RINL inks MoU with ministry of steel for 2008-09

Rashtriya Ispat Nigam Limited has signed a MOU with ministry of steel for the year 2008-09. Mr RS Pandey secretary steel and Mr PK Bishnoi CMD of RINL signed the MoU on March 19th 2008.

The MOU contains five parts
1. Vision
2. Mission
3. Objectives of RINL
4. Exercise of enhanced autonomy and delegation of financial powers
5. Performance evaluation parameters and targets, commitments and assistance from the government and action Plan for implementation and monitoring of the MOU.

As per the MOU, RINL DURING 2008-09 commits to produce
1. 3.95 million tonnes of hot metal
2. 3.45 million tonnes of liquid steel
3. 3.08 million tonnes of saleable steel

The MoU also incorporates milestones in respect of expansion of the plant capacity, coke oven battery 4, pulverized coal injection and air separation plant, involving an expenditure of INR 2580 crores. Parameters like marketing distribution network, customer satisfaction index and expenditure on corporate social responsibility have also been incorporated. Techno economic parameters like specific energy consumption, specific water consumption, BF productivity, LD converter productivity, labor productivity, etc., which indicate the efficiency of operations, have been included as specific parameters in the performance evaluation criteria of MOU.

Indian builders seek steel regulatory authority

The Hindu reported that anguished over the debilitating impact of the spurt in steel prices on the construction industry, builders have urged the union government to set up a steel regulatory authority to arrest such steep price rise in future.

Mr K Sriram president of the Builders’ Association of India addressing a press conference in Mysore said that the Government could not shrug its hands off the abnormal increase in the price of steel, which was attributed to an unholy cartel of steel manufacturers.

He said that the prices of steel, which were hovering around INR 30,000 a tonne two months ago had crossed INR 50,000 a tonne, causing concern among the builders.

He added that “The steep hike in steel prices has virtually brought vital infrastructure projects to a grinding halt. This development will lead to large scale unemployment and eventually to social problems.”

Mr Sriram said that the Government should intervene to break the cartel of steel manufacturers and immediately take steps to set up a Steel Regulatory Authority of India on the lines of Telecom Regulatory Authority of India, to regulate prices of steel in future. He added that “If these measures are not taken immediately, the construction sector along with the industrial sector will be forced to stop all work till the issue is resolved.”

ArcelorMittal proposes alliance with CIL for abandoned mines

The Hindu reported that ArcelorMittal is keen on entering coal mining sector in India and has sent a letter to the coal ministry stating its intent on tying up with the coal major Coal India Ltd.

The news was confirmed to The Hindu by a senior official in the coal ministry. He said that “We have received a letter from the group which is keen on participating in a joint venture on abandoned coal mines of CIL.” He added that the comments of CIL have been sought on the matter.”

Mr PS Bhattacharyya chairman of CIL refused to comment on this matter.

But as per the report, the issue of abandoned mines was discussed at a meeting of the research and development apex committee of CIL, held at the corporate headquarters earlier this week. Sources said that a study was now being done by CIL to find out the number of coal mines and also the reserves that they carry of thermal coal or coking coal.

CIL seeks prompt clearances to meet production target

PTI reported that Coal India Limited, which has set a production target of 405 million tonne in 2008-09, might fail to achieve the target if it did not get land and prompt forest clearance required for undertaking expansion projects.

Mr PS Bhattacharya chairman of CIL said that "Coal India Limited has to produce 25 million tonne additional coal in the next fiscal compared to 2007-08. It is a tough target. If we do not get land and prompt forest clearance for different expansion projects, we may experience a major shortfall."

Mr Bhattacharya said that out of the 25 million tonne additional production in 2008-09, around 21 million tonne was scheduled from Mahanadi Coalfields, Eastern Coalfields Limited and Central Coalfields Limited.

He said that the expansion projects, which required immediate clearances, include Ashoka, Karo and Konar besides new projects like Hura and Chuparvita, all under Central Coalfields Limited in Jharkhand. He added that "We are trying hard to get quick clearance, but everything is not in our hand. We have also sought a very high level meeting to tide over the problem."

Turning to the current fiscal, he said that CIL would face minor shortfall in production during 2007-08. Against the target of 384 million tonne, it would end this fiscal with a production of 380 million tonne.

AP MP calls for declaring cement and steel as essential commodities

It is reported that Mr K Yerrannaidu Telugu Desam Party leader and member of parliament, in a letter to Dr Manmohan Singh PM Of India, has asked to include cement and steel in the list of essential commodities so that their prices can be regulated.

Mr K Yerrannaidu has also suggested the constitution of a body, on the lines of the Telecom Regulatory Authority of India, to regulate the prices of steel and cement.

He said “These two items are crucial for the poor man and also affect industrialization and construction of major projects, which are totally dependent on steel and cement.”

Mr K Yerrannaidu said from December 2007 to March 15th 2008 the price of steel had increased by 30%, the cost overruns halting several projects. Housing projects meant for the people were also hit. He said on the export policy “The government gives permits to private people to export iron ores to other countries but not to public undertakings.”

Mumbai Port to develop coal loading terminal at Haji Bunder

Exim News Service has reported that Mumbai Port Trust plans to sign an agreement soon with the Central Railway to develop a special terminal at Haji Bunder for loading imported coal. The new road and rail links would ensure that the traffic to and from the port did not affect traffic within the city.

Mumbai Port Trust official said Mumbai Port Trust has offered around 17.8 acres of land at Haji Bunder to the Railways for constructing the terminal. The official elaborated that the port is planning major expansion program to develop better road and rail infrastructure.

The report added that Mumbai Port Trust had sought the necessary infrastructure from the Railways to directly load up to 4 million tonnes of imported coal on to rail wagons.

At present, Mumbai Port Trust operates on the railway line connected to the main broad gauge lines of the Central and Western Railways at their interchange railway yard at Wadala. The port authorities’ decision follows the government announcement of the “Own Your Rake” or “Own Your Wagon” scheme.

TN urges centre to allow using forest land for iron ore projects

It is reported that Tamil Nadu forest department has sent a proposal to union ministry of environment & forests for clearing a natural forest to take up an iron ore mining project in Salem.

A letter sent from the state environment & forest secretary said that a proposal under the section 2 of Forest Conservation Act, 1980 for diversion of forest land over an extent of 638 hectare in Kanjamalai reserve forest of Salem forest division, Shervoroys range in Salem district for an iron ore project by Tamil Nadu Iron Ore Mining Corporation Limited.

The district forest officer of Salem had inspected the proposed area and identified the proposed mining area to an extent of 638 hectare. The user agency had identified an area of 1,928.440 hectare in Ramanathapuram, Sivaganga and Tirunelveli districts from which compensatory afforestation land of 1,276 hectare could be taken away by forest department.

Tamil Nadu Iron Ore Mining Corporation Limited submitted a proposal in which the company agreed to pay the amount for net present value to be fixed by forest department, to give compensatory a forestation land as required by the forest department, to pay the amount fixed for the exploitation of trees likely to be felled and the lease rent amount to be fixed by the department.

Industries to pay 33% more for power in Uttarakhand

BS reported that the Uttarakhand Electricity Regulatory Commission has increased the new power tariffs applied on various industries in the state by 10% to 33%.

For low tension industrial consumers, the commission has nominally increased the tariff by 10% to 12% considering the increase in average cost of supply and inflation. Under the revised tariff approved by the commission for LT industrial consumers, the charges would be INR 2.75 per unit instead of the existing rate of INR 2.45 per unit. The fixed charge has also been increased to INR 70 per KW per month in place of the existing charge of INR 60 per KW.

High Tension industry consumers with load factor up to 33% shall pay the energy charge of INR 2.20 per KVAh. Those with load factor above 33% and up to 50% shall pay INR 2.40 per KVAh and those above 50% shall pay INR 2.65 per KVAh. Demand charges have been staggered on the basis of the size of the industries. HT industries with load up to 1000 KVA shall pay demand charges of INR 150 per KVA per month and those above this load shall pay INR 200 per KVA per month.

An official of UERC said though the steel industry has been given some relief which has been clubbed with HT industry. This means the hike imposed on the steel industry in the past now stands cancelled. He said “A separate category of steel unit has now been done away with and from now on, there is only one category of HT industries.”

New office bearers elected for CII Orissa

SNS reported that Mr SK Mohapatra and Mr SS Nandurdikar have been elected as the chairman and vice chairman of CII Orissa state council respectively for the year 2008-09 in the first reconstituted state council.

Mr Mohapatra is the CEO of Dhamra port company limited. An IAS officer of Gujarat cadre, he has served as industries secretary and as the CEO of GIDB Gujarat, chairman of Paradeep Port Trust and MD of Sardar Sarovar Nigam.

Mr Nandurdikar, an alumnus of IIT, Powai and Bajaj Institute of Management is presently working as MD of Paradeep Phosphates Limited.

L&T to start work on mega shipyard at Ennore soon

BL reported that Larsen & Toubro hopes to shortly begin work on the integrated shipbuilding yard and port at Ennore, north of Chennai. Its proposal for this project got the Tamil Nadu Government’s approval in January 2008 and the company is now discussing the agreement it will sign with the Government for the project.

The project’s cost has been estimated at INR 3,060 crore with the equity component being put at INR 1,100 crore. The Tamil Nadu Industrial Development Corporation, a State Government industrial promotion agency will hold a 3% equity stake in the venture.

According to the sources the process of earmarking the 1,200 acres of land for the project is on and once that is finished construction work will start. The project is expected to take 24 months for completion.

L&T plans to build large sized ships, including very large crude carriers at the shipbuilding yard. It is expected that the company will also make vessels for defense purposes.

L&T already has a ship building facility at Hazira in Gujarat and was looking to construct a Greenfield facility because the ship building business is booming.

HSL revival proposal under consideration

Mr TR Baalu minister of shipping, road transport and highways in a written reply in the Rajya Sabha informed that a proposal for Rehabilitation cum Financial Restructuring of Hindustan Shipyard Limited is under consideration of the Government.

He said a Group of Ministers constituted in this regard has considered it and made certain recommendations. The recommendations of the GoM shall be placed before the Cabinet Committee on Economic Affairs for consideration and approval.

MP negotiating PPA with Reliance Energy and Essar Power

It is reported that Madhya Pradesh government is in talks Reliance Energy and Essar Power for power purchase agreements to augment power generation. The report said the companies will supply nearly 1,400 Mw. These companies will supply power after four years for 25 years.

Mr Sanjay Bandopadhyay energy secretary said “We are negotiating with Reliance and Essar and we expect to purchase power at as low as INR 2.40 to INR 2.45 per unit. We had floated tenders for purchasing 2,000 Mw. Lanco has committed to supply 600 MW at INR 2.34 per unit.”

He added that “Reliance has offered power at INR 2.70 per unit, while Essar has offered at INR 2.94 to INR 3.04 per unit. He also said we are purchasing 450 Mw at INR 9.50 per unit from Gujarat, which is costly.”

MP has already inked a deal with the Lanco group for purchasing 600 Mw. Lanco has issued a letter of intent to supply power at INR 2.34 per unit from its Orissa project.

Madhya Pradesh is facing a shortage of 1,100 MW when peak demand reaches 6,271 MW against the supply of 5,110 MW. Three units of the state, namely the Sanjay Gandhi Thermal Power station of 500 MW, the Amarkantak station of 210 MW and the Satpura thermal power station of 210 Mw went out of order due to technical problems.

Performance awards for 21 power utilities

Indian government has presented 21 power utilities with national awards for meritorious performance during the year 2006-07.

NTPC received four awards for the performance of its Simahdri, Talcher and Kaniha, Korba and Vindhyachal power stations. Three projects of PGCIL and two of Andhra Pradesh Power Generation Corp were also presented with the national awards for Meritorious Performance in 2006-07. TATA Power, Reliance Energy, JSW Energy and Torrent Power and electricity utility of Tamil Nadu were also among the companies awarded.

Mr Sushilkumar Shinde union power minister, while presenting the awards, said that "There has been improvement in all fields of the power sector. However, due to the increasing demand of energy, India is still facing energy shortage of 9.5% and peak demand shortage of 15.8%."

India promoting wind power projects in a big way

Mr Vilas Muttemwar union minister of state for new & renewable energy said that centre has promoted setting up of commercial wind power projects in India by providing incentives such as concessional import duty for wind electricity generator sub systems, excise duty exemption, ten years tax holiday on wind power projects, benefit of accelerated depreciation, term loan from Indian Renewable Energy Development Agency and identification of more potential locations by carrying out wind resource assessment studies.

Mr Muttemwar said that, this apart, preferential tariff and grid evacuation facilities are provided for wind power in Tamil Nadu. A wind power installed capacity of 7844 MW has been achieved up to December 31st 2007, which includes 3712 MW in Tamil Nadu.

He further added that a capacity addition of 10,500 MW from wind power has been planned in India during the 11th Plan period. Tamil Nadu has planned a target of 2,500 MW from wind power during the 11th Plan period. An outlay of INR 75 crore has been proposed during the 11th Plan to support wind resource assessment and demonstration projects in various states in India.

MAN Force sees Jharkhand as a good market for its trucks

FE reported that MAN Force Trucks Private Limited, which recently appointed Narbheram Motors as its authorized dealer for Jharkhand and Bihar, sees a good future for its heavy commercial vehicles in Jharkhand. MAN Force, which is currently manufacturing heavy commercial vehicles of 25 tonne to 50 tonne carrying capacity, has recently introduced its 25 tonne truck that was yet to hit Jharkhand roads even though a small number has already been sold in West Bengal.

Mr Jay Parekh MD of Narbheram Motors said that "The entire segment of heavy commercial vehicles owners is moving to heavier commercial vehicles by way of replacing their old fleet. I see a good future for the MAN trucks in the Jharkhand mining sector in the coming years, particularly once the state had unveiled its rehabilitation and resettlement policy."

He added that likewise, fleet owners were also increasing their profitability by replacing their old fleet in the mining area by higher capacity heavy commercial vehicles. Here, two MAN tractor models, the 49-tonne CLA 49.280 and 40-tonne CLA 40.280, were making a good impact. The tractor models were being used for applications ranging from long haul carrying of perishable goods in reefers and containers and short or medium haul of raw materials such as coal, iron ore, aggregates, loose cement and limestone.

According to Mr Parekh, Narbheram Motors intends to sell around 500 MAN Force vehicles during 2008-09. Priced at INR 2.85 million for the 14 cubic meter Rock body model and INR 2.67 million for the 16 cubic meter box body model, the tippers are being used mainly in carrying out mining operations in Jharkhand. He said that "The payload capacity of the MAN tippers being higher than other models available in that price range, profitability for the fleet owners has gone up."

MAN Force, that had produced around 5,000 heavy commercial vehicles in 2006-07, is likely to end the current year by producing around 24,000 vehicles, of which half of them will have been exported by it. The heavy commercial vehicles manufacturer exported its first consignment of around 2,500-3,000 vehicles around three months to Bangladesh, Dubai, Saudi Arabia and to other ASEAN countries.

APTransco to invest INR 4,498 crore

BL reported that Transmission Corporation of Andhra Pradesh is poised to invest about INR 4,498 crore in improving the transmission system during the XI Plan period of 2007-2008 to 2011-2012.

According to Ms Rachel Chatterjee chairperson and MD of APTransco said the distribution companies have proposed to invest INR 5,848 crore in the Plan period for various expansion projects. She said she is happy over APTransco receiving award for Best Transmission System for 2006 to 2007 from Mr Sushil Kumar Shinde Union Power Minister of India.

She added that “With increased investments and better management practices, the overall capacity has been stepped up and this ensures supply of quality power to the last mile.”

The report added that Transco is in the process of establishing thermo vision cameras to detect hotspots on the transmission lines and connecting links to various equipment in the sub station and this enables experts to attend to the defects on live line without shutting down the system.

APTransco said it is the first transmission utility in the country to implement the Enterprise Resource Planning package aimed at improving the operational and managerial efficiencies. This will regulate the financial and material management process of the organization and help in timely tracking of the materials allocated and payments made.

4 SEZs to come up in Tamil Nadu

BS reported that under the Budget proposals for 2008 to 2009, the Tamil Nadu government will establish four special economic zones in the industrially backward areas of the state.

Mr Anbazhagan finance minister of Tamil Nadu said the four special economic zones are
1. Specialized SEZ for transport engineering goods will be set up on 255 acres at Gangaikondan in Tirunelveli district.
2. SEZ will come up on 255 acres at Cheyyar in Tiruvannamalai district and roll out spare parts for the automobile industry.
3. SEZ spread over 263 acres at Perunthurai in Erode district, will specialize in engineering goods.
4. Leather goods SEZ on 260 acres will be set up at Ranipet in Vellore district.

So far, 32 SEZs have been approved in Tamil Nadu and 29 of these have been notified by the Centre.

MALCO eyeing INR 300 crore CAPEX plan

BS reported that Madras Aluminum Company Limited is embarking on an INR 300 crore expansion and modernization plan at Methur Dam in Salem district of Tamil Nadu.

Mr Suresh Rathi CEO of Madras Aluminum said that the expansion and modernization would comprise three components. He added that "It would add a power generation unit with a 25 MW capacity to the existing 75 MW power plant at the MALCO complex. The new pant would commence power generation by December 2008."

Mr Rathi said that as part of the second component, MALCO would enhance the alumina production capacity to 120,000 tonne, from the present 85,000 tonne a year. This expansion will crystallize by early next fiscal. He added that "Besides, it will step up the metal production capacity to 65,000 tonne a year, from the existing 40,000 tonne within the next 10 months."

Established in 1965, MALCO is the only integrated primary aluminum metal complex in south India. It has already identified new mines in the captive area of Kiolli, Yercaud and Poondi Hills in Tamil Nadu to excavate more bauxite deposits.

Of the 3,300 tonnes of wire rods that MALCO manufactures in a month, about 500 tonne are exported to countries like Canada, Sri Lanka and West Asia. It registered an INR 535 crore turnover during July 2006 to March 2007 period and expects to close the current financial year with INR 500 crore.

BHPB bid for Rio – Rio invites Chinese partners

It is reported that Rio Tinto would like to work with Chinese state firms to develop mining projects around the world.

Mr Tom Albanese CEO of Rio Tinto while speaking to reporters in Beijing said that Rio Tinto is without peer in discovering world class mineral deposits but these were expensive to exploit and required significant infrastructure investment.

Mr Albanese told that "There are opportunities for cooperation on a joint venture basis, or something equivalent to that and I think that Chinese state owned enterprises could be very much part of that picture.”

He told that Chinese state owned enterprises could be useful in providing capital, engineering and technology for projects in Asia, Africa and South America.

He added that "I would not say that we have any active engagement under way in that area. But this is something I have a personal interest in pursuing.”

Chinese state owned aluminum group Chinalco complicated BHPB’s bid for Rio last month by teaming up with Alcoa Inc to buy 9% of Rio for USD 14 billion.

Rio Tinto already has a joint venture with Baosteel Group Corp in Western Australia State and is a partner with Sinosteel Corp in the Channar project also in North Western Australia.

Japan seeks higher HRPO import quotas in Thailand

Bangkok Post reported that Japanese exporters asked the Thai government to more than triple the import quota for steel products for this year saying that domestic demand is far higher than the amount allowed.

Mr Mitsuhiro Sonada, the president of the Japanese Chamber of Commerce said that members recommended lifting the quota for pickled and oiled steel products to 730,000 tonnes from the 227,500 tonnes allowed under the free trade agreement between Thailand and Japan.

Mr Suwit Khunkitti industry minister of Thailand said that the government would review steel market conditions before this year's quota takes effect in July.

Steel was a highly contentious issue during the negotiation leading up to the signing of the Japan Thai Economic Partnership Agreement in last November. Local steel producers asked the government to help protect them by forcing Japanese manufacturing plants in Thailand to use local content instead of allowing them to import their own products freely. The Japanese side countered that certain types of high quality steel required by big Japanese invested automobile and electrical goods makers were not made in Thailand.

US DOC makes final ruling on AD of plates from South Korea

US Department of Commerce, which on November 23rd 2007 published the preliminary results of the administrative review of the antidumping duty order on certain cut to length carbon quality steel plate products from the Republic of Korea, on the basis of analysis of the comments received and an examination of calculations, has made changes for the final results.

The final weighted average dumping margins for the period February 1st 2006 to January 31st 2007 are listed below

The products covered by the antidumping duty order are certain hot rolled carbon quality steel as under
1. Universal mill plates (Flat rolled products rolled on four faces or in a closed box pass, of a width exceeding 150 mm but not exceeding 1250 mm and of a nominal or actual thickness of not less than 4 mm, which are cut to length (not in coils) and without patterns in relief, of iron or non alloy quality steel
2. Flat rolled products, hot rolled, of a nominal or actual thickness of 4.75 mm or more and of a width which exceeds 150 mm and measures at least twice the thickness and which are cut to length (not in coils).

Steel products that meet the noted physical characteristics that are painted, varnished, or coated with plastic or other non-metallic substances are included within this scope. Also, specifically included in the scope of the order are high strength low alloy steels.

Canadian coking coal producers win 130% interim increase – Report

The Age without citing anyone reported that Canadian producers of coking coal, used to make steel, have won a 130% interim price increase from steelmakers.

The paper said that coking coal will be sold at USD 225 a ton up from USD 98 a ton for the year beginning April 1st as the price for pulverized coal increased to USD 190 a ton from between USD 65 and USD 70 a ton.

According to the newspaper, provisional price settlements are agreed by smaller producers when there is no benchmark agreed by bigger producers and steelmakers. It said that the price will be changed to the benchmark price once one is agreed.

Japanese auto majors urge changes in steel price talks

Mr Fujio Cho chairman of Japan Automobile Manufacturer Association have urged changes in negotiations with steelmakers for prices of steel sheets used for cars which are traditionally decided once a year in spring by Automobile manufacturers and steelmakers.

Mr Cho said this negotiation style is not suitable in the changed market environment. He said that "This year, we will continue to have the once a year negotiation with steelmakers and we don't have any proposal for an alternative price talk scheme.”

Mr Cho said that "The previous economic principles based on supply and demand are not working. Fund money going into the market, a few suppliers having monopolistic control over iron ore prices are moving based on a different set of dynamic.”

He said that he does not see steelmakers as negotiators on the other side of the table, but partners. He said that "There is no simple solution. In that sense, steelmakers should not be seen as negotiators on the other side. Steelmakers and automakers are on the same boat. We should talk issues together.”

He, however, added that he would like to suggest to Toyota Motor to change its way of procuring materials.

Algoma reports USD 17.5 million profit in 2007

Algoma Steel Inc has declared its fifth consecutive year end profit, but a modest one as compared to the preceding three monster years of profitability. For the October to December 2007 period the company announced a net income of USD 21.3 million, bringing 12 month profit to USD 17.5 million. That's down more than USD 200 million from 2006.

It comes after an unprecedented run of profitability, USD 344 million in 2004, followed by USD 240 million in 2005 and USD 222 million in 2006. Algoma Acquisition Corp, a subsidiary of India's Essar Steel Holdings Ltd acquired Algoma in a USD 1.89 billion cash takeover early last summer.

Officials at ASI stress financial information of the new and old companies may not be comparable as a result of a revaluation of assets and liabilities to fair market value at the date of acquisition.

Official said that the year end numbers were influenced by No 7 blast furnace, the company's lone operational blast furnace, being out of service for nearly two thirds of the third quarter, 52 of 92 days, three weeks longer than expected for a scheduled reline. That meant no liquid iron was available throughout the steelworks.

It says that the company lost USD 30.8 million in Q3, its first red ink in nearly four years. It further added that another contributor to a weaker bottom line was USD 23.6 million in change of ownership transaction costs.

Official said that Q4 numbers include USD 514.8 million worth of sales, the best three month financial performance of 2007 and 759,000 tons of shipments, the highest quarterly shipment tonnage in at least two years.

ArcelorMittal closes Noble International deal

It is reported that ArcelorMittal now owns a 56% stake in automotive parts supplier Noble International Ltd following completion of a USD 50 million debt financing deal.

ArcelorMittal in a regulatory filing said that the investment was made in the form of five year convertible notes, with a 6% annual interest rate. The notes have an initial share conversion price of USD 15.75.

ArcelorMittal, Noble's largest supplier customer and shareholder, agreed earlier this month to provide the debt financing to the Warren, Michigan based company and buy out chairman Mr Robert J Skandalaris' stake. According to the filing with the Securities and Exchange Commission, ArcelorMittal now beneficially owns about 15 million Noble shares, which includes the shares bought from Skandalaris and the conversion shares.

Mr Thomas L Saeli CEO of Noble said that "We believe this cash infusion will put our North American covenant issues behind us and allow management to focus all of its attention on integrating our recent acquisitions and running the business.”

FDS seeking partner for its coke plant in US

It is reported FDS, whose USD 920 million new coking plant soon to be built along the Maumee River near Otter Creek Road of Oregon in Ohio State of US is working on an agreement in principle with another industrial company to take over a major portion of the project.

As per report, FDS has secured the permit for that coking plant and needs a partner experienced in the steel and coking business to take over development and invest money.

Mr Matt Sapara Matt Sapara the development director of TLCPA said that FDS is in the final stages with one company that offers more than money for this project.

He said that "But you also want someone with a strong environmental track record, you want someone with experience in dealing with this facility and someone who has contacts in the steel industry. Those are all significant, and they think they found that partner."

He added that an announcement on this new partner could come tomorrow or early next week.

The FDS Coke Plant is designed to charge of total of 2.058 million tons of coal and produce approximately 1.4 million tons of coke. The plant’s coke oven batteries will be located on a southwest to northeast line within approximately 100 feet of the eastern property line of the Project Site. Coke oven waste gases generated by the coking process are routed to refractory lined tunnels for complete combustion and generation of excess waste heat. Heat recovery steam generators are then used to cool the gases by producing steam. After the HRSGs, the cooled gases are ducted to air pollution controls prior to discharge into the ambient air.

Konecranes buys Spanish service firm

It is reported that Konecranes has acquired the entire share capital of Spanish crane and service company Eydimen 2000 SL based in San Sebastian in Northern Spain. The shares were acquired from the company's management, who will continue in the company. The value of the acquisition is not disclosed.

The company, which has 15 employees, will be named Konecranes Gruas SL

Prior to this transaction, Konecranes held 19.2% of the share capital in Eydimen, which has been selling Konecranes branded industrial cranes in Spain since 2005.

Eskom warns South African miners of power cuts

Reuters reported that South African state owned power utility Eskom has warned that it may cut power supply to the country's mines again, if it is affected by power generator failure.

According to Reuters, this latest warning follows a tightening power supply situation in South Africa with rolling blackouts and the subsequent five day closure of the country's mines in early 2008.

Reuters noted that Eskom cut power supply to the country's mines on January 25th 2008, after it registered a 4,000MW deficit in supply, which threatened to undermine the entire country's electricity grid.

Eskom, which claims to generate 95% of South Africa's and 45% of Africa's electricity, has a total generating capacity of 37,761MW from its 11 coal fired power stations. According to the news source it has a further 2,300MW of potential capacity from two idle plants, which are reportedly in the process of being re commissioned. Statistics in the Eskom annual report suggest that the mining and industrial sectors collectively use 66% of total Eskom electricity, followed by residential 18%, commercial 10% farming 3.5% and transport 1.6%.

Worthington Q3 net sales up by 7% YoY

Worthington Industries Inc announced results for the Q3 and nine month periods ended February 2008. For the Q3 of fiscal 2008, net sales were USD 725.7 million up by 7% YoY from USD 677.3 million. Third quarter net earnings were USD 18.3 million as compared to USD 5.5 million.

Net earnings for the third quarter included USD 2.6 million in pre tax restructuring charges, USD 1.4 million of which was non cash, primarily related to previously announced plant closures in the Metal Framing segment.

For the nine month period, net sales of USD 2,198.3 million up by 1% YoY than USD 2,185.2 million for the same period last year. Net earnings were USD 53.2 million as compared to USD 75.7 million for the same period last year. YTD results were negatively impacted by USD 9.9 million in pre tax restructuring charges.

Mr John McConnell chairman & CEO of Worthington Industries said that “Our performance this quarter showed significant improvement. Pressure Cylinders and our WAVE joint venture, which posted a record third quarter, continued producing excellent results. Metal Framing made great strides as efforts to reduce cost and improve customer service are beginning to net results.”

He added that “The entire team has pulled together to help this segment successfully implement its turnaround plan. Steel Processing has also done an excellent job of increasing volumes and market share to help offset the weakness in the automotive sector.”

Guinea becomes new focus for iron ore mining

It is reported that currently, more and more companies have invested in the mining programs in Guinea, as the price of iron ore has increased rapidly.

Guinea is a country with major iron ore mineral resources in the world. Some countries already got the licenses to explore and mine iron ore in Guinea.

As the improvement of the invest conditions, China also starts the mining programs actively in Guinea.

(Sourced from YIEH.com)

Japanese exports of GI in January totals 402,405 tonnes

Japan exported 402,405 tonnes of galvanized sheets in January 2008. The export price on average was at FOB USD 784 per tonne.

The export to China totaled 145,788 tonnes and the price was averaged at USD 801.1 per tonne FOB.

Besides, the export to South Korea, Taiwan and America were at 24,494 tonnes, 16,269 tonnes and 3,861 tonnes respectively. The export prices to these three areas were at USD 752.3 per tonne, USD 722.5 per tonne and USD 877.5 per tonne FOB respectively.

(Sourced from YIEH.com)

South African coal output improving after heavy rains

Mining Weekly reported that some of South African Eskom's biggest coal suppliers said that their production is improving after heavy rains this week.

Mr Bronwyn Wilkinson a spokesperson of BHP Billiton said that "It is still difficult with the wet conditions, but the situation is improving.” Meanwhile, Eskom's biggest coal provider, Exxaro Resources, said that the rain had only affected its deliveries minimally.

Mr Trevor Arran a spokesperson said that "Heavy rainfall in Mpumalanga has fortunately not affected the two big Eskom base load suppliers, Matla and Arnot, which are both underground mines.” He added that there was "not that much rain" at its Grootegeluk opencast mine near Lephalale, which supplies the Matimba power station.

Mr Arran stated that "We have, as per planned, sizeable stockpiles at most of our operations in case of further, persistent rain.”

Mr Pranill Ramchander AngloCoal spokesperson said that "only some opencast mines were affected and they were certainly not all shut down.” He said that "With rainfall this is not unusual for it to affect opencast operations.” He added that there was unnecessary hype created.

Eskom, which uses coal to produce some 93% of its power said that it struggles to burn wet fuel and that it is difficult to handle wet coal. It has been load shedding since Monday.

Bangladesh to finalize coal policy soon - Report

Energy Bangla reported that the government of Bangladesh will finalize the coal policy soon, as the energy and power sector is set to expedite decision making.

The report quoted Dr M Tamim special assistant to the chief adviser in charge of the energy, power and mineral resources ministry as saying that 80% of recommendations in the energy policy formulated in 1996 had not been implemented in the past 12 years. He said that "Institutional strengthening and financial assistance are a must to make things happen now.”

Mr Tamim said the 1968 Mining Act must be amended and the coal policy should be finalized as soon as possible. He said that "We have to maximize the use of foreign aid and technical assistance in the energy and power sector. We will have to generate 20,000 MW power by 2020 if we want to fulfill millennium development goals."

He said that decisions about all these issues must be taken without delay, he further added that with a warning that the huge subsidies for the energy sector had posed a serious burden on the government, which threatens to slow economic progress.

PPC to buy 0.8 million tonnes of coal from Maritza Iztok mines

Dnevnik daily report that Greek energy company PPC plans to buy 0.8 million tonnes of coal from Bulgaria's Maritza Iztok mines. The report quoted Mr Ivan Markov CEO of of Maritza Iztok mines as saying that the last batch will be shipped by the end of October this year.

According to Mr Markov talks on coal purchase have been ongoing for three months. PPC is interested in buying between 1 million tonnes and 2 million tonnes a year. The purchased coal will feed the company's power plants in northern Greece.

The Maritza Iztok mines have called for a 14.09% hike in the lignite coal. The hike could take place either in early April or early July 2008.

Poland to sell minority stakes in utilities by 2010 end

Thomson Financial reported that Poland is planning to sell minority stakes in the country's four biggest power companies PGE, Energa, Enea and Tauron by the end of 2010.

Mr Krzysztof Zuk deputy treasury minister in an interview told newspaper that Enea will sell new shares and float on the Warsaw stock exchange in 2008, followed by PGE, Poland's largest power producer, at the turn of this and next year. After that the state will sell stakes in the companies, but keep control over them.

Mr Zuk said that Energa and Tauron will float 'no earlier' than in the second half of next year and the sale of state's stake in both power producers could happen in 2010. He added that Polish coal miners including Katowicki Holding Weglowy, Jastrzebska Spolka Weglowa and Bogdanka will also float on the stock exchange next year.

Alabama coal shipments in 2008 fall by 3% YoY

According to the US Department of Energy, which tracks weekly sales, Alabama coal shipments so far in 2008 have fallen by 3% YoY.

As per the latest shipment report state's eight underground and dozens of surface mines shipped 393,000 tons last week that brings the 2008 total to 4.2 million tons down by 3% YoY.

Alabama mines historically produce about 20 million tons a year. Its 2007 production was 19.5 million tons, little changed from 19.3 million tons in 2006.

New coal import pier ready for Kinder Morgan

Daily Press reported that Kinder Morgan Energy Partners completed a USD 70 million expansion to its Pier IX coal terminal, including construction of a new pier that will be used primarily for handling coal imports. Kinder Morgan planned the expansion in 2006, at a time when the coal export business was on the tail end of a sharp decline.

Mr Joseph DeMatteo manager of Kinder Morgan said that the new dock, dubbed Pier X will allow the terminal to receive coal by barge or ship and increase its total throughput by about 3 million tonnes or about 30%.

Mr DeMatteo is confident the highly cyclical coal market will switch. And when it does, Pier X will be ready to act. He said that "We feel pretty good about it, because when the market does shift and it will we'll be sitting nicely.”

Coal shippers like Kinder Morgan and its adjacent competitor, Dominion Terminal Associates, laid plans to expand capabilities to handle imports, in part because of new federal environmental restrictions on power plants. But as worldwide demand for coal skyrocketed and the US dollar weakened against foreign currencies, the coal export market exploded, leaving the import market next to nonexistent. Analysts expect the hot export market to continue at least through the end of 2008, dampening the near term outlook for Kinder Morgan's new investment, which was set up primarily to capitalize on imports.

In 2009, Kinder Morgan expects to handle about 1 million tons of new import coal.

Sunborn to shift shipbuilding activities to Malaysia

The New Straits Times reported that as much as MYR 1.4 billion (USD 438.87 million) worth of contracts will be up for grabs for Malaysian firms as Finland's Sunborn International plans to move all its shipbuilding activities to Malaysia.

The paper quoted Mr Jari Niemi executive director for planning, development and shipbuilding of Sunborn at a briefing in Kuala Lumpur as saying that the company has plans to build at least four vessels to be turned into yacht hotels in Malaysia, spanning through 2014. He said that "We are now seeking collaboration with local businessmen to operate the shipbuilding activities in the country.”

He added that "We are also awaiting approvals from the ministry of finance and Malaysian Industrial Development Authority so that we can operate as a local company that makes us eligible to apply for the various tax incentives offered by the Malaysian government.”

Mr Niemi said that Sunborn International has established a subsidiary, Sunborn Marine Malaysia Sdn Bhd to supervise all its activities in the country. He added that "These include the ongoing Sunborn's third yacht hotel project costing between MYR 250 million (USD 78.37 million) and MYR 300 million (USD 94.04 million), which is expected to be delivered to its final destination in Spain by 2009.”

The Sunborn Group is a global hotel and hospitality company with over 30 years of experience in the hotel, spa and conference business in Scandinavia and Europe.

Miranda's coal projects near production

miningmx.com reported that South African miner Miranda Minerals will soon bring a 30,000 tonnes to 50,000 tonnes coal mine into production.

Mr Ron Nel CEO of Miranda told minigmx that it has six contiguous properties, with the first, Sesikhona awaiting a new order mining right to begin exploiting the 22 million tonne ore body in the eastern KwaZulu Natal province. He added that Sesikhona could produce up to 50,000 tonnes of coal a month, most of which will be exported. There is an upper seam, which lends itself to Eskom coal, but no talks have been held with the coal hungry power utility yet.

Miranda has five other properties near Sesikhona, which it will spend the next two months drilling and hopes to submit applications for mining rights to the Department of Minerals and Energy by the end of the first quarter, with the intention of securing those rights by the end of the year. In total, there is an estimated saleable reserve of 200 million tonnes of hard and soft coking coal.

Mr Nel said that “We believe coal transport will move back to the permit and rail system because the South African roads cannot take anymore trucks. We will lease three stations, put in sidings and blending plants because there’s a lot of money in blending and you can blend to Eskom specifications.”

KwaZulu Natal coal is of a very high quality, generally anthracite and which is largely exported.

PSM increase steel prices again - Report

Daily Times reported that Pakistan Steel Mills has again raised the prices of steel products once again by PKR 2,000 to PKR 8,000 per tonne in the local markets on Saturday.

According to the report in Daily Times, which cited some dealers, following are the recent changes announced by PSM

1. Billets by PKR 6,000 to PKR 7,000 per tonne on its various qualities and sizes to reach at maximum level of PKR 58,700 per tonne

2. The prices of steel slab are raised by PKR 2,000 to stand at PKR 54,800 per tonne

3. The prices of pig iron are increased by PKR 3,000 to reach at PKR 36,900 per tonne

4. The prices of galvanized rolled coil increased by PKR 3,500 to PKR 4,500 on its different sizes to stand at the maximum level of PKR 81,500 per tonne

5. The prices of the cold rolled coil have escalated by PKR 2,000 to reach at PKR 58,000 per tonne

6. Rebar price have surged by PKR 8,000 to reach at PKR 80,000 per tonne.

The PSM statement said that the recent increase in the products’ prices is mainly attributed to the substantial increase in the prices of basic raw materials such as iron ore, coke, coal and other materials. PSM has explained the escalation of prices on its steel products in line with the prices in international market, aiming to curb the black marketing, smuggling and other illegal trade activities.

Rebar prices in UAE surge to record levels – Report

Arabianbusiness.com reported that rebar prices in the UAE have shot up by 30% within a week and are expected to cross USD 1,150 per tonne next month.

As per report last week, rebar was selling for USD 980 in a steel futures contract expiring in the first week of April on the Dubai Gold and Commodities Exchange. There were no sellers for the May contract at that price, insinuating a further increase in the price of steel.

Mr Pankaj Gupta regional manager of brokerage firm SMC Comex which is trading on the DGCX said there are two reasons for this jump in prices.
1. Due to the cost of iron ore which went up by 65% recently and the other is due to Turkish steel producers constantly raising their prices every day.
2. Since most of the steel imported into the UAE is Turkish, it is causing a massive problem.

Mr Gupta added that "Producers were not selling for the past 15 days, and I do not think that steel suppliers are completely out of stock. But if you know that your steel is going to be worth almost twice as much in a week, any businessman would hold on to it and sell it when the time is right.”

Iran earns USD 70 billion from oil sales in 2007-08

RIA Novosti cited Mr Gholamhossein Nozari oil minister of Iran as saying that Iran grossed USD 70 billion from oil sales over the country's past solar year, which according to the Iranian calendar runs from March 21st 2007 until March 20th 2008.

Mr Nozari told national television that "Iran's income from the export of crude oil in the current Iranian year has been around USD 70 billion.”

Mr Nozari added that in the past two years, oil production exceeded 4 million barrels per day, currently at 4.21 million BPD, which is a new record since the 1979 Islamic Revolution. He said about 2.5 million barrels per day was exported.

US justice department launches probe of Alcoa

It is reported that US Department of Justice has launched a criminal investigation into whether Alcoa Inc, one of its subsidiaries and people connected with the unit committed fraud, corruption and bribery in its relations with customer Aluminum Bahrain BSC.

In a motion filed recently with the US District Court in Pittsburgh, the Justice Department asked the court to put a temporary hold on a Alba's civil suit against Alcoa, the world's largest supplier of alumina, the principal raw material used in making aluminum. The suit also names affiliate Alcoa World Alumina LLC, Mr William Rice former Alcoa World Alumina Vice President of Marketing and Mr Victor Dahdaleh an agent of Alcoa and Alcoa World Alumina as defendants.

The department wrote in its motion that "The Alba complaint alleges numerous facts which, if true, could be relevant to the government's criminal investigation and a potential criminal trial."

Mr Kevin Lowery spokesman of Alcoa said that Mr Rice is an Alcoa employee, Mr Dahdaleh is not. He said "We did not object, and we also told them we would be cooperating fully, partly because we see this as opportunity to get speedy resolution to the entire matter. We have continued to look into the matter and have yet to find that Alcoa hasn't lived up to its values."

Alba which is 77% owned by the government of Bahrain also accuses the defendants of overcharging it for alumina. It did not name the official to whom bribes were allegedly paid.

Construction projects in Pakistan hit by rebar price surge

Pakistani media has reported that due to the escalating international steel and raw material prices, construction activities in Pakistan are hampered as Pakistan is dependent on imports to a great extant. As per report, many of the projects have stopped due to the rising steel prices and on the other hand the rising cement prices in the local market are putting additional burden on construction sector.

As per a report in The News, PKR 6,000 per tonne has been raised on billets and PKR 3,000 to PKR 4,000 on galvanized steel during this week. The report cited a Pakistan Steel Mill source as saying that there has been an increase of USD 135 per tonne in the international price of billets and therefore PSM would raise billet prices according to these developments.

The report also quoted Mr Abdul Sattar Bhagani of Abdul Sattar Noor Muhammad Group as saying that the prices of rebars are at PKR 80,000 per tonne level up from PKR 65,000 per tonne last week.

Abu Dhabi to invest heavily to meet the power demand

Abu Dhabi Water & Electricity Company has announced that it will have to invest heavily to meet spiraling demand which is expected to triple by 2015 on a boom in the Gulf emirate's construction and industry sectors.

Mr Keith Miller director for planning and studies at ADWEC said that "Massive investments are needed in the long term to expand existing power generation units and build new plants." He added that the emirate's peak demand stood at about 5,286 MW and is expected to surge to 8,276 MW in 2010 and 14,946 MW in 2015. Demand for water is expected to double by 2030 to 1.2 billion gallons of water per day from 560 million gallons of water per day.

Mr Miller said that "ADWEC's power capacity stood at 8,312 MW at the end of 2006 and 668 million gallons of water per day. It will have additional capacity to meet long term demand and new plants will be built. We have plenty of time."

The economy of the UAE is booming on a more than 5 fold increase in crude oil prices in the last 6 years. Power demand is also growing due to a rapid growth in the population, which is expected to surge to nearly 3.17 million by 2030 from around 1.3 million at present.

DP World moving ahead with Kerala and WB plans

BL reported that leading global port operator Dubai Port World is going ahead with its current projects in Kerala and West Bengal where it plans to have a say in India’s cargo traffic across the Indian Ocean.

DP World’s projects at Kulpi in West Bengal and Vallarpadam in Kerala are both green field projects and greater part of the USD 500 million worth Indian investments, announced last year, has been invested in the development of these facilities.

Currently, DP World operates terminals in India at Mundra in Kutch district, Nhava Sheva International Container Terminal in Maharashtra, Chennai, Kochi and Visakhapatnam. It handled 4 million TEUs in India last year, including 650,000 TEUs at Mundra.

DP World is also currently developing facilities for the new container terminal at Vallarpadam within the Cochin Port Trust administration. With the commissioning of the new container handling facility at Vallarpadam, the existing container terminal will be handed over to the Cochin Port Trust administration for developing it as a non container facility. The Cochin Port Trust would develop road and rail links to the new facility in the first quarter of 2009.

DPW is also developing a multi-product SEZ spread over 1,040 hectares and a green field container terminal on the east bank of River Hooghly. The port will be connected to the National Highway network through a new four lane expressway and a new bridge across the river, both of which are being developed by the West Bengal Government.

Chinese firm to open unit in Dubai

China Architectural Engineering, which designs and installs curtain wall systems of glass, steel and stone for commercial applications and has won a contract for Dubai Metro has announced that it will open a subsidiary office in Dubai in 2008.

Mr Ken Y Luo chairman & CEO of China Architectural Engineering said the expansion to Dubai is aimed at targeting the massive construction boom in the region. He said “CAE has a long term commitment to the Middle East and foresees significant future demand for construction projects from Dubai and other cities in this region. We are in the process of setting up a subsidiary in Dubai this year to capture this significant demand.”

Mr Y Luo added that “The Dubai Metro project promises to be our largest effort yet outside China, with potential revenue far beyond that of the initial contract. As a major step forward in CAE’s expansion strategy, it will serve as an announcement of CAE’s arrival in one of the largest construction markets in the world.”

Work on both Dubai projects is expected to be finished by the second quarter of 2009.

Pakistani cement industry reeling under coal price surge

The News reported that Pakistan’s cement industry, being dependent on coal, is going through a tough time due to the rising international coal prices and that the surge in prices may change the very nature of the energy mix of Pakistan.

During the last 6 months, the prices of coal and furnace oil have doubled and it is increasing with the rising international oil prices generating a direct burden on the cement industry as they use coal as the basic fuel. According to a cement company’s official, the rising coal prices have already increased the manufacturing cost of cement up to PKR 15 to PKR 20 per bag and they say that there is a need to pass on this burden otherwise the cement industry would suffer considerably.

At present most of the cement companies in Pakistan have switched to coal or gas as their basic fuel; the process has been completed in the last 6 to 7 years. According to the data of the All Pakistan Cement Manufacturing Association of mid 2007, the cost of cement production per tonne by furnace oil was around PKR 2,083 whereas the cost of production per tonne by coal was PKR 868, saving KR 1,215 per tonne. Similarly, the saving per bag was PKR 60.75, which is a huge difference.

Pakistan has considerable coal reserves: tidal, solar and hydel potential. It is ironic that Pakistan has fourth-largest coal reserves in the world but it is importing 2.5 million tonnes of coal per annum for the cement industry. At the same time, due to high cost of energy, the government has also decided to enhance the share of coal in the overall energy mix from 5 to 18 per cent up to 2018.

Among the other alternative sources, coal is the main source for producing cheaper electricity and its availability is much higher. In view of predictable shortfall of electricity and other energy resources during the next 10 years, demand for indigenous coal would grow in power generation considerably.

The cement industry being the second biggest coal user in the country but is using imported coal as a fuel instead of local coal due to the high percentage of sulphur in it. Javed Ali Khan, CEO of Pioneer Cement said that local coal contains 6% of sulphur which is not suitable for cement industry; however, the imported coal contains 1% of sulphur.

Gulf power crisis presents big opportunity to global majors

It is reported that the demand for power plants in the GCC over the next seven years could lead to contractors gaining a stake in power projects.

According to estimates from MEED, projects worth a combined USD 50 billion will be needed to meet the demand for 60,000MW of power by 2015. But as demand escalates, contractors grappling with capacity issues have said that plants may only get built if project ownership is shared with developers.

Mr Ilias Abdo CEO of Powerflow Engineering said "If the current demand continues we believe we may have to become stakeholders. He said one of the biggest impediments to power plant construction is finding skilled engineers.”

He added that "Timeframes are not being kept because of the vested interest of the different contractors on a project all working on different phases, which has a knock on effect on the next phase. One of our challenges is getting all those involved to have a vested interest in the entire project.”

According to Dr David Barlow head of business development, Middle East & Africa, International Power, making contractors stakeholders to overcome such issues could lead to other problems. He said "We have seen contractors take stakes in independent power projects, particularly elsewhere in the world, but unless the investment is managed well there could be a conflict of interest."

Mr Sujit Tharakan director of engineering & projects division of Kuwait-based K4 General Trading & Contracting Company said "Obviously, the contractor will be looking to maximise its profit. It will want to make a profit as a contractor and also out of the development, which could lead to a conflict of interest."

Bahrain upbeat on new oil well plans

It is reported that Bahrain will add a number of new wells in the next 15 years.

Dr Abdulhussain Mirza oil and Gas Affairs Minister and National Oil and chairman of Gas Authority unveiled the grand target set to boost the oil production of the oil dependent country.

He said “In the coming 15 years we are planning to add another 700 wells to maintain and increase oil production. Many of the wells will be special architecture wells to maximize reservoir contact in order to improve well productivities.”

Dr Mirza said “With the right technology, business environment and people the energy challenges of the future are within our collective power to resolve. It is up to each of us to work towards making that happen.”

The small GCC-state, where the first oil field in the Gulf was developed aims to encourage foreign investment in the upstream sector and to step up exploration and development efforts to meet growing energy demand.

In 2006, Bahrain produced about 35,000 BPD of crude oil. Its proven oil reserves stood at about 125 million barrels as of January 2007. Over the years, Bahrain has been slow to explore for oil in its offshore waters.

Limitless announces USD 12 billion mega project in Riyadh

Dubai based developer Limitless has announced details of a new mega project in Saudi Arabia.

The USD 12 billion Al Wasl project, to be located in the capital Riyadh, will cover more than 1,400 hectares and include over 300 hectares of green space. The development is expected to provide 55,000 homes.

Mr Saeed Ahmed Saeed CEO of Limitless said that the project will be a sustainable, modern community, which is expected to create some 50,000 jobs. He added that the Al Wasl project is the first in a number of projects planned for Saudi Arabia.

Other projects by Limitless in the GCC region include the Arabian Canal and Downtown Jebel Ali developments, both located in Dubai.

Chinese rebar and wire rod export prices continue to move up

It is reported that export offers for Chinese rebar and wire rod export prices continue to move up this week although domestic market prices were largely unchanged during the week.
On Shanghai market, HRB335 20mm rebar was being quoted at CNY 4710 per tonne to CNY 4730 per tonne, HRB400 at CNY 4800 per tonne to CNY 4820 per tonne. Commercial wire rod was at CNY 5000 per tonne level and hi speed material at CNY 5040 per tonne.

Export offers for rebar were at USD 860 per tonne to USD 870 per tonne on FOB basis another increase of USD 30 per tonne to USD 40 per tonne ton from early last week.

Wire rod was being quoted at USD 890 per tonne to USD 900 per tonne FOB.

As per report there is strong likelihood that export quotations would stay at high level, but it remains to see how the transaction would be at the updated levels.

(Sourced from MySteel.net)

Chinese SBQ steel market remains active

It is reported that China’s domestic ship steel market would remain steady generally. Although the price may fluctuate slightly in a period, it would not drop significantly and will remain high instead.

The quotation of 8mm ship plate from Baosteel is CNY 6,800 per tonne at present and offers of 10mm and 12mm to 20mm ship plate are CNY 6,500 per tonne and CNY 6,450 per tonne respectively up by over CNY 250 per tonne. The concluding price of 12mm to 20mm ship plate is around CNY 6,500 per tonne up by CNY 300 per tonne.

For transactions in ship plate market, traders said that the distribution is satisfying and they have already sold 4,000 tonnes with an average distribution of 500 tonnes to 600 tons at a price between CNY 6,250 per tonne to CNY 6,300 per tonne.

The supply of ship plate in the market is tight, so some big and medium sized shipbuilding companies place orders to steelworks directly. Only traders and small sized shipbuilding companies and boatyards purchase a small quantity in communicating market.

Shagang to export 2 million tonnes steel in 2008

It is reported that Shagang is speeding up the move in steel export market and has developed markets in 30 countries and areas. In 2007, the company had an import and export value of more than USD 3.2 billion with high grade and new products winning a foreign exchange of USD 1.48 billion.

In 2008, Shagang targets at having an export volume of 2 million tonnes in total and realizing foreign exchanges of more than USD1 billion by high grade products in particularly the high carbon steel wire, high strength high grade hot coiled sheets, and ship plate and line pipe steel and other high value added products.

Shagang rank third in steel export volume, with the export volume of high carbon high grade wire rod maintaining the leading position.

Iron ore price negotiations – WISCO terms settlement as outrageous

Mr Deng Qilin general manager of Wuhan Iron & Steel while speaking at the sidelines of 2008 NPC & CPPCC said that "The benchmark ore price hike is crazy and outrageous. “

Mr Qilin warned that “The ore miners would pay the price for their irresponsible and short sighted act sooner or later.”

He said that "We would take up various measures to cut cost and recoup the higher iron ore price. Moreover, stepping up production of higher value added products is another option. He added that "Lifting up steel prices is not a permanent cure to escalating input costs. Wuhan Steel would step up efforts in three main sectors, such as enhancing the production of high end products, expanding output at captive ore mines and accelerating investment into foreign ore mines."

(Sourced from MySteel.net)

Chinese domestic coal price may increase further

It is reported that on March 20th 2008 many coal companies were willing to raise coal prices and Shanxi Lu’an Group, Yangquan Coal Industry Group, Datong Coal Mine Group and Shanxi Coking Coal Group and some coal mines have already requested coal price to rise up by CNY 30 per tonne to CNY 50 per tonne.

Experts believed that it is because of tight supply of coal in early 2008. Additionally, international coal price has been increasing by almost 50% since 2008, but the growth rate of domestic coal price is lower.

Mr Gong Yunhua the energy analyst from Guojin Securities said that the tight supply of coal in early 2008 was not caused by short coal resources, but caused by occasional factors instead, such as blocked transportation by heavy snow, the peak of demand for coal in winter, and so on.

An official from a coal company noted that, however, the cost in coal industry has been soaring in recent years. The rise environmental cost, mineral resources compensation expenses and increasing personnel cost since 2006 have boosted the cost in coal mines increased by around CNY 70 per tonne than in early 2006. The allowance from the government is not enough and they hope to raise coal price suitably.

Ms Yuan Xiaomei coal industrial analyst from Oriental Securities believes that although domestic coal price is pressed down, it would be boosted to a new record by the hike of international price and strong demand from domestic market. She points out that the reconstruction after heavy snow has already been completed gradually. Along with the resumption of production and living, the electricity burthen will climb up further, as well as the demand for coal.

Chinese domestic pig iron market stable

It is reported that pig iron market in China on March 14th remained high level and stable, there was a pig iron short supply in most areas and spot goods of steel mills attracted many downstream users.

Pig iron conversion price in Tangshan of Heibei province was CNY 4150 to CNY 4200 per tonne, CNY 4200 to 4250 per tonne in Wuhan city. Foundry pig iron price was CNY 5000 to 5030 per tonne and CNY 4980 to 5000 per tonne for ductile cast iron, CNY 4200 to 4300 per tonne for that in Yicheng county of Shanxi province, foundry pig iron and ductile cast iron price was generally CNY 4950 per tonne. Pig iron conversion price in Shandong province was CNY 4300 to 4400 per tonne and CNY 5000 to 5050 per tonne for foundry pig iron.

Foundry pig iron price in Northeast of China Harbin was CNY 4600 to 4630 per tonne and CNY 4400 to 4430 per tonne for pig iron conversion price. Ductile cast iron price and pig iron conversion price in Fushan city was generally CNY 5000 to 5050 per tonne.

Pig iron conversion price in Dalian was CNY 4050 to 4080 per tonne, CNY 4320 to 4350 per tonne for foundry pig iron, and ductile cast iron price was CNY 4620 to 4650 per tonne. Pig iron conversion price in Anshan was CNY 4080 to 4100 per tonne, but in later market price might rise.

(Sourced from MySteel.net)

Shandong to eliminate steel obsolete capacity

According to Shandong Economy and Trade Commission that last year, Shandong province closed and eliminated iron making capacity of 2.48 million tonnes, 3.706 million tonnes of steel making capacity, achieving the obsolete steel capacity elimination target stipulated by the country.

According to responsibility letter about suspension and elimination backward steel production capacity which is signed by NDRC and Shandong Province Government, Shandong closed and eliminated obsolete steel production capacity of the first batch of 17 enterprises, with the total iron making production of 4.90 million tonnes and 7.91 million tonnes of steel making capacity.

It is realized that Shandong province will continue to eliminate 6% of steel making capacity and 15% iron making capacity.

Baosteel Baori sells 1.11 million tonnes of auto sheets

It is reported that Baosteel top management led by Mr Xu Lejiang chairman met a delegation led by Nippon Steel vice president, who is also chairman of Baori Auto Sheet Company Limited at Baosteel Building on the morning of March 11th 2008.

In 2007, Baori Auto Sheet, a three party joint venture of Baosteel, Nippon Steel and ArcelorMittal, sold 1.11 million tonnes of auto sheets with O5 sheet, outside panel and galvanized outside panel for passenger cars and high strength auto sheet all hitting all time highs.

Laiwu Steel benefits from backward elimination

It is reported that Laiwu Steel has shut down three 25 tonnes electric furnaces, four 128 cubic meter blast furnaces and two 58-II coking ovens since December 2005 with outdated capacity crackdown of 2.11 million tonnes. In the process of facilities elimination, the mill was shaking off rotten legacy while updating and optimizing its facilities and processes.

Laiwu spent CNY 2.17 billion on the reforms of energy conservation and emissions reduction, and developed a series of new technologies, pushed for advanced clean production mechanism and introduced 14 world class facilities and technologies.

The mill was well programmed from the very beginning by building five 6 m large coking ovens, three 600,000 tonnes grate rotary kilns, three 265 square meter sintering machines, two 1880 cubic meter blast furnaces, three 120 tonnes converters, 1500mm hot rolled strip mill, continuous casting machine for profiled billet and large H-section rolling mill. It passed national environmental assessment for its technical reform projects last year.

Baosteel employees bag "Star of Satisfying Service for Users" awards

It is reported that Mr Zhang Feizhou, a project manager with Baoshan Iron & Steel Company Ltd Engineering Equipment Dept is awarded National and Shanghai "Star of Satisfying Service for Users" for Year 2007.

Mr Bao Ping the chief engineer of Baosteel Nippon ArcelorMittal Automotive Steel Sheets Company Ltd and an employee with Baoshan Iron & Steel Co Ltd Sales Department of Technical Service Office is gloriously elected as Shanghai "Star of Satisfying Service for Users" for Year 2007.

PetroChina calls for fuel price hike

It is reported that Chinese oil and gas company PetroChina has asked the government to increase fuel prices to reduce its refining losses from high crude costs on the international market. The company has also asked the government to cut fuel import tariffs.

Mr Jiang Jiemin president of PetroChina said the producer proposed adjustments to refined product prices. He said "The break even point of our refining business was at about USD 66 to USD 67 a barrel of crude for each dollar gain beyond that level we will lose CNY 3.24 billion in a full year."

PetroChina's refining business saw a loss of CNY 20.68 billion in 2007, representing a reduced loss of CNY 8.48 billion compared with the previous year.

Chinese refiners are all making losses due to gaps between soaring world oil prices and low government-set domestic fuel prices. Regions in southern Guangdong province, including Guangzhou and Shenzhen, have seen gasoline and diesel supply shortages recently. But analysts say the government is reluctant to raise fuel prices due to the high consumer price index.

PetroChina is the country's second largest refiner. The biggest refiner, Sinopec said on March 20th it will receive CNY 12.3 billion in government subsidies to ward off oil processing losses.

Baosteel employs GPS to track movements

It is reported that Baosteel’s self developed GPS/GIS information service system which has international leasing level was formally put into use on March 20th.

In the future, the users regardless of anywhere and anytime can exactly grasp the location of the vessel and vehicle and the moving lines in time only through clicking the mouse.

This system can not only control the whole process for the goods from the factory to warehouse, but also on line monitor vessel and vehicle for the goods transportation, greatly enhance the efficiency and effectiveness of modern logistics industry.

As per report, Baosteel is the first steel enterprise using GPS system in China.

Tianjin Port starts liner route for steel trade to Shanghai

It is reported that recently, a vessel sailed from Tianjin Port to Shanghai Port with 10,200 tonnes of steel products reflecting the liner sea route for domestic steel trade formally started.

As per report, Tianjin Port will strengthen steel transportation in this year and open steel ship lines. It is expected to start domestic steel trade lines to the south and east of China, in order to form a transportation structure mainly for steel coil, medium plate, steel billet, rebar, etc and to further increase the throughput of steel.

Tianjin Port shipped 32.42 million tonnes of steel products up by 45% YoY and the export volume rose up by as high as 86% YoY.

Shandong Province found 17 new mineral deposits

It is reported that Shandong Province has invested large amount of money to prospecting in the entire province in order to solve problem of the minerals following resources insufficiency.

They invested CNY 6.7 billion last year and found 17 new important mineral resource deposits.

According to the Shandong Province land resources department, since last year, there are important progress that depth portion prospecting and the crisis mine have replaced the resources prospecting work. The prospecting work have a great break through especially for gold, iron, coal, copper and some other important mines. The Laizhousizhuang gold mine, Jiningyandian iron mine and Caoxian Dingtao coalfield in these 17 new mineral resource deposits have great influence.

XuJingyan, the capital of Shandong Province land resources hall said that they will adopt new technological ways, prospecting in the important diggings regions, seeking for the gold, iron ore, coal, and diamond, copper, molybdenum, lead, zinc and so on.

OMK Vyksa pipe output in February down by 20% YoY

It is reported that of United Metallurgical Company’s Vyksa Steel Works reviewed its performance in February 2008.

In February 2008, the plant produced 123,576 tonnes of various pipe grades down by 20.3% YoY as compared with February 2007. The output of large diameter pipes was 60,627 tonnes down by 31% YoY as compared with the corresponding period of 2007.

Since the beginning of the year Vyksa has produced 226,455 tonnes of pipes down by 26.2% less than in January and February of 2007. 109,420 tonnes of LDP was produced in January and February down by 36.5% YoY in the corresponding period of last year.

In February, VSW railroad wheel rolling facility produced 67,890 railroad wheels up by 6.5% YoY as compared with the corresponding period of 2007. Since the beginning of the year VSW has produced 141,000 wheels up by 12.6% YoY as compared with January and February of 2007.

According to Mr Vladimir Markin president of OMK President, the current reduced demand for large diameter pipes and medium diameter oil and gas pipes is due to the completed deliveries for a number of major main pipeline projects and the projects postponed by Gazprom as well as to the fact that oil and gas companies have yet to hold tenders for oil and gas pipe supplies for the current year. Additionally, this year will see a number of major project launched in which OMK intends to participate, including the second stage of the Baltic Pipeline System, Nord Stream and some others.

United Metallurgical Company is one of Russia's largest producers of pipes, railroad wheels, and other metal products for energy, transport, and industrial companies. OMK comprises six largest enterprises in the metallurgical sector.

Gazprom delegation visits Izhora Pipe Plant

It is reported that a Gazprom delegation led by Mr Alexander Ananenkov deputy chairman of the Management Committee visited Izhora Pipe Plant recently.

The delegation comprised of Mr Yaroslav Golko member of the Management Committee, Mr Igor Fyodorov head of the Investment and Construction Department, Member of the Management Committee, Director General of Gazkomplektimpex and specialists of Gazprom’s core business units.

Mr Alexander Ananenkov addressing in a meeting pointed out that Gazprom is one of the world’s largest large diameter pipe customers and is traditionally geared towards products of Russian companies.

He said “Gazprom is planning to develop a new gas production centre on the Yamal Peninsula in the harsh environmental conditions of the Far North. The Company will put extremely high demands on the equipment to be utilized during the Yamal fields development and gas transportation. This also involves large diameter pipes.”

Mr Alexander Ananenkov said “We can see that domestic producers are capable of turning out products not only competitive on the global market, but also outdoing their foreign analogues. The Izhora Pipe Plant has mastered production of unique 1,420 mm pipes designed for a 120 Ata working pressure. They will be utilized during the Bovanenkovo Ukhta gas trunkline construction.”

Nabucco pipeline to deliver gas to Europe by 2013

Reuters cited Mr Reinhard Mitschek the project's managing director of Nabucco as saying that Nabucco natural gas pipeline project aimed at diversifying natural gas supplies to Europe, will deliver its first gas to Europe by 2013.

He said that gas from Iran could be carried through the Nabucco pipeline if there was sufficient demand, despite protests from the United States. He added that "If the demand comes from European buyers, we will bring Iranian gas to Europe through the Nabucco."

The reported added that EUR 4.6 billion pipeline is expected to carry 21 billion cubic meters annually from the Caspian region to European consumers in order to lessen Europe's dependence on Russian gas. But finding supplies in the Caspian region have been problematic and the United States has protested calls from Turkey for Iranian supplies to be included in the 3,300 kilometers pipeline.

Gubakha Coke output in February up by 29% YoY

Gubakha Coke Perm Territory, part of United Metallurgical Company, reviewed its performance in February 2008.

As per report over the last month, Gubakha Coke produced 39,900 tonnes of bulk coke and processed 5,600 tonnes of coal tar pitch. The coke output exceeded the volumes in the corresponding period of 2007 by 29%.

United Metallurgical Company is one of Russia's largest producers of pipes, railroad wheels, and other metal products for energy, transport, and industrial companies. OMK comprises six largest enterprises in the metallurgical sector.

Ukraine prohibits Naftogaz from transporting gas through RosUkrEnergo

Interfax cited Mr Valentin Zemlyansky a spokesman for RosUkrEnergo as saying that the Ukrainian Cabinet of Ministers has prohibited Naftogaz Ukrainy from using the Swiss registered RosUkrEnergo services to transport gas through Ukraine.

The decree states that the Central Asian gas received by Ukraine's gas transport system from RosUkrEnergo after January 1st 2008 is used solely for satisfying the needs of Ukrainian consumers in volumes determined by the forecast balance reflecting gas receipt and distribution in Ukraine in 2008. At the same time, the text of the document is identical to Decree No 163 dated March 5th 2008 which was made public two weeks ago.

Mr Konstantin Chuichenko executive director of RosUkrEnergo said RosUkrEnergo exported to Europe 8.67 billion cubic meters of gas in 2005 and 8.95 billion cubic meters of gas in 2006. He said in January 2007 that in 2006 the company has supplied 3.5 billion cubic meters of gas to Slovakia, 2.5 billion cubic meters of gas to Poland, 1.9 billion cubic meters of gas to Hungary and 0.8 billion cubic meters of gas to Romania.

Mr Chuichenko also said RosUkrEnergo plans to increase its gas export to Europe in 2007 to 10.5 billion cubic meters.

In 2007, Naftogaz Ukrainy provided to RosUkrEnergo gas transit services 11.6 billion cubic meters, of which 5.6 billion cubic meters was taken from underground storage facilities in Ukraine.

Norilsk Nickel launches new website

MMC Norilsk Nickel launched its new corporate website www.norilsknickel.ru/en.

The new orderly structured site designed in a more colorful and stylish fashion contains more sections dedicated to important areas of the company’s activities. The primary reason for the website upgrade is the company’s commitment to implementing best corporate governance and information disclosure standards in its new capacity of a global player.

The website sections will feature detailed information about the Company’s overseas operations including Stillwater Mining Company and assets in Finland, Australia, South Africa and Botswana to reflect the global scale of MMC Norilsk Nickel’s activities and its presence in the world’s major mining and metal production regions.

According to Ms Elena Kovaleva director of Public Relations Department, Norilsk Nickel, Russia’s major public miner and metal producer has always demonstrated the highest level of informational openness and transparency. Expert RA agency and MICEX in cooperation with PricewaterhouseCoopers named the previous version of the Company’s website the industry’s best resource in 2007.

Ms Elena Kovaleva said “The high appreciation of our achievements will not keep us from setting even higher standards and improving the informational toolkit of the Company. This is why we upgraded the website to make it a more convenient and useful resource for all persons interested in learning more about MMC Norilsk Nickel.”

OMK Vyksa to get CE certification for pipes

It is reported that United metallurgical company OMC’s Mining Metallurgical Plant VMZ in Nizhny Novgorod region has received from the Association of German engineers TUV NORD Systems certificate of conformity production of pipes of small and medium diameter used in construction, standard EN 10219-1 and Directive 89/106/EC. The certificate entitles causing pipes to the CE marking.

As per report the certificate issued by Test tubes through certification audit, which the representatives TUV NORD Systems VMZ held on March 11th to 14th 2008. During the audit at the factory laboratories were also tested medium diameter pipes for the oil and gas industry on the line Directive 97/23 / EU standard EN 10217-1. Samples of these pipes designed to carry out further tests to Germany. In the case of a positive outcome production VMZ will be certified for compliance with the Directive 97/23 EC.

Certification VMZ production system will enable TUV OMC expand presence in the European market pipes.

Ukraine to sell 60% stake in 4 utilities in 2008

Ukrainian News Agency reported that cabinet of ministers of Ukraine has decided to sell a 60% stake plus one share in each of the Dniproenerho, Tsentrenerho, Zahidenerho and Donbasenerho power generating companies in 2008.

The cabinet of minister’s directive No 478-r dated March 19th 2008 approved the decision and made the relevant amendments to the addendum No 1 to its resolution No 367 of February 22nd 2008.

As Ukrainian News earlier reported, the cabinet of ministers recently postponed transfer of management of a 60% stake plus one share in each of Dniproenerho, Tsentrenerho, Zahidenerho and Donbasenerho to the State Property Fund because of the need to agree the transfer with Mr Viktor Yuschenko president of Ukraine.

At present, 85.77% of the shares in Donbasenerho, 70.1% of the shares of the Zakhidenerho and 78.29% of the shares of the Tsentrenerho have been contributed to the statutory capital of Energy Company of Ukraine, a national joint stock company.

Japan and Russia ink Siberian oil development pact

It is reported that a Japanese government agency recently concluded a cooperation framework agreement with Russian state run oil company Rosneft with an eye to developing oil fields in eastern Siberia.

Japanese officials said the pact calls on Rosneft to cooperate with Japanese companies in technical development and other areas, while the Japanese government's Agency for Natural Resources and Energy will provide support.