Indian steel majors roll back prices

India’s major steel producers have agreed for a partial roll back on the price rise carried out by them in February 2008 by INR 1000 per tonne for TMT and rounds and INR 500 per tonne for other steel products, to be effective immediately. This was done in response to appeal made by Mr Ram Vilas Paswan union minister of steel. The steel producers have also agreed to the appeal of Mr Paswan to maintain their price line.

Concerned with the recent price hike in steel commodities, Mr Paswan convened a meeting with the CEO’s of major steel producers. The meeting was attended by SAIL, RINL, Tata Steel, Essar Steel, JSW Steel, Jindal Steel & Power and Ispat Industries Limited. A preliminary discussion with these major steel producers had already taken place in a meeting under the chairmanship of steel secretary, to discuss the issues concerning steel price.

During the meeting, Mr Paswan conveyed the concern of his Government regarding the impact of sudden price hike in steel commodities carried out by the steel producers in the last two months period. He stated that the price hike, apart from hitting the common man due to its cascading effect on inflation, would also affect many of the downstream consumer industries such as small and medium manufacturers and construction sectors.

Mr Paswan thanked the Indian steel industry for responding to the request of the Government in the interest of the nation. He also assured the Indian steel industry regarding the commitment of the Government in initiating suitable policy directives as well as facilitating the growth of the steel sector as a whole so as to augment the supply side in order to bridge the demand-supply gap and maintain a stable price line.

The steel industry however expressed its concern over the rising input costs due to steep hike in the prices of iron ore, coking coal, met coke, ferroalloys and cost of transportation.

Jharkhand recommends iron ore mines for Arcelor Mittal

Ranchi Express reported that Jharkhand government has cleared the file related to allotment of Meghataburu and Karampada iron ore mines in favor of ArcelorMittal for its 12 million tonnes integrated steel plant in Jharkhand.

As per report, the matter has been referred to the central government for final approval. The report said that “A copy of the State Government's clearance has also been sent to the steel ministry and the final decision regarding the allotment of Meghataburu-Karampada will be taken by the ministry of mines.”

The Arcelor Mittal will require 600 million tonnes iron ore in 30 years for its 12 million tonnes.

NMDC eyeing stake in Canada iron ore mine

It is reported that National Mineral Development Corporation has submitted an expression of interest for a stake in an iron ore mine in Canada.

Mr Ashok Gupta GM of NMDC said that "We have given an expression of interest."

He added that the mine had proven reserves of 1 billion tonnes of iron ore.

Anti POSCO remove survey poles

BS reported that anti POSCO activists have demolished 10 to 12 poles erected by POSCO site survey teams for demarcation of land at Gobindpur village bordering Dhinkia leading to tension in the area.

As per reports, the activists of POSCO Pratirodha Sangram Samiti, which is spearheading the agitation against the steel project, held a meeting in Dhinkia, where hundreds of villagers including women had gathered and they later demolished 10 to 12 poles at Gobindpur border later.

Mr Abhaya Shaoo president of POSCO Pratirodha Sangram Samiti said the district administration conducted the survey by deploying police forces but no one had yet been convinced about the POSCO survey.He said that “If the villagers were actually supporting the survey then there would not have been the necessity to deploy 13 platoon police forces.”

He added that villagers of Dhinkia would talk to the administration about the POSCO survey and the steel project after withdrawal of police force from the area.

POSCO economic survey report to be submitted in 10 days

SNS reported that detailed socio economic survey report for the POSCO steel project will be submitted to the government within 10 days for valuation of rehabilitation package.

Mr Pramoda Kumar Meherda district collector of Paradip said that about 95% of socio economic surveys have been completed at Gadakujang, Nuagaon, and Gobindpur village under Dhinikia panchyat. He added that district administration has decided to conduct socio economic survey in 8 villages of 3 panchayats ignoring Dhinkia village. Survey and land demarcation survey work have been completed peacefully and successfully in 7 villages of 3 panchayats.

Mr Meherda informed that 1930 house holds have been covered under socio economic survey, while 2315 betel vine including 1085 in Gobindpur village, 11 in Bhuyianpal, 300 in Polang, 15 in Noliashai and 904 in Nuagaon village have been covered. Similarly, 282 families have been identified for displacement, which include 70 families in Gobindpur, 4 in Bhiyanpal, 13 in Polang, 187 in Noliashai and 8 in Nuagaon village.

Mr Meherda observed that villagers protested survey work on first days because they were unaware about POSCO socio economic survey. Earlier villagers had perceived that survey means demolition and violence in their villagers, but officials convinced about survey, and they readily cooperated.

Meanwhile, Mr RK Sharma district superintendent of police has expressed that no untoward incidence has occurred during survey due to cooperation of villagers. He informed that 6 platoon police survey have been deployed to maintain law and order situation and to give security to survey teams and local villagers.

Port movements temporarily suspended at Vizag Port

It is reported that an accident occurred at Vizag port, while hauling out MV Splendor for sailing from berth EQ-6, port tug collided wit the pilot launched in the channel.

As a result of this mishap and as per preliminary reports the pilot launched grounded inside the channel and the engine driver of the pilot launch could not survive the accident.

Since then, all the port movements are temporarily suspended and all the Vizag Port senior officers and other staff are attending for the operation of the pilot launch.

GAIL to complete Vijaipur Dadri Bawana pipeline by January 2010

It is reported that, in a bid to supply gas to the proposed power plant at Bawana, GAIL is planning to complete its Vijaipur Dadri Bawana natural gas pipeline project, within a period of 24 months with a total project cost of around INR 4,000 crore.

The proposed pipeline will have throughput capacity of 14.1 million standard cubic meters a day of gas. The laying of pipeline will be complete by January 2010 and the pipeline will be commissioned by March 2010.

GAIL is also chalking out plans of installation of compressors at Vijaipur and Jhabua with a project cost of INR 1,390 crore by 2010.

19 firms interested in Rajpura power project

Projects Today reported that nineteen companies have expressed interest in developing the 1,320 MW coal based thermal power unit at Village Nalash near Rajpura in Patiala district of Punjab.

The companies include
1) Bhilwara Energy
2) CLP Power
3) DS Construction
4) L&T
5) Reliance Energy
6) TATA Power
7) Nagarjuna Construction
8) GVK Infrastructure
9) JSW Power Trading
10) KSK Energy Ventures
11) Sriram EPC
12) Lanco Infratech
13) Siti Energy
14) Sterlite Industries
15) Devona Thermal Power & Infrastructure
16) Subhash Projects
17) EMCO Energy
18) Energy Infratech

Punjab State Electricity Board has set up a special purpose vehicle called Nabha Power Limited for the project. Nabha Power will take actions to ensure linkages for coal, water and to undertake studies for transportation, hydrological, topographical, EIA and other studies and surveys necessary for preparation of project report.

Ground work of the project has already been started and site of the proposed project has been cleared by the Central Electricity Authority. Land to the extent of 1,085 acres has been identified and land acquisition for the project has started.

White goods makers looking to replace steel

BS reported that sharp rise in prices of steel and copper forces consumer durables makers LG and Godrej to search for an effective alternative.

Sometime next year, South Korea based consumer durables maker LG Electronics hopes to have a new alloy that will be able to substitute steel. Its research and development wing is testing the feasibility of metals and composites. A senior executive of LG’s India operations said that “We should come out with a solution by 2009.”

Like LG, Godrej Appliances too is looking at alternatives. Mr Kamal Nandi VP sales & marketing at Godrej & Boyce said that “Our R&D division is looking at a number of composites to replace steel. The composite will be finalized on the basis of strength, malleability, sturdiness and other such parameters.”

Steel, which comprises about 35% of the raw material that goes into the making of air conditioners, refrigerators and washing machines, has become 11% costlier in the past 12 months. To add to the woes of consumer durables makers, copper too has become more expensive. According to industry experts, price hikes for inputs are absorbed by manufacturers initially. But ultimately, some of the cost has to be passed on to the customer.

What consumer durables manufacturers are trying now is already happening in the auto industry. Auto majors are increasingly utilizing aluminum, plastic and fiber glass in place of steel for certain auto parts. Steel, which once made up nearly 90% of raw material for cars, now comprises about 60%.

Bihar Tubes bags INR 15 crore orders from HP government

Bihar Tubes Limited has bagged order worth INR 150 million from irrigation & public health department government of Himachal Pradesh.

Mr Mukesh Jain president marketing of Bihar Tubes said that "Regular orders from prestigious government agencies like BHEL, irrigation & public health department and state governments not only shows our quality and commitment but also demonstrates Bihar Tubes Limited as significant player of the industry."

Government urged to reduce state levies and paperwork

Mr Tushar Mehendale MD of ElectroMech said that the union budget can be a great way for the central government to address the issues of local municipal corporations. According to Mehendale, the levies on inter state sale of goods should be removed or alternatively, red tape requirement of issuing the ‘C’ forms should be done away with.

He said that "In states like Maharashtra, imposing anachronistic levies like octroi, entry tax, etc which make it very difficult to plan logistics and add unnecessary costs and hassles. While these levies do form a major source of income for the corporations, some alternate arrangements have to be implemented in this budget like the much discussed cess on VAT."

Mr Mehendale further added that "On analysis, we found out that almost 70% time of people in the accounts department is spent unproductively on ensuring all sorts of compliances like income tax, TDS, service tax, excise duty, customs, VAT, octroi, central sales tax, professional tax, etc. It is about time the government really rationalized all these different taxes and made life easy for people engaged in seriously trying to compete in the global industry."

Builders fear delay in projects due to hike in steel prices

Ludhiana Builders Association said that many of the mega projects in the city may get delayed because steel accounts for 33% of the cost of any project. It added that the price of steel has been increased by INR 8,000 per tonne in the past few weeks.

Mr SS Mavi a patron of the association said that “This can happen even in the other parts of the state and the country as well because malls and housing projects worth crore of rupees are coming up across the country. For a INR 100 crore project, the escalation will not be less than INR 5 crore. The builders can not pocket it so easily. So there are chances of projects getting delayed or being scrapped altogether.”

The companies who have included an escalation clause may have to revise the rates of construction. This had happened when the Ludhiana elevated road project was underway. Due to a hike in prices of steel and cement, the MC had to shell out nearly INR 14 crore more. Many projects of the city like the Lakkar Bridge are lying pending because fresh estimates are to be made. The cost of upcoming flyovers may also go up.

Builders have supported the bandh call given by the steel industry on February 14th 2008. Ludhiana Iron Sheet Traders Association is also supporting the bandh call given by the industrialists.

Punj Lloyd bags construction order from Marina Bay

It is reported that Punj Lloyd Group’s subsidiary Sembawang Engineers & Constructors has bagged a contract valued at SGD 400 million from Marina Bay Sands to construct the North Podium of Marina Bay Sands integrated resort comprising the casino, theatres and retail arcade in Singapore. The project commences this month and will be completed by April 2009.

The project is to build the substructure and superstructure of this mega resort which will have 4 upper levels and a 4 storey basement. Sembawang is well placed to handle this project as it is also constructing the new downtown line bay front MRT station in Marina Bay which will connect directly to the resort's meetings, incentives, conventions and exhibitions centre.

With this, Punj Lloyd total order backlog has gone up to INR 17,132 crore.

BHEL bags INR 200 crore contract from ONGC

Projects Today reported that Bharat Heavy Electricals Limited has bagged the single largest long term rate contract worth INR 200 crore from Oil & Natural Gas Corporation for the supply vital equipments for the next 3 years for their onshore as well as offshore projects.

BHEL's scope of work in the present contract envisages manufacture and supply of over 500 sets of well head assemblies, 350 sets of Xmas Tree Valves per annum and other critical spares, accessories used in oil exploration.

This is the second time BHEL has received such a contract from ONGC. BHEL had earlier received a similar long term contract from ONGC in February 2004 for well head assemblies and Xmas Tree Valves, which expired in February 2007.

HZL raises lead prices by 7.6%

Hindustan Zinc Limited announced that it has increased lead prices by 7.6% to INR 134,600 per tonne (USD 3,400) effective immediately.

Zinc prices remained unchanged at INR 108,700 a tonne.

States urge centre to allocate coal for power capacity addition

It is reported that several state governments and state electricity boards have made a strong appeal to the centre for the allocation of coal for the capacity addition of nearly 17,666 MW. As per reports, they have appealed to the power ministry that these projects be included in the center’s proposed capacity addition plan of 80,000 MW in the 11th Plan period.

However, the power ministry has made it clear that this would be possible if the promoters have started construction or they would be able to place award for plants and equipments by March 31st 2008.

According to the ministry, out of the 80,000 MW, orders have already been placed for nearly 56,000 MW. It said that "The project developers of 17,660 MW will have to place orders before March 31st 2008 then and then only they will be included in the total capacity addition of 80,000 mw during 11th Plan period."

GAIL signs MoU with Itera for petrochemical plants

It is reported that GAIL India has signed a MoU with Russian oil and gas firm Itera for setting up petrochemical plants and city gas projects in Russia even as Russia's Rosneft proposed to invest in ONGC's Mangalore gas project.

Under the MoU, the two companies will jointly set up CNG projects in Russia and explore possibilities of setting up a gas based petrochemical plant in Russia. They will also jointly invest in oil and gas exploration and production in Russia and CIS countries.

Oil & Natural Gas Corporation is keen on taking a stake in Russia's Sakhalin III and other oil and gas projects in eastern Siberia while Rosneft is considering investment in the ONGC's LNG plant in Mangalore.

ONGC Videsh has proposed to team up with Rosneft to bid for the giant Sakhalin III project in Far East Russia. OVL currently has a 20% stake in the 12 million tonnes per annum Sakhalin I project operated by Exxon Mobil. OVL is also eyeing oilfields in East Siberia, which is estimated to hold some 20 billion barrels of oil reserves. It is also looking at participating in Russian continental shelf.

RIL discovers natural gas reserves in KG basin

Reliance Industries Limited has announced that it has discovered natural gas reserves in an exploration block in the Krishna Godavari basin in India’s east coast.

The discovery, named Dhirubhai 39, was made in block KG DWN 2003/1, lying about 50 kilometers from Machilipatnam in Andhra Pradesh. Reliance Industries holds 90% interest in the block, while Hardy Exploration & Production India Inc has the balance 10%.

The well, KG V D3 A1, was drilled at a water depth of 716 meters, to a total depth of 1,937 meters, with the objective of exploring Pleistocene deep water fan complex play fairway. A thick reservoir was encountered with gross hydrocarbon column of around 84 meters in Pleistocene, the potential of which was evaluated through the wire-line based technology called modular dynamic testing.

The discovery has been notified to the government and the directorate general of hydrocarbons. The block was awarded to Reliance Industries in the 5th round of auction under the New Exploration Licensing Policy.

HPCL to shut gas oil unit at Vizag

ET reported that Hindustan Petroleum Corporation Limited will shut a hydro diesel desulphuriser this weekend at its Vizag refinery and is importing more gas oil given a 40% cut in output.

An official at HPCL said that it plans to take the desulphuriser offline at its 150,000 barrels per day Vizag refinery for 10 days but because of the shutdown, diesel production will decline. He added that gas oil output will slide to 6,000 tonnes per day or 45,000 barrels per day, from 10,000 tonnes per day or 75,000 barrels per day, during the routine maintenance.

HPCL bought 145,000 tonnes of 0.045% sulphur gas oil for March 2008, more than treble February 2008 purchases of 40,000 tonnes.

MEPS forecast another record year for global steel production in 2008

MEPS forecast that world steel production in 2008 at 1420 million tonnes. This equates to a 5.7% increase on our predicted outturn of 1343.5 million tonnes in 2007. MEPS added that over the past twelve months demand continued to be firm, with output rising by approximately 7.5%.

(In million tonnes)
Source: MEPS - World Steel Outlook

MEPS said that “Blast furnace iron making in 2008 is forecast to top 1000 million tonnes 6% up on our anticipated figure of around 946 million tonnes in 2007. This represents a gain of 8% over the 2006 outturn. A substantial rise is also foreseen for direct reduced iron manufacturing in 2008 after significant improvement in the previous twelve months.”

MEPS added that “EU 27 steel production in 2007 is now expected to be approximately 210 million tonnes. Our forecast for 2008 is marginally higher at 215 million tonnes. We envisage quite stable demand but the domestic producers should claw back some of the previous year’s consumption lost to third country suppliers. It added that steel demand in the rest of Europe expanded by almost 2.5 million tonnes in 2007. Strong demand in Turkey was the main driver for this advance.

MEPS said that “Crude steel production in the former USSR in 2007 is predicted to be significantly above 124 million tonnes up by almost 4%YoY. A further substantial improvement is forecast for 2008 rising to in excess of 130 million tonnes in the region.”

It added that “Nafta steel production in 2007 will be near to 133 million tonnes 1% up on the prior year. Further similar improvement is forecast for 2008 now that third country imports are restricted due to the weakness of the US dollar.”

Steel production in South America will be near to 48 million tonnes in 2007 up by 6% on the year earlier figure. This improvement is mainly due to rising local demand. Further growth to near 52 million tonnes is anticipated for 2008.

MEPS said that “Steel production in 2007 in Africa will be slightly up on the outturn in the previous year. A substantial improvement is anticipated for 2008 as new capacity comes on stream and furnace relines are limited. Production of steel in the Middle East is increasing briskly. Demand is accelerating at a rapid pace. Output in 2007 will be one million tonnes up on the year earlier figure. Gains of more than 2 million tonnes are forecast for 2008.”

MEPS further added that steel output in the Asian region will be above 750 million tonnes in 2007 rising to in excess of 800 million tonnes in the following twelve month period. Consumption from the construction industries is the main driver for this continued substantial improvement. Steel manufacturing will be marginally higher in Australia in 2007. Further modest improvement is forecast for 2008.

Onesteel restructuring bar mill operations

OneSteel Limited announced the restructuring of its bar mill operations to improve efficiency and focus its manufacturing efforts on securing growth within construction and resources markets. The restructuring follows an extensive six month review of OneSteel’s steelmaking, casting and rolling mill operations and is expected to provide net synergy benefits of AUD 20 million to AUD 30 million per annum. The benefits form part of the synergies from the merger with Smorgon Steel that was successfully completed in August 2007. Implementation costs are estimated at AUD 35 million exclusive of any asset write downs. These costs will be expensed in the current financial year, however the timing of the closures will mean most of the cash impact will be in 2008/09.

As a consequence, OneSteel will exit the production of approximately 50,000 tonnes of primarily engineering bar which is currently supplied to manufacturers and steel distributors. This represents approximately 4% of OneSteel’s current bar volumes and less than 1% of OneSteel’s total annual revenue. In total there will be a net reduction of approximately 180 positions within Newcastle resulting from the closure of the Newcastle Bar Mill and increases at Waratah Bar Mill. A further 90 positions will be lost at OneSteel Martin Bright.

Mr Geoff Plummer MD & CEO of OneSteel said that “The restructuring is being undertaken to ensure OneSteel is positioned for success within rapidly changing global and domestic steel markets. OneSteel currently has significant overcapacity within its bar mills reflecting long term shifts in the Australian domestic market. The restructure will enable OneSteel to focus its bar manufacturing predominantly on the growing construction and resources markets, and will eliminate around half a million tonnes of unutilized bar production capacity.”

He added that “As part of the restructuring, OneSteel will consolidate bar manufacture within its Laverton and Sydney bar mills and production will be doubled at the Waratah Bar Mill in Newcastle. The Newcastle Bar Mill and the operations of OneSteel Martin Bright in Melbourne will be closed. OneSteel will continue to produce in excess of 1 million tonnes of steel bar products across its reconfigured bar business and will manage mill loadings to improve customer service and optimize manufacturing and logistics costs. OneSteel will maintain existing overall volumes in steelmaking and rod production.”


Mr Plummer said that “The majority of OneSteel’s customers will be unaffected by this restructure. Where OneSteel is exiting the manufacture of products, we will work with customers to assist their transition to alternative sources of supply.”

Mr Plummer also paid tribute to the ongoing efforts of employees at the Newcastle Bar Mill and OneSteel Martin Bright to adjust to difficult market circumstances. He said that “This has been a difficult call for us to make in light of the obvious impact it has on our employees. The decision we have made to close these facilities needs to be seen as a factor of the changing dynamics of a now truly global industry and is in no way a judgement on the efforts of our people.”

Nucor raises April spot sheet prices by USD 60 per short ton

Platts reported that US based Nucor alerted customers that its spot order book for April 2008, flat rolled steel products opened Wednesday with at least USD 60 per short ton higher prices than March 2008. The price increase is effective with orders shipping the week ending April 5th 2008.

A letter obtained by Platts said that "Due to continued strength in order activity and strengthening market conditions, the Nucor Steel Mill Group is raising transaction prices for the month of April by a minimum of USD 60 per ton.”

Jointly signed by Nucor's Sheet Mill Group sales and marketing managers, the latest letter added that "We reserve the right to review and re quote any offers that are not confirmed with either a Nucor sales acknowledgement or written acceptance by both parties."

According to several buying sources, the USD 60 per short ton increase means that Nucor is now offering hot rolled coil at USD 730 per short ton ex works; cold rolled coil at USD 810 per short ton and base galvanized sheet at USD 820 per short ton ex works.

Unlike the March price hike letter, this one did not cite rising raw material costs as justification for the April increase.

Gerdau to invest USD 6.4 billion in 2008-10

BNamericas reported that Brazilian long steelmaking group Gerdau plans to invest USD 6.40 billion in technological upgrades and expansions over the next three years.

Gerdau in a statement said that the budget allocated for the 2008-10 period does not include possible acquisitions. Of the total investment, USD 4.40 billion will target Brazilian operations, while USD 785 million will go to the US and Canada, USD 859 million to other countries in Latin America and USD 295 million to operations in Spain. Disbursements are expected to reach USD 1.50 billion this year, USD 2.80 billion in 2009 and USD 2.10 billion the following year.

Other investment plans for the coming years that are not part of the USD 6.40 billion budget include USD 500 million targeting Gerdau's JVs in Mexico, the Dominican Republic and India.

Mr André Gerdau Johannpeter CEO of Gerdau during a conference told journalists that "I would say we are very focused at the moment on the integration of our new acquisitions. But we continue to be open and looking at alternatives because the market is dynamic and continues to reveal opportunities."

He added that as a result of the investments, Gerdau's crude steel capacity is due to expand 14% to 28.3 million tonne per year in 2010 and the group's rolled steel capacity would rise 19% to 24.8 million tonne per year.

Hot band spot prices moving towards record levels

SteelBenchmarker reported that the US hot rolled band spot price for February 11th 2008 surged by 5.7% to USD 746 per tonne, FOB the mill for the seventh consecutive rise totaling USD 169, world export HRB price rise by 4.6% to USD 725 per tonne, Chinese HRB ex works price rose by 0.9% to USD 549 per tonne and the Western European HRB surged by 8% to USD 770 per tonne ex works after slipping last time.

USA
USD 746 per metric ton FOB the mill
Up by USD 40 per ton from USD 706 two weeks ago
Up by USD 186 per ton from the recent low of USD 560 on August 13th 2007
Up by USD 116 per ton from the recent high of USD 630 on April 9th 2007

China
USD 549 per metric ton ex works
Up by USD 5 per ton from USD 544 two weeks ago
Up by USD 79 per ton from the recent low of USD 470 on October 22nd 2007
Up by USD 62 per ton from the previous high of USD 487 on September 10th 2007

Western Europe
USD 770 per metric ton ex works
Up by USD 57 per ton from USD 713 two weeks ago
Up by USD 107 per ton from the recent low of USD 663 on July 23rd 2007
Up by USD 74 per ton from the recent high of USD 696 on June 11th 2007

World Export Price
USD 725 per metric ton FOB the port of export
Up by USD 32 per ton versus USD 693 two weeks ago
Up by 175 per ton from the recent low of USD 550 on July 23rd 2007
Up by USD 129 per ton from the recent high of USD 596 on March 26th 2007

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

Japanese steel scrap export price hit record levels

JMB reported that Japanese ferrous scrap export price have made a new record.

Successful bid was averaged FAS JPY 45,550 per tonne from Tokyo bay for H2 grade for March shipment at monthly export tender held by Kanto Tetsugen on Wednesday, which was JPY 2,407 higher than previous month.

With higher export price, local electric furnace steel makers' scrap purchase price increased for the first time in 3 weeks.

Acindar net earnings fall in 2007

It is reported that Argentina's steel maker Acindar SA's 2007 net profit declined by 27% YoY despite an 11.8% sales growth due to a one time gain it booked in 2006 and higher costs.

In a filing to the Buenos Aires stock exchange, the Argentine unit of Arcelor Mittal SA said that its 2007 net profit was ARS 476.6 million (USD 150.3 million) down from ARS 603.9 million in the same period a year ago, despite an 11.8% sales growth to ARS 3.1 billion.

Acindar said that its 2006 results included a net fiscal gain of ARS 94.2 million coming from the sale of its tube unit. Its sales' average costs grew by 20.7% due to higher energy needs and higher labor and raw material costs.

The company's minority shareholders were recently bought out by parent company Arcelor Mittal, which now controls 99.5% of Acindar.

CSC wins Vietnam approval on cold roll steel JV

The Economic Daily News has quoted unnamed company officials as saying that China Steel Corp has secured approval from the Vietnamese government to establish a cold roll steel plant in Vietnam.

The news paper said that China Steel and Japan's Sumitomo Metal Industries Ltd will team up to invest a total of USD 1.15 billion in the Vietnam site. The JV is slated to begin production in 2011 with an annual capacity of 1.7 million tonnes.

Steel and Tube H1 profit down by 42% YoY

Reuters reported that New Zealand's Steel & Tube Ltd reported a 42% YoY fall in H1 net profit due to slowing markets, restructuring costs and tighter margins.

New Zealand's Steel & Tube Ltd, half owned by Australia's OneSteel Ltd made a net profit of NZD 8.6 million (USD 6.7 million) in the H1 as compared with NZD 14.8 million a year earlier.

Steel & Tube said market conditions were challenging despite strong non residential and infrastructure building in New Zealand, which has boosted demand for the company's steel roofing and pipes, wire products and metal fasteners.

Brazilian tin production revives

ITRI reported that According to the tin industry association SNIEE, Brazil’s mine production of tin in concentrates rose by 28% to 11,835 tonnes in 2007.

The growth was due to the expansion of Paranapanema’s hard rock operations at the Pitinga mine and a big increase in small scale garimpeiro production. However production by CSN’s tin mining subsidiary Ersa fell slightly.

Brazil’s refined tin production rose by 16% to 10,193 tonnes, allowing the country’s smelters to boost both domestic sales up by 23% YoY as compared to 2006 and exports up by 29% YoY.

German steel labour dispute needs resolving- Mr Wurth

Dow Jones reported that strikes at some of Germany's steel mills have not had a significant impact on ArcelorMittal's steel production but a compromise between German steel workers and steel makers needs to be reached to secure the future viability of the German steel sector.

Mr Michel Wurth member of ArcelorMittal's group management board said that nearly 2,000 eastern German steel workers from the big IG Metall union Tuesday staged warning strikes for an 8% pay raise at two steel plants, including the ArcelorMittal GmbH plant at Eisenhuettenstadt, a unit of the ArcelorMittal.

He added that "The strikes aren't affecting production too much." Nevertheless, he said the German industry has to find a way to remain competitive if we want to assure jobs and the competitiveness of the whole steel value chain.

Mr Wurth said that German steel consumption was still reasonably good and hopes the two sides will be able to arrive at a compromise.

Strikes have occurred intermittently and for short periods of time over the past several weeks.

Severoceske Doly mines may extract more coal

Czech daily Hospodarske Noviny reported that Czech coal miner Severoceske Doly, a unit of power group CEZ, is making plans to start mining coal beyond the government's ecological limits.

As per report the coal miner will be allowed to access coal beyond the limits, if it agrees with residents of areas that sit on the protected coal deposits, that it can expand coal extraction in these areas, the daily said, adding that Severoceske is already in talks with the local residents.

It added that the limits that currently stop miners from exploiting a total 1 billion tonnes of protected lignite resources in Severoceske as well as neighboring Mostecka Uhelna mines were introduced in the early 1990s to protect villages in the north of the country where the mines are situated.

The current government, which includes the Green Party, had said in its program it has no plans to lift the limits.

CEZ, central Europe's largest company has been looking for ways to improve supply conditions for its coal fired plants which make about two thirds of its total annual electricity output of about 65 TWh.

Allegiance says 3rd party drops out of takeover fight

Allegiance Mining NL said that a third party that was conducting due diligence on the nickel miner will not proceed with an rival takeover bid to that of Zinifex Ltd's AUD 775 million offer. Without naming the third party, Allegiance said that the firm was unable to comply with the timetable and deadline that Allegiance had required.

Allegiance said in a statement on Tuesday " Allegiance was advised that the relevant third party had ceased its due diligence and would not be submitting a proposal as it was unable to comply with the timetable and deadline that Allegiance had required. As a result, no third party is currently conducting due diligence or in negotiation with Allegiance.”

Allegiance also says it has called on the Takeovers Panel to make a declaration of unacceptable circumstances and final orders regarding Zinifex's 30-minute delay in advising the market that its offer had not closed on February 8th 2008. The target is concerned that some shareholders representing about 80% of its issued capital had accepted the offer at 1900 AEDT on February 8, believing it had not been extended.

Allegiance has rejected Zinifex's bid, saying it undervalues the company, specifically the exploration upside at its Avebury mine in Tasmania, which is expected to go into production this quarter.

Worldstar Energy looks to begin mining coal in South Gobi

Worldstar Energy Corp announced that it is proceeding to conclude a multi year exploration of coal sites in southern Mongolia so that it may begin extracting coal from these sites.

Bulgan Gold LLC, a wholly owned subsidiary of Worldstar Energy is to focus on finishing exploration at its 8,200 square kilometer site in the South Gobi region. Company officials said that this site is, currently in advanced exploration stages.

North American Galvanizing & Coatings reports 2007 results

North American Galvanizing & Coatings, Inc announced a record Q4 of 2007 net income of USD 2.2 million as compared to USD 1 million in Q4 of 2006. Its consolidated net earnings for 2007 were USD 9.2 million, the highest in the Company's fifty year history.

North American Galvanizing & Coatings said that its revenues for 2007 rose by 19% YoY to USD 88.4 million as compared to USD 74.1 million in 2006 due to increased sales prices in response to increases in zinc costs. Although the price of zinc and galvanizing declined in the second half of 2007, the Company's ability to capitalize on high quality, timely customer service and the generally high demand for galvanizing services have provided for steady profitability.

Volumes for 2007 were 2.8% lower than 2006 primarily as a result of the Company's review and acceptance of customer orders only at adequate margin levels, and the shutdown of the Canton plant for the scheduled replacement of the kettle and furnace during the month of July 2007.

Mr Ronald J Evans, president & CEO of North American Galvanizing & Coatings said that "The overall hot dip galvanizing market strength experienced for the first three quarters continued through year end. We continue to practice disciplined cost control and focus on margin management which resulted in a record positive cash flow for the year. We paid down all outstanding bank debt during 2007, a significant milestone for the Company."

North American Galvanizing is a leading provider of hot dip galvanizing and coatings for corrosion protection of fabricated steel products. The Company conducts its galvanizing and coating business through a network of plants located in Canton, Ohio; Denver, Hurst, Houston, Kansas City, Louisville, Nashville, St Louis and the Tulsa area. Hot dip galvanizing provides metals corrosion protection for many product applications used in commercial, construction and industrial markets.

Genco Shipping & Trading announces Q4 financial results

Dry bulk carrier Genco Shipping & Trading Ltd reported that its Q4 earnings beat market expectations, helped by a larger fleet and higher freight rates. Genco said that its Q4 earnings were USD 33.5 million, excluding a gain on sale of its ship Genco Commander, compared with USD 16.5 million in 2006. Its revenue rose by 84% to USD 65.7 million.

Genco said that Quarterly average daily time charter equivalent rate a measure of vessel hire rates rose by 52.4% YoY to USD 31,140 per day, compared with USD 20,435 a day in the year ago period. It added that the increase in the average charter equivalent rates in the fourth quarter were due to higher charter rates achieved for five Handysize vessels, four Panamax vessels and three Handymax vessels.

It further added that the increase in the average charter rates were also due to the operation of four Capesize vessels, part of the Metrostar acquisition.

Mr Robert Gerald Buchanan president of Genco said that "During 2007, Genco experienced significant success in important areas which benefited both the Company and its shareholders. First, we furthered our consolidation leadership by executing two acquisitions totaling 15 modern vessels that expanded our world-class fleet by 173% on a tonnage basis, improved the age of our fleet as well as diversified it to include Capesize vessels. Second, we advanced our commercial position by signing long term contracts during the year for 19 vessels at attractive rates as management continues to take advantage of the robust market environment. Going into 2008, we are pleased to have taken delivery of the final vessel under our agreements to acquire six drybulk vessels from affiliates of Evalend Shipping Co. SA and remain on schedule to take delivery of two Capesize vessels, one later this month and the other later this year. With the combination of having approximately 80% of our fleet's estimated available days secured on contracts for 2008 and having two vessels with profit sharing agreements, we are in a strong position to provide shareholders with a high degree of earnings visibility while maintaining the ability to benefit from future rate increases."

Genco Shipping & Trading Limited transports iron ore, coal, grain, steel products and other drybulk cargoes along worldwide shipping routes. Genco Shipping & Trading Limited currently owns a fleet of 28 drybulk vessels consisting of four Capesize, seven Panamax, three Supramax, six Handymax and eight Handysize vessels, with a carrying capacity of approximately 1,909,000 DWT

Arbitration of SA iron ore dispute yet to get under way

South African media reported that the arbitration process between steel producer ArcelorMittal South Africa and iron ore miner Kumba Iron Ore, over the right of the steel company to participate in the miner's South African expansion program has not yet formally assembled, but should reach resolution later this year.

Mr Rick Reato outgoing CEO of Arcelor Mittal South Africa said that the dispute had arisen as a result of a difference of opinion over a 2001 unbundling agreement, concluded by the then Iscor and the then Kumba Resources, which enabled the steel producer to receive 6.25 million tonnes a year of iron ore from Kumba Iron Ore on a cost plus basis.

While Mr Reato stressed that it had other options should it fail to secure an enlarge participation in Kumba Iron Ore's South African mines, he said the company remained convinced of the soundness of its case. At present, about 90% of its iron ore was procured under the cost plus arrangement, while the balance was acquired through commercial arrangements. But, given that ArcelorMittal was preparing to increase its installed capacity by some 2.5 million tonnes by 2011, that cost plus to commercially procured ratio could fall to as low as 50%.

Mr Reato indicated that a favorable outcome would be preferable to the other ‘commercial' arrangements, as it would help in ensuring that the group's cost profile remained one of the best globally, despite rising input costs. Indeed, he also noted that input cost pressures were increasing, with the Chinese iron ore spot market showing a USD 40 per tonne premium over the already strong contract prices of 2007, and coking coal and scrap prices displaying significant strength.

Iscor, which had hitherto been both a miner and a steel producer, made an upfront payment for a 21.4% stake in the Sishen resource, which helped ease Kumba's debt profile at the time of listing. It was also widely reported at the time that the steel group had also secured a right to participate in the expansion of Sishen to the extent that it could deploy that material in its South African mills. Subsequently, Anglo American assumed a majority position in Kumba Iron Ore, while the world largest steel producer ArcelorMittal, took a majority interest in South African steel company. A difference of interpretation then arose which in terms of the unbundling agreement, would have to resolved through arbitration.

Transnet to continue infrastructure development

According to Ms Maria Ramos CEO of Transnet that South African transport utility Transnet aims to use the current global economic slowdown to increase its infrastructure spending. He said that that Transnet had not yet seen a major slowdown in the sectors that the group operates in.

Ms Ramos said in an interview at the World Economic Forum in Davos that "We're looking at this as an opportunity to increase our infrastructure development. Our infrastructure program remains very much on track and we're not looking at slowing down our infrastructure spending at this stage."

She said Transnet had been affected by South Africa's electricity crisis, called a national emergency by the government recently. More effort needed to be put into saving energy. She added that hopefully in a collaborative way, we are going to have to manage a pretty tight power supply situation in South Africa until we can bring more capacity on board."

Ms Ramos said Transnet had still not met the volumes it had capacity for on its coal and iron-ore rail lines. She said there have been some difficulties in getting the volumes, but these are short-term challenges that we continue to work together with our key clients. In the end we are convinced that the volumes are going to be there.

South African power utility Eskom has been forced to cut supply to many areas across the country in the past two weeks because of its inability to meet demand for electricity from business and residents. It has warned that the cuts may continue for a further two to four weeks.

ThyssenKrupp USA names new communications director

ThyssenKrupp Steel USA LLC recently announced that it has hired a director of communications to oversee communications and government relations for the carbon steel segment of its new carbon steel and stainless steel facility being developed in Calvert.

Dinh Vu to list shares in March 2008

VNA reported that Dinh Vu Steel Co plans to list shares on the Ha Noi Securities Trading Centre in March 2008.

As per report Dinh Vu Steel Co will issue additional shares to increase its charter capital after the Lunar New Year, in which stockholders will have shares at a ratio of 1:1 at a price of VND 10,000.

The mobilized capital from the issue will be used to set up a new pig iron plant in the northern port city of Hai Phong with an investment of VND 600 billion

Qatar Steel to rebuild Jebel Ali plant in May 2008

Emirates Business reported that Qatar Steel Company will start rebuilding its AED 500 million plant at Jebel Ali in Dubai in May 2008.

Mr Mohammed Ahmed Al Sa’adi marketing director at Qatar Steel said that the new plant will produce 300,000 tonnes of steel rolls and 300,000 tonnes of reinforcement steel per annum. He added that “The increase in demand for steel in the UAE and the region has prompted it to renovate its factory at a cost equal to the purchase price.”

Mr Al Sa’adi said that steel prices in the Gulf have risen by 70% in the past 2 years due to the increase in the cost of raw materials. He added that “Steel prices in Oman are the highest in the Middle East and they are also high in Egypt. I do not expect the price of steel in particular and building materials in general to fall in the GCC, they will remain high at least for the next 10 years. Prices will increase more in the UAE and Qatar since they are seeing the highest growth rates in the real estate and contracting sectors.”

Qatar Steel bought the plant from an investment group in 2001. After it opened in 1987, Qatar Steel’s production increased from 350,000 tonnes to 1.5 million tonnes in 2007. It was the Gulf’s first integrated steel production plant and made a profit of more than AED 1 billion in 2007.

There are 14 steel factories in the Gulf, 5 in the UAE, 5 in Saudi Arabia, 2 in Oman, 1 in Qatar and 1 in Bahrain. They produce a total of about 14 million tonnes of steel, which accounts for 70% of the steel used by GCC countries. The remaining 30% is imported from Turkey, which has taken the place of China as the supplier.

L&T bags INR 311 crore contract from Qatar

It is reported that Larsen & Toubro has bagged an order valued at INR 311 crore from the Qatar General Electricity & Water Corporation for the design, supply, installation and commissioning of 5 substations.

The package consists of 66/11 kV gas insulated switchgears, 11 kV metal clad air insulated switchgears 50/60MVA 66/11 kV transformers, substation control system, protection systems DC system and auxiliaries. All 5 substations will be completed in 27 months.

Mr KV Rangaswami president & member of the board of L&T said that "KAHRAMAA is for the first time invited non OEM EPC contractors also to bid for the tender, enabling L&T to enter this market. The order has been secured against stiff competitor from many international players in the field."

China ready to join IPI gas project – Report

Business Recorder reported that China has told Pakistan its interest in importing the additional gas if India did not join in.

In case China joined the project, the pipeline might pass through the northern Pakistani city of Gilgit, where Pakistan has already approved a project to widen the Karakoram Highway. Pakistan also plans to extend a railway track to China to connect it to the Gwadar port.

Chinese experts would visit Pakistan to finalize the route of the pipeline if it joined the project.

It may be noted that Pakistan had invited India to negotiate the fee on February 7th and February 8th 2008 but India said it would talk to an elected Pakistani government after the February 18th 2008 elections.

Pakistan had earlier proposed the agreement be signed on January 25th 2007 in Abu Dhabi, but sources said Iran had told Pakistan it would only sign the agreement with an elected Pakistani government.

JC Middle East FZC plans industrial valves unit in Tamil Nadu

It is reported that JC Middle East FZC, a subsidiary of JC Fabrica de Valvulas SA of Spain, is setting up a industrial valves manufacturing facility at Mahindra World City in Maraimalainagar in Kancheepuram district of Tamil Nadu.

The facility to be spread over 5 acres of land will make valves ranging from half inch to 48 inches. The initial investment in the project will be to the tune of INR 100 crore and in the second phase, an additional INR 250 crore will be invested to make vacuum treated valves.

JCF Valves & Controls India Private Limited has already been formed to implement the project. Construction work on the project is expected to commence by June 2008 and the unit is expected to go on stream by 2009 end.

UAE Qatar causeway to cost USD 13 billion – Report

MEED reported that a proposed causeway linking Abu Dhabi with Doha in Qatar may cost about USD 13 billion.

As per report, Denmark based engineering company COWI is likely to be involved in the project as a consultant. It is already involved in a project to build a causeway between Qatar and Bahrain.

Mr Mohammad Ali regional adviser with COWI said that the latest design envisages linking the two cities via a 65 kilometer bridge across the Gulf.

The original design for the UAE Qatar causeway, which was first developed 6 years ago, was for a 40 kilometer link. This was changed due to difficulties with the route, which ran through Saudi Arabian territorial waters.

No date has been set for construction to start.

Saudi energy investments to reach USD 119 billion – Report

According to a report “Saudi Arabian Paradox: Opportunities & Challenges in the KSA Energy Infrastructure Market 2008”, launched by Contax Group, Saudi Arabia's energy infrastructure investments are expected to top USD 119 billion during 2007-2009.

The report added that the massive investment will provide considerable opportunities for all players involved in financing, delivering or supporting these projects.

Mr Khalid Irshad consultant at Contax said that “The biggest growth opportunities will be for refining and petrochemical projects, reflecting Saudi Arabia’s desire to diversify from a strong dependence on pure crude exports.”

Mr Paul Eccleston CEO of Contax said that “Acquiring, retaining and training staff remains a key issue for Saudi Arabia and the GCC region. Saudi Arabia faces challenges to attract an experienced workforce because the attractiveness of other countries continues to draw talent away from the kingdom.”

He said that the study is based on in-depth interviews with business leaders at leading national and international organizations, including oil companies, financiers and contractors.

The study reveals that investments in these segments during 2007-2009 are worth USD 48 billion, while investments in the refining sector will grow by a staggering 2189% during 2007-2009 compared to 2004-2006. It also highlights significant challenges in the marketplace, most notably resource availability and talent scarcity.

Ducab set to invest AED 125 million in copper rod facility

It is reported that Ducab, a power cables manufacturer equally owned by the governments of Dubai and Abu Dhabi, is investing AED 125 million to commission a copper rod factory in the UAE capital as part of its expansion activity.

Mr Andrew Shaw MD of Ducab said that the factory is owned by the German manufacturer Contirod and would be the first copper rod making facility in the UAE. He added that the factory would start operating in June 2008 with an annual capacity of 120,000 tonnes of copper cable per year.

Ducab currently has a 35% market share of the low and medium voltage cable in the UAE. It would hit its target of 50% growth for 2007 or AED 2.2 billion from AED 1.6 billion recorded the previous year, due to increased domestic sales and exports to Saudi Arabia.

Karachi Port handles record coal in one day

Business Recorder reported that Karachi Port Trust has set another record handling of coal cargo by offloading 25,600 tonnes within a span of 24 hours through MV Annita on February 12th 2008.

Previously KPT handled 21,446 tonnes of cargo on August 24th 2006 and the national entity has set new standards for coal handling.

This high productivity targets in cargo handling is the outcome of efficient environment at the port and good relations with port users.

Pakistan welcomes Chinese participation in IPI pipeline

It is reported that Pakistan would welcome Chinese participation in the IPI gas pipeline project.

Mr Muhammad Sadiq spokesman of foreign office said that Pakistan is committed to the project because of its rising energy needs. He added that Pakistan welcomes prospects of Chinese inclusion in the project with or without India.

Mr Sadiq said that Pakistan would be hosting third Regional Economic Conference on Afghanistan in Islamabad on March 26th and March 27th 2008. A business conference will also be organized jointly by board of investment and Federation of Pakistan Chambers of Commerce & Industry in association with Afghanistan Investment Support Agency.

The Islamabad conference is likely to be attended by more than 300 participants from 20 regional countries, G 8 states and international and regional organizations like World Bank, UN, Asian Development Bank, ECO and SCO.

GCC oil and gas export to top USD 450 billion – Report

According to report, entitled “GCC Economic Outlook for 2008” by Dr Mr Ala'a Al Yousuf chief economist at Gulf Finance House, GCC wide oil and gas export receipts are forecasted to top USD 450 billion this year, averaging to USD 12,000 on a per capita basis.

The external current account surplus is also forecasted to hover around USD 200 billion and the fiscal surplus to be in the range USD 150 billion to USD 170 billion. These surpluses are expected to boost government expenditure smoothing capabilities over the medium term and finance the spree of cross border acquisitions by sovereign wealth funds.

Mr Yousuf said that "Our outlook for the GCC economy continues to be very positive but the increased risks to the global economy mean that policy makers in the GCC have to remain vigilant, especially in the conduct of monetary policy." He added that US faces a prolonged period of lower growth rate than its potential as the macroeconomic imbalances and financial conditions gradually adjust towards sustainable levels.

As per the report, the key risk to the GCC in 2008 is the spillover of slower growth in the US to global demand for crude oil and hence crude oil prices. Despite this, oil prices are expected to drift lower towards USD 75 per barrel by midyear, as increased supply catches up with weakening demand and the dollar stabilizes, but then will pick up again in the second half of the year.

The second key risk to the GCC highlighted in the report is stubbornly high inflation, given the very limited scope for the use of monetary policy. Inflationary pressures, however, are expected to moderate this year.

GCC states have already slashed policy interest rates in response to the sudden Fed rate cuts on January 22nd and January 31st 2008 and more cuts are expected to follow. Accordingly, GCC governments are most likely to step up the use of sterilization operations via issuing central bank bonds as well as direct credit or price controls, such as caps on loan-to-deposit ratios, higher reserve requirements, subsidies, and caps on rental increases.

The report further added that inflation rates will likely hover above the five percent mark across most GCC states and will be mostly driven by hikes in housing rents and food prices. Real estate prices will stay firm as delays in project delivery, rise in construction costs, rapid inflow of expatriates and growth in mortgage finance accentuate supply demand imbalances.

Israeli firms plan realty projects in India

Israeli firms Property & Building Corporation Limited and Electra Real Estate Limited business conglomerates have announced their plans to build USD 10 billion real estate projects in India’s three southern cities of Hyderabad, Chennai and Mysore through a newly incorporated Indian JV company called PBEL Property Development (India) Private Limited.

Property & Building Corporation is a subsidiary of the IDB group, whose business interests range from telecom to real estate, while Electra Real Estate is a subsidiary of Elco Holdings of Israel. Both these companies hold 90% of the equity in PBEL in equal ratio while, Hyderabad based Incor Infrastructure holds a 10% stake in the JV

Mr Meir Boukris director and founder of PBEL said that it had already invested USD 125 million in acquiring 110 acres for building 4 projects, 2 in Hyderabad and 1 each in Chennai and Mysore. He added that PBEL Property would invest another USD 10 billion in various projects in the next 2 to 3 years in India.

On the fund raising exercise for the company's phase I plans, Mr Boukris said that it would be decided during the course of working on each of these projects, which would be completed during 2008.

South Korea to develop oil fields in Kurdistan

Yonhap reported that South Korean energy developers are moving to secure development rights to four oil fields in northern Iraq that may hold enough crude to supply the country for up to two years.

The deal that is to be signed later in the day between a local consortium led by state run Korea National Oil Corp and visiting officials from Iraq's autonomous region of Kurdistan could allow local energy companies to gain access to 1 to 2 billion barrels of untapped crude oil.

The MoU calls for the consortium to develop oil while helping build up basic infrastructure that can ensure continued growth of the largely underdeveloped region. A Korea National Oil Corp official said "Details of how oil will be divided between South Korean companies and the local government will be decided at a later date.”

Oman and India plan one more fertilizer project

Mr Anil Wadhwa Indian Ambassador to Oman said that the two countries are planning to build another fertilizer project with a capital expenditure of USD 1 billion to produce urea in Oman. He added that “India and Oman have agreed to build another fertilizer project. In terms of capacity, it will be similar to the existing JV.”

Mr Wadhwa added that “The capital expenditure of the proposed project is envisaged at USD 1 billion. The Indian government has agreed to invest in the project. The location will depend on the availability of gas. It could be an extension of the existing fertilizer project in Sur or could be in some other area.”

It may be noted that Oman and India have set up a USD 968 million JV called Oman Indian Fertilizer Company to produce ammonia and urea at Qalhat in Sur, which started production in March 2005. Omifco produces 1.652 million tonnes of granulated urea and 0.248 million tonnes of surplus ammonia per annum using natural gas as feedstock. India has a 100 per cent buy back agreement with the company.

HUBCO H1 net profit up by 7.2% YoY

Pakistan's Hub Power Corporation Limited has posted net profit of PKR 1.34 billion in July to December 2007 period up by 7.2% YoY as against 1.25 billion PKR in July to December 2006 period. Sales have recorded at PKR 26.79 billion up by 35.7% YoY as against PKR 19.73 billion.

Mr Mohammad Saqib Sajjad an analyst at Invisor Securities Limited said that "This exceeded market expectations with the net profit and dividend."

Britain's International Power Plc owns 16.6% of HUBCO, which runs a 1,292 MW thermal power plant near Karachi.

ACWA acquires 40% stake in Emaar’s Multiforms

ArabianBusiness.com reported that Saudi Arabian Company for Water & Power Development has acquired a 40% stake in Multiforms an architectural façade specialist and subsidiary of Emaar Industries & Investments.

ACWA Power specializes in infrastructure projects development including water and energy application systems and wastewater management systems.

Chinese steel prices expected to increase in late February 2008

MySteel reported that on the backdrop of steelmakers across the world lifting prices of steel products to recoup escalating raw materials costs, Chinese steel price rally is expected to come at the end of February 2008.

A senior steel analyst in Shanghai said that "Chinese steel prices are set to rise around the end of this month, since it takes time for domestic steel market to start up to full extent after the Lunar New Year Holiday. Domestic steel prices would inch upward slightly in recent days bolstered by positive market sentiment.”

Mr Wang Jianhua vice director of MRI said that “Steel sales used to be sluggish in February 2008 is due to the festivals. However, the fundamental market supply and demand has been disrupted as a host of steel mills have been forced to slash or suspend production as a result of tight supply of coking coal. Moreover, depleted steel inventory held by down stream users would also lend support to steel price rally in days to come.”

Canada decides AD margins for seamless tubes from China

Canada Border Services Agency has made final determinations of dumping and subsidizing pursuant to paragraph 41(1)(a) of the Special Import Measures Act with respect to certain seamless carbon or alloy steel oil and gas well casing originating in or exported from the People’s Republic of China on February 7th 2008.

The product under review is seamless carbon or alloy steel oil and gas well casing, whether plain end, beveled, threaded or threaded and coupled, heat treated or non heat treated, meeting American Petroleum Institute specification 5CT, with an outside diameter not exceeding 11.75 inches (298.5 mm), in all grades, including proprietary grades.

The margins of dumping and amount of subsidy decided are as under

WAMD - Weighted Average Margin of Dumping (As a % of export price)
WAMS % - Weighted Average Margin of Subsidy (As a % of export price)
PMT - Amount of Subsidy in CNY per tonne

The Canadian International Trade Tribunal is continuing its inquiry into the question of injury to the domestic industry and will make an order or finding by March 10th 2008. Provisional duties will continue to apply until this date

Chinese domestic HR price jumps up after festival

It is reported that HR prices have seen remarkable rise in China after people come back from seven day Spring Festival holiday and that the advance is expected to spread into the next month considering the short supply and seasonal demand increase

As per reports, on Shanghai market, commodity grade 4.5mm to 11.5mm HRC in 1500mm width by Shagang is now being offered at CNY 4780 per tonne to CNY 4820 per tonne and in 1800mm width at CNY 4980 per tonne to CNY 5000 per tonne as compares with CNY 4650 per tonne and CNY 4870 per tonne respectively at the end of January 2008.

This means that price have surged by about CNY 130 per tonne to CNY 170 per tonne or USD 18 per tonne to USD 25 per tonne

As per report, export market is quiet and it is expected to resume in next week. It is until next week can they know how steel mills set new offers and the reactions from overseas buyers Export offers by most steel producers are prevailing at USD 720 per tonne to USD 730 per tonne on FOB basis, which is anticipated to rise further in next week.

China suffers first defeat at WTO in auto parts case

It is reported that China has suffered its first defeat at the World Trade Organization in a case centered on restrictions on the importation of car parts. Upholding a complaint from the European Union, Canada and US, the preliminary WTO finding agrees that the current Chinese practice is protectionist. WTO has issued its first condemnation of Chinese commercial practices, siding with US, EU and Canada in a dispute over car parts.

The panel found that Chinese measures accord imported auto parts less favorable treatment than like domestic auto parts or subject imported auto parts to an internal charge in excess of that applied to like domestic auto parts. Its final message to Beijing was that “The dispute settlement body requests China to bring these inconsistent measures as listed above into conformity with its obligations”.

China has a minimum local content requirement for locally made cars and imposes tariffs if the value of the foreign parts content exceeds this threshold. The plaintiffs argued that this measure violates China's WTO accession agreement which pledged a progressive opening up of its markets.

The case is the first time China has been the subject of a complaint at the WTO's Dispute Settlement Body since joining the organization in 2001.

China to announce coal export quotas in March

Reuters reported that world's top coal producer and consumer China is likely to issue 2008 coal export quotas after March, despite current shortages in some parts of the country triggered by freak winter weather.

The report cited some industry officials and traders as saying that Beijing is unlikely to suspend coal exports altogether this year, though it might reduce the quota volume to 58 million tonnes.

An official said “Currently, supply and demand are in balance. The problem is transportation. You should not use temporary coal prices and transport problems to forecast the coal industry. The government will carry out quotas this year.”

China exported 53.17 million tonnes of coal in 2007.

In the past, the government has issued quotas before the Lunar New Year holiday as those from the previous year expire in February. It did not do so this year, prompting speculation that China might stop exports of the fuel altogether.

Chinese domestic CR prices firm up after holiday

It is reported that Chinese market price of carbon steel cold rolled sheets and coils increased in Shanghai on February 14th 200.

As per reports, the price of cold rolled sheets with thickness 1.2mm and 2.0mm from Ansteel is currently at between CNY 5,830 per tonne and CNY 5,850 per tonne up by CNY 50 per tonne to CNY 70 per tonne (USD 7 per tonne to USD 10 per tonne)

It is also reported that prices for other thickness, like 1.0mm, it is prevailing at CNY 5,880 per tonne.

Chinese delegation visits plants of HEC in India

Ranchi Express reported that a three member team from China Shogun International Trade & Engineering has visited the Heavy Engineering Corporation Limited plant at Ranchi in Jharkhand state of India to take stock of the available expertise and facilities.

As per report, the team led by Mr Xiang Hua visited Heavy Machine Building Plant and Heavy machine Tool Plant. They also called Mr GK Pillai CMD of Heavy Engineering Corporation and others officials who apprised them of the facilities.

The China Shogun International Trade & Engineering expressed its interest in technological know how transfer with the Heavy Engineering and business development between the two companies. It appreciated the low cost designs of Heavy Engineering and wanted to know how the public sector enterprise could assist it in its venture.

China unlikely to freeze coal price

According to an official from China Coal Trade & Development Association, China is unlikely to freeze coal price.

The official from China Coal Trade & Development Association said that National Development and Reform Commission once released an interim price intervention policy in early January to fight inflation, but it was not for coal only.

Though coal price rose owing to scant supply in January, it has clamed down. Supply price during China's Lunar New Year was in line with long term contract price.

WISCO produces 1.04 million tonnes of auto steel in 2007

According to statistics offered by WISCO manager office in 2007, WISCO produced a total of 1.04 million tonnes steel sheet that's applied in salon cars, more than tripled than in 2006 and fulfilling the company's 1 million tonnes target.

Under the 10th five year plan, WISCO put development of saloon car steel sheet as one of the keynote projects and brought forward the 1mt target for 2007.

In 2007 WISCO obtained recognition from Chery, Shenlong, Volkswagen and Dongfeng etc and its consumer clients increased substantially with cumulative forward contracts topping 1 million tonnes.

Export Import Bank of China inks pact with Shagang

It is reported that the Export Import Bank of China signed cooperation agreement with Jiangsu Shagang Group on February 3rd 2008.

As per report, the Export Import Bank of China has decides to provide a loan of CNY2 billion in the import of resources by Shagang.

It may be noted that along with the expansion of scale of Shagang Group and the increase of capacity, capital flow needed by Shagang has gone up.

Masteel secures financing from Export Import Bank of China

It is reported that recently, Masteel and Export Import Bank of China signed a strategic cooperation agreement which is about financing CNY 6 billion in three years.

Through the implementation of the cooperation agreement, Maanshan Steel can get a large scale low interest loans to help reduce costs, continue to expand the scale of import and export in the state of the industry's tight macro economic policy environment.

Masteel’ import and export amount reached USD 2.05 billion in 2007, export amount was USD 0.63 billion up by 48%YoY, imported iron ore 14.52 million tonnes an increase of 27.3%.

In addition, Masteel secured financing of CNY 1.3 billion from Export Import Bank of China in 2007.

Laiwu steel increase EXW price for H-beam

It is reported that Laiwu Steel increase EXW prices for H-beam products. Price is raised by CNY 120 per tonne for large scale H beam and CNY 150 per tonne for small scale H-beam.

Price for US standard and EU standard H-beam is hiked by CNY 200 per tonne.

China likely to faces scrap shortage in 2008

It is reported that China's scrap resources fell into short supply and stocks dropped to the bottom line for several times in 2007, as steel capacity was released continuously. Experts have forecasted China will demand 84.8 million tonnes of scrap in 2008 up by 8 million tonnes as compared to 2007 with a resources shortage of over 10 million tonnes.

Unbalanced supply and demand relationship, high steelmaking pig iron price, decreased steel exports and some other factors are expected to influence the scrap market in 2007.

As for scrap, resource supply is the only dominant factor affecting market price. As prices for coke and iron ore kept rising in whole 2007, EXW price for steelmaking pig iron lingered at CNY 4000 per tonne at last year end up by CNY 1500 per tonne from that in the year beginning. However, the price hike failed to bring enough profit margins. On the contrary, price increments of coke and iron ore beat that of pig iron, hence some iron makers have suspended productions. Besides, the tightened control on energy saving and emission reduction further pushed steelmakers to cheap scrap. The price gap between the two is unlikely to narrow in the coming days and the shortage of scrap may succeed 10 million tonnes. Scrap will be a substitute of steelmaking pig iron in the whole 2008.
On the other hand, China started to tighten control on coal mines due to nasty accidents in recent years, decreasing coking coal supply and driving up coke price. Besides, despite dull iron ore transactions in the year end, traders take an optimistic view of the market as they believe iron ore benchmark price will rise inevitably. Against such a backdrop, steelmaking pig iron price maintained highest at CNY 4000 per tonne in the year end. Given price gap of some CNY 450 per tonne, firm steelmaking pig iron price will buoy up scrap price in this year.

In the meanwhile China's steel exports are unlikely to increase notably in 2008, in view of the new export tariffs. Steel market both at home and abroad may decline rationally. But providing international price keep rising owing to China's decreasing exports, alluring profits may pull up export volume. Market demand in both home and overseas markets will lead to scant supply of scrap.

In view of increasing costs of scrap and pig iron, some steelmakers plan to use sponge iron as a substitute. But merely a few steelmakers take this move as it is difficult to transport and stock the material.

Severstal acquires 100% of Celtic Resources Holdings PLC

Severstal announced that it’s a wholly owned subsidiary Centroferve has completed the acquisition of gold miner Celtic Resources Holdings plc.

As on January 30th 2008, when its Offer for Celtic closed and upon completion of the compulsory acquisition procedure Centroferve had acquired 100% of the issued share capital of Celtic. Celtic’s shares were delisted from AIM on January 22nd 2008.

The revised offer of Severstal of 290 pence per share valued Celtic at 173 million pounds. As a result of earlier acquisitions of Celtic shares at lower price levels, the total acquisition price paid by Severstal was 162 million pounds.

Severstal Resurs, which manages all Severstal’s mining assets, is the second largest producer of pellets and coking coal in Russia. The scrap business of Severstal Resurs consists of number of scrap metal yards in the Northwestern, Central and Southern parts of Russia. Severstal Resurs assets in the gold sector include two gold mining companies OOO Neryungiri Metallic located at Sakha in Yakutia and ZAO Rudnik Aprilkovo located in Chita region and licenses for geological survey and gold mining at the following fields Vitikamsky and Sagan Golsky located in Buryatia region and Uryakhsky ore field located in Irkutsk region. It also now includes two Celtic’s gold mines Suzdal and Zherek and controls Shorskoye molybdenum mine in eastern Kazakhstan.

NTMK develops X70 and X 80 grades

FIS reported that Evraz Groups’ Nizhniy Tagil Metal Integrated Works has developed the production of API X 70 and API X 80 in conformity with highest requirements to chemical composition. High resistance to wear and structure purity has been confirmed by multi step control of metal samples.

As per report, all the samples underwent many stages of testing, so when the experts from the plant’s central lab looked at them using the high precision binocular optical microscope supplied by Leica, the content of non-metallic impurities was truly very low. In addition, the purity of X70 and X80 steels was confirmed by an independent testing center in the Czech Republic.

X70 and X80 steels are particularly suitable for high pressure pipelines thanks to their great durability and fineness. These grades are intended for production of large size pipes, which are used in the construction of high pressure trunk pipelines.

MMK Intercourse and Magnetto to form auto blank JV

FIS reported that Italian producer of car blanks Magnetto Automotive is set to establish a JV with Intercourse-IV, a subsidiary of MMK.

As per report, JV will set up an auto blanks plant in Saint Petersburg and the JV agreement will be signed sometimes in April 2008.

The company has already selected a land plot in Kolpino for the plant's construction. The plant's construction costs are estimated at RUB 3 billion. The first phase of the capacity of 125,000 tonnes is to be put into operation in 2010.

In 2007, MMK bought 75% of Intercourse, the supplier of blanks and components for Ford, Volkswagen and Electrolux.

ArcelorMittal Temirtau to increase output by 13% YoY in 2008

Reuters reported that ArcelorMittal plans to increase crude steel output at its Kazakh subsidiary by 13% to 4.610 million tonnes in 2008.

The report said ArcelorMittal Temirtau plans to boost rolled steel output to 4.050 million tonnes from last year's 3.581 million tonnes and increase coal production to 12.850 million tonnes from 12.202 million.

ArcelorMittal Temirtau, Kazakhstan's sole steel mill exports about 90% of its output, mostly to Russia, Iran and China.

Ruukki provides steel framework to elevate ski slope in Russia

Rautaruukki has delivered the steel framework for a project to elevate a ski slope in the village of Kvan, near Kaluga, some 190 kilometer southwest of Moscow.

Ruukki’s delivery included design and construction of a 108 meter long and 45.7 meter wide artificial slope that will merge smoothly into natural slope downstream. The artificial elevation will be 20 meters high and there are plans to build a restaurant, hotel and some office buildings underneath the construction.

The structure of this facility was designed, manufactured and delivered by Ruukki Construction’s Obninsk unit in Russia. Ruukki’s part of the work lasted three months and construction of the Kvan alpine skiing centre is expected to be completed in February 2008.

Mr M. Sargsyan GD of the project owner CJSC Kaluga Glavsbitstroi said “We have been working together with Ruukki for a long time already and we’ve always been satisfied with their quality and lead times. Ruukki’s individual approach to each project and maximum attention to our requests makes it a good partner.”

Mr Sergey Chernyshev sales director of Ruukki Construction for Eastern Europe said “Although we have a lot of experience in the construction of various sports facilities, this was the first time we had done anything like this. In the next few months, alpine skiing enthusiasts will be able to judge the true value of the new complex.”

Mechel’s Ural Stampings completes LUZ quality system audit

Mechel OAO has announced that specialists from the independent auditor group, LUZ, a scientific railway research institute located in Prague, completed its quality system audit of the Urals Stampings Plant OAO subsidiary for manufacturing railway axles to the European market.

The released said that the experts from LUZ carried out a full scale audit of the plant and they unanimously confirmed that the equipment for manufacturing railway axles is in compliance with its high standards. Additionally, the auditors confirmed all of the documentation with the TSI-H1 standard, that the production technological processes, such as forging, cooling and heating and thermal processing as well as control and testing, storage, packing and shipping met their requirements and are now in compliance with the EN 13261 standard.

Since 1995, the Urals Stampings Plant OAO has produced railway axles, and these products have received several international certificates demonstrating their high quality. Furthermore, the plant's management system is in compliance with the ISO 9001:2000 international standard, which is a universal indicator of a manufacture's market position.

The production of railway locomotives axles, which are partially exported to the North American market, has been certified by the Association of American Railroads and is in compliance with the M 101 standard.

The manufacturing of rolling stock rough axles has been approved by the Register of Certification on the Federal Railway Transport to meet the requirements of GOST 30272 and GOST 30552.

Bashneft oil production to decline in 2008

FIS reported that Bashneft OJSC projects oil production is likely to be reduced by 0.8% YoY in 2008 to 11.501 million tonnes.

In order to cut down production costs and increase competitiveness of local oil Bashneft in 2008 will use the most advanced well drilling technologies and methods increasing oil recovery. Bashneft is developing over 160 deposits, most of which are in the final stage of development.

In 2007, Bashneft produced 11.6 million tonnes of oil and 341 million cubic meter of gas.

Russia has no plans to monopolize Ukrainian gas system

RIA Novosti cited Mr Vladimir Putin president of Russia as saying that Russia has no plans to monopolize Ukraine's natural gas transportation system.

Mr Putin said Russia only wanted the system to function normally, adding that Russia and Ukraine had agreed to set up an international gas consortium with the participation of European partners to attract funds to maintain the system and ensure its development. He said the Ukrainian gas transportation system would remain under Ukraine's ownership.

Mr Putin said it is natural for Russia to seek market prices for gas supplies to other countries. He said "I am pleased to say that the Ukrainian leadership, first of all, the president, understands this well."

Mr Oleksandr Turchinov first deputy premier of Ukraine said earlier that the gas price for Ukraine this year would remain at the 2007 level of USD 179 per 1,000 cubic meters and that Ukraine would not raise its transit fee, which stands at USD 1.79 per 1,000 cubic meters per 100 kilometer.

Russia and Ukraine reached an agreement recently to avoid a reduction in natural gas supplies threatened by Gazprom if Kiev failed to pay off its USD 1.5 billion gas debt. Ukraine agreed to start paying the debt recently and Russia agreed to remove intermediary traders.