Indian finished carbon steel production in 9 months up by 6.6% YoY

As per a release from steel ministry, India’s finished carbon steel production has touched 38.05 million tonnes during April to December 2007 period up by 6.6% YoY as compared to 35.704 million tonnes during April to December 2006 period.

Imports of finished carbon steel during April to December 2007 went up by 66.9% YoY from 2.936 million tonnes to 4.9 million tonnes. During the same period exports recorded a rise of 9.1% YoY to 3.850 million tonnes from 3.529 million tonnes.

ArcelorMittal to announce Jharkhand project site soon

Ranchi Express reported that ArcelorMittal would announce the site for its Jharkhand Steel project within a week.

The report cited Mr KK Khandelwal Jharkhand’s secretary for industry told media on weekend that a team of senior officials from ArcelorMittal including Mr Sudhir Maheshwari executive VP finance and M&A, Dr Sanak Mishra CEO of ArcelorMittal India and Mr MP Singh VP mining gave the assurance during a review on Friday.

Prior to the review, the ArcelorMittal officials called on Chief Secretary P.P.Sharma and Mines Secretary Jaishankar Tiwari.

Quoting the officials, Mr Khandelwal said, "We have almost complete the survey for site selection of the Jharkhand project. Hopefully, it would be announced within a week."

SAIL RDCIS wins prestigious Golden Peacock Award

The Research & Development Centre for Iron & Steel of Steel Authority of India Limited has been selected as the winner of the Golden Peacock Innovative Products or Service Award 2007 of the Institute of Directors.

The jury for the award was headed by Justice Mr PN Bhagwati former chief justice of India and member of United Nations Human Right Commission. The award will be presented by the Mrs Ambika Soni union minister for tourism and culture at a special ceremony during the Valedictory Session of the 18th world congress on total quality.

The Golden Peacock Award signifies the pinnacle of achievements in recognition towards the development of innovative value added products, suited to demanding application environment in high growth segments such as construction, automobiles, defence etc.

SAIL has successfully developed and marketed a number of special steel products like earthquake resistance TMT rebars for constructional work in seismic prone zones, high strength roof bolt for underground coal mines, SAILMA 550 HI Plate for penstock, high strength cold rolled steels for automobile.

Product development activities are among the core activities of RDCIS for which this award has been given. Previous to this, in the year 2004 RDCIS received this Golden Peacock Awad in the area of manufacturing in steel sector.

INSDAG to commission study to assess steel demand in rural areas

Mr PK Bishnoi president of INSDAG and CMD of Rashtriya Ispat Nigam Limited said that union ministry of steel and the Institute for Steel Development & Growth will jointly commission a study to assess the demand for steel in the rural areas up to the year 2020. Mr Bishnoi said that an INR 20 crore campaign had been launched to promote the usage of steel in the rural and urban areas.

Mr Bishnoi said that a committee, comprising representatives of the major steel producers, would decide on the parameters that would be taken into account while collating data on the consumption of steel in the rural areas at present and the likely demand for the product till 2020.The entire exercise will be overseen by the Joint Plant Committee.

He informed that “The first phase of the steel for life campaign is almost over and a review of the same would be made in March 2008 before a decision on the next phase of the campaign is taken.”

JSPL commissions RH Degasser at Raigarh Plant

Jindal Steel & Power Limited has successfully commissioned the RH Degasser in Steel Melting Shop at their Raigarh Plant for manufacturing of rail steel and other special grades on December 12th 2007.

This stupendous task and installation of critical equipments was completed in record time of just 60 days. The technology and equipments for RH Degasser have been supplied by SMS Mevac UK, SMS Demag India and installation & commissioning by JSPL project team with supervision from suppliers. The refractory for the vessel of RH Degasser was supplied by TATA Refractories Limited.

Mr Naveen Jindal executive vice CMD of JSPL said that "It is indeed a moment of great pride & honor for the company and its people. With the commissioning of RH Degasser in steel melting shop, our company has taken a quantum leap in the production of rails, and with JSPL already producing world's longest 120 meter rail, the improved rail is certainly going to meet the international standards in terms of economy, safety, specifications and reliability."

Jindal Steel & Power Limited is an integrated steel plant with a steel production capacity of 2.4 million tonnes per annum, wherein captive power plant of 350 MW has been established for its own use. Its turnover for the year ending December 31st 2007 was INR 3500 crore. It is engaged in steel production, power generation, iron ore & coal mining and diamond exploration.

Indian ferroalloy makers seek ban on export of ores

India’s ferro alloys industry has recently pointed out that exports of ores are starving domestic industry of these critical raw materials needed to produce the alloys. It feels that with domestic steel production projected to sail past the 100 million tonnes mark by 2019-20, the non availability of domestic manganese and chrome ores could indirectly affect the steel industry’s growth plans.

Mr TS Sundaresan secretary general of the Indian Ferro Alloy Producers Association said that as against a production capacity of 320,000 tonnes including manganese alloys, ferro silicon and chrome alloys, and the industry produced only a little over 2 million tonnes in 2007, which meant a capacity utilisation of 62%. He added that “This fiscal too it will remain at this level, as ferro alloy imports have reined in our capacity utilisation.”

The ferro alloys industry is estimated to have imported about 528,000 tonnes of manganese ore in the last 3 years, valued at a total of about INR 395.30 crore. During the same period, the manganese ore industry exported a total of 702,000 tonnes, valued at about INR 161 crore.

Mr Sundaresan said that “If the manganese ore producers had not exported this quantity and had instead made it available to the domestic ferro alloy industry, it would not have imported the ore that had resulted in a forex outgo of INR 395.3 crore in the last 3 years.”

Industry source said that during the last 3 years, about 12,500 tonnes of chrome ore, valued at INR 16.4 crore, was imported. During the same period, the chrome ore miners exported more than 3 million tonnes of the ore. It added that “The chrome ore industry produces about 3 million tonnes annually, out of which more than 1 million tonne is exported in the form of ore and concentrates. If exports continue, the reserves of the proved category may deplete in another 10 years.”

CIL to raise coal production from underground mines

BS reported that Coal India Limited has prepared a roadmap to raise production from the underground mines in the 11th Plan period through mechanization, which would involve an investment of INR 5,000 crore.

Mr NC Jha director technical of CIL said that "Underground mining is the focus area in the 11th Plan and CIL has chalked out a program to ramp up production from underground mines from the present level of 43 million tonnes to nearly 67 million tonnes by 2011-12."

He added that mechanization would raise capacity and bring the cost of production from the underground mines. The cost per tonne would be reduced from the present level of INR 1,800 per tonne to around INR 1,000 per tonne.

CIL has identified 8 blocks with total reserves of 1,500 million tonne where underground mining will be undertaken through third parties. The blocks identified include 2 under Eastern Coalfields Limited command area, 1 under Bharat Coking Coal Limited, 1 under Mahanadi Coalfields, 3 under South Eastern Coalfields Limited and 1 under Western Coalfields Limited.

Mr Jha said that “We are in the process of inviting expressions of interest for these blocks. The idea is to involve third parties either through JVs or as operators to extract coal from underground mines. They will be involved from the stage of exploration to extraction for these underground mines.” He added that the selected parties for these 8 blocks will bring in the equipment, develop the mines and maintain the same for a period of 10 years while the investments will be undertaken by CIL.

At present, CIL has 2 underground mines at SECL, and 1 each at ECL and SECL. The largest volume of production is from the SECL mine which contributes about 16 million tonne out of a total of 43 million tonne. The thrust on underground mines is to achieve a balance between open cast production and underground production to meet future demand for coal.

Indian GDP growth for 2008-09 pegged at 8.5%

Prime Minister’s Economic Advisory Council has forecast Indian economy to grow by 8.5% during 2008-09, despite the likelihood of a slowdown in the US and the developed world.

The Economic Advisory Council, headed by Dr C Rangarajan, in its “Review of the Economy 2007-08” report, said that “Indian economy is much less dependent on the external markets than the Chinese economy, for example. Thus, while some export demand compression is likely to put an additional burden on our exporters of goods and services, it is unlikely to be large enough to significantly depress growth.”

The report has also marginally revised downwards its growth estimate for the current fiscal to 8.9% as against the earlier projection of 9% made in July 2007.

Economic Advisory Council has noted that the situation has changed dramatically since in the wake of the sub prime housing mortgage crisis in the US and a general consensus of a slowdown in its economy in 2008. But the council is of the opinion that the slowdown will be a modest one which would not significantly impact India’s next year’s growth prospects by much.

Port Gangavaram to commence phase 1 operation by April

Exim News Service reported that Port Gangavaram, the super Capesize capacity deep draught Greenfield facility with completely mechanised operations on the East Coast of India, is rapidly progressing towards commencement of phase 1 operations by April 2008.

According to an official report, Port Gangavaram berthed its second vessel, which was carrying project equipment from China on January 4th 2008. The port equipment, shipped by Zhenhua Port Machinery Co of Shanghai, was delivered to Duro Felguera. The first project cargo vessel berthed at the port on November 27th 2007.

All the 5 berths under phase 1 are expected to be ready by the end of March 2008. Of these, construction of the iron ore berth has been completed, the coal berth is under completion and the remaining 3 berths, for dry bulk and multi-purpose cargo, will be ready by the March 31st 2008 deadline.

Dredging work in the channel and full turning circle has reached a stage of more than 15 metres draught already, which will increase to 20 metres by March end, thereby facilitating the berthing of super capesize vessels of up to 200,000 DWT capacities.

Construction of other civil works like roads, buildings, railway line, stack yards, conveyor and electrical works is currently at an advanced stage and will be completed before the scheduled commencement of operations. The progress in the construction of the port has been remarkable, the communiqué emphasises, with phase 1 to be completed within 2 years from commencement, which, it claims, is a port construction record.

The port management is now eagerly looking forward to launching commercial operations and promoting Port Gangavaram as an important trading hub in South East Asia and the rest of the world.

India inks MoU with China for railways development

It is reported that, in a major move aimed at cooperation between Indian Railways and Chinese Railways, a MoU was signed between them in Beijing during prime minister’s recent visit to China.

The MoU, valid for 3 years, envisages development of rail related programs of mutual interest, consultations, training and visits to each others’ facilities. Indian Railways has made tremendous progress in different sectors of its railway operation leading to great turnaround in its functioning and is fully gearing up towards modernization, technological upgradation, capacity enhancement and development of world class services.

The MoU signed with China will further facilitate progress in that direction. The areas in which cooperation with Chinese Railways will be sought are in raising of speed on existing routes, development of world-class stations, heavy haul operations, development of multimodal logistics parks and in research and development. The Chinese Railways’ experience in the areas of signaling & telecommunication, traction supply, high axle load operations, design & maintenance practices, track machines, development & operations, multimodal transport in railway sector would be of benefit to Indian Railways.

Chinese Railways carry the highest level of freight traffic in the world and also a very high level of passenger traffic. It has undertaken considerable network expansion, speed raising, modernization and technology upgradation during the last 10 years and have a very ambitious program for the next decade too.

ThyssenKrupp to sell precision forging business to Indian firms

It is reported that German component giant ThyssenKrupp is looking to sell its global precision forging business. The deal, estimated to be worth around INR 600 to 700 crore, has attracted interest from Mahindra & Mahindra, Bharat Forge and Sona group.

ThyssenKrupp’s precision forging plants are mostly in Germany. The division’s biggest plant is in Remscheid which is focused on the car industry. The second biggest is based in Munich with a truck industry focus. The third is in Wanheim and concentrates on heavy duty components. It also has a very small plant at Selma in the US which caters to both car and truck industry.

ThyssenKrupp’s precision forging business clocked a top line of EUR 286 million in 2007. Sources in the financial circles say the German major may also be looking to sell its crankshaft business and several Indian companies had evinced interest already. However, no confirmations were available on that deal.

Sources said that the reason for Indian companies showing so much interest in this deal is because of ThyssenKrupp’s truck and car focus and West Europe footprint. As more and more MNC original equipment manufacturers source components from India for their local and global operations, Indian component biggies are scaling up their presence in overseas markets.

Forging has been the most deal active part of the Indian component industry. Given India’s scale and skill in that area and the cost structures in Europe, a number of top Indian component companies like M&M, Amtek and Bharat Forge have been very aggressive in picking up assets and companies in Europe.

In the past two years, M&M, Bharat Forge and Amtek have all been active in deal picking. M&M bought UK based automotive forging firm, Stokes, and Bharat Forge took over FAW Forging of China, apart from pickings in the US, Germany, Sweden and Scotland.

Indian iron ore export tax would deter China – Chinese experts

Interfax China reported that Indian ministry of steel's proposed 10% to 15% tax on iron ore exports will further push China to source iron ore for production from elsewhere.

Mr Yu Liangui an analyst with Mysteel said that "India is currently the third largest iron ore supplier to China. However, the proportion of imports made up by Indian ore has been dropping since last year, when India imposed the previous iron ore export tax. This has made China seek out other sources, which it will do with more vigor if India further stiffens its taxes."

Mr Yu said that "The growth rate of Indian iron ore imports also fell from its usual level of around 20% to about 5% for 2007, which also indicated that the current Indian export tax policy is taking effect. China has been taking pains to increase iron ore imports from further field. A proposed iron ore export tax of 10% to 15%, based on prices, would give Chinese steel mills an even harder time. In the meantime, Indian miners stand to suffer from a rise in export taxes, as currently 80% of India's iron ore exports go to China."

Mr Yu said that "The Indian government is bound to introduce new export tax policies to reserve iron ore resources for domestic steel industry development and to gain profit, while at the same time lowering export volumes."

India's ministry of steel has submitted pre budget recommendations to the Indian finance ministry recently. The proposed duty would be based on current FOB prices, replacing a system of fixing specific rates on every tonne shipped out of India. The budget is expected to be completed on February 29th 2007.

In 2006, the Indian government introduced ore grade specific export taxes of INR 50 to INR 300 per tonne, representing the first move by the Indian government to conserve iron ore. However, iron ore prices surged over the year, with FOB prices of grade 63.5% Indian iron ore reaching USD 135 to USD 140 per tonne at the end of December 2007, up by 146% from the per tonne price of USD 57 at the beginning of 2007.

Iron ore from India accounted for 20.3% of China's total iron ore imports for January to November 2007 down from 22.9% in 2006. For the month of November, 2007, India was the source of 16% of China's iron ore imports.

Why not ……? Racing Ahead with mentors!

This inspiring quotation as helped many move ahead in life thinking ‘why not?’ as it gives another perspective to things in life. There are numerous ways to observe episodes that happen in our day to day life. Some complain, some pacify, some fight, some speak out while a few learn and think beyond.

The corporate world is full of mishaps urging people to look for books that give guidance and insight to lead them out of the mess. Mentors are aplenty but not all aspiring corporate honchos get one. A guiding step in the right direction can take a professional way ahead on the corporate ladder while one wrong move can result in disaster.

The book has been authored by a top executive, for whom the road was not a smooth one and his corporate success was the result of learning not only from his mistakes but that of others and simple incidents that took place.

He wanted to learn about “why” and “how” to do things the right way and not just “what” the right path is. When his requirement failed to be fulfilled by books already in the markets, at the peak of his career he took the plunge and authored “why not…? Racing ahead with Mentors”

A superficial character, Rehaan, is appointed the CEO of a big corporate house. This is what he had been looking forward to for the last 20 years of his life. As the news is broke to him, he sits back and recalls incidents of his life that made him successful for others to emulate. Rehaan, in the book, constantly engages in a conversation with his inner-self he has named Chief. These tête-à-têtes are enlightening and embellished with quotable quotes.

Every chapter is an incident from his life that taught him and helped him grow as a person and as an entrepreneur. These are life-like incidents that are not just related his office discussion but also to friends, foes and relative. At the end of every incident is Rehaan diary where he writes about what he learns that day. There are also some quotes by renowned people that are inspiring.

Mr Partha Sarathi Basu, the author of this book and can be contacted at basu.partha@yahoo.co.in

BEML floats JV to enter mining operation

Bharat Earth Movers Limited has entered into a JV agreement with Hyderabad based Midwest Limited and Sumbermitra Jaya of Indonesia to develop the mining operations.

The new JV called BEML Midwest Limited would provide total mining solutions, right from mine development to mine management and maintenance.

BEML enjoys a 70% market share in India in the mining and construction equipment sector. With a present turnover of INR 2,600 crore, BEML is eyeing revenue of INR 5,000 crore by 2013-14. It exports to more than 45 countries. It has also set up an international warehouse in Malaysia for sourcing components and for meeting the requirements of customers in the ASEAN region.

BEML, a mini ratna category 1 company, manufactures earth moving equipment for the mining sector. It is also planning to join hands with Coal India for entering into an agreement with a tyre company for manufacturing tyres for its equipment.

GAIL board approves Dabhol to Bangalore pipeline project

The board of directors of GAIL (India) Limited has given in principle approval for laying of the 730 kilometer Dabhol to Bangalore gas pipeline. The company management gave the go ahead for further time bound action and finalisation of the project execution plans.

Depending on the source and customer tie up, the pipeline will be designed to carry 16 million standard cubic metres per day of gas and will need an investment of INR 2,500 crore. The project will be appraised or updated in respect of investment, customer identification, routing of the pipeline and freezing the design parameters before final investment approval by the GAIL board.

The route of the proposed pipeline is from R LNG terminal of Ratnagiri Gas & Power Private Limited at Dabhol in Maharashtra up to Bangalore. The pipeline will pass through Ratnagiri and Kolhapur districts of Maharashtra and Belgaum, Dharwad, Haveri, Davangere, Chitradurga, Tumkur and Bangalore districts of Karnataka. With this pipeline, natural gas from RGPPL’s R LNG terminal can be supplied to industrial clusters in Maharashtra and Karnataka.

The Dabhol to Bangalore pipeline is among the 5 new pipelines for which GAIL has already received authorization in the first quarter of 2007. The other pipelines for which approval has been granted are
1. Dadri Bawana Nangal pipeline
2. Chainsa Gurgaon Jhajjhar Hissar pipeline
3. Jagdishpur Haldia pipeline
4. Kochi Kanjirkkod Bangalore Mangalore pipeline

GAIL will also be laying three pipelines to augment the capacities of Dahej to Vijaipur pipeline, Vijaipur to Dadri pipeline, Vijaipur to Auraiya to Jagdishpur pipeline with a carrying capacity of 74 million standard cubic metres per day. The total length of the new pipelines will be around 5,500 kilometer and the estimated investment on these would be INR 20,000 crore. When all these pipelines are commissioned by 2011-12, the total length of GAIL’s pipelines would be over 12,000 kilometer and the capacity is expected to increase from 148 million standard cubic metres per day at present to around 300 million standard cubic metres per day.

Maytas Infra secures mandate for Machilipatnam port

It is reported that Maytas Infra has secured the mandate to develop a port at Machilipatnam in Andhra Pradesh with the state cabinet formally approving a higher cost for construction.

Initially, the project was to be developed at Gogileru with an outlay of INR 1,255 crore. But later AP cabinet approved the development of project at Machilipatnam, even though it means an additional investment of about INR 300 crore. The developers have been asked to go ahead with the project with an assurance that the government would pitch in for the funds. As per proposals, the foundation stone for the port development is likely to be laid by the Ms Sonia Gandhi in April 2008.

Mr Anam Ramanarayana Reddy information minister of Andhra Pradesh said that the port is aimed at handling 12 million tonnes of cargo, which includes coal, fertilisers, cement and rice among others. He added that the port may also handle inputs for power plants and fertilizer units, and encourage ship building and repair. The government is also evaluating an ultra mega power project and may propose this to centre.

Mr Reddy said that, when the expression of interest was issued, the project was to come up at Gogileru. However, those dependent on Machilipatnam port protested against the move to have the port at Gogileru. The state government had appointed a committee of secretaries to examine the issue on various technical parameters. The committee may consider and recommend about additional cost for the developer.

REL net profit in Q3 of 2007-08 up by 50% YoY

Riding on a major tax credit of INR 89.50 crore, Reliance Energy Limited has clocked a 50.02% YoY growth in profits for October to December 2007 quarter at INR 301.60 crore up from INR 201.03 crore in October to December 2006 quarter. The operating income has fallen to INR 1,505.49 crore from INR 1,533.69 crore while the income from EPC and contracts business has fallen to INR 276.08 crore from INR 612.63 crore.

Reliance Energy has changed the accounting policy with effect from April 1st 2007, whereby the foreign exchange derivative instruments are re valued therefore INR 60.02 crore has been credited for the quarter to the profit and loss account on revaluation. REL’s erection, procurement and construction and contracts business posted a negative growth of 54% at INR 280.51 crore as compared with INR 613.94 crore.

REL’s aggregate revenue from energy sales during April to December 2007 was INR 3,774 crore against INR 2,726 crore up by 38% YoY. The aggregate sales of electrical energy were 7,197 million units compared to 6,637 million units up by 8% YoY.

REL has a capacity to produce nearly 1,000 MW of power and owns 50% of Reliance Power Limited. Reliance Power aims to use the money to fund its projects for 28,000 MW across India.

Darby Overseas invests INR 70 crore in Bhoruka Power

Darby Overseas Investments Limited has announced that its Darby Asia Mezzanine Fund II has invested INR 70 crore through an affiliate in Bangalore based Bhoruka Power Corporation Limited. BPCL is involved in the development and construction of small hydro electric and wind power generation projects.

Mr Richard H Frank CEO of Darby said that “BPCL represents an excellent investment opportunity to participate in the infrastructure sector. We are attracted to BPCL because of its strong position within India’s rapidly expanding renewable energy sector and its strong execution capabilities.”

PFC net profit in Q3 of 2007 up by 38% YoY

Power Finance Corporation Limited has reported a 38% YoY jump in net profit at INR 320.5 crore during October to December 2007 quarter up from INR 232.6 crore in October to December 2006 quarter. Total income rose by 35% YoY to INR 1,300 crore as against INR 954 crore.

PFC’s loan sanctions were up by about 12% YoY at INR 8,474 crore in during the October to December 2007 quarter as against INR 7,589 crore in during the October to December 2006 period.

The major projects sanctioned during the quarter included the INR 4,785 crore to Krishnapatnam Thermal Power project and INR 800 crore Lanco Amarkantak Power Private Limited.

BHPB bid for Rio - Rumors abound of a new bid

The Australian and UK financial markets are abuzz with rumours that mining giant BHP Billiton Ltd is set to make an improved takeover bid for Rio Tinto this week sending Rio Tinto's share price up by 3% last week.

Analysts are speculating that a revised offer might be comprise 3.5 BHP Billiton shares for one Rio share, plus a cash component.

Ms Samantha Evans spokeswoman of BHPB said that she could not comment on the speculation. She said "We are not commenting on any of those rumours at all. There seems to be one a day at the moment."

Mr Tom Albanese CEO of Rio was asked on Sky News on Sunday if he expected a revised bid from BHP Billiton soon. He said "I would not comment on speculation. There has been an awful lot of speculation. If the value is not there, it is not there. If it is there, it is there, but I would not want to speculate."

On December 21st 2007, the UK Takeovers Panel set a deadline of February 6th 2008 for BHP Billiton to announce its intention to make a firm and formal offer, or cease stalking Rio Tinto.

Steelmakers to shift to raw materials consolidation in 2008

As per a report by Reuters, global steelmakers are likely to focus their acquisition sights on raw materials in 2008 in a bid to reduce costs which are set to climb on the back of higher iron ore prices.

Mr Robert Miller senior MD of leading investment bank Miller Mathis, which advises the steel industry, told Reuters that "Those steel companies that are not self sufficient in terms of raw materials will be seeking out raw materials related companies.”

Mr Miller added that "There are a handful of major steel companies that are at or near self sufficiency of raw materials but there are many that are still dependent on world markets. I know of several major steel companies that are pursuing raw material acquisitions instead of focusing on buying primary producers.”

Mr Miller outlined that China, the world's top producer and consumer of steel, is among the countries which needs those raw materials the most. He said "If I were in China I would certainly be looking at raw materials acquisitions because China's big liability is they have too few raw materials for a country of its size and stature. What they need is to get raw materials to develop foreign markets for their products.”

Mr Miller believes China will soon join the rest of the world in permitting market-based transactions. He said "It would be quicker, easier and more cost efficient for China to achieve world class capability in steel by allowing foreign steel companies to partner with domestic steel makers.”

He opined that “I personally think China should enter into the Rio Tinto transaction. Because Rio represents about 30% of China's annual iron ore needs. This is a once in a lifetime opportunity for China to acquire such a huge amount of iron ore."

Mr Miller does not foresee any steel company taking drastic measures due to recession fears but thinks rising production costs could eventually curb enthusiasm for acquisitions. He said “There comes a point where you cannot pass on these cost increases anymore, then it begins to hurt profitability and if that happens your stock price will go down and you will not be thinking as optimistically about acquisitions."

Economic downturn may affect ThyssenKrupp - CEO

Mr Ekkehard Schulz CEO of ThyssenKrupp AG said that a possible cooling of the global economy this year would have a negative impact on the company's activities.

He said last week that “For 2008-2009 we still expect a positive development of sales, as long as an unexpected economic downturn doesn't hamper our business.”

ThyssenKrupp’s pretax profit for October to December 2007 quarter has declined by about EUR 700 million, down from last year's EUR 1.062 billion. However, the company reiterated it still sees pretax profit excluding one offs for the full year above EUR 3 billion and full year sales at EUR 53 billion.

BHPB bid for Rio - Rio to offload USD 10 billion assets

Mining Journal reported that Rio Tinto has appointed banks to manage the sale of as much as USD 10 billion worth of mines and plants. Rio said on January 16th 2008 that it plans to sell USD10 billion worth of assets in 2008.

The report cited Mr Guy Elliot finance director of Rio as saying that "Sales programs are under way. We are finding that strategic buyers are queuing up for each and every one of those businesses.”

Mr Elliot said “Losses from the collapse of the sub prime mortgage market in the US would not affect potential buyer’s ability to raise money to acquire assets.”

Rio Tinto drew up a USD 30 billion list of possible sales in November as part of its plan to repel BHPB. The assets for sale include base metals mines and uranium projects in Australia and the US, as well as some of the businesses acquired through its USD 38.1 billion purchase of Alcan Inc.

Iron ore price negotiations – Mr Batista sees minimum 40% hike

Bloomberg cited Mr Eike Batista Brazilian billionaire, who controls MMX Mineracao e Matalico SA, as saying that Iron ore producers will negotiate a price increase of at least 40% during annual talks this year with the world’s steelmakers.

Mr Batista said that “China is still in the middle of its cycle of growth, which should continue for many years. Demand remains stronger than supply.”

According to a report by analysts Mr Roger Downey, Mr Ivan Fadel, and Mr Leonardo Correa Credit Suisse recently raised its forecast for a price increase this year to 55%, up from an earlier prediction of 35%. They said iron ore demand was 25 million tonne short of supply in 2007, the tightest market since 2004 to 2005 when prices rose 72%.

US and Canadian steel inventories start a rise in December

According to the latest Metals Activity Report from US based Metals Service Center Institute, steel inventories at metals service centers in the United States and Canada closed 2007 up slightly from November 2007 levels as YoY shipments in both countries fell 4.1% from those of December 2006.

US steel inventories at the end of the year were up by 1% MoM to 12.26 million tons from November’s month end supply while Canadian inventories rose by 1.6% MoM to 1.15 million tons.

The report said that “Although shipments were below year ago levels again in December it appears that the liquidation phase of the inventory cycle may have come to end. Service center inventories of steel in the United States and Canada all increased in December. For the US steel segment, this is the first increase since the October 2006 inventory peak of 16.8 million tons.”

December shipments of steel products from US metals service centers totaled 3.34 million tons down by 4.1%. For the full year, US steel shipments were 52.18 million tons down by 6.8% YoY below 2006 steel shipments. The year end steel inventory figure was 25.7% lower than inventories at the end of 2006. At current shipping rates, the year end total inventory was equal to a 3.7 month supply.

In Canada, steel product shipments from metals service centers were 226,200 tons in December down by 4.1%. Full year 2007 steel shipments of 3.7 million tons were down 6.7% YoY from 2006 steel shipments. The year end inventory was 8.6% lower than inventories at the end of 2006 and, at current shipping rates, represented a 5.1 month supply.

The Metals Activity Report, based on data from metals service centers in the United States and Canada, is produced by the Metals Service Center Institute and a third party econometrics and strategy firm, McCoy, Scott & Co.

Founded in 1909, the Metals Service Center Institute has more than 420 members operating from about 1,200 locations in the US, Canada, Mexico, and elsewhere in the world. Together, MSCI members constitute the largest single group of metals purchasers in North America, amounting each year to more than 65 million tons of steel, aluminum, and other metals, with about 300,000 manufacturers and fabricators as customers

ThyssenKrupp board extends Dr Schulz chairmanship till January 2009

ThyssenKrupp announced the appointment of Dr Ekkehard Schulz as member and chairman of the executive board of ThyssenKrupp AG until January 23rd 2009.

It said the supervisory board will pass the corresponding resolution after January 23rd 2008.

Technip awarded ultra deep water pipeline contract by Shell

Technip has been awarded by Shell a contract for the ultra deep water Perdido oil field development in the Gulf of Mexico.

The contract covers engineering, fabrication and installation of one flow line and one steel catenary riser, with a total length of 8.24 miles. The pipelines will reach a maximum water depth of 9,700 feet along the route.

Technip’s operating center in Houston will execute this contract. The pipelines will be welded at the Group’s spool base located in Mobile in Alabama. Offshore installation will be completed using Technip’s deepwater pipe lay vessel the Deep Blue.

Under the terms of separate contracts, Technip is currently supplying the Perdido umbilicals as well as the Spar hull and mooring system. Moored in about 8,000 feet of water, this record breaking Spar will be the deepest spar production facility in the world and the first with direct vertical access.

Shell is the operator of Perdido, with a 35% interest. Other partners include Chevron with 37.5% and BP with 27.5%.

Salzgitter sees a good start to 2008

Mr Heinz Joerg Fuhrmann CFO of Salzgitter AG said that it had a very good start to 2008, beating expectations as declining inventories boosted orders. He added that “The profitability outlook is, I believe, clearly better than many people, and many experts, thought 6 or 8 weeks ago.

Mr Fuhrmann said that Salzgitter met its 2007 pretax profit target of EUR 1.2 billion and there is a good chance that sales were at least EUR 10 billion. It is scheduled to report preliminary 2007 earnings on March 6th 2008.

Mr Fuhrmann said that profit has been supported by strong sales of steel tubes and beams. He added that 2008 sales will climb further and declined to forecast profit for this year. Steelmakers will probably be able to pass on higher raw material prices to customers in 2008.

He further added that steel inventories began declining last year and may continue to fall. Smaller stockpiles may lead to a spring back in the market for flat steel and support stable markets for other steel products.

ArcelorMittal begins operation in Liberia

Dr Eugene Shannon lands, mines & energy minister of Liberia announced that ArcelorMittal has already begun operations in the country. He said that although it may not be at full scale, ArcelorMittal is now engaged in several activities in the country.

Mr Shannon said that ArcelorMittal is building houses, while its divers are assessing the port and engineers also engaged in other activities. He added that it has taken over an institution that was dormant but it has begun many activities, indicating that indeed it has started.

He stated that the operation of the company will create job opportunities for Liberians and as the world's largest steel company, will also have about 25% of its managerial staff as Liberians and that after 5 years it would increase to 50%.

It may be recalled that Mittal Steel had signed an agreement with the Liberian government in the tune of USD 1 billion. This amount was last month increased.

Coal & Allied 2007 production dips by 17% YoY

It is reported that Rio Tinto’s Coal and Allied is blaming coal chain constraints for a 17% drop in coal production at its four New South Wales Hunter Valley mines last year.

In 2007, the Hunter Valley operations, Bengalla, Mount Thorely and Warkworth mines produced almost 24 million tonnes of coal almost 6 million tonnes less than in 2006. Coal and Allied said that the drop in production is because of constraints in the Hunter Valley coal chain infrastructure.

Constraints in the Hunter Valley coal chain continued to limit coal production. Total coal produced in the fourth quarter was 11% YoY than the corresponding quarter in 2006 and 2% higher than the third quarter of 2007. There were no material operational issues impacting on Q4 production.

Lagoa da Prata meeting pig iron exporters

BNamericas reported that Brazilian pig iron producer Siderúrgica Lagoa da Prata is due to meet this week with trading companies interested in shipping abroad some of Lagoa da Prata's output.

Mr Mauro Luiz Dias president of Lagoa da Prata said that it has pig iron capacity of 72,000 tonnes per year and provides products to local specialty steel producer Aços Villares and to parent company Usibrás for billet production.

He added that "Prices on the domestic market are really bad and are not covering our industrial costs. Prices on markets abroad have never been so high in US dollars. But the unfavorable exchange rate stops us from exporting."

Mr Dias said that "We could receive proposals from trading companies for some USD 400 per tonne to ship our pig iron to China and the US. With this price level, we can think about exports."

Sales at Lagoa da Prata came in at some 60,000 tonnes in 2007 and are due to reach the same level in 2008 and exports in 2007 reached 12,000 tonnes and further sales outside Brazil for 2008 will rely on talks with trading companies.

SA Hall Longmore invests in expanding pipe capacity

It is reported that welded steel pipe manufacturer Hall Longmore, a wholly owned Murray & Roberts company, has invested about ZAR 245 million to increase production capacity at its Wadeville, Germiston and Duncanville, Vereeniging, pipe manufacturing facilities.

Forming part of an ongoing upgrade and capacity building program which started more than a decade ago, the latest upgrade will increase manufacturing capacity by about 250%. This will entrench Hall Longmore’s position as the largest specialist manufacturer of large bore welded steel pipes, coatings and linings on the African continent.

A significant portion of the capital investment has been apportioned to the streamlining of the company’s Wadeville plant in order to achieve a yearly throughput of some 200,000 tonnes of electric resistance welded pipe. The entire process, which includes a new three layer protective coating application, is synchronized from start to finish. This ensures a smooth flow throughout the manufacturing cycle from pipe milling to the final three layer coating.

In addition, the ERW plant upgrade makes it possible to manufacture pipe up to 610 mm in diameter, which was previously only available using the submerged arc welding process. The ERW process offers enhanced economies of scale when compared with the production of SAW pipe. Tooling for this stage of the upgrade is expected to be completed during the first half of 2008 and commissioning is scheduled for July 2008. The ability to manufacture 610 mm diameter ERW pipe now positions Hall-Longmore among a handful of leading inter-national pipe manufacturers.

The Duncanville plant upgrade is focused on the modification to its Sintakote coating facility. This is being done to accommodate 18 meter SAW pipe lengths to supply part of the 120 kilometer Vaal River Eastern Subway Augmentation Project.

Merrill Lynch posts worst ever loss for Q4 of 2007

Merrill Lynch joined Citigroup in reporting a sea of red ink in its fourth quarter accounts, saying that it lost USD 9.8 billion in October to December 2007 quarter due to USD 16.6 billion investment write downs and losses. It was the Merrill Lynch's worst ever quarterly performance in nearly 100 years of existence.

Citigroup recently reported a loss of USD 9.8 billion after write downs and losses of USD 18.1 billion.

Merrill's write downs include USD 3.1 billion related to contracts Merrill entered into with bond insurance groups to hedge against losses. Such groups are now under heavy pressure, raising doubts about the extent of the insurance they provide and two of the big names in this area, MBIA and AMBAC fell heavily today amid rising fears they could default, despite raising new capital in recent months.

Merrill also cut the value of asset backed collateralized debt obligations on its books by a huge USD 11.5 billion. CDOs are pools of mainly subprime housing mortgages and corporate bonds that are cut into tranches of varying risk and return and sold onto investors. Merrill was the biggest issuer of mortgage-backed CDOs. It was left with billions of dollars of unsold securities when the credit crunch hit last August after subprime mortgage defaults rose sharply.

Merrill's global markets and investment banking unit posted a loss of USD 15.9 billion driven by the USD 11.5 billion write down. It said that its net exposure to US asset-backed CDOs had dropped from USD 15.8 billion to USD 4.8 billion, suggesting that the worst of the write-downs could be over.

But the new housing starts news sent a message that the worst is not over, but the economy needs it to happen to start cutting the ever growing backlog of unsold houses. US Government figures showed that new residential building in the US last year suffered its biggest drop in nearly three decades. Combined with a worse than expected set of figures for December's housing starts and building permits, the Merrill news helped push Wall Street deeply into the red on the day.

Polish coal mine strike to continue

As per reports in Polish media, the strike in the Budryk colliery in the south of Poland will continue after 11 hour talks on the situation broke down last weekend.

The representatives of the miners’ union have failed to come to an agreement with the Jastrzebska Coal Company with which they are to be amalgamated and rejected their proposals.

The miners are protesting over parity issue with workers from Jastrzebska

For the last five days a hunger strike is being conducted by 13 miners, 1050 meters below ground, while over 150 miners occupy the mine’s premises above.

Latrobe Specialty Steel is staying in Pennsylvania - Report

It is reported that Latrobe Specialty Steel is staying in Pennsylvania to expand production capacity for vacuum melted steels and apparently plans to re use the former Valley Vulcan Mold Co site in Latrobe for the project.

With the expansion, Latrobe Specialty Steel plans to build a production plant that would house a 30 tonne vacuum induction melting furnace and at least 3 vacuum arc re melt furnaces. The project could add 40 to 50 jobs. The plant would include machining and other support infrastructure.

In May 2008, Latrobe said that it wanted to expand, but would look at sites outside Pennsylvania because of high electricity costs. Since then, industrial power users lobbied successfully for legislation that allows electric utilities to offer long term, fixed price contracts to its biggest power consumers.

Mr Dan Hennessy VP of manufacturing for Latrobe Specialty declined to comment on the company's plans in an interview last month. He acknowledged that the law allows utilities to offer long term, fixed price contracts to its biggest power customers. He added that "But they are still at the same high prices. It leaves large industrial customers at a cost disadvantage to producers in other states or other countries. It was a step in the right direction. We would like to see the legislation go further than it has."

Deutsche Bahn to work together with Port of Rotterdam

It is reported that Deutsche Bahn AG and the Port of Rotterdam Authority have intended to work together more closely. As per report, Dr Norbert Bensel chairman of the Transportation and Logistics Division of Deutsche Bahn AG and Mr Hans Smits CEO of the Port of Rotterdam Authority has signed a letter of intent for the purpose.

A key focus of the cooperation will be to improve the Port of Rotterdam's hinterland connections.

Mr Smits said that “Despite enormous investments in our infrastructure, the existing resources alone will not be sufficient to handle growing freight volumes. That means we have to make better use of existing resources. This will only be possible by intensifying cooperation across transport chains, because a port's success is dependent on the capabilities of the hinterland connections.''

Mr Bensel said that ''Our Intermodal Business Unit, Europe's leading company in combined transport services, and the largest port in Europe are natural partners here. Together we will optimize hinterland connections; it is precisely this long distance hinterland traffic that can be bundled which enables rail to maximize its advantages and bring more traffic to environmentally-friendly rail.”

Dr Sebastian head of the DB Intermodal Business Unit said that ''In Hamburg, rail has a modal split of 32%, whereas in the case of the Port of Rotterdam, it is currently only 11%. We still have a lot of room above that figure, and want to exploit this potential with new coordinated services, such as the creation of new hub and spoke concepts.''

The Port of Rotterdam is Germany's most important port in terms of freight handling both to and from Germany. Rotterdam was the first European port to break through the 400 million tonnes barrier, with a cargo throughput of 406 million tonnes in 2007.

Cape Town ports plans USD 613 million expansion projects

It is reported that Cape Town in South Africa has launched a USD 613 million expansion project to increase terminal handling capacity and improve port infrastructure. The move comes after Cape Town posted a 13% increase in volume in 2007.

Spearheaded by South Africa's state owned transport company Transnet Limited, among the key investments in the expansion of the port's container handling facility is the installation of 2 quay cranes manufactured by Liebherr of Germany and the replacement of straddle carriers with rubber tired gantries in its container yard operations.

To date, only Durban utilizes the more advanced rubber tired gantries. A total of 32 rubber tired gantries are to be commissioned in Cape Town. Aside from the equipment, the port's draft will be dredged 10 meters deep and its basin by 15.5 meters deep to accommodate bigger vessels.

Before the end 2007, the terminal marshaling yard would also be converted to a staging area. Nonessential facilities will be demolished and the terminal will be reconfigured to maximize stacking capacity and reefer storage. The expansion project is targeted for completion in 5 years. By that time, annual capacity is expected to increase from its current 740,000 TEUs to 1.4 million TEUs in 2012.

Transnet assured that while the civil works are ongoing, container handling operations will not be hampered. Containers will be temporarily serviced at the port's multipurpose terminal. It is spending ZAR 28 billion to modernize the country's ports by 2012.

Eskom to sell coal part of future export capacity at RBCT

It is reported that South Africa's electricity enterprise Eskom intends selling a large part of its export coal capacity in the expanded Richards Bay Coal Terminal.

Mr Bongani Nqwababa director finance of Eskom said that it wants to dispose of half of its holding in the RBCT linked South Dunes Coal Terminal as the asset is no longer core to Eskom.

Several coal juniors have expressed a strong interest in acquiring coal export capacity at a time of record global coal prices.

Romania ranks 1st within EU regarding construction works

Romania’s news agency Rompres reported that construction works have placed Romania 1st within the EU for the third consecutive month, with an annual growth rhythm of 32.6% in November 2007 after registering a growth rhythm of 38.1% in October and 40% in September 2007.

Poland and Slovenia trailed with a growth rhythm of 11.1% and 9.1% respectively.

Construction works in the EU 27 have registered an annual growth of 0.8% in November 2007, following a 3% growth in October. On the other hand, in the 13 member state Euro Area construction works have registered a 0.8% drop compared to the level registered in November 2006, following an annual growth rhythm of 2.8% in October 2007.

In Romania, construction works have registered a growth of 33.2% in November 2007 compared to the same month the previous year. The growth has made itself felt in all types of constructions like non residential buildings with 45.7%, engineering constructions with 32.7% and residential buildings with 26.6%.

On the other hand, in November 2007 the construction works have dropped by 6.5% compared with October 2007. Compared with the level registered in the previous month, the engineering construction works have registered a drop of 14.3% in November 2007, the non residential construction works have grown by 2.9% while the residential construction works have grown by 2.5%.

Kobe issues domestic unsecured Yen bonds

Kobe Steel Limited has decided to issue domestic unsecured yen bonds under the terms as set forth below

I Domestic unsecured yen bonds due January 23rd 2013
1) Name: Kobe Steel Limited series 47 unsecured bonds
2) Total amount of issue: JPY 10 billion
3) Denomination of bond: JPY 100,000,000 each
4) Interest rate: 1.19% per annum of the principal of the bonds
5) Issue price: 100% of the principal amount of the bonds
6) Redemption price: 100% of the principal amount of the bonds
7) Maturity date: To be redeemed in a lump sum on January 23rd 2013
8) Offering period: January 17th 2008
9) Closing date: January 23rd 2008
10) Method of issue: Public offering in the domestic market
11) Date of payment of interest on the bonds: Semiannually on January 23rd and July 23rd 2008
12) Status of the bonds: Unsecured by assets or guarantees
13) Fiscal agent: Mizuho Corporate Bank Limited
14) Underwriters: Mizuho Securities Co Limited

II .Domestic unsecured yen Bonds due January 23rd 2018
1) Name: Kobe Steel Limited series 48 unsecured bonds
2) Total amount of issue: JPY 10 billion
3) Denomination of bond: JPY 100,000,000 each
4) Interest rate: 1.81% per annum of the principal of the bonds
5) Issue price: 100% of the principal amount of the bonds
6) Redemption price: 100% of the principal amount of the bonds
7) Maturity date: To be redeemed in a lump sum on January 23rd 2018
8) Offering period: January 17th 2008
9) Closing date: January 23rd 2008
10) Method of issue: Public offering in the domestic market
11) Date of payment of interest on the bonds: Semiannually on January 23rd and July 23rd 2008
12) Status of the bonds: Unsecured by assets or guarantees
13) Fiscal agent: The Bank of Tokyo Mitsubishi UFJ Limited
14) Underwriters: Mizuho Securities Co Limited

Viet Nam invests in hydro power plants in Cambodia

VNA reported that Viet Nam has decided to invest USD 600 million to build two hydro power plants on the lower Se San River in Cambodia’s Ratanakiri and Kratie provinces.

According to the Cambodian Ministry of Industry, Mines and Energy the Lower Se San 1 and Lower Se San 2 hydro power plants are designed to have a combined capacity of over 500MW.

Documents to this effect were signed last June by representatives from the Cambodian Ministry of Industry, Mines and Energy and the Electricity of Viet Nam. Once completed, the two plants with a combined output of 2 billion kWh per year will ensure the supply of electricity for several areas in Cambodia and export to Viet Nam.

Mr Tun San Chief of the Cambodian Electricity General Department said that Cambodia will construct a series of thermal and hydro power plants, providing electricity for nearly 20 industrial zones. He said that Viet Nam’s investment in construction of hydro power plants would help Cambodia solve electricity supply for industrial zones and agricultural production areas.

Moody upgrades ArcelorMittal rating to 'Baa2/P2

Thomson Financial reported that Moody's Investors Service has upgraded ArcelorMittal's issuer, ArcelorMittal Finance and ArcelorMittal USA's senior unsecured ratings to Baa2 from Baa3. At the same time the short-term rating of ArcelorMittal Finance was upgraded to P-2 from P-3.

Mr Matthias Hellstern Moody's lead analyst for ArcelorMittal said 'The rating action was prompted by the now achieved visibility of successful integration efforts with synergy effects resulting in cost reductions of around USD 1.3 billion per 09/2007 and the commitment of ArcelorMittal's management to keep its net debt to EBITDA ratio below 1.8x, even if contemplating large sized acquisitions in order to maintain a solid investment grade rating.'

In addition Moody's has taken into account the stable outlook for the steel industry in general and the positive outlook in the Eastern European and other emerging markets which, due to ArcelorMittal’s strong asset base in these markets will benefit ArcelorMittal additionally.

It also said it has taken into account the improved and further improving vertical integration of the steel giant, which will help partly isolating it from negative price swings for iron ore and coking coal.

The Baa2 rating of the ArcelorMittal Group also reflects its unrivalled position as the most geographically diversified steel producer in the world, which is expected to help mitigating downturns in one region with potentially positive business environments in other regions.

Carrick Gold to spin off a nickel company

It is reported that Carrick Gold Limited is set to spin off its nickel opportunities to a wholly owned subsidiary, Condor Nickel Limited, which it will look to list on the ASX. Condor Nickel will hold all CRK's current nickel and base metal assets while CRK retains all its gold assets.

Carrick said that it completed the takeover of Shannon Resources Limited and in doing so, expanded its nickel resources and targets. It said however, Carrick and its shareholders have not witnessed a direct benefit as a result of the enormous nickel resource believed to exist among the combined tenements. Carrick said spinning off the nickel assets would provide greater clarity to both companies’ operations.

Mr Ted Leschke senior resource analyst of Shaw Stockbroking pointed out that while nickel stocks have been out of favour of late, recent corporate actions may be indicating that the nickel market has bottomed. He said over the last year, nickel prices have dropped from USD 50 million per tonne to under USD 30 million per tonne.

Carrick said in a statement that “The Directors of CRK believe that the continuing exploration success of the company's gold activities will be better reflected in the share price if the company maintains an exclusive gold focus.” It said it is in the process of preparing the relevant prospectus.

GIPI awards Oman ERW pipe mill contract to JK Engg

Gulf International Pipe Industry LLC announced that it had signed a steel supply and erection contract with JK Engineering & Construction Co Ltd of South Korea. The signing ceremony was held in South Korea and the contract was signed by Mr Masoud Al Barwani deputy CEO of GIPI and Mr Song, president of JK Engineering & Construction Co Ltd.

JK’s scope of work includes design, fabrication, supply and erection of steel structures for the plant building that will house the 24 ERW pipe mill with casing and fully integrated coating complex in the industrial zone of Sohar. The mill will be capable of producing 250,000 tonnes per year.

Mr Barwani said “We are very pleased to have achieved this milestone and shows our commitment to have this project executed and ready for commissioning by end of first quarter of 2009.”

The contract marks an important milestone for GIPI, following the signing of the credit agreement in Muscat recently with local and regional banks.

Zamil Industries posts record performance for 2007

Zamil Industries has announced its interim financial results for the twelve months ending December 31st 2007 showing a marked increase over 2006.

It net profits after Zakat contributions were SAR 206.5 million (USD 55.1 million) up by 7.8% YoY as compared to SAR 191.7 million (USD 51.1 million) in 2006. Its net profits for the same period in 2006 accounted for non operational profits from the sale of investment shares which amounted to SAR 20 million (USD 5.3 million).

Total turnover for the group was SAR 3,682.6 million (USD 982.0 million), a growth of 28.4% YoY as compared with same period last year.

Zamil Industrial operating profits posted an increase of 27.2% YoY from SAR 227.2 million (USD 60.6 million) in 2006 to SAR 288.9 million (USD 77.1 million) as at December 31st 2007.

Mr Khalid A Al Zamil MD of Zamil Industries said that "Our strong performance in 2007 was further enhanced by the Kingdom's strong and vibrant economy, as well as favorable conditions in the GCC. Zamil Industrial sector businesses have done remarkably well in the Saudi market, as well as regional and international markets."

Finnish Componenta expands its casting facilities in Turkey

Turkish Daily News reported that Finnish metal sector company Componenta is expected to invest some EUR 9 million to expand its casting facilities in Döktas in Orhangazi near Bursa in Turkey.

Due to the expansion of facilities the total casting capacity of Componenta, Döktas in Turkey will increase from approximately 140,000 tonnes a year to 180,000 tonnes a year. The new facilities are expected to be up and running by September 2008 and expected to boost employment in the Bursa region by creating 100 to 200 new jobs in Orhangazi.

Mr T Heikki Lehtonen CEO of Componenta said that the investment in Turkey is a part of its plan to invest EUR 12 million in expanding its casting capacity in Karkkila, Finland and Turkey. He added that "The expansion of our casting capacity in Turkey will make nearly 75% of the total investment. The expanded capacity, totaling 45,000 tonnes a year, is expected to increase our sales by approximately EUR 65 million.”

Mr Lehtonen said that "This capacity increase represents almost third of the whole casting capacity of Finland and 5% of the total casting capacity of Turkey. As such the expansion will be major."

Mr Lehtonen said that "The boom in infrastructure in China, India, Latin America and Easter Europe is boosting iron component business on macro level. In addition the growth of the automotive sector in Turkey is increasing our sales domestically."

Over the course of 2007, the operating profit of Componenta has increased from EUR 14.9 million to EUR 38.2 million. Net sales rose from EUR 362 million in 2006 to EUR 635 million in 2007.

Pakistan to build infrastructure at Karachi Shipyard

It is reported that Pakistan’s federal government has decided to build basic infrastructure for construction of surface commercial cargo ships and frigates including F 22 P frigates in the country at Karachi.

Pakistan government has allocated PKR 483.42 million for the fiscal year 2007-08 that would be met from local resources and releases would be made from federal public sector development program. It has already deleted Karachi Shipyard & Engineering Works Limited from its proposed list of privatisation in the recent past.

It is envisaged that if the shipbuilding project for local organisations like Pakistan Navy, Karachi Port Trust, Maritime Security Agency and Pakistan National Shipping Corporation are undertaken successfully, then KSEW is likely to get export orders from friendly countries. This would significantly contribute towards earning foreign exchange for Pakistan.

According to the paper the project would enhance and improve the productivity of KSEW and ever increasing demand of the industrial sector particularly of the shipbuilding industry of the country. KSEW is the only industry of shipyard in the entire country, which is fulfilling the needs of other local industries through shipbuilding and repair besides catering the vital needs of other local industries through manufacturing various items of general engineering utility. In order to undertake this project, it was felt mandatory to upgrade various machinery and infrastructure.

Construction of various types of ships by the government of Pakistan would provide benefits like creation of job opportunities, improvement in local vender industry etc. In addition, KSEW with the inclusion of these facilities would be able to construct more warships for domestic as well as international markets, which would be important source of foreign exchange earnings.

Re arrangement for upgradation of the KSEW workshop includes 6 areas including construction of foundation of installation of straightener machines and its production line, installation of NC cutting machines, construction of foundation, construction of foundation for two Gantry Cranes of lifting capacity of 50 tones each, construction of production line for edge, short blasting facility, ware house for storage of KOM and other civil works.

Bahrain aims to be the cargo hub in Gulf

Khaleej Times reported that the opening of Bahrain's new port of Khalifa bin Salman, operated by APM Terminals BV, is set to boost the kingdom's maritime industries.

Stakeholders want Khalifa bin Salman, due to be operational in late 2008, to be a hub port for Middle East Gulf cargo. Some forecasts expect container throughput at the world's smallest Arab state to more than treble within five years of the port's coming on stream.

APM Terminals, which signed a 25 year concession for Khalifa bin Salman and the existing port of Mina Salman in November 2006, has already invested more than USD 60 million in modern equipment and systems. Mina Salman was officially handed over to APM Terminals in December 2006, in what was one of the largest privatization projects in the region along with ownership of Khalifa bin Salman. APM Terminal's 25 year concession to operate Bahrain's commercial ports will begin with the construction of Khalifa bin Salman.

Mr Steen Davidsen MD APM Terminals Bahrain said that it is already reaping the benefits before the move to the new port. He added that “When we took over the port was managing 6 to 10 container movements per hour. In the space of a year we have improved that to 30 an hour.”

Mr Davidsen also said that while the move to the new port has been specifically designed to upgrade and increase the capacity for container and bulk cargo, the deep water facilities will also allow larger cruise ships to berth in a dedicated terminal. He added that “Improving our position in this luxury tourist will be a major boost for the economy.”

Oil majors keen to lay IPI pipeline in Pakistani territory

Daily Times reported that British Petroleum of UK has shown interest to lay gas pipeline under the India Pakistan Iran gas pipeline project in Pakistan territory.

The report cited a senior official as saying that “Mr Tariq Khamisani president of British Petroleum called on caretaker petroleum minister Mr Ahsanullah Khan last week and discussed matters pertaining to promoting Pakistan and BP cooperation in the oil and gas sector. He had also showed interest in laying gas pipeline under IPI project in Pakistani territory.”

He added that “Pakistan would lay pipeline in its territory and may award a contract to the oil companies. All international oil and gas companies would be invited to carry out the gas pipeline in Pakistan. Pakistan may float a tender to award contract after completion of feasibility study of the project.”

He said that Pakistan has contacted many other oil and gas companies to award the contract of laying gas pipeline under IPI gas pipeline project in Pakistani territory but they are seeking guarantee for security from the government of Pakistan. He said “Oil and gas companies want the security regarding the smooth supply of gas from Iran.

Pakistan government has estimated USD 3 billion investments for laying the pipeline in Pakistan territory. The official said the gas price being imported from Iran would be linked with Japan Crude Cocktail and the two options would be availed regarding laying the pipeline. If India joins the project, a 56 inch pipeline would be laid and if the India stays away from the IPI project then 36 inch pipeline would be laid.

Gazprom further increases gas exports to Turkey

It is reported that Russian energy giant Gazprom has announced another increase in its gas export to Turkey, from 38 million cubic meters a day to 40 million cubic meters a day.

Gazprom said the gas export increase to Turkey via the Blue Stream gas pipeline began early last week.

Gazprom had increased its exports from 30 million cubic meters a day to 38 million cubic meters per day in response to a request by Turkey's Butash Oil and Gas Company in December 2007.

Gazprom exported more than 90 million cubic meters of gas to Turkey beyond the agreed amount between December 25th 2008 and January 13th 2008.

Lakpass tunnel in Pakistan may be completed by April end

Business Recorder reported that work on PKR 928 million Lakpass Tunnel in Mastung district of Balochistan is in full swing and the project is likely to be completed by end of April 2008.

A source in ministry of communications said that "Construction of the Lakpass Tunnel will facilitate trade activity inside Pakistan and also with the central Asian republics and that better business opportunities will also be available to the locals of the area."

Lakpass Tunnel Project comprises construction of a 180 metre long tunnel and 4 and a half kilometre link road.

Chinese HR export prices likely to edge up

It is reported that Chinese hot rolled steel coil export offers have kept firm now and there is strong likelihood that prices would continue to edge up as producers continue to raise export quotations citing tight supply and excessive orders.

As per reports, most of the offers for commodity grade 4.75mm to 11.5mm HRC last week were at USD 690 per tonne on FOB basis while some steel makers were quoting USD 700 per tonne to USD 710 per tonne. In addition, the volumes available for exports were reported to be limited.

As per reports, some traders have taken position last week, with transaction price at USD 690 per tonne to USD 700 per tonne as they are quite optimistic and held that price is going to cross USD 700 per tonne on FOB basis sooner or later.

It is also learnt that some steel makers have already raised quotation to USD 720 per tonne on FOB basis for March and April shipment.

2nd West East pipeline to consume 4.4 million tonnes of steel

Mr Hou Chuangye deputy general manager of Natural Gas and Pipeline Company under China National Petroleum Corporation while speaking at an international seminar concerning liquefied natural gas held in Shenzhen recently unveiled the details of China’s 2nd West-East Natural Gas Transmission project.

Total pipeline lasts 8794 kilometers. The 4945 kilometer long main stem will apply X80 pipeline steel whilst the 3849 kilometer long main branch line will use X70 pipeline steel. Total steel consumption amounts to 4.4 million tonnes including 2.78 million tonnes of X80 pipeline steel.

He said that that Western part of China's second West-East Natural Gas Transmission project will be completed by 2009 and gas transmission will begin in 2010.

Mr Hou revealed the project would transmit 6 billion cubic meters of natural gas in 2010, and then 17 billion in 2011 and 30 billion in 2012. Gas for China's second West-East Natural Gas Transmission project mainly comes from Turkmenistan. As per the contract, Turkmenistan will export annually 30 billion cubic meters of natural gas during the coming 30 years.

Wuhan fixes the goals for 2008

WISCO announced its goal for 2008 in the conference on January 16th 2008. It hopes to produce 22 million tonnes of pig iron, 23.03 million tonnes of crude steel and 22.12 million tonnes of steel products in 2008. The sales income is expected to be over CNY 100 billion, while it confirms the profit would be CNY 8 billion to CNY 10 billion. Meanwhile, it is willing to reduce the cost of CNY 2.8 billion.

WISCO will further optimize product structure in 2008, in order to raise the proportion of high valued added and high technology added steel products to over 80% in total output. It would continue to boost the developing strategy for the middle and southwest of China, in order to further strengthen its ability in strategic resources protecting.

By the end of 11th five year plan, WISCO will complete three aims, including becoming top 500 enterprises in the world, becoming top 10 steel enterprises in the world and becoming top 3 Chinese steel enterprises.

In 2007, WISCO produced 16.24 million tonnes of pig iron, 17.02 million tonnes of crude steel and 15.75 million tonnes of steel products. Sales income is supposed to be CNY 80.2 billion, while the profit is CNY 9.3 billion. Total profit and tax could be CNY 16 billion.

Chinese rebar and wire rod export prices remain firm

It is reported tat export offers for rebar and wire rod maintained high levels last week despite decrease in Chinese domestic market prices as Chinese mills have not decided to export construction steels at lower levels citing the price surge in Middle East area and the jump in South East Asia market.

As per reports, export quotations, in general, for rebar remained at USD 730 per tonne to USD 735 per tonne on FOB basis and that for wire rod at USD 740 per tonne to USD 760 per tonne on FOB basis.

According to South Korean Steel Daily, Chinese steel mills have also shoot up export prices substantially for shipments to South Korea. Wire rod export offer have skyrocketed to USD 750 per tonne to USD 780 per tonne on CFR basis as compared with USD 720 per tonne to USD 730 per tonne in December 2007, USD 660 per tonne to USD 710 per tonne in middle November and USD 600 per tonne in October 2007.

The jump in export price is due to rise in export tax rate, higher raw material prices and growth in quotations for Middle East area. Export prices are likely to stay at high level since most steel producers and traders are upbeat on future performance.

Shougang steel exports cross 2 million tonnes in 2007

It is reported that Shougang Group exported 2.025 million tonnes of steel products in last year, plus the export of 79,000 tonnes by its subsidiary China Shougang international Trade & Engineering Corp. total exports added up to a new record of 2.104 million tonnes.

On the one hand, international demand required better varieties, qualities and services on the basis of stable growth. Competition became increasingly fiercer and anti dumping cases against China origin posted an uptrend. On the other hand, the appreciations of CNY and export tariff adjustment also squeeze exporters' profits. The steelmaker thus adjusted export product mix and raised exports of high value added products. Besides, it also added preventative clauses concerning risks such as national policy and exchange rate during its negotiations with foreign buyers.

Iron ore freight rates drop

Interfax China reported that Iron ore freight rates have slumped over the past few months on the back of slowing iron ore imports to China and uncertainty over the ongoing 2008 iron ore benchmark price negotiations. However, strong demand from China will support iron ore freight rates in the long run.

Mr Liu Changqing China Ocean Shipping Co analyst said "Domestic iron ore traders and steel mills are reluctant to sign new iron ore contracts with miners as the outcome of the 2008 contracted iron ore price negotiations is still uncertain."

Mr Liu added that "Forward Freight Agreement investors are biding their time in an iron ore market that is shrouded in uncertainty due to the iron ore price negotiations. This has resulted in gloomy performance on the FFA market, and aided the downside trend in iron ore freight rates."

Mr Gao Bo Shanghai Mysteel analyst said skyrocketing iron ore spot prices and freight rates have taken a heavy toll on small and medium scale Chinese steel mills that have cut production and iron ore purchases, despite the stockpiles of some steel mills running dangerously low.

An anonymous official with the iron ore import department of Laiwu Iron and Steel Group said "Our iron ore imports have decreased because of the shipping suspension from Brazil and the unexpected disruptions in Australia, and we don't know when shipment will return to normal levels."

Chinese steel mills received notice earlier this month from Australian miners, including Rio Tinto, that long term iron ore contract deliveries will be postponed due to a hurricane. The notice did not specify the length of the disruption. In addition, Vale has suspended operations at its Itaguai maritime terminal due to an accident in mid December last year which has reduced the company's iron shipments by 60,000 tonnes per day and allegedly led to the cancellation of up to 60 iron ore shipments to China.

Chinese nickel consumption in 111 months up by 15.5% YoY

Xinhua reported that China's apparent refined nickel consumption in January to November reached 183.50 tonnes up by 15.5%YoY. It included refined output of 105.70 tonnes up by 14.9%YoY and net refined import of 77.80 tonnes up by 16.3%YoY.

Refined nickel production in November was 7.670 tonnes, the lowest monthly level in the year. We found production decrease mainly occurred in Jinchuan which produced 6.840 tonnes in November while production elsewhere increased rapidly.

Refined nickel import recovered to 9,598 tonnes in November after dropped to 6,872 tonnes in September. It seems nickel import has tended to ease as domestic nickel pig iron production meets some of nickel demand. And nickel import seems to move at opposite direction with nickel price.

Nickel prices suffered decline after reaching height in the first half of 2007. Spot price of refined nickel has lingered between CNY 235,000 per tonne to CNY 240,000 per tonne. It seems nickel supply is quite abundant given nickel pig iron production. So it seems nickel ore import in December may be at the same level as in October and November.

EU consumers against AD duty hike in Chinese ferrosilicon

It is reported that EU will launch final vote on whether to levy anti dumping duty on imported FeSi on February 29th 2008 where local consumers have made an objection to the proposed duty.

Users claim that China's export tariff advances have resulted in FeSi price hikes in Europe. Local producers thus can gain considerable profits and it is unnecessary to impose anti dumping duty on imported FeSi.

They believe a fresh anti dumping duty will further drive up FeSi price, harm steel industry in European countries and lead to mass unemployment.

Iron ore price negotiations – Walking out, a bargaining tactics

Interfax China reported that Baosteel's walk out of the annual long term contracted iron ore price negotiations with iron ore miners which a common bargaining tactic often used during the negotiations. The comments came in response to an Australian media report last week that said that long term iron ore contract negotiations recently grounded to a halt after Baosteel walked out of negotiations with major iron ore suppliers BHP Billiton, Rio Tinto and Vale, dismissing price demands of miners as far too high"

Tangshan Iron and Steel Group raw material department official who wished to remain anonymous said that "It is not surprising that negotiations sometimes breakdown when the two sides are unable to reach an agreement. Last year's iron ore price negotiations concluded in December 2006, but that doesn't mean that year's will end that early, and we are confident that Baosteel will take its time and get a better price for the Chinese steel mills that it represents."

The official said "Irrationally high inflation in contracted iron ore prices for this year will harm Chinese steel mills and only bring short term profits to miners. Moreover, we believe that Baosteel and the iron ore miners will put sustainable growth before short sighted profit making."

Mr Gao Bo Mysteel analyst said "There's no need to make a big song and dance about this halt in the negotiations. The deadline for the annual iron ore price negotiations is at the end of March, and a final agreement will be arrived at by that time, or prices will remain the same as last year."

BaoSteel has later denied this news.

China's wire and cable industry to increase capacity

According to China Machinery Industry Federation Construction of ultra high voltage power projects is well underway alongside China's fast power grid development in recent years, creating huge market for wire and cable industry with an annual average growth of 15%.

At present, total industrial output value has exceeded CNY 400 billion enabling China to surpass the United States to become the top wire and cable producer in the world.

Based on technology introduction and research and development, China's wire and cable industry has formed huge production capacity and formed a complete industry system. Statistics show that of wire and cable enterprises in China, state owned enterprises only account for 15% while foreign funded enterprises and private enterprises take a share of 25% and 60% respectively.

Siemens to supply equipment for 2 strip processing lines in China

It is reported that Siemens Metals Technologies has received orders to supply equipment for strip processing lines to two steel producers in the north east of China. Dynamic air knives for two hot galvanizing lines are to be installed at Tangshan HengYuan Coating & Galvanizing Co LTD and a new skin pass mill at Tonghua Iron and Steel Co Ltd in a processing line for which Siemens already supplied a tension leveller. The two projects are scheduled for completion in summer 2008.

Tangshan HengYuan located in Hebei province operates a production plant with an annual capacity of around 3 million tonnes of crude steel. For two galvanizing lines of the company, Siemens is supplying two dynamic air knives. The systems are part of a project which is aimed at increasing line productivity. The order also covers the installation and commissioning of the dynamic air knives as well as customer training.

In Jilin province, the state owned Tonghua Iron and Steel Group operates a production complex with an annual capacity of around 4 million tonnes of steel. Up to now, the company has mainly produced structural steel as well as special steels for a wide variety of applications. Within the framework of an investment program for expansion of the production range to include high-quality flat products, a new hot-galvanizing line is currently being built.

Metals Technologies a business unit of the Siemens Division Industry Solutions is one of the world's leading engineering and plant building companies for the iron and steel industry as well as for the flat rolling sector of the aluminum industry and for open-cast mining. MT which was created from the integration of Voest Alpine Industrieanlagenbau, Linz/Austria, plus the electrical engineering product business and automation solutions of Siemens provides a comprehensive range of supplies and services for all related technological processes and integrated automation solutions for the entire life-cycle of metallurgical plants.

Sinosteel sales in 2007 jump up by 83% YoY

State owned Sinosteel Corp, China's leading raw materials and service provider announced that its 2007 sales increased 83% as the company restructured its business.

According to Mr Huang Tianwen president of Sinosteel that Sinosteel Corp notched up CNY 111.24 billion in sales last year and 180% profit growth.

Last year, Sinosteel signed a deal with China's largest steelmaker Baosteel, under which the two companies will boost cooperation on the supply of iron ore and chrome ore, ferroalloy and mining equipment.

He said the company is also preparing for an IPO. It plans to reinforce its resources development, trade and logistics, and engineering, science and technology. He added that the company has increased its iron ore and chrome ore capacity.

China considering restart of steel futures trade

According to official with Beijing Antaike that China is considering restarting steel futures trade soon. Antaike said that "Recently China's Iron and Steel Association held a meeting with major Chinese steel producers, discussing the issue of restarting steel futures trade.”

CISA was not available for comments.

Antaike said "Chinese domestic steel prices are volatile, so setting up a steel futures trade platform can ensure stable prices, protecting companies from losses due to erratic prices.”

An official with Shanghai Futures Exchange said since the setting up of a steel futures exchange would need the approval of the China Securities Regulatory Commission there is no firm schedule when exactly we would start steel futures trade."

Antaike said China had a steel futures trade platform in 1994, but the government stopped it because of too many speculative activities.

Shenhua post 21.8% surge in 2007 coal sales volume

China Shenhua Energy Company Limited has announced that it sold 208 million tonnes of coal in 2007 up by 21.8% over 2006. Statistics also show that Shenhua's coal sales amounted to 19.6 million tonnes in December.

Shenhua has boosted its annual production capacity to meet rising market demand in recent years. Its output in 2007 totaled 158 billion tonnes up by 15.7%YoY. Included were 13.5 million tonnes produced last December.

China's policy of curbing the export of resource products has cut the country's coal exports, which registered a YoY decline of 16% in 2007. Of the 208 million tonnes of coal sold by Shenhua in the year, 24 million tonnes were exported only up 0.4% over 2006.

Dalian exchange may launch coke futures soon

Mr Liu Xingqiang during a recent meeting disclosed that Dalian Commodity Exchange has done research on coke futures and its listing will speed up this year, in order to start trading as soon as possible.

According to Mr Liu, the government even put futures trading on the Northeast China development planning, bringing good timing for growth of the commodity exchange.

In 2008, Dalian Commodity Exchange will try to strengthen research of new breed, intensify service function of the futures for the spot market and expand R&D on option and commodity index etc.

Aside from coke, it also aims to put live pig on trade at an early time this year. Last year, Dalian Commodity Exchange added futures products from 5 to 7.

Tianjin Port sees soaring throughput in 2007

It is reported that duo to the rapid growth of foreign trade, Tianjin Port, the largest port in north China, has handled 300 million tonnes of cargo in 2007 up by 20.2%YoY.The turnover of the 20 foot equivalent units of container also increased by 19.4% to 7.103 million in 2007.

Mr Yu Rumin president of the Tianjin Port Co Ltd attributed the rapid growth to the development of the newly established Binhai New Area, a state-level industrial zone approved in Tianjin. He added that the port aims at 330 million tonnes of freight traffic and 8.5 million of container in 2008.

According to Mr Yu the Tianjin Port expanded its business with more shipping companies in 2007. Now it launched shipping business in more than 100 lines and has established trade ties with more than 400 ports in over 180 countries and regions in the world. The port has also been updating its sea lanes, which now are able to accommodate vessels with 250,000 DWT.

Mr Yu said that to conform to the fast development of the Tianjin Port, the government has planned to invest CNY45 billion from 2007 to 2010on the port infrastructure construction. By 2010, the port will be able to host vessels with 300,000 DWT and it will also have more than 80 berths for vessels above 10,000 DWT.

Ukrainian steel output in 2007 by 5.5%YoY over 2007

Millennium Capital reported that the 12 large Ukrainian steel mills increased crude steel output in 2007 by 5.54%YoY to 37.58 million tonnes and rolled steel output by 5.12% YoY to 32.07 million tonnes.

Among theses producers, the most impressive growth was shown by Azovstal, EMZ Group and Alchevskiy Steelworks. The last two mills underwent impressive modernizations, installing new blast furnaces and the first oxygen converter at Alchevsk.

1. Pig iron

(In million tonnes)

2. Crude steel

(In million tonnes)

3. Rolled steel

(In million tonnes)

Bekaert to invests in Lipetsk Special Economic Zone

It is reported that Bekaert intends to invest in a new steel cord production plant in the Lipetsk Special Economic Zone. This investment of more than EUR 97 million will take place in phases over the period 2008 to 2013. The first phase is scheduled to enter production in 2010.

With this new investment, Bekaert is responding to the rising local demand for steel cord products for tire reinforcement generated by Russia’s rapid economic growth. The Lipetsk region about 400 kilometers south of Moscow is strategically located close to the target markets, with good logistics, good access to energy supplies and a skilled labor force.

Mr Baron Paul Buysse Chairman of Bekaert’s Board of Directors said that “Expanding our position in Russia is entirely consistent with Bekaert’s strategy of sustainable profitable growth. The decision to set up our own production platform in Russia is proof of Bekaert’s faith in the long-term potential of this country. Local production will enable Bekaert effectively to meet the rapidly growing demand for top quality products.”

Bekaert already has a portfolio of customers in Russia for steel cord products for tire reinforcement, steel fibers for concrete reinforcement and other specialized wire products. Bekaert’s Russian customers are currently being supplied by its plants in Central Europe.

EC approves Metinvest buy of Trametal and Spartan

Thomson Financial reported that the European Commission has cleared Metinvest BV's proposed acquisition of Italy based Trametal SpA and Spartan UK Ltd. No financial details were disclosed.

The transaction was reviewed under the EU's 'simplified' merger review procedure for cases which the commission believes do not pose competition concerns.

Trametal and Spartan manufacture hot-rolled flat steel.

Metinvest to supply iron ore to IUD

Metinvest's has announced the signing of a three year contract on raw materials supplies to Industrial Union of Donbas. Metinvest will supply 10 million tonnes of pellets, 11 million tonnes of concentrate and 2 million tonnes of flux materials over 2008-2010.

While the pricing mechanism still remains unclear the deal is positive for IUD’s Alchevsk Steelworks and Dniprovskiy Steelworks. By signing the contract, IUD mainly solved its urgent iron ore supply issue.

Explosion at Shakhtarska-Hluboka coalmine kills 2

Ukrainian News Agency reported that on January 19th 2008, two miners were killed and two more injured in an explosion occurred at the Shakhtarska-Hluboka coalmine at Shakhtarsk in Donetsk region of Ukraine.

Ukrainian News quoted Ms Maryna Nikitina press secretary of the territorial department of the State Committee for Industrial Safety and Mine Supervision in Donetsk region as saying that the blast happened on January 19th 2008 at 6:25 PM at the first eastern airway of the bed N8.

Ms Nikitina said "A day before blasting operations was being held and on January 19th 2008 shaftmen received an order for mucking. When they were digging a hole with a crowbar, they hit a non blown shot with this actuating its detonator. The blast gravely wounded two of the shaft men, the other two sustained severe injuries and was taken to an intensive care unit.”

All the mine operations are suspended and a special commission, chaired by deputy had of the Industrial Safety Donetsk regional department Mr Leonid Marchenko, is now working at the coalmine.

Uralmash to upgrade SevGOK equipments

It is reported that Uralmash Machine Building Corporation and the Ukrainian SevGOK signed an agreement regarding the delivery of equipment and the technical data package needed to restore SevGOK’s Lurgi roast machine production line. The contract value is estimated at more than RUB 500 million.

The roast machine, whose total area comes to 278.25 square meters, was designed by Lurgi, the German manufacturer and launched at SevGOK in 1975. There were several enterprises interested in restoring the equipment, including the Italian Danieli, yet the SGOK decided to work with Uralmash.

The major pieces of equipment, including the automatic process control system, will be designed by Uralmash’s experts. The roast machine is to be made at Yekaterinburg based Uralmashzavod and Orsk-based ORMETO-YUMZ Heavy Engineering Joint Stock Co in 2008.

According to the corporation’s press officer, they had the advantage of knowing how to employ the greatest number of the roast machine’s currently existing components; what is more, they are to use the modern energy saving gas flow standards designed and developed by TOREX. Finally, Uralmash has a lot of experience in manufacturing of roasting equipment and delivering it within a limited time period, while maintaining the quality of their end product at the outstanding level.

This restored and upgraded roast machine is to become much more reliable and almost fully automated, which cuts down on energy spending and harmful atmospheric emissions. All the innovations that the machine is to be fitted with have already been successfully employed at Mikhailovskiy, Lebedinskiy, Kostomukshskiy and Sokolovo-Sarbaiskiy ore mining and processing enterprises.

Ferrexpo surges on hope for jump in iron ore price

Reuters reported that Shares in London listed Ukrainian iron ore producer Ferrexpo surged recently, swimming against a weaker mining sector, on expectations that iron ore contract talks would result in sharply higher prices.

Shares in Ferrexpo, the world's 12th largest producer of iron ore pellets, shot up as much as 6.7% and was trading 2.6% higher at 249 pence at 1210 GMT compared with a 3.7% loss in the UK mining index

London analyst who declined to be named said "The reason is that sentiment around iron ore is very positive at the moment.” He added that investors also welcomed news that the European Union on Wednesday cleared the way for Ukraine to join the World Trade Organization but bullishness about iron ore prices was the main driver.

Ferrexpo which owns one of the world's biggest iron ore resources plans to double production to around 55 million tonnes by 2014 by developing new mines.

4 iron ore deposit in Yakutia on block in March

FIS reported that in March, four Russian metallurgical companies will compete for iron ore deposits in Yakutia, Tayozhnoye, Desovskoye, Tarynnakhskoye and Gorkitskoye. The names of the companies have not been disclosed.

The auction is scheduled for March 12 and will be held in Moscow in Rosnedra's headquarters.

The auction's conditions include the construction of concentrating factories of the total capacity of 26 million tonnes of ore per annum, which are to start working at projected capacity in 12 years after obtaining the license and also the construction of the metallurgical complex of the capacity of 5 million tonnes of steel.

Russia could become largest car market in Europe by 2011

Ms Elvira Nabiullina Economic Development and Trade Minister f Russia told representatives of leading investment companies of the United States, the United Kingdom, Germany, Austria and Singapore that Russia's auto market could become the largest in Europe by 2011.

Ms Nabiullina said that "Foreign companies are gladly investing money in consumer oriented industries of Russia due to the sustainable growth in incomes. Foreign investments in the Russian car industry are an illustrative example, as this country ranks third in Europe by the size of its automobile market. This growth may make us the leader by 2011."

She lauded sustainable economic growth, large investments in various economic sectors and the budget surplus achieved in 2007.

Ms Nabiullina said the growth in investment in innovative industries will depend on the friendly business environment in Russia, the establishment of new agencies bound to support foreign investors, and the maturity of existent development institutions.

These companies are making big portfolio investments in Russia.

Interpipe to merge Nikopol assets into Interpipe Niko Tube

Interpipe announced last month end that Interpipe Nikopol Pipe and Interpipe Niko Tube are to merge into one entity named Interpipe Niko Tube.

The transaction is aimed at streamlining management. Mr Kostanetskiy, the former financial director of Niko Tube is to be appointed as CEO of the combined company.

The merger is logical as both plants actually share a common production site on the former Nikopol Pivdennotrubnyi Plant.

ChTPZ 2007 shipment in 2007 up by 10% YoY

FIS reported that in 2007, Chelyabinsk Tube Rolling Plant and Pervouralsk New Pipe Plant shipped 10% more products to customers as compared with 2006.

Shipments of large size pipes totaled 593,400 tonnes a 16% growth as compared with 2006. The plants' long standing customers include Gazprom, Transneft and vertically integrated oil companies.

OMZ elects new board of directors

It is reported that recently shareholders of Open Joint Stock Company United Machine building Plants convened for an emergency meeting to discuss amendments to the Charter, Regulations on Board of Directors, Regulations on Executive Board, Regulations on Audit Commission of OJSC OMZ, and election of the Board of Directors of OJSC OMZ.

The documents were redrafted according to the amended Federal Law “On Stock Companies” and international experience in the sphere of corporate law.

The Board of Directors of OJSC OMZ is composed of 9 members
1. Mr Bakatin Dmitry advisor to Moscow representative office Sputnik Investment Limited
2. Mr Borisov Evgeny advisor to Gazprombank
3. Mr Grishchenko Sergey ED Corporate Financing of Gazprombank
4. Mr Kantserov Farid deputy chairman of the board of Gazprombank
5. Mr Matveev Alexey deputy chairman of the board of Gazprombank
6. Mr Seppo Remes senior advisor and member of the board of directors of CJSC FIM Investment Fund
7. Mr Skatershchikov Sergey VP for strategy and development of OJSC MTS
8. Mr Chernyshev Valery GD of OJSC United Machinebuilding Plants
9. Mr Vladimir Yurkov GD of CJSC Forpost Management

United Machinebuilding Plants is a heavy engineering company specializing on engineering, production, marketing and service maintenance of equipment and machinery for the atomic energy industry, oil and gas industry, mining industry, on production of special steels and provision of industrial services. OMZ production sites are located in Russia and Czech Republic. The major shareholder of OMZ is CJSC Forpost Management. The company’s strategic financial partner is Gazprombank.

Syndication soon for Evraz USD 3.2 billion loan

Reuters reported that Russian steel major Evraz Group will launch syndication recently of a USD 3.214 billion structured multi tranche loan, which will be used for refinancing and for general corporate purposes.

As per report the largest commitment level on offer to banks is a USD 150 million ticket, with several smaller levels also on offer.

Evraz announced in November that the deal had been underwritten by coordinating bank ABN AMRO and 10 mandated lead arrangers.

The mandated lead arrangers are ABN AMRO, Bank of Tokyo-Mitsubishi UFJ, Barclays, BNP Paribas, Calyon, Commerzbank, Deutsche Bank, ING Bank, Sumitomo Mitsui Banking Corporation and UBS. Deutsche Bank was appointed facility agent and security trustee for the syndicate.

Evraz said the loan pays a margin of 180 basis points over LIBOR and is split between a USD 2.714 billion, five year tranche secured on trade receivables and a USD 500 million, three year unsecured tranche.