Indian PM convenes meeting on prices

It is reported that Dr Manmohan Singh Indian prime minister has convened a special meeting of the Cabinet Committee on prices today.

Dr Manmohan will review the availability and prices of all essential commodities including edible oils, pulses, wheat, rice, sugar, vanaspati, cement and steel.

The meeting will evaluate the import and export position of all essential food commodities.

TATA Corus Teesside Cast Products slab export in 2007 surges

It is reported that TATA Corus Teesside Cast Products has become the world’s leading exporter after sending 2.4 million tonnes out into the global market in 2007. The figure is an increase on 2006’s export figure of 1.6 million tonnes and 900,000 tonnes in 2005.

As per reports, 2.4 million tonnes of slab was primarily exported in 2007 to a consortium of international steelmakers including Duferco, Marcegaglia, Ternium Imsa and Dongkuk as part of a landmark 10 year off take agreement with Teesside Cast Products.

The has come on the back of continued investment in the plant, technical development and the creation of a EUR 10 million rail link to Teesport. Corus has worked in partnership with PD Ports and between them they have invested more than EUR 10 million to ensure world class performance in handling and dispatch of slabs.

To streamline the export of its steel slab, Corus invested in a new rail link direct from its slab yard to Teesport. PD Ports also invested in specialized forklifts, cranes and associated handling equipment to further improve efficiency. The rail link was completed in September 2006 and that, coupled with the performance improvements and the benefits from the investments at both businesses, has seen shipments rise from 20,000 tonnes per week to 50,000 tonnes per week.

Mr Jon Bolton MD of Teesside Cast Products said that "We have come a long way since 2005. It is fantastic to see that Teesside Cast Products is exporting more steel slab than any other steelmaker. We continue to invest in the plant, our people and processes and we plan to continue to push our export rate even higher over the next few years."

A tribute to Indian steel legend Mr OP Jindal

Mr Om Prakash Jindal was born on August 7th 1930 to a farmer Mr Netram Jindal of village Nalwa of district Hisar in Haryana and on the 3rd death anniversary, his contribution to Indian steel sector need to be revisited as he was a successful industry visionary and would remain as a role model for others.

Since his childhood, Mr Jindal was interested in technical work and started his industrial career with a small bucket manufacturing unit in Hisar. In 1964, he commissioned a pipe unit Jindal India Limited, followed by a large factory in 1969 under the name Jindal Strips Limited. At present, there are twenty factories under the flagship of the OP Jindal Organization.

Mr Jindal always had the conviction that India should be self reliant in every sector of industry. He visited several foreign countries to elicit latest industrial technical development and know how and acquired a great deal of knowledge, which he aptly applied to enhance production of his industrial establishments.

In November 2004, he was conferred the prestigious “Life Time Achievement Award” for his outstanding contribution to the Indian steel industry by the Bengal Chamber of Commerce & Industry.

His life's mission was to help others particularly the common man in every possible way. The list of his philanthropic activities is rather long. Mr Jindal's philosophy was that without the upliftment of weaker and backward sections of society our nation's dream of being a leading nation of the world shall remain unfulfilled. To realize this conviction he was motivated into politics and he became a Member of the Haryana Legislative Assembly in 1991 and in 1996 he was elected as a Member of Parliament in the 11th Lok Sabha from the Kurukshetra Parliamentary Constituency of Haryana. In fact, he was the first industrialist of India to be elected as a Member of Parliament in Lok Sabha.

Mr Jindal's mantra was “Where others saw walls he saw doors”. Then whether it was opening doors or breaking down walls he always led the way. The life journey of Mr Jindal from a farmer's son to a successful industrialist, a philanthropist, a politician and a leader would serve as a great source of inspiration for generations to come.

CIL plans extending coal varieties based on useful heat value

BL reported that Coal India Limited is now hopeful of broad basing its product range from the existing 8 grades to approximately 30 varieties within the set parameters of useful heat value based gradation system. The switch over is likely to take place in the next 6 months.

The proposed product range will narrow down the useful heat value within the grades from the existing band of 900 to 1,100 kilo calorie to 200 to 300 kilo calorie. Coupled with the present move to switch over from linkage to the fuel supply agreement regime, the broad basing of product range with separate price tags for each variety, if approved by the centre, will improve CIL’s earnings substantially in the future.

A CIL official said that "The existing calorie band between the grades is a built in disincentive for producers for not attending to quality. Redefining the product range will address the issue."

He added that such classification for raw coal may be done away with once CIL attains its vision of supplying only processed washed coal in the future, thereby creating an environment for a move to gross calorific value based product classification.

This move comes after CIL failed to convince the centre for a switch over to the internationally accepted gross calorific value based gradation for its produce,

Global slowdown hitting investments in India – FM

Mr P Chidambaram union finance minister last week said that global slowdown is affecting investment in India as investors were deferring their plans in the country.

Stating that there were clear signs of a slowdown in the world economy, Mr Chidambaram said that the pessimism is affecting the decisions of global investors, who are adopting the policy of wait and watch.

He added that "This has obvious negative effects on future growth. Global slowdown, rising inflation and subdued interest in investment make for a combination that can have only negative consequences for developing countries. There is a growing feeling among international experts that the US economy faces serious recessionary pressures."

He said developing countries, including India, were helpless victims of global uncertainty. Referring to the impact of the US slowdown, he said turbulence in the financial markets had added to the difficulties of sustaining high growth in India. He added that "As the crisis moved from one market to another, and when it entered the credit market, the consequences of the crisis are being felt in India too."

Mr Chidambaram further added that many banks in Germany and the UK had to be bailed out after the sub prime mortgage crisis hit the US, though Indian banks had so far remained largely unaffected.

JLR suppliers happy with TATA acquisition

It is reported that auto component suppliers to Jaguar and Land Rover are happy with the TATA Group at the wheel of the UK luxury car brands.

BBC quoted Mr John White of IM Kelly Automotive as saying that he is happy because TATA was successful with every single thing that they do. IM Kelly automotive supplies interior trims and finishing for Jaguar and Land Rover.

It also quoted Mr Geoff Bayton director motor component supplies of B squared as saying that initially, there were worries on account of different consortiums that were looking to get involved, but the take over by the TATAs gives them a good feeling and has given the workforces a lot of confidence.

Coventry Telegraph hailed the acquisition as great news for workers across Coventry and Warwickshire, saying that the deal was welcomed by workers, trade unions, business leaders and local suppliers alike. It said that the acquisition secures the jobs of thousands of workers in Coventry and at Gaydon in south Warwickshire.

Jaguar had been a loss making brand for Ford ever since it was brought by US auto giant in 1989. Jaguar's sales have declined by 25% during February 2008 as compared to February 2007. In the US, its key market, year on year sales were down by over a third compared to sales figures from February 2007.

Though Land Rover was profitable, its waning sales graph did not work in its favor when the time came for Ford to decide whether to jettison the brand. Land Rover's sales in the United States were down by 10% and European sales down by 12% compared to its sales figures from a year ago in 2007.

Indian major ports capacity to cross 1 billion by 2012

Mr TR Baalu union minister of shipping, road transport & highways said that the aggregate cargo handling capacity of the 12 major ports in 2007-08 has been projected to touch 528.75 million tonnes per annum by March 31st 2008 and 1,016.55 million tonnes per annum by the end of the 11th Five Year Plan, following berth development, procurement or modernization and up gradation of cargo handling equipment.

Mr Baalu explained that development of infrastructure in major ports was an ongoing activity, keeping in view the demands of maritime trade. The activities, performance, productivity and the profitability of major ports varied, depending on a number of factors, including the location of the Port, its infrastructure, labor, resources and cargo profile.

During the 11th Plan, outlays of INR 1,227.74 crore, INR 1,254.79 crore and INR 1,448.20 crore were envisaged for the expansion and development of Ennore, Chennai and Tuticorin Ports, respectively. In addition to the 12 major ports under the control of the central government, there were 200 smaller ports which were under the overall jurisdiction of the respective maritime state governments.

In addition, private investment to the extent of INR 5,300 crore, INR 833.50 crore and INR 5,115.08 crore were also envisaged in the 3 ports, respectively, during the 11th Plan. The capacities in the 3 ports were proposed to be enhanced to 64.20 million tonnes per annum, 73.50 million tonnes per annum and 63.98 million tonnes per annum by the end of the 11th Plan.

SAIL SSP employees get workers awards

It is reported that five employees of Steel Authority of India Limited’s Salem Steel Plant have won the state government’s exemplary worker award for 2005 organized by National Safety Council & Factories Inspectorate.

The winners received the awards from the labor minister Mr TM Anbarasan at a function held in Chennai on March 25th 2008.

As per report, Mr P Lakshmanan senior operator (CRM Operation) won the first prize, Mr P Venkatachalam technician (CRM Mechanical), Mr P Kandasamy senior technician (CRM Mechanical) and Mr SR Saravanan senior technician (HRM Electrical) shared second prize. Mr R Kalimuthu senior technician (CMM) won the third prize.

BPSL plans long product facilities in Orissa

SBB reported that Bhushan Power & Steel Limited is planning an expansion into long products with the construction of mills for wire rods and heavy bars at its integrated steel works in Sambalpur in Orissa.

AS per report “The first phase of the project will see the installation of a 500,000 tonnes per year combination mill to produce wire rod and bars that should be commissioned by mid 2009. The second phase will see a heavy bar mill also of 500,000 tonnes per year capacity added that will be operational by 2010. The wire rods will be 5mm to 22mm in diameter and the bars 16mm to 80mm. The heavy bars will be 60mm to 250mm.”

Mr VR Sharma joint MD of Bhushan Power & Steel Limited told SBB that the mills will be built by European suppliers but declines to identify the plant builders contracted.

He added that "The long products will mainly cater to the automobile, forging and wire industries. We plan to export 50% of the products to neighboring countries and sell the balance domestically."

BPSL operates another 200,000 tonnes per year wire rod and bar mill at its Chandigarh plant in Punjab. With the two new units set for Sambalpur, its wire rod and bar production is expected to hit 1.2 million tonnes per year by 2010.

Bombardier to supply more coaches to DMRC

Bombardier Transportation recently announced that it has received an order for supplying 84 metro coaches from the Delhi Metro Rail Corporation Limited, valued at about USD 137 million. This order follows a contract awarded in July 2007 to supply 340 metro coaches, valued at about USD 590 million.

As stated in the contract, DMRC has requested a change to the configuration of the train sets and the revised scope will be 37 train sets of 4 coaches and 46 train sets of 6 coaches. Deliveries of the latest order are scheduled to begin upon completion of the original deliveries.

Mr Rajeev Jyoti MD of Bombardier Transportation India said that "We are delighted to receive this additional option contract to supply MOVIA vehicles in New Delhi. Our relationship in India is going from strength to strength, with the opening of a new production facility at Savli, accompanied by a large local recruitment program."

It may be noted that, in the phase II expansion of Delhi Metro, the modern Bombardier MOVIA high capacity vehicles will transport 4 million passengers every day, reducing their journey time and alleviating the heavy traffic congestion and pollution prevalent in the city. The new vehicles will be produced at Savli in South Gujarat, where Bombardier is setting up a facility for manufacturing and assembly of the coaches and bogies.

REL arm wins TLT deal from Reliance Power

It is reported that the engineering, procurement and construction division of Reliance Energy Limited has bagged 2 contracts worth INR 1,200 crore for transmission projects of another group company Reliance Power Transmission Limited.

The EPC division of REL came up with the best offer on both price and the timely completion among a group of three to four companies. It has agreed to complete the work on over 1,500 kilometer transmission line by 2009 end.

Reliance Power Transmission Limited has bagged the Western Region System Strengthening Scheme project, which is India’s first wholly owned private transmission project in the western region, awarded on the basis of competitive tariff bidding. The project involves laying 1,519 kilometer of double circuit 400 kV D/C transmission lines.

REL’s EPC division undertakes engineering, design, construction and execution of industrial projects in various fields like generation, transmission and distribution, mainly focusing on the power sector to achieve and set new benchmarks in the power sector. The current project is, however, its first in the transmission area.

BHEL accuses Chinese companies of dumping

Indian power equipment major Bharat Heavy Electricals Limited has accused Chinese companies of grabbing the equipment supply contract for mega power projects by resorting to dumping.

Mr K Ravi Kumar CMD of BHEL said that "Chinese currency Yuan is under valued and there is a case of dumping.”

Mr Kumar however added that “I do not want to take up the issue in a very aggressive way. I will consider and we need not go and fight with the Chinese. We don't want 100% of the market share. With 60% of the share and having enough profits, it should be okay with us."

He emphasized that in terms of performance, BHEL equipment were much better than the competitors and referred to independent studies to establish that the plant load factor of its projects was 90%, while it was 60% in the case of Chinese equipment.

Mr Ravi Kumar said that there was a price difference of up to 20% and the Chinese valuation was also not as per international competition. He added that "Today, we have matched almost the Chinese price. We are very competitive with the competition."

BHEL has an advantage of giving a complete solution for any project as against the product leaders like Siemens and GE and cost leaders like Chinese companies.

ABB bags information system contract from ONGC

It is reported that ABB India bagged an order worth INR 430 crore orders from Oil & Natural Gas Corporation to integrate information systems across all installations of the oil and gas major. After implementation of the project, all ONGC production and drilling facilities will be monitored on a real time basis.

ONGC will be able to integrate 247 onshore production installations, group gathering stations, central tank farms and central processing facilities, processing plants at Uran and Hazira, 11 offshore process complexes catering to 157 offshore well-head platforms, 65 onshore and 9 offshore drilling rigs.

The project will be implemented in two phases. While the first phase will cover areas like IDT, Delhi, NH, Uran, Trombay, MR drilling rigs, Ankleshwar, Cambay, Mehsana, Jodhpur and Ahmedabad, the second phase will cover Assam, Jorhat, Cachar, Tripura, CBM MBA, Kolkata, Cauvery, Rajahmundry, MH and Hazira.

It is learnt that the company has already completed 94% the first phase work and 62% of the second phase.

Shipping ministry to appoint consultants for deep draught ports

BS reported that union ministry of shipping has short listed consultants for the deep sea port that would come up in West Bengal. The project is one of the five deep sea ports planned in the 11th Plan.

Mr Rakesh Srivastava joint secretary at department of shipping said that one of the 5 deep sea ports planned in the 11th Plan would come up in West Bengal. Consultants were short listed for this project.

Mr Srivastava said that centre would set up a corpus of INR 5,000 crore for the development of small and medium ports. He added that about 360 projects were identified for development with a total outlay of INR 55,401 crore. Of this, the private sector would contribute INR 36,868 crore. About 16 projects were operational with private investments to the tune of INR 5,020 crore.

TATA Motors may dilute stake in TATA Steel

ET reported that TATA Motors may dilute its shareholding in TATA Steel to finance the USD 2.3 billion acquisition of luxury brands Jaguar and Land Rover from Ford Motor Company.

The report cited some analysts as saying that TATA Motors may sell its holding in TATA Steel as it is the most valuable chunk of shares in its kitty. They however added that TATA Motors is unlikely to sell its shares in TATA Steel in the open market as any such move will substantially dilute the TATA Steel and in all likelihood would sell the shares to TATA Sons so that the group’s shareholding remains unchanged.

This follows TATA Motors’ announcement two days ago that it had raised a 15 month bridge loan of USD 3 billion from a syndicate of banks to finance the acquisition. TATA Motors said that it would mobilize funds through equity linked instruments, loan term resources and disinvestment of holdings in some group companies to repay the bridge loan.

The TATA Motors board has recently approved plans to raise nearly INR 4,000 crore by selling securities in the domestic as well as international markets to part finance overall funding requirements to meet some of the strategic plans.

Facilities to be provided on national waterways

Mr TR Baalu union minister of shipping, road transport & highways said that union government has declared 3 rivers or canal systems as national waterways.

They are
1) Ganga from Allahabad to Haldia – 1,620 kilometer
2) Brahmaputra from Sadiya to Dhubri – 891 kilometer
3) West Coast canal from Kollam to Kottapuram along with Champakara and Udyogmandal canals – 205 kilometer

Mr Baalu said that basic infrastructural facilities for shipping and navigation, such as navigational channel, navigational aids, and terminals are being provided on these national waterways. He added that "Three rivers or canal systems Kakinada Puducherry canals, along with rivers Godavari and Krishna, East Coast canal along with river Brahmani and Mahanadi delta and River Barak would all soon be declared as national waterways."

Mr Baalu further added that an action plan had been drawn up to make the 3 existing national waterways fully functional by March 2010.

Ministry charts out restructuring plan for HEC

Union heavy industries ministry has come up with a detailed restructuring plan for Ranchi based Heavy Engineering Corporation Limited. The plan was envisaged during the maiden visit to the HEC by union heavy industries secretary Mr Satyanarayan Das. The details of the entire plan are presently being worked out by the HEC authorities and the union heavy industries ministry jointly.

The preliminary proposals forwarded by the ministry include enhancing the retirement age for below the board level employees of the company from 58 to 60 years. Since the order was more of an advisory nature, most profit making PSUs, particularly in the oil, coal and steel sectors had promptly hiked the retirement age of all employees.

However, in the case of HEC, though the retirement age for board level employees was raised from 58 to 60, the benefits were not allowed to percolate down to the employees as the company was incurring heavy losses and was put under the category of sick industries by the board for industrial & financial reconstruction.

Mr Das said that the union ministry has initiated a complete capital restructuring of HEC under which, the superannuation of all below the board level employees has been proposed to increase to 60 years from 58 years. He added that "HEC is now poised to record a net profit of at least INR 5 crore during the current financial year surpassing the turnover target of INR 360 crore fixed by the centre. By March 31st 2008 the actual turnover is expected to cross INR 450 crore. HEC is also on the brink of achieving a production target of INR 1000 crore during the coming financial year."

Another significant issue of the HEC restructuring plan includes a proposal to reduce interest rates on the bridge loan of INR 102 crore granted to the company by the centre to meet its working capital requirements and a provision of seeking advances from Steel Authority of India Limited, against work orders.

Mr Das said that "HEC has already grabbed more than INR 1400 crore of work orders from various plants of the SAIL during the past 1 month. A provision of advances from SAIL against existing work orders would help HEC get its much awaited relief by way of meeting working capital requirement and would help the company meet delivery schedules. A further incentive by way of a reduction in interest rates on the INR 102 crore bridge loan would help release precious funds for execution of work orders."

Mr Das also offered some goodies for HEC employees by revealing that the ministry has recommended implementation of the overdue 1997 wage revision agreement.

Nagarjuna and Maytas Infra inks JV with Paschal Werk

Nagarjuna Construction Company Limited and Maytas Infra Limited jointly announced that they have entered into a partnership with Germany based Paschal Werk G Maier GmbH to establish a new company under the name of Paschal Form Work (India) Private Limited, wherein Paschal Werk G Maier GmbH has a 70% stake with Nagarjuna Construction Company Limited and Maytas Infra Limited having a stake of 15% each. The factory would be set up in Vizag to manufacture formwork.

Mr V Radha Krishna associate director of Nagarjuna Construction said that "It is the first time in India that modular shuttering systems will be produced and with Paschal's advanced technology in this area, we will not only impact the construction industry in urban areas but also help in speeding up the development in the rural areas."

NMP to promote small scale mining in India

BL reported that, with an outlook to prevent growth of illegal mining in India, union government is looking at promoting small scale mining of small deposits in a scientific and efficient manner through National Mineral Policy.

According to the cabinet note prepared by union mines ministry, in places where small deposits are not susceptible to viable mining, a cluster approach would be adopted by granting the deposits together as a single lease with a defined boundary.

A union mines ministry official said that "The small and isolated deposits are scattered all over India and often due to diseconomies of scale they can also lead to sub optimal mining and ecological disturbances. In order to reduce this, steps will be taken to promote small scale mining in a more scientific and efficient manner while safeguarding vital environmental and ecological imperatives."

The official said that "Efforts would also be made to grant such mineral concessions to consortia of small scale miners so that such clusters of small deposits will enable them to reap the benefits of economies of scale. Research organizations, including the National Mineral Processing Laboratories of the Indian Bureau of Mines, will be strengthened for development processes for beneficiation."

National Mineral Policy has also removed the pre requisite of value addition within the state for companies applying for an iron ore mining lease. This move is expected to benefit all the steel companies that purchase raw materials from the spot market.

The official further added that the industry is still not clear how the allotment of the iron ore mines would actually take place. Currently, the recommendations for grant of a mining lease come from the respective states where the block is located. He said "As per the policy, preference will be given for value addition while allotting an iron ore mine and will allocate a mine to a standalone mining company only in a situation where there is no application for value addition."

Vizag Port creates day handling record

Exim News Service reported that Visakhapatnam Port has handled a record quantity of 409,000 tonnes of traffic in 24 hours on March 25th 2008, surpassing the previous record of 405,000 tonnes handled exactly 11 months ago on April 25th 2007.

The cargo throughput in the current fiscal is likely to cross 64 million tonnes, an all time high in the history of the Port.

Sri Lanka scraps bid for terminal at Colombo port

Bloomberg reported that aiming to increase cargo capacity at Colombo port by half, Sri Lanka has scrapped bids for a USD 400 million terminal.

Mr Tilak Collure a Sri Lankan ports ministry secretary said that new terms will be added and fresh bids will be called in 3 months. He added that "Hutchison Port Holdings and PSA International, which were among 5 companies that bid for the 2.4 million containers a year facility at Colombo's south harbor, will have to resubmit their offers."

Sri Lanka wants to exploit its location to challenge Singapore and Dubai as a sea trading hub in Asia as a civil war pares earnings from the island's leisure industry. The Colombo port is situated on the route between the Suez Canal and the Malacca Straits that all Europe bound ships from Asia use.

The existing three terminals at the Colombo port can handle 4.5 million standard 20 foot containers a year.

Nagarjuna Fertilizers sells stake in Udupi power plant to Lanco

It is reported that Nagarjuna Fertilizers & Chemicals Limited has completely sold its 26% stake in inter state mega power project under construction at Udupi in Karnataka to the Lanco group. Nagarjuna Fertilizers’ 26% stake translated to INR 224 crore. Its exit takes Lanco group’s stake to 100% or about INR 860 crore.

Nagarjuna Fertilizers said that "There was no premium involved in the divestment as the project was under development. We want to stay focused on the fertilizer and petrochemical business."

Hyderabad based Nagarjuna group had taken over the project from Jayaprakash Engineering & Steel Company in 1995 and Lanco had earlier bought out Nagarjuna Fertilizers & Chemicals Limited’s 74% stake in May 2006.

Udupi Power Project has a power purchase agreement for 913.5 MW with Karnataka and another 101.5 MW with Punjab. The purchases by the two states are backed by a three tier payment security mechanism.

Top 10 global steel makers in 2007

As per some unconfirmed sources, following are the top 10 steel makers in 2007

In million tonnes

Readers may kindly note that these figures may undergo change when IISI published this data.

BRIC nations to transform global business landscape by 2018

According to a recent study by UK based Chartered Management Institute, India, China, Brazil and Russia, is expected to transform the global business landscape and will have a greater influence on the markets across the world by 2018. The Study said that "In the probable future, Brazil, Russia, India and China or BRIC nations will have a greater influence on business markets and transform the business landscape."

The study also revealed that the business markets would be noticeably influenced by new players from India, Brazil, Russia, China, Eastern Europe and other developing countries as well as global businesses. As new business models are introduced to respond to these changes, there would arise the need for greater emphasis on new skills, such as understanding diversity and foreign cultures.

The study forecast that in the next 10 years the business models and structures would change in nature and there would be a polarization from global companies to virtual community based enterprises. It said that "To succeed, organizations would need technology that is able to capture and analyze implicit and tacit knowledge and allow the sharing of knowledge with customers and partners."

The study also highlighted that organizations would have to be increasingly knowledgeable about world markets as financial affairs and interconnections between seemingly independent events may have a dramatic effect on their business.

Interestingly, as the developing and emerging nations grow economically strong in the global business arena, immigrants would choose to stay in or go back to their own countries and could lead to shrinking of workforce in the Western world.

Usiminas to spend USD 150 million to double J Mendes output

BNamericas reported that Brazilian integrated steel group Usiminas has budgeted USD 150 million to expand its newly acquired iron ore producer J Mendes' capacity from roughly 6 million tonne per year to 11 to 13 million tonne per year within three years.

Mr Paulo Penido Pinto Marques CFO of Usiminas said that the company is also considering a further USD 600 million investment to build a new concentrator for J Mendes to expand capacity to some 29 million tonnes per year by roughly 2012-2013.

According to Mr Marques, Usiminas has been also mulling the creation of a palletizing plant for J Mendes in roughly 2014-2015 that would require an investment of up to USD 1 billion, but the project is merely being considered and there are no concrete plans. He said that "There is no decision about this at this point in time.”

He added that Usiminas is budgeting USD 1.25 billion in expenditures for this year, not including the money to be spent on J Mendes.

Usiminas acquired Minas Gerais based J Mendes in a USD 935 million purchase of three iron ore miners, which also included Somisa and Global Mineraçao in early February.

ArcelorMittal South Africa to raise prices by 18% to 19%

Bloomberg reported that ArcelorMittal South Africa planning to raise its prices by an average of 18% to 19% in May, the fourth successive monthly increase. As per report, ArcelorMittal South Africa lifted average prices as much as 10% in February, 12% in March and plans a 15% to 25% increase in April.

The base price of all the company’s flat and long products would increase on average by ZAR 1,200 per tonne, except for two products the galvanized 0.3mmx762mm, which would increase by ZAR 2,366 per tonne and galvanized 0.3mmx914mm, which would go up by ZAR 2,134 per tonne.

Mr Tami Didiza a spokesman for ArcelorMittal South Africa said that “We have in the past month seen continued upward movement of steel prices on world markets.” He added that there is a substantial gap between international and local prices.

According to Metal Bulletin, while ArcelorMittal South Africa charges USD 880 a tonne for benchmark hot rolled coil, prices in the US are USD 920 a tonne and as much as USD 1,000 a tonne in Europe.

Incidentally ArcelorMittal South Africa is appealing a ZAR 691.8 million (USD 86 million) penalty imposed by local antitrust regulators for excessive pricing.

Only deep recession will end high oil prices – GES

According to London based Centre for Global Energy Studies’ monthly oil report dated March 17th 2008, only a deep recession leading to a slowdown in Asian growth will end high oil prices.

The report said that "What needs to happen to bring about a significant weakening in oil prices is a recession in key oil consuming economies, a slowing up of the Chinese economy, more non OPEC supplies and an acknowledgement by Saudi Arabia that the oil market should be supplied with more oil."

The CGES also said that "OPEC appears determined to follow a high price policy, keeping a tight rein on production and although the world needs more oil from the OPEC countries, there is no sign they are willing to supply it."

The CGES said that that OPEC is apparently concerned that over-supply in a weakening market will undermine prices, ignoring the argument that under supply will continue to push prices to levels that will hasten the weakening of the market and erode demand. It added that "OPEC's focus on oil supply in the OECD and the US in particular, is flawed because it is only looking at part of the market and the less important part in terms of demand growth when it takes its output decisions."

The research study predicts that OECD demand for crude oil will fall by some 330,000 barrel per day over the course of 2008 and will continue to drop by 310,000 barrels per day over the course of 2009. In the developing world, oil demand growth is expected to be moderate, at 2.5% or 930,000 barrel per day.

Outokumpu shares gain on ArcelorMittal Speculation

Bloomberg reported that Outokumpu Oyj rose in Helsinki trading last weekend on speculation ArcelorMittal wants to acquire the Finnish government's stake in the world's fourth biggest stainless steel maker.

According to the report, Outokumpu gained EUR 85 cents or 3.1% to EUR 28.67 in the Finnish capital, when excluding the EUR 1.2 dividend the steelmaker paid.

Mr Erkki Vesola an analyst at eQ Bank who has a reduce holding on the stock said that “The Finnish government may be considering selling its stake but I don't see the logic of a deal with ArcelorMittal as it would most likely be blocked by the authorities. I don't see anything solid behind this rumor.''

The country's parliament passed amendments allowing the government to sell more shares in state owned companies, broadcaster
Ms Paivi Lindqvist a spokeswoman of Outokumpu and Ms Nicola Davidson a London based spokeswoman for ArcelorMittal declined to comment.

Nucor to ramp up production in Seattle

Charlotte Business Journal reported that Nucor Corp of Charlotte is ramping up its steel production in Seattle. As per report Nucor Steel Seattle Inc is trying to keep up with demand for reinforcing steel in the Northwest, which has surged in recent months as Asian imports have slowed and commercial construction has continued at a strong pace.

Mr Matt Lyons general manager of Nucor said that the company recently received air quality permits to expand the plant's production 37% to 1.1 million tonnes per year. He added that further expansion is possible, depending on demand. He further added that the pending increase in production won't add any jobs at the 291 employee mill, but a boost to full capacity could add 20 workers.

Nucor is one of the US's largest steel manufacturers its Seattle mini mill turns scrap steel into products for the construction industry, including reinforcing bar.

Striking miners at BHPB Cerro Matoso to end action

Reuters reported that unionized workers at Colombia's Cerro Matoso ferronickel mine accepted a company offer on Sunday to end a four week strike, which began on February 27th 2008.

Mr Roger Herrera president of Sintracerramatoso union said that an assembly voted to lift the protest at the mine and the strike will officially end when commissions from the company and union sign an accord. He told Reuters "We now have authorization to lift the strike.”

Mr Herrera adding that BHPB has offered to address union concerns over contracting employees and replacing workers. He said an agreement should be signed late on Sunday and estimated miners should return to work during Monday.

Cerro Matoso produces around 4% of the world's supply nickel. Cerro Matoso produces around 55,000 tonnes a year of ferronickel in a global nickel market, which has around 1.3 million to 1.5 million tonnes.

BHP Billiton, which operates the mine in northern Colombian province of Cordoba, had declared force majeure on Friday on nickel deliveries from Cerro Matoso because of the dispute mainly over the contracting of workers.

CSC board approves 5 major projects

During the 5th meeting of the 13th board of directors of China Steel Corporation held on March 19th 2008 at Kaohsiung following major projects were approved

1. Revamp of No 1 hot strip mill
“In order to develop high strength and high grade steels, CSC will revamp and remold its No.1 hot strip mill. The project will commence in April 2008 and is scheduled for completion in June 2012. In addition to the improvement equipment functions, this project will be able to increase 230,000 tonnes of hot rolled steel products annually.”

2. Setup of the Steel Material Logistics Center
“CSC has begun to push its Double 2000 Project since December 2006. It will invest TWD 200 billion within five years to increase CSC Group’s annual production up to 20 million tonnes. In the coming future, the salable volume of steel products will be largely increased and will cause the storage capacity of CSC’s warehouse inadequate. Since the available land in CSC’s plant site has been saturated, CSC needs to find a suitable place to set up a logistics center for storing its steel products. After scrupulous evaluation, CSC has selected a land of 34 acres at the Sin Yuan Ranch of Taiwan Sugar Corporation, Lujhu Township, Kaohsiung County. CSC plans to build eight warehouses six for storing steel products and two for spare parts. The project will commence in April 2008 and is scheduled for completion in March 2011.”

3. Addition of unit No 10 at the oxygen plant
“The oxygen plant provides blast furnaces and basic oxygen furnaces with needed oxygen for making molten iron and liquid steel. Since No 1 and 4 blast furnaces will enlarge their furnace shells and inner volumes when completing their campaign revamps in 2011 and 2013 respectively, CSC has to invest to build an additional unit No.10 at the oxygen plant with capacity of 1,500 tonnes of oxygen per day for sufficiently providing the blast furnaces. The project will commence in April 2008 and is scheduled for completion in July 2012.”

4. Revamp of hot stoves 11 to 13 and peripheral equipments on No 1 blast furnace
“When this project completes, No 1 blast furnace will be able to increase the efficient and high quality hot blast by lap parallel operation with other four additional hot stoves which has been completed since October 2006. This project will be conducive to the increase of molten iron production, the increase of pulverized coal injection volume, saving the consumption of coking coal and reducing air pollution. Other benefits include:
A. To reduce the purchase of natural gas owing to the use of self-produced low heat value blast furnace gas, downstream production lines may use the high heat value coke oven gas
B. To meet our commitment for reducing CO2 emission
C. To save energy and reduce waste.
The project will commence in April 2008 and is scheduled for completion in March 2012.”

5. Purchase of land and buildings of China Prosperity Development Corporation
“CSC is currently building a No 3 cold rolling line for satisfying the market needs of high-grade cold rolled products, enlarging the market share. Since the target land of China Prosperity Development Corporation is located at No 6, Mau Da Street bearing the concave corner site of No 3 cold rolling line, CSC purchases it for bettering the vehicles traffic, as well as for combining the land to shape a complete site and suitable area for No. 3 cold rolling line.”

RMDAS ferrous scrap pricing climbs back in March

Recycling today recently reported that after a slight downturn in February 2008, prices paid for ferrous scrap moved back up in March 2008. As per report mills paid from USD 7 to USD 33 more per ton for scrap, depending on the grade and region and Shredded Scrap hit USD 400 per ton in the North Midwest Region.

Reported regional aggregated spot market prices compiled by Management Science Associates, Pittsburgh through its Raw Material Data Aggregation Service showed that mills paid in a range of from USD 418 to USD 435 per ton for the new production scrap used to define the Raw Material Data Aggregation Service Prompt Industrial Composite grade.

Regionally, the South showed the least volatility in March, with mills on average paying just from USD 7 to USD 11 per ton for their scrap, depending on the grade. In the North Midwest region prices jumped the most, moving up from USD 22 to USD 33, depending on the grade.

Steelmaking continues to be a growth industry, with figures compiled by the International Iron and Steel Institute for February 2008 steel production showing growth 5.3% YoY growth over February 2007. The 66 nations reporting to the IISI churned out some 107 million metric tons of products in February.

However, a moving annual total growth rate calculated by the institute has shown a slowdown from a peak in March 2007 of 10.8% to 6.2% for early this year. In particular, China’s moving annual total growth rate has slowed from 21% in February 2007 to 12.1% in February 2008. A slower growth rate may finally ease some of the pressure on ferrous scrap supplies and help the market achieve something closer to equilibrium. A question remaining, however, is whether the ongoing global production of so much steel will require a lengthy time horizon for scrap supply to begin reaching a point where buyers do not feel strained to obtain adequate supply.

A shredder operator in Texas said that for now, looking for supply and keeping up with demand continue to make the world seem like a busy place for scrap recyclers. “We’ve got a lot going on and we’re short-handed.”

The Raw Material Data Aggregation Service Ferrous Scrap Price Index is based on data gathered from a statistically significant compilation of verified ferrous scrap purchase transactions.

Europe's most polluted area is German steel and coal belt

According to a new report by Bremen University scientists published in the journal Atmospheric Chemistry and Physics Discussion, a strip of land between Amsterdam and Frankfurt, home to the Germany’s steel and coal industries clam the continent's most polluted area.

According to the journal this small region of Western Germany has Europe's highest concentration of carbon dioxide in the atmosphere.

As reported in Deutsche Welle, the scientists used a novel technology called SCIAMACHY (Scanning Imaging Absorption Spectrometer for Atmospheric Cartography), to detect levels of atmospheric carbon dioxide. The unique device was built by the German Aerospace Center and has been in orbit on a satellite around the Earth since 2002.

SCIAMACHY is able to detect carbon dioxide by measuring the amount of sunlight reflected from the atmosphere; different gases reflect light differently so the scientists were able to accurately pinpoint carbon dioxide's signal.

Iron ore shortage may turn to glut in next decade - Analyst

AAP reported a global glut of iron ore may be expected next decade as supply could exceed demand.

Mr Alan Heap managing director of Citi Investment Research during a conference in Perth said that “Next decade, large surpluses are looming as supply exceeds even our bullish expectations for demand.”

Mr Heap said that the iron ore market would remain tight throughout 2008, supporting another price rise next year in addition to the expected 65% hike expected this year.

He said that Australia’s iron ore exports are expected to reach 450 million tonnes by 2010 and 700 million tonnes by 2014. He added that “There is potential to exceed forecasts if projects go ahead as planned.”

Venezuela to cut coal exports in 2008

Reuters reported that coal exports from Venezuela in 2008 could fall because of government moves to take greater control of the industry. Venezuela has replaced marketing and mine management and staff, canceled export contracts and taken other steps to tighten control since mid 2007 as the OPEC nation moves to nationalize strategic sectors of the economy.

US analysts and traders said that the cut in Venezuela's premium grade coal exports would come as the world runs short of coal, prices skyrocket and buyers scramble for supply. A US based veteran coal industry analyst said that "It is creating uncertainty and increasing the risk for buyers, so I think people are reluctant to depend on Venezuelan coal.”

The analyst said that Venezuelan exports were expected to grow about 700,000 tonnes this year but expansion plans will falter as government measures discourage private investors and drive out skilled managers and staff. In addition, as much as half of the 1.2 million tonnes of coal shipped through Venezuelan ports from eastern Colombia is at risk because of government takeover moves and tensions between Venezuela and Colombia.

The expert said that surging demand and soaring prices provided motivation for the Venezuelan government's moves. Venezuelan coal, a premium grade, was going for USD 60 a tonne last year but prices of coal shipped to Europe this year have doubled that.

Venezuela exported 8.2 million tonnes of coal last year, including the coal from eastern Colombia, the analyst said. Annual world seaborne coal trade totals about 850 million tonnes out of more than 5 billion tonnes produced.

Metso to supply equipment to Anglo American in Chile

Metso Minerals announced that it will supply crushing and grinding equipment to Anglo American for the Los Bronces development project in Chile. The delivery will be completed by the end of year 2010. The value of the order is approximately EUR 12 million.

The order comprises a primary gyratory crusher, two tertiary cone crushers and three grinding mills. The equipment will be placed in a processing plant at the Andes Mountains 3,500 meters above sea level. Once in full operation, the plant is capable of processing 87,000 tonnes of copper ore daily. The order also includes start up and commissioning services.

Anglo American is a global leader in mining and natural resources. The company is listed in the Johannesburg Securities Exchange, the London Stock Exchange and NASDAQ and its net sales in 2007 were some EUR 24 billion.

Metso is a global engineering and technology corporation with 2007 net sales of approximately EUR 6 billion. It’s almost 27,000 employees in approximately 50 countries serve customers in the pulp and paper industry, rock and minerals processing, the energy industry and selected other industries.

Riva Group to build galvanized line

Yieh reported that Italian Riva Group announced to invest EUR 100 million to build a hot dip galvanized steel mill which located at Novi Ligure in north Italy.

The new mill will adopt high technologic equipments and is expected to enter production in November 2009. The width of new production will be more than 1,600mm, can be utilize in auto industry.

In order to secure the material supply, Riva also plan to build up a cold rolled production line in Novi Ligure to increase the capacity by 25% to 2.35 million tonnes.

(Sourced from Yieh.com)

ArcelorMittal’s Maputo mill resumes production after 10 years

Africa news reported that Maputo's steel rolling mill, paralyzed for almost a decade, has resumed production, though on an experimental basis.

Mr Antonio Fernando minister of industry and trade visited the rolling mill and declared his satisfaction at the resumption of activities. He said that "I saw that the factory is producing on an experimental basis, and there's a guarantee that next month it will be formally inaugurated.”

Mr Jose Marques director of Maputo's steel said that the company would produce 35,000 tonnes of steel a year, mostly rebars.

Mill owners ArcelorMittal, has promised to invest USD 11 million in the mill in addition to the purchase price of the once state owned enterprise.

Man killed in accident at Bannet Steel in Sapulpa

AP reported that a 23 year old man was killed in an industrial accident at Bennett Steel in Sapulpa city in Creek County and Tulsa County, of Oklahoma State in US.

Creek County Sheriff's Corporal Allen Harwood said Mr Elmer Crane was announced dead yesterday at a Tulsa hospital, where he was flown after the incident at Bennett Steel.

The Sheriff said that Mr Crane was trying to hook a boom dolly to a crane when the dolly he was standing on rolled out from under him, trapping him between the two pieces of machinery.

Mr Harwood said that the death is being investigated as an accident.

Pig iron import prices in SEA keep soaring

It is report that the import price of pig iron in East Asia has reached USD 660 to USD 670 per tonne on CNF basis.

Currently, the import price of pig iron in East Asia is at USD 630 per tonne and the Japan’s Nippon Steel Corp’s import price is around USD 620 per tonne.

The main reason for the price rise is because of strong demands in global market and soaring operating costs.

(Sourced from Yieh.com)

Tung Ho Steel raises H beam price for the second times

Taiwan’s Tung Ho Steel announces to raise its H beam prices by TWD 1,700 per tonne for big size and TWD 1,900 per tonne for small size. This is the second time that the mill raises H beam price in March since it raised the price by TWD 2,500 to TWD 2,800 per tonne at the beginning of March.

As a result, the benchmark price is now increased to TWD 31,200 to TWD 31,400 per tonne from TWD 29,500 per tonne and the actual deal prices are made between TWD 30,900 and TWD 31,100 per tonne.

Additionally, Tung Ho Steel also hiked its surcharge by TWD 500 per tonne as the international scrap price kept rising during past month, up by more than USD 100 per tonne. This is the main reason that the mill raises H beam price.

French government fighting to keep ArcelorMittal steel jobs

Reuters reported that France will do all it can to save jobs at a threatened ArcelorMittal steel plant and partners may be interested in keeping it open.

Ms Christine Lagarde economy minister of France said that "Our main aim is to maintain employment to ensure people keep their jobs. There could be some partners interested.”

Plans for a partial shutdown of the Gandrange steel factory in eastern France were postponed this year after Mr Nicolas Sarkozy president of France urged owner Mr LN Mittal to reconsider.

But unions said on Sunday the company had made up its mind to shut down part of the factory with the loss of 595 out of 1,100 jobs. They said they had been notified that these plans would be announced to staff at a works meeting on Friday.

Joseph Smith to expand scrap export market

US based Joseph Smith & Sons Inc will open a bulk cargo terminal in order to expand its export market of ferrous scrap.

By establishing a joint venture with European Metal Recycling, Smith will have the capability to handle though the new deepwater terminal. And this will make Smith the first company to ship ferrous scrap loaded in bulk cargo in Baltimore, while other processor in that region ship in containers.

Due to the recent depreciation of US dollar, it will be helpful for US scrap handlers to expand their overseas markets.

(Sourced from YIEH.com)

Brazilian steel firms in good shape for fundraising – Analyst

With bulky investments planned for the coming years, Brazilian firms in the mining and steelmaking businesses will have to go fundraising to finance expansion and purchases at a moment of significant volatility in global financial markets. Analysts however believe that strong cash generation and low indebtedness will protect domestic miners and steelmakers from the credit crunch caused by financial turmoil.

Evidence of that is that Vale, the world's second largest mining group and biggest iron ore producer, has secured a USD 50 billion loan from a group of foreign banks led by HSBC, Banco Santander Central Hispano, BNP Paribas, Lehman Brothers, Credit Suisse and Citigroup for the acquisition of Anglo Swiss miner Xstrata.

Steel producer Usiminas has also circumvented scarce liquidity by taking out a USD 1.3 billion loan from overseas banks to pay for the purchase of the miner J Mendes. Usiminas has recently completed a BRR 500 million (USD 286 million), five year debenture issue, which was mostly subscribed to by investment funds and private pension funds.

Mr Carlos Kochenborger an analyst with local brokerage firm Corretora Geração Futuro believes that the slowdown in the US economy will not have much of an impact on the mining and steelmaking sectors because emerging countries like China and India have shown very strong demand for steel for domestic urbanization and infrastructure projects. He added that "Growth is expected to slow but not stop altogether.”

10 things one should know about nuclear power plants

1. Nuclear power plants provide about 17% of the world's electricity. France uses nuclear power to generate around 80% of its electricity needs.

2. According to the IAEA, as of 2007, there are around 439 nuclear power plants around the world.

3. A new 1,000 MW nuclear power plant would cost around USD 2 billion and take five years to build. By contrast, a new 1,000 MW pulverized coal plant would cost USD 1.2 billion and take three to four years to build.

4. All nuclear power plants are designed for a finite period, of around 60 years. After this, they have to be decommissioned, decontaminated and demolished so that the site is made available for other uses.

5. The first man made reactor was made in the United States, known as Chicago Pile 1, which achieved criticality on December 2nd 1942. The world's first commercial nuclear power station, Calder Hall in England was opened in 1956 with an initial capacity of 50 MW.

6. Russia has begun building floating nuclear power plants. The USD 205 million vessel, the Lomonosov to be completed in 2010, is the first of seven plants that Moscow says will bring vital energy resources to remote Russian regions.

7. The world's most famous nuclear power station is not in Chernobyl, or Three Mile Island. It is the Springfield Nuclear Power Plant, owned by Montgomery Burns and workplace of Homer Simpson.

8. The death toll during the Chernobyl disaster in Russia includes the 50 workers who died of acute radiation syndrome and nine children who died from thyroid cancer. An estimated 4,000 people are expected to die from cancer-related illness.

9. In Europe, there are 400,000 people employed in nuclear power plants.

10. Australia's uranium reserves are the world's largest, with 24% of the total. Production and exports average about 10,000 tonnes of uranium oxide per year.

Wyoming rejects Cordero USD 44 million bid for coal lease

It is reported that for the second time in six months, the federal Bureau of Land Management Wyoming State Office has rejected a bid from Cordero Mining Co seeking to lease additional coal adjacent to its Powder River Basin mining operations.

Cordero a subsidiary of Rio Tinto Energy America bid USD 43.79 million for the North Maysdorf Tract, a 446 acre tract containing an estimated 54.7 million tonnes of mine able coal. The coal tract is located near the existing Cordero Mine about 15 miles south of Gillette.

Although Cordero’s latest bid was more than double its previous bid, but Bureau of Land Management said it did not meet or exceed Bureau of Land Management's estimated fair market value of the coal.

Mr Larry Claypool acting deputy state director for minerals and lands said that “Bureau of Land Management received only one bid for the tract and after reviewing the bid, we determined that it could not be accepted because it did not meet the estimated fair market value.”

In October, Bureau of Land Management rejected Cordero’s bid of USD 21 million for the North Maysdorf Tract. In November, it rejected the Rio Tinto subsidiary’s bid of USD 122 million for the larger South Maysdorf Tract, which contains an estimated 288 million tons of coal. In both instances, Bureau of Land Management said the bids did not meet fair market value.

Global coal use to rocket 73% by 2030 – Mr Kemm

According to Mr Kelvin Kemm CEO of business strategy consultancy Stratek global coal use will rocket by 73% by 2030, with the world's overall energy needs rising by over 50% during that period.

Mr Kemm during a conference in Johannesburg, citing International Energy Agency figures said that in 2005, coal's total share of the energy mix was 25%, but this would rise to 28% over 25 years and by 2030, global oil demand will swell to 116 million barrels a day.

Mr Kemm said that emerging economies including India and China were driving up demand for energy and other commodities, with both of their economies growing at some 10% a year. He said that South Africa, government and State owned power utility Eskom have blamed the country's power crisis on low stockpiles and poor quality of its coal supply, which it uses to produce nearly 95% of its power output.

He added that since then, the utility has said that it aimed to procure an additional 45 million tonnes of the fuel in the near term.

AGE expects rise in coal imports

A coal importer controlled by the Kok Huad Group of the Kuansataporn family Asia Green Energy Co in Thailand expects bituminous coal import sales to rise at least 50% this year to 1.56 billion baht. It also expects coal trading revenue to grow by 40% in the year ahead/

It signed a coal purchasing contract last week with CIF Trading Pte, an Indonesian coal mine operator and trader, for 3 million tonnes delivered from the beginning of 2008 through to 2010 from the mine in East Kalimantan. The deliveries are worth THB 7 billion in total. The contract gives the company enough coal to supply its clients within two to three months. Last month AGE signed another coal purchasing contract for 1.5 million tonnes.

Mr Panom Kuansataporn MD of AGE said that the group decided to shift from biomass as the market has been saturated for the past few years and suffers from raw material constraints. He said that “AGE is Thailand's fourth largest coal importer. It has a market share of 2%; Banpu, Lanna group and Unique Mining together import about 98% of the country's coal.”

Since 2004, the group has diversified away from biomass, in which it has 40 years of experience, into coal trading managed via wholly owned AGE.

USW call on Nova Scotia to change Trenton works trustee

It is reported that members of the United Steelworkers are calling and visiting their MLAs and have even met with the premier to convince the Nova Scotia government to get rid of Ernst and Young as the trustee for the bankrupt Trenton Works.

Ms Marie Kelly assistant director of USW Ontario in Atlantic said that "Our union and the province are the only two main creditors. A creditors' meeting is scheduled for March 31 and the government must show that it supports communities like Trenton, whose major employer was allowed to slide into bankruptcy by its US owner, the profitable Greenbrier Companies.”

Ms Kelly said that "Based on past experience with Ernst and Young over the demise of Sydney Steel, we have no confidence in this company to do the right thing by the community or workers. We need to be sure that our claims will be dealt with."

She added that there are 39 former office and technical employees owed severance amounting to USD 1.5 million, a pension shortfall of USD 6.8 million and a benefit shortfall of USD 157,000. The province, through a loan guarantee is owed USD 8.8 million.

Ms Kelly said that "Something smells when it appears that all other creditors appear to have been paid before the company went into bankruptcy. There needs to be an inquiry by a trustee that hasn't been involved to date and one that can come into the situation in a neutral position to determine whether something inappropriate has occurred. The government of Nova Scotia owes to its citizens every effort to support communities and jobs. We want the province to join with us as full partners in the search and recruitment of a new buyer for TrentonWorks.

She added that "For us, the real bottom line is that we want the plant to be purchased and production started up with a plan to employ as many workers as possible for the long term."

Zambian opposition urges cancellation of mine taxes – Report

The Saturday Post reported that Zambia's opposition Patriotic Front party urged the government to abandon planned windfall and variable profit taxes for the mining industry because of the impact they may have on employment.

The newspaper cited Mr Michael Sata leader of Patriotic Front party as saying that the proposed tax regime may place current jobs at risk and threaten future expansion plans by mining companies.

The newspaper said that Mr Ng'andu Magande finance minister challenged the Patriotic Front to hold rallies in Zambia's copper rich northern region to explain how the new tax regime will affect the companies. He said that lawmakers have rejected proposals by mining companies to change the proposed taxes, which become effective on April 1.

Dr Tuwairqi calls for formation of Arab Steel JV

Arab Steel reported that Dr Hilal Al-Tuwairqi chairman of the board of Tuwairqi Group in Saudi Arabia has announced establishment of a joint Arab company in the iron and steel field, which will be as an alliance between the steel producers in the Arab countries with the objective to reach a huge production which will meet the needs of the domestic market and be able to compete in the world markets.

He said that this company will provide a good opportunity for investing the raw materials available in a number of the Arab countries like Mauritania, Algeria and the Sudan. Dr Tuwairqi suggested to nominate this company as Arab Steel.

This was mentioned in the speech delivered by Dr Tuwairqi before the participants in the 8th International Arab Iron and Steel Conference for which he chose the title " Alliances in the steel industry : Towards a vision for a joint Arab business in this industry". Dr Tuwairqi said that that this company comes within an Arab alliance between several Arab companies from the private sector and it is open for whoever wants to join it.”

Dr Tuwairqi also called for encouraging investment in the steel industry pointing to the Arab region which is considered the best place for investment in this industry.

Dr Tuwairqi also declared getting the approval to establish an Arab specialist university which allows the Arab youth to get high certificates in the iron and steel specializations, assuring that the private sector holds the responsibility for creating employments for the Arab youth.

Gadani ship breaking yard losing workers to cities

The News reported that Pakistan’s Gadani ship breaking yard, which was a thriving industry in the 1980’s and provided jobs to thousands of people directly or indirectly, is facing migration of labors to other sectors.

As per report, there was a time when the yard was a booming market where thousands worked but now the number of workers has reduced due to a slump in the industry over time and as such these workers prefer to work in cities.

The report cited a worker as saying that "The moment workers get an idea of a better working environment, they leave this field and start working in cities where they get safer work on higher wages. There were many incentives for workers at Gadani in the 1980’s, but all that charm has come down with the industry, to disappointing levels. Earlier, the employers were very kind to workers and would hire laborers for the complete year or so, and now it has come down to just 15 days at one stretch."

Some workers said that their duty hours are fair enough as they work 8 hours a day, but what they think is vulnerable, is their life. Accidental blasts and wounds are the potential threats to a worker’s life, which is where the authorities must step in and consult ship breakers and workers to help prevent such accidents.

One of the major problems that workers face is the lack of interest from their employers towards health hazards and life threatening risks to workers. Workers are helpless as they have limited options to earn a living, which usually draws them to work under severe conditions, that sometimes leads to fatal accidents.

Apart from the health of the ship yard workers, in recent years, ship breaking has also become an issue of a major environmental concern. Many ship breaking yards in developing nations have a mild environmental law, enabling large quantities of highly toxic materials to escape into the environment, causing serious health problems among ship breakers, the local population and the wildlife.

Hyundai secures major construction contract in Qutar

Arabian Business reported that South Korea's Hyundai Engineering & Construction Company has received contracts worth QAR 1.9 billion to build power generation facilities.

One of the contracts is worth USD 201 million and will involve the construction of seven substations in 30 months, while the other is a USD 100 million power cabling deal, to be carried out over 23 months.

The deal brings the total value of Hyundai’s orders in the Middle East and Singapore so far this year to US 1.5 billion. Among its power projects in the UAE are the USD 700 million deal, awarded by DEWA in March 2006, for the construction of the ‘L' power station in Jebel Ali.

Hyundai is also working on a US 1.5 billion turnkey dredging contract in consortium with Archirodon Construction (Overseas) and Boskalis Westminster Middle East for the Khalifa Port and Industrial Zone, Abu Dhabi's new multi billion dollar commercial and industrial port development.

In December 2007, Hyundai won a USD 680 million contract from the Libyan government to build a power plant near Tripoli.

UAE looking for new avenues to hire construction workers

It is reported that UAE and other Gulf countries, which are facing acute shortage of workers, are looking at countries like Bangladesh and Nepal to get laborers needed to complete mega projects worth a whopping USD 1.9 trillion. According to a study by the Project Management Institute, construction projects in the GCC planned for the next 2 years would require 5 million workers.

In the past, the majority of the semi and unskilled construction workers were from India, but the number is dwindling since construction industry in India is growing rapidly and with the increasing value of rupee against the dirham, companies are finding it difficult to convince recruits from India to take up jobs in the Gulf.

Recruitment agencies in the GCC are tapping into new labor markets, including Bangladesh, Nepal and Vietnam, in an effort to solve the problem. Recruitment of workers from Bangladesh has increased by 100 percent compared to previous years, with more workers from the country coming to the UAE during the first two months of 2008 than the whole of 2007.

Mr Majeed Al Gassab president of Bahrain Society of Engineers and also VP of the Bahrain’s PMI chapter said that the movement of workers away from the GCC has already started and immediate measures have to be put in place to retain remaining staff and find new sources for recruitment. He added that it is evident skilled workers are already moving out of the Gulf for better opportunities and it will be a great risk to carry on with inexperienced laborers.

Mr Mohammad Jindran of Sharjah based Overseas Labor Supply said that there has been a severe drop of interest from Indian construction workers. We do not like to go to India for selection anymore as we only manage to get 30% of our requirement. India and Egypt remain the major exporters of professionals to the Arab world. So the manpower shortage here could be serious with the former two countries witnessing a boom.

China to help Pakistan in building hydro project

Pakistan is expected to soon conclude reinsurance deals with a Chinese consortium for the strategically important Neelam Jhelum hydro electric project being built by it at a cost of USD 1.5 billion in Pakistan occupied Kashmir.

A senior executive of Pakistan based insurer Adamjee Insurance Company said that "The talks are in very advanced stages and close of the deal is expected by April end 2008 or early May 2008."

Turkey announces tender for first nuclear power plant

Turkey has announced a tender for the construction of its first nuclear power plant, to be built near Akkuyu Bay on the Mediterranean coast. Bids will be accepted from local and foreign companies as well as JVs until September 24th 2008. Mr Hilmi Guler energy minister of Turkey said that "We are officially launching a tender. I hope we will assess the bids here in 6 months."

It may be noted that Turkish authorities planned to build a nuclear power plant in Akkuyu in 2000, but the plans were canceled due to financial problems and protests from environmentalists who said the plant would be located in a seismically unstable area.

In November 2007, Turkey enforced a law on building and running nuclear power plants. Under it, potential builders will hold legal responsibility for transporting radioactive materials and waste, as well as for any mishaps caused by negligence.

Turkey plans to build 3 nuclear power plants at a cost of USD 7 to USD 8 billion by 2016. They will have an aggregate capacity of around 5,000MW and are expected to use pressurized heavy water reactors.

DII inks agreement with Gaussin for manufacturing plant

Dubai Investments has entered into a partnership agreement with France based Gaussin SA through its industrial arm Dubai Investments Industries to set up a manufacturing plant in Dubai. Mr Shukri Al Mehairi GM of Dubai Investments Industries and Mr Christophe Gaussin chairman of Gaussin have signed the agreement in Dubai recently.

The new JV is to set up a large scale production facility at an estimated cost of AED 130 million in Dubai Investments Park to design and manufacture industrial and port trailers as well as self propelled industrial vehicles. The production facility is under construction in a large plot of land at DIP and will be operational in the second quarter of 2009. It will be capable of designing and manufacturing a wide range of port and industrial trailers as well as automated guided vehicles.

Mr Al Mehairi said that Dubai Investments has worked in tandem with Gaussin for over 8 months to investigate and determine the feasibility of the investment and to iron out every detail of the partnership. He added that "We are happy to be associated with Gaussin in establishing the first specialized trailers and industrial vehicles manufacturing unit in the UAE and in the region. We believe that the winning combination of Dubai Investments’ intricate knowledge of the Middle East region and Gaussin’s expertise in the business as a market leader across the globe will take this venture to great heights and contribute in a large way to the growth of the local economy. This JV also underscores the importance of cooperation between the corporate sectors of UAE and France."

Gaussin SA is a listed company in the Paris stock exchange and has been involved in the design and manufacture of handling trailers for over 50 years with a client base stretching across diversified industries including ports and airports, aerospace, automotive, steel, petro chemical and other heavy industries.

DII, the green field project development arm of Dubai Investments has made a name for itself with a number of successful subsidiaries operating in the UAE.

Muscat rules out plans for coal fired power plants

It is reported that Muscat has ruled out using coal as the fuel for its next independent water & power project and launched a fresh study into the fuel to be used for future plants.

Bidders for the advisory contracts on the project known as Barka III were initially told they could be asked to study the possibility of the plant being coal fired. But with the 700 MW and 26 million gallon a day plant due to come on line in 2011, Oman Power & Water Procurement Company has abandoned the idea.

Official of Oman Power & Water Procurement Company said that "There was an optional scope in the tender, but we are not intending to exercise that. The time limit does not allow that. We have decided to carry out a proper study before moving into coal or any other source of fuel."

The objective of the study is to provide a long term solution to the challenge of securing gas feedstock for future projects. OPWP currently uses sweet natural gas to fire its plants and the study will evaluate the feasibility of using different fuels.

In December 2007, the Oman Tender Board announced that the legal consultancy contract for Barka III had been awarded to the UK's Berwin Leighton Paisner and Switzerland's Electrowatt Engineering Services had won the technical advisory contract. Both companies have yet to sign a contract, although the reason for the delay is unclear.

Qatar GDP surged by 12% in 2007 to QAR 232 billion

Gulf Times reported that Qatar's gross domestic product at current prices grew up by 12% to QAR 232 billion in 2007.

Qatar’s planning ministry said the third quarter accelerated to 12.5%, spurred by its energy industry.

Qatar is the world's largest producer of natural gas that is cooled to a liquid for export by ship. It also produces oil.

Qatar power output up by 37% after start of new plant

Doha Times reported that Qatar Power has successfully completed Ras Laffan B integrated water & power plant in Ras Laffan. The USD 1 billion project is the biggest water and electricity production plant in Qatar.

With the commissioning of the Ras Laffan B integrated water & power plant, the electricity generation in Qatar has gone up from the previous 2,712 MW to 3,737 MW. This amounts to a rise of about 37% in electricity generation.

Similarly, there has been an additional generation of 47% in the water generation with the complete commissioning of the new plant. While only 127 million imperial gallons per day water was available for consumption earlier, the figure rose to 187 million imperial gallons per day with the opening of the new plant.

Mr Abdullah bin Hamad al Attiyah deputy prime minister and also minister of energy & industry of Qatar said that "With the commissioning of new plants in Mesaieed and Ras Abu Fontas in the next 3 years, power generation would exceed 9,000 MW. Similarly, the quantum of water available would be more than double in 2011 with the completion of projects in Ras Abu Fontas. Not less than 400 million imperial gallons per day of water would be available for consumption in the country with their commissioning."

Danube eyes USD 1 billion in sales revenue in 2008

Danube Building Materials has announced that it is aiming to generate AED 1 billion in sales revenues by the end of 2008. With a 72% growth in its annual earnings in 2007, it has projected that it could double its annual returns to hit the AED 2 billion mark by the end of 2010, based on the current uptrend in its overall growth and amidst the rapid expansion of the construction industry in the region.

Mr Rizwan Sajan chairman of Danube said that "Its outstanding growth has been the result of its dedicated focus on establishing facilities in high potential production locations, such as its newest factories at Lianyungang in China and in Bahrain, which supply a significant bulk of the high quality products for its regional and international clients."

Mr Sajan said that "Our vision as the leading supplier and one stop shop for total building materials is to cater to the requirements of our entire customer base, from individual homeowners to contractors and developers working on mega projects across the region. Our strategy is to maximize our inputs in the building materials sector and further boost our market position by reinforcing our regional expansion plans and further enhancing our product line, thereby enabling us to reach our sales revenue targets in the coming years."

For 2008, Danube has charted a specific action plan to target Saudi Arabia, Qatar and Kuwait where the demand for building materials is on the rise. Considering the Middle East region as the market with the most growth potential, it is keen on supplying the rising demand for key products such as steel, medium density fiber boards, laminates, timber, glass, aluminum and others.

Emaar Properties keen on Indian IPO

Emirates Business 24/7 reported that Dubai based Emaar Properties has not abandoned its plans to sell shares in its Indian subsidiary despite pulling out of an initial public offering in February 2008.

Mr Mohamed Ali Alabbar chairman of Emaar Properties said that it continued to have a long term strategy for India and saw huge potential there, despite the recent setback. He added that "India will be one of our largest operations. The economy is doing well and we see a bullish story for the next 20 to 25 years."

Mr Alabbar said that Emaar would go public in India when the time was right, since it was cash rich and could potentially double its size. He added that "Indian and Morocco operations have contributed between AED 150 million to AED 200 million to its profit and loss account in the last quarter of 2007."

Mr Alabbar also said that it is considering listing on overseas markets, particularly the NASDAQ in New York, when conditions were suitable. He added that "We have a simple problem at the moment, which is the high demand for offices and accommodation. Over the next 24 months the release of new residences will lower prices. But unfortunately the high costs are everywhere."

It may be noted that Emaar's Indian JV Emaar MGF in February 2008 withdrew its IPO due to weak investor appetite after cutting its price twice and extending its IPO by 3 days.

Nakheel inks agreement with DMCC to reduce emissions

Bahrain Tribune reported that Dubai Multi Commodities Centre and Nakheel have signed an agreement to jointly promote clean development mechanism to reduce greenhouse gas emissions in the United Arab Emirates. As per report, DMCC and its partner EcoSecurities will work with Nakheel to identify potential projects for reducing emissions and improving energy efficiency.

DMCC will facilitate the development of the clean development mechanism component of these projects, which in turn will create value by generating certified emissions reduction credits that can be traded on global carbon markets. This will enhance Dubai's position as a leading centre for carbon emissions reduction initiatives and firmly establish its place within one of the world's most rapidly growing industries.

Mr Ahmed Bin Sulayem executive chairman of DMCC said that "Energy conservation and reduction of greenhouse gas emissions are the focus areas and important for the long term environmental sustainability. The combination of DMCC's expertise in clean development mechanism project development and Nakheel's position as a world leader in innovative urban project design creates a strong partnership for ensuring these challenges are met."

Ar Razi to set up 1.7 MTPA methanol plant

The Saudi Methanol Company, also known as Ar Razi, has announced plans to launch a 1.7 million tonnes per annum methanol project in May 2008 at Al Jubail in Saudi Arabia.

This will be Ar Razi's fifth methanol unit and also one of the largest. The unit is being constructed by Mitsubishi Heavy Industries, which now operates four methanol units in Al Jubail.

Ar Razi is a 50:50 JV enterprise between Japanese Mitsubishi Gas Chemical and Saudi Basic Industries.

Iran starts tractors units in Africa

Iran Tractor Manufacturing Company has implemented a production line to manufacture Iranian made tractors in Uganda and Zimbabwe.

Mr Mohsen Arab Baghi MD of Iran Tractor said that "Having gained the required technical expertise of manufacturing various kinds of tractors, we have managed to run the production line of tractors in 5 different countries including Uganda and Zimbabwe." He added that the demand for modern high quality tractors is increasing and the company is making serious efforts to meet the demands.

Over the past year, Iran Tractors has produced 30,000 units of light and heavy tractors, out of which 10,000 have been exported to 31 countries.

Iron ore price negotiations – China denying credit for spot iron ore buying

It is reported that Chinese steel mills are worried about their iron ore inventories in coming weeks, as most of the steel mills and traders have been denied bank credit for issuing letter of credit for iron ore procurement.

The recent measure of denying credit to iron ore importers is a desperate effort to bring down the spot iron ore price, so as to enable Chinese to finalize annual contracts with Australian miners before April 1st 2008.

Although most of Chinese buyers are at a risk of insufficient iron ore inventories, they are facing unprecedented delays in issuing letter of credit for last few days.

However the reliable sources in China said that this measure will not have much impact on iron ore spot prices. Strengthening Chinese currency is also going to help Chinese mills lowering their import cost of iron ore. RMB is reported quoting at 7.04 against US Dollar, compared to a exchange rate of 7.45 in the month of January.

The battle for higher iron ore spot prices continues with Rio Tinto saying its well placed to achieve a premium price from Chinese steelmakers. Rio continues to argue its iron ore, from the Pilbara Region in Western Australia, is much cheaper to import than iron ore from other regions, such as Brazil. The company has also decided to reduce the volume of iron ore delivered to term customers, in order to maximize sales on the lucrative spot market.

Chinese plate export prices continue up surge

It is reported that export offer for Chinese steel plate has been continuously on the rise, reflecting the strength of domestic market and super strong demand in overseas countries. Besides, the increase is speeding up and as a result, there has been an additional rise of USD 100 per tonne during merely two weeks.

Mysteel said that on Shanghai market, commercial 20mm plate by Yingkou Steel is being quoted at CNY 6050 per tonne CNY 6080 per tonne, while that by tier two steel mills is tagged at CNY 5700 per tonne. Low alloyed 40mm plate has jumped to CNY 6620 per tonne. Taking price for 20mm plate by Yingkou Steel as benchmark, the short term upward target is CNY 6250 per tonne.

Export prices have seen another increase of USD 20 per tonne to USD 30 per tonne this week and some steel producers have seized the opportunity to realize substantial rise.

A North West China based steel maker is offering SS400 14mm to 25mm SS400 plate at USD 1060 per tonne CFR as base for shipments to South Korea. Whilst the quotation for CCSA/B grade ship plate has jumped to USD 1200 per tonne CFR for the same destination. But some tier two steel mills in North China are quoting at lower level of USD 980 per tonne FOB to USD 1020 per tonne FOB which is believed to catch up soon.

(Sourced from MySteel.net)

BaoSteel expects 2008 sales to rise by 4% YoY

It is reported that China's biggest steel maker Baoshan Iron & Steel Company expects sales to grow 4.4% in 2008.

Baoshan Iron & Steel Company said its revenue may reach CNY 200 billion as compared with CNY 191.6 billion in 2007.

Baoshan however waned that costs will amount to CNY 171 billion in 2008 pushing down profit by 2.7% as rising costs for raw materials such as iron ore, coal and nickel more than offset increased sales.

China's ferrosilicon exports likely to fall in 2008

Platts cited Mr Gao Xu general manager of Dragon Northwest Ferroalloy while speaking at the Metal Bulletin's 9th Asian Ferroalloys Conference in Hong Kong as saying that Ferrosilicon exports from China is expected to be cut to around 1.2 million tonnes to 1.3 million tonnes in 2008, as compared with about 1.537 million tonnes produced in 2007.

Mr Gao said ferrosilicon exports in 2008 would be pulled down by the anti dumping duties imposed by the European Union, the 25% export tariff in China and rising domestic prices of raw materials including coke and power.

He said that domestic demand for ferrosilicon in China this year would be around 3.8 million tonnes. Of the total consumption, ferrosilicon used in iron and steel industry is expected to be around 2.54 million tonnes. Mr Gao said "Consumption of ferrosilicon in the iron and steel sector in China will gradually reduce due to the use of substitutes. However, its application in magnesium production will rise. Magnesium metal production in China is expected to rise in 2008 and based on this, the consumption of ferrosilicon in the magnesium sector will reach about 910,000 tonnes."

Mr Gao also said that ferrosilicon output capacity in 2008 will raise to at least 9 million tonnes by the end of 2008, but only about 45% to 66% of the total capacity will be in operation. Output this year is set to be around 5.2 million tonnes. Ferrosilicon output in 2007 was about 4.9 million tonnes. He said that "More ferrosilicon production plants in China have increased their production scale through resource integration and joint cooperation. More new enterprises are now with a production capacity of at least 100,000 tonnes per year."

Chinese CR export prices to increase further

It is reported that export price for Chinese cold rolled steel coil is going to see another jump in the coming weeks. There is strong likelihood that export offers would increase by additional USD 50 per tonne to USD 70 per tonne in April or May 2008.

On Shanghai market, 1.0mm CR sheet by Anshan Steel is being quoted at CNY 6530 per tonne, 1.2mm to 2.0mm CR sheet at CNY 6400 per tonne. 1.0mm CR coil by Maanshan Steel goes at CNY 6350 to CNY 6380 per tonne.

As per report, expected increase in Chinese domestic market prices and the robust overseas demand are believed to be the major driver for the further rise in export quotations.

(Sourced from MySteel.net)

Chinese coke demand to hit 360 million tonnes in 2008

Interfax China reported that China's coke demand will reach approximately 360 million tonnes in 2008 despite moves to shut down small scale coking plants.

Shanghai Securities News reported the China Coking Industry Association that oversees Chinese coking plants as saying at a press conference in Beijing that China's coke consumption will reach 360 million tonnes nearly 60% of the global total estimated at 600 million tonnes.

According to the China Coking Industry Association in order to keep up with the country's growing coke demand, China commissioned an additional 20 million tonnes of coking capacity last year, with another over 50 million tonnes of capacity due to come online between 2008 and 2009. Output from such expanded capacity is expected to exceed coke demand during the period.

China coke capacity elimination campaign is making inroads into small scale plants, with 12 million tonnes of outdated coke capacity shut down in 2007. This is in line with the government's push to curb industrial pollution and excessive energy use.

China Oriental looking to buy mills with 2 million tonnes capacity

It is reported that China Oriental Group Company, a Chinese steelmaker controlled by ArcelorMittal, seeks to buy domestic steel with 2 million tonnes of capacity as part of a strategy to double production.

Mr Zhu Jun executive director of China Oriental Group Company said that the company is looking for assets in Hebei province in northern China. He said “We believe the ongoing consolidation in the nation's steel industry would offer us chances to expand.”

Mr Zhu said China Oriental in September said it plans to more than double production capacity to over 10 million tonnes by 2010. Capacity will reach 6 million tonnes by the end of this year from 4.3 million tonnes in 2007.

China Oriental Group Company produces billets, strips and H-beams. Billets are semi-processed products that can be made into strip. Strips and H-beams are used in construction.

BaoSteel sees high steel prices in H2 of 2008

It is reported that China's biggest maker of the alloy, Baoshan Steel expects steel prices to stay high in the second half as raw material costs rise and demand from automakers grows and the possibility of a steep decline in steel prices is thin in the second half.

Mr Fu Zhongzhe president of Baoshan Steel said in an online conference with investors said that “Steel prices will fluctuate within a narrow range at high levels.”

He said our automobile customers, mainly high end clients, can afford the rising prices. Baoshan may better last year's profit provided the Chinese government doesn't implement measures that will slow the economy.”

Mr Fu said China's economy has grown at more than 10% since 2003, and will likely continue growing at that pace this year.

Chinese HDG export prices remain stable

It is reported that export offers for hot dipped galvanized coil price are up again though domestic market prices are largely unchanged this week.

On Shanghai market, 1.0mm HDG by Anshan Steel is being quoted at CNY 6400 per tonne, 0.5mm by private producers at CNY 6700 per tonne last week. It is also the case with prices in Shandong's Boxing market, where 0.5mm remains at CNY 6350 per tonne, 1.0mm HDG remains at CNY 6050 per tonne.

Export offer for 1.0mm HDG is still at USD 980 per tonne FOB up by USD 20 per tonne. Most traders said that that there is little allocation for exports even at higher prices. The transactions are believed to be fairly good and some tier one steel makers have not setting the price for June shipment until end March or early April 2008.

(Sourced from MySteel.net)

Chinese coke makers to hike prices to offset cost increase

It is reported that Chinese coke companies are pushing for price advances for April productions during the price negotiation with steelmakers as cost rises have severely squeezed their profit margins.

Coke index launched by China Coking Industry Association has jumped from more than 200 points to over 300 points during late 2005 and 2006. In the meanwhile coke price has surged to CNY 1900 per tonne from CNY 800 per tonne to CNY 900 per tonne. But according to an official from China Coal & Coke Holdings Limited despite several price improvements in last year, coke industry could merely maintain a low profit level approximately 5% owing to rising prices for raw materials.

Listed companies in the industry include ShanXi Coking Company Limited, Shanxi Antai Group Company Limited, Taiyuan Chemical Industry Company Limited, Heilongjiang Heihua Company, Limited, Changchun Gas Company, Limited, Kailuan Clean Coal Company, Limited and so on. Annual reports from some companies demonstrate gross profit margin of less than 20% owing to increasing costs.

Coal price increased frequently in the first half of 2006 with monthly increment of CNY 20 per tonne to CNY 50 per tonne. As China adjusted export policy for downstream steel industry for several times in the second half, export cost for steel products jumped and the frequency of coke price hike slowed down significantly. However, the root of coke price advances, coking coal price hikes still continue. Long term contract price for coking coal has gained 20% to 30% for 2008. Increasing cost still promotes coke price improvement.

Minmetals calls for setting up Mining fund

It is reported Mr Zhou Zhongshu president of China Minmetals Corp said Chinese government should set up a metal mining development fund to help Chinese companies explore local and overseas resources.

Mr Zhou Zhongshu said capital could be raised from China Investment Corp, local banks, miners and foreign strategic investors. He said the fund should invest in domestic and overseas mining groups to establish the country's key resource reserves.

Mr Zhou said "China has made some progress in overseas resource cooperation, but it is still far from enough and is difficult for Chinese firms, which are usually small scale and lacking in capital to compete with their international rivals. He said many Chinese companies are operating independently and fail to get overseas projects because they're competing with each other.

Mr Zhou called for the government to set up an industrial fund using national and social capital to subsidize miners.

IMC adds new shipyards in China

It is reported that Tsao family’s IMC Corp is expanding its shipyard business in China with two new yards, one focusing on ship repair and another on shipbuilding.

Mr Koay Peng Yen CEO of IMC Corp said “We are expanding in the shipyard area, two ship repair yards right now and we’re building up a new building and conversion yard and a ship repair yard.”

He said that the two new Chinese yards will be in Zhoushan and Dalian Changxiang and are being developed with partners that he did not disclose. He said “We will release more information when our partners are more ready.”

Mr Koay said that the decision to enter the shipbuilding market in China given the huge number of yards coming up in the country. It depends on which segment of the market that you enter is not different even from ship repair. He did not say which segment of the new building market it was looking to enter. He added that its existing China joint venture ship repair yard in Zhoushan is full a little more than a year after starting operations.

IMC Corp was set up last year to consolidate all the shipping, industrial, offshore and logistics businesses held by Mr Fredrick Tsao’s IMC Pan Asia Alliance. IMC Corp is helmed by Mr Koay who moved from Neptune Orient Lines in mid 2006 and has since brought over a number of other senior executives from the Singapore shipping line.

Steel prices likely to stay firm in 2008

Chinese think tank forecast that steel prices will keep running on the high track in 2008 and probably continue ascending this year.

Mr Yang Jianlong in charge of industrial economy in the state council's development and research center also believes the steel industry is on an upward course. He forecast the industry is to see crest this year rebound in export and then go into periodical corrections in 2009 to 2010.

As per report coke prices and freight rate hikes and boosted by strong demand of reconstruction in snow snarl stricken areas, steel prices have been surging this year.

China wants 40% of oil and gas imports from Africa

Reuters reported that China wants up to 40% of its oil and gas imports to come from Africa in the next 5 to 10 years.

Mr Zhiming Zhao executive president of China Petroleum and Petro-Chemical Industry Association told reporters at an energy conference in Cape Town said that "We wish to increase the imports, the oil and gas from Africa from 35% to 40% in the next five to 10 years. He said that "We have a very good relationship with Africa and in future we wish to find more places to put our investments."

Mr Zhao said China had invested some 30 billion dollars in Africa's oil and gas industries.

Among the Chinese investments in Africa's oil and gas sectors, Mr Zhao mentioned Egypt where China Honghua set up a joint venture with the Egyptian Ministry of Oil to produce drilling rigs.

China National Petroleum Corp has also invested in its first overseas deep-water exploration project off the coast of Equitorial Guinea and was continuing its decade long relationship with Sudan.

Coal to remain in shortage in China during H1 of 2008

According to the Chinese ministry of commerce of, the supply and demand relation between domestic major consumer goods and producer goods would remain stable in general and market would be balanced but some commodities will be in a short supply in some areas and in some period.

Investigation results of Ministry of Commerce shows that 8 varieties among 600 consumer goods will be in a short supply in some period. 3 varieties more than that in the second half of 2007, that is pork, beef, mutton, soy bean and bean oil etc. 13 varieties among 300 producer goods will be in shortage, 2 varieties more than that in the second half 2007, such as steam coal, anthracite, coking coal, coke, diesel, gasoline, kerosene and fuel oil etc.

Ms Chen Xiuzhi a senior economist of China Logistics Information Center said that market price of producer goods remained strong at present, and the tense demand and supply relation in domestic market did not change. Therefore, the price of producer goods still kept strong in recently. And this brings more difficulty to restrain inflation and control commodity price soaring.

She also stresses that they should pay much attention to market change, not only should control overheated market development, but also should prevent market cooling. Seeing from the market from January to February, the domestic producer goods price soaring was under control efficiently.

Japan and China agree on shielding Asian economy

Kyodo News cited Mr Fukushiro Nukaga finance minister of Japan as saying that Japan and China agreed to protect Asia's economy from the slowdown in the United States economy and the global turmoil being caused by the supreme mortgage crisis.

Mr Nukaga told a press conference after talks with his Chinese counterpart Mr Xie Xuren in Tokyo that "We confirmed that exports from both Japan and China to the United States have declined due to the US deceleration."

Mr Nukaga said after the talks, which were held as part of the one day Japan-China Finance Dialogue "We agreed to share information and to cooperate to prevent the Asian economy from being negatively affected."

The two sides discussed a range of global and regional issues, including global warming, the yuan's exchange rate and regional currency swaps at the forum.

The meeting took place ahead of Mr Hu Jintao's president of China expected visit to Japan in May 2008.

Chinese to spend 78% more on energy efficiency and emission reduction

It is reported that China ministry of finance said on March 24th that China's central government plans to increase spending on energy efficiency and greenhouse gas emission reduction schemes by 78 percent this year as part of a larger effort to meet its 2010 environmental targets.

The ministry said in a statement that total expenditure would rise to CNY41.8 billion from CNY 23.5 billion last year and has set a target of reducing energy consumption for every CNY 10,000 of GDP by 20% from 2006 to 2010, with discharges of key pollutants set to drop 10%.

It said the ministry would earmark CNY 27 billion of special funds and the remaining CNY 14.8 billion would come from the National Development and Reform Commission. Out of the CNY 27 billion, 7.5 billion would be invested in ten energy-saving programs, including technological transformation in factories, substitutes for oil and the introduction of energy-efficient light bulbs.

The ministry would spend CNY 4 billion in closing inefficient coal fired power units and outmoded steel plants, while CNY 5 billion would be used to tackle environmental issues in major rivers and lakes.

Metinvest opens a steel service centre in Serbia

It is reported that the procedure of registration of Metinvest-SMC-Beograd, the first retail sales entity of Metinvest Group abroad has been completed. The new born company is to ship Metinvest steel products to Balkanian regional market.

As per report the sales mix of the company will be comprised primarily of the rolled products of the three Ukrainian steelmaking companies: Azovstal Iron & Steel Works, Yenakievo Steel Works and Makeyevka Steel Works along with Bulgarian Promet Steel.

Mr Dmitriy Nikolayenko director of Metinvest-SMC Company said “Establishment of a steel trading company in Serbia is the first step towards creation of the network of foreign service centers. This year we are planning of selling 150 Kt of rolled steel products in Serbia.”

Previously Metinvest used to sell its products on Serbian market at wholesale via the representative office of Leman Commodities SA in Belgrade. With the establishment of a genuine steel service centre directly in heart of Serbian market Metinvest has gained an opportunity to optimize the system of reciprocal payments with customers, decrease significantly the lag between the order placement and products shipment and expand the mix of products in complete bundles.

Ukraine to start talks with Romania and Slovakia for Kryviy Rih iron ore plant

Ukrainian Journal Staff reported that Ukraine will next week start talks with Romania and Slovakia over privatization of major Ukrainian iron ore deposit in which the two countries have minority stakes.

The report added that the development is a major change because Ukraine has so far been planning to sell the deposit, known as Kriviy Rih Oxidized Ore Mining Plant, without regard to the position of the two countries.

ISS recommends vote against Onexim proposed changes to Norilsk board

MMC Norilsk Nickel has announced that Institutional Shareholder Services Governance Service had released its analysis and voting recommendations for the April 8th 2008 Extraordinary General Meeting of Norilsk Nickel shareholders.

The released added that Institutional Shareholder Services recommended that Norilsk Nickel stockholders vote their shares AGAINST Onexim Group’s Proposals 1 and 2 as well as cumulate their votes evenly between the Independent Directors Mr Guy de Selliers and Mr Schimmelbusch HS on Proposal 3 at the EGM.

Institutional Shareholder Services noted regarding Onexim’s first proposal to amend Norilsk Nickel’s Charter with the respect to the minimum number of Board members needed to approve resolutions “We do not see why the proposed amendment would be necessary at MMC Norilsk Nickel. We do not see a convincing reason why a large number of executive powers should be transferred from the company's management to its board of directors. As explained by the company, should this proposal be approved, the board would have to address approximately 2,000 additional issues every year, which would severely overburden the board and likely lead to its inefficiency.”

Further with respect to Proposal 2 to terminate the current Board members’ term of office, ISS stated, “it appears that the proposing shareholder does not have a compelling proposal for shareholders, and that the best way to protect shareholders' interests is to make sure that independent directors remain on the board. We do not believe that Onexim Group's proposal to terminate the current board is sound. Therefore, we recommend a vote against item 2 at this meeting.”

Lastly, in the event that Proposal 2 passes at the EGM, ISS stated “as, in our view, only independent directors are likely to act on behalf of all shareholders, we recommend that shareholders cumulate their votes for the two independent incumbents de Selliers (item 3.6) and Schimmelbusch (item 3.21)”

Mr Denis S Morozov General Director of Norilsk Nickel said “We are gratified that ISS, the leading voice in corporate governance, recognizes the vital role that independent directors serve at Norilsk Nickel in representing the best interests of the minority shareholders. We strongly agree with ISS that Onexim Group’s proposals should be rejected by the shareholders and that the Company’s charter and board are well balanced.”

OMK VMZ to double R & D expenditure in 2008

It is reported that OMK’s mining metallurgical plant OAO VMZ in Nizhny Novgorod plans to finance research and development activities in 2008by more than RUB 59 million compared with RUB 24.8 million in 2007.

As per report, the main areas of research and development in the current year will be the development and manufacture of new types of exploitation of pipes and railway wheels. The research will be aimed at reducing the consumption of the metal in the manufacture of pipes and wheels, improved quality and operational reliability of pipes, increased strength and improved mechanical properties wheels.

In 2007, R&D at VMZ, in particular, mastered the technology of production of medium diameter pipes, testing new lines anticorrosive coating of large diameter pipes for compliance with local and international standards to improve the quality of research steel wheel, persistence and productivity in the processing tool rail wheels.

Increased R&D funding should help to further improve the quality and competitiveness of VMZ produced pipes and wheels, the development of promising products that meet the increasing demands of customers.

Ms Tymoshenko warns investor against RosUkrEnergo

Reuters reported that Ms Yulia Tymoshenko PM of Ukraine has advised a Ukrainian billionaire to abandon plans to buy a 50% stake in RosUkrEnergo, saying that the gas intermediary is engaged in opaque dealings and has no future

Ms Tymoshenko said "I think Mr Kolomoisky and Privat have simply lost their business sense.”

She said this would be their most unfortunate investment in 15 years of working in Ukraine a