Indian iron ore spot FOB price up by USD 5 in last week

The China Chamber of Commerce of Metals, Minerals and Chemicals Importers and Exporters has announced that the average reference prices for import transactions of Fe 63.5% Indian iron ore concluded last week on December 17th 2007.

The change is with respect to prices posted on December 10th 2007

The CCCMC reference prices are average prices for import transactions of Fe 63.5% Indian iron ore concluded the week prior to issuance date of such reference prices. The reference price practice is intended to regulate the domestic trading of Indian iron ore and avoid speculation on the raw material for China's booming steel industry.

Wuhan, Daewoo and Man ink pact for pipeline steel

It is reported that WISCO International Trade Corporation, Indian MAN Industry Group and South Korean Daewoo International Pipeline Steel Co Ltd have signed memorandum of cooperation recently.

Under the memorandum of cooperation with the Wuhan International Trade Corporation will support Man Group and Daewoo International Cooperation for development of pipeline international market and gradually bring the tripartite cooperation from the general steel trade to technology and development, iron and steel, ores and related fields, the deep seated level of development, and the establishment of an effective technical services unimpeded channels.

The signing of the memorandum of cooperation will promote the WISCO product quality, technology and service standards improve, expand Wuhan pipeline steel products in India, the Middle East and Europe and the United States, and other regional markets.

GAIL plans to set up pipeline and construction JVs

ET reported that GAIL India is planning to set up 2 JVs with strategic partners for pipeline manufacturing and a construction business. As per report, The proposed companies could be two separate JVs where GAIL would have minimum 50% equity stake in each.

As per report, GAIL is in the process of instituting feasibility studies for the two projects and the report would be soon placed before the board for its approval.

Dr UD Choubey chairman & MD of GAIL told ET that “We are considering to set up two companies with or without strategic partners. In case of JVs, we would join hands with top domestic or international players in the respective fields.”

The report cited a GAIL official as saying that “Pipeline laying is approximately 35% of the total project cost. GAIL is expected to invest around INR 16,000 to INR 18,000 crore in expanding its pipeline networks within the country in the next five years. Our own projects alone would involve construction works worth INR 6,500 to INR 7,000 crore. Based on this, the proposed construction company would be able to generate a profit of INR 1,400 crore in the next five years by executing only GAIL’s projects.”

The plan is part of the GAIL’s strategy to enhance its turnover from INR 16,047 crore in 2006-07 to INR 50,000 crore in 5 years by executing massive projects both within the country and abroad in the next five years.

TATA Steel’s investment firm buys stake in Steel Strips Wheels

It is reported that the board of Steel Strips Wheels, at its meeting held on December 15th 2007 approved the issue and allotment of up to 1,255,856 equity shares of INR 10 each to Kalimati Investment Company on preferential basis.

The shares will be allotted at a price of INR 170 each, subject to the approval of the shareholders in their meeting to be held on January 11th 2008

Kalimati Investment Company is a wholly owned subsidiary of TATA Steel, who is the main supplier of raw materials to the company.

SSWL, which has capacity to make 6 million steel wheels annually, plans to increase capacity to 10 million by the end of this fiscal. At present, it caters to passenger cars, multi utility vehicles, two and three wheelers. It has a partnership with Ring Techs Company Ltd, a Sumitomo group company. Some of its customers include Kubota Japan, a tractor manufacturer that recently placed an order for 40,000 tractor wheels rims.

Jai Balaji to raise INR 5.87 billion through stake sell

Reuters reported that Kolkata based steel maker Jai Balaji Industries Ltd will sell 15% stake for raising INR 5.87 billion to fund its expansion plans.

Mr Aditya Jajodia chairman & MD of told Reuters that “It would issue 6.11 million convertible debentures to private equity firms Citi Venture Capital Funds and 2.24 million debentures to India Equity Partners at a conversion price of INR 326.90 per share.” He added that upon conversion, Citi would hold 11% in the firm while India Equity Partners would hold another 4%.

Mr Jajodia further added that the firm would also issue 9.6 million warrants to its founders, which would be converted into equity shares in 18 months at INR 326.90 per share.

Mr Jajodia said that Jai Balaji currently produces 1.2 million tonnes per year at its plants in the states of West Bengal, Orissa, Jharkhand and Chattisgarh. He added that "We will expand capacity in existing plants to meet growing demand for steel.”

INR 806 crore revival package for HEC approved

It is reported that the Jharkhand government has finally cleared the much awaited revival package worth INR 806 crore for the Heavy Engineering Corporation Limited.

As per the arrangements

1. Jharkhand government would pay the Jharkhand State Electricity Board INR 500 crore to clear the HEC's outstanding electricity bill and in lieu of it HEC would transfer 2342 acres of unused land at its disposal to any department or industry nominated by the state government. The transferred land would be free from all encumbrances and HEC would transfer it permanently.

2. Jharkhand government would condone INR 25.51 crore sales tax dues

3. Jharkhand government would condone INR 31.03 crore in dues to pay Water and Sanitation Department.

4. An INR 250 crore rehabilitation package
A) INR 60 core of the package forms cost of the buildings of the HEC bring used by the government
B) INR 20 crore is for the land attached with these buildings
C) INR 170 crore will come to the HEC as pure grant for its revival but with a rider that no payment would be made for any piece of land the government takes over from the company in future

Update on Bangalore Metro

BK reported that the plans for Bangalore Metro Project, branded as Namma Metro are underway smoothly with progress on almost all the fronts. Namma means our in Kannada. Namma Metro will be built on standard gauge, unlike Delhi Metro that is built on broad gauge with a target completion date of five years from start of construction. Bangalore Metro, as envisaged, has a total length of 33 kilometers comprising of East to West corridor of 18.1 kilometer and North to South of 14.9 kilometer corridor.

The total project cost is about INR 6,395 crore based on 2005 prices and INR 1795 crore is funded by Japanese Bank for International Corporation loan, apart from equity and subordinate debts by the Central Government and Karnataka Government. It also plans to raise INR 1100 crore from domestic market, has appointed UTI Bank as lead banker

Mr BS Sudhir Chandra director Project & Planning told Business Line that “Bangalore Metro, which would follow a two stage bidding process, would come out with the list of technically qualified bidders for the signalling and telecom tender over the next one and a half months.”

7 consortiums, which are led Alstom, Bombardier, Siemens, Larsen & Toubro, Mitsubishi and Westinghouse Rail Systems, have lined up for designing, supplying and commissioning the signaling and telecommunication equipment systems for the Bangalore Metro. The project value is expected to be of the order of INR 400 crore.

Additionally, Bangalore Metro Rail Corporation is likely to invite financial bids for its INR 700 crore to INR 800 crore tender for rolling stock supply in January 2008. Bids are likely to be invited from Alstom, Bombardier, Siemens, BEML-Mitsubishi-Rotem for supply of 117 metro coaches. The coaches will each have a passenger capacity of 356, 50 seating and 306 standing.

Indian scrap demand to surge to match steel making capacity

A public report showed that Indian ferrous scrap annual demand will reach 20 million tonnes, which includes 6 million tonnes to 7 million tonnes imports, under estimation that the steel production will increase to 100 million tonnes by 2020.

The report showed that currently, India requires about 5.5 million tonnes ferrous scrap, including 3.3 million tonnes from domestic supplier and 2.2 million tonnes from imports.

TIL crosses 5000 mark in crane manufacturing

TIL, formerly known as Tractors India Limited, has achieved a landmark recently by dispatching 5000th crane from its Kamarhatty plant. The momentous occasion was celebrated at TIL’s Kamarhatty plant, where the 5000th crane was unveiled amidst a spectacular show. The crane was handed over to Reliance Petroleum for its Jamnagar project amidst a gala ceremony

The 5000th crane that has been rolled out is of Rough Terrain variety- RT 630C.The model is manufactured in technical collaboration with Grove-USA., a part of Manitowoc Crane Inc. The model has all the state of the art features and is used in all the core sectors like construction, mining, defense, refineries, steel, and power. The major strength of the product lies in its extra long boom and lifting capacity compared to the competition. Other noteworthy features are its maneuverability in slushy conditions with great mobility and excellent pick and carry duties. All controls are hydraulically powered resulting in higher speed of operation. Another unique feature is its reduced dimensions making it more efficient for working in confined areas.

Mr Sumit Mazumder MD & CEO of TIL said “The 5000th crane celebratory event was yet another occasion where TIL demonstrated its strong customer focused approach and constant quest for quality and innovation enabling the company to sustain its superior position as a customer partnering organization”.

Mr Glen Tellock president of Manitowoc Company INC said that the collaboration with TIL has always been a matter of great pride for Manitowoc and the commitment and innovation to grow is a common bond that has cemented this relationship of over 40 years .

Since 1944 TIL has been amongst India’s leading providers for a wide range of technology intensive equipment for infrastructure development and has led the Indian mobile crane market.

MMTC to start preliminary exploration in Gomia Saram coal block

It is reported that MMTC Limited has invited global bids for carrying out preliminary exploration study in the Gomia Saram coal block in Jharkhand.

MMTC in a statement said that "The Coal Ministry has allocated the Gomia Saram coal block to us. The block has fairly good quality of coal needed for the steel industry. Coal in the block is of fairly good quality though relatively high in ash content. The grades vary from steel quality to over 35% ash. These are high volatile medium coking coals with prime coking characteristics.”

MMTC is going in for the capital intensive coal exploration business with a view to achieve backward integration in the field of hydrocarbons. It is mainly engaged in international and domestic trading of commodities, also deals in a variety of minerals, metals, precious metals, fertilizer, coal and hydrocarbons.

Minitec may sell two EOFs to Indian steel companies

ET reported that Brazilian steel technology supplier Minitec is negotiating a USD 3 million contract to sell two Energy Optimizing Furnaces to Indian steel companies, SLR Steel and SBQ Steel.

The report quoted Mr Henri Pfeifer Director of Mintec as saying that "Minitec will do feasibility studies of EOF installations at each mill, with capacities to produce 300,000 tonne to 700,000 tonnes per year of steel, respectively, with the investment of USD 1.5 million on each mill.

An EOF installation takes about eight months.”

Minitec has already been involved in more than 20 Indian projects, including mini blast furnaces and EOF steel plants. Now it is negotiating to sell new products, including mini sinter plants.

One of the Indian projects is at Southern Iron & Steel Co, part of the Jindal South West steel group. In October, the company is likely to inaugurate its second EOF plant, with capacity to produce 600,000 tonnes per year, raising Siscol's output to 1 million tonnes per year.

Minitec hopes that after this plant is inaugurated, other orders will come its way both from existing customers and from potential new clients that the company delegation met during a visit to India last week.

Mr Pfifer said that "There are lots of Indian companies that will like to construct small steel plants, with capacities up to 600,000 tonnes per year. For this tonnage, our technology is one of the most competitive in the world.”

Eastern Railway’s Howrah division increases coal traffic

BL reported that the Howrah Division of Eastern Railway, which started handling coal traffic on regular basis only from 2006-07, is now poised to achieve significant growth in throughput.

As per report the throughput, which was around 1 million tonne in 2006-07, is likely to rise to more than 3 million tonnes during the current fiscal.

The report added that the average daily loading of coal wagons in terms of four wheelers was around 200 in December 2006 has already touched close to 500 in this year and at this rate, the total throughput might touch the level of 3.5 million tonnes by March 2008.

The entire coal is being dispatched to Punjab’s thermal power stations located at Ropar, Bhatinda and other places.

ABG Shipyard bags major orders from oversea companies

ABG Shipyard Limited announced that it has won repeat orders worth INR 10 billion from international clients, taking its total order book to INR 82.77 billion.

In a filing to the Bombay Stock Exchange, ABG Shipyard one of the country private sector shipbuilding yard, said that Thailand based Precious Shipping Public Company Ltd and ESLL of Cyprus, have together placed an order worth USD 187.48 million for five bulk carriers of 54,000 DWT.

It added that Cyprus based Lamnalco Ltd and Egyptian Maridive and Oil Services SAE have placed orders to build two vessels each, worth USD 34.20 million and USD 46 million.

Mr Dhananjay Datar CFO of ABG Shipyard told Thomson Financial News the company plans to deliver the new vessels as well as those presently under construction by December 2011.

BHEL and NTPC signs JV agreement for EPC business

Bharat Heavy Electricals Limited announced that a JV agreement between the Company and National Thermal Power Corporation Limited has been singed on December 17th 2007 for establishment and operation of a JV for taking up EPC business.

REL and Hyundai consortium bids for Mumbai Trans Harbor Project

It is reported that a consortium of Reliance Energy Limited and Hyundai Engineering Construction Company has submitted its bid for the Mumbai Trans Harbour Sea Link Project. The consortium is supported by a team of consultants, which includes Systra of France and BRDI from China.

REL in a release said that the project entails construction of a six lane 22 kilometer bridge connecting Sewri in the island city to Nava in Navi Mumbai with an estimated to cost over INR 4,000 crore and will take over five years to complete.

Bhoruka Power plans 300 MW plant in Karnataka

It is reported that Bhoruka Power Corporation, a part of Bangalore based Bhoruka Group, plans to set up 300 MW thermal power plants in Karnataka.

The project will be executed through Bhoruka Energy, a 100% subsidiary of Bharat Petroleum Corporation. The company has submitted an application to the government for 300 acres of land for setting up the power plant, which is estimated to cost INR 1,200 crore.

IPPs to submit power plant plans

SNS recently reported that Orissa government has asked independent power producers, who have signed MoUs with Orissa government to set up power plants, to submit their detailed business plan in terms of generation and sale of power. They have been asked to provide their business plan, financial closure, details of to whom & where they want to sell power and their construction schedule.

Orissa government held a meeting with 13 of them last week, which was also attended by representatives of the Power Grid Corporation of India Ltd, NTPC, Orissa Power Generation Corporation and Orissa Hydro Power, to address perspective planning for strengthening the transmission network and ensure proper evacuation of power.

Mr SN Patro energy minister of Orissa said that “With all these power plants in the pipeline and many of them scheduled to be commissioned by the year 2011-12, one has to plan for proper evacuation.”

Mr Patro pointed out that as per the present policy of the state government, the private generators have to sell a minimum of 25% of their generation to Orissa before marketing the rest. He added that some of the independent power producers have reportedly entered into agreements with Kerala, Haryana and other states.

As per report, by 2011-12 the demand in Orissa will rise to 4459 MW and if the 13 power plants come up the additional generation will be 16,000 MW. Besides an ultra mega power plant of 4000 MW and another 1000 MW plant have been proposed.

ArcelorMittal terminates of Sparrows Point agreement with E2

ArcelorMittal announced that it has terminated its agreement with E2 Acquisition Corporation for the sale of ArcelorMittal USA’s Sparrows Point, Baltimore facility and related assets to E2 due to E2’s inability to secure financing. E2 is a joint venture sponsored by Esmark Incorporated and Wheeling Pittsburgh Corporation.

The release said that “ArcelorMittal terminated the purchase agreement upon the direction of the court appointed trustee who has the authority to affect the divestiture of Sparrows Point. ArcelorMittal will continue to work closely with the DOJ and the court appointed trustee to satisfy the terms of the consent decree.”

The execution of the definitive purchase agreement for the sale of Sparrows Point to E2 was announced on August 2nd 2007. The closing date for the sale of Sparrows Point agreed to in the purchase agreement with E2 was November 30th 2007. On November 29, 2007, ArcelorMittal agreed to extend this date to December 11th 2007.

The divestiture of Sparrows Point by ArcelorMittal grew out of the bid by Mittal Steel Company NV for Arcelor SA As part of that process, Mittal agreed with the DOJ, pursuant to a court ordered consent decree, to divest the Sparrows Point facility.

Sparrows Point is a fully integrated steel making facility is capable of producing 3.9 million tonnes of raw steel annually. Products made at Sparrows Point include hot rolled sheet, cold rolled sheet, galvanized sheet, Galvalume, tin mill products and semi finished steel. Markets served include construction, steel service centers, automotive, container and appliance.

Zinifex makes takeover offer for Allegience Mining

Zinc producer Zinifex has made an all cash offer for all the shares in mineral explorer, Allegiance Mining. As per release Zinifex is offering 90 cents per Allegiance share or AUD 1.00 per Allegiance share if it acquires more than 30% or if the Allegiance board recommends the offer. If successful, the offer values Allegiance up to AUD 775 million.

The zinc producer said the offer represents a significant premium over Allegiance's last closing price.

In a slide presentation submitted to the Australian Stock Exchange, Zinifex said the potential takeover is an excellent fit with Zinifex's strategy, an attractive entry into nickel and adds near term production with scope for expansion.

Mr Andrew Michelmore CEO of Zinifex said that "For Zinifex shareholders, we like nickel as an attractive long term growth business and Allegiance's Avebury project is an excellent entry point for Zinifex.” With nickel production due to commence in early 2008, this mine would add immediate growth to Zinifex's existing profit centres, the Century and Rosebery mines.”

Mr Michelmore said that "Avebury is just the start of our strategy to vigorously grow in Zinifex's chosen base metals of copper, nickel and zinc. We like investing in high margin, long life, expandable mines, and Avebury delivers all of these attributes.”

The offer will be financed from Zinifex's current cash balance.

Rio to extend Kestrel coking coal mine life

Rio Tinto has announced an extension of its Kestrel Mine in Queensland.

Rio Tinto said that the USD 991 million investments will address the growing demand in Asia for export coal. It is estimated the extension will increase production to an average 5.7 million tonnes of coal a year until 2031.

Mr Preston Chiaro CEO Energy of Rio said that "This represents a further 20 year commitment to the Bowen Basin and is a strong vote of confidence in the Asian coal market. The extension will enable us to tap into 112 million tonnes of high quality hard and semi hard coking coal and thermal coal for export."

The Kestrel Mine is located 51 kilometres north east of Emerald and produces 4 million tonnes of coking coal in a year for the export market.

First ship loaded at Vale port after incident

Reuters reported that Port officials at Brazil's Sepetiba terminal on Monday has resumed delayed iron ore loading over the weekend after an accident forced mining company Vale to declare force majeure on some shipments.

Mr Marcos Nicolau a technical control manager at the Sepetiba port said that "We have finished loading the first ship with iron ore after midnight. The operations should continue. Three more ships are waiting to be loaded.”

He said loading in the Rio de Janeiro state port started on Saturday, as Vale has envisaged the previous day.

Vale said last week operations at the port terminal would resume on a provisional basis while repair works, after a ship damaged a mooring dolphin, should take 30 to 40 days.

Sepetiba is the smallest of Vale's four iron ore terminals and it was also sending some the raw material waiting to be loaded to the other ports.

Cosipar and Minmetal to set up a steel plant in Brazil

It is reported that Brazilian steelmaker Cosipar’s pig iron making subsidiary's Usipar plans to set up a steel making JV with Chinese Minmetals Corp.

Mr Luiz Guilherme Monteiro financial director of Cosipar told Reuters that the two sides were close to completing a feasibility study for a 2 million tonnes of steel a year plant next to Usipar's Barcarena pig iron works in northeastern Brazil worth up to USD 2 billion. He said "In 60 days we should finalize the study that will be the basis of our agreement.”

He added that "Minmetals have made a firm proposal to participate. As soon as we have a guarantee of raw materials supply, they said they are interested in taking part.” As per report, Mr Zhang Yuan Rong, VP of Minmetal visited Usipar recently.

Mr Monteiro said that “In the first stage, the partners would build two blast furnaces to produce 1 million tonnes of steel a year, a pig iron converter and a continuous casting machine, as well as construct a port. In the second, two 500,000 tonne furnaces or one 1 million-tonne unit would be added.”

He added that “If given the green light, the steel project could start working in 2011 or 2012.”

BlueScope Distribution brand launched

BlueScope Steel has officially launched the BlueScope Distribution brand, as the Smorgon Steel Distribution business acquired in August takes on a new name. BlueScope Distribution forms an integral part of the new Australian Distribution and Solutions business headed by Mr Mark Vassella.

The national re branding campaign will be rolled out in stages. From today all stationery, websites and electronic documents will reflect the new names. The re branding campaign will continue in 2008 as building and fleet signs, uniforms, email addresses and other items take on the new brand.

Mr Mark Vassella CEO of Australian Distribution and Solutions said that "The Distribution team is very excited to be adopting the BlueScope name, and we look forward to helping to shape a bright and prosperous future for the company."

The new BlueScope Distribution brands are
1. SmorgonSteel Metal Distribution to BlueScope Distribution
2. SmorgonSteel rural to BlueScope Distribution
3. SmorgonSteel pipeline Supplies to BlueScope pipeline Supplies
4. Metalcorp everything in steel to Metalcorp everything in steel
5. Impact Steel to Impact Steel
6. Smorgon Steel to SMS sheet Metal Supplies

Zinifex offer for Allegiance 'opportunistic'

It is reported that the board of Allegiance Mining said that it will study the details of a takeover offer by Zinifex before making its formal recommendation to shareholders.

However, Allegiance board has advised shareholders to take no action on Zinifex's offer of 90 cents a share until the bidder's statement has been considered.

Mr Tony Howland-Rose chairman of Allegiance said that the offer is not generous, given the rarity of nickel deposits. He said "We are under our legal eagles' eyes so we'll do whatever is right and by statutue. But we have to see what has to happen, what the pros and cons of the bid really are, other than the obvious."

He added that "Life must go on despite of bids, because we are going towards production as everybody knows and we have got three months to do this in. We have got our own schedule of three months to start in the first quarter of next year and all of that must proceed, that's why again this is an opportunistic bid."

The zinc producer has a mine on Tasmania's west coast near where Allegiance is developing its Avebury mine, which begins production next year.

Rautaruukki workers to strike in Hämeenlinna and Raahe

Finnish steelmaker Rautaruukki said that its workers at the Hämeenlinna and Raahe mills would go on strike for one day on Tuesday, adding forge rolling operations would stop for two hours in Raahe Tuesday evening.

Rautaruukki said the workers had told the company's management that the industrial action was a protest against a draft bill that, if passed by Parliament, would allow the government to sell minority holdings without consulting the lawmakers.

Rio Tinto to develop Eagle nickel mine in US

Rio Tinto is planning to invest USD 300 million in the development of Eagle, a high grade nickel and copper mine in Michigan State of USA. The project is located in northwest Marquette County near the City of Marquette.

As per release, Eagle will be the only primary nickel mine in the US and first production is expected to begin in late 2009. Eagle is projected to deliver 16,000 tonnes of nickel per year over seven years until 2016. It will also produce valuable co products of copper, platinum, palladium and cobalt.

A two year project construction phase will get underway in 2008, upon receipt of additional approvals expected in 2008. Three required permits were granted on December 14th 2007. Eagle's mine permit is the first issued by the State of Michigan under the state's 2004 nonferrous metallic mining law, considered among the most stringent in the US.

Mr Bret Clayton CEO of Copper Group of Rio said that "Eagle gives Rio Tinto a valuable opportunity to enter the market for nickel, a key input into stainless steel, demand for which is rising strongly led by the development of new infrastructure in developing economies, as well as rising demand for consumer products and the development of associated processing plant and equipment.

He added that "Eagle is just one of many projects that will add to Rio Tinto's growth and value. It is a 4.1 million tonne high grade nickel resource (3.6% nickel, 2.9% copper) in a highly prospective region for additional nickel discoveries. Our exploration team discovered Eagle in 2002 and we are now reviewing over 450,000 acres of mineral title we have in the area. Our focus is on six further adjacent prospects that may have the potential to extend significantly the mine life at current planned production rates."

Rio Tinto is also in final contract negotiation to develop a nickel mine at Sulawesi in Indonesia, with an initial operation of 46,000 tonnes per year with first production commencing by 2015. There is additional potential at Sulawesi of a similar size.

Japan likely to cancel import duty on HC ferrochrome

YIEH reported that Japan is like to cancel its import duty on high carbon chrome ferrous iron and that this new duty policy will be implemented in next April 2008.

Currently, Japan’s import duty for high carbon chrome irons, including three rates of general, WTO and preferential duty rate which is 7.2%, 5.3% and 3.18% respectively. Due to the high cost of chrome, the stainless steel mills asked for reducing import duty on chrome in order to gain the competitiveness.

According to the statistics, the total amount of imported high carbon chrome irons from January to October reached JPY 808 billion with the volume of 726,000 tons, and import duty income totaled JPY 4.3 billion.

USD 50 million downstream investments by PT Timah

It is reported that Indonesia’s state controlled tin company PT Timah is planning to invest USD 50 million in the production of downstream products.

According to a report by the official Antara news agency, the feasibility study for such industries had already been conducted and a memorandum of understanding had already been signed with an un named Chinese partner.

The report did not specify which downstream products will be produced, but the most likely targets are solders and tin chemicals. The new business is expected to be in operation by the end of 2008.

Timah had previously announced that it is planning capital spending of IDR 1.3 trillion (USD 140 million) in 2008, which will be used both to expand its tin reserves and diversify into coal and other businesses.

BHPB bid for Rio – Share buy back cancellation by BHPB

FT reported that BHP Billiton has suspended its USD 10 billion on market buy back of its UK listed shares until further notice, reflecting the fact that it is expected to make a bid for rival Rio Tinto.

The cancellation of the buy back program, which was extended from USD 3 billion to USD 10 billion in February 2008, comes as the UK Takeover Panel is about to set a deadline for BHP to either launch a bid for Rio Tinto or to walk away for at least six months.

The report said that “UK Takeover Panel rules state that a company can not renew a buy back mandate during an offer period because it is in the possession of market sensitive information.”

Rio Tinto said on Monday that it was pleased that the buy back had been terminated as it had been a matter of concern for them ever since BHP’s proposal was made public. It said the buy back scheme may have artificially buoyed the value of BHP’s proposed takeover offer. BHPB rejects that criticism, saying that the irrevocable mandate had to run until it expired.

Takeover Panel rejects Midwest's application on Murchison bid

It is reported that the Australian Takeovers Panel has ruled against Midwest Corporation's application regarding a bid by Murchison Metals to acquire the fellow miner.

The panel said "Midwest submitted that the bidder's statement should contain evidence that Murchison had a reasonable basis for a number of statements in relation to targeted iron ore production at the Jack Hills project, in which Murchison has a 50% interest.”

The panel ruled that “Although the bid had the potential to mislead and confuse, subsequent events mean that Midwest shareholders are now in a position where they can evaluate for themselves the relative merits of" the opposing cases. On that basis, the Panel decided not to make a declaration of unacceptable circumstances."
It added that "The Panel notes the efforts by parties to resolve the dispute between them in the period since the application, and appreciates the time and efforts they have taken."

Murchison's takeover offer was an unconditional all-scrip bid of $769 million. On November 8th 2007, Midwest had sought a declaration of unacceptable circumstances relating to deficiencies it claimed existed in Murchison's Bidder's Statement. Since Midwest's application, however, both parties have tried to resolve the dispute.

Earlier this month, Midwest also received a proposal from its joint venture partner Sinosteel Corporation of China, which offered AUD 5.60 cash per share, valuing Midwest at AUD 1.19 billion and trumping Murchison's bid. However, Murchison says Sinosteel's proposal is incomplete, non binding and subject to due diligence and other conditions.

BHPB takes Dr Morgan on board

BHP Billiton announced the appointment of a new non executive director Dr David Morgan to the BHP Billiton board effective 1st January 2008. He is currently the MD & CEO of Westpac Banking Corporation, with effect until 31st January 2008.

Mr Don Argus chairman of BHPB said that Dr Morgan’s appointment would be an important and valuable addition to the BHP Billiton Board, bringing with him more than 30 years’ experience in the financial sector.

He said that "We are delighted that we have been able to secure the services of someone of David’s caliber for our Board. He brings with him a wealth of financial services experience, having worked in both the private and public sector, including heading Westpac, for the past 9 years, and prior to this at the International Monetary Fund in Washington DC and as the Senior Deputy Secretary of the Australian Federal Treasury."

Mr Argus said that Dr Morgan’s appointment would bring the number of BHP Billiton directors to twelve.

Steel prices to up by 6% to 7% in Mexico next year - Analyst

A Mexican analyst Mr Rodrigo Heredia has predicted that the price of steel products in Mexico will increase by 6% YoY to 7% YoY in 2008 because of higher production cost and soaring demand in emerging markets, especially China and India.

Mr Heredia added that with the demands continuously growing from the downstream steel products, not only in Mexico but also in the global steel market, the steel prices are in an upward trend with USD 30 per tonne to USD 50 per tonne hike.

He added that “Although the steel price keeps taking off, the market consumption and investment in the steel industry is expected to develop positively in Mexico.”

The analyst further added that this forecast refers to the general basic steel categories while for stainless steel and other special steel, the price movement may differ.

Murchison extends offer for Midwest

Murchison Metals Ltd's AUD 653 million hostile takeover offers for fellow iron ore miner Midwest Corporation Ltd has been extended to January 23rd 2008. Murchison Metals confirmed the new closing date for its unconditional offer of one Murchison share for every 1.08 Midwest share after market closed on Monday.

Murchison's offer was earlier set to close on December 20. The company flagged its intention to extend the offer period by a month in a letter to shareholders earlier in the day.

It said the decision related to an indicative, rival takeover bid by Midwest's joint venture partner Sinosteel Corporation of China. Sinosteel's offer of $5.60 cash a share values the target at $1.19 billion, eclipsing Murchison's bid.

Mr Paul Kopejtka chairman of Murchison said that "This extension will allow us to wait and see if Sinosteel is willing to make a formal offer and, if so, on what terms and conditions.”

Murchison holds 3.6% of Midwest's shares.

FMG shareholders back share split

It is reported that shareholders in the Fortescue Metals Group have voted overwhelmingly in favor of a dramatic restructure of the company.

The move involves splitting each of the company's shares into 10 which will increase the number of shares on issue to more than 2.8 billion.

FMG says the share split will improve liquidity in the company and attract more retail investors. It will begin trading under the new share arrangement on Wednesday.

Siemens bags rail automation order from Go Transit in Canada

Siemens Transportation Systems announced that it has received its biggest ever rail automation order from the Canadian transit authority Go Transit.

Siemens will upgrade the entire signaling and communication systems in and around Toronto's Union Station as well as the traffic control center. All together, the project is worth around EUR 140 million for Siemens.

The entire system upgrade will take place in 2008 during normal revenue service. The modernization of the system some parts of it dating as far back as 1920 covers a section of 5.8 kilometers including some 42 kilometers of track. The heart of this system is the Union Station.

Mr Friedrich Smaxwil as member of the Transportation Systems board responsible for Rail Automation, sees this order as a milestone in Transportation Systems ' North America business portfolio.

Mr Peter Smith President of Go Transit sees big benefits from this modernization. He said that “This gives us the opportunity once again to showcase our tremendous competence in the automation sector. The new system will allow us to improve our service and reliability and to bring more trains into service in future.”

Mr Lawrence Cannon Canadian minister for transport stressed, “The upgrade will improve the safety and effectiveness of the transportation system in greater Ontario,” adding that the project will underscore the Canadian Government's priority for public mass transit."

Weak H beam market in Tokyo

JMB reported that H beam market price is flat at around JPY 80,000 per tonne for 200mm x 100mm around Tokyo when building start is very slow due to confusion for new building standard law.

Tokyo distributors try to keep the price level with support by higher cost price.

Ms McCall joins US Steel as manager federal governmental affairs

United States Steel Corporation has announced that Ms Katie R McCall has joined the company as manager federal governmental affairs in its Washington DC office. Ms McCall joins General Managers Federal Governmental Affairs Mr Scott R Salmon and Mr Thomas M Sneeringer and reports to Senior VP Public Policy and Governmental Affairs Mr Terrence D Straub.

Prior to joining US Steel, Ms McCall held a number of important positions in Washington, including at the White House and at the prominent law firm of Skadden, Arps, Slate, Meagher and Flom LP, outside trade counsel to United States Steel Corporation. Most recently, she served as chief of staff at Van Scoyoc Associates Inc a top ranked lobbying firm where she had both management and advocacy responsibilities.

Ms McCall holds a bachelor's degree in managerial economics from the University of California, Davis and a master's degree in legislative affairs from The George Washington University in Washington, DC. She will continue to reside in Washington, DC.

Mr Straub senior VP of Public Policy and Governmental Affairs said that "We are delighted to have Katie join our Governmental Affairs Department and our Washington office. I've known her work for many years and have always been impressed with both her understanding of how policy is made in Washington and her personal advocacy skills. She is going to make significant contributions to the policy agenda of the company, the steel industry and American manufacturing."

Ezz Steel Q3 net profit up by 21% YoY

Reuters reported that Egypt's Ezz Steel has posted a 21% YoY rise in Q3 net profit recently as construction demand in Egypt drove up sales. Ezz Steel a statement said that it made EGP 291.9 million in Q3 after tax and minority interests as revenues surged 56% to EGP 4.2 billion.

Mr Kamel Galal spokesman for Ezz Steel said that "We are seeing construction demand in the oil rich countries and there is a real estate and infrastructure boom in Egypt and North Africa.”

He said we are expecting this demand to go on for some time. He added that it boosted its stake in its subsidiary Ezz Flat Steel to 75% from 59% in September 2007 also lifting sales.

Mr Tarek Shahin analyst at Beltone Financial an investment bank in Cairo said that "Demand for building materials kicked off toward the end of 2006 and you have higher volume and higher pricing. He said that the company's cost of sales rose 70%QoQ compared to the same quarter a year ago to EGP 3.2 billion largely due to rising prices for scrap. He also said that so far they've been able to pass on higher prices.”

Mr Shahin however added that but with iron ore prices forecast to increase significantly next year, there is concern about whether the company will be able to continue to pass on higher costs to buyers.

UAE building materials market to exceed AED 40 billion

Gulf media reported that, according to findings that assessed and projected the expenditure in construction materials by property developers in the country, building materials in the UAE would be worth AED 40 billion by the end of 2007.

Industry players wanting to leverage the market conducted a networking dinner recently under the auspices of Danube Building Materials, a provider of construction and building materials and a leader in shop fitting industry. The networking affair attracted 150 representatives from various sectors related to the building materials trade in the Gulf region. The participants provided each other information on new industry products, market challenges and costs issues needed by new and established players.

Mr Rizwan Sajan chairman of Danube said "Our participation as the main sponsor at the BMTG networking dinner stands as a testament to our commitment towards the total development of the industry, which we hope will inspire more companies to become part of this very important movement.”

The event was organized by the Building Materials Trading Group, an organization under the Dubai Chamber of Commerce and Industry, to facilitate the growth of local and regional building materials companies.

As per report, the construction materials trading industry is the second largest industry in the Middle East after the oil and gas sector. Dubai Chamber created BMTG to provide more business opportunities through networking between manufacturers and buyers. It now has 11 board members and over 3,000 members since its establishment in 2002.

Transworld awards contract to Guangzhou Wenchong Shipyard

Transworld Group of Companies has announced that it has recently awarded a USD 80 million shipbuilding contract to Guangzhou Wenchong Shipyard in a ceremony held at its headquarters at Jebel Ali Free Zone in Dubai.

The contract was signed by top ranking company officials including Mr S Ramakrishnan chairman of Transworld Group of Companies, Mr He Fang deputy director of China Shipbuilding Trading Company and Mr Yin Xueming chairman of Guangzhou Wenchong Shipyard. Mr Venu Rajamony Consul General of India in Dubai also present at the ceremony.

The agreement outlines the delivery of two feeder container vessels that are ideally suited for container feeder trade.

As per Transworld Group of Companies “The move is in line with the group's aim to strengthen its fleet to address the growing demand for sea cargo transportation and fully leverage the booming shipping and maritime industry in the region.”

EIIC to set up AED 1.5 billion clinker unit in Abu Dhabi

It is reported that Emirates International Investment Company is to establish AED 1.5 billion clinker cement factory in Abu Dhabi city.

EIIC has announced that construction on the factory will commence next month and will take approximately three years to complete. Abu Dhabi's first ever clinker-cement factory is expected to be ready for commercial production by end of 2010.

Mr Abdellatif Sfaxi CEO of EIIC said that "Production capabilities and volume should reach around 3.5 metric tonnes annually, once the factory is fully operational. This capacity is expected to cover most of Abu Dhabi's needs for clinker cement and we will also be able to supply a higher demand, according to our future factory expansion strategies."

Clinker is a solid material used to produce cement and mortar and if stored properly can be traded internationally in large quantities. The new EIIC factory will meet the requirements the region's real estate boom, which is increasingly inflating the demand for this basic construction component.

Toyota Tsusho bags deal for power equipments in Iraq

It is reported that Japan's Toyota Tsusho Corp has won a deal with the Iraqi government to supply electrical substation equipment for USD 40 million. The deal marked the largest infrastructure accord for a Japanese firm among those the Iraqi government has self financed since the end of the Iraq war.

According to the Nikkei Shimbun the trading company affiliated with Toyota Motor Corp will deliver 30 transformers manufactured by Meidensha Corp to substations in central Iraq, including Baghdad, starting from the end of 2008. Toyota Tsusho will also provide local engineers with training in the transformers' maintenance.

The transformers step down voltage from 132 kilovolts to 11.5-33 kilovolts and transmit the electricity to smaller, pole-mounted transformers. Together, the 30 substation transformers are capable of simultaneously transferring electricity equivalent to the amount used by more than 1 million households.

Tomen Corp., which merged with Toyota Tsusho in spring 2006, had a strong presence in the Middle East and had supplied substation equipment to Iraq since the 1970s.

Women force rising in UAE companies

Gulf Times recently reported that, encouraged by a growing number of schemes, the number of businesswomen and entrepreneurs appears to be on the rise in the United Arab Emirates. The composition of women in the UAE workforce surged to the current 33.4% as compared to 9.6% in 1986.

According to the economy ministry, UAE has over 11,000 businesswomen managing investments worth over USD 4 billion. Of these, 14.9% of the women are from Kuwait, 9.8% from Saudi Arabia, 7.8% from Bahrain, 4.7% from Oman and 4.5% from Qatar.

UAE Economy Minister Sheikha Lubna al Qasimi recently noted that UAE businesswomen have emerged key players in all walks of public life including commerce, socio-economic development and politics. Remarking on the rise in the number of women players in various endeavors, Sheikha Lubna said “There is no field that women have not excelled in.”

Emirate businesswomen invested a total of USD 3.3 billion in the economy of Dubai in 2007. These investments were made in sectors like real estate, construction, finance, trade manufacturing and hospitality.

In the Gulf, women comprise 25% of the total workforce, with 4.5% owning freehold businesses. Bahrain leads with 59% of women who are sole owners of their firms, followed, elsewhere in the Arab world, by Tunisia at 55%, 48% in Jordan and the UAE and 41% in Lebanon.

The rise of women in the workforce is partly due to investment in education by Arab rulers in the 1970s, when free education to all citizens through university was guaranteed by some Gulf nations.

Kuwait inflation hits 15 year high

State news agency Kuna, citing official statistics, reported that inflation in oil rich Kuwait hit 7.3% in the first nine months of 2007, the highest figure for 15 years,

The figures said the overall inflation came from price rises in products and services
1. Housing - 12.5%
2. Education and health - 12.3%
3. Drinks and tobacco - 9.6%
4. Transport - 7.3%
5. Clothing - 5.1%
6. Food products - 4.8%
7. Other products and services - 2.5%

On May 20th, Kuwait broke ranks with its GCC neighbors, dropping its peg to the dollar and linking its dinar to a basket of currencies, in a move aimed at reducing inflationary pressure.

Over the past five years, inflation rates have risen rapidly in the six Gulf Cooperation Council countries where increasing oil prices have dramatically boosted incomes, and spurred government spending of windfall revenues.

Vietnam invites Iranian firms to assist in development projects

It is reported that Vietnam has invited Iranian construction and production firms to participate in Vietnams’ development projects

Mr Neguyen Hong Quan Vietnam's minister of construction, in a meeting with Mr Javad Ghavam Shahidi Iran's Ambassador to Vietnam, said that Vietnam has an open economy, with laws and regulations friendly to foreign investors.

He said "Iranian companies would be welcome to submit their proposals and if they are viewed as meeting the growing needs of our country and are approved by the relevant authorities, they will be quickly cleared for implementation.’

He added that “Vietnam welcomes investment by foreign companies and investors in all of the country's economic sectors, especially housing, industrial, commercial and tourism sectors, and construction of industrial parks.”

Mr Javad Ghavam Shahidi said “Considering the friendly relations between the two countries, the current level of bilateral cooperation is not sufficient. In view of the considerable capabilities of Iran's public and private sectors in numerous areas, including infrastructural projects and construction of roads and railways, the presence of Iranian companies in the Vietnamese market would signify an important step in the furthering of ties between the two countries.”

Iran and Oman discuss transport cooperation

It is reported during the meeting between Mr Morteza Rahimi Iran's Ambassador to Muscat, and Mr Khamis bin Mubarak al-Alawi the Omani Minister of Transport and Communication recently discussed avenues for boosting cooperation in various fields and establishing a direct flight between Tehran and Muscat.

The Omani minister welcomed the expansion of bilateral cooperation with Iran and said his country would provide all the necessary facilities to that end. He called for more participation by Iranian companies in Oman's development and road construction projects.

India and Oman ink trade agreements

It is reported that India and Oman have signed several agreements to boost trade and cultural ties as Oman's Deputy Prime Minister Sayyid Fahd bin Mahmoud Al Said met Prime Minister Dr. Manmohan Singh in New Delhi last week.

The two countries also signed MoUs for cooperation in medium, small and cottage enterprises and higher education. The two countries have also signed agreements on investment protection and avoidance of double taxation.

Around 100 Indian companies are executing projects in Oman while more than 25 Omani companies have presence in India. Besides, over 400,000 Indians are working in Oman.

India's fertilizer firm Krishak Bharati Cooperative tied up with the Oman Oil Company to facilitate asset transfer and set up joint ventures. Oman Oil already has a joint venture with KRIBHCO and Indian Farmers Fertilisers Cooperative to produce 1.6 million tonnes of urea and 250,000 tonnes of ammonia annually.

Oman is India's largest crude supplier.

Oman interested in Iranian gas

It is reported that export of Iranian gas to Oman was at the center of the talks held between the oil ministers of the two countries in the recent OPEC meeting.

Mr Mahmoud Zirakchianzadeh MD of the Iranian Offshore Oil Company said that Oman has presented a preliminary offer to buy gas from Iran and is expected to submit its final proposal on the issue next month, paving the way for the signing of an agreement by the end of the current Iranian year.

He added that in the talks held between the oil ministers of the two countries on the sidelines of the recent meeting of the Organization of Petroleum Exporting Countries in Abu Dhabi, emphasis was placed on making bilateral agreements, including the one on joint investment in the development of the Kish gas field, operational.

Mr Zirakchianzadeh said that "The Kish gas field is expected to yield 2 billion cubic feet of gas per day of which half will be exported to Oman, with the balance to be used inside the country. He said that using gas for electricity generation by Iran to be transferred to Oman was another proposal which could contribute to the development of the country's southern provinces.”

He added that swapping the Caspian Sea gas for gas exports from Iran's southern fields to Oman or direct transfer of Russian and Central Asian gas to that country is also under consideration.

EU steel users lobby oppose AD move on Chinese steel imports

It is reported that European steel users would face supply shortage if the European Union takes anti dumping measures against importing steel from China.

Mr Adrian Harris secretary general of European engineering association Orgalime in an exclusive interview with Xinhua said that "I am a little bit surprised by the decision."

Mr Harris said that a preliminary analysis made by his organization actually found no dumping in the case. He said "We are not against fair competition, but it should be fundamentally free and fair trade if there is no dumping. We will wait and see."

Mr Harris said the EU steel users need Chinese steel products to meet their demand since the European market is now under supplied, causing high prices for consumers and record profits for local steelmakers. He said "The market needs to be adequately supplied.”

According to Orgalime, the EU's engineering industry uses about two thirds of steel produced in Europe but has to rely on imports due to a lack of supply from local steelmakers. It said that the relatively cheap Chinese steel has helped EU industry to maintain competitiveness on the markets.

Earlier on Friday, the European Commission published its decision in the EU Official Journal to launch an anti dumping investigation into certain hot dipped metallic-coated iron or steel flat rolled products imported from China.

Orgalime represents national groups, including big steel consumers such as Siemens, ABB and Alcatel Lucent plus many smaller firms.

Chinese HRC export price continues climbing up

It is reported that Chinese hot rolled coil export prices, which have seen swift rise in the past two weeks continue to rise as steel makers raised their offers this week to capture the rise in domestic prices and also offset the risk of possible export tax change.

Export quotations for commercial HRC are prevailing at USD 660 per tonne to USD 670 per tonne FOB which compares with USD 640 per tonne to USD 650 per tonne FOB in last week. Some traders are complaining that parts of steel producers even are quoting USD 700 per tonne FOB citing high domestic price possible export tariff rate hike and less output.

Wuhan Steel saw an increase of USD 70 per tonne from November 2007 the highest among others. It is tagging at USD 675 per tonne CFR for re rolling HRC, pipe making grade material at USD 665 per tonne CFR and commodity grade at USD 655 per tonne CFR for shipments to South Korea.

Shagang is reported to be quoting at USD 650 per tonne CFR. While Jiuquan Steel even posts much higher at USD 700 per tonne CFR for delivery to South Korea in end January or early February shipment.

Chinese foreign trade in 11 months surpasses 2006 figure

Chinese General Administration of Customs announced that the value of China's foreign trade in the first 11 months of the year has surpassed that of the whole of 2006.

China's foreign trade value totaled USD 1.97 trillion during January to November 2007 up by 23.6% YoY and more than the USD 1.76 trillion for the whole of 2006. Combined exports in the first 11 months expanded by 26.1% YoY to USD 1.103 trillion while imports soared by 20.5% YoY to USD 865.4 billion. The trade widened by 52.2% YoY to USD 238.1 billion.

The EU remained China's biggest trade partner through November with bilateral trade of USD 322.7 billion followed by the United States with USD 276.2 billion and Japan with USD 213.8 billion.

In November alone, foreign trade rose by 23.9% YoY to USD 208.9 billion as exports jumped up by 22.8% YoY to USD 117.6 billion while imports climbed by 25.3% YoY to USD 91.3 billion. Trade surplus in November of USD 26.3 billion is slightly less than USD 27.05 billion in October.

The soaring trade surplus has flooded the economy with cash and increased pressure from the US and Europe for the yuan to appreciate further. The yuan has gained more than 10% since the US dollar link was scrapped in July 2005 and ended at 7.379.

China Shipping to buy four VLOCs for USD 470 million

China Shipping Development Co announced that it would buy four very large ore carriers from Chinese shipbuilders for a total of USD 470 million. Each vessel will have capacity of 300,000 DWT.

China Shipping Development Co said the purchase would be funded through bank loans and internal financial resources.

China Shipping Development Co also plans to order ten 57,300 DWT bulk cargo ships for a total of CNY 2.85 billion from China Shipping Industry (Jiangsu) Co Ltd, a wholly owned subsidiary of China Shipping (Group) Co, which also controls China Shipping Development. The bulk cargo ships, aimed at reinforcing the company's domination of coal transportation along the coast, will be delivered between 2011 and 2012, China Shipping said.

Wugang to spend CNY 10 billion to rebuild new E steel

It is reported that Wugang Group Corporation has formally approved Esteel’s technological transformation programs which is revised during "11th Five Year Plan" period E steel will spend CNY 10 billion on this technological transformation and the production scale will be double.

As per report this technological transformation project is implemented in three phases:
1. Mainly adjust the product structure
2. Mainly complete the adjustment of product structure
3. Mainly rebuild and support the large-scaled equipment

This technological transformation only introduced a small amount of key technologies and equipment.

At present the steel output of E steel has reached 2.5 million tonnes total assets is CNY 5.5 billion. By the end of "11th Five Year Plan" E steel company sales will be raised to CNY 25 billion from CNY 6.85 billion.

Benxi Steel announces Q1 pricing structure

Liaoning based Benxi Steel has announced EXW prices for the first quarter of 2008.

Some of the details of announcement as well as variation to its last pricing circular dated November 13th 2007 are as under

Hot rolled - Up by CNY 240 to CNY 350 per tonne
1. Q235 3.0mm HRC is priced at CNY 4100 per tonne
2. Q235 5.5 in 1190mm width HRC at CNY 3970 per tonne
3. Q235 5.5 in 1250mm width HRC at CNY 3870 per tonne

Cold Rolled – Up by CNY 370 per tonne
1. Q195 1.0mm in 1250 cased sheet at CNY 4620 per tonne

HDG - Up by CNY 230 per tonne for products produced by No 1 mill and CNY 180 per tonne for those produced by No 2 mill
1. ST01Z 1.0mm in 1250 width HDG is offered at CNY 4800 per tonne

Color-Coated - Unchanged.
1. TDC51D 0.47mm in 1250 PPGI is at CNY 6000 per tonne

Prices listed above are EXCLUSIVE of 17% VAT, effective as of December 14th 2007.

China to raise thermal coal prices in 2008

According to a recent coal industry summit held in Hebei Province, China will increase the coal price in 2008 due to a series of new policies on safety mining and environmental protection, the production cost in the coal industry has increased significantly.

As per report, China five power producers, China Huaneng Group, China Guodian Corporation, China Power Investment Corporation, China Huadian Corporation and China Datang Corporation are still in talks for a more reasonable coal price.

The country's power industries have called for the government set electricity prices to be pegged to coal prices. However, analysts say the proposal is not likely to be realized because of the rising consumer price index.

Chinese ferrochrome import down in October

According to China Customs China imported 93,634 tonnes of ferrochrome in October 2007 down by 33.6%MoM than last month. China's ferrochrome import totaled some 1.1 million tonnes from January to October 2007 up by 3.1 times than the same time of last year.

On the other hand China exported 38,507 tonnes of ferrochrome in October up by 67.3%MoM than last month. China's ferrochrome export totaled 283,140 tonnes in the first 10 months increasing by 12 times than the same time of last year.

Tianjin Port traffic in 11 months up by 23% YoY

It is reported that From January to November 2007 Tianjin Port which mainly handles ores, coal, crude oil, iron and steel and so on as the main materials, had a throughput of 291.568 million tonnes up by 22.7% YoY. In addition it handled 6.489,000 containers up by 20.4% YoY.

As per report, 156.625 million tonnes of cargo was exported during this period, up by 21.9% YoY and 4.819 million containers were shipped outside up by 23.4% YoY.

During the first eleven months, Tianjin Port had a throughput of 48.199 million tonnes of metal ores up by 19% YoY, 70.893 million tonnes of coal up by 35.5% YoY, 25.754 million tonnes of crude oil up by 20.2% YoY and 30.652 million tonnes of steel up by 49.4% YoY.

Chinese seamless pipes export to Taiwan down by 15% in November

YIEH reported that Taiwan’s import of Chinese seamless pipe has reduced by 15% to 5,142 tonnes from it was 6,054 tonnes in October 2007.

China’s has raised the quoted prices by 3% since October 2007. Besides, the inventories held by Taiwan’s trader are still at high levels.

Taiwan’s import of pipes from Japan also down, as the quantity was 3,370 tonnes in November 2007 reducing by 11.5% compared to it was 3,808 tonnes in October 2007.

Western Mining to invest in lead zinc ore project in Qinghai

It is reported that China's Western Mining Co Ltd will invest CNY 477.5 million in a lead zinc ore project in Qinghai in southwest China.

China's Western Mining Co Ltd said that it will invest CNY 236.3 million in the first phase of the project with CNY 241.1 million budgeted for the second phase.

In addition, Western Mining also said it will invest CNY 51 million to set up a joint venture with Beijing Yuguang Gold & Lead Co Ltd for a wet lead smelting project. The wet lead project will have annual capacity of 100,000 tonnes and involve total investment of CNY 417.4 million.

It said its board also approved the sale of copper ore exploration rights in Inner Mongolia for CNY 457.6 million.

NanTong Zhongji uses Baogang’s SS for tank containers

It is reported that the world's largest stainless steel tank container enterprise NanTong Zhongji recently started using Baogang’s 316L stainless steel replacing the imported products.

After Baosteel stainless steel branch got this market demand, it began to research and develops this new product at the beginning of March this year, to be successful in just over a month's time. 316L stainless steel’s mechanical properties, welding performance can be comparable to that of imported products and the molding performance is better than that of imported product.

Envelope is the key component of mobile tank container and thus stainless steel is required to have high strength and high surface quality so that it can bear high temperature requirements. The annual demand is estimated at 5,000 tonnes.

NanTong Zhongji is the backbone enterprise of CIMC which is the leading enterprise for global container manufacture. NanTong Zhongji mainly produce tank container and storage and transportation pressure vessel, Its container’s design and throughput are No 1 in the world accounts for more than 50% in global market.

Shenhua Energy's coal sales increase in November

It is reported that China Shenhua Energy Company the leading integrated coal based energy Company a coal sales of 19.2 million tonnes for November up by 10% from October and 34.3% higher than the monthly average for year 2006.

According to company data Shenhua Energy produced 13.2 million tonnes of commercial coal 15.8% more than the 2006 monthly average and of the 19.2 million tonnes of coal sold in November 2007 2.2 million tonnes was for export market 10% higher than corresponding monthly average of 2006 also contrast to a drop of 15% in October 2007.

As per report Shenhua have reached some coal sales agreements with downstream power generators, though the contracts remain to be announced. Sources say the contract prices Shenhua inked with these downstream users may be higher than other coal producers.

Shenhua, which focuses on coal and power businesses, has long seen it’s realized coal prices some CNY 100 per tonne lower than prevailing market prices, despite the high quality of its major product steam coal.

EBRD to part fund Severstal energy efficiency drive

The European Bank for Reconstruction and Development is, through a EUR 300 million long term loan, supporting a major drive by Severstal to cut the energy consumption of its Russian steelmaking operations.

The Bank remains the lender of record for the full EUR 300 million under an EBRD A/B loan structure, syndicating EUR 150 million for a 7 year facility. The mandated lead arrangers of this B loan are ING Bank N.V., CALYON and Raiffeisen Zentralbank Oesterreich AG. The EBRD has kept the remaining EUR 150 million on its own books as the A portion of the loan, which has a 10 year maturity.

The project, which has a total estimated cost of EUR 700 million, will have the added environmental benefit of reducing the group’s CO2 emissions by around 900,000 tonnes a year. It will help Severstal to reduce its annual primary energy consumption by 5% to 10 %.

Mr Jean Lemierre president of EBRD during loan signing ceremony in Moscow said that “This is one of the largest energy efficiency investment program ever undertaken by an industrial company anywhere and the EBRD hopes it will send a clear signal to other Russian energy intensive companies industry that this is not only a crucial issue CEOs should focus on, but also that accelerating energy efficiency measures has a high return and is commercially viable.”

Mr Alexey Mordashov CEO of Severstal said that "I am delighted that Severstal is working closely with the ERBD to increase its investments in energy efficiency. The ERBD loan recognizes our efforts in these key areas and provides us with the impetus to reduce our energy consumption."

ArcelorMittal inks pact for a steel plant in Tver region of Russia - Report

RIA Novosti reported that ArcelorMittal, the world's largest steel producer intends to build a metals plant near Tver in central Russia.

Mr Andrei Loshakov deputy governor of Tver Region's said "A corresponding agreement was signed recently between the investor company and the region's administration. The new facility will produce 1 million tonnes of steel per year. The project's first stage will require about USD 100 million in investment. A feasibility study for the second stage will be started in the near future."

Mr Loshakov said work at the construction site near Tver, located 150 kilometer northwest of Moscow, would begin in the second quarter of 2008 and that the facility would be put into operation in early 2010. He said that “The metals factory will create 200 new jobs and indirectly employ an additional 400 staff. The factory will be a modern, hi tech and environmentally friendly enterprise."

Mechel acquires 49% of Toplofikatsia Rousse in Bulgaria

Mechel announced that it has acquired 49% of the shares of Toplofikatsia Rousse JSC located at Rousse in the Republic of Bulgaria.

Following the approval by the Post Privatization Control Agency of Bulgaria and Antimonopoly Committee of Bulgaria of Mechel’s right to acquire 49% of the shares of TPP Rousse, Mechel’s subsidiary, Mechel International Holdings, acquired 49% of the shares of TPP “Rousse” from its 100% owner, Holding Slovenske elektrarne doo of Slovenia. The transaction amount was approximately EUR 50.2 million.

Mr Alexey Ivanushkin CEO of Mechel OAO said that “Mechel is the first Russian company to make significant investments in a power generating asset in Europe, a significant step that confirms Mechel’s intentions to continue developing its power segment.”

He said that “Due to a natural gas deficit and rising prices for energy resources, there is significant opportunity for steam coal consumption in Eastern Europe. As such, coal fired power plants are becoming more important. At a time of tight steam coal supply, Mechel’s becoming a shareholder of the “Rousse” power plant secures the stability of coal deliveries to and the vitality of the power plant itself.”

He added that “In addition, the acquisition of a large stake in a power plant in Bulgaria opens new markets for us to sell our steam coal and new potential markets for selling electric and heat energy produced by TPP Rousse to third parties. We are also interested in further expanding our presence in the growing Bulgarian energy market.”

BMZ steel production in 11 months up by 5.3% YoY

It is reported that state owned Belarusian Metallurgical Plant based at Zhlobin in central Belarus has produced 2.08 million tonnes of steel in January to November 2007 period up by 5.3% YoY.

BMZ produced 1.7 million tonnes of rolled products in the eleven month period up by 9% YoY. Its hardware products output in the reported period rose 19.2% YoY to 261,100 tonnes.

BMZ's output in terms of value rose by 8.1% YoY to BYR 2.7 trillion.

BMZ, which was set up in 1984, exports about 85% of its production and non CIS countries account for more than 70% of its exports.

Severstal not to become gold mining company

Mr Alexei Mordashev CEO of Severstal recently clarified that it is not planning to become a gold mining company.

He noted that Severstal could consolidate gold mining assets in order to boost its capitalization adding that the process would take up to five years.

He also pointed out that Severstal's management was hoping to form a new company and either sell it or make an IPO at a later time.

Hyundai to build car factory in St Petersburg

RIA Novosti reported that South Korean auto giant Hyundai has signed a deal with St Petersburg authorities to build a car factory in the northwest Russian city.

The report cited Ms Natalia Kutobayeva a spokeswoman for the governor said that the agreement was signed during an official visit by St Petersburg governor Ms Valentina Matviyenko to Seoul, but declined to give specifics on the deal.

Earlier, authorities of the Leningrad Region which surrounds Russia's second largest city said the South Korean company could select a site by the end of the year to build a USD 400 million factory with capacity of 100,000 to 200,000 cars per year.

Metinvest completes sales division restructuring

Ukrainian Journal cited Mr Andriy Parkhomchuk sales director as saying that Metinvest Holding, the management firm of the Metinvest steel group, has completed the restructuring of its sales division and re branding of its sales outlets.

He said the sales service of the steel and rolled products division consists of a group of companies, each of which is responsible for a certain market.

Komatsu to invest USD 60 million in Russian plant

Interfax reported that Japan's Komatsu a leading manufacturer of construction and road machinery plans to invest JPY 6.9 billion in the construction of a plant in Russia to make specialized machinery.

The plant, to be built in Yaroslavl will have capacity to produce 10,000 units of machinery per year, including 3,000 excavators and 7,000 loaders. The plant will open in June 2010.

It was reported earlier that the company plans to build a plant in Russia with capacity of 1,000 excavators per year at a cost of USD 50 million. Komatsu had planned to set up production of heavy excavators with operating weight of 20 tonnes to 40 tonnes.

Komatsu shipped 204 units of machinery to Russia in 2006, including 115 excavators. These figures are expected to more than double to 540 and 318 respectively in 2007. It's turnover in Russia is estimated at USD 130 million.

Ukrainian steel makers to see huge cost pressures

Ukrainian Journal quoted Mr Vasyl Kharakhulakh head of industry association Metallurgprom as saying that some Ukrainian steel companies might operate at a loss in Q1 2008 due to higher energy prices, shortages of coke and an increase in prices for iron ore commodities.

Uralmash to supply a heavy duty crane to Nizhniy Tagil

It is reported that Uralmash Machine Building Corporation has signed an agreement with Nizhniy Tagil Iron & Steel Works regarding the delivery of a casting crane capable of lifting up to 225 tonnes. The delivery is expected to take place in the fourth quarter of 2008.

The crane is to be designed by Uralmash Engineering and to be produced at Uralmashzavod. The weight of the equipment is estimated at 290 tonnes.

The plant is also making two drums for Nizhniy Tagil Iron & Steel Works at the moment; the contract to this extent was signed in August 2007 and the shipment of the products has been scheduled for March 2008.

Russian oil output in 10 months grows at 2.4% YoY

RIA Novosti reported that oil output in Russia increased by 2.4%YoY in January to October 2007 to 408.9 million tonnes.

The State Statistics Service, Rosstat said crude sales on the domestic market grew 3.8% in the reporting period to 188.4 million tonnes and exports were up 3.7% to 215.7 million tonnes.

Rosstat said in October, oil output not including gas condensate totaled 9.806 million barrel per day in Russia and 31.065 million barrel per day in OPEC countries, including 2.245 million barrel per day in Iraq and 8.620 million barrel per day in Saudi Arabia.