Foundation stone laid for SAIL funded Damodar Bridge

Mr Ram Vilas Paswan union minister for fertilizers & chemicals and steel laid the foundation stone of a new road bridge over the river Damodar that will connect Burnpur in Burdwan district and Madhukonda in Purulia district of West Bengal.

The construction of the bridge is being funded by Steel Authority of India Limited under its Corporate Social Responsibility program. The estimated cost of construction is about INR 50 crore.

The proposed 720 meter long all weather road bridge will provide better connectivity for the entire area under the Asansol Durgapur Development Authority, in which SAIL's IISCO Steel Plant is located, with Ranchi, the capital of neighboring state Jharkhand. The bridge will also pave the way for major socio-economic development of the area.

Addressing the gathering on the occasion, Mr Paswan assured that ISP would keep its modernization & expansion deadline of 2010. The recently revived Kulti Steel Works is likewise likely to commence production by August this year. The Minister said that the revival of ISP and Kulti Steel Works would be the harbingers of development for West Bengal. It may be mentioned that SAIL is investing over INR 20,000 crore for modernization and expansion of its units in West Bengal. Describing IISCO Steel Plant and Kulti Steel Works as "national heritage", Mr Paswan requested the West Bengal government to extend sales tax waiver for ISP beyond March 31st 2008 since the plant was yet to regain its net worth.

Members of Parliament Mr Basudev Acharia and Mr Bangsagopal Choudhury, SAIL Director (Personnel) Mr Ganatantra Ojha and ISP Managing Director Mr SP Rao were among the dignitaries present at the foundation stone laying ceremony at Burnpur Stadium

Indian steel sector growth in January dips to 5.5%

According to the latest figures from Indian government, India’s steel sector has witness a dip in growth rate to 5.5% in January 2008 as against 8.5% in January 2007. For the period of April to January 2008, the growth has been reported at 5.1% as against 11.1% in April to January 2007.

Month wise data is as under

In ‘000 tonnes
Source – Ministry of steel

1. Cumulative total may not tally with monthly total
2. Production data and Growth rates are provisional.

Mr Paswan asks Orissa to expedite steel projects

Criticizing the MoU signing spree of the Orissa Government, Mr Ram Vilas Paswan union steel minister said that it has pledged iron ore beyond its deposit to private companies. Mr Paswan said that "There is no meaning of signing MoUs unless they are implemented within a specific timeframe."

Mr Paswan asked the state government to expedite implementation of the MoUs and said that it should also make a realistic assessment of its iron ore reserves.

He predicted acute shortage of steel in 2020 as the government target is to produce only 220 million tonnes against a projected demand of 300 million tonne. Therefore, there will be a huge gap between the demand and supply. Mr Paswan said that if the Orissa government did not expedite its MoUs, India may not meet the target of producing 124 million tonne of steel by 2011-12.

AP CM seeks intervention from PM on cement & steel prices

It is reported that Dr YS Rajasekhara Reddy chief minister of Andhra Pradesh has written a letter to Dr Manmohan Singh, seeking his intervention in checking the unprecedented rise in price of cement and steel.

Dr Reddy wrote that "The unprecedented increase in the prices of cement and steel is severely affecting the construction and infrastructure sectors. Andhra Pradesh has embarked upon the ambitious programs of housing, providing shelter to the common man and Jalyagnam, irrigation projects for the benefit of framers and to provide food security and several industrial and infrastructure projects. The state is the largest consumer of cement and steel as of now."

Dr Reddy said that in the case of structural steel, prices are up by more than 25% between April 2007 and March 2008. The price of cement has gone up to INR 230 a bag from INR 160 and steel prices have touched INR 50,000 a tonne up from INR 28,500 in past 6 months. He added that "This has been seriously jeopardising the targets set by the state government and dislocating the work schedules."

He observed that the cement and steel producing industrialists are resorting to exorbitant revisions in the prices and these increases are indiscriminate with reference to their production costs. Citing these extraordinary circumstances, Dr Reddy wanted the prime minister to intervene and direct suitable corrective measures.

CIL subsidiaries to enter into fuel supply pacts with users

BL reported that Coal India Limited will enter into fuel supply agreements with its customers latest by April 30th 2008. The report cited a senior CIL official as saying that "Our coal producing subsidiaries will issue notices to customers within this week for entering into supply agreements latest by April 30th 2008." He added that consumers entering into firm agreements would be receiving supplies at notified prices beginning of May 2008.

Introduced by the new coal distribution policy, the supply pacts will do away with the existing linkages and introduce a firm take or pay system, whereby customers will have to pay for non lifting of the allocated quantities at notified prices. CIL will also be equally responsible for supply of agreed quality and quantity of coal.

As per the new policy, all coal consumers except those in the small and medium sector consuming up to 4,200 tonnes a year, will have to enter into separate fuel supply agreements. Supplies to small and medium sector will be made through a state nominated agency and the latter will have to enter into a supply pact with CIL. Power and fertilizer are eligible to get normative supplies for the entire quantity required. Other consumers will get 75% normative supply. All the existing linkages, which do not make it mandatory for the customer to lift the quantity offered, will be replaced by firm allocations and the corresponding fuel supply agreements.

The CIL subsidiaries, which will introduce the few supply agreements, are Eastern Coalfields Limited, Bharat Coking Coal Limited, Central Coalfields Limited, South Eastern Coalfields Limited, Mahanadi Coalfields Limited, Northern Coalfields Limited and Western Coalfields Limited.

Mr Paswan asks PM to withdraw DEPB on steel exports

PTI reported that Mr Ram Vilas Paswan union steel minister has asked Dr Manmohan Singh prime minister to withdraw export incentives available to steel producers, who have been raising prices despite repeated appeals by the government.

Moody raises TATA Steel rating outlook to stable

Global rating agency Moody's Investors Service announced that it has raised the outlook on the speculative grade rating of TATA Steel to 'stable' from 'negative', after it repaid USD 3.1 billion of bridge loans, used to fund the buyout of Corus. Moody has also affirmed the 'Ba1' speculative grade corporate family rating to TATA Steel.

Mr Terry Fanous senior VP of Moody said "The change in outlook to stable reflects the completion of debt refinancing associated with the Corus acquisition, thereby removing a material near term challenge for the rating.”

According to Moody's, the stable outlook is based on its expectation that Corus integration would continue to be manageable and that steel prices in both Asia and Europe would remain relatively robust for the coming 12 months to 18 months.

The outlook was previously revised to negative in September 2007 due to concerns surrounding the USD 3.1 billion of bridge loans, which have been repaid principally from equity rights issuance and the establishment of long term debt.

Moody noted that the rating might experience an upward trend if the company demonstrates continued progress in integrating Corus and manages its capital and capacity expansion in a prudent manner. On the other hand, the rating could also be downgraded if TATA Steel faces delays or cost over runs in executions of its expansion projects.

Indian core sector growth in January dips to 4.2%

The Index of Six core infrastructure industries having a combined weight of 26.7% in the Index of Industrial Production with base 1993-94 stood at 247.6 (provisional) in January 2008 and registered a growth of 4.2% (provisional) compared to a growth of 8.3 % in January 2007.

During April-January 2007-08, six core-infrastructure industries registered a growth of 5.5% (provisional) as against 8.9% during the corresponding period of the previous year.

Source of data: Concerned Ministries/Departments/Organization(s)

World Bank approves USD 600 million loan for PGCIL

It is reported that World Bank has approved a USD 600 million loan for Power Grid Corporation of India Limited to increase reliable power between states and regions.

The World Bank, in a statement, said that "The fourth power system development project aims to reduce transmission losses and cut the cost of energy through further investments in transmission systems. It will also contribute to the clean energy initiative through both the ability to transfer surplus hydro energy to power deficit regions in India and relieve some of the pressure to build generation facilities, particularly in and around the major load growth centers."

Ms Isabel Guerrero World Bank country director for India said that "India's policy reforms in the power sector are beginning to pay off. This project, by strengthening transmission networks within and between regions, will enable more power to reach the people across India."

PGCIL operates most of India's inter state transmission assets. Despite a booming economy, India's growth potential is constrained by lack of electricity services and limited power generation. Over 40% of the population is without electricity, while companies have to rely on back up generators to ensure reliable supply.

AP tribals protest against bauxite mining

SNS reported that tension prevailed on the premises of the Visakhapatnam District Collector’s office, when Girijans held a demonstration against the proposal of the state government to take up bauxite mining in the Eastern Ghats through the AP Mineral Development Corporation.

The demonstrators raised slogans against the government for its decision to go ahead with mining, in spite of the opposition expressed by the public in the area, the various Opposition parties and voluntary organizations. They said that "It will spell ruin to the Girijans in the hills and the people in the plains as well, as water sources will be polluted. Tribal habitats will be ruined."

The protestors were allowed to meet the district collector, Mr Sanjay Kumar and present a memorandum voicing their grievances. The collector promised them that he would take note of it and take the matter to the State Government.

As per report, AP Mineral Development Corporation will provide bauxite to the Jindal group setting up an alumina refinery in the Vizianagaram district and the Ras Al Khaima setting up another refinery at Makavarapalem in Visakhapatnam district.

Ramsarup Industries commences LRPC Phase 1

Ramsarup Industries Ltd announced that production of Low relation Pre stressed Concrete Strand Wire under 1st phase has been commenced.

The release added that the production of 2nd LRPC Plant (Single line) is expected to commence by September, 2008 whose progress is in full swing.

Plating and patenting plant of specialty wire order has also been placed which is expected to be complete by February, 2009.

Indian coal sector growth in January dips to 4.8%

According to the latest figures from Indian government, India’s coal sector has witness a dip in growth rate to 4.8% in January 2008 as against 9.9% in January 2007. For the period of April to January 2008, the growth has been reported at 4.8% as against 5.2% in April to January 2007.

Month wise data is as under

In million tonnes
Source - Department of Coal

1. Cumulative total may not tally with monthly total
2. Production data and Growth rates are provisional.

Jai Corp increases borrowing limit to INR 5,000 crore

Jai Corp has announced that the shareholders at extra ordinary general meeting has approved the borrowing powers of its board of directors to INR 5,000 crore and also enhance the aggregate investment limit to INR 7,500 crore. Further, it can contribute INR 25 crore to charitable and other funds not directly related to the business of the company.

Jai Corp is engaged in production of steel, plastic processing and spinning yarn. It is foraying into infrastructure, venture capital and real estate sectors.

Indiabulls Power to build power plant in Chhattisgarh

Bloomberg reported that Indiabulls Power Services Limited has won a contract to build a 1,600 MW thermal plant. Indiabulls Power beat 2 other bidders for the right to build the coal based facility in Chhattisgarh. It also won the right to a 350 million tonne coal mine.

Mr Gagan Banga CEO of Indiabulls Financial Services Limited said that the Chattisgarh plant will be built in 3 years and Indiabulls Power will get a yield of INR 2 a unit on its sale of electricity. It gets to sell 35% of the power produced to businesses, unlike projects where the entire output has to be sold to state run distributors.

The value of the mine, as per global consultants, is estimated to be valued at more than USD 7 billion.

Indiabulls Power, which raised USD 399 million from private equity firm Farallon Capital Management LLC and Mittal, is also setting up 4,000 MW power plants in 2 sites in Maharashtra.

L&T JV to add 4000 MW capacity for power equipments

Larsen & Toubro Ltd announced that it is all set to ramp up its manufacturing capacity of super critical boilers and super critical turbine generators to 4000 MW per annum. The foundation stone for the upgraded facility was laid at Hazira on March 19th 2008 in presence of Mr AM Naik CMD of L&T and Mr Ichiro Fukue representative director of Mitsubishi Heavy Industries Ltd.

L&T will be manufacturing and marketing these critical components of the large power plant through two separate joint ventures with Mitsubishi Heavy Industries of Japan, which is a global leader in this business. L&T holds 51% in both the JVs with MHI holding 49%. The JVs will have an investment of INR 1500 crore.

L&T MHI will have a product configuration catering to super critical power plants, ranging between 500 MW to 1000 MW. The engineering design centre for the boilers is based in Faridabad and that for steam turbines in Vadodara, Gujarat. The new fabrication and manufacturing facilities will be extension of present complex and will be state of the art world class set up.

The JVs had already started their operations in existing facilities at Hazira last year and have already constructed two new workshops. To further add capacities by 4000 MW, the new dedicated facilities coming up at Hazira marks a significant milestone in India's power sector.

Sical Logistics achieves financial closure for Ennore Port

Sical Logistics Limited announced that it has achieved financial closure for its Greenfield iron ore terminal project at Ennore Port. YES BANK is the lead arranger and sole underwriter for the INR 3.4 billion loan and the other members of the loan syndicate are United Bank of India, UCO Bank and India Infrastructure Finance Company Ltd.

The project is being undertaken by a special purpose vehicle, Sical Iron Ore Terminals Ltd, promoted by Sical Logistics, with 89% equity stake and L&T Infrastructure Development Projects Ltd.

The iron ore terminal is being developed on a build operate transfer revenue sharing contract with Ennore Port for 30 years including the construction period. The terminal will have a capacity for 12 million tonnes of cargo per year. Facilities include a jetty, ship loader, mechanized handling system with conveyor, storage, and wagon unloading system. Initially, the terminal will handle Panamax and Capesize vessels up to 150,000 DWT; after dredging, the terminal would be able to handle vessels of 250,000 DWT. Other features include the capability of an average 75,000 tonnes per day ship loading rate; a stockpile area that can store 2.4 million tonnes of Iron ore; and a railway wagon unloading system that can handle up to twelve 3500 tonne rakes per day.

Construction work at the terminal began recently. In principle approval has also been obtained from the Indian Railways for dedicated rail siding.

Mr Ashwin Muthiah chairman of Sical said that the financial closure of the entire debt component for Sical Iron Ore Terminals is a significant achievement considering the market conditions. He said "We are impressed with the dedication and professionalism of the team at YES BANK; taking up and delivering on the responsibility of underwriting and arranging an INR 3.4 billion loan in a single shot is no doubt a proud achievement for YES BANK.’

Chhattisgarh Energy invites bids for coal based power project

Ranchi Express reported that Chhattisgarh Energy has invited bids through the international competitive bidding route for the EPC contract for setting up a 1,200 MW coal based power unit in Jhangir Champa district.

The bids invited is divided into two parts namely, techno commercial bid and price bid. Land acquisition for the project is under process and water required for the plant has been allocated by the state government.

Last date for submission of bids is May 15th 2008.

India sees dramatic growth in fossil fuel CO2 emissions

India has experienced a dramatic growth in fossil fuel carbon dioxide emissions and the data compiled by various agencies shows an increase of nearly 5.9% since 1950. At present, India is rated as the 6th largest contributor of carbon dioxide emissions and China the 2nd. However, India’s per capita carbon dioxide of 0.93 tonnes per annum is well below the world average of 3.87 tonnes per annum.

Fossil fuel emissions in India continue to result largely from coal burning with India being the largest producer of coal in the world. India is highly vulnerable to climate change as its economy is heavily reliant on climate sensitive sectors like agriculture and forestry. The vast low lying and densely populated coastline is susceptible to rise in sea level. The energy sector is the largest contributor of carbon dioxide emissions in India.

The national inventory of greenhouse gases under Asia Least Cost Greenhouse Gas Abatement Strategy project funded by the Asian Development Bank, Global Environment Facility and United Nations Development Program indicates that 55% of the total national emissions come from energy sector. These include emissions from road transport, burning of traditional bio mass fuels, coal mining, and fugitive emissions from oil and natural gas. Agriculture sector constitutes the next major contributor, accounting for nearly 34%. The emissions under this sector include those from enteric fermentation in domestic animals, manure management, rice cultivation, and burning of agriculture residues. Emissions from Industrial sector mainly came from cement production.

India is the fourth largest producer of cement after China, Japan and the United States. The ALGAS study presents the latest set of projections of greenhouse gas emissions from India.

The Indian Cement Industry with an annual production of 99 million tonne of cement contributes about 89 million tonne of carbon dioxide emission at 0.9 million tonne of carbon dioxide per million tonnes of cement produced.

A comparative carbon dioxide emission levels in some countries are given below

In million tonnes

SAIL RSP holds free eye camp

PTI reported that, focusing on health care in the periphery, Steel Authority of India Limited’s Rourkela Steel Plant has organized an eye camp for students and elderly people under Project Sunayana.

As part of the project, a total 531 persons, including 250 students were examined by specialists.

Vizag traders blames RINL for price hike

It is reported that local steel traders have blamed Rashtriya Ispat Nigam Limited for the huge hike in steel prices and also for artificial scarcity in the local market created by the faulty policies of the management, causing irreparable loss and inconvenience to the public as well as the dealers. Steel traders said that the steel plant authorities are totally indifferent to the pleas of the local dealers to cater to the needs of the local market.

Mr V Gopala Krishna Prasad chairman of Velagapudi Steels said that a steep hike of INR 25,000 or more per tonne in a span of a month or so could not be justified on any ground. He added that "Even allowing for hike in costs of raw material such as iron ore and coking coal, the cost of production for RINL should not be more than INR 18,000 to INR 20,000 per tonne exclusive of taxes. But the ruling prices for the trade are in the range of INR 40,000 to INR 50,000 for different products."

Mr KV Bhaskar director of Vizag Profiles Limited said that "The Andhra Pradesh government has taken up irrigation projects and housing projects in a big way. All of them are badly hit by the steep hike and the scarcity. In fact, they have come to a standstill. The market simply cannot absorb such a huge hike."

According to Mr VV Krishna Rao another director of Vizag Profiles, Andhra Pradesh region would require roughly 2.5 million tonnes, but the steel plant was selling less than a million tonnes in the region. E auctions were being conducted even for small quantities, resulting in hardship to local dealers.

Plea to stabilize steel prices made in parliament

BL reported that a strong plea to stabilize steel prices was made in the Lok Sabha on March 17th 2008.

As per report, Mr Avinash Rai Khanna of BJP, raising the issue during Zero Hour, said that small industrial units in Punjab have been hit hard by the skyrocketing prices of steel. He added that unless government intervenes immediately and effectively, most of the units would close down as the steel prices have risen 3 times in 3 months.

Coal ministry may not review allotted coal blocks – Report

BS reported that union coal ministry is unlikely to review blocks allotted in 2007 to 31 power companies in the wake of allegations of irregularities in the allocations. A review, or revocation, of allotment could lead to legal tangles since some allottees have already purchased land.

As per report, the allocations are finalized by a screening committee, which is headed by the coal secretary and has about 20 odd members. These include representatives of various user industries like power, steel and cement as well as officials of state governments where the projects are located.

A senior official of ministry of coal said that "The decision of the screening committee was unanimous. We have followed a well laid out process for the allocation. There was no dissenting voice." He added that since the Prime Minister is also the coal minister, a report has also been forwarded to the PMO.

The official said that the reason for the confusion seems to be a short list of companies eligible for coal blocks drawn up by the power ministry prior to the meeting of the screening committee. He added that "It is for the first time that such a short list had been prepared. The ministry used its own yardsticks. Since there are many stakeholders in coal blocks, especially the increasingly belligerent state governments, the final list of allottees was different from the power ministry's list. They have now raised objections but they did not object at the screening committee meet. They have even signed on the minutes of the meeting."

Bharat Forge to foray into aerospace, railways & power sectors

It is reported that Bharat Forge Limited will pump in INR 500 crore initially to foray into aerospace, rail and power business.

Mr Baba Kalyani chairman of Bharat Forge said "We are getting into aerospace and railways apart from power making equipments etc."

Bharat Forge board has recently approved a preferential issue of INR 400 crore. It has already moved into the power business through its JV with NTPC to manufacture power equipment and is open to opportunities in the steel, energy, cement and mining sectors.

CRISIL assigns AA- & P1+ ratings for Ratnamani Metal & Tubes

CRISIL has assigned following ratings for Ratnamani Metal & Tubes. INR 500 million cash credit limit AA-/stable
INR 1,030 million term loan AA-/stable
INR 2,150 million letter of credit P1+
INR 1,000 million bank guarantee P1+
INR 100 million line of credit P1+
INR 400 million letter of credit bill discounting P1+

The release said that “CRISIL’s ratings on Ratnamani Metal & Tubes reflect its strong financial risk profile and leadership position in the stainless steel tubes and pipes segment, its diversification into steel pipe manufacturing, and the healthy demand prospects in end user industries. The ratings also factor in its high operating efficiencies. These rating strengths are, however, partially offset by the working capital intensive nature of Ratnamani’s operations and the susceptibility of its operating margins to fluctuating raw material prices.”

Layaja Port excluded from Gujarat development plans

It is reported that Mr Suresh Mehta former chief minister of Gujarat is unhappy over the exclusion of Layaja Port in the state government’s development plans.

Pointing out to Chief Minister Mr Narendra Modi’s reply in the Assembly, Mr Mehta said that the government’s list for the development of ports in Kutch and Jamnagar includes only the port of Modhava and not Layaja near Mandvi. He added that "Modhava is the right port for handling of imported coal for the mega coal plants, but the border district needs a passenger port and my choice as the then chief minister was the coastal village of Layaja. But before I could effectively put my plans on paper, I lost my government in 2002."

Mr Mehta further said that the Layaja project was rejected because of it was his project. He added that "Any government decision should be based on its merit, not by other considerations. Here Kutch is again the loser."

Gujarat Gas Company lines up INR 150 crore CAPEX

BS reported that Ahmedabad based Gujarat Gas Company Limited is now focusing on household gas connections and has earmarked INR 130 to INR 150 crore for the same during 2008.

A senior official at GGCL said that "We are looking at a capital expenditure of INR 100 to INR 120 crore in addition to another INR 30 crore for network up gradation in 2008. We will start providing household gas through pipeline in Kim, Karanj, Vyara, Bardoli, Jhagadia, Vilayat, Sachin, Bardoli, Olpaad, Pal, Veddabholi, Mota Varachha and Suroli in 2008."

The official said that "The profitability of gas companies hinges on the price of procurement, which could be changed with effect from April 1st 2008, when some of the contract will be renewed. Hence, it is too early to comment on the financial aspects for future."

As of now, GGCL’s pipeline network covers over 2100 kilometer. For 2008-09, it is targeting a turnover of over INR 1500 crore.

Rajasthan urges centre not to shift delivery point

The Rajasthan government has written a letter to the centre objecting to a recommendation to shift the delivery point of Cairn ONGC’s crude oil from the wellhead in the state to the Gujarat coast saying that it would result in a loss of tax revenue for the state.

A committee of secretaries has recommended shifting the delivery point from the oilfields in Rajasthan to improve the cost recovery of the USD 600 million heated pipeline to be laid jointly by Cairn India and ONGC. Selling crude at a coastal delivery point rather than at the well head will enable the pipeline costs to be factored into the selling price.

A senior official in the Rajasthan government said that "We are worried that central sales tax on the crude oil will not be levied in Rajasthan but in Gujarat if the delivery point shifts there. This will significantly dent our tax revenues."

Meanwhile, the petroleum ministry has written to the department of revenue seeking a clarification on whether shifting the delivery point of the crude oil would cause tax revenues to fall for Rajasthan.

A senior petroleum ministry official said that "We want to make sure there are no windfall income for Gujarat and no undue revenue loss to Rajasthan." He added that Cairn has already sought advice from auditing and consulting firm PricewaterhouseCoopers, which has found that central sales tax on the crude oil, levied at 4% can be collected by Rajasthan itself.

India Sri Lanka power transfer project feasibility report soon

BL reported that the feasibility study for the proposed USD 450 million mega undersea power transmission link between India and Sri Lanka is slated to be ready shortly.

Government officials involved in the exercise said that the 200 kilometer long submarine cable would enable India to export electricity to Sri Lanka and is likely to be set up with a capacity to wheel around 1,000 MW of electricity.

The report on the high voltage direct current link between the two countries is being prepared by Power Grid Corporation of India Limited, which had earlier estimated that it can set up the link in around 40 months once all clearances are in place. The link is likely to connect Madurai in Tamil Nadu and Anuradhapura in Sri Lanka’s North Central Province.

While a joint steering committee has been set up to oversee the project, a task force comprising representatives of union power ministry, central electricity authority and PGCIL on the Indian side and the Sri Lankan energy ministry and Ceylon Electricity Board on the other, has been firmed up to study the feasibility report and make recommendations to the committee.

Officials said that Indian utilities could get higher tariffs from electricity supplies to the country. Initially, surplus power would be transmitted from India to Sri Lanka using the link. They added that "With NTPC, already working on a 500 MW coal fired plant in Sri Lanka, wheeling power from Sri Lanka to India could also be a possibility over the long term."

India currently has transmission links with only Bhutan, as part of the 1,040 MW Tala hydroelectric power evacuation systems. The proposal to link up countries in the South Asian region is being seen as a forerunner to the proposed Bay of Bengal Initiative for Multi Sectoral Technical & Economic Cooperation power transmission network, which is under active consideration.

Iron ore price negotiations – Vale settles with Ilva

Companhia Vale do Rio Doce has concluded the blast furnace pellet price negotiations for 2008 with Ilva SpA, the largest Italian steelmaker and one of Vale’s largest customer in the pellet business.

As an outcome of these negotiations, the blast furnace pellet price, FOB Tubarão, increased by 86.67% relatively to 2007. Therefore, the new reference price per dry metric ton Fe unit for 2008 is USD 2.2020 for Tubarão blast furnace pellets.

Indonesia sets AD duty on HRC

Indonesia's ministry of finance decided to impose anti dumping tariffs against HRC imports from China, India, Russia, Thailand and Taiwan, and the duty is 42.58%, 56.51%, 49.47%, 27.44%, and 37.02% respectively.

Followed are the details
1. Indian Essar Steel - 12.95%
2. Indian JSW Steel - 22.25%
3. Chinese Ansteel- 25.18%
4. Chinese Baosteel - 25.18%
5. Taiwanese Chung Hung Steel - 4.24%.

(Sourced from YIEH.com)

Cosipa Hot strip mill works to start in August

BNamericas reported that works to install a new hot strip mill at Brazilian steelmaker Cosipa in São Paulo state's Cubatão city are expected to start in August. Operations are due to kick off in April 2011.

Parent company Usiminas in a statement said that Cosipa signed this week a contract worth USD 1 billion with Japan's Mitsubishi Corporation for the supply of the equipment.

The new hot rolled strip mill will have output capacity of 2.3 million tonne per year of coils in a first stage of operations and could have ability to churn out 4.7 million tonne per year, adding the equipment will provide products to the automobile and household appliances industries.

Cosipa is also currently investing USD 100 million in new continuous casting equipment, due to start operations next month.

Usiminas is the largest flat steelmaking complex in Latin America.

Vietnam government increases efforts to control steel prices

According to a new document issued by the governmental office, Mr Hoang Trung Hai deputy prime minister of Vietnam has ordered the Vietnam’s ministry of industry and trade to increase efforts to control steel trading activities.

As per the document, the ministry of industry and trade is requested to order its relevant agencies to strengthen inspection works to fight speculation, thus rigging the steel market and fight counterfeits to create a healthy and equal environment, as well as stop the illegal exports of iron ore across the borders.

The ministry of industry and trade is also urged to co ordinate closely with the Ministry of Finance to seriously deal with cartels or monopoly, increasing the prices of steel end products unreasonably as well as other violations according to the laws.

The deputy prime minister also the Vietnam Steel Corporation is requested to strengthen steel and billet production to meet to the maximum the domestic demands; control effectively its selling prices and announcing publicly their selling prices on its whole distribution network. The minister actively urge their members to boost management, practice thrift to reduce production costs thus, helping reduce steel prices. The corporation should also expand its distribution network in order to sell their products directly to consumers.

CSC announces equity swap with Dragon Steel

China Steel Corporation announced that it will use its own shares to swap for equity share in Dragon Steel Corporation from Dragon Steel Corporation's shareholders.

According to the transaction, 2.6 shares in Dragon Steel Corporation will be swapped for one share in the Company.

Vale board approves merger of FGC

Companhia Vale do Rio Doce announced that its board of directors has approved the merger of all shares of Ferro Gusa Carajás SA into Vale.

The release added that “Therefore, the proposal will be submitted to the approval of Vale’s shareholders at a meeting to be announced opportunely.”

Hoa Sen Group inaugurates coating line

VNA reported that Vietnamese Hoa Sen Group on March 19th 2008 inaugurated a 150,000 tonne aluminum zinc plated corrugated iron factory in southern Binh Duong province of Vietnam.

Based in the Song Than II Industrial Park, the USD 30 million factory is equipped with advanced burning technology to turn out high quality products to be used in construction.

The group also put into operation the second 50,000 tonne plated corrugated iron production line, raising the factory’s total current capacity to 100,000 tonnes.

Mr Hoa Sen CEO Le Phuoc Vu said his group’s annual revenue has increased to more than VND 2 trillion from VND 3 billion when it was first set up six years ago. Mr Vu said the group is striving to become one of the country’s leading corrugated iron and steel producers, adding that Hoa Sen will increase investment in other areas such as construction materials, real estate, finance and seaports.

Vale wins court order against protesters

Bloomberg reported that Cia Vale do Rio Doce, has won a court order that forbids protesters from attacking its units and forcing the company to stop operations.

A Rio de Janeiro state court granted an injunction forbidding militants from the Landless Workers Movement from inciting and promoting violent acts against the company and protesters may be fined for disobeying the order.

Militants have attacked Vale and other multinational companies in Brazil in the past year to protest expansions into land they say should be distributed to small farmers. Vale said its units have been hit eight times since 2007.

CSC Q4 profit up by 3.2% YoY on higher prices

It is reported that Taiwan's largest steel maker China Steel Corp had a 3.2% gain in fourth quarter profit as increased demand enabled the company to raise prices and more than offset higher costs. It net income in Q4 rose to NTD 12.9 billion from NTD 12.5 billion a year earlier. Profit for 2007 climbed 31% to NTD 51.3 billion. Full year sales surged 17% to NTD 207.9 billion.

China Steel Corp increased prices by an average 0.48% in the fourth quarter compared with the previous three months after a total gain of 6.2% in the nine months to September.

CSC increased prices for local customers four times last year on rising demand from builders and manufacturers. The island's gross domestic product expanded 5.7% in 2007, the fastest rate in three years, boosting consumption of the alloy.

Mr Allison Lu an analyst at Capital Securities Corp in Taipei said that “Demand in the steel market has been quite good. The company has been able to pass on increased costs.''

Colombian ferronickel mine may restart labor talks

Reuters reported that labor talks at Colombia's Cerro Matoso ferronickel mine, which produces 4% of the world's nickel, may restart as early as this weekend.

A company official said that “As a strike by workers entered its third week. We hope we can reinstate talks with the union this weekend or early next week. Meanwhile the mine is not producing anything.” The official added that miners are asking for more pay and better safety conditions, but the main dispute is over outside contractors. The union opposes the use of such workers while the company says they are necessary for short-term exploration, construction and other projects.

Mr Roger Herrera president of the Sintracerromatoso union representing Cerro Matoso miners said that "Contract workers are poorly paid but they run the same risks that we do in terms of noise and contamination. We are willing to talk when the company is ready to show some flexibility on this.”

BHP Billiton owns the Cerro Matoso mine, which is located in Cordoba province and produces 55,000 tonnes of ferronickel annually. The supply interruption caused by the strike has supported global nickel prices. The work stoppage began on February 27 after a breakdown in talks over a new two year contract for the plant, which employees around 3,000 people.

Sidenor net profits in 2007 fell to EUR 92 million

Greek metals company Sidenor said that its full year group net profits fell to EUR 92 million in 2007 from EUR 108 million in 2006 because of an unfavorable comparison with 2006, given that they had EUR 22.9 million deferred tax credit.

Sidenor’s 2007 sales rose by 13% YoY to EUR 1.39 billion due to strong demand for steel products in the first six months of 2007. Other factors contributing to solid turnover were strong exports in Balkan markets, exports from its Bulgarian subsidiary Stomana to European markets, as well as contributions from its Greek unit Corinth Pipeworks at higher prices from value added products.

Sidenor explained that EBITDA for the full year dropped by 3% YoY to EUR 213 million as margins were pressured from a fall in demand for steel products in the second half of 2007. It added that it is committed to expanding overseas and has reinforced its sales network in Albania, Romania and Cyprus.

The Sidenor group said that it will expand its product range, increase its value added goods and said that in combination with higher steel prices for the first half of 2008, it has a positive business outlook for the year.

1 dies in fall from crane at Ipsco

It is reported that a person died following a 100 foot fall from a crane at Ipsco Steel mill.

According to the Capt CJ Ryan Muscatine County Sheriff’s, the medical examiner has been contacted and an investigation of the accident is under way. No other details about the accident or the victim were immediately available.

Illinois based Ipsco has about 420 employees at the Montpelier plant, and another 150 contract workers. The steelmaking and fabricating plant is one of three steelworks the company operates in North America.

Mozambique pushes for mining investments

APA reported that Mozambique has approved an aggressive campaign to lure mining investments capital, process and market the country’s vast mineral resources.

Ms Fatima Momade national director of mines told APA that “The strategic plan, already approved by Mr Armando Guebuza president of Mazambique seeks to attract investors to mine, process and market Mozambique’s vast mineral resources, including coal, base metals, uranium, tantalite, gold and copper. She said that “Right now mining contributes about five percent of GDP (gross domestic product), but we expect that to increase threefold to 15% in about five years.”

She said Mozambique has revamped its geological infrastructure and its mineral information systems and improved legal and regulatory framework to attract investors. She added that “Already we have seen a huge jump in mining trends. Mining licenses already issued jumped from about 300 in 2002 to a peak of more than 1,000 last year, while Investment figures in exploration and development grew from USD 24 million in 2002 to a projected USD 227 million in 2007.”

Mozambique’s mineral resources include gold, marble, heavy minerals from coastal sands, pegmatite, iron ores, diatomite, bentonite, tantalite, graphite, precious and semi-precious stones, bauxite, granite, phosphates, clays, asbestos, beryllium and mica.

Vietnam would further reduce coal exports

It is reported that Vietnam has decided to supply domestic market for first priority and reduce its exports gradually. The total quantity of coal in Vietnam reached some 30 million tonnes and it ranked the first biggest producer in South East Asia.

Vietnam’s main coal export markets were China, South Korea and Japan, accounting around 90%in total.

(Sourced from YIEH.com)

NSSC cuts 300 series SS production

Japanese Nippon Steel & Sumikin Stainless announced to cut its stainless steel 300 series output by 10% in March 2008 because domestic demand is still weak.

Nippon Steel & Sumikin Stainless is Hikari plant located in western Japan will cut production the plant has monthly production capacity of 50,000 tonnes.

In February, Nippon Steel & Sumikin Stainless also decreased their output. The company will start to annual overhaul and close for two or three weeks in May.

(Sourced from YIEH.com)

Ton Yi Industrial to invest in JFE Holdings

Because of the continuing high material cost everywhere, Taiwan Ton Yi Industrial Corp one of the major tinplate manufacturing company, has decided to invest in Japan’s second largest steel mill JFE Holdings, Inc to improve the company's future business performance.

JFE Holdings is Ton Yi's major hot roll material supplier and is the only the medium size customer for JFE Holdings and Ton Yi's business needs JFE Holdings to provide them with strong support. Therefore, Ton Yi investments in JFE Holdings will knit both companies more closely together for future cooperation.

(Sourced from YIEH.com)

Sasol to unveil USD 2.22 billion deal with BEE on March 25

Reuters reported that South Africa's Sasol the world's biggest producer of fuel from coal, would announce detailed terms of a ZAR 17.9 billion (USD 2.22 billion) affirmative action deal around March 25.

The plan to sell a 10% stake to black investors, staff and the public is the biggest affirmative action plan yet in South Africa. It was announced in September 2007.

Under its previous management, Sasol attracted sharp criticism from the government for dragging its feet on black economic empowerment.

Tanzania seeks investors for iron Ore and coal mines

The Citizen citing the National Development Corp reported that Tanzania has hired a group led by international law firm DLA Piper to find foreign investors for planned coal and iron ore mines and a 400MW power plant,

The newspaper citing Mr Gideon Nasari MD of National Development Corp as saying that the contract terms and an international tender for the development of the Mchuchuma coal and Liganga iron ore reserves in the southwest of the country should be ready in 12 months.

The news paper added that Tanzania plans to use the coal to generate electricity and produce steel from the iron ore.

Tamaya to add to Filipina Grande copper inventory

Tamaya Resources Ltd announced that it has signed an option to acquire Mina Grande, a strategically and commercially important lease contiguous with its wholly owned Filipina Grande project in Region III in Chile. The option has been agreed on a cash and royalties basis.

Mina Grande has a copper resource inventory, based on previous estimates and 4600m of drilling, of 9 million tonne at 0.6% of Cu of oxide copper overlying about 4 million tonne of sulphidic copper gold iron oxide mineralisation. Including these mineralization estimates at Mina Grande, the Filipina Grande project in its entirety now includes an inventory of 27 million tonnes of mineralisation, representing about 250,000 tonnes copper in situ.

Mr Hugh Callaghan executive chairman of Tamaya said that "Mina Grande represents good value to Tamaya in a region of growing interest to copper companies. Through the Option agreement, and based on previous estimates, from day one we have the potential to add 177 million pounds of copper to our inventory at a price equivalent to around USD 0.01 per pound.”

Tamaya Resources Limited, formerly SMC Gold Limited is involved in the activities of gold and copper mining and mineral exploration. The Company’s controlled investments include Rishton Gold Pty Ltd, which is engaged in administration; SMC Gold Chile Limitada, which is a holding entity; Punitaqui Pty Ltd, which is engaged in mining of copper; Compania Minera Tamaya SCM, which is engaged in mining of copper and gold; Compania Minera Punitaqui SCM and Compania Minera Los Mantos, both of which are engaged in mining of copper.

ArcelorMittal to get US Energy Star award

Recognizing its contribution to environment protection through energy efficiency, the US government has selected ArcelorMittal for its "Energy Star Partner of the Year" award.

ArcelorMittal will be the first ever steel company to get Energy Star award. The award will be presented the award by the US Environmental Protection Agency here on April 1

The 'Energy Star Partner of the Year for Energy Management' award is given by the Environmental Protection Agency and the US Department of Energy for companies making outstanding contributions to protecting the environment and reducing greenhouse gas emissions through energy efficiency.

ArcelorMittal said in a statement that in late 2005 it was challenged to cut energy intensity by six per cent over a three year period, using 2005 as the baseline. This equates to a reduction of USD 192 million in energy costs by 2009.

ArcelorMittal Energy Committee was established in late 2005 with representatives from every US facility and each facility was responsible for setting energy reduction goals at their respective plants.

Fenix Metals to install a vacuum distillation unit in Poland

Europe’s second largest tin recycler, Fenix Metals in Poland is installing a vacuum distillation unit to produce up to 3,500 tonne per year of refined tin. The installation is expected to be commissioned in August 2008.

The Polish plant will be installed by the inventors of the vacuum distillation technology, Dan Engineering of Copenhagen, Denmark. Dan Engineering is the majority shareholder in Fenix Metals, which is a joint venture with Stoop NV of Belgium.

Fenix Metals commenced operation in 2004 as a secondary tin smelter and solder producer and has enjoyed continuous expansion since. While being a major supplier of tin lead alloys to many European markets, the new installation will enable Fenix Metals to also supply pure tin and more lead free solder products to its customers.

Falcon Metals in Dubai, which is a sister company to Fenix Metals and member of the Dan Engineering Group, is also planning the installation of vacuum technology, which is expected to be operational in 2009 with a similar capacity.

Vale plans to add 62,000 jobs in next 5 Years - Reports

Bloomberg reported that Brazil Cia Vale do Rio Doce, the world's largest iron ore producer is planning to add 62,000 jobs over the next 5 years as the company boosts output to meet demand.

The paper quoted Mr O Estado de S Paulo as saying that the company is planning to employ more people in Brazil, US, England, Australia and Canada.

Rautaruukki helps speed up completion of Flamingo in Vantaa

Rautaruukki delivered and installed steel frames to the Flamingo recreational centre to be opened in autumn 2008 at Vantaa in Finland. The building is 12 storeys at its highest and totals 87,000 square meters in floor space, about the size of 12 football pitches. The total value of the delivery was over EUR 6 million.

Rautaruukki’s frame delivery method helped to speed up construction to such an extent that the centre is expected to be completed in September this year, two months ahead of schedule.

The method involved section by section installation and Ruukki’s frame production units at Ylivieska, Kalajoki and Peräseinäjoki, Finland had real time updates on how work was progressing throughout. In addition to the steel frame, Ruukki also supplied the installation of prefabricated concrete elements.

Mr Markku Muhonen project manager of SRV said that “Rautaruukki did so well in supplying the frames that the building will be completed ahead of schedule. Their success was based on first rate design and strict monitoring of progress.”

Flamingo, which is under construction next to the Jumbo Shopping Centre in Pakkala, Vantaa, is the first recreational centre in the Nordic countries. The recreational centre will house a hotel, shops, leisure centre, waterpark, spa and a health and fitness services. A bridge will connect Flamingo to the Jumbo Shopping Centre.

James River to sell 3,000,000 shares of common stock

James River Coal Company announced that it has agreed to sell 3,000,000 shares, with an over allotment option to sell up to an additional 450,000 shares, of its common stock in a public offering through UBS Investment Bank.

Mr Peter T Socha chairman & CEO of James River Coal Company said that "The proceeds of this offering will be used, in part, to accelerate the development of several smaller internal projects that we have delayed for the past couple of years due to conditions in the capital markets and soft coal prices. The projects include the recovery of waste coal from an existing JRCC site and several smaller projects to reduce operating costs from current mine production."

Rickmers to buy 13 ships for USD 1.35 billion

Reuters reported that Singapore listed shipping trust Rickmers Maritime will buy 13 container ships worth USD 1.35 billion from its parent company.

As per report five of the ships will be leased to Mitsui OSK, four to Hanjin Shipping and four to AP Moller Maersk MAERSb CO.

ABB wins USD 150 million contract from Netherlands

ABB the leading power and automation technology group, announced that it has won a USD 150 million contract to provide power systems and grid connections for a natural gas and steam turbine power plant to be built in the Netherlands. The new plant will consist of three units, each producing about 430 MW. The power plant is scheduled to go on line in early 2011.

The new 1,300 MW Nuon Magnum power plant for the Dutch utility Nuon will be located in Eemshaven in the province of Groningen on the North Sea coast. Initially, the combined cycles will be fired with natural gas. At a later date, Nuon aims to convert the power plant to a fully integrated gasification combined cycle plant, accommodating carbon capture technologies. The gasifier will convert coal and biomass into syngas, a mixture of CO, CO2 and hydrogen, which will be used to fuel the combined cycle power plant.

ABB’s scope of supply includes electrical components for the auxiliary power supply systems, a 380 kV high voltage substation and the switchgear building.

Mr Peter Leupp head of ABB’s Power Systems division said that “ABB has world class expertise in the power generation sector. Our innovative technology will ensure that this power plant will be one of the most energy efficient in the world.”

ABB is a leader in power and automation technologies that enable utility and industry customers to improve their performance while lowering environmental impact. The ABB Group of companies operates in around 100 countries and employs more than 110,000 people.

AK Heavy Engineering secure contract for Canadian nickel mine

AK Heavy Engineering has secured a major CAD 25 million order for the supply of hoisting equipment for two new shafts at the Nickel Rim South underground deposit definition project at Sudbury in Ontario

The latest contract entails the supply of a new 5500mm diameter, main shaft production hoist, a 4600mm multi rope service hoist, two new 3100mm auxiliary hoists, one for the main shaft and the other for the adjacent egress shaft and the refurbishment and testing of an existing 4600mm hoist for shaft sinking duties.

The customer, Falconbridge of Toronto, is the third largest producer of refined nickel in the world and earlier this year announced a USD 550 million exploration program at Nickel Rim South, with production expected to start in 2008. This represents one of the highest grade deposits found in Canada’s Sudbury Basin, with inferred resources estimated at 13.7 million tonnes.

Part of the Kvaerner Group, Sheffield based AK Heavy Engineering is one of the worlds leading suppliers of mine hoists and associated equipment, with a strong track record of work in Canada.

Eldorado Corporation signs a non bidding MoU with BHP Billiton

Eldorado Gold Corporation announced that it has signed a non binding MoU with BHP Billiton regarding the future sale of iron ore from Eldorado's Vila Nova Iron Ore Project at Amapa State in Brazil.

Eldorado said that “We expect to finalize terms of a binding Long Term Supply Agreement with BHP Billiton in the next few weeks.” The terms and conditions of the MoU, under which the Long Term Supply Agreement will be structured, provide for 100% of the first 3 years of production of lump ore and sinter fines from the Project to be purchased by BHP Billiton FOB Santana Port in Amapa State. It added that the Project, presently forecasted to have a life of mine of 9 years, is expected to produce approximately 900,000 dry metric tonnes of lump ore and sinter fines per year.

Eldorado will own 75% of the Project by financing approximately USD 39 million of pre production capital expenditures, including working capital and certain property payments to our Brazilian partner, Mineracao Amapari SA who maintains a 25% interest in the Project.

All permits required to initiate construction have been obtained and site clearing has been completed. Purchase orders for long lead items such as the crushing and screening plant have been issued. We expect to initiate mining activities during the fourth quarter of 2008 and begin shipping of lump ore and sinter fines from Santana Port during the first quarter of 2009.

Mr Paul N Wright president & CEO of Eldorado said that "We are gratified to have a commercial partner as reputable as BHP Billiton associated with this Project. The financial performance of Vila Nova Iron Ore is very robust and will allow us to retain an operational and exploration base in Brazil and South America, where we will continue to look for opportunities in the gold sector."

Eldorado is a gold producing and exploration company actively growing businesses in Brazil, Turkey and China.

Zeehan Zinc appoints Mr Ballantye as chairman

Zeehan Zinc Ltd announced that it has appointed Mr Ted Ballantyne as its chairman and Mr Xiaojian Ren as its managing director as Mr Michael Roberts, Mr Brian Caffyn and Mr Nicholas Wrigley have resigned from the board, effective March 16th 2008.

Zeehan Zinc is an operating mining, project development and exploration company, mining and processing zinc, lead and silver deposits at Western Tasmania in Australia. Exploration efforts include searching for winnable Nickel deposits.

Baobab Resources reports positive results from Seymour

Thomson Financial reported that Mozambique focused iron ore, base and precious metals exploration company Baobab Resources PLC has reported further positive drilling results from its Mundonguara copper gold project and the Seymour prospect.

Baobab said that the intercepts reported from Mundonguara provide further support to the company's confidence in the potential for broad zones of low grade copper adjacent to the previously mined mineralization. It said that the assay results for the remaining four holes drilled from a 10 hole transect at the Seymour prospect have been returned with significant results reported.

Mr Ian Cullen managing director of Baobab Resources said that "The new intercept at Seymour indicates that there are at least three sub parallel mineralized zones in the area."

UAE steel prices surge by 12% in 3 weeks – Report

Reuters reported that rear prices in the United Arab Emirates have risen at least 12% in the last three weeks as demand from construction contractors has increased and supply has tightened.

The report cited a trader as saying that a tonne of rebar fetched around USD 970 this week as compared to USD 860 in the last week of February.

The market sources said that "Demand for steel is increasing everyday and many contractors want to meet the deadline for their projects at any cost. On the other hand, the availability of steel is decreasing, and that is why prices are rising and they may soon hit USD 1,000. So if you are a small contractor you are facing a major problem."

They added that "Many suppliers won't sell if you are asking for less than 300 tonnes of steel, and some have much higher ceiling for orders.”

Qatar to set up 1.2 million tonnes molten steel plant

Doha Times reported that Qatar is planning to set up a 1.2 million tonnes plant for production of molten steel. The project also envisages production of some 800,000 tonnes of rebar.

Mr Yousef Hussein Kamal Qatari minister of finance said that the project is most likely to be awarded this year. He added that Qatar Steel had taken steps to meet the demand for iron and steel by boosting their production. Qatar’s economic boom has placed a lot of demand on building materials. There has been a significant increase in the consumption of these materials worldwide too.

Mr Kamal said that Qatar Steel had come a long way since its establishment in 1974 as the first integrated steel plant in the Gulf.

Qatar Steel has embarked upon a series of initiatives aimed at increasing its production capacity. The ongoing modernization and expansion projects are designed to produce world class products, which will further enhance the company’s presence in the world of steel production.

Sonasid 2007 net profit up by 21% YoY

Moroccan steel major Sonasid has announced following results for 2007

In MAD

The main shareholders of Sonasid are ArcelorMittal and Moroccan investment firm SNI. It controls four fifths of the local market for long steel products.

Ezz 2007 net profit up BY 14.3% YoY

Reuters reported that Egypt's Ezz Dekheila Steel has posted net 2007 profits of EGP 2.296 billion. The figure is a 14.3% YoY rise as against profits of EGP 2 billion in 2006.

Ezz Dekheila is Egypt's largest listed steel company by market value.

Aramco rules out sale of more stakes

A Saudi Aramco spokesman said that it has no plans to exit more overseas refining ventures following the sale of its stake in the Philippines' top refiner Petron Corporation last week.

He said that "There are no plans to sell any of our interests in other refining ventures. There has been no change in Saudi Aramco's long term strategic objectives both at home and abroad."

Aramco is increasingly focused on its USD 50 billion domestic upstream and downstream expansion program and on international markets with the potential for substantial future demand growth for refined products.

Largest ever physical steel delivery at DGCX

It is reported that steel Rebar April 2008 contracts of the Dubai Gold & Commodities Exchange have registered a nearly 6.25% gain last week, as the contracts began the week at USD 908 per tonne and rose to an intra week high of USD 964.

Last week also marked the largest ever physical steel rebar delivery at DGCX. 460 tonnes of steel rebar were successfully delivered by Wealthkare Commtrade DMCC, a broker clearing member of DGCX, through the DCR system. Vision Commodities Services DMCC, another broker clearing member of DGCX, undertook the delivery of 260 tonne of reinforcing steel bar.

Vision Commodities Services, in a statement, said that "This successful physical delivery in such high quantities opens the gate for steel producers, traders, and stockiest to hedge their price risk on the DGCX platform. It also creates a wide array of opportunities like cash futures arbitrage in steel rebar."

The demand for steel rebar is on the rise from the construction industry in UAE, where more than USD 1 trillion worth of infrastructure projects is in the pipeline.

RAK Cement to hike prices for products

Ras Al Khaimah Cement Company said that the government must allow price increases or it will collapse.

Mr Mike Richardson CEO of RAK Cement said that "We have to increase our prices this year just to survive. I would think we would need about a 15% price increase.'' He added that it has asked the government to lift a cap of AED 295 per tonne on cement that the government imposed in 2007.

The six Gulf States, including Saudi Arabia and Kuwait, have more than USD 1 trillion worth of construction and projects planned, straining resources and increasing costs. The UAE is investing in real estate, tourism and finance to diversify its economy away from oil and gas. Its economy grew at 7.4% in 2007 down from 9.4% in 2006.

RAK Cement posted profit of AED 55 million in 2007 as compared with AED 126 million in 2006 as the cost of fuel rose while the price of cement was capped.

IPIC inks MoUs with Uzbek firms to set up JV projects

It is reported that International Petroleum Investment Company has signed two MoUs with Uzbekistan's oil & gas and chemical companies to set up JV projects in the Republic of Uzbekistan.

The MoUs were signed in the presence of Mr Elyor Ganiev minister of foreign economic relations, investment & trade of Uzbekistan.

UASC sets container export record at Port Sultan Qaboos

Khaleej Times reported that United Arab Shipping Company has set a record recently for the highest volume of exports from Port Sultan Qaboos. Vessel MV Barzan has loaded more than 500 TEUs of local export cargo from Oman for discharge in Shanghai resulting in the largest export volume of full containers from Port Sultan Qaboos for one vessel call.

The 1561 TEU capacity vessel is one of the 5 ships deployed by United Arab Shipping Company on their Arabian Gulf Express extended main line route. This service will connect Oman to the Far East and China calling Port Sultan Qaboos twice a week on East and West bound calls.

United Arab Shipping Company has continued to supporting Oman’s commercial trade with other countries over the years by directly linking shipping connectivity with various countries. Port Services Corporation’s marketing efforts to attract big shipping lines in cooperation with local agents have resulted in higher volumes of import and export through Port Sultan Qaboos.

Port Services Corporation’s operations, harbour and marine departments coordinated the swift and safe berthing and loading operations in cooperation with United Arab Shipping Company’s local shipping agent Bhacker Haji Abdullatif.

Gulf States urged to sever links with dollar

Khaleej Times reported that pressure is mounting on central banks in the Gulf to fight surging inflation when they meet tomorrow by severing the link between their currencies and the tumbling US dollar. Officials in Qatar and the UAE have denied rumors of an imminent decoupling, but investors are betting on reform and are rushing to buy local currencies as investment banks issue fresh calls for revaluation.

The report cited an analyst as saying that "The feeling is that unilateral moves would only cause more confusion and difficulties for those countries who try to maintain the peg."

With central banks unable to lower interest rates to tackle inflation, the Gulf States are trying other measures. Qatar has frozen rents for two years and the UAE has announced price controls on basic foods and said that it would cancel customs levies on cement and steel imports. Yet there is a consensus emerging that something more drastic needs to be done to achieve lower inflationary targets, such as the 5% goal that the UAE announced last week.

Mr Zahed Chowdhury head of Middle East research in Dubai for Deutsche Bank said that "A revaluation is certainly required to ease inflationary pressures. The currency peg with the dollar worked well while both economies were moving in the same direction. Now, these two economic blocks are moving in completely opposite directions and it no longer makes sense."

Faced with rising construction and labor costs, Gulf corporations are leading the call for currency reform. Business leaders complain of a looming labor shortage as companies struggle to lure foreign workers, and said that shortfalls of increasingly expensive European imports threaten the region’s building boom.

DMCC to set up investment firm to enhance investment product

Khaleej Times reported that Dubai Multi Commodities Centre is planning to set up an investment firm to develop investment products on the regional commodities market. Dubai Commodity Asset Management will form a 51:49 JV called Dubai Shariah Asset Management with US based advisory company Shariah Capital to develop and manage a range of Shariah compliant investment products.

Mr Ahmed bin Sulayem executive chairman of DMCC said that the initial capital will be AED 91.5 million. He added that "We believe such products will be of great interest to institutions and high net wealth investors who are looking beyond traditional investment areas."

Mr David Rutledge CEO of DMCC said that the launch of DCAM and DSAM aims to provide physical, financial and market infrastructure for building commodities marketplace in the region. He added that "There is massive growth in Shariah compliant asset management funds and total global assets in Islamic equity funds have reached USD 18 billion. The market is expected to grow rapidly and DSAM offers high potentials for different commodities-based asset management products in the region."

Mr Eric Meyer CEO of Shariah Capital said that it is publicly traded on the Alternative Investment Market of the London Stock Exchange. He added that "We have a Shariah Supervisory Board that supervise the implementation of Shariah rules in all funds managed by the company."

Iron ore price negotiations – China denies meddling

It is reported that China has denied it is interfering in fraught iron ore price negotiations, assuring Australia that delays to Australian spot imports are not part of any state backed plan to put pressure on recalcitrant miners BHP Billiton and Rio Tinto.

Dr Geoff Raby Australian ambassador to China said that "We have sought advice and guidance from the Chinese Government on what is going on and been given assurances. We have no evidence that there is direct government guidance on this. If there is evidence of direct government involvement, we will raise it with the Chinese Government and point out that these commercial transactions should be left in the hands of business."

But Dr Raby said he did not think there was any systematic attempt to block Australian spot cargoes. He said "But it doesn't mean that various industry groups representing different importers are not, for their own ends, making statements that they hope will influence behavior.”

He had earlier said that there was no place for Chinese government interference in the iron ore price talks but that at this stage there was no evidence of any systematic or government backed campaign to ban Australian spot imports.

As per report, 3 iron ore spot cargoes from Australia have been stranded after being unloaded at Xingang port as the China Chamber of Commerce of Metal, Mineral, Chemicals and the China Iron and Steel Association delayed the issuing of export licenses.

Midwest says Sinosteel needs to boost offer by 25%

Bloomberg reported that Midwest Corp target of AUD 956 million hostile bids from Sinosteel Corp needs to raise its bid by at least 25% to acquire the Australian iron ore producer. Midwest closed above Sinosteel's bid price, signaling investors expect a higher offer for the supplier of the steelmaking material.

Mr Bryan Oliver Chief Executive Officer of Midwest said the board would study any offer from Sinosteel for a minimum AUD 7 a share. China's second biggest iron ore trader which owns a 19.9% stake in Perth-based Midwest made a cash bid of AUD 5.60 on March 14th 2008.

Mr John Veldhuizen an analyst at BBY Ltd said that “There is a real chance they would pay AUD 7 a share. They are definitely in the game to have a seat at the table to have some sort of control over where iron ore is going. They are short the stuff and they need it, end of story.''

Baosteel to acquire two mills in Guangdong Province

Reuters reported that Baosteel Group will acquire two small rivals in Guangdong Province in conjunction with the launch of a mammoth steel mill project as China consolidates the fragmented sector. It did not indicate whether the listed units of the companies to be acquired, Liuzhou Iron and Steel Co Ltd and Guangzhou Steel would be delisted after the acquisition.

China's National Development and Reform Commission said in a statement that Baosteel Group, parent of Baoshan Iron and Steel Co Ltd will take over, Iron and Steel Group and Guangzhou Iron and Steel Group. It said Baosteel also obtained NDRC approval for the first phase of construction of a large steel mill in Zhanjiang a port city in Guangdong province.

NDRC said Guangdong Province will scrap 10 million tonnes of outdated steelmaking capacity in conjunction with the Zhanjiang project, while the Guangxi region will shut 9.1 million tonnes.

NDRC statement said the two projects are also part of China's plan to develop the Gulf of Tonkin coastline and the eastern area of the Guangdong province neighboring Hong Kong.
Wed Mar 19, 2008 7:52am EDT

Jiexiu Xintai orders for a 1.2 million tonne heavy section mill

Shanxi, province based Jiexiu Xintai Iron & Steel Co Ltd has placed an order with SMS Meer for the supply of a section mill for the rolling of beams in the dimensional range of 200mm to 1,000 mm. The mill is designed for 1.2 million tonnes per year. Hot commissioning of the mill is scheduled for 2009.

The heavy beam mill is equipped with modern universal stands of the CCS® type. Due to the hydraulic adjustment control system and the highly rigid mill stand design, the final dimensions can be rolled within a narrow tolerance range. The 9 roller CRS® compact roller straightener with straightening rollers mounted in bearings on both sides, with hydraulic adjustment and automatic straightening roller changing allows high flexibility and straightening quality with minimal residual stresses. Program changing on the mill train takes no more than 20 minutes. The rolled stock is divided up into finished lengths by means of the proven SMS Meer cold saw technology, which is characterized by its low cutting costs. This heavy beam mill also uses SMS Meer's patented XH® universal beam rolling principle.

It will further increase China’s capacity for parallel flanged beams and thus satisfy the high domestic demand for these. The supply scope includes the planning and engineering, the technological core equipment, the training of the customer’s personnel and the supervision of erection and commissioning.

7 Chinese enterprises launch response to US probe into steel pipes

According to China Chamber of Commerce of Metals Minerals & Chemicals Importers & Exporters 7 Chinese enterprises including Tianjin Shuangjie Steel Pipe Company Ltd and Shanghai Metals and Minerals Import & Export Co will launch group response to US antidumping and countervailing duty investigations on imports of circular welded carbon quality steel pipe from China.

Allied Tube & Conduit, IPSCO Tubulars Inc, Northwest Pipe Company, Sharon Tube Company, Western Tube & Conduit Corporation, Wheatland Tube Company and the United Steelworkers are the petitioners for these investigations.

This is US first dual probe into Chinese steel products. Chinese enterprises started active response since the application by US enterprises in June 2008.

(Sourced from MySteel.net)

Baosteel ink supply contract for cable rope of Minpu bridges

It is reported that recently Baosteel Group Ergang Company Ltd by virtue of its integral brand advantage for high end steel for cable rope of bridges exclusively won the bid for galvanized steel cable supply contract for cable rope of Shanghai Minpu Bridge-the 2 pylons, double cable plane and dual floor highway bridges with the largest span in the world.

Minpu Bridge which is located between Fengpu Bridge and Xupu Bridge is the 8th bridge across the Huangpu River. It is another landmark building of Shanghai and is the first large dual floor highway bridges across the Huangpu River. Minpu Bridge is 3610 meter in length totally among which the main bridge is 1212 meter long.

The main span of the bridge crossing the river in one span is 708 meters the main pylon is 214.5 meters high. The upper floor is highway while the lower floor is ordinary road.

Chinese HRC export price keeps firm

It is reported that export offers for HR steel coil are quite strong this week despite softening in domestic market prices.

Export offers for commercial HRC are prevailing at USD 855 per tonne to USD 865 per tonne FOB and transaction price is said to be quite close at moment.

A Hebei based steel maker told Mysteel that its allocation for April production is fully booked and most are concluded at USD 855 per tonne to USD 860 per tonne FOB base. It will not announce its price for May production until April.10th 2008.

Another steel mill in Shandong Province is quoting commercial 4.5mm to 11.5mm HRC at USD 865 per tonne FOB, April production and May shipment. It indicates that overseas demand is strong enough to shoot up price to around USD 900 per tonne FOB in April.

(Sourced from MySteel.net)

Chinese domestic iron ore concentrate price dips on thin trade

According to China Iron & Steel Association in a latest data the roaring raw materials price has seemingly run out of steam as domestic ore concentrate price has slipped CNY 20 per tonne in mid March 2008 from the start of the month.

As a result, some steel mills have lowered the purchase price due to weakening steel prices in recent days. Meanwhile, many buyers are sitting on the fence in light of softening ore price in certain regions. In particular, Fe 66% ore concentrate price down by CNY 20 per tonne to CNY 1580 per tonne in Tangshan and Hebei these days.

The underlying reason it that the fresh ore capacity has been utilized, and mounting imported ore is arriving, therefore, the market supply has been eased substantially. The ore price has also moved downward in Northeast and East China. Meanwhile, the spot ore imports market has seen thin trade recently as traders are holding out for higher price while steelmakers are faced with steep cost pressure.

Beijing Business News cited senior analyst of Mysteel as saying that "The wait and see mentality prevails at both the steel market and raw materials market while the steel prices and iron ore price are undergoing a normal correction at the moment. The analyst said the steelmakers would press down the purchase price further to ease the cost pressure however, the market fundamental is critical to future price trend.”

(Sourced from MySteel.net)

WISCO starts operating world largest coke oven

It is reported that WISCO recently started trial operation of the 7.63 meter coke oven, the largest and most advanced in the world and would thus save CNY 5 million per day for coking coal purchase.

An executive of WISCO said the coke oven, including two seats, costs CNY 1.5 billion. Coupled with supported facilities and recycling equipments, total investment comes to CNY 3 billion.

Mr Wei Song general manager of the Wuhan Steel based steelmaker said the new coke oven is environment friendly and takes much less coal gas in operating and able to process coal tar dregs into small coal ball.

(Sourced from MySteel.net)

Fangchenggang steel complex gets approval

It is reported that the State Council has already approved the preparatory construction work at the site of the 10 million tonnes per year steel complex in Fangchenggang

Mr Xuan Peijun the municipal governor of the city said that output from the new plant will include HRC, CRC, HDG and plate, targeting the booming heavy industry market in Beibu Bay. He said that around 4 million tonnes per year capacity will be plate.

EU AD duty on Chinese coke not to effect trade

It is reported that EU’s recent imposition of anti dumping measures in the form of a minimum import price on coke over 80mm from China would not have any effect on export of Chinese coke to Europe as EU will collect the gap price if China origin coke in pieces with a diameter of more than 80mm comes below EUR 197 per tonne for landed price, whereas the current levels are skyrocketing.

An industry source said this measure is a little out of season as China's coke export price has exceeded the minimum level of EUR 197 per tonne the measure set. China's coke price was raised seven times in 2007, with export offer hitting record too. At present, the metallurgical coke is sold at CNY 2000 per tonne at home, lower than foundry coke's.

This is the second time EU accuses China on coke export. In 1999, the union executed a duty on China's foundry coke EUR 32.6 per tonne starting December 2000. In 2003 to 2004, there was a short supply in European market, and the union suspended duty collection.

Corrigendum on China's province wise crude iron ore production in 2 months

The article which was published on March 17th 2008 on China Province wise crude iron ore production in 2 months was misprint as referring to iron ore instead of ferroalloys.

The actual data for iron ore is given below

China’s crude iron ore output in February 2008 is reported at 53.227 million tonnes up by 26.5% YoY. And during, January to February 2008 it is reported at 101.218 million tonnes up by 24.7% YoY.

Province wise crude iron ore production is as under

In million tonnes

(Sourced from MySteel.net)

Terra Nostra subsidiary inks 8 new SS supply contracts

Terra Nostra Resources Corporation a majority owner of two joint venture companies in the copper and stainless steel industries in China announced the signing of eight new contracts with new and existing customers for monthly production of over 2100 tonnes of stainless steel billets per month. These contracts are valued at over USD 7.million per month and include 500 tonnes of continuous cast 310S premium grade stainless steel.

Mr Sun Liu James Po CEO of Terra Nostra’s said “As part of its continuous quality enhancement programs, Shandong Quanxin Stainless Steel recently completed several technological and operational improvements. We now have both the ability to produce additional grades of high quality stainless steel and to increase overall production. He said these orders for continuous cast stainless steel billets move us another step closer to our goal of increasing profitability by expanding our mix of higher margin, higher value grades. He added that with our continuous casting capability, we have a distinct advantage over other domestic producers and are well positioned to meet the continuing strong demand for high quality grades of stainless steel that has until now generally been met by imports.”

Terra Nostra is a leading copper and stainless steel producer in China through its 51% majority interests in two joint venture companies in China. Shandong Terra Nostra Jinpeng Metallurgical Co Ltd has an existing and under construction total production capacity of 170,000 tonnes of electrolytic copper and 20,000 tonnes of low oxygen copper, together with value added copper rod and wire capabilities.

Chinese SS makers urged not to panic at drop in nickel prices

It is reported that nickel price closed at USD 29400 per tonne on the London Metal Exchange down by USD 3150. Chinese stainless market had slipped down on the nickel's change and presented mixed quotations in Chinese marketplace.

Mysteel analyst yet predicted there would be a rebound soon, a limited one and suggested stainless steel producers not to panic. The analyst said this nickel price drop is mainly psychologically boosted, while the stainless steel market will still hinge on downstream demand.

(Sourced from MySteel.net)

Handan steel maintains EXW prices

It is reported that Handan Steel latest EXW prices for some products. Prices are kept flat with those released on March 8th 2008.

Wire Rod, Rebar and Round Bar: unchanged.
Q235 6.5mm common carbon wire rod is quoted at CNY 5050 per tonne
Q235 6.5mm high speed wire rod is quoted at CNY 5090 per tonne HRB335 12mm rebar is quoted at CNY 5370 per tonne
HRB335 14mm rebar is quoted at CNY 5320 per tonne
HRB335 16mm to 25mm rebar is quoted at CNY 5170 per tonne
Q235 16mm to 25 mm round bars is quoted at CNY 5210 per tonne.

Medium Plate: unchanged.
Latest EXW price for Q235B 20mm medium plate stands at CNY 5950 per tonne.

Ship-building Plate: unchanged; CNY 50 per tonne higher for those with thickness of 50mm or more.
CCSA20mm ship-building plate is offered at CNY 6195 per tonne.

Prices listed above are inclusive of 17% VAT is effective as of March 18th 2008.

(Sourced from MySteel.net)

Yunnan Group gains 12 years lead mining rights in Australia

It is reported that Yunnan Metallurgical Group has gained 10% stock right of Aiweinie Company using USD 18 million which stands for it obtained 12 years mining right of Australia mine lead concentrate. At present, this project has been approved by the Ministry of Commerce and Administration Department of Foreign Exchange.

The responsible people from Yunnan Commerce Department disclosed on March 18th that it is the first time for Yunnan province to acquire mining right through transnational mergers. Yunnan Metallurgical Group and Aiweinie Company have negotiated for two years, and finally signed “strategic cooperation agreement” and “lead concentrate procurement agreement.”

As per report, Yunnan Metallurgical Group will import nearly 35,000 tons lead concentrate valuing 90 million US dollars every year. At present, the actual abroad investment of Yunnan province is NO.1 in western china. After Yunnan Tin Group invested in the construction of tin and mines in Singapore, Australia, Indonesia, Yunnan Copper Group invested in copper industry in the Middle of Africa, Yunnan Metallurgical Group also has taken an important step in overseas industrial layout.

Evraz calls off Yuzhkuzbassugol and Raspadskaya merger

Evraz Group SA announced that it has decided to terminate the merger negotiations between Yuzhkuzbassugol a fully owned coal mining subsidiary of Evraz and Raspadskaya, Russia's second largest coking coal producer, originally announced in June 2007.

It said that “Evraz believes that the proposed merger is not in the best interests of the Group’s shareholders at this time. Due to the favorable market conditions and recent developments at the Group, which include acquisition of selected production assets in Ukraine, we concluded that further integrating Yuzhkuzbassugol with Evraz’s steel operations and with Ukrainian coke production assets would yield more immediate value and long-term synergies than combining Yuzhkuzbassugol and Raspadskaya businesses.”

Mr Alexander Frolov CEO & Chairman of Evraz’s said “Yuzhkuzbassugol and Raspadskaya will provide more value for our shareholders as separate businesses. Yuzhkuzbassugol has already become an important part of our vertically integrated business model. We at Evraz are committed to grow both parts of Yuzhkuzbassugol businesses metallurgical coal and steam coal mines, capitalizing on the significant potential of the company’s existing mines, as well as the new deposits. It is equally important for us that Raspadskaya will remain Evraz’s strategic partner and a reliable supplier of coal to the Group’s mills in Russia.”

Evraz also announced that Mr Gennady Kozovoy has resigned as Yuzhkuzbassugol’s CEO. Mr Andrey Borschevich will become the new acting CEO of Yuzhkuzbassugol, effective March 20th 2008. Mr Borschevich previously worked as Chief Production Officer at Yuzhkuzbassugol and has 25 years of experience in the coal industry.

Mr Frolov said “We express our sincere gratitude to Mr Gennady Kozovoy for his contributions to Yuzhkuzbassugol. In particular, we would like to thank Gennady for implementing strict occupational health and safety standards at our coal mines.”

BMZ to start building flat product mill in 2009

Interfax reported that the state owned Byelorussian Steel Works from the Gomel region in Belarus plans to start building a sheet mill capable of producing 1 million tonnes of flat products per year in 2009.

Mr Ivan Demidovich first deputy industry minister of Byelorussia told reporters that "BMZ management has said it plans to start building the sheet mill in 2009.”

Mr Demidovich said that BMZ is considering equipment supplies for the new mill from the United States, Japan and Europe. He said "We are looking at this very seriously as we do not have the necessary technology.”

BMZ, built in 1984, makes cast billets and long products. Its exports account for around 85% of the plant's sales, with over 70% of exports going to countries outside the CIS.

Inprom to develop welded sections, beams and U-sections

Inprom intends to enter the market of welded sections, beams and U-sections by investing over USD 130 million into the projects.

Inprom Company will implement its plan by purchasing the existing enterprises and developing own production. In 2008 to 2010, Inprom will purchase 7 to 8 plants making welded sections in the European part of Russia, in the Ural and Siberia.

Inprom also plans to build a new plant making welded beams and U-section in six Russian regions in the cities where the Company has large branches. Financing will be formed of borrowed funds and the funds that Inprom hopes to attract at IPO.

Belarus considering setting up steel production abroad

Mr Ivan Demidovich first deputy minister of Belarus at the international specialized exhibition “Machinery Construction 2008” that opened March 18th 2008 said