SAIL RSP achieves record production in first 11 months

Steel Authority of India Limited’s IL Rourkela Steel Plant has achieved record production by surpassing its annual rated capacity production in hot metal, crude steel and saleable steel during April 2007 to February 2008 period for the first time since its inception. During the period, it has dispatched 1.84 million tonnes of steel up by 3.9% YoY.

Production details during the April 2007 to February 2008 period are as under

In million tonnes

In February 2008, RSP recorded production of 284,085 tonnes of sinter up by 27% YoY, 186,720 tonnes of hot metal up by 13% YoY, 179,217 tonnes of crude steel up by 13.5% YoY and 171,584 tonnes of total saleable steel up by 15.8% YoY. It has dispatched 175537 tonnes of steel during February 2008 up by 18% YoY.

Steel ministry not to intervene on pricing issue

BL reported that Mr Ram Vilas Paswan union steel minister has ruled out any intervention by his ministry in the steel pricing issue.

The report quoted Mr Paswan on the sidelines of the International Petrochem Conference as saying that “The last time we had called for a meeting with steel producers there had been some criticism. I will not call for another round of meeting. I leave it to them to decide on price hikes based on market conditions.”

He said that “Such interventions were not good for the industry’s health. Also, it tended to send a signal that the Government wanted to interfere.’

He added that in any case state owned steel producers accounted for only 30% of the domestic steel production and the rest is from the private sector.

Mr Paswan however warned that if the steel makers hiked prices unreasonably, the ministry could step in. He said the “Ministry has a benchmark ratio that indicated the maximum hike that the producers could make, given the prevailing cost of key inputs and other market conditions. If the prices go over this limit, we will have to intervene. We have a committee, which closely monitors steel prices.’

Steel ministry had called for three meetings in the recent past with steel producers, with the last two resulting in price cuts of about INR 2,000 and INR 1,000 per tonne respectively.

Mandatory standards for steel products from May – Report

According to Mr K Anbarasu deputy DG of Bureau of Indian Standards, standards for 17 products in steel are to be made mandatory from May 2008.

He said that "India’s growth process and achievements have much to do with the process of standardization of products. It helps to face internally the global competition and find markets outside for the products. So far, 18,000 Indian Standards have been formulated and 90 of them relate to mechanical transmission devices. Awareness about standardization of products and the benefits that follow will help in the growth of industries in and around Madurai as it is becoming a rubber belt in the region."

Mr Anbarasu said that the standards are not formulated by BIS but by committees consisting of members from the respective industries and technical experts among others. These standards are amenable to changes as becomes necessary in the opinion of the committees. He urged the industries to participate in and give inputs for the fixation of standards, both national and international, to make the process easier.

Meanwhile, Mr TG Mohanram senior VP & director of Fenner Conveyor Belting Private Limited said that awareness about standardization would help the small industries in exports in the face of global competition. With World Trade Organization in place, matching standards have become necessary among countries.

Indian coal import to increase in 2008

Reuters reported that India is likely to import 33 million tonnes to 34 million tonnes of coal in 2008 slightly up from 2007.

Ms Robin Griffin senior analyst with Barlow Jonker Pty Ltd while speaking at a Coaltrans conference in New Delhi said that "China is set to be a net coal importer with imports exceeding exports by 4 million tonnes in 2008, from being a slight net exporter in 2007."

Ms Griffin added that she expected South African coal imports to India to rise to 11 million tonnes in 2008 up from 8.37 million tonnes in 2007.

Bloomberg quoted Mr Anil Razdan union power secretary as saying that India may import about 60 million tonnes of coal a year by 2012. He added that "Indian companies are talking to suppliers in Indonesia and Africa for long term coal supply contracts."

India uses coal to produce for more than half its 141,080 MW generation capacity.

ArcelorMittal eying Indian energy sector

BL reported that ArcelorMittal is diversifying into the energy sector in India, especially oil and gas.

Mr Aditya Mittal CFO of ArcelorMittal while speaking on Creating Global Champions organized by the Confederation of Indian Industry said that "India is an energy deficient country and we are already working with Indian government. We have 27 manufacturing plants across the globe and China and India figure prominently in our global business strategy."

Mr Mittal said that "Asia at present would account for half of the global steel consumption. The steel consumption in China is 500 million tonnes per annum with a growth of 10%. We have a well defined China strategy and have recently signed a pact to acquire a company in China.”

Observing that Indian steel consumption was much lower than that of developed countries, Mr Mittal said that “There is tremendous scope for India in steel. We have a vision for the next 20 years and will be a player here too.” He added that the coal mine allocation for the two plants in Orissa and Jharkhand were done and the ground breaking would soon be done.

On the rising steel prices, Mr Mittal said the reason was increased prices of raw materials. He added that “Since 2004, however, the steel industry has stabilized the prices to a greater extent.”

Socio economic survey completed for POSCO steel project

SNS reported that Orissa’s Jagatsinghpur district administration has complied the detailed socio economic survey report for POSCO steel project and is likely to submit it to the government for finalization of the specific rehabilitation package.

The completion of the socio economic survey is being regarded as a major achievement in view of the fact that it has been delayed by more than 2 years. The administration had not been able to enter the proposed site area for more than one and a half years due to stiff resistance by local people.

Officials sources said that 1,930 households were covered under socio economic survey while 2,315 betel vine including 1,085 in Gobindpur village, 11 in Bhuyianpal, 300 in Polang, 15 in Noliashai and 904 in Nuagaon village were also covered by the survey. The survey has also identified 329 original families and 265 extended families who, are to be displaced to facilitate establishment of the POSCO steel plant project. Of the 329 families, 140 families are living on private land while the rest had encroached government land.

Mr Nrusingh Swain special land acquisition officer of the survey said that survey teams have included 105,000 trees including 71,357 cashew trees, 4,087 coconut trees, 4,382 mango trees, 2, 374 jackfruit trees, 418 chakhunda trees in project site. Besides the trees, other items like 32 tube wells, 41 ponds and 26 prawn farms have been covered by the survey so due compensation is provided.

It may be noted that the socio economic survey started on February 7th 2008 in seven villages of Nuagaon, Dhinikia and Gadakujang panchayats. With the survey report ready, the next step is to work out valuation and compensation packages.

TATA Steel observed 169th birth anniversary of Mr Jamsetji Tata

TATA Steel has observed the 169th birth anniversary of its founder Mr Jamsetji Nusserwanji Tata with pomp and gaiety.

Several functions were organized to mark the occasion, where dignitaries including Mr B Muthuraman MD of TATA Steel and former MDs Mr JJ Irani and Mr Rusi Modi paid floral homage to Mr Jamsetji.

Mr Muthuraman said that TATA Steel would speed up its brown field project and the H blast furnace, which was to be commissioned at its Jamshedpur work in June 2008, is likely be commissioned a month ahead.

Colorful floats were taken out by almost all departments of TATA Steel, its associated companies and social organizations on the occasion. The founder's day celebration was special this year as TATA Steel was observing its centenary year.

All India inter steel plant chess championship at SAIL SSP

It is reported that Steel Plants’ Sports Board and Salem Steel Plant are conducting the All India Inter Steel Chess Championship at Salem Steel Plant.

Inaugurating the event, Mr BB Singh executive director of SSP has mentioned that the game of chess is an intellectual game calling for oneness of mind and spirit and welcomed the participants.

In the 3 day event, 9 teams comprising 45 players from Alloys Steel Plant, Bhilai Steel Plant, Bokaro Steel Plant, Durgapur Steel Plant, IISCO Steel Plant, Rashtriya Ispat Nigam Limited, Rourkela Steel Plant, TATA Steel and Salem Steel Plant are taking part. International chess arbiter Mr Anantharam is overseeing that all the matches are conducted according to international rules and norms.

The highlight of the tournament is the participation of international grand master Mr Dipen Burua from TATA Steel.

Kolkata Port to install 4 cranes at Haldia

BS reported that Kolkata Port Trust has drawn up a plan to install 4 state of the art mobile harbor cranes at the Haldia dock to scale up its productivity.

Mr AK Chanda chairman of Kolkata Port Trust said that "These mobile harbor cranes will be installed at berths number 2 and 13 at the Haldia dock complex by September 2008. We have already invited tenders for this purpose."

He added that the estimated cost of installation of these mobile harbor cranes along with the associated structures is pegged at around INR 150 crore. He said "Installing these mobile harbor cranes would help enhance productivity of the two Haldia berths from the existing 8,000 tonnes to 20,000 tonnes per day."

Mr Chanda said that "Kolkata Port is banking on the upcoming steel projects in West Bengal like Videocon Industries, Jai Balaji Industries and JSW Steel as well as the capacity expansion planned by the existing steel plants to compensate its cargo loss to be caused by the Haldia Paradip pipeline. Steel Authority of India Limited has assured that they will provide 6 million tonne of additional cargo per annum for the next fiscal." He added that in all, it is expecting about an extra 12 to 14 million tonnes of cargo per annum from the steel plants.

Kolkata Port Trust has already invited tenders for setting up 3 additional container freight terminals to meet the port's growing container throughput. It handled container traffic of over 349,000 TEUs in 2006-07.

TATA Power to import 2 million tonnes coal in 2008

Reuters reported that TATA Power Company Limited is expecting to import 2 million tonnes of coal in 2008, mostly from Indonesia.

Mr Amulya Charan MD of TATA Power Trading Company Limited said that "We will have to import about 2 million tonnes of coal in 2008, mostly from Indonesia." He added that its coal requirements will shoot up in the next 4 years to 5 years with the commissioning of 2 new power units in western India.

TATA Power is India's oldest private power producer with a total generation capacity of more than 2,300 MW. In 2007, it won government rights to build a 4,000 MW power project in western India as part of its plans to add 10,000 MW by 2013.

Satluj Jal inks MoU with Nepal for Arun III hydel power project

Projects Today reported that Nepal government has signed a MoU with Satluj Jal Vidyut Utpadan Nigam for developing a 402 MW Arun III hydro electric power project on build own operate and transfer basis.

As per the MoU, SJVUNL will complete construction of the project within 5 years after it receives necessary fund for implementation of the project. It will provide 21.9% of free electricity to the Nepal government every month when it starts generating power from the project in addition to royalty and export tax of the electricity.

Satluj Jal will also reimburse INR 451.4 million to Nepal government as the amount spent by the government for feasibility study of the project. It will also be responsible for constructing access road and transmission line as well as conducting environmental impact assessment of the project site.

The central government holds 75% stake in SJVNL and Himachal Pradesh government owns the rest.

US Steel Canada and Cleveland Cliff withdraws from Wabush negotiations

United States Steel Corporation’s subsidiary US Steel Canada Inc, formerly known as Stelco, announced that it has withdrawn from negotiations to sell its 44.6% interest in the Wabush Mines Joint Venture to ArcelorMittal Dofasco Inc.

US Steel Canada gave no reason for its decision. But Cleveland-Cliffs said the move is best for the company. Mr Donald Gallagher president of Cliffs' North American business unit said "Cliffs believes that terminating negotiations and remaining a partner in the Wabush Mines joint venture is the best course of action for all stakeholders at the current time.’

The Wabush Mines JV includes the Scully mine near Wabush and a processing mill and port operations in Quebec and has an annual capacity to produce 4.8 million tonnes of iron pellets. US Steel Canada Inc holds 44.6% stake in Wabush Mines, while Cleveland-Cliffs owns 26.8% and ArcelorMittal Dofasco holds the remaining 28.6%.

MMX completes acquisition of Minerminas

MMX Mineracao e Metalicos SA further to the public announcement made on January 15th 2008 informed that its subsidiary AVX Mineracao e Participacoes Ltda has concluded the acquisition of Minerminas Mineradora Minas Gerais Ltda.

As per release “For the purchase of 100% of Minerminas shares, AVX will pay a total of USD 115,625,000 payable in 7 semi annual consecutive installments, which represents a saving of almost USD 10 million from the amount announced in the Original Public Announcement.”

The first installment of USD 16,517,857.00 has already been paid and the six remaining installments of equal amount will be paid in the months of July and January of each year, with the last installment due in January 2011.

The release further added that “Through AVX, the Company is merging the operations of AVG and Minerminas in order to obtain synergies and economies of scale. The Company estimates that the integrated operations of AVX should produce 6.1 million tonnes of iron ore in 2008 and 6.6 million tonnes of iron ore in 2009. In this regard, the Company has approved investments of nearly USD 40.1 million to improve operations over these two years, which alone will enable AVX to reach production capacity of 8 million tonnes in 2010.”

Meanwhile, MMX plans to increase investments for the second stage of expansion of the operating capacity of AVX and for this purpose, is conducting engineering studies in order to reach production capacity of 10 million tonnes in 2010.

Corus wins steel supply deal for aircraft carriers from Royal navy

It is reported that contract for supply of 80,000 tonnes of steel plates and bulb flats worth GBP 65 million for GBP 3.8 billion carriers, HMS Queen Elizabeth and HMS Prince of Wales, which are due to enter service in 2014 and 2016 respectively, have been awarded to Corus and Dent Steel Services (Yorkshire) Ltd.

Most of the steel will be manufactured at Corus's sites in Scunthorpe, Skinningrove in Teesside and Dalzell, near Motherwell in Scotland. Dent Steel Services will be providing warehousing, as well as shot blasting and painting services.

Mr Richard White, of Corus said "We secured this prestigious contract in the face of competition from a number of steel producers. This success confirms our ability to produce world class steel and is a welcome boost to Corus's three UK sites involved in the manufacturing program."

Sidor Union starts 48 hour strike

Reuters reported that the union at Venezuela's largest steelmaker, Argentine controlled Ternium Sidor said that it has begun a 48 hour strike on Tuesday in a dispute over a labor contract.

The government has been mediating to end the contract talks, which have dragged on for months and periodically led to short stoppages.

Ternium has a 60% in Sidor, with workers, pensioners and the state holding the remaining portion. Ternium Sidor produces 4.8 million tonnes of liquid steel annually.

K Line signs 20 year iron ore contract for Hyundai Steel

Kawasaki Kisen Kaisha has announced the conclusion of a 20 year consecutive voyage charter contract with Glovis Co a logistics arm of South Korea's Hyundai Group for a dedicated very large ore carrier to transport iron ore.

As per release “The contract is due to take effect in 2012. A 250,000 DWT ship will be assigned to annually haul about 3 million tonnes of West Australian iron ore to South Korea on behalf of Hyundai Steel Co.”

Glovis said in January that it has been awarded a contract by Hyundai Steel to transport steelmaking raw materials over a period of 20 years. Besides the one from K Line, it has reportedly decided to charter four dedicated carriers to move iron ore and coking call two from Hyundai Merchant Marine and one each from STX Pan Ocean and Hanjin Shipping.

Hyundai is pushing a plan to build a blast furnace with Hyundai Steel taking the lead. The furnace is set to come on stream in 2010. When it becomes fully operational in 2012, the company is expected to require 10 dedicated vessels to transport its steelmaking materials.

Tavsa conflict comes to an end

BNamericas reported that employees and representatives from Venezuelan seamless tube manufacturer Tavsa have agreed to end a plant stoppage that lasted over one month.

A spokesperson from national steelworkers union Sutiss told BNamericas that "Thanks to intervention from the labor ministry, the company consented to seeking an agreement.”

The spokesman said that the plant has been at a standstill because of a strike that started due to poor service in the cafeteria. He added that as of March 7, a committee from the national assembly and the regional legislative board will begin calling Tavsa board members to discuss the situation.

The spokesperson said that "For now, we will go back to work.”

The Tavsa plant is a subsidiary of Luxembourg based Tenaris it is the only seamless steel tube producer in Venezuela and supplies state oil company PDVSA. It has production capacity of 80,000 tonne per year of seamless steel tubes.

BHPB bid for Rio –BHP arranging for USD 55 million loan

Reuters reported that mining giant BHP Billiton is talking to sub underwriting banks on a record USD 55 billion loan backing its hostile bid for rival Rio Tinto.

A banking source said that "We are talking to a number of relationship banks.” The source added that the company and mandated lead arrangers Barclays, BNP Paribas, Citigroup, Goldman Sachs, HSBC, Santander and UBS have approached around ten relationship banks to sub underwrite the loan. They said that sub underwriting banks are being asked to commit USD 2.5 billion each, with a view to holding around USD 1.75 billion after wider syndication.

The banker said that "The pricing rationale reflects the size of the deal given its size we need to make things a little more appealing to potential lenders. There is an element of new money to raise and it also reflects current market conditions.”

The large size of the sub underwriting commitments is the first major test of European banks' appetite in 2008 and will redefine market capacity.

Banks will however, be keen to lend to the world's third largest company in an environment of soaring commodity prices and the loan will not be drawn until late 2008 or beyond when the acquisition is complete. The lending decision may also be eased by favorable capital treatment under the new Basel II accord, bankers close to the deal said. BHP Billiton is targeting a high single A rating after the acquisition, which will require banks to allocate less capital against the loan.

Nippon to reduce plate supply by 20% in H1 of 2008

JMB reported that Nippon Steel will reduce the plate shipment for distributors by 20% for April to September 2008 from October to March 2007 period.

As per report Nippon Steel reduces the supply to secure plate for large diameter pipe materials along with shipbuilding and construction and industrial machinery applications. The supply for distributors decreases by more than 35% YoY.

It added that the reduced supply could accelerate the inventory adjustment for the still oversupplied distributors' market. The lower supply could lift the market price along with JPY 20,000 per tonne hike pressure.

Corus Port Talbot steelworks gets GBP 9 million investment

It is reported that Corus has given its Port Talbot steel works another multi million pound boost. As per report Corus has announced a GBP 9 million investment in the coke making section just weeks after it confirmed it would be spending GBP 60 million on an energy recovery plant for its Basic Oxygen Steelmaking facility.

The new cash will be spent on a quenching tower, which cascades water over coking fuel as it comes out of the ovens. Corus management said that it will help Port Talbot move closer to its production target of 5 million tonnes of steel slab a year.

Mr Jon Ferriman heavy end general works manager said that "The investment is another step in creating a sustainable steel industry in South Wales. The investment represents an important vote of confidence in Welsh steel making, as Corus is integrated into the TATA Steel Group."

ArcelorMittal SA to raise prices by 15% to 25% in April

Engineering online reported that Africa’s largest steel producer ArcelorMittal South Africa would increase its prices by between 15% and 25% in April 2008.

A spokesperson for the ArcelorMittal SA confirmed that this would be the third consecutive monthly increase. In February 2008, steel prices rose by between 3% and 10% and in March the prices of flat steel increased by 10% and long steel products by 12%.

Last year, ArcelorMittal South Africa bumped heads with South African competition authorities, following complaints from industry over its pricing system, as was slapped with a ZAR 691.8 million fine for charging excessive prices.

Thyssenkrupp to raise steel prices

It is reported that ThyssenKrupp has raised steel prices by up to EUR 100 per tonne effective from April 1st 2008 responding to rising raw material costs.

Mr Jost Massenberg board member of ThyssenKrupp at a steel conference in Dusseldorf said that it sees positive market signals it can further raise prices effective from July 1st 2008.

Mr Massenberg separately said that ThyssenKrupp fears costs from buying carbon dioxide emissions allowance to amount to some EUR 1 billon annually from 2020, if the EU does not provide the steel industry with an exception. He said he sees the price for allowance certificates rise to EUR 50 per tonne by 2020.

UBS raises coal price forecasts to 30%

According to UBS AG, thermal coal and coking coal prices may rise a third more than forecast this year as flooding at Australian mines and severe snowstorms in China restrict supply.

UBS in a report by analysts led by Mr Glyn Lawcock said that the price for thermal coal, used in power stations, may increase to AUD 130 a ton for the Japanese financial year beginning April 1st 2008. The previous forecast was AUD 100 a ton. Estimates for coking coal, used to make steel, were raised by 32% to AUD 225.

Mr Lawcock in the report said that floods in Queensland State in Australia, the producer of more than two thirds of the world's traded coking coal, led at least six producers to foreshadow missed deliveries, pushing cash prices to almost three times higher than contracts. Xstrata Plc wants as much as AUD 330 a ton for coking coal in line with spot prices.

He added that supply restrictions have consolidated pricing power further in the hands of producers just as benchmark contract negotiations come close to conclusion.

Queensland plans for Abbot Point Coal Terminal expansion

AAP reported that the Queensland government has given the go ahead for two new projects worth AUD 163 million at the Abbot Point Coal Terminal in the state's north.

Premier Anna Bligh said the terminal, north of Bowen, would be able to increase its capacity from 21 million tonnes per annum to 25 million tonnes after a AUD 95 million expansion. She added that another AUD 68 million would go towards upgrading the existing stockyard system.

She further added that more than 120 workers would be employed in the project, with work starting in July this year and due for completion by mid 2009.

Ms Bligh said that "The port has the potential to expand further in the future to cater to the needs of the rapidly growing north Queensland economy.”

US weekly crude steel production down by 1.2% YoY

American Iron & Steel Industries reported that in the week ending Marcch 1st 2008, US’s raw steel production was 2.153 million net tons while the capability utilization rate was 90.3%. Production was 2.126 million net tons in the week ending March 1st 2007, while the capability utilization then was 89.5%. The current week production represents 1.2%decrease from the same period in 2007.

Production for the week ending March 1st 2008 is down by 0.2% from the previous week ending February 23rd 2008 when production was 2.158 million net tons and the rate of capability utilization was 90.5%.

Adjusted YTD production through March 1st 2008 was 18.969 million net tons at a capability utilization rate of 88.4%. That is a 6% increase from the 17.889 million net tons during the same period last year, when the capability utilization rate was 87%.

AISI’s estimate is based on reports from companies representing about 75% of the US’s raw steel capability and includes revisions for previous months.

Japan exported 47,000 tonnes of H beam in January 2008

YIEH reported that Japan has exported 47,000 tonnes of H beam in January 2008 down by 4% MoM, but it was 4 times of the same period of 2007.

The average export price stood at JPY 79,000 per tonne an increase of JPY 9,000 per tonne from the same period of last year. It added that the exports of H beam were mainly shipped to South Korea. The quantity was as many as 31,000 tonnes and the average export price was JPY 79,000 per tonne up by JPY 2,000 per tonne than that of last month.

In the meantime, the import of H beam was 6,750 tonnes, increasing by 53.3% MoM from last month.

(Sourced from YIEH .com)

Rautaruukki launches single storey construction solutions in Hungary

Rautaruukki announced that it is to launch a solutions package in Hungary to simplify and make the design and construction of commercial and industrial buildings more efficient. The innovative solution includes the design, manufacture and installation of foundation, steel frame and envelope structures eg for retail, logistics and production premises.

Mr Saku Sipola president of Ruukki Construction said that "We are responding to the challenges in the construction industry by employing innovations and a high degree of prefabrication. A fast, efficient design, manufacturing and construction process saves our customers’ and partners’ time and resources. Our solutions also mean less financial and operational risk when the various parts of the building are designed and manufactured to fit each other.”

The biggest time saving is achieved by an easy and fast design and offer process. Mr János Papp vice president, sales, Hungary, Serbia, Slovenia and Croatia of Ruukki Construction said that “We have created a tool that enables us to plan the hall with our customer and to make an offer at once. Our continuously strengthening production capacity in Hungary and neighboring countries ensures reliable deliveries, and the proven structural solutions are easy and safe to install.”

Ruukki produces frame, wall, façade and roofing structures for the Hungarian market mainly at its units in Hungary, Slovakia and Poland. The Biatorbágy unit in Hungary produces roofing and load bearing sheets and façade elements.

POSCO E&C sign deal for power plant in El Salvador

Yonhap reported that South Korean builder POSCO Engineering & Construction Co has signed a USD 500 million deal to build a thermal power plant in El Salvador.

As per report under the deal with AES Fonseca, a Salvadorian unit of The AES Corp a global power company, POSCO E&C will ground break for the plant in July with the aim of completing it by September 2011.

The plant will be built in an area, approximately 160 kilometers southeast of San Salvador, the capital of the Central and South American country.

Japanese import of stainless steel scrap drops in January

According to related statistics, Japan imported 12,974 tonnes of stainless steel scrap in January 2008 down by 24.1 YoY. But the figure decreased by 13.2% MoM.

As per the statistics the import price on average was at JPY 356,477 per tonne increasing by 2.9% MoM. America, South Korea, Taiwan and Thailand are the main export countries of stainless steel scrap to Japan.

It added that Japan’s import of stainless steel scrap from Taiwan and South Korea decreased sharply. Besides, the production of stainless steel of Japan in the first quarter is estimated to decrease year on year.

(Sourced from YIEH.com)

Gerdau to offer USD 2.4 billion in stocks

Reuters reported that Brazil's steel company Metalurgica Gerdau and its controlling entity Grupo Gerdau will offer BRR 4 billion (USD 2.4 billion) in preferred and ordinary stocks.

According to a statement sent to the CVM securities market regulator, around BRR 2.8 billion worth of Grupo Gerdau and BRR 1.2 billion in Metalurgica Gerdau stocks will be sold in a primary stock offering.

The document said that company stockholders will have preference in subscribing for the stocks and that controlling shareholders have the intention of exercising their priority rights.

Al Ezz raises steel prices by EGP 370 per tonne

Daily News Egypt reported that, for the 4th time in 2008, Al Ezz Steel Rebars has increased steel prices by EGP 370 per tonne this week, bringing wholesale steel prices to EGP 4,580 per tonne and consumer prices close to EGP 5,000 per tonne.

Al Ezz, which currently controls a solid 65% of the market share, has been abruptly raising prices to unprecedented highs since January 2008 and similar increases are expected throughout the year.

Meanwhile, local investment firm Beltone Financial has expected iron ore prices to rise by at least 35% in 2008 and by 10% in 2009. It said that “As is the case with cement, steel demand is expected to grow in the double digits in 2008 on growth in infrastructure and real estate investment. International iron ore and scrap costs are expected to also increase significantly in 2008. So far, global steel giants have detailed plans to increase prices this year and consequently Al Ezz Steel Rebars announced a 7% rise in ex factory prices at the start of 2008 and is expected to be able to pass on further rising costs in the near term.”

ISTIL Middle East to set up bar & rod mill in UAE

MEsteel reported that steel major ISTIL Ukraine’s subsidiary ISTIL Middle East is planning to set up a 500,000 tonnes bar & rod mill at Dubai Industrial City in UAE.

As per report, the statutory preliminary approvals from Dubai Industrial City had already been obtained and the approvals from other local agencies are underway. The land and machinery, costing USD 25 million has already been acquired.

The tender for civil and structural works has been announced and the civil work is planned to be started by the beginning of April 2008.

Maknan Consultancy Private Limited has been awarded for engineering.

RMMI to invest AED 918 million in copper & cobalt mine in Congo

Ras Al Khaimah Minerals & Metals Investments has announced that it will invest AED 918.1 million in Congo to mine and process copper & cobalt. It said that the move is in line with the strategy of the Ras Al Khaimah government to integrate industrial minerals and metals in its investment growth.

Meanwhile, Mr Madhu Koneru MD of RMMI has announced the formation of Ras Al Khaimah Minerals & Metals Congo and the AED 183.6 million acquisitions of a 50% stake in Katanga Minerals Processing and also a 50% stake in Premiere Miniere Du Katanga, both in Congo.

Mr Koneru said that “These acquisitions have set the pace for the company and will allow us to get a foothold in the world’s largest resource for copper and cobalt. These will also enable us to get into high-end metal products right from the beginning.” He added that it would set up a world class copper and cobalt smelter plant in the Katanga region of Congo with an initial investment of AED 734.5 million.

Mr Marc Orphanides MD of Ras Al Khaimah Minerals & Metals Congo said that its strategy is to vertically integrate the mining process by excavating copper ore, then enriching the extract to 4% to 25% and finally producing ingots to meet the local and export requirements.

The RAK government already has investments in real estate and hydropower projects in Congo while RMMI signed a MoU with the provincial government of South Sumatra, Indonesia on coal mining and logistics in February 2008. RMMI said that the MoU covers the entire mining to export chain of the coal industry as well as developing a world class integrated industrial and logistics infrastructure, including rail transport corridor and deep water seaport to handle bulk and container cargoes.

GCC accounts for 60% of FDI in Arab World – Report

According to Mr Abdullah bin Ahmed Al Saleh undersecretary of UAE’s ministry of economy, the GCC accounts for more than half of the foreign direct investment flowing into the Arab World, but there is still a lot of room for growth in the Gulf countries.

Mr Al Saleh said that “The size of actual foreign direct investments in the Arab World is very small if compared to the volume of FDI in the GCC region. Here, we can see the GCC countries have taken more than 60% of the direct foreign investments however, this figure is only 2.5% of the world’s market share of foreign investments"

He added that "On the other hand, the volume of investments among the Arab countries has increased tremendously from USD 6 billion in 2004 to USD 60 billion in 2006. This is considered a massive jump, but it is still small if we look at the volume of investments outside the Arab World, which is around USD 1.2 trillion in 2006.”

Mr Al Saleh said that one reason the GCC has done better than the rest of the Arab World is the fact that it has moved towards becoming a common market. He added that “If we take the GCC common market, we can see the goods are moving among them without barriers. However, there are still some rules that are not being implemented in some GCC countries. The main rule is treating all GCC citizens equally in all the countries in regards to ease of doing business.”

He further added that “UAE is ranked 18th out of 41 countries in terms of attracting foreign investments in 2007. In another report on investors’ confidence in doing business, the UAE was ranked 8th internationally. Also in a report about the volume of foreign investments, the UAE received USD 18.7 billion in 2006. The main challenges are the economic and trade laws and regulations, and the lack of implementation of these laws and regulations on both local and federal levels. This made the UAE to come up with free zone areas and this is what has pushed the trade and business cycles.”

Qatofin awards terminal deal to Talke Logistic

The Peninsula reported that petroleum firm Qatofin has awarded a contract to German based Talke Logistic Services for the construction and operation of a dedicated logistics terminal worth QAR 140 million in Mesaieed Industrial City. Mr Mohammed Yousef Al Mulla GM of Qatofin and Mr Armin Talke CEO of Talke Logistic Services have signed the agreement.

The deal includes completing construction work of an onsite silo logistics centre by the end 2008 and operation of the facility on behalf of Qatofin for 15 years. Qatofin’s logistics terminal will be one of the largest and ultra modern of its kind in the GCC. Occupying a total area of 100,000 square meter, 56,000 square meter of covered warehouse for packaged products, 12 silos of 1,100 cubic meters each for bulk storage, two fully automated packaging lines and container handling area, the terminal will cater for a total production ranging from 450,000 to 600,000 tonnes per annum when operation gets underway.

Talke Logistic Services said that this is one of the largest contracts the company has won in its history. The transaction also involves the acquisition of Vos Silo Logistics Qatar and Vos Middle East Holding by the company.

Al Mulla said that, with the evolution of the petrochemical industry, customers expect outstanding quality services alongside quality products. He added that "Qatofin spared no efforts to develop a strategic partnership with Talke to secure logistics solutions that match the company's pursuit for customer satisfaction. The deal will launch mutually beneficial partnership between Qatofin and Talke."

Mr Alfred said that "The construction and operation of the Qatofin facility means Talke is the first logistics provider to be active in the petrochemical industry's main producing countries in the Middle East."

Qatofin is a 63:1:36 JV between Qatar Petrochemical Company, Qatar Petroleum and Total Petrochemicals of France. Its long term goal is to develop Qatar's polyethylene industry into one of the leading global producer of LLDPE in the region.

Wuhan's plan to build 10 million tonnes mill to get approved

Reuters reported that Beijing will soon approve Wuhan Iron and Steel Group's plan to build a 10 million tonne steel mill in the southern city of Fangchenggang, opening the door for it to buy into smaller rival Liuzhou Iron and Steel. The drive is part of China's plan to develop the coast of the Gulf of Tonkin and boost trade ties with Southeast Asia.

A source at the local planning body of the Guangxi regional government said "The 10 million tonne steel mill has been earmarked as one of the seven major projects in the development plan of the Beibu Bay and the central government will approve the steel maker’s construction."

The sources in Wuhan Steel and the Guangxi government said Wuhan Iron and Steel Group, China's No 4 steelmaker has already begun preparations for infrastructure construction at the site, on the Guangxi coast. It said Wuhan Iron and Steel Group and the government of Fangchenggang City signed an agreement to jointly build up the framework construction recently.

Mr Liao Zhigang chairman of Liugang's listed unit Liuzhou Iron and Steel Co Ltd said "If it gets approval, the project will lead to consolidation between Wuhan Iron and Steel Group and Liuzhou Iron and Steel Group."

In late 2005, Wuhan Iron and Steel Group, the parent of Wuhan Steel announced that it would buy into Liugang and that the two would jointly build a 10 million tonne steel mill as part of Beijing's plan to build large, state of the art mills along the coast.

Baosteel to design and install 2nd COREX plant

It is reported that Baoshan Iron & Steel Co had spent CNY 14.28 billion buying Luojing project assets from Baosteel Group which included the world's largest COREX smelting furnace. And the second C3000 COREX plant is reported to be designed and manufactured mainly by itself, except for the frame to be introduced in from abroad.

Baosteel's first COREX has nominal capacity of 1.5 million tonnes of molten iron, 1.525 million tonnes of steel and 1.6 million tonnes of medium plate a year.

Based on the first, Baosteel designers improved projecting of the second COREX plant including its dust removing system and drainage system.

(Sourced from MySteel.net)

2 workers killed at Baosteel Special Steel

It is reported that 2 workers were suffocated to death at Baosteel when they entered a nitrogen filled furnace for maintenance. The incident occurred around 4:30 PM at Baoshan Iron & Steel Co Special Steel Branch on Shuichan Road. Another three workers were injured while trying to rescue their two colleagues.

Mr Meng Haibiao spokesman of BaoSteel said “The two workers were trying to fix a problem with the furnace door at Baosteel's specialty steel works in Shanghai when they fell unconscious from nitrogen poisoning Monday. The two men were rushed to a hospital but doctors could not revive them.’

He added that the company is investigating why the workers violated safety regulations and entered the furnace. The victims did not wear a mask, breaching work safety regulations.

Jingtang Steel nearing completion of coke oven 'A'

It is reported that Jingtang Steel, a joint venture between Shougang and the Tangshan Group, has completed the masonry work of the chamber of coke oven ‘A’ at its new Caofeidian steel works in northern China's Hebei province.

As per report the installation of the coke oven itself is scheduled to start this month, with the oven due to be ready for ignition on April 1st 2008. The mill’s coke project includes two 7.63 meters coke ovens which are the biggest in Asia.

The multi billion dollar Caofeidian project is part of Shougang’s move out of Beijing. Steel production will be around 9.5 million tonnes per year when the complex at Bohai Bay is fully operational.

Datang to pay additional USD 700 million in 2008 for coal buy

Reuters reported that Chinese power company Datang is paying around CNY 5 billion more for its coal this year than in 2007.

Mr Zhai Ruoyu chairman of Datang International Power Generation Ltd said coal prices have gone up by around CNY 35 per tonne to CNY 40 per tonne, and the company expects to burn around 160 million tonnes of the fuel this year and its state-owned parent. He said despite squeezed margins, Datang group plans to install an additional 10 gigawatts of mostly coal-fired generation capacity this year, bringing total capacity to 75 GW.

He added that "We are under greater pressure. The increased coal cost is about CNY 5 billion but did not specify if he meant the listed firm or China Datang Group Corporation.

Mr Zhai said he expected Beijing would relieve pressures on its power producers by activating a mechanism to translate higher fuel costs into higher state-set electricity tariffs. He said "I believe the coal power price link will be activated. I estimate that this year will be adjusted.

Coal costs have been climbing in China under pressure from both global markets and a drive at home to boost safety standards and consolidate small mines. The government has suspended thermal coal exports until April to try to control prices.

Shenhua gets nod for Indonesian coal project

Reuters reported that Guohua Electric Power Corp a subsidiary of China Shenhua Energy has received approval from Chinese regulators to develop a coal and power generating project in South Sumatra in Indonesia.

The State-owned Assets Supervision and Administration Commission said the project will include a coal mine with annual output of 1.5 million tonnes and two 150 megawatt generators which are expected to start generating power in 2010. This is the first overseas project of China Shenhua Energy.

Shenhua did not give an investment amount or other details of the project.

China is expected to become a net coal importer this year, due to the country's soaring power demand and supply uncertainties.

Guangxi Liuzhou Steel lifts steel prices

China’s Liuzhou Steel has announced to increase its price lists, effective from March 4th 2008.

The new price rise will be CNY 300 per tonne for steel channel and CNY 500per tonne for steel angle. Current price for steel channel is about CNY 5,290 per tonne while steel angle is about CNY 5,380 per tonne.

The above price includes tax.

Chinese PM wants unified energy management

Reuters quoted deputy head of a coal industry of China as saying that Mr Wen Jiabao PM of China's strongly supports unified management of the energy sector and the creation of an energy or coal ministry. China's reliance on imported oil is rising and Beijing is pushing hard to improve efficiency, but its energy sector is currently run largely by a small, understaffed department of the country's powerful economic planner.

Mr Zhang Tiegang deputy director general of Coal Society told reporters on the sidelines of a meeting of an advisory body to parliament that "The prime minister said that energy is a major issue, it is not like other sectors which have been turned over to the market and we can no longer control. We must consider this issue."

A source and Hong Kong news reports said this weekend that plans to create a body to steer the energy sector in the world's second biggest oil consumer as envisaged in a draft energy law could be put on ice after opposition from the country's big oil companies and existing energy agencies.

Mr Chen Deming commerce minister of China's and former top energy policy maker suggested with a passing reference that plans for a ministry might not yet have entirely been buried, however. He said "The energy ministry is in charge."

Guangdong to build nation's largest off shore wind farm

Xinhua reported that South China's Guangdong Province plans to build China largest off shore wind farm in a bid to quench its power thirst.

The report added that the facility with sea area coverage of 240 square kilometers will be co sponsored by the Lufeng Municipal Government and Guangdong Baolihua New Energy Stock Company Limited. The plan includes a 1.25 million kilowatt wind farm, an 8 million KW supercritical power plant and a dock construction project.

Local government officials said the facility is expected to relieve the energy pressure and optimize the energy structure in the booming province.

China began to work on its second west-to-east natural gas transmission pipeline last month. It will mainly carry natural gas from the natural resources rich west to the southeastern Yangtze and southern Pearl River deltas, the country's two most developed regions.

China approves investment of 2 private companies in Botswana

Shanghai Daily reported that 2 Chinese private companies have got the endorsement of the central government to invest in an economic and trade cooperation area in Botswana.

The two companies are the Zhejiang based Daheng Group and Shanghai based Touchroad International Holdings Group.

The report added that the project, called China Botswana Economic and Trade Cooperation Area will function as a comprehensive industrial park including manufacturing, a free trade zone and logistics base.

TMK launches oilfield services division

Oil and gas pipe major TMK has announced the launch of TMK Oilfield Services.

This new independently managed TMK division is comprised of
1. OAO “Orsky Machine Building Plant”
2. OOO “Truboplast” pipe coating company
3. ZAO “TMK Pipe Maintenance Department”
4. OOO “TMK Central Pipe Yard”
TMK Oilfield Services will assume management of each of these companies before the end of the first quarter of 2008.

At first, TMK Oilfield Services will focus on establishing itself in the tubular goods and oilfield services market. It will gradually increase its market share by expanding its range of products and services while enhancing overall quality and acquiring additional assets located directly in oil and gas regions. The newly created services division operates in the Urals-Volga and Western Siberian oil and gas regions.

TMK Oilfield Services is currently formulating its investment program with the goal of improving and expanding its service offerings. Plans are underway to complete a service facility in the city of Nyagan and modernize other service assets acquired from TNK-BP to increase their cumulative repair and finishing capacity to about 1 million seamless pipes per year.

The released added that the creation of TMK Oilfield Services is part of TMK’s strategy to become a global supplier of high performance products to the oil and gas industry. In addition to increasing production of seamless threaded and line pipe, TMK is also developing its oilfield services division to support its customers’ production activities. TMK is further integrating the oil and gas supply chain by producing tool joints and tubing couplings, improving pipe and sucker rod maintenance and repair services, providing coating services, and assisting in the handling and installation of pipe columns in the well.

Mr Konstantin Semerikov CEO of TMK said “Our reputation as the leading supplier of tubular goods to the Russian and CIS oil and gas industry allows us to enter into strategic partnerships with Russia’s largest energy companies. Our joint R&D program and long term contracts with oil and gas majors make it possible for us to develop products that meet specific field requirements and provide our customers with advantageous delivery terms and conditions. Our goal is to meet the current demand fuelled by the intensive growth of the industry, including supporting our customers’ field equipment operations. Expanding into oil and gas services is a good way for us to diversify our activities and hedge against pricing volatility on commodity markets. It increases the share of added value in our revenue structure.”

In 2007, TMK’s service subsidiaries showed significant growth. Orsk Machine Building Plant produced 201,700 welded tool joints an increase of 19% compared to 2006 and 282,400 tubing couplings a 191% increase on 2006 results. Yekaterinburg based pipe coating company, Truboplast, increased shipments of coated pipes by 12% to 50,300 tonnes. TMK plans to double the volume of its value added services in 2008 with expected revenues of RUB 3.8 billion.

ArcelorMittal to increase steel output in East Europe in 2008

Dow Jones reported that ArcelorMittal expects its steel output from East Europe to rise by between 27% and 36% in the current year with the expansion of the company's plants.

Mr Vijay Kumar Bhatnagar executive vice president of ArcelorMittal East Europe said "Production at our plants in Poland, the Czech Republic and Romania is expected to rise to between 14 million tonnes and 15 million tonnes on the back of expansion in existing projects."

He added that the company produced around 11 million tons of steel at its East Europe plants in 2007.

Mr Bhatnagar also said he expects global steel prices to remain firm through 2008. He said the prices of raw materials have gone up all over the world. It makes us feel that steel prices will remain buoyant in 2008.

Mechel plans stepwise growth at Elginsky coal deposit

FIS reported that in a meeting with analysts Mechel disclosed some details regarding the implementation of its projects at Chelyabinsk Metal Integrated Works and Elginsky Coal Deposit.

As for the Elginsky coal deposit, the construction of the road to the deposit is to begin in the near future. Mechel plans to increase coal production to 5 million tonnes by 2012 and to 20 million tonnes by 2015.

Under an agreement with RZhD Mechel will soon start receiving rails for the road. The company is set to develop own production of rails in 2008-2010 at Chelyabinsk metal integrated works.

Mr Denis Gorev analyst of IC Finam believes that the favorable market conditions in the metallurgical and coal industries and the implementation of the announced projects are to produce positive effect on the company's financial result to be translated into the growing share quotations.

Ukraine accuses Gazprom of non payment for gas transit

Itar-Tass reported that Mr Alexander Turchinov first deputy prime minister of Ukrainian has accused Russia's Gazprom gas producer of failing to pay for the transportation of Russian gas through Ukraine's territory accusing Moscow of politicizing the gas issues and blackmail.

Mr Turchinov said "Ukraine is not blackmailing Gazprom, although there are reasons for it since December 2007, the Russian company has not transferred a single kopeck to Naftogaz Ukrainy for providing for gas transportation.”


Mr Turchinov said "We are inviting international experts to see how Ukraine pays for natural gas and why Russia' Gazprom does not pay for transportation. We are ready to show all invoice documents, demonstrate all Ukraine’s positions the balances of gas consumed in the country."

Mr Turchinov affirmed that Naftogaz Ukrainy had footed the gas bill for 2007. He said "Naftogaz Ukrainy with the government’s support, transferred the money on time fully closing the gas issue inherited from our predecessorsUkraine's debt was set at UAH 5.2 billion. It is almost discharged except UAH 414 million which Naftogz does not recognize because they are not just intermediary, but fraudulent schemes, as they tried to draw the 2006 balance with the prices of 2007."

Mr Turchinov assured that cuts in gas supplies would not affect Ukrainian consumers.

RUSAL Komi aluminum project suspended for 2 years

FIS cited Mr A Volynets director general on strategy and corporate development of Rusal's as saying that United Company Russian Aluminum suspended the Komi Aluminum project for two years because it failed to find access to an energy source.

As reported earlier, Komi Aluminum is included in the list of Rusal's priority projects as it strengthens the resource base of the company and is a key element for the implementation of projects on opening of new aluminum capacities in Russia.

The complex in Komi was projected to be put into operation in 2009. Its startup would allow the company to increase alumina production in Russia by more than 40%.

EBRD plans to invest USD 1 billion in Ukraine in 2008

Ukrainian Journal Staff reported that the European Bank for the Reconstruction and Development could invest USD 1 billion in Ukraine in 2008.

Mr Jean Lemierre president of EBRD said "One billion dollars is the investment we are planning for this year. We have set plans to invest large sums, if we're able to do this."

Mr Lemierre said that the increase in EBRD activities in Ukraine mainly depends on the terms of approval resolutions by the cabinet and Parliament.

Gazprom sanctions to affect Naftogaz Ukrainy

Itar-Tass quoted RosUkrEnergo said that Russian Gazprom’s decision to reduce gas supplies to Ukraine by 25% would affect primarily and solely Naftogaz Ukrainy.

Mr Andrei Knutov spokesman for RosUkrEnergo said that Naftogaz Ukrainy had been using gas in necessary volumes since January 1st 2008 but does not have even one contract with the suppliers of imported natural gas.

He said the reduction of gas supplies should not affect URGAZ-ENERGO which in turn has effective contracts with industrial consumers in Ukraine.

RiosUkrEnergo urged Naftogaz Ukrainy to perform its obligations regarding the use of gas from underground storage facilities in Ukraine in strict compliance with requests. It also stressed that unauthorized siphoning of gas belonging to RosUkrEnergo would be unacceptable.

Ukraine gas transit to Europe increases in 2 months

Interfax reported that natural gas transit through Ukraine to Europe rose to 22.3 billion cubic meters in the first two months of the year up by 22.6% over the same period last year.

The report said the substantial increase in gas transit volumes from Gazprom since the beginning of 2008 once more demonstrates the constructive position of Naftogaz Ukrainy in the negotiating process aimed at defining the terms of gas imports to Ukraine and its transit through our country. Transit to CIS countries in the period was unchanged from the year earlier period and amounted to 0.7 billion cubic meters.

Naftogaz Ukrainy subsidiary Ukrtransgaz also provided transportation of 16.1 billion cubic meter of gas for domestic consumers in the two month period an increase of 10.3% or 1.5 billion cubic meters over the same period a year earlier.

Natural gas transportation to Europe amounted to 112.1 billion cubic meter in 2007 up by 1.5% or 1.7 billion cubic meters over 2006. Gas transit to CIS countries declined by almost 80% or by 11.7 billion cubic meters to 3.1 billion cubic meters.

Naftogaz Ukrainy provides gas transit services to Gazprom and Switzerland-registered RosUkrEnergo AG in which the Russian gas giant owns a 50% stake.