mr Andrew Mackenzie as Group Executive and Chief Executive Non Ferrous. Mr Mackenzie will be a member of the Group Management Committee. Mr Mackenzie will assume the role following the succession of Marius Kloppers from the position of Group President Non Ferrous to Chief Executive Officer on October 1st 2007.

Mr Mackenzie has around 30 years working experience in minerals, metals, oil and gas. He joins BHP Billiton from Rio Tinto, where he was Chief Executive, Diamonds and Industrial Minerals. Previously he was Group Vice President, BP Petrochemicals. He spent 22 years with BP, primarily in the UK and North America in senior positions including head of Capital Markets in BP Finance, chief reservoir engineer with oversight of oil and gas reserves and production, head of Government and Public Affairs worldwide and Group Vice-President Technology. Mr Mackenzie is a non-executive director of Centrica.

Mr Marius Kloppers CEO of BHPB welcomed Mr Mackenzie to the Group Management Committee. “Andrew has extensive experience in our sector and will be a valuable addition to our executive team. I look forward to working with him as we strive to meet the growing demand for our commodities,” Mr Kloppers said.

Mr Mackenzie will be based in London. No start date has yet been fixed. His employment contract with Rio Tinto contains obligations in relation to a period of notice that he will observe.

Alabama to form Steel Council

Alabama Governor Bob Riley said that he is forming the Alabama Steel Council to help one of the state's oldest manufacturing industries. Mr Riley's announcement came during a ceremony marking the 100th anniversary of US Steel's Fairfield Works, which produces coated and rolled steel coils and pipe products for the construction, energy and other markets.

Mr Riley said the council, under the leadership of Alabama Labor Department Commissioner Mr Jim Bennett, is designed to ensure the state is meeting the needs of an old line industry that is being revitalized despite fears a few years back that it wouldn't be able to withstand an avalanche of cheap imports.

The governor said that with the construction of ThyssenKrupp's steel plant near Mobile and contributions from US Steel and other plants, Alabama will soon become the nation's second biggest steel producing state. The metals industry employs nearly 49,000 people across the state.

Mr Riley said the council, open to all state steel producers, will give a boost to Alabama companies by serving as an advocate for its members and acting as a resource for the industry. He added that "Alabama workers have proven they can produce the best products in the world.” Citing the success of the state's auto manufacturing plants. he further added that "If we want to continue to be one of the largest steel producers in the world, Alabama must change the way we do business."

Mr Riley said that the council will meet twice a year the state must do its part to ensure its steel industry doesn't fall into the same trap as Alabama's textile industry plants shut down as jobs moved first to Mexico and then to cheaper settings such as China. He added that "We want the state to do its part to help expand steel production and create jobs in Alabama."

WCI BF to remain idle while repairs are being made

It is reported that the blast furnace at WCI Steel will remain idle for two additional weeks as repairs are made after a fire a week ago. The fire occurred November 9th 2007.

Mr Tim Roberts a spokesman of WCI Steel said that the hot strip mill and finishing areas are continuing to operate by using steel slabs that already had been produced. He added that he couldn't estimate how long the operating parts of the mill would continue to run.

Mr Roberts said about 100 workers are affected by the idling of the furnace, but there have been no layoffs. WCI's labor contract calls for workers with at least three years' service to be paid 40 hours a week. Mr Roberts said no decision has been made regarding layoffs of workers with less than three years' service.

The cause of the fire is still being investigated, but it is believed to have started in two hydraulic rooms on the main deck of the furnace.

Sysco to start galvanume supplies in Taiwanese market

YIEH reported that Taiwan Sysco's new galvanume product has passed assessment tests by Taiwan’s panel industries and now it will start producing small quantities in 2008.

Currently its galvanume product has passed the assay by AUO, Chimei, Hannstar and etc. The validity of the assay will be 18 months long; therefore, Sysco will be the only supplier who can supply the GL product to Taiwan panel mills. Sysco expects the total supply quantity per year will be 1,000 tons in 2007 and to reach 6,000 tons in 2008.

Sysco said that “As to demand of the coating steel has weakened in Taiwan’s domestic market and China Steel has become the competitor since its GI production line has started the processing; it has devoted to develop the high value added steel product.”

Thailand to promote high performance BFs

It is reported that Thailand’s government has launched its new conditions for promoting high quality steel blast furnace investment in Thailand.

It has sets four conditions for steelmakers interested in investing in upstream steel furnaces
1. A project must produce at least two million tonnes of premium grade upstream steel per year.
2. Production must meet the strictest environmental standards.
3. Steelmakers must propose their plan to do research and development with other involved industries, especially automotive and electronics.
4. They must be able to express their corporate social responsibility for communities and administrative bodies in plant locations.

Mr Kosit Panpiemras deputy prime minister and industry minister of Thailand said that steelmakers are interested in investing in premium grade blast furnaces due partly to sufficient demand for upstream steel following new investment in the automotive industry. He added that as most auto makers have established their production plants here, their enhanced R&D cooperation will support steel producers to make products that meet the specifications of demand in the market and also increase their product margins.

Mr Kosit said that “Thailand recorded total imports of 2.5 million tonnes of upstream steel per year. Of that, premium grade steel made up 4.5 million tonnes. It needs to establish furnaces or risk losing competitiveness to countries such as Vietnam.”

Newcastle thermal coal price reaches record for 4th Week

Bloomberg reported that Coal prices at Australia's Newcastle port, a benchmark for supplies in Asia rose to a record for a fourth consecutive week on concerns of supply shortages. According to the globalCOAL NEWC Index, power station coal for delivery within the next 3 months gained by 97 cents, or 1.2% to AUD 84.48 a metric ton in the week ended November 16

Sydney based Mr Gavin Wendt a senior resources analyst at Fat Prophets Funds Management said that “Spot thermal prices have a lot of momentum at the moment and can go higher. Given the high price of crude oil, coal still looks cheap.''

Coal mining companies in Australia's Hunter Valley shipped 7.4 million tons of coal through Newcastle in October, less than the targeted 7.9 million tons, because of maintenance work and cargo-loading constraints, the Hunter Valley Coal Chain Logistics Team said on its Web site Xstrata Plc, Rio Tinto Group and BHP Billiton Ltd are among producers that export through Newcastle.

The logistics team, coordinator of coal transportation through the rail and port network at Newcastle, is targeting November throughput of 7.3 million tons. The logistics team said last week that the queue of ships waiting outside Newcastle port to load coal reached a record 79 in June after storms disrupted operations and hasn't been less than 37 this year. The number of ships in the queue is expected to remain at about 40 through December.

TKC to form iron ore mining JV

It is reported that Philippines listed firm TKC Steel Corp is entering into a JV with a mining company in Zamboanga del Sur and Mikro Tech Inc of port operator Michael Romero. The JV will be engaged in exploring prospective iron ore reserves to support TKC's proposed blast furnace and steel manufacturing projects.

TKC was scheduled to sign a memorandum of agreement for the joint venture Mikro-Tech and Zamboanga based Karanglan Resources and Mining Corp. Under the deal, Mikor Tech and KRMC will assign their rights to mining assets to the joint venture.

TKC for its part will purchase the iron ore output of the JV which would be used for its blast furnace operations. Its blast furnace is seen to double its production of steel billets from 300,000 tonnes to 600,000 tonnes per year by the fourth quarter of 2008.

Steel prices in Vietnam likely to increase next month

The Vietnam Steel Association forecasted that the price of steel will surge in the remaining months of this year as China plans to raise the export tax on steel ingots from 15% to 25% in December. Currently, the price of construction steel from plants is around VND10 to 12 million per tonnes.

Meanwhile, if the export tax on Chinese steel ingots increases by 10% and the Vietnamese import tax remains at 2% as at present, the price of imported steel ingots will surpass USD 650 per tonnes and the price of domestic steel will be more than VND13 million per tonnes. Therefore, the price of steel on the domestic market is expected to rise.

Thailand asks Nippon for setting up a steel plant

Nippon Steel Corp said that it has received a request from Thailand government officials to build a steel plant in the country. The report quoted a Nippon Steel spokesman as saying that it received the request late last week, without elaborating.

Mr Satit Chajanavakul chief of Thailand's Board of Investment declined to name the company Thai officials had contacted but told Dow Jones Newswires that a Japanese steel maker is keen to invest in an upstream steel production plant in Thailand after the Board of Investment recently announced a policy to promote investment in the manufacturing of high quality upstream steel. Mr Satit added that the investment in an upstream steel project usually costs around USD 3 billion.

Nippon Steel told the officials, including Thai Deputy Prime Minister Kosit Punpiemrat that it will look into the possibility of undertaking a study for construction of the proposed steel plant. If the Thai government and Nippon Steel strike a deal, it would be the first major steel plant project abroad for the Japanese company.

The Board of Investment in a statement last week said that to meet the BOI investment criteria, the output of the upstream steel project must not be less than 2 million tons per year. The investment would help support the growth of related industries such as automotive, electronics, petrochemical, machinery and packaging.

According to the Board of Investment, at present, high quality steel isn't produced in Thailand. The country imports 4.5 million tons of premium-graded steel from Japan and Korea annually. Thailand's total annual demand for steel products is about 12.5 million tonnes.

ThyssenKrupp VDM appoints Dr Munasinghe as MD of UK operation

ThyssenKrupp VDM announced that it appointed Dr David Munasinghe as the new managing director of ThyssenKrupp VDM’s UK operation based at Esher in Surrey as of January 2008.

Dr Munasinghe will leave his position at the Austrian based company Plansee to take up his new duties with ThyssenKrupp VDM, where he will be responsible for the whole of the British Isles.

Dr Munasinghe has been with Plansee for 7 years prior to which he served in research, production and the Marketing departments of Special Metals, Hereford. Following a brief hand over period Mr Mike Taylor present Managing Director of ThyssenKrupp VDM will relinquish his responsibilities as of March 2008 after forty years in the nickel industry.

ThyssenKrupp VDM Australia is a subsidiary company of ThyssenKrupp VDM Germany which is a member of the ThyssenKrupp Group, and is the main stockiest in South East Asia and the Far East for the company’s range of nickel based alloys and high performance special metals.

AK Steel's presents Supplier of the Year Awards to 4 vendors

AK Steel announced that it presented "Supplier of the Year" award to four companies for outstanding service, value and strategic support of the steel maker's business plan. The awards were presented by Mr James L Wainscott chairman, president & CEO of AK Steel during the company's fourth annual Key Supplier Meeting held in West Chester.

Companies receiving AK Steel's Supplier of the Year awards are
1. Coyne Textile Services at Syracuse in New York for employee uniform services
2. Glencore Ltd at Stamford in Connecticut for ferrochrome alloys
3. MPW Industrial Services at Hebron in Ohio for mobile equipment operation, grounds and other maintenance services
4. Vesuvius USA at Pittsburgh in Pennsylvania for steelmaking ladle components

Mr Wainscott said that "Our award recipients provided exceptional value to AK Steel this year. Each of them found innovative ways to supply us with quality products and services, delivered at significant cost savings to our company."

During his keynote address at the meeting, Mr Wainscott stressed the importance of the steelmaker and its suppliers working together to help maintain the momentum of AK Steel's growth.

AK Steel produces flat-rolled carbon, stainless and electrical steel products, as well as carbon and stainless tubular steel products, for automotive, appliance, construction and manufacturing markets.

Japan major electric furnaces post lower profit in H1

JMB reported that Japanese major 14 electric furnace steel makers out of 15 firms posted lower recurring profit for half year to September compared with same period of 2006. They reduced the profit despite of the higher selling price when ferrous scrap cost increased by around JPY 10,000 per tonne.

The release added that Yamato Kogyo posted record profit due to strong result of North American operation. The major 14 makers lower profit for the full year to March 2008 while Yamato Kogyo expects higher profit.

National Coal Corp Q3 revenue down by 2.7% YoY

National Coal announced that it posted a Q3 of 2007 net loss of USD 7.8 million as compared to a loss of USD 3.7 million in Q3 of 2006. Its quarterly revenues declined by 2.7% YoY to USD 20.9 million from USD 21.4 million in the Q3 of 2006.

National Coal also reported nine month net loss of USD 21.7 million as compared to a loss of USD 16.6 million in the year ago period. Total revenues for the period decreased to USD 58.8 million from USD 66.0 million in the prior year period.

Highlights for Q3 of 2007 results:

1. Revenues for third quarter 2007 totaled approximately USD 20.9 million, down by 2.7% YoY from USD 21.4 million earned in the Q3 of 2006, but up 10.5% YoY from USD 18.9 million realized in the second quarter 2007.

2. Tons of coal sold totaled approximately 405,685 tons, down by 0.9% from 409,215 tons sold in the Q3 of 2006, but up by 9.0% YoY from 372,341 tons sold in the Q2 of 2007.

3. Cost of sales increased by 27.7% QoQ during the Q3 of 2007, when compared to the Q2 of 2007.

4. New Kentucky mine opened during quarter should add approximately 240,000 tons per year of production and return idle equipment to productive use.

5. At start of fourth quarter, completed acquisition of Mann Steel Products for USD 55 million, adding approximately 1 million tons of production and sales.

6. Signed new contract for 240,000 tons per year for 2008 and 2009 with major customer.

7. Pine Mountain, an idle asset, was sold during November for USD 2.0 million.

Mr Daniel A Roling president & CEO of National Coal said that "These results are below expectations; however, it is important to remember that it is not unusual for an emergent company to experience fluctuations throughout its growth process. The third quarter presented challenges over the prior-year period including weaker pricing and demand. In addition to the continued tough market conditions, the Company experienced challenging operating conditions which resulted in the temporary loss of service of a highwall miner cutter head, tough geological conditions resulting in the loss of mine-able coal for a portion of the quarter, and increased costs directly related to the higher price of petroleum products. Moving forward, I expect that the Company will be in a better position to capitalize on the improving supply and demand fundamentals as well as the strengthening pricing environment."

National Coal Corp, through its wholly owned subsidiary, National Coal Corporation, is engaged in coal mining in East Tennessee and Southeastern Kentucky and through its wholly owned subsidiary, National Coal of Alabama, is engaged in coal mining in Alabama. Currently, National Coal employs about 350 people. National Coal sells steam coal to electric utilities and industrial companies in the Southeastern United States.

USD 1.2 billion invested during the H1 of 2007 in new ships

It is reported that in the H1 of 2007, a cumulative total of USD 1.2 billion has been invested in new ships, 114 of which are 10,000 TEU or above capacity vessels.

According to French shipping consultancy firm Alphaliner, from the Q3 of 2007 to 2011, the number of 10,000 TEU ships will exceed 150. These ships will be mainly deployed on Far East to Europe routes since volume on these routes is expected to grow.

The world trade, it is estimated, will grow by 6.7% to 7.4% over five years entailing in a cargo volume growth of 10% to 11%. China’s economic boom will continue to drive growth in container market. In 2006, the container throughput in all Chinese ports reached 80 million TEUs or one fifth of the global volume.

From Asia to Europe and North America, China’s exports accounted for more than half of the market volumes. Barring unforeseen developments, it is therefore felt that the container market looks set to flourish in the coming years.

MHI receives major power plant order from Electrica Guacolda

Mitsubishi Heavy Industries, Ltd announced that it has received a full turnkey order from Empresa Electrica Guacolda SA, an electricity provider in Chile, for a 152 MW coal fired power generation plant to be built at the Guacolda Power Station in Huasco.

The power plant on order to be built in Huasco, approximately 700 kilometers north of Santiago in Chile's capital will consist of a boiler, steam turbine, generator and steam condenser. MHI will manufacture the boiler at its Yokohama Dockyard and Machinery Works, which is also responsible for the plant construction work, and the steam turbine and steam condenser at its Nagasaki Shipyard and Machinery Works. Mitsubishi Electric Corporation will supply the generator and Mitsubishi Corporation will handle the trade particulars.

Electrica Guacolda headquartered in Santiago, is a mid sized electricity provider in Chile that conducts power generation and transmission. The Guacolda Power Station is advantageously located in Huasco in the proximity of customers and supply 55% of electricity needed in Norte Chico area. The high evaluation accorded by Electrica Guacolda to MHI's technological expertise and the proven operational record of its previously delivered power plants resulted in the award of the latest order.

Mitsubishi Heavy Industries, Ltd is one of the world's leading heavy machinery manufacturers, with consolidated sales of JPY 3,068 billion in fiscal 2006. MHI's diverse lineup of products and services encompasses shipbuilding, power plants, chemical plants, environmental equipment, steel structures, industrial and general machinery, aircraft, space rocketry and air conditioning systems.

Emirate International setting up wire factory in Abu Dhabi

Emirates International Investment Company is setting up an AED 250 million magnet wire factory in Abu Dhabi to expand its business.

The new factory will be built on a 25,000 square meters area and is estimated to produce 25,000 tonnes of copper per annum during phase one and the total production will be increased in subsequent phases.

The new factory will produce three types of magnet wire, round wires insulated with varnish and flat wires insulated with either varnish or paper, in sizes ranging from 0.5mm up to 4.5mm. At the request of customers, this range may include round and flat aluminum wires.

This project is part of a plan initiated by EIIC to fulfill the growing demand for the many types of electrical power cables and wires used both locally and globally.

Emaar plans London listing in 2008

ArabianBusiness.com reported that real estate giant Emaar is planning to float on the London Stock Exchange next year, which could value the company at USD 40 billion.

Mr Mohammed Alabbar chairman of Emmar during an exclusive interview with Arabian Business, confirmed that "Emaar is considering listing on the London Stock Exchange and the estimated timeline is the next twelve months."

The magazine cites sources close to the company speculating that the listing will be in the form of a mother company, covering the entire Emaar empire, which include its Dubai Financial Market listing, its India listing and its 30% stake in Saudi Arabia's Economic City. With the Dubai Financial Market listing worth USD 21 billion, India USD 17 billion, any London listing is on today's figures likely to top the USD 40 billion mark.

UAE plans new law on foreign ownership of companies

MEED reported that government of Abu Dhabi would soon decide its policy on the 100% ownership of businesses in the specialized economic zones being established in the emirate.

Mr Jaber Al Khaili CEO of Zonescorp, on the sidelines of Abu Dhabi Conference 2007, said that "The government is working on a policy to be announced in near future, as it is under consideration by the federal as well as authorities in the emirate of Abu Dhabi."

Pakistan proposes changes in agreements with power companies

Pakistan Daily Times reported that the government has proposed changes in the standardized agreements for power sector to mitigate the risk of change in law and afford protection to the foreign lenders and project companies.

A senior official at Pakistan’s ministry of water & power said that government of Pakistan will indemnify full compensation of losses to the project company and its lenders against changes in law in Pakistan affecting the legality or enforceability of implementation agreement, power purchase agreement or Government of Pakistan Guarantee. The government would give a choice to the lenders to invoke law of Pakistan and England with respect to resolve disputes arising out of direct agreements like implementation agreements and power purchase agreements.

He added that Government of Pakistan Guarantee shall continue to be governed by law of Pakistan and courts of competent jurisdiction including courts of England, shall adjudicate disputes arising between Government of Pakistan and project company under the Government of Pakistan Guarantee.

The water & power ministry has proposed to the government that a choice may be given to the lenders between laws of Pakistan and England with respect to direct agreements like implementation agreement and power purchase agreements, which may contain an indemnity to the effect that in case the implementation agreement and power purchase agreements or the Government of Pakistan Guarantee becomes unenforceable, illegal or invalid due to change in law.

The official explained that the implementation agreement, power purchase agreement and Government of Pakistan Guarantee shall continue to be governed by the laws of Pakistan. The ministry in response to governing law for direct agreements and Sovereign Guarantee under the 2002 Policy for Power Generation has submitted these proposals for approval and enforcement.

Oman to employ cutting edge technologies to boost petroleum output

Officials of Oman's top exploration and production company Petroleum Development Oman said that it is determined to employ cutting edge technologies to augment its oil and gas production. Petroleum Development Oman, which accounts for more than 80% of Oman's crude oil production and nearly all of its natural gas supply, also underlined that technology had dramatically changed the way the company did business.

Mr John Malcolm MD of Petroleum Development Oman, while speaking at a ceremony to mark the opening of its “Technology Day and Exhibition” said that "Over the last 40 years, we have introduced ever more complex technology to get the most out of the Sultanate's oilfields. Increasingly, we have understood that enhanced oil recovery technologies hold the key to the future of Oman's oil production." He added that although the Sultanate was blessed with plentiful oil and gas resources, it’s unusually complex geology made the task of realizing this wealth particularly challenging.”

Petroleum Development Oman has learnt that it was only by applying the right technology that it would manage to unlock Oman's full wealth potential.

UAE to continue supplying oil to the international market

Mr Shaikh Khalifa bin Zayed Al Nahyan president of UAE, while addressing at the closing session of the Organization of the Petroleum Exporting Countries, has reiterating UAE's commitment to continue supplying oil to the international market.

Mr Khalifa attributed the increase in oil prices to the rising consumption, the high taxes imposed by the consumer countries, market speculations and to the fact that some producing countries have become oil importers. He called for developing clean, safe and cheap alternative sources of energy. He also commended OPEC's role and policy aimed at maintaining the interests of producers and consumers alike, as well as maintaining stability in the world oil market.

He said that “We call for developing clean, safe and reasonably priced alternative sources of energy to ease the burden on producing countries." We are committed to supplying the world oil market to drive human development.”

NDRC plans ways to implement obsolete capacity closure

It is reported that Mr Xin Guobin the director of Industrial Policy Department of China National Development & reform Commission noted in “China Energy Sustainable Development Forum” on November 17th 2007 that NDRC is now planning to perfect effective mechanism of outdated capacity closure and to construct industrial adjusting fund in order to close down outdated capacity.

Mr Xin Guobin indicated that the program for the construction of the fund has already been reported to the leadership but has not been approved yet. He said that “In order to stimulate the adjustment of industrial structure, the national finance would cost CNY 2 billion to boost the closure of outdated capacity in 13 sectors. CNY 2 billion is limited for 13 sectors, but it is a good beginning.”

Mr Ma Kai director of NDRC said that there is overmuch capacity in many industries in China, including iron and steel industry, electrolytic aluminum, ferroalloy, coke, auto manufacture, copper smelting industry etc. Furthermore, there is potential overmuch capacity in industries such as cement, electricity power, coal, weave sector etc.

HR price outlook for November positive in China

It is reported that the survey of 46 steelmakers and 133 traders by MySteel shoed that increasing market participants are expecting HR sheet & coil prices to steam ahead in the 4th week of November as benchmark 3.mm and 4.75mm HRC prices have increased by CNY 41 per tonnes and CNY 39 per tonnes on a WoW comparison. The market talk has that the upcoming rebate change would not affect HRC, which has made market participants become optimistic again.

Domestic HRC market is likely to see supply shortfall of certain gauge products in near future due to the joint maintenance of a number of major producers. Escalating input cost is set to lend further support to HRC prices in particular steep iron ore price. Most HRC producers intend to raise up EXW price to recoup higher cost of ore imports in days to come.

The rumor is circulating that Baosteel would hike its EXW price of HRC in first quarter of next year, indicating its positive expectations for the price trend. This has helped clear the market concerns about the future market trend.

Meanwhile, the transport bottleneck via road or vessel due to tight supply of gasoline would further extend the lead time of arrivals of new materials. In addition, the inventory remains at a desirable level in most regions across the country at the moment.

However, steel traders are faced with mounting pressure in returning loans due to the credit squeeze. Steel mills are encountering similar problem when it comes to capacity expansion. The end-users are less willing to accept current steep HRC price and therefore only purchase small volume.

Mysteel has conducted the weekly survey over HR steel market development in the week ended November 16th 2007 among market participants from 15 major cities including Shanghai, Nanjing, Hangzhou, Jinan, Beijing, Tianjin, Guangzhou, Wuhan, Changsha, Zhenzhou, Shenyang, Xi'an, Lanzhou, Chengdu and Chongqing.

(Sourced from MySteel.net)

Western Mining Co buys stake in Xining Steel

It is reported that Western Mining Co will invest CNY 1.1 billion to hold stake of Xining Steel, promoting to be second largest stakeholder of Xining Special Steel. Total registered capital of Xining Steel will attain CNY 2.789 billion.

Under the instruction of Qinghai provincial government, the expansion of capital and stocks is aimed at increasing the competitiveness of state owned enterprises and stabilizing the economy of Qinghai province.

Ferrochrome producers may turn to China on strong demand

YIEH reported that Ferrochrome producers could find that they would make more money if they divert sales to China from Europe if European steel mills continue to squeeze prices. They had initially planned and increase of USD 0.10 per lb to 1.10 per lb for the last quarter but the situation has been different now.

Mr Danko Konchar the chairman of SC during a Metal Bulletin conference last week said that the group would need an increase of USD 0.30 lb in the first quarter of next year. He explained that the only reason for increasing the price was rapidly rising and uncontrollable input costs, such as exchange rate, increasing cost in freight, doubling coking coal prices and tariff.

He also pointed that the impressed increase in demand from China in the past three years, which offered them another great potential market. In 2005 China imported around 50,000 tonnes of ferrochrome from SA, which doubled to 100,000 tonnes last year.

The ferrochrome production of South Africa accounts for 75% of the world.

China coal export and imports during January to October 2007

It is reported that China retained coal net export in October for the fourth consecutive month. Of this total, it is the first time that coal export growth exceeded import within three years. The soar of international coal price caused coal import to fall.

Primacy data issued by General Administration of Customs showed that China's coal export in October amounted to 3.72 million tonnes up by 15.2%YoY and export volume amounted to 5.25 million tonnes up by 18.8% YoY as compared with the corresponding period of last year.

China's coal export from January to October reached 43.26 million tonnes down by 17.6% YoY as compared with the corresponding period of last year and coal import amounted to 42.34 million tonnes up by 44.1%YoY.

Weihai Jigang Qiyue Ship Steel Co completes phase 1

It is reported that after ten months of construction, the first phase of the project of Weihai Jigang Qiyue Ship Steel Co at an investment of CNY 168 million has been successfully completed.

The total investment in the project is CNY 668 million and there are three phases. After final commission of the project, the annual sales income could be CNY 5 billion and it would become the largest ship steel processing company in China.

After ten months of construction, the first phase of the project with an investment of CNY 168 million has been successfully completed. It is realized that after final commission of the project, the annual sales income could be CNY 5 billion and it would become the largest ship steel processing company in China.

Weihai Jigang Qiyue Ship Steel Co is founded by Jinan Iron & Steel Group, Shandong New Shipbuilding Heavy Industry Co and Weihai Qiyue Vessel Material Co. It specializes in processing and distribution of ship steel for shipbuilding enterprises.

Chinese province wise iron ore production in January to October 2007

It is reported that China's Iron ore output in January to October output was 59.838million tonnes up by 13.6%YoY.

The province wise Iron ore production is as under

In million tonnes

(Sourced from MySteel.net)

Xuanhua Steel coke ovens win national special class standards

It is reported that four coke ovens in the coking plant of Xuanhua Iron and Steel under Tanggang Group won the national special class standards after identification by an expert team led by the China Coke Industry Association.

JN60-82 type of No 1 and 2 coke ovens in Xuanhua Steel started operations in 1989 and 1993 respectively. They were the first generation of large coking ovens that China ever designed by its own.

JN43-804 type of No 3 and 4 coke ovens opened in 2003 and 2004 respectively.

Minsheng Bank extents CNY 2 billion credit to Jigang

It is reported that Jinan branch of the Minsheng Bank of China signed a comprehensive cooperation agreement with Jinan Iron and Steel Group and has extended CNY 2 billion credit.

According to the agreement, Jinan Branch of MinSheng Bank and Jinan Iron and Steel Group will carry out cooperation mainly in financial services, capital clearing, capital operation and other aspects, Jigang group will use these funds to research and develop new products.

Lingyuan announces price increase for welded pipes

YIEH reported that China’s Lingyuan Iron & Steel Group announced to rise the price for welded pipe, effective from November 17th 2007.

The price will be raised by CNY 50 per million tonnes for 15mm to 108mm diameter and CNY 30 per million tonnes for 114mm to 219mm diameter. The current price for 08mmx3mm is around CNY 4,260 per million tonnes while 219mmx4mm is about CNY 4,340 per million tonnes.

Chonggang increases CR prices

It is reported that Chonggang’s CR coil price increased by CNY100 per tonnes November 19th 2007
1. 0.8mm ST12 CR coil EXW price at CNY 5,300 per tonne
2. 1.0mm ST12 CR coil EXW price at CNY 5,200 per tonne
3. 1.5mm ST12 CR coil price at CNY 5,150 per tonne
4. 2.0mm ST12 CR coil EXW price at CNY 5,140 per tonne

Pickled and oiled HRC prices also increased by CNY 100 per tonne and now 3.0mm SPHC P&O is priced at CNY 5,080 per tonne

All prices are with 17% VAT.

CISA calls for cooperation between Pansteel and Ansteel

It is reported that Zhang Xiaogang the chairman of China Iron & Steel Association visited Pansteel Group on November 16th 2007. He praised the achievement of industrial and product structure adjustment in Pansteel and hopes Pansteel to further strengthen the research and analysis on iron and steel market and to raise economic profit.

Mr Zhang Xiaogang said that “Pansteel and Ansteel are steel enterprises with few mineral resources in China at present. They should strengthen the effective exploitation and utilization of mines and maintain sustainable development.”

Mr Zhang added that “As state owned enterprises, Ansteel and Pansteel should further strengthen the communication and cooperation, including innovations in management and in technology, in order to make contribution for Chinese iron and steel industry.”

Russian steelmakers prepare AD complaint on coated steel imports

YIEH reported that Russian steel majors Severstal, MMK and NLMK will prepare official anti dumping complaints to Russian authorizes on imports of color coated coil & sheet and galvanized coil & sheet. They may start to file those in January, according to one Severstal sales director.

Recently there are no specific targeted countries has been revealed but current Eurofer’s anti dumping measures may be the lead. The complaints may be against China, South Korea and Taiwan. Also, one Middle Eastern country may also be targeted.

Update on Severstal expansion plans

It is reported that Severstal will keep steel as its core business and is looking to expand its steel operations in Russia, the United States and new markets. Mr A Mordashov CEO of Severstal during a UBS conference recently said that "We could do some acquisitions in geographical areas where we already have a presence. We are thinking of fast growing economies like China, maybe India.”

He said that the high price of existing steel assets also made building new plants attractive He added that "Further valuation could be achieved through Greenfield expansion because of the current cost of assets."

Mr Mordashov said that Severstal plans to invest USD 10 billion between now and 2011. It will spend USD 6 billion on steel assets in Russia, where the company says the construction market will grow by 20% to 25% a year to 2010.

He informed that "We are going to build three new mini mills, with capacity of roughly 1 million tonnes each. We see a very robust market in the European part of the country." Severstal is building two USD 500 million mini mills to produce bars and wire rod for the construction industry. Both will be launched in 2010, one in Balakovo in Saratov region and the other in Dzerzhinsk, in Nizhny Novgorod region. Another mini mill to produce sections and tubes for use in the construction industry will require investment of USD 110 million and will be launched in Vologda region in 2009.”

Severstal's main steel plant, Russia's second largest, is in the northwestern city of Cherepovets. It also has assets in Italy and the United States. It owns the former Rouge Steel plant in Dearborn, Michigan and last month launched its SeverCorr joint venture in Mississippi to produce flat steel for use in car making, construction and other industrial sectors.

St Petersburg Port strike ends after court order

A Russian court Friday ruled against a continuation of four day strike action by part of the workforce at the Russian port of St Petersburg.

The ruling was a temporary injunction and allows for new strike action from the middle of next month if there is no agreement between the union and the port operator company in the interim.

Only part of St Petersburg was affected by the strike action with unions and management at two other port operator companies having already reached agreement on wage rises.

Dundee to invest USD 300 million in molybdenum mine in Serbia

It is reported that Canadian miner Dundee Precious Metals Inc is ready to invest as much as USD 300 million in molybdenum mine in southern Serbia. The Mackatica mine was opened in 1941 by the Nazi occupying force and shut down after the end of the war.

Dundee Precious Metals has done exploratory drilling in 51 locations and covered the area of some 82 square kilometers in the region.

Mr Nikola Savic Dundee Precious Metals' director for Serbia said that "There are real possibilities for opening a molybdenum open pit in Mackatica near the town of Surdulica."

Mr Savic said that geologists have discovered molybdenum fields which are profitable for exploitation as well as some gold and copper. Molybdenum is an element used in production in metals. He said "We have initiated a preliminary study, which is scheduled for completion in early 2008, and after that we will start our feasibility study." He did not specify that when the full investment may be made.

The company has an office in Serbia and a contract with the government to explore for various metals.

Dundee, based in Toronto, also owns businesses in Bulgaria.

Russia China gas sales deal could affect Kovykta development

Interfax cited Mr Alexander Medvedev Deputy Chairman of Gazprom as saying that agreements between Russia and China on the sale of Russian gas to China may have some impact on the development of the Kovykta gas condensate field.

He said "Two factors, mainly the adoption of a program for the development of the gas industry in East Siberia and the Far East and the fact that Gazprom expects to complete the deal on joining the Kovykta project in the near future naturally influence gas sales to countries to the East."

Mr Medvedev said that "As the deal has not yet been completed, we have only preliminary calculations on how Kovykta may affect our plans. As we said before, we do not sell gas from particular fields. Gas will be sold from the integrated gas supply system, which will be developed in East Siberia and the Far East as well."

He said "At the first stage, it is planned to serve the domestic market: the East Siberia and the Far East gas industry development program envisions covering domestic needs. Only if there are surpluses of gas in the future will it be exported."

Asked when the construction of an eastern section of a gas pipeline from Russia to China could be completed, Mr Medvedev said "There are no dates yet. The dates will be determined based on commercial negotiations. But in any case, the Kovykta field development plans have been presented to the Natural Resources Ministry."

Asked whether the development of some gas fields could be postponed if no progress is made at negotiations with China, Mr Medvedev said, "If agreements are concluded with China, the development of this or that field could be accelerated. But we will not start producing gas until we have sold it."

Hyundai to open a car plant in northwest Russia

RIA Novosti cited authorities in the Leningrad Region as saying that South Korean auto giant Hyundai could select a site by the end of the year to build a USD 400 million car plant in northwest Russia.

Hyundai intends to build a plant with capacity of 100,000 to 200,000 cars per year in the region, which surrounds St Petersburg.

The authorities of the Leningrad Region said the South Korean company also plans to build other auto component plants in Russia, requiring additional investment of around USD 300 million. Both projects will create about 7,000 jobs.

With rapidly rising purchasing power in Russia, foreign auto makers are seeking to expand their presence in the country. A number of foreign companies, including auto giants US based Ford Motor Company, Germany's Volkswagen, Japan's Toyota, and France's Renault have either opened or are building plants in Russia.

StatoilHydro to specify Shtokman investment plans in 2 years

RIA Novosti reported that Norway's StatoilHydro, which holds a 24% stake in the Shtokman gas field in Russia's Arctic, will specify its investment plans in the project within two years.

Mr Per Kjaernes manager of StatoilHydro in Russia said "So far, we have not carried out preparatory work and have not drafted a detailed plan to calculate the project's investments. StatoilHydro will be able to specify its investment in the project in two years."

The ambitious project to develop the Arctic gas field, with estimated gas reserves of 3.7 trillion cubic meters, is intended to supply the Nord Stream pipeline from Russia to Germany, being built under the Baltic Sea. The Shtokman project cost is estimated at USD 30 billion.
Russia's state controlled natural gas giant Gazprom and StatoilHydro agreed on October 25th 2007 on the joint development of the Shtokman gas and condensate deposit in the Russian sector of the Barents Sea. Under the deal, StatoilHydro has a 24% interest, while France's Total and Gazprom have 25% and 51%, respectively.

Ukraine seeking tighter norms for oil tankers

Ukraine Journal Staff citing Viktor Yanukovych Prime Minister of Ukraine reported that Ukraine will seek to change maritime regulations for oil tanker shipments in the Kerch Strait, following a major oil spill in the area recently.

Mr Yanukovych chaired a special meeting, attended by the energy and fuel minister, emergency minister and environment protection minister, in reaction to the fuel oil spill after a severe storm broke a Russian oil tanker in two. He said that “We have to examine the regulations for operation of the Kerch Strait. We have to take into account the environmental disaster and to work jointly with Russia to prevent such disasters in the future.”

The Kerch Strait a Ukraine controlled waterway linking the Black Sea and the Sea of Azov is used by thousands of mostly Russian ships carrying commodities including fuel oil, to customers in the region.

Net inflow of capital in Russia to reach USD 80 billion

Mr Alexei Kudrin Vice-Premier and Finance Minister said net inflow of capital in the Russian economy may reach USD 80 billion in 2007.

He added that direct foreign investments in Russia may annually amount to USD 45 billion to USD 50 billion in the short or even medium term.