Mr Paswan calls for expediting allocation of iron ore mines to PSUs

It is reported that steel ministry has asked Chhattisgarh government to expedite allocation of iron ore deposits in Bailadila mines to public sector undertakings Steel Authority of India Limited, National Mineral Development Corporation and Rashtriya Ispat Nigam Limited recently.

Mr Ram Vilas Paswan union steel minister said that "During my meeting with Chhattisgarh chief minister, I asked him to expedite allocation of deposit IV of Bailadila mines to enable SAIL, RINL and NMDC build a 4 million tonnes steel plant at an expenditure of INR 16,000 crore."

RINL eying iron ore alliance in Canada

It is reported that Rashtriya Ispat Nigam Limited has put in a bid to develop iron ore assets in Canada, is estimated to hold 2.4 billion tonne of iron ore.

Mr PK Bishnoi CMD of RINL said “A Canadian company has sought Expression of Interest for an iron ore deposit in that country and RINL has applied for it.”

However Mr Bishnoi added that “It is too early to comment on whether we will develop it on our own or join hands with another partner for mining and development.”

He said that “Our captive port, Gangavaram, would be ready by May. If we manage to get the reserve, it would be cheaper for us to transport the ore from Canada to Visakhapatnam than to get it from Jharkhand.

He said that RINL had applied to the Orissa and Jharkhand governments for captive iron ore mine for its steel plant, but they were rejected.

He said “Iron ore is crucial for the plant which is undergoing first phase of capacity expansion from 3.5 million tonne to 6.3 million tonne by 2009.”

India may import 5 million tonnes steel in 2008 – Mr Muthuraman

BS reported that Mr B Muthuraman MD of TATA Steel, while addressing the 2nd Asian Mining Congress, said that India is likely to import around 5 million tonnes of steel in 2008.

He added that 5 million tonne of steel would translate to around INR 10,000 crore and this would only increase. Over the next 3 years, India would have to import 10 million tonne of steel.

Mr Muthuraman said that, to cater to the growing consumption of steel, India should add 5 million tonne to 10 million tonne of capacity each year either through Greenfield or brownfield expansion, which is not happening due to land acquisition problems and lack of a transparent mineral policy.

He said “Apart from the problem of land acquisition which by itself is enormous in India, we simply don’t have a transparent mineral policy. What is the method of allocation, what principles are to be used, a lack of speed, and the situation is much more complicated and serious than what most people think.”

Foundation stone laid for NMDC Bailadila XI B iron ore deposit

It is reported that Mr Paswan union steel minister has recently laid the foundation stone for National Mineral Development Corporation Bailadila XI B iron ore deposit in Chattisgarh.

Bailadila XI B has an estimated reserve of 114.69 million tonnes with a mining capacity of 7 million tonnes per annum. The deposit would be developed at an expenditure of about INR 468 crore and is expected to be commissioned by September 2009.

Vowing to make NMDC the biggest miner in the world, Mr Paswan pointed out that NMDC was executing major capacity expansion plans worth INR 18,000 crore and was all set to increase its production capacity to 35 million tonnes as against about 30 million tonnes in 2007. He pointed out that steel ministry is envisaging an investment of about INR 300,000 crore in the next 3 years and about INR 850,000 crore by 2020.

Mr Rana Som CMD of NMDC said that it would be able to mine 5 million tonnes iron ore more than it did last year by up scaling operations in the existing mines, besides commencing mining in the revenue land in newly allocated Kumaraswamy mines in Karnataka.

Mr Som pointed out that NMDC would invest about INR 400 crore in 2008 out of its total capital outlay of about INR 18,000 crore for renewal and replacement of existing mining machinery. He added that "Our scale of investment would be much higher in the coming 3 years when we will go full throttle to expand our capacity."

NMDC would spend about INR 115 crore this year for corporate social responsibility under which it has adopted 38 villages to be converted into model ones, besides initiating programs like Grameen Pusti Yojana.

Import duty on ferronickel may cut in 2008 Budget

ET reported that union finance ministry is considering cutting import duties on ferronickel from present 5% to 2% in Budget for 2008.

The report cited an official of union finance ministry as saying that “Duty cut on ferroalloy has become imminent as the Budget 2007 had created distortions in import duty of raw material used by the stainless steel industry. The reduction would bring duty on ferroalloy at par with unwrought nickel, nickel oxide sinter and other intermediate products of nickel. This would encourage stainless steel production and give a boost to the utensil industry.”

The official said that the move would rationalize the import duty structure for the product segment and facilitate imports of ferronickel, which is not produced in the country and entire requirement is imported.

He added that while duty rationalization would cheer stainless steel consumers, the industry is expected to be only partially satisfied. The stainless steel industry has demanded a complete withdrawal of duty on nickel.

HZL cuts zinc prices by 5.6%

Hindustan Zinc Limited announced that it has reduced its zinc prices by 5.6% or INR 6,300 per tonne to INR 105,200 (USD 2,677) effective immediately.

HZL in a statement that it increased its lead prices by 1.7% or INR 2,000 to INR 117,300 per tonne.

Sterlite Energy to invest USD 8.5 billion in power sector

BS reported that mining and metals major Vedanta Group’s Sterlite Energy is planning to invest over USD 8.5 billion to generate 10,000 MW of power through coal based plants in Orissa and Chattisgarh.

Mr Anil Agarwal of Vedanta Group said that “Vedanta is planning only coal based power projects, but depending on the availability of other fuels, it would explore power plants fuelled by alternative energy sources.”

He said that “Sterlite Energy will make an initial public offer shortly to fund these projects. There would also be a pre IPO placement. The projects will be funded through 70:30 debt equity. Our bankers are working out the details.”

Vedanta plans to commission units for 4,400 MW of power in Orissa and 5,600 MW in Chattisgarh. It produces about 2,800 MW for captive consumption for its mining and metal ventures. It is also setting up a 2,400 MW plant at Jharsuguda in Orissa which is expected to start commercial production in 2008-09. It is planned to increase capacity by about 2,000 mw in two years and commercial production of 9,600 mw by 2012. The power plants in Chattisgarh will come up at Korba.

Mr Tarun Jain director of Vedanta said that it has been allotted coal mines with reserves of 320 million tonnes to ensure fuel availability for the power projects.

SC concerned over handling of fires in coal mines

It is reported that India’s Supreme Court, while hearing a PIL filed in 1997 highlighting that underground fires in the coal mines of Jharia and Raniganj were spreading and may lead to disasters, has expressed serious concern over the progress in handling the likely consequences of the fires and subsidence of earth in the coal mining areas of Jharkhand and West Bengal.

SC Bench, headed by Chief Justice KG Balakrishnan, noted that despite reports by the committee appointed by the apex court in respect of mines under the control of Bharat Coking Coals Ltd and Eastern Coalfields Ltd, no serious steps have been taken either for relief and rehabilitation of residents in the affected area or for controlling the fires.

The bench expressed displeasure that neither Jharkhand nor West Bengal government had responded to the Master Plan prepared by the Coal India Limited to address the concerns arising out of the fires in the mines.

The Bench asked additional solicitor general Mr Vikas Singh to appraise it about the center’s view on the suggestion within 8 weeks. It also asked the additional solicitor general to respond to concerns about the safety of railway track and oil pipelines passing near to these areas.

The counsel, who was assisting the court as an amicus curiae in the matter, suggested constituting a high level committee involving the director general mines safety, chairmen of BCCL and ECL along with technical experts.

Simplex to foray into thermal power production

It is reported that Kolkata based Simplex Infrastructures has put on hold its intentions to enter standalone mining projects and instead is foraying into thermal power production through a JV. It is pinning its hopes on bagging a 1,000 MW thermal power project on a build own and transfer basis in Chhattisgarh.

Mr NK Kakani executive director of Simplex Infrastructures Limited said that “This will pave the way for us to enter coal mining, as mining by itself is a capital intensive proposition.”

Simplex has a MoU with Thailand based Banpu Public Company for contract mining in India.

With an order book of INR 9,000 crore, Simplex is also sharpening its focus on providing rigs on hire for onshore oil exploration. It recently acquired an INR 45 crore rig from China, whose services have been placed at the disposal of Oil India in Assam on a 2 year contract for USD 16,000 a day. It is also in talks with other oil exploration companies such as Reliance and Cairn India to offer similar services in Rajasthan, Orissa and Andhra Pradesh.

Teesta project to be commissioned by January end

BL reported that 510 MW NHPC’s Teesta Stage V hydro power project at Dikchu in Sikkim is all set to be commissioned by January 2008 end. The project is estimated to cost INR 2,198.04 crore. Once operational, Teesta Stage V will be the first mega hydel power project to be fully commissioned in the state.

Mr BK Sharma executive director of NHPC Teesta Stage V said that the first phase of the project will begin tentatively by the third week of January 2008 with the commissioning of 1 of the 3 turbine units. Each unit has a capacity of 170 MW.

Mr Chamling chief minister of Sikkim recently visited the project site. His first stop was at dam site area at Dikchu village in East Sikkim, where a 95 metre high concrete gravity dam has been build to tap the river water. A 17.6 kilometer head race tunnel will carry the water from the dam reservoir to the underground power house at Dipudara near Sirwani in east Sikkim.

Cochin Shipyard delivers PSV to Deep Sea

BL reported that Cochin Shipyard Limited has delivered a platform supply vessel ship to Deep Sea Supply of Norway. This is the 5th in a series of 8 ships being built for Deep Sea.

This platform supply vessel is of the popular UT 755 L design for the offshore industry. It is for transport of deck cargo, pipes, liquid cargo, cement and barite as well as for uploading to rigs and production platforms, pipe laying barges etc. They are the workhorse of the offshore oil field industry, which act as a lifeline carrying all operational supplies and stores to far offshore installations.

As the offshore industry moves into deeper waters, the demand for such advanced vessels is expected to grow even faster. These ships have been designed by Rolls Royce Ship Technology Group and is built and classified under the most stringent rules and regulations of Det Norske Veritas and is classed for unmanned engine room and dynamic positioning grade. The vessel also satisfies the clean notation of DNV which signifies high standards of environmental safety.

Cochin Shipyard is also constructing 21 more similar ships for European and American clients valued at over INR 2,000 crore. Besides these projects, an air defence ship for the Indian Navy which is also currently under construction.

Overseas firms eying berth development at Paradip Port

It is reported that China’s Ningbo Port Group Limited and Ras Al Khaimah based port operator Saqr Port Authority are vying to develop and operate coal and iron ore berths at Paradip Port in Orissa. As per report, Ningbo has teamed up with Hong Kong based Great Harvest Holdings Limited and India’s Monnet Ispat Limited, while Saqr has partnered Emirates Trading Agency to bid for the 2 projects.

The other bidders include miner Rio Tinto India Private Limited, Gammon Infrastructure Projects Limited, MMTC Limited Noble Group, Larsen & Toubro Limited, Lanco Infratech Limited Lanco Kondapalli Power Private Limited Gulftainer Co Limited, Mundra Port & SEZ Limited, Essar Shipping Limited Essar Shipping & Logistics Limited and Sical Logistics Limited Orissa Stevedores Limited. L&T and TM International Logistics team has bid only for the coal terminal, while Sical Logistics Orissa Stevedores team is in the fray for the iron ore berth. The remaining entities are bidding for both the berths.

Mr K Raghuramaiah chairman of Paradip Port said that the Ningbo consortium and Saqr ETA are among 8 entities shortlisted for each of the two projects .He added that “We will shortly invite price bids from the shortlisted bidders.”

Ningbo’s application will have to sail past the union home ministry as Chinese firms are prohibited from bidding for Indian port projects. Ningbo operates China’s second largest port, in terms of cargo handled, after Shanghai.

Paradip Port is planning to build an INR 387 crore, 10 million tonne capacity berth for handling imported coking coal used for firing steel plants and another INR 505 crore, 10 million tonnes capacity berth for handling iron ore exported from India. When fully operational, the 2 berths will have deep drafts of 16 meter capable of handling ships with a cargo carrying capacity of 125,000 tonnes initially and later 185,000 tonnes.

MMTC seeking partners for coal and power SPVs

It is reported that MMTC Limited is seeking a JV partner in a special purpose vehicle for captive mining of coal and setting up a power plant.

As per report, MMTC’s holding in the SPV will be up to 26%.

The SPV will identify pit head coal blocs in eastern states of Jharkhand, Orissa and Chattisgarh. It has invited expression of interest for joining the special purpose vehicle.

Steel Strips wins huge supply order from Peugeot

Automotive wheel rims manufacturer Steel Strips Wheels Limited has won an order worth INR 750 million from French car manufacturer PSA Peugeot Citroen.

Steel Strips Wheels will supply 1.375 million rims to PSA Peugeot over 5 years.

The rims will be manufactured at its new upcoming plant at Oragadam near Chennai in Tamil Nadu, which is likely to start trial production in 1st quarter of year 2008-09.

PSA Peugeot Citroen, France is the second largest manufacturer of cars in Europe and the leading manufacturer of light commercial vehicles.

HCC receives LOA for LPG cavern storage tank project

Hindustan Construction Company has received a letter of acceptance from Indian Strategic Petroleum Reserves for execution of civil works for underground rock cavern for strategic storage of crude oil project at Visakhapatnam in Andhra Pradesh.
The value of the contract is INR 375.38 crore and the project is to be completed within 36 months from the date of issue of LOA.

Hot band spot prices moving towards record levels

SteelBenchmarker reported that the US hot rolled band spot price for January 14th 2007 surged by 6.1% to USD 659 per ton on FOB basis after 5th consecutive rises, world export HRB price rise by 5.3% to USD 633 per tonne FOB the port of export for the third consecutive time, Chinese HRB ex works price rose by 3.4% to USD 543 per tonne and the Western European HRB price up by 4.7% to USD 718 per tonne ex works for the second consecutive time.

USA
USD 659 per ton FOB the mill
Up by USD 38 per ton from USD 621 three weeks ago
Up by USD 99 per ton from low of USD 560 on August 13th 2007
Up by USD 29 per ton from recent high of USD 630 on April 9th 2007

China
USD 543 per tonne ex works
Up by USD 18 per tonne from USD 525 three weeks ago
Up by USD 73 per tonne from low of USD 470 on October 22nd 2007
Up by USD 56 per ton from high of USD 487 on September 10th 2007

Western Europe
USD 718 per tonne ex works
Up by USD 32 per tonne from USD 686 three weeks ago
Up by USD 55 per tonne from low of USD 663 on July 23rd 2007
Up by USD 22 per tonne from high of USD 696 on June 11th 2007

World Export Price
USD 633 per tonne FOB the port of export
Up by USD 32 per tonne versus USD 601 three weeks ago
Up by USD 83 per tonne from low of USD 550 on July 23rd 2007
Up by USD 37 per tonne from high of USD 596 on March 26th 2007

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

Anglo American offers USD 5.5 billion for 2 MMX iron assets in Brazil

Anglo American Plc announced that it has entered discussions to buy control of two Brazilian iron ore projects owned by MMX Mineracao for about USD 5.5 billion. The company said it is also in discussions with Eike Batista, the controlling shareholder of MMX, to acquire Batista's 63.6% stake in a new company or Newco, which will be demerged from MMX.

Under the proposal, Anglo American will pay about USD 5.5 billion or about USD 361.12 per share for Newco, as well as royalty payments to MMX beginning in 2025 for the Minas-Rio project and 2023 for the Amapá project.

The demerged company will own MMX's current 51% interest in the Minas-Rio iron ore project and 70% interest in the Amapá iron ore project.

MMX's logistics business, LLX Logística S.A., will also be demerged from MMX as part of the same reorganization, but will not be included in the transaction with Anglo American.

Ms Cynthia Carroll CEO of Anglo American said “I am delighted that Mr Batista has agreed to Anglo American's proposed price for his shares in Newco and that we are now in exclusive talks to acquire the Minas-Rio and Amapá iron ore projects. These two projects are a great strategic fit for Anglo American and, together with the planned Kumba expansions, will significantly increase our participation in the seaborne iron ore market to approximately 150Mtpa by 2017.”

After completion of this transaction, Anglo American has committed to extend an offer to the minority shareholders of Newco at the same price per share offered to Batista. If successfully completed, Anglo American will own 100% of the Minas-Rio project and, 70% of the Amapá project and 49% of LLX Minas-Rio, the owner of the Port of Açu.

The transaction is subject to a number of terms and conditions, including the negotiation of the transaction documents, customary regulatory approvals and completion of the reorganization of MMX.

The Minas-Rio iron ore project is located in the Minas Gerais state in Brazil. It will comprise a mine and beneficiation plant producing high-grade pellet feed. The project is due to begin production in the first half of 2010 with potential production of 26.5 million tonnes per annum from the first pipeline. MMX currently owns 51% of the Minas-Rio project and Anglo American acquired a 49% stake in the project in May 2007, including a 49% stake in LLX Minas-Rio, the owner of the Port of Açu.

The Amapá iron ore project is located in the Amapá state in Northern Brazil. The construction of the Amapá project was recently completed and production was started in December 2007. It has annual capacity of 6.5 million tons per annum of iron ore. MMX currently owns 70% of the Amapá project and Cleveland Cliffs Inc. owns 30%.

Mr Muneoka appointed as president of Nippon Steel

Nippon Steel Corp formally announced that Mr Shoji Muneoka vice president will become president from April 1st 2008 thus replacing Mr Akio Mimura who will assume the post of chairman.

It said that “The reshuffle was decided at the firm's board meeting earlier in the day.”

Nippon Steel Corp was created from the merger between Fuji Iron & Steel Co and Yawata Iron & Steel Co in 1970.

Mr Muneoka will become the first among Nippon Steel officials who joined the company after the merger to assume the presidency. Mr Muneoka has long worked in marketing and is known to be skilled in price bargaining with automakers.

BDI sinks to 6 month low after record drop

Reuters reported that the Baltic Exchange's freight index for global dry commodities trade suffered on Thursday its sharpest ever one day fall, trouncing Wednesday's record drop and fuelling fears of an impending US recession.

The London based exchange said the index, which monitors major trade routes for coal, iron ore, cement and soft commodities such as grains and sugar, sank by 441 points or 6.41% to 6,472, a six month low.
It has sunk by 37% since a record high in November 2007, which was mostly spurred on by rapid industrialization in China and India and robust world economic growth. Since then, financial markets have taken a severe knock as worries over the health of the US economy have deepened.

Analysts have pinned the dramatic decline from record highs hit in November on short term factors such as a decline in global port congestion and loading disruption of commodities such as iron ore in exporting countries such as Brazil. Vale has cancelled 5 million tonnes, 30 large cargoes, of iron ore shipments to China in the first quarter.

The index, established in 1985 and widely watched by economists and traders as a gauge of global economic activity, has seen four record one day falls in just a week.

EU threatens 50,000 jobs with CO2 plan - German steelmakers

German steel industry has warned of huge job losses if the European Commission went ahead with a new emissions trading scheme in its climate protection drive.

Mr Dieter Ameling head of the industry foundation said that "If by 2020 all emission rights must be bought at auction, at least 50,000 jobs in the German steel industry are in danger."

Mr Ameling said that "The EU program would make German and European manufacturers the clear losers in the global steel industry. If the law on certificate trading for carbon dioxide emissions is introduced as planned by Brussels, no steel manufacturer will invest in Europe."

He said “The special treatment should apply to the aluminum, cement, paper pulp and base chemical industries and, perhaps, steel.”

Mr Guenter Verheugen EU industry commissioner had called in November 2007 for special treatment for Europe's energy guzzling core sectors over their carbon dioxide emissions to protect their competitiveness.

According to Frankfurter Allgemeine Zeitung report, Mr Ekkehard Schulz CEO of ThyssenKrupp AG's and other representatives of Germany's steel industry plan to meet with Mr Verheugen on January 21st 2008 to lobby against plans for new emissions trading rules.

European Commission plans a new emissions trading system as part of the bloc's commitment to cut greenhouse gases by 20% by 2020. By that date, all free emissions certificates will be phased out. The commission is due to present a package of legislative measures on January 23rd in this regard.

Steel laden MV Hofeng No 7 sinks off Batanes Island near Taiwan

Reuters reported that Philippine authorities are searching for 11 sailors missing after their cargo ship sank in stormy weather off the northern coast.

The report quoted a spokesman for the coast guard as saying that 8 people had been plucked from choppy waters off Batanes Island near Taiwan a few hours after the ship sank on Wednesday.

Steel laden MV Hofeng No 7 was on its way to Malaysia from China and was carrying 19 crews when huge waves, strong winds and rain caused it to list and sink.

Burgon Tool Steel acquires Kloster Steel Corp

Burgon Tool Steel Co Inc announced the acquisition of Kloster Steel Corp, which is based at Chicago in Illinois state of US. The companies will combine effective January 1st 2008 and Kloster Steel will adopt the Burgon brand name effective immediately, operating as the Midwest Division of Burgon Tool Steel.

Kloster Steel enjoys an outstanding reputation having served the upper Midwest region in US with the highest quality tool steel products since 1926.

Mr Gerry Sorensen president of Kloster Steel said “We at Kloster Steel are truly excited about becoming part of the Burgon Tool Steel family. Burgon takes care of their customers with the same eye toward quality and customer service that have been the benchmarks of Kloster for many years. Joining together will allow us to provide our loyal customers throughout the Midwest with an even finer level of service on their tool steel requirements."

Highveld wraps up Rand Carbide sale

Highveld Steel & Vanadium announced tat it has agreed to sell its Rand Carbide division to Silicon Smelters for ZAR 300 million. The effective date of the transaction would be February 1st 2008.

Rand Carbine, which produced ferrosilicon, electrically calcined anthracite and char, was seen as a non core business.

Rand Carbine had been bought in 1978 and held a 50% share of the local market of ferrosilicon. It also held a 10% share in both the electrically calcined anthracite and char markets. The global market share of all these products was insignificant, the company previously stated.

Kumho-Asiana wins bid for Korea Express

It is reported that Kumho Asiana Group won the bidding to buy a controlling stake in South Korea’s largest logistics company Korea Express Co.

According to the officials at the Seoul Central District Court, Kumho-Asiana’s Asiana Airlines Inc and Daewoo Engineering & Construction Co., which made a joint bid to purchase 24 million new shares of Korea Express, valued at some USD 2.7 billion, were chosen from among four bidders. The 24 million new shares are equivalent to 60% of enlarged capital in Korea Express.

Both the court and Kumho-Asiana declined to say how much the preferred bidder had bid.

Under the proposed timetable, Kumho-Asiana plans to sign a memorandum of understanding to purchase the stake in Korea Express on January 25th 2008. After conducting a due diligence by February 15th 2008, Kumho-Asiana is required to ink a formal deal on February 22nd 2008.

Korea Express has been under court receivership since November 2001, when it failed to pay debts in the wake of 1997-98 Asian financial crisis.

Shipbuilder STX Group came second in the auction. Hanjin Group, which owns Korea Air Co and Hyundai Heavy Industries Co had also submitted separate final bids.

According to the Fair Trade Commission’s Web site, Kumho-Asiana is Korea’s seventh largest conglomerate with assets of KWR 22.8 trillion (USD 24.1 billion).

Zinifex’ offer for Allegiance unconditional

Zinifex Australia Limited, wholly owned subsidiary of Zinifex Limited today declared its offer for Allegiance Mining NL unconditional following receipt of FIRB approval.

The release added tat “In accordance with the terms of the Offer, Allegiance shareholders will now be paid within five business days of Zinifex receiving a valid acceptance.”

Allegiance shareholders accepting now will receive payment of AUD 0.90 cash per share. If Zinifex obtains a relevant interest in 30%, or the Board of Allegiance recommends the Offer, an additional AUD 0.10 per share will be paid within five business days of that occurring.

Mr Andrew Michelmore CEO elect of Zinifex said the certainty of Zinifex’s all cash Offer is particularly attractive in the current volatile and uncertain market. He said “With our offer now declared unconditional, accepting shareholders will have the additional benefit of being paid within five business days.

He added that “In the absence of the Allegiance Board explaining how they intend to match the value of Zinifex’s Offer, the choice is to accept certain cash payment with the Zinifex Offer or an indefinite wait for Allegiance’s blue sky alternative.”

ThyssenKrupp Industrieservice opens new location in Rostock

ThyssenKrupp Industrieservice, one of the largest industrial service providers in Germany and Europe, opened a new location in Rostock.

While the customers in Mecklenburg-Vorpommern so far had been cared by the Hamburg division, they profit now from the local operational readiness level of their service teams directly in the region.

Aços Groth plans new unit startup in late 2008

BNamericas cited Mr João Luis Groth industrial director as saying that Brazilian steel welded tube and products maker Aços Groth plans to start operations at its new unit in São Paulo state in November or December of 2008.

Mr Groth said "We expect construction works to begin in February or March. The facility is expected to operate at full capacity at the end of 2009. He said that the company already operates two units in São Paulo state's Guarulhos city with installed capacity of 6,000 tonne per month and 3,000 tonnes per month based on one 8 hour working shift per day.

Mr Groth said "The region is growing quickly and has strong potential. We will be closer to our existing clients, and as a result, our transport costs will decline, adding that his company sells to the sugar, ethanol and auto parts industries among others.

Aços Groth was founded in 1987 and manufactures products with steel supplied by CSN and Cosipa among other Brazilian steelmakers.

AK Steel increases prices for carbon steels by USD 30 per ton

AK Steel Holding Corporation will increase spot market prices for its carbon steel products by USD 30 a tonne with effect from March 1st 2008 as demand and costs for steel making inputs has increased.

AK Steel said that its March 2008 order book is now open for hot rolled products, but said that there are limited quantities of cold rolled and galvanized products.

Pike River to raise NZD 100 million for mine development

New Zealand's Pike River Coal Limited said that it would raise about NZD 100 million in debt and equity to fund the development of its mine. The funding package will include a NZD 60 million renounceable rights issue to existing shareholders and note holders and a USD 30 million issue of convertible bonds.

The debt will be issued to Liberty Harbour, an investment fund which is part of Goldman Sachs Asset Management. McDouall Stuart Group is lead manger on the issue.

Pike River said the funding package would replace the mandate held by Westpac Banking Corporation to provide funding of NZD 65 million for development of the mine.

Mr Gordon Ward MD of Pike River said that the new deal was more favorable compared with the terms of the Westpac senior debt facility, offering greater certainty and more flexibility.

Mr Ward said that the new package also removed the need for bridge finance until the proposed Westpac facility could be drawn. It also meant PRC could now focus on the business of developing the mine. About USD 13 million of the additional funds would go on costs linked with new long term transport deals with Solid Energy, USD 11 million for additional tunneling costs and another USD 11 million to replenish the project contingency fund used to cover the tunneling costs. PRC has also lowered its expected annual coal production in the first year to 200,000 tonnes by down 40,000 tonnes.

The Pike River coal mine was floated in July 2007 by energy explorer New Zealand Oil & Gas, which will retain 34.6% of the company, while Indian coal companies Gujarat NRE Coke Limited and Saurashtra will hold 20.6%. Its mine, located on the west coast of the South Island of New Zealand, was now expected to produce 200,000 tonnes of hard coking coal in its first year, down from 240,000 tonnes in its IPO prospectus.

Japanese ferrous scrap export price hits record high

It is reported that ferrous scrap export price from Tokyo and Osaka has exceeded JPY 40,000 per tonne for H2 grade at export tenders hitting record. The price increased with higher freight and surging indicative US market. Japanese export price is expected to keep firm after the tender results.

SSESTEEL gets license to build billet plant

YIEH reported that Vietnam Industrial Investments has announced that SSESTEEL has got the license to build a steel billet plant in Haiphong.

The investment value is expected about USD 56 million and the plant is scheduled to complete in 2009.

The annual capacity at the electric arc furnace is 500,000 tonnes. SSESTEEL is a company established under the Foreign Investment Laws of Vietnam as a 100% foreign invested enterprise.

Metals recycler CMA appoints Mr Doug Rowe as new MD

Metals recycling group CMA has announce that its MD Mr Peter Hatfull has resigned and will be replaced by Mr Doug Rowe COO. Mr Rowe a substantial shareholder in the company will assume the role on February 1st 2008.

Mr Hatfull was appointed the inaugural chairman of CMA and led the company to its ASX listing in 2005. He said he had taken the company to the point where it was appropriate to implement a succession plan.

He said "I am very proud of the transformation CMA has undergone in the past two years. CMA has grown to become a truly international organization with a presence in every Australian state and territory as well as expanding into New Zealand, South-East Asia and soon into the United States. It is now appropriate for Doug to take over the company to the next level."

Metals recycling group CMA listed on the Australian stock exchange in July 2005 and now has a market capitalization of about USD 279.42 million.

Viet Nam-China Minerals and Coke starts coking coal shipments

VNA reported that the Viet Nam-China Minerals and Coke Company in northern mountainous Cao Bang province has shipped it first batch of 100 tonnes of coking coal to its customer.

Viet Nam-China Minerals and Coke Company is a joint venture between China-based Xin Chang Cheng Coke Company, northern coastal Quang Ninh province’s An Sinh Company and Cao Bang’s Production and General Services Company.

It started building a 300,000 tonnes per year coke production factory in Duc Xuan commune, Thach An district with an investment capital of more than VND 300 billion on March 10th 2007.

The factory is now capable of turning out 150,000 tonnes of coke per year.

Empresa Minera Huanuni tin output in December declined

ITRI reported that tin production at Bolivia’s largest mine Empresa Minera Huanuni has declined to 502 tonnes of tin in concentrate in December, well down on the record level of 823 tonnes achieved in November. The dip was due to a strike and other problems and is expected to be reversed this month.

Average monthly production in 2007 has been close to 700 tonnes per month, roughly double the level that was typical before the integration of a large number of co operative workers on to the payroll of the mine in November 2006.

Empresa Minera Huanuni is a subsidiary of state mining company Comibol and now has 4,600 employees. Planned investments of some USD 75 million over the next two years should boost production to 1,000 tonnes per month from 2009.

GE financing USD 115 million for Winner Steel acquisition

GE Commercial Finance Corporate Lending announced that it provided a USD 115 million asset based credit facility to support the acquisition of Winner Steel Inc by a joint venture between Novolipetsk Steel and Duferco Group. GE Capital Markets arranged the financing.

Winner is now operating as Sharon Coating LLC

Mr Bob Miller CFO of the joint venture’s US operations said that “GE’s extensive knowledge of the steel industry allowed them to quickly understand our needs and move swiftly to fund the loan. The financing provides our company with the financial flexibility and liquidity required to support our evolving business strategy.”

Mr Greg Eck metals and mining industry leader for GE Corporate Lending said that “Providing smart financing through an understanding of our clients and the industries in which they operate is our specialty. Whether the borrowing need is for acquisition finance, turnarounds or working capital, we are dedicated to finding the right solution to help companies execute their business plans.”

GE Commercial Finance Corporate Lending is one of North America’s largest providers of asset based, cash flow, structured finance and other financial solutions for mid size and large companies. From over 30 offices throughout the US and Canada, GE Corporate Lending specializes in serving the unique needs of borrowers seeking USD 20 million to USD 2 billion and more for working capital, growth, acquisitions, project finance and turnarounds.

Sumitomo to supply line pipes for IPIC project in Abu Dhabi

Sumitomo Metal Industries Ltd and Sumitomo Corporation have been awarded a contract for approximately 100,000 tonnes of large diameter welded line pipes by International Petroleum Investment Company, an enterprise wholly owned by Abu Dhabi government.

Sumitomo Metals and SC will be the primary suppliers of these pipes, which will be used to build an above ground crude oil export pipeline.

The 48" outside diameter welded line pipes would be manufactured by Sumitomo Metals Kashima Steel Works and coated in UAE. The order quantity is approximately 100,000 tonnes or 190 kilometers. The delivery period is July 2008 to December, 2008

UAE plans to build this pipeline as part of its national strategy to ensure stable crude oil exports. This is the first pipeline to link the Habshan field directly with Fujairah, a port city on the Gulf of Oman. The pipeline will be 360 kilometers long and use 220,000 tonnes of pipes.

Steel mills in Pakistan to get 12 hour electricity

Daily news reported that Pakistan government, in order to save the steel industry that is on the verge of collapse due to power shortage, has decided to restore the supply of electricity to steel melting and re rolling units from January 18th 2008 for 12 hours per day that would be increased to 20 hours from January 25th 2008.

The decision came in the meeting between Mr Tariq Hameed caretaker minister for water & power and a delegation led by Mr Ijaz Abbasi president of Islamabad Chamber of Commerce and Industry.

Sources said that the meeting was informed that the construction activities had been curtailed as steel re rolling mills have been closed due to shortage of electricity and gas supply rend 400 employees from one unit only without job. The meeting was also informed that there would be crisis of steel in the country if the prevailing situation goes unchecked. This would also deprive the national exchequer of PKR 1.28 billion being provided by the steel mills under the head of various taxes.

These units were closed down for 15 days on January 5th 2008, to save 450 MW of electricity to cope with the unprecedented power deficit that had reached to MW 3800 MW due to water and gas shortage in the country. Recent power crisis had led to the closure of 120 melting and 350 re rolling units in Pakistan.

At present Pakistan is facing a shortfall of 1300 MW but the situation is expected to improve on January 25th 2008.

Landbridge contract to be awarded by March 2008

Arabian Business reported that Saudi Railways Organization is expected to award the estimated USD 5 billion build own and transfer contract for the Landbridge project within the next 2 months. Bids for the project are currently under evaluation. SRO is confident that it will be in a position to select the winning bidder in the first quarter of 2008.

Four bidders that were pre qualified to participate in the tender for the Saudi Landbridge Project have submitted their bids. The bidders include Agility PWC Logistics Consortium, Mada Consortium, Saudi Binladin Consortium and Al Muhaidib Consortium.

The Landbridge will connect the port cities of Jeddah, Dammam and Jubail and will pass through the capital city Riyadh, serving its dry port. The project, which is being tendered on a build own and transfer basis, is one of the largest of its kind undertaken in the Middle East to date. It will transform the existing railway network in Saudi Arabia into a world class freight and passenger network linking the east and west coasts of the country. It will have the capability to move large quantities of cargo over long distances at competitive rates and will offer safe and comfortable overland passenger transport.

Kuwait to invest USD 10 billion in Philippines infra sector

Arabian Business reported that Kuwaiti firms, including logistics provider Agility, plan to invest more than USD 10 billion in infrastructure projects in the Philippines. Al Abraj Holding Company said that Kuwaiti firms and 1 non Kuwaiti company plan to develop airports, ports, railways, power stations and telecommunications.

Mr Sameer Nasser Ali Hussein deputy chairman of Al Abraj said that the deal is pending a signing with the Philippine government expected at the World Economic Forum in Davos in Switzerland.

Mr Hussein said that Al Abraj would set up a holding company in Europe, of which the Kuwaiti partners would own 75% and British firm Argon, acting on behalf of Philippine authorities, 25%. This could change a little. He added that Al Abraj wanted to raise the money possibly through an initial public offering, while Philippine institutions would also contribute to the project.

The Philippines government has said that it wants to invest PHP 1.7 trillion in its power, water, telecommunications and transport industries by 2010. Last year, it offered 10 infrastructure projects worth USD 2 billion to foreign investors.

Bahrain’s Ahli United Bank freezes business with Iran

It is reported that Bahrain’s largest lender by market value, Ahli United Bank, has suspended business with Iran, complying with US pressure to isolate Tehran over its nuclear activities.

Mr Jasim Ali a member of the Bahrain parliament’s finance and economic committee said that the government was putting pressure on Ahli United to freeze its Iranian operations

The report added that “Banks in the United Arab Emirates have stopped issuing letters of credit to Iranian companies.

Increasingly isolated from the West, Iran has long had close economic ties with most Gulf states, especially the United Arab Emirates and Bahrain, home to the Middle East’s biggest financial centres.

Mr Musharraf emphasises need of SMEs promotion in Pakistan

Pakistani President Mr Pervez Musharraf, while addressing the employees of Pakistan Steel Mills recently, has underlined the need for special focus on small and medium enterprises besides value addition and diversification of industries for capturing a big share of international market and for creating maximum jobs for the people.

Mr Musharraf said that “Industrialization is the root of an economy and that small and medium enterprises are the most potential sector for industrial growth of the country. It also helps create large number of jobs for the people and spread of wealth down to the middle class people.

He added tat “Traditionally, we are dependent on 2 major sectors for economic growth which are textile and agriculture. This trend should be changed as diversification of products and value addition was very essential to cope with the changing global market and make best use of our resources.”

He expressed satisfaction over the performance of Pakistan Steel Mills workers and the management who through team work have turned this organization into a profit earning and progressive public sector establishment, which was previously in shambles due to the wrong policies and mismanagement. He said “In 1999, Pakistan Steel was in a very bad condition. It was shifting its loss of billions of rupees to national exchequer every year. Production was very low.”

Mr Muhammad Javed chairman of Pakistan Steel Mills gave a brief account of Pakistan Steel and its present status after its turn around to earn profit of billions of rupees. He said that the long awaited capital repair and maintenance of the plants had also been started, utilizing the Mills’ own earning.

Iron ore price negotiations – Baosteel says talks still underway

China's largest steel maker Baosteel said that it is still in iron ore price talks, denying a report it had walked out of negotiations over the price demanded by ore producers. The Australian Financial Review reported Wednesday on its website that Baosteel had left the negotiating table, blaming high prices asked by miners.

Mr Wang Liqun GM of Baoshan's raw materials purchasing centre said "Baosteel is still in the middle of negotiating with ore miners. We are proceeding the talks with the big 3 as per the schedule and we are yet to come to the phase of settling the price, as more exchange of views are needed for us."

He expressed that “Our negotiation is going along normal commercial procedure and regulations. As for the expectation of price rise, I could only say that we have not come to the phase of the negotiation and both parties need to exchange opinions.”

Official from Rio Tinto's mining department also denied the rumor and assured that the negotiations are still going on though little progress has been achieved yet.

The world's three largest miners BHP Billiton, Rio Tinto and Vale are supposed to hammer out annual contract prices for iron ore with a Baosteel, which is representing Chinese representative, the biggest player in sea borne trade of iron ore.

In 2006, China was the world's first major steel producer to settle with the three mining firms, agreeing to a relatively modest hike of 9.5% for the year starting April 2007 after 19% rise in 2006 and a 71.5% spike in 2005.

Shagang to complete merger of Jiangsu Tieben soon

According to Mr Jia Xiangrong former vice board chairman of Jiangsu Shagang Group Co, Shagang would soon finish the merger of Jiangsu Xinrui Group. This is the fourth merger in domestic steel market of Shagang which is the largest private steel enterprise in China.

Shagang has already acquired Jiangsu Huaiyin Steel, Henan Yongxing Steel and Jiangsu Yonggang Group whose annual capacities are all over 2.5 million tonnes. However, the total steel capacity of the first and second phase of the project in Xinrui Group is only 350,000 tonnes per year to 400,000 tonnes per year.

A market participant said the aim of the merger by Shagang may be not the new mill, but the old mill. It is realized that the capacity of Jiangsu Tieben Steel Co which is vicariously managed by Xinrui Group, is over 1.2 million tonnes per year with a total capital of over CNY 3 billion.

Nanjing Iron & Steel Co was willing to recombine Tieben Steel in last June and it has already submitted the merger plan to National Development & Reform Commission of China but it has not been approved. An official, who has been working for Chinese iron and steel industry for many years, told us that the recombination of Tieben Steel would not be carried out in a short term.

Vale cancels 30 iron ore shipments to China

It is reported that Brazilian iron ore producer Vale has cancelled 30 iron ore shipments to Chinese mills in the first three months of this year due to repair work at ports and congestion.

The mills have also been informed of delays to a further 20 cargoes from the same source, indicating that Chinese steel producers will have to make alternative arrangements to ensure a constant supply of the raw material.

Vale has said that export stoppages from its Itaguaí maritime terminal “represents an average daily loss shipment of 60,000 tonnes of iron ore.” The terminal, which boasts an annual shipload capacity of 25 million tonnes of iron ore is expected to return its regular operations by the beginning of February.”

Vale also operates the Ponta da Madeira maritime terminal, Guaíba Island maritime terminal and the Tubarão Port.

Baosteel Group founds Baosteel Metal Co Ltd.

It is reported that Baosteel has founded Baosteel Metal Co Ltd by recombining steel processing enterprises under Baosteel Group, reflecting that Baosteel will strengthen its industrial devotion in diversification.

As per report, the key business of Baosteel Metal Co Ltd includes steel structure, metallic packing, auto accessories, steel wire, etc. Baosteel has already established the plan for entering auto accessories industry. With a core of the production of wheel, dynamical transmission system and auto system, it hopes to become a famous auto accessories manufacturer and supplier in the world which possesses self exploiting ability, scale production system, independent intellectual property rights and international sales network.

According to strategic developing program of Metal Co Ltd for the period from 2008 to 2012, the company hopes the sales income could increase from current CNY3 4 billion to CNY 20 billion in the coming five years.

After the foundation of Metal Co Ltd, Baosteel will accelerate the development of steel processing business on the base of strategic products such as auto steel, tin plate, wire and construction steel structure, etc. There would be more steel processing industries come into Metal Co Ltd from the group.

Laiwu Steel 2007 profit up by 50% YoY

LaiWu steel company announced on January 17th that its net profit may increase by over 50% in 2007 from the year earlier, duo to the high steel prices. Another reason for the profit increase is that the company strived to enhance its product mix and upgrade technology in 2007.

The net profit of the company in 2006 was CNY 746 million. Its parent company, LaiWu steel group is the ninth largest steel maker in China.

Chinese zinc majors not impacted by the new export tax

Platts reported that major Chinese zinc producers see little impact from the Chinese government's decision to imposed a 5% export tax on #1 zinc and a 15% export tax on #2 zinc effective January 1st 2008.

Although a Beijing based independent zinc analyst said that the new export tax policy might cause some smaller scale Chinese zinc smelters to shut down on increased costs, but key Chinese zinc smelters said the new export tax would not affect them.

In South China, an official with major Chinese zinc producer Shenzhen Zhongjin Lingnan Nonfemet Co said the company's #1 and #2 zinc had been reserved for its own consumption, so the new export tax will not affect our export business."

In Hunan Province, an official with Zhuzhou Smelter said the company mainly produces #0 zinc which is currently free from any export tax, so the export tax on the other grades would not affect its business operations. Another Zhuzhou official said that due to poor LME prices, we have mostly sold our zinc locally over the past two years.

Chinese customs statistics show that China exported 263,900 tonnes of zinc during the first 11 months of 2007 up by 7.9% from the corresponding period in 2006.

China to be biggest wind turbine manufacturer by 2009

Interfax China cited Mr Steve Sawyer Secretary General of the Global Wind Energy Council as saying that China may become the world's biggest manufacturer of wind turbines by 2009.

Mr Sawyer said that this prediction is based on the market research carried out by Azure International. According to the research, China's wind turbine production capacity will reach 10,000 MW by the end of 2009 up from the present 4,000 MW and be equal to more than half of the world's current wind turbine production capacity.

Mr Sawyer said "I think the Chinese government and interest from the outside world would be the two factors in driving China's wind turbine market. As the policy maker, China's government approved the Renewable Energy Law in 2005. Governmental approval did a lot to promote this market."

Mr Sawyer said that “Goldwind Science and Technology Co Ltd and Huarui Group, two top manufacturers of wind turbines in China have already developed plans to export turbines in 2009 and 2010. Although Chinese wind turbines have not yet been sold outside the country, once the government begins encouraging their export, Chinese wind turbines will have a big impact on the global market in terms of price decrease.”

Globally, wind power accounted for only 1% of the world's total electricity power supply in 2007. However, Global Wind Energy Council expects wind farms to supply 12% of the world's power by 2020.

Hansteel submits merger plan in the south of province Hebei

It is reported that Hansteel Group has submit a specific plan on the merger of iron and steel industry in the south of province Hebei. It hopes to reconstruct Hansteel by fetching in strategic investors and to acquire or recombine resources in local regions by capital chain. However, it is uncertain whether the plan could be carried out.

There was a glancing plan on the merger of iron and steel industry in province Hebei. They planed to construct a big sized steel group in the south of the province on the base of Hansteel and to build a big sized steel group in the north on the base of Tangsteel.

Now the merger in the north of the province has already been completed. However, because Xinggang which lies in the city of Xingtai, has already fetched in a company locates in Hong Kong as its strategic investor, the merger in the south could not be as simple as in the north.

As a result, Hansteel Group suggests to build a company which is held by Hansteel Group, and to fetch in investment from private steel companies at the same time, in order to collect capital to complete the merger. By the capital chain, regional national or private steel enterprises could enter Hansteel Group by taking shares.

Caofeidian Port throughput in 2007 cross 20 million tonnes

It is reported that the throughout of Caofeidian Port exceeded 20 million tonnes in 2007 reached 20.08 million tonnes. As per report, it took only one year for Caofeidian port to achieve the throughput from 10 million tonnes to 20 million tonnes.

Caofeidian Port overcame several major international ore market turmoil in 2007 and the number of ships handled reached 170.

At present, a large number of large specialized terminals including crude oil terminals, Coal terminal are speeding up the construction. After the completion, Caofeidian port’ throughput will reach 100 million tonnes.

China imports record 163 million tonnes of crude oil in 2007

According to China customs figure that China's crude oil imports rose 12.4% in 2007 over the previous year to a new record of 163.17 million tonnes.

According to the General Administration of Customs that Crude oil imports for 2006 were 138.8 million tonnes, representing an increase of 16.9% from the previous year. The exports however fell by 38.7%YoY to 3.89 million tonnes last year.

China also imported 33.8 million tonnes of oil products in 2007 a decline of 7.1% from the previous year although large oil producers increased oil product imports late last year following a fuel shortage reported in October.

Mr Niu Li an analyst with the State Information Center said "China would need to increase oil imports year by year, as its own crude oil output growth failed to outpace consumption demand in recent years. The country's crude oil output had been growing at an annual rate of about 2% over past few years, however, oil consumption increased by about six percent annually.”

Mr Haiduk to sell his stake in IUD – Report

Ukrainian News Agency reported tat Mr Vitalii Haiduk, who as been recently nominated as industry minister of Ukraine, has decided to sell his stake in the Industrial Union of Donbas. Mr Serhii Taruta chairman of IUD during an interview with the Ekonomicheskiye Izvestia newspaper announced this move.

Mr Taruta said that Mr Haiduk had decided to make his political carrier. According to Mr Taruta, Mr Haiduk does not want his participation in a company give grounds for accusations of lobbying someone's private or commercial interests.

Mr Taruta said that "Under our mutual agreement he decided not to separate the business, but leave it and sell his stake to the shareholders of the company and dedicate himself to his future political carrier.”

He said that the talks on the sale of Haiduk's stake in the Industrial Union of Donbas continue. He said "We are holding consultations on the matter. I am obliged to note that the process is constructive and absolutely civilized.”

As per report, the Azovinteks company of Mariupol and the Vis-a-vis company of Donetsk each own a 49.99% stake in the Industrial Union of Donbas, while the Oniks Don company of Donetsk owns 0.02%. Mr Taruta controls Azovinteks and Mr Haiduk controls Vis-a-vis. IUD controls the Alchevsk and Dniprovskyi metallurgical plants, the Dnipropetrovsk pipe plant, the Alchevsk coke and chemical plant, as well as the Dunaferr and the DAM Steel metallurgical plants in Hungary, Huta Czestochowa in Poland, among other assets.

Ukraine to privatize KGOKOR in 2008

Ukranian media reported that Mr Oleksandr Turchynov first deputy prime minister of Ukraine, while speaking at a meeting at the government recently, said that Ukraine will most likely sell its major iron ore deposit Kirovohrad Oxidized Ore Mining and Enrichment Plant later this year via a competitive tender.

He said “We discussed this issue. I believe that its privatization this year is realistic.”

Ukraine’s cabinet of ministers decided on August 2nd 2006, to set up a joint venture in the form of an open joint stock company with a government-owned stake of at least 50% plus 1 share with the aim of attracting an investor for completion of KGOKOR. A special government working group later selected the Smart Group and Metalloinvest as investors in creation of the joint venture.

But Ukrainian State Property Fund postponed the signing of an agreement on creation of a joint venture with the Smart Group Company and the Metalloinvest of Russia for completing construction of KGOKOR on September 20th 2007. Arcelor Mittal Kriviy Rih stated its intention to create a consortium for completing construction of KGOKOR also on September 2007.

KGOKOR was being established as a joint venture by the governments of former USSR, the former East Germany, the former Czechoslovakia, Hungary and Romania. The construction started in 1983 but was later stopped after it had reached 70% completion. During construction of KGOKOR, oxidized ore at the tailing dumps of the Novokryvorizhskyi ore mining and enrichment plant, which is presently part of Arcelor Mittal Kriviy Rih, was expected to serve as the raw material base for KGOKOR.

MMK announces 2007 production results

Magnitogorsk Iron & Steel Works has announces its production results for the 4th quarter and 12 months of 2007. Steel products output of MMK grew by 7.6% in 2007 compared to 2006 and amounted to 12.2 million tonnes. It is the record level of production in MMK history.

(In million tonnes)

MMK said that “The slight decrease of cast iron output is due to repairs and upgrading of blast furnaces. The cast iron output came slightly down in Q4 of 2007 because of reconstruction works at blast furnace 9 which has the highest production capacity. The crude steel production increased by 6.5%YoY because of increasing production at the electric arc furnaces.”

The product wise update is as under

(In million tonnes)

MMK said that “The faster growth of steel making capacity compared to MMK's present rolling capacity led to growth in commercial slabs and billets production. Extension of long products and colour coated steel output is also due to reaching full capacities of the production facilities. The demand factor influenced the production volumes of tin plate and formed sections. Insignificant production decrease of hot rolled steel and formed sections is also called forth by planned repairs of the facilities; reduced long products and color coated steel output is accounted for by seasonally weakening demand for these product types.”

Mechel announces its operational results for 2007

Mechel has announced its operational result for 2007 as under

In million tonnes

Mr Vladimir Polin CEO of Mechel Management OOO said on the operational results for 2007 that “Last year was exceptionally successful for Mechel’s production operations as we increased the output of our main products.”

He said that “Due to the successful implementation of the technical re equipment program for Mechel’s mining subsidiaries, our coal production has grown significantly, having surpassed our planned indicators by nearly 3 million tonnes, which was also supported by the acquisition of Yakutugol OJSHC. The iron ore concentrate production at the Korshunov Mining Plant was approximately 5 million tones, the same level as in the preceding year and consistent with the plants designed capacity. Favorable market pricing for nonferrous metals and more efficient utilization of our Southern Urals Nickel Plant’s production capacity enabled Mechel to significantly increase its nickel output.”

Mr Polin said that “We also achieved high production levels in our steel segment. Mechel’s acquisition of Bratsk Ferroalloy Plant in the fall of 2007 strengthened the promising ferrosilicon segment of its business. We increased steel and rolled product output in 2007 and significantly expanded our steel product mix in terms of grades and sections, specifically in hardware production. This was facilitated primarily by the large scale technical re equipment program for our Beloretsk Metallurgical Plant subsidiary, which specifically provides for commissioning modern hardware equipment. We continued to demonstrate consistent growth of our coke output, which is supported by the efficient operations of our Moscow Coke and Gas Plant and the new coking battery at Chelyabinsk Metallurgical Plant.”

Mr Polin added that “Mechel has acquired a number of power assets since the beginning of 2007, significantly expanding its presence in the power sector. As the result of the acquisitions, we established an integrated power division with its own raw material base, power generating facilities and broad client base. As seen in the operational results, the division demonstrated intensive growth of electric power generation in 2007. We are confident in the future of the new segment, which we are able to operate efficiently considering our experience in effectively integrating acquired companies.”

ThyssenKrupp Materials opens a branch at Kazan

FIS reported that, in line with its strategy on regional development, ThyssenKrupp Materials opened a new branch in the capital of Tatarstan to provide customers with a broad range of ferrous and stainless steel metal roll and services.

A service metal center of ThyssenKrupp Materials is also to be opened in Nizhniy Novgorod in late 2008.

At present ThyssenKrupp Materials has branch in six Russian regions.

Yenakiyevsky 2007 steel output up by 9.3% YoY

Ukrainian Yenakiyevsky Steel group announced that it has increased liquid steel output by 9.3% YoY to 2.79 million tonnes in 2007 as compared with 2.55 million in 2006 and 2.25 million in 2005.

The company said it has increased pig iron output by 11.3% to 2.45 million tonnes in 2007

In 2007 the plant launched a new blast furnace, saying it would boost pig iron output by 1.05 million tonnes per year and invested USD 140 million into the furnace construction. It said an additional USD 1 billion would be invested in the next five years. It also said it planned to modernize three other blast furnaces soon.

Evraz completes tender offer for shares of Claymont Steel

Evraz Group announced that the cash tender offer by its wholly owned subsidiary Titan Acquisition Sub Inc to purchase all outstanding shares of common stock of Claymont Steel Holdings Inc, which expired at midnight New York City time on January 16th 2008, has been successfully completed.

Evraz and Titan Acquisition Sub Inc have been advised by Mellon Investor Services LLC, the depositary for the tender offer that as of the expiration of the offer at midnight, New York City time on January 16th 2008 stockholders of Claymont Steel had tendered into the tender offer 16,415,722 shares of Claymont Steel common stock representing approximately 93.4% of the outstanding shares of common stock of Claymont Steel. Evraz has accepted for payment all shares of Claymont Steel common stock that were validly tendered during the offer period.

The release added that “In accordance with the previously announced merger agreement, Evraz now intends to effect a short-form merger. Pursuant to the merger agreement each share of Claymont Steel common stock not accepted for payment in the tender offer, other than those as to which holders validly exercise dissenters’ rights and those held by Evraz or Claymont Steel or their respective subsidiaries, will be converted in the merger into the right to receive USD 23.50 in cash without interest thereon and less any applicable stock transfer taxes and withholding taxes. This is the same price per share paid during the tender offer. Evraz intends to complete the short-form merger in the next several days.”

Murmansk Port start construction of new coal terminal

Interfax reported that the Murmansk Sea Trade Port will start the construction of a new coal terminal in late 2008. The terminal has a price tag of USD 70 million and will be completed by year 2011.

Mr Viktor Morozov Port director said that all necessary documentation and preparations will be ready in the course of the next months and that construction will be started in late 2008.

The new terminal will be located on the eastern shore of the Kola Bay. The Murmansk Sea Trade Port also has major plans for the construction of a new coal terminal on the western shore of the bay.

Coal is together with ore is the most important trade item for the Murmansk Port.

Russian Railways wins tender in Armenia

Itar Tass reported that the Russian Railways Company will be officially named as the winner of an international tender for the concessional management of the Armenian Railways Company for a period of 30 years soon and a ceremony with the participation of Mr Vladimir Yakunin president of Russian Railways will be held in Yerevan.

The terms of the concession provide for USD 170 million investments, but Russian Railways offered a far great sum USD 570 million of investments with USD 230 million to be invested in the coming five years. Under the terms of the lease, Russian Railways will allocate 2% of its annual turnover to the Armenian budget, along with current taxes and fees.

According to Mr Andranik Manukyan Armenian Minister of Transport and Communication “The investments of Russian Railways will be even greater, if the border with Turkey is opened and railway traffic to Armenia by the Azerbaijani railway and through Abkhazia is resumed. Russian Railways will contribute USD 5.5 million to the Armenian budget as a one time concession payment.”

Mr Manukyan reminded that the Armenian Railways Company would continue to be the property of the Armenian government, and Russian Railways would only manage it.

The Armenian railway was built on the order of the government of the Russian Empire in the second half of the 19th century. The first train came from Tiflis to Alexandropol in February 1899 after covering 220 kilometers. A total length of the railways belonging to the Armenian Railways Company is 1,125 kilometers. It includes 75 railway terminals and four terminals on the border with Georgia, Azerbaijan and Turkey.

Nakhodka Port traffic in 2007 dips by 21% YoY

FIS reported that in 2007, freight turnover of Nakhodka Sea Port declined by 20.7% YoY to 5.468 million tonnes as compared to 2206.

Nakhodka Sea Port handled 4.247 million tonnes of general cargoes in 2007 down by 24.1% YoY, including 3.831 million tonnes of metals down by 27.97% YoY and 391,500 tonnes of bulk cargoes 4.4 times more than in 2006.

Its handling of coal and coke grew by 5.3 times to 84,300 tonnes.

Nakhodka Sea Port belongs to Evraz Group and is a base for shipping the products manufactured by it's enterprises to Asian countries including China.