TATA Steel new BF blown in

It is reported that TATA Steel has commissioned its new 3800 cubic meter blast furnace No H at its Jamshedpur works in Jharkhand on May 31st 2008. Mr RS Pandey India’s steel secretary performed the formal Blow In Ceremony. Mr B Muthuraman MD of TATA Steel, Mr HM Nerurkar COO of TATA Steel, Mr RP Singh VP engineering & projects of TATA Steel, Mr Basevi MD of Paul Wurth Italia and Mr KG Hariharan senior executive VP of L&T were present in the Blow In Ceremony.

TATA Steel has embarked on growth plan to increase its Jamshedpur Works Capacity to 7 million tonnes per annum in Phase 1 and to 10 million tonnes per annum in Phase 2. And H BF marks the completion of the most important milestone in that journey. It has been designed, supplied, erected and commissioned by a consortium consisting of PW Italia, L&T, PW India, and PW Luxembourg.

The foundation stone for this 2.5 million tonne BF was laid in June, 2006. The project broadly involved a total of 80,000 cubic meter of civil work, 28,000 tonnes of structural work, 20,000 tonnes of equipment erection, 22,000 tonnes of refractory work and 1.5 kilometers of rail track and 1500 kilometers of electrical cabling involved. All the shells and major pipe line were fabricated in house by Growth Shop of Tata Steel and most of the equipments have been procured from reputed OEMs Overseas. The whole plant has been designed within an area of 63 acre due to space constraints and this is an engineering marvel. Also the project has been completed in 25 months from the groundbreaking which is the shortest possible time ever taken for construction of such a large furnace anywhere in the world.

H BF will produce over 7200 tonnes of hot metal per day with a coke rate of 380 kilogram per tonne of hot metal and coal injection rate of 160 kilogram per tonne of hot metal. The furnace is equipped with all modern features. It has two flat cast houses with four tap holes. Cold blast will be made available by electrically driven blowers. Energy in terms of electrical power will be recovered from the BF gas through an expansion turbine. The waste heat from the stoves’ exhaust will be recovered to save on the fuel rate of the furnace. The Slag generated will be supplied for Cement Manufacturing in granulated form.

Mr B Muthuraman said that “It is a historical day not only for TATA Steel but also for the nation. I would like to thank Mr RS Pandey, who came to Jamshedpur to be a part of this momentous day. The blow in of H Blast Furnace is a major milestone and another giant step in making India prosperous. It is India’s largest blast furnace and it is an effort by TATA Steel to add tremendously to the nation building process. Steel is the back bone of the country and we want to ensure that India does not miss the bus. I would like to thank the entire team for completing the project in record time.”

Mr RS Pandey said “It is the largest blast furnace that has been completed in 25 months. It will work efficiently and pave the path for the construction of more blast furnaces. I would like to extend my congratulations to the entire team for achieving this remarkable feat. I get the reassurance that Tata Steel will continue to play a pioneering role in the process of steel making”

Change in export duty on steel likely to come this week

It is reported that a high powered Committee of Secretaries has decided to amend recently imposed export duty on steel products.

The report cited a top level government official as saying that "Export duty on steel products, including high value steel items is getting rationalized. The committee of secretaries has taken a decision."

He added that the duty on all but a few primary and semi finished steel products will be removed. The department of revenue has also agreed to the proposals of the steel ministry and next week it will issue the notification.

The committee of secretaries' decision follows representation from the steel ministry to consider withdrawal of export cess on steel products. The issue was also discussed earlier by steel producers with Dr Manmohan Singh. At the meeting, there was a broad agreement that export cess on steel would be withdrawn as the steel industry has reduced prices to support the government’s inflation control initiative.

RINL hopes to merge with NMDC

SNS reported that a proposal to merge Rashtriya Ispat Nigam Limited and National Mineral Development Corporation Limited has been mooted by Mr PK Bishnoi CMD of RINL.

Mr Bishnoi said that “Since NMDC has iron ore and wants to foray into steel making and RINL does not have iron ore but has expertise in steel making, a merger of the 2 entities will be beneficial for both as well as for the nation. The merged entity could ramp up steel production capacity to 20 to 25 million tonnes by 2020.”

He added that "The merger would enhance operational efficiencies. We have 22,000 acres of land, port, technology, manpower all we need is iron ore."

He said that the idea first germinated after the shelving of the proposal under which NMDC, SAIL and RINL were to set up a 3 million tonne capacity steel plant in Chhattisgarh. Later, RINL and SAIL withdrew from the project and NMDC is now implementing it on its own.

Meanwhile, Mr Rana Som chairman of NMDC said that "It is a hypothetical situation. I can not comment on it immediately."

TATA Steel sees Indian steel imports at 25 million tonne level

Indian steel giant TATA Steel sees that India may have to import 25 million tonnes of steel within the next five years if the present demand supply mismatch continues

Mr B Muthuraman MD of TATA Steel while speaking at the commissioning ceremony of BF No H said "Consumption of steel is going up by 8 million tonnes to 10 million tonnes per annum. This will continue for several years. If this continues, we may have to import 25 million tonnes of steel in the next five years.”

Steel demand supply gap in India on the rise

It is reported that Indian government is concerned over the increasing gap between demand and supply of steel in India, and sees that the situation is going to become worse in next few years.

Mr RS Pandey India’s steel secretary on the sidelines of the blow in ceremony of TATA Steel’s BF H at Jamshedpur expressed concern over lagging steel production in India against rising consumption.

Mr Pandey told reporters that India had emerged as a net importer of steel for the first time in 2007-08 and the situation is going to worsen in the next two to three years.

Mr Pandey said that all estimates regarding consumption and production had gone haywire, pointing out that while consumption was estimated to grow at 3% and production at 7%, it had been seen that consumption growth had outstripped demand. He expressed concern that capacity creation had been stuck in many places.

He said that the government would take steps to facilitate expeditious addition to steel capacity, which was estimated to touch 124 million tons by 2011-12. He said “All roadblocks would have to be removed. By 2015-16, India will emerge as the number two steel producers in the world."

Sterlite to acquire operating assets of Asarco for USD 2.6 billion

Sterlite Industries India Limited announced that it has signed a definitive agreement to purchase all the operating assets of Asarco, a Tucson based mining, smelting and refining company, for USD 2.6 billion in cash.

Asarco, formerly known as American Smelting and Refining Company, is currently the third largest copper producer in the United States of America. Asarco produced 235,000 tonnes of refined copper in 2007 and its mines have an estimated reserve of 5 million tonnes of contained copper. It had total revenues of about USD 1.9 billion, during the year ended December 31st 2007. It filed for bankruptcy protection in 2005 after it was sued for USD 1 billion over environmental and asbestos claim.

The assets to be acquired include three open pit copper mines and a copper smelter in Arizona, US and a copper refinery, rod and cake plant and precious metals plant at Texas in US.

The agreement, which is subject to the approval of the US Bankruptcy Court for the Southern District of Texas, Corpus Christi Division, will conclude Asarco's Chapter 11 case. The company noted that this deal would achieve the overall best value for Asarco, its employees, creditors and the local communities in which it operate.

Sterlite said that this acquisition is on a cash free and debt free basis. The company will finance the asset acquisition through a mix of debt and existing cash resources. Sterlite also stated that it would assume operating liabilities but not legacy liabilities for asbestos and environmental claims for ceased operations.

Mr Anil Agarwal chairman of Sterlite said "We are delighted to have reached agreement on this important acquisition, which is a significant milestone for our Group. This is in line with our stated strategy of leveraging our established skills."

ABN AMRO Corporate Finance acted as financial advisor and Shearman & Sterling acted as legal advisor to Sterlite in this transaction, while Lehman Brothers and Baker Botts acted as financial advisor and legal advisor to Asarco.

Orissa to recommend Khandadhar iron ore mines for POSCO

FE reported that Orissa government is all set to recommend the Khandadhar iron ore mines to South Korean steel major POSCO. Its recommendation letter is likely to be dispatched some time in the first week of June 2008 as all formalities related to the hand over have been carried out.

Official sources said that "Now that the formality is over, the state government will recommend POSCO India to the centre for a prospecting license."

The state government on December 26th 2006 recommended POSCO India to the centre for a license to carry out prospecting over 6204.352 hectares of the Khandadhar mines in Sundergarh district. The centre initially rejected the state government’s recommendation of POSCO. In October 2007, the state government asked the applicants to submit their papers by the end may 2008. There were initially 290 applicants for the mines, before the state government got rid of 53 thus leaving 237 applicants for the mines.

Incidentally Orissa government had given the Khandadhar mines to Kudremukh Iron Ore Company Limited for prospecting. 3 years ago, KIOCL negotiated for a mining lease and entered into an agreement with Kalinga Iron Works to set up a pelletization plant. KIOCL has invested INR 1.6 crore on drilling and prospecting Khandadhar mines. But the state government recommended POSCO for a prospecting license instead of KIOCL, which challenged the state government’s decision in the Orissa High Court.

Indian government to approve 4 more UMPP

BL reported that union power ministry has decided to put up 4 more additional ultra mega power projects 1 each in Chhattisgarh, Orissa, Tamil Nadu and Gujarat as these states have sent their renewed requests to union power ministry for which the Group of Ministers in its recent meeting has also approved much higher gas allocation for its power plants.

Mr Sushilkumar Shinde union power minister said that the ministry would receive quantities for additional allocation of gas for power plants that have become idle for want of gas through an official communication any day. He, however, further disclosed that in totality, the government has approved nearly 9 ultra mega power projects of which 3 are under execution and only a few days ago, it received a new request from Chhattisgarh, Orissa, Gujarat and Tamil Nadu for ultra mega power projects to meet the power shortages.

Mr Shinde said that "So in totality, there would be 13 ultra mega power projects that will come during the 11th plan period as against 9 already approved."

He added that the approval process for ultra mega power projects would be affected shortly to ensure that the shortage of nearly 30,000 MW of power being experienced currently at different places is addressed.

HZL lowers zinc prices by INR 5,800 per tonne

PTI reported that Hindustan Zinc has cut lead product prices by INR 5,800 a tonne to INR 98,400, while lead prices have been reduced by INR 4,000 a tonne to INR 99,900.

Hindustan Zinc reviews its product prices every Thursday and Saturday to keep them in line with prices on the LME. The cut in the prices is on the back of weakening prices on the LME.

Pencil ingots firm in futures market

BL reported that prices of mild steel ingots were trading firm in the futures market on the back of increase in global demand. In the June 2008 contract on NCDEX, mild steel ingots were up by INR 550 or 1.73% at INR 32,430 per tonne. July 2008 contract was up by INR 590 or 1.83% at INR 32,830 per tonne.

Mr Tarun Satsangi head of brokerage firm Commodity Research said that this upward trend is on account of rising global demand, especially from China, which is likely to go up by 8.6% and the Asian demand, which may go up by 11.5%. He added that a slight decrease in supply from China coupled with rising construction activities in the Middle East and other Asian countries also pushed up the prices in the domestic futures market.

Mr G Harish analyst at Karvy Comtrade said that the upward sentiment is continuing from the last few days and market speculations that the government is likely to increase iron ore prices further added to the upward movement of mild steel ingots.

Indian inflation crosses 8% mark

It is reported that India’s inflation has galloped to a 45 month high of 8.1%, whipped up by costlier edibles and industrial fuel as government measures appeared to have little control on rising prices.

Inflation, measured on wholesale prices, was 8.1% for the week ending May 17th 2008 from 7.82% in the previous week. The last high, as per provisional figures, was 8.33% in the week ended August 28th 2004.

With a hike in retail fuel prices around the corner, Mr P Chidambaram union finance minister said that the impact of any increase in petrol and diesel prices would be short lived. He added that "8.1% inflation is worrisome."

Since the March 31st 2008 decision of the cabinet committee on prices to slash import duty on edibles oils and ban export of non basmati rice to contain inflation, government has unveiled numerous measures to tame price rise. It had also goaded steel and cement manufacturers to cut and hold prices for up to 3 months.

Incidentally, cement and steel prices came down by 0.6% each during the week under review. In industrial fuel, furnace oil was dearer by 3%, light diesel oil by 2% and coke 31%.

Mr Koda blames TATA Motors for gas leak

Ranchi Express reported that Mr Madhu Koda chief minister of Jharkhand accompanied by Mr Sudhir Mahto deputy chief minister has ordered the East Singhbum district administration to lodge an FIR against TATA Motors for gas leak at the TATA Motors water filter plant.

Mr Koda, who visited the gas leaked site in the water filter plant of TATA Motors, has termed the incident a clear case of negligence as the cylinder chlorine gas was kept in the plant last ten years though it was not in use for long time now.

Mr Koda said that "There is no any need to have any enquiry. Things are clear here. It is simply a case of serious negligence and the people responsible for this should be booked straightway. Lodge an FIR and arrest the culprit who played with lives of people. Send them to jail."

As per report, a total of 180 people had to be hospitalized in the wake of the incident through barring all others have been released from the hospital at the time of filling this report. 21 patients were released from the hospital recently.

Mr S Majumdar takes additional charge as CMD of PGCIL

Power Grid Corporation of India Limited has informed BSE that Dr RP Singh, on acceptance of his resignation by President of India, communicated vide office order dated May 30th 2008 of ministry of power, has relinquished the charge of post of CMD of Power Grid with effect from May 30th 2008 and handed over the charge to Mr S Majumdar director projects.

In pursuance of the said order, Mr S Majumdar has assumed the additional charge of the post of CMD for a period of 3 months or until further orders, whichever is earlier.

Commissioning of Gangavaram port delayed

According to a spokesman for Rashtriya Ispat Nigam Limited, the commissioning of Gangavaram port, due in June 2008, will be delayed. He said that "We are not sure if it will be ready before the end of the monsoon."

The conveyor system, it was indicated, is not ready yet. The construction of the berth is ready but certain small jobs still remained to be done.

Gangavaram port authorities are yet to settle the issue of port charges with RINL authorities. The spokesman said that "Discussion in this regard is in progress, and hopefully, we will arrive at a settlement within a month or so. Each side is trying to extract as much as possible from the other."

Since there would be mechanical handling facility at Gangavaram port, the spokesman hoped that the daily discharge of imports there would be at least 50,000 tonnes compared with 15,000 tonnes at Visakhapatnam port at present.

It may be noted that RINL will be the major user of the port. An estimated 4 million tonnes of RINL’s imports annually, comprising about 3.3 million tonnes of coking coal and another 0.8 million tonnes of limestone currently being handled at Visakhapatnam port, are supposed to be diverted to Gangavaram port when commissioned. The throughput will rise with the capacity expansion of the Vizag steel plant to 6.2 million tonnes in 2011-12 and further to 16 million tonnes in 2020.

The import is to be transported from the port to the RINL plant by a conveyor system to be constructed by the port.

Small users in TN protesting against raw material price surge

It is reported that small entrepreneurs in Tamil Nadu are up in arms against the rise in prices of raw materials including steel. The members of the industry under the aegis of Tamil Nadu Rural & Micro Entrepreneurs Association held a day long fast here to attract the attention of the centre.

Mr AS Kannan president of the association said that the rural and micro enterprises that use plastic, steel, pig iron, aluminum and copper as raw material are hit by the prices of these commodities. He added that the rise ranges between 40% and 60% in most cases.

While protesting against export of steel, metals and their raw materials from India, Mr Kannan also urged the centre to extend freight subsidy for these raw materials to provide a price cushion for these units.

The protestors are also demanding the Tamil Nadu government create micro industrial estates in key industrial cities and allot work sheds to tiny entrepreneurs in such exclusive industrial estates so that these units can shift out of the crowded residential areas.

Urging the government to offer concessional electricity to micro units on the lines given to the power loom weavers, the association called upon the Tamil Nadu government to take up with the Centre a scheme of loan waiver for the micro enterprises as many of the small and tiny units which have outstanding loans with cooperative or rural banks are unable to repay these loans due to adverse working conditions.

Action plan for making national waterways fully functional

An action plan has been prepared at an estimated cost of INR 751 crore for making the 3 national waterways fully functional. These are
1. 1620 kilometers long Allahabad Haldia stretch of Ganga Bhagirathi Hooghly river system
2. 891 kilometers long Sadiya Dhubri stretch of Brahmaputra River
3. 205 kilometers long Kottapuram Kollam stretch of West Coast Canal along with Champakara Canal and Udyogmandal Canal

Under this action plan, specific projects have been identified for development of fairway, navigational aids, terminals, procurement of vessels namely dredgers and survey launches cargo vessels etc.

The action plan is targeted for providing

1. Fairway with 3 meter, 2 meter, 1.5 meter depth in national waterways 1, 2 meters, 1.5 meters depth in national waterways 2 and 2 meters depth in national waterways 3.

2. A judicious mix of fixed and floating terminals with mechanized handling facilities and access and egress by road or rail.

3 Facilities for day ad night navigation

4. Some vessels for developmental works and also for operating demonstrative cargo services.

The action plan envisages fund requirement of INR 751 crore. Considering that after making the waterways fully functional also, it might take some more time for the private sector to become encouraged enough to invest in acquiring and operating vessels for transportation of cargo and therefore, the action plan includes demonstration voyages fixed schedule sailings for about 3 to 4 years with viability gap funding.

CST rate to be cut to 2% from June 1st 2008

BS reported that after much bickering with states, union finance ministry has reduced the central sales tax rate on inter state sales from 3% to 2% with effect from June 1st 2008.

Central sales tax was cut from 4% to 3% on April 1st 2007. It was to be reduced to 2% on April 1st 2008 and phased out by March 2010. However, the reduction to 2% got delayed after states refused to increase the value added tax rate from 4% to 5% and bring textiles under VAT.

Sources said that states were now refusing to do so citing high inflation and the coming assembly elections. States are now demanding cash compensation from the central government.

Non reduction in the central sales tax rate would have embarrassed both the central and state governments, who are working together to introduce a uniform goods and service tax by 2010 by eliminating central sales tax.

Chennai box terminal gets 22 suitors

BL reported that large Indian companies and global container terminal operators have evinced keen interest in developing the INR 3,105 crore mega container terminal at Chennai port.

As per report, Larsen &Toubro, Reliance Industries, IL&FS, IDFC Projects, Navayuga, GVK and global terminal operators such as AP Maersk, CMA CGM and DP World are among the 22 companies that participated in pre application meeting on the project that is planned to come up in the Outer Harbor, north of the port’s Bharathi Dock.

The project will be developed on a build, operate and transfer basis and will have a 2 kilometers long quay with an alongside depth of 22 meters. The terminal will be able to handle ultra large container ships of 18,000 TEUs.

Meanwhile, Chennai Port Trust has extended the bid submission by a month to July 30th 2008.

First 500 MW unit of NTPC Sipat reaches full load

It is reported that the first 500 MW unit of National Thermal Power Corporation’s giant power project at Sipat in Bilaspur district of Chattisgarh went on full load, almost a full year after it was declared commissioned. It will go fully commercial in about 3 weeks’ time.

The second 500 MW unit is expected to go fully commercial by October 2008. Both the 500 MW units use boilers and turbines manufactured by BHEL. The two 500 MW units form stage II of the project, while 3 supercritical 660 MW units form Stage I. The boilers for these 660 MW units are being supplied by Doosan and the turbines by the Russian firm Power Machines.

Mr Ramesh expressed his deep concern that stage I has been badly delayed by well over two years. He said that he had personally met with the top management of power machines very recently in a bid to expedite the commissioning and it is now expected that the first 660 MW unit, which will also be the first supercritical unit in the country, will be commissioned by March 31st 2009 and go commercial 3 to 4 months thereafter. He also said that he had held detailed review meetings with NTPC and asked it to resolve all long standing contractual disputes with Doosan and Power Machines expeditiously and amicably.

He also underscored the urgent need to change the definition of commissioning. He said that presently, a power project is considered commissioned when it is simply synchronized on oil, well before the other stages of synchronization on coal, full load operation, trial operation and commercial operation declaration.

Mr Ramesh thanked Chhattisgarh chief minister Dr Raman Singh for his cooperation in getting the prestigious Sipat project going by providing water from the Hasdeo Banjo project as originally planned.

L&T 2007-08 Q4 net profit up by 38% YoY

Larsen & Toubro has posted net profit of INR 966.76 crore in January to March 2008 quarter up by 38% YoY as against INR 700.77 crore in January to March 2007 quarter, helped by a one time gain and new orders from the oil sector. Sales rose by 36% YoY to INR 8,466.87 crore.

L&T is bagging more orders as India plans to spend more than USD 500 billion to build roads, ports and power plants in an attempt to spur the pace of economic growth to 10%. It is securing more orders from West Asia which is expanding construction and other related infrastructure helped by demand for oil and related petrochemical products. Total orders rose to INR 53,000 crore in January to March 2008 quarter from INR 45,000 crore.

Mr AM Naik chairman of L&T said that "It expects a 30% to 35% growth in revenues in the current financial year as the current order book execution spans over 18 months.''

Mr Naik said that L&T expects to grow faster in West Asia to offset any demand slowdown in India. It seeks to boost the share of its international revenue to 25% in the next two years. L&T could raise prices for as many as 60% of its orders due to increase in raw material costs. It has set up 3 units to win orders in the power, shipbuilding and railway sectors.

L&T's Dubai subsidiary, Larsen & Toubro International FZE, had recently announced that it incurred losses from hedging commodity prices. It had losses of about INR 200 crore in the last financial year because prices of copper, zinc and other commodities it bet on fell. The loss on hedging commodities has figured in the consolidated account of the group.

Adani Logistics to commence operations at ICD Patli

Exim News Service reported that Adani Logistics has obtained the consent of the customs department to kick start its operations at the inland container depot at Patli in Haryana. With the opening of its first inland container depot, Adani Group has completed the full chain of logistics solutions and is now quite capable of providing integrated land, air and sea connectivity. Customers can avail of the integrated facility of the single window services at Adani Logistics Park, including customs clearance.

As per report, Mr Mohan Lal assistant commissioner of customs took charge at Adani Logistics Park and started regular customs related business on May 27th 2008. The well developed logistics park is equipped with all facilities to handle export import cargoes.

Mr Yogendra Sharma CEO of Adani Logistics Limited said that "Our endeavor is to provide quality services at the state of the art Logistics Park at Patli, which is equipped with a computerized terminal operating system and SAP enabled services."

Adani Logistics Park is expected to have a handling capacity of up to 200,000 TEUs annually after completion of the first phase of operations.

Inland container depot Patli is claimed to be the biggest privately owned terminal in India. It will also cater to the needs of SEZs in the vicinity as it has distinct advantage of proximity over the other inland container depots in Northern India. It also provides ceaseless connectivity to any gateway port and is capable of handling even double stack container trains to Mundra Port.

Punj Lloyd announces 2007-08 fiscal results

Punj Lloyd Limited has announced the following results for the quarter & year ended March 31st 2008

The unaudited results for the January to March 2008 quarter

Punj Lloyd has posted a net profit of INR 1297.10 million for the January to March 2008 quarter up by 459.5% YoY as compared to INR 231.80 million for the January to March 2007 quarter. Total income has increased from INR 8193 million for the January to March 2007 quarter to INR 15065.70 million for the January to March 2008 quarter.

The audited results for the year ended March 31st 2008

Punj Lloyd has posted a net profit of INR 2214.40 million for the year ended March 31st 2008 up by 259.5% YoY as compared to INR 615.90 million for the year ended March 31st 2007. Total income has increased from INR 23054.80 million for the year ended March 31st 2007 to INR 45417.60 million for the year ended March 31st 2008.

The unaudited consolidated results for January to March 2008 quarter

Punj Lloyd has posted a profit after minority interest and share of profits of associates of INR 1177.40 million for the January to March 2008 quarter up by 32.3% YoY as compared to INR 889.30 million for the January to March 2007 quarter. Total income has increased from INR 17199.10 million for January to March 2007 quarter to INR 23284.00 million for January to March 2008 quarter.

The audited consolidated results for the year ended March 31st 2008

Punj Lloyd has posted a profit for the year after minority interest and share of profits of associates of INR 3584.20 million for the year ended March 31st 2008 up by 82% YoY as compared to INR 1969.30 million for the year ended March 31st 2007. Total income has increased from INR 52059.60 million for the year ended March 31st 2007 to INR 78339.90 million for the year ended March 31st 2008.

Shreyas to ramp up car shipping business

DNA Money reported that, 6 months after starting a venture with Maruti Udyog for transporting Maruti cars from Gurgaon to Kochi through the coastal route, Shreyas Shipping Logistics is exploring opportunities to ramp up the service.

As per report, Shreyas Shipping is in talks with TATA Motors, General Motors, Mahindra & Mahindra, Hyundai and Honda for similar ties. It is looking to provide inter modal logistic services to other companies also.

Mr Anil Devli executive director of Shreyas said that "We definitely want to expand this service this year and provide complete logistics to vehicle operators’ right from their factories to the distribution centers. Cars from the Halol plant could be transported to the Mundra Port in Gujarat and then shipped to Kochi via coastal shipping."

Shreyas Shipping has already given trial runs to TATA Motors and is in various stages of talks with other companies. It hopes to strike a deal soon with General Motors as the automobiles firm has a manufacturing plant in Halol in Gujarat.

Traditionally, cars have been transported in open car carriers by road, which leads to damages and is time consuming. However, now with the growing demand of cars and other vehicles in the southern states, manufacturers are looking at alternative routes for transporting vehicles. Some operators have also started using the railways to transport cars packed in containers.

Shreyas Shipping, which operates in coastal shipping and feeder services, has a fleet of 22 ships and has 1 new built ship on order in a Singapore yard. Although it has no plans to acquire more ships for this purpose, the idea of a roll on roll off ship is certainly not out.

Lanco Infra plans USD 8 billion CAPEX over next 3 to 4 years

Lanco Infratech has posted net sales of INR 1224.9 crore for January to March 2008 quarter up by up 150% YoY as against INR 489.47 crore in January to March 2007 quarter. The operating margins are at 20.98% as against 24.8%, while the profit after tax is up by 180% YoY at INR 159.46 crore as against INR 56.9 crore.

Mr J Suresh Kumar CFO of Lanco Infratech said that its order book was just about INR 1,600 odd crore one and a half year back and today, it is at INR 13,500 crore.

He added that "We see at least USD 7 to USD 8 billion CAPEX plans over the next 3 to 4 years, which will come through including what we are doing in the port project as well as in the power projects that we are executing and are in various stages of development."

L&T to unveil INR 2,500 crore CAPEX this fiscal

PTI reported that Larsen & Toubro Limited is planning to invest INR 2,500 crore during the current financial year to augment capacities at its growth centers.

Mr JP Nayak member of board & president operations at L&T said that the money would be spent on augmenting facilities at all the locations and for setting up a ship building yard at Tamil Nadu. He added that it is expecting a sales growth of 30% during the current financial year.

Mr Nayak said that the 51:49 JV between L&T and Mitsubishi Heavy Industries for manufacture of super critical boilers and turbine generators would be operational within the next 12 to 18 months. He added that investments in the 2 JVs would be around INR 1,000 crore each. L&T is also executing INR 3,000 crore in projects in the eastern region, particularly in the steel sector.

M&M defers tractor manufacturing plant at Chennai

BS reported that Mahindra & Mahindra has deferred its plan to build an INR 400 crore tractor facility in Chennai on apprehensions that tractor sales may slow.

Mr Anjani Kumar Choudhari president of farm equipment sector at Mahindra & Mahindra said that "We have postponed our plans for an integrated plant in Chennai which was supposed to come up inside the company's research facility following the downturn in the industry." He added that it expects tractor facility in Chennai to produce 145,000 units a year.

Mr Choudhari said that "The reason we wanted to set up a base in Chennai was because of the relative lower presence of our brand in the southern market. We have facilities in the north, central and the west but not in the south."

Punjab Tractors Limited, which was bought over by M&M in 2007 for nearly INR 1,400 crore, has huge spare capacity at its plant. The brand produces just 28,000 tractors currently, less than half of its total installed capacity of 60,000 units a year.

According to the latest figures for April 2008 provided by M&M, it saw a decline of 4.20% YoY in sales, selling just 8,679 units against 9,060 units in the same month of the previous year.

Mundra Port & SEZ Limited 2007-08 net profit up by 12% YoY

Mundra Port & SEZ Limited has posted profit after tax of INR 210.42 crore for 2007-08 fiscal up by 12% YoY as against INR 187.17 crore in 2006-07 fiscal, while its revenues went up by 44% YoY to INR 844.92 crore as against INR 586.95 crore.

During the year ended March 31st 2008, Mundra Port & SEZ Limited completed its initial public offering to raise INR 1,771 crore and allotted 40.25 million equity shares of INR 10 each at a premium of INR 430 a share.

Measures by Indian government to curb rise in steel price

Indian government through the initiatives by Mr Ram Vilas Paswan union minister of steel has tried hard to control the surge in domestic steel prices in India by meeting all the steel makers and announcing major policy decisions in last few months. The details of meetings and outcome in brief are as under

1. February 14th 2008 - During the interaction with major steel makers an appeal was made to review their last round of rise in price and in response to the appeal steel producers like SAIL, TATA Steel and JSPL rolled back prices by INR 1000 per tonne for TMT, rounds and bars and INR 500 per tonne for other steel products.

2. March 3rd 2008 - Steel Minister held discussion with all major steel investors including ArcelorMittal, POSCO, TATA Steel, Essar, Ispat and also SAIL, RINL to explore the possibility of expediting the ongoing as well as envisaged steel projects.

3. April 2nd 2008 - Ministry of steel held discussions with major steel producers assess the situations arising out of the rising steel prices

4. April 3rd 2008 - Ministry of steel held discussions with secondary steel producers to assess the situations arising out of the rising steel prices

5. May 1st 2008 - Another round of discussion with iron ore producers was held jointly by secretary steel and secretary commerce.

6. May 7th 2008 - The CEOs of major steel producing companies, namely, Steel Authority of India Limited, Tata Steel, RINL, JSW, Essar Steel, Ispat Industries Ltd. and representative of Jindal Steel & Power Limited met the Hon’ble Prime Minister and shared the government’s concern regarding the inflationary situation in the country and in accordance with the Prime Minister’s advice to contain prices, decided to take some measures

As a result of these discussions, Indian steel makers agreed to following cuts

1. Rashtriya Ispat Nigam Limited and TATA Steel agreed to roll back the prices of long products by INR 2000 per tonne;

2. The steel producers agreed to cut back the price of galvanized corrugated sheets by INR 500 per tonne.

3. Those producers, who have increased the prices in April, reduced the prices of flat products by INR 4000 per tonne. In addition, prices of rebars and structural where no increase was affected in April and May was also be reduced by INR 2000 per tonne.

4. These reductions will be applicable for all steel that gets consumed in India either directly or after further processing.

5. The Steel Producers will hold these prices for the next three months.

The steel makers also agreed to the following
1. Steel producers agreed to exercise restraint on export of steel products
2. The major producers agreed on a transparent pricing system through regular updation on their website.
3. The major producers agreed to increase allocation of steel to small and medium enterprise through the SSICs and NSIC, by 20% from 049 million tonnes to 0.6 million tonnes for 2008-09.
4. In addition to existing rebate of INR 550 per tonne provided out of Steel Development Fund, INR 400 per tonne of steel delivered to the SMEs through SSICs or NSIC will be borne by the producers towards defraying the cost of transportation to SMEs. 5. The steel producers agreed to enter price contracts for deliveries to SMEs for at least three months and directly service even smaller quantities to SMEs.
6. Similarly, the secondary producers also agreed to pass on any reduction in duty and taxes announced by the government, to the customers. The secondary producers also agreed to cut the prices of bars and rods.
7. The iron ore producers agreed to consider the reduction in iron ore prices and later informed about a reduction of the spot price of iron ore by INR 200 to INR 300 effective from second weeks of April 2008.

Indian government also took various fiscal and other measures for stabilizing the steel prices like exempting pig iron, non alloy steel and steel making inputs like zinc, ferroalloys and coke from customs duty; withdrawing DEPB benefits on export of various categories of steel products and bringing back railway freight on iron ore from classification 180 to 170 for domestic steel producers. In May, the Government imposed 15% export duty on semi finished products and hot rolled coils or sheet, 10% export duty on cold rolled coils or sheets and pipes, tubes and 5% export duty on galvanized steel in coil or sheet form in order to further curtail rising prices and increase supply of steel in the domestic market.

There has been an up trend in the domestic steel prices since 2006-07 and the trend accentuated since January this year. In between January and April this year the price of pig iron went up by more than 70%, construction steel like TMT and wire rods went up by more than 36% and HR coils went up by more than 40%. Rise in raw material prices, strong demand in the international and domestic market and up trend in the global steel prices have been some of the reasons cited by the industry for increase in the steel prices in the domestic market. The mismatch in demand and supply is considered to be the main reason on the demand side for the rise in steel prices.

RCG opens office in India

It is reported that steel consultancy major Research & Consulting Group AG has opened an office at Mumbai in India in the beginning of May 2008. With the opening of Mumbai office, it has set footprints in almost all developed as well as emerging markets with offices at Düsseldorf in Germany, Kiev in Ukraine and Joint ventures in Brazil, China and Dubai.
As per report, it has registered a firm in India and has deputed Mr. Robert Meyer VP Asia to head the operations. RCG is eying emerging steel market in India to leverage its expertise in steel marketing filed and is also planning to use this office as global research center.

Mr Joachim Schroeder CEO of RCG said that “Establishing an additional office in India is the next logical step in our company development and philosophy. RCG wants to be close to the clients and due to the globalization in the steel industry we have to be present in each of the major steel regions worldwide. We are very keen to contribute to India’s future steel industry development.”

Mr Schroeder added that “In addition, we will develop Mumbai office as one of RCG’s major research centers leveraging India’s strong outsourcing perspective.”

Switzerland based Research & Consulting Group is an internationally active consulting firm, specializing in the steel industry as it has acquired profound knowledge of global steel industry through its many years of experience. RCG's clients are internationally operating companies, which are actively facing the challenges of increasingly intensive competition through wide spreading globalization. RCG works out integrated solutions together with its customers tailored to their needs.

Anti POSCO brigade all set for its third anniversary

SNS reported that the anti POSCO brigade is all set to celebrate the third anniversary of their protest movement even as the administration and company are getting ready to expedite the project work.

It may be noted that on June 22nd 2005, a MoU was signed between Orissa government and POSCO. However, the project work is running behind schedule because of the protests. The protest is spearheaded by POSCO Pratirodh Sangram Samiti, which claims it had spoiled company’s proposed foundation stone laying function on April 1st 2008 by successfully organizing the samavesh at Balithuta. As the government and the company are reportedly planning to lay the foundation stone during the last week of June 2008, the outfit now exudes confidence that it would spoil the face saving measure this time too.

Sources said that PPSS has solicited cooperation from various organizations, political parties, social activists and environmentalists ensure success of the protest. Meanwhile, 12 members of Bhusan coal mining sangharsa samiti led by Mr Radhasyam Baurdhia visited Dhinika, Patana and Govindpur village and interacted with members of PPSS.

They have reportedly committed to send hundreds of supporters from neighboring states like Chhattisgarh, Jharkhand, Bihar and Madhya Pradesh to join this protest meeting and other programs for protesting POSCO steel project.

The members also attended the public meeting at Dhinika, Gobindpur and urged upon the villagers to be united in fighting POSCO’s moves. They expressed that Sangharsa Bahinis have not allowed Bhusan company to lift coal from the mines area at Jamkina of Orissa Chhatisgarh border. They praised PPSS activists for not allowing POSCO to start its project work at Dhinika.

Everest Kanto 2007-08 PAT up by 45% YoY

Everest Kanto Cylinder Limited recently announced its audited financial results for the year ended March 31st 2008.

As per the audited results, the total sales revenue for the year was recorded at INR 528.74 crore up by 24.4% YoY and profit after tax was at INR 104.27 crore up by 45% YoY.

The said profit after tax is after providing for foreign exchange derivative loss of INR 8.22 crore which occurred due to the fall in the US Dollar vis a vis other major currencies. It is also after a past year's one time tax adjustment of INR 3.32 crore.

SAIL BSL wins AIMA zonal business award

Ranchi Express reported that Steel Authority of India’s Bokaro Steel Plant team has won the zonal award for business management simulation contest, organized by All India Management Association. The BSL team outshone representatives of 29 reputed companies to bag the western zone winner award.

BSL had sent 4 teams as representatives at different zonal level competitions. The team including Mr C Srikanta deputy GM, Mr A Prakash and Mr Alok Verma senior managers and Mr S Sengupta deputy manager, emerged as the winner.
The wining team met senior executives of BSL including Mr V K Srivastava MD and executive directors Mr Jeevesh Mishra and Mr KSR Marti. Mr Srivastava wished the team good luck for future competitions at New Delhi on June 14th 2008.

The top two teams of the will get an opportunity to represent India in the As an Management Games 2008, The best team of the AMG would go on to contest in the Global Management Challenge 2008.

NTPC 2007-08 fiscal PAT up by 8.01% YoY

National Thermal Power Corporation Limited has announced results for the January to March 2008 quarter. The sale of energy for the quarter is up by 21.39% YoY.

NTPC has declared audited net sales of INR 37,050 crore during 2007-08 up by 13.67% YoY as against INR 32,595 crore. The gross revenue crosses INR 40,000 crore during 2007-08 up by 13.11% YoY.

Profit after tax for the year 2007-08 is INR 7,415 crore up by 8.01% YoY as compared to INR 6,865 crore during the year 2006-07. Adjusted audited profit after tax is INR 7,569 crore up by 15.35% YoY as against INR 6,562 cores for 2006-07.

DPR for Nani Naroli power plant by June 2008

BL reported that the detailed project report for Gujarat Industries Power Company's 500 MW lignite based power plant at Nani Naroli in Surat district is under examination and the environmental report will be ready by early June 2008.

The project will entail an investment of INR 3,000 crore. Work on the project is likely to commence by September 2008 and will be operational by 2012.

Bids re evaluated for Sewri Nhava sea link project

BL reported that Maharashtra government is re evaluating bids given by consortium led by Reliance Energy and Sky Infrastructure for the development of the Sewri Nhava sea link project, also called as JRD TATA Bridge.

As per report, the consortium led by Reliance Energy had quoted a concessional period of almost ten years, while Sky Infrastructure has sought a concession period of 75 years before the bridge is handed over to the government. After a pitched legal battle REL, which was initially not allowed to participate in technical bidding for the project, was allowed to submit their proposal. After the financial bidding, the project was awarded to the REL.

The sea link project to link Nhava in Raigad district will be built at an estimated cost of INR 5,000 crore and the private builder can recover costs through toll collected during the concessional period.

TATA rural BPO to come up near steel site in Orissa

BS reported that, in a conciliatory move towards educated locals who are agitating against TATA Steel's proposed 6 million tonne steel plant in Kalinga Nagar, the TATA group is setting up a business process outsourcing unit on the proposed site.

The rural BPO centre will be established by the TATA Business Support Services in partnership with TATA Steel Rural Development Society. To start with, it is expected to employ around 200 people.

Sources close to the development said that TATA has already recruited the first batch of the executives for the BPO unit, who are expected to undergo two months of training at ATA Business Support Services' headquarters in Hyderabad. ATA Business Support Services has developed a specialized training program in view the fact that most of the new recruits are not computer literate. It currently operates three rural BPO units that employ around 500 people in all.

The centre aims at handling the Orissa region front end and customer support works of group companies including TATA Teleservices and TATA Sky. The BPO unit will also provide services to other firms who have substantial operations in Orissa.

A TATA group executive in charge of human resources development said that "Opening the BPO unit in Kalinga Nagar will provide us access to many educated but unemployed youths in semi urban areas like Jajpur Road and Duburi which have a number of colleges and educational institutions in and around. The education level among the masses in these areas is comparatively high and the aspirations level of the local people is also very high. Although most youths in these areas are interested in higher end and computer related jobs, there was no opportunity in these places."

The group will initially run the BPO unit in the transit houses and rehabilitation set up established by the company in Kalinga Nagar, before moving into a dedicated building in next few months. The centre will start as a voice based BPO with focus on Bengali, Hindi and English languages other than Oriya.

Belgaum foundry cluster to start in August 2008

BS reported that Belgaum will soon have a foundry cluster as the work on the Belgaum Foundry Cluster is nearing completion and is expected to be operational in August 2008. The project started three years ago at an investment of close to INR 25 crore.

The project once completed will benefit 135 foundries and over 1,000 machine shops in and around Belgaum and hundreds of other units in the neighboring towns of Hubli Dharwad, Shimoga, Harihar and even Kolhapur and Shinoli in Maharashtra.

Mr Manoj Kulkarni CEO of Belgaum Foundry Cluster said that foundry units at BFC are expected to produce 160,000 tonnes of castings during the present fiscal, a growth of 60% over 2007-08 and generate a combined revenue in excess of INR 700 crore per annum, a growth of 75%. The exports are expected to touch INR 350 crore per annum, a growth of 700%. It is likely to generate employment to 12,000 persons.

Mr Kulkarni said that the cluster will also have modern software for 3D modeling, simulation and ERP for foundries will be made available to foundries. The foundry cluster will not only help improve the quality standards of material produced here but also protect ecological balance and conserve natural resources apart from growing exports. He added that "Our vision is to make Belgaum Foundry industry a global sourcing hub for castings and machined components by the year 2010. Despite slowdown in manufacturing sector and rising prices of steel and metal scrap we anticipate foundry units will register a healthy growth of 15% to 20% during the current financial year."

Foundry units in and around Belgaum are serving the automobile industry, general engineering and agriculture sectors. Automobile majors like Mahindra & Mahindra, Bajaj Auto, Ashok Leyland, TAFE, Caterpillar and engineering companies like Kiroskar Oil Engines Limited, Alfa Laval and Simpsons are some of the companies sourcing castings from Belgaum. The Belgaum foundries also export to countries like the US, Germany, Belgium and West Asia.

J&K to sign MoU with GAIL for gas distribution network

BS reported that Jammu & Kashmir government will sign a MoU with GAIL India Limited for setting up of a city gas distribution network in the 8 districts of the state.

A source in Consumer Affairs & Public Distribution department said that "GAIL has submitted the revised and the final draft MoU, in connection with the project, to the state. The state law department studied the proposal and suggested minor modifications in it."

This new project will help in promoting usage of natural gas its fractions and polymer products. Subsequently, the state plans to introduce compressed natural gas for automobile use. Two capital cities of Jammu and Srinagar besides Kathua, Udhampur and Anantnag will be the immediate beneficiaries of this project.

The sources said that GAIL experts have already conducted a techno economic feasibility study based on the gas demand, potential and geographical conditions, distribution of gas and allied facilities in the state. SIDCO would act only as a nodal agency for facilitating and coordinating the activities of GAIL India Limited during the course of implementation of the project.

Indian carmakers see sharp fall in May 2008 sales

It is reported that, with input costs shooting up and a fuel price hike in the horizon, Indian carmakers have a tough task on hand luring in customers. While April 2008 was a relatively good month for carmakers in terms of sales, they are seeing a sharp fall in numbers in May 2008.

The biggest dent is in the small car segment, which accounts for 75% of the total sales. Carmakers blame the recent car price hike, high interest rates and the rising input costs of steel, aluminum and plastics. They said that the imminent fuel price hike will only add to their woes.

Mr Dilip Chenoy director general at Society of Indian Automobiles said that "It is bad times as fuel prices affect both automakers and auto consumers."

Carmakers are reluctant to offer heavy discounts to accelerate sagging sales as input costs have already put a lot of pressure on margins. Instead, some of them are thinking of bringing in cars, which use alternative fuels like CNBC and LPG.

Mr HS Lheem president of Hyundai Motor India said that "There is pressure. We are getting into LPG and CNG to combat this"

Even luxury car makers are feeling the pinch. Automakers for now have chosen to wait and watch and postponed new launches for the coming months.

Essar Oil to expand capacity to 1 million barrels a day

Mr Naresh Nayyar MD of Essar Oil Limited said that it is planning to increase capacity to 1 million barrels a day and expects to tie up a USD 4.5 billion loan for the expansion in the next few weeks. He added that domestic refining capacity will be increased to 750,000 barrels a day by 2010 from 250,000 barrels and the rest will be added overseas in 3 to 4 years.

Essar Oil aims to narrow the gap with Reliance Industries Limited, which is using record profits to build the world’s biggest refinery complex. Essar’s Jamnagar refinery started last year, almost a decade after it was first planned, as the group’s steel unit faced losses because of falling prices of the commodity.

Reliance has built a plant in the same city that’s 3 times larger than Essar’s and will almost double capacity again with a new facility. Reliance Petroleum Limited, a unit of Reliance Industries, is building a 580,000 barrel a day refinery adjacent to the 660,000 barrel a day plant owned by its parent.

Mr Nayyar said that Essar will sell as much as 60% of fuel from its refineries in India after adding capacity. He added that "Indian fuel demand is rising and we hope the government will change its pricing policies."

Essar currently sells 65% of fuel to state run refiners including Indian Oil Corporation. It had to shut more than 90% of its 1,250 fuel stations because it could not match the prices charged by state run refiners. It plans to invest USD 290 million on exploration.

AP Coastal Corridor project approved

Exim News Service reported that Indian government has agreed to support the Coastal Corridor project covering the districts of Srikakulam, Vizianagaram, Visakhapatnam and East Godavari district of Andhra Pradesh.

The state government will now look to develop a 4 or 6 lane road parallel to the existing national highway to support the port based industries.

According to the initial plan, the Andhra Pradesh government is looking at developing the 30 kilometers long road from Visakhapatnam to Gangavaram Port. The total distance that has been identified is 138 kilometers, but the state government have been asked implement it in a phased manner.

The total cost of the project, is yet to be finalized, but is estimated to be around INR 5,500 crore and in the first phase, around INR 1,100 crore has to be invested.

BG Infralogistics may get Haldia dock terminals deals

Exim News Service reported that ABG Infralogistics has outbidded TM International Logistics in partnership with Ripley & Co, Sical Logistics and Orissa Stevedores for securing the operation, handling and maintenance contracts for two berths at the Haldia dock. However, Kolkata Port Trust is yet to formally approve the selection of the company.

Once approved and the contract awarded, the actual operation is expected to begin within another 6 months. This is because substantial investments, running into a couple of hundred crore of rupees, might be needed on the acquisition and deployment of equipment 6 mobile harbor cranes, 50 pay loaders and 30 dumpers.

The Number 2 berth of the Haldia dock is newly built, commissioned a few months ago, while the Number 8 is an old berth. At both the berths, ABG Infralogistics will handle mainly coking coal import for Steel Authority of India and TATA Steel. The plan also includes launching trans loading operation at Kanika Sands, an uninhabited island off Orissa coast.

SAIL, which imported 4.6 million tonnes of coking coal through Haldia in 2007-08, has indicated to step up the throughput to 6 million tonnes in the current fiscal. For SAIL, Haldia is the most suitable port from rail transportation point of view for 4 of its plants located at Durgapur, Bokaro, Rourkela and Burnpur.

Depending on the success of negotiation with SAIL, ABG Infralogistics will approach the Orissa government for necessary clearance. Kanika Sands being off the Orissa coast, the Orissa government has made it clear that no operation could be undertaken in the island without its prior approval.

PTC India to raise USD 500 million

PTC India has announced that it planned to raise USD 500 million to meet its growing requirements.

Mr Tantra Narayan Thakur CMD of PTC India said that "The requirements are huge. But we also have to look at the market appetite. Any fund worthwhile should not be less than USD 300 million. But initially, we would go for USD 500 million and later raise it further."

Mr Tantra added that it is in talk wit h investors to understand market requirements, while declining to give any time frame.

Videocon plans 1000 MW hydel power project in Uttarakhand

BS reported that Videocon Group is planning to set up a 1,000 MW hydroelectric power project in Uttarakhand with an investment of INR 6,000 crore.

It plans to rope in a US partner for the proposed project.

AFCONS receives LoI to develop Simar port in Jamnagar

Exim News Service reported that AFCONS, the marine infrastructure wing of the Mumbai-based infrastructure major Shapoorji Pallonji, has received the letter of intent from the Gujarat Maritime Board to develop the Simar Greenfield port in the state. This marks Shapoorji Pallonji's foray into port operations and bulk cargo handling.

AFCONS had made its name as a specialist in providing infrastructure for ports, having constructed more than 150 marine structures throughout India. It will reportedly be investing INR 800 crore to develop and handle cargo at Simar.

The first phase of the project is proposed to be completed by 2012 and the second phase by 2020 with handling capacity of 10 million tonnes. A detailed study of the project will be initiated soon, with work set to begin immediately after obtaining the remaining clearances, including those related to the environment.

Simar is planned as an all weather direct berthing port with a 300 meters long jetty and offshore breakwater of 700 meters.

TATA Steel inks strategic partnership with Vietnam Steel

VNS reported that TATA Steel has entered into strategic partnership with Vietnam Steel to develop the iron and steel industry.

Mr Indronil Sengupta CEO of TATA Steel Southeast Asia projects during an interview with VNS said that "After more than 100 years of making steel and mining, four years ago, as part of its globalization strategy, TATA Steel began focusing on Southeast Asia. Today we are the most significant player in the region, with around 4 million tonnes per annum and manufacturing units in Singapore, Viet Nam, Malaysia, Thailand and the Philippines."

He added that "We are setting Viet Nam as our first priority in our investment strategy and will be investing in a large steel plant and iron ore mine. Viet Nam is now one of the fastest growing markets in Southeast Asia, with GDP growth estimated at about 8%."

He said "We consider Viet Nam the most significant market for TATA at the moment, particularly in the production of steel. TATA Steel has just entered the Viet Nam steel market with an investment project for constructing and operating one of the largest steel complexes in Viet Nam, in partnership with Viet Nam Steel Corporation. This steel complex will be located in Ha Tinh Province with an estimated capacity of 4.5 million tonnes per annum."

Mr Sengupta further added that "As one of the few steel companies that also mine iron ore, TATA Steel will participate in Thach Khe Iron Ore Joint Stock Company, through which we expect to contribute our mining experience. These are just TATA Steel’s very first steps into Viet Nam’s emerging market."

BSRM introduces Xtreme 5OOW steel in Bangladesh

The New Nation reported that Bangladesh Steel Re Rolling Mills Ltd has launched Grade 500W rebars, helping make constructions stronger, safer, more durable and also more cost effective in Bangladesh.

Using premium European technology, BSRM has set up a 375,000 tonnes per annum state of the art steel rolling mill to cater Bangladesh's demand for high strength steel. These rods have a yield-strength of over 500 MPa, which is 20.8% stronger than Grade 60 steel.

Bangladesh Steel Re-Rolling Mills Ltd, a unit of well known H. AKBERALI Group of Industries, having 55 years experience exclusively in steel making, is fully automatic steel re rolling mill in the country. The founder of the group was late Mr Akberali A Africawala and is now managed by his son Mr Ali Hussain Akberali and other sons & nephews.

HPCL Q4 2008 net profit dips by 30% YoY

Hindustan Petroleum Corporation Limited has posted a profit of INR 384.5 crore in the January to March 2008 quarter down by 30% YoY as against INR 549.5 crore in January to March 2007 quarter.

Like its larger rival Indian Oil Corporation, HPCL also said that it would be forced to curtail product supplies to domestic market if a relief package to plug the company's ballooning oil subsidy bill was not finalized soon.

Mr Arun Balakrishnan CMD of HPCL said that "If there is no relief, we will have to restrict sales. Imports are finalized up to June 2008. For July, August and beyond, we will decide what to do next week."

HPCL saw a sharp increase in its interest costs during the year to INR 792 crore as against INR 423 crore in 2006-07 fiscal. It has also been forced to defer its major CAPEX plans such as expansion of Vizag refinery, which would have long term implications for the company.

HPCL announced a dividend of 30% involving a total payout of INR 118.86 crore including dividend tax.

Esmark board to decide on Severstal offer by June 13th 2008

Platts reported that Esmark's board of directors has set a June 13th 2008 deadline for consideration of Severstal's USD 17 per share offer to buy the US steelmaker.

Esmark in a statement said that that its board would decide on or before June 13th 2008 whether to recommend or reject the Severstal offer, remain neutral or express no opinion with respect to the offer.

In the meantime, Esmark urged its shareholders to take no action until the board makes its recommendation.

The Severstal offer expires on June 26th 2008 at 12:00 midnight EDT, leaving shareholders two weeks to make a decision after the board's response.

Venezuelan initiate tax probe against Ternium Sidor

Ternium SA announced that following the announcement of the Venezuelan government’s intention to nationalize Sidor and the passing of legislation to that effect, the Venezuelan tax authorities initiated a tax assessment against Sidor involving income taxes for fiscal years 2003, 2004, 2005, 2006 and 2007 resulting in allegedly omitted payments in an aggregate principal amount of VEB 1,438.6 million (USD 669.1 million).

The tax assessment, which covers certain previously audited periods, alleges that Sidor improperly deducted certain payments for income tax purposes, primarily consisting of amounts paid to Ylopa Serviços de Consultadoria Ltd a subsidiary of Ternium organized under the laws of Portugal, and Corporación Venezolana de Guayana under certain participation account agreements entered into with Ylopa and CVG in connection with the restructuring of Sidor’s financial debt in 2003. In addition, the tax assessment challenges, among other things, the adjustment of tax loss carry forwards corresponding to prior fiscal years.

The tax assessment requires Sidor to amend the relevant income tax returns and pay the balance plus a penalty equal to 10% of the allegedly omitted amounts.

Sidor may challenge the tax assessment and maintain the suspension of its effects. Sidor believes that it is and has always been in compliance with all applicable Venezuelan tax laws and regulations and that there are no grounds for any such claims.

Ternium will defend itself vigorously against any attempt by the Venezuelan government to lower the compensation for its interest in Sidor as a result of this tax assessment and reserves all of its rights under contracts, investment treaties and Venezuelan and international law in connection therewith.

PT Kerakatau prefers IPO as Q1 profit soars

The Jakarta Post reported that Indonesia’s PT Krakatau Steel has rejected suggestions that it would benefit from partnerships with larger international steel producers. PT Krakatau Steel cited its massive first quarter profit this year, which almost equaled its full year profit target, as evidence for its self sustainability.

According to company data, the company's net profit reached IDR 411 billion (USD 43.9 million) in the first quarter of 2008.

Mr Fazwar Bujang president of Kerkatau in a press conference said that "Steel plants all around the world are already overloaded in capacity. It would be very difficult for us to raise output with or without a strategic partner.”

Mr Fazwar said that "The decision to have either an initial public offering or a strategic partnership is completely in the government's hands. We can only give suggestions. But we believe an IPO is better because it will give the public a chance to own shares in Krakatau Steel adding that an IPO would also increase transparency and market capitalization.”

Mr Fazwar said that "Besides, the government has stated the most important thing to gain from a strategic sale is technological advancement, but none of the investors has proposed any new technological contribution.”

Mr Fazwar said that the company was revising up its 2008 target to IDR 850 billion, more than double last year's IDR 367 billion. Mr Fazwar added that "The healthy quarterly profit is due to the rising price of steel products in line with increasing demand and significant improvements in our operations.”

Krakatau Steel has recently attracted a host of bids from big players following the government's plan to privatize the company, a decision company employees and leaders have publicly criticized.

EU emission plans to hit competitiveness of German steel makers

Mr Thomas Schlenz chairman of the Works Council of the ThyssenKrupp Group and Dr Gunnar Still Group Environmental Protection Officer, during discussions with journalists in Düsseldorf recently said that “For the third trading period under the CO2 emissions trading system, ThyssenKrupp Steel needs allowances to be allocated largely free of charge. This is the only way we can remain competitive in the international markets, even if it means that the model iron and steel mills in Europe will face disadvantages as a result. We have to ensure a level global playing field for all market players.”

Mr Schlenz who warned that the industry could slowly abandon Europe as a production location said that “As a consequence of a costly EU solution for emissions trading, we expect investments in steel production to be stopped, jeopardizing our integrated iron and steel making site in Duisburg with more than 10,000 jobs.”

The European steel industry is jointly demanding full exemption from auctions on the basis of a benchmark, to be set in accordance with the lowest CO2 emissions to date on the respective production lines. In the allocation for the trading period from 2013 to 2020, producers must not fall short of this technically achieved benchmark. Steel production outside Europe is not being impacted by costs for CO2 certificates. An international agreement, under which countries such as China and India are not obligated to reduce emissions is also leading to a divergence in competitive conditions. Serious cost disadvantages are expected which ThyssenKrupp Steel cannot pass on to its customers or offset through rationalization measures.

But moving out of Europe would do nothing to improve the global CO2 balance. On the contrary: in the majority of cases, standards at overseas production facilities are significantly lower than those applied by European producers. CO2 emissions would therefore increase. Moreover, with production of 1.3 billion metric tons per year, steel is the number 1 material in the 21st century. Consumption will continue to increase in the coming years, particularly as there is still high catch-up demand in the BRIC states (Brazil, Russia, India and China). To compare: per capita steel consumption in Germany is 436 kg per year; in China the figure is 251 kilogram and in India only 35 kilogram.

Emissions’ trading is hitting power-intensive steel production doubly hard, as electricity prices are rising all the time. For ThyssenKrupp, the EU’s plans will have a further substantial negative impact because they will also affect the energy network in Duisburg, Europe’s biggest steel production site. Process waste gases created during the production of coke, pig iron and crude steel are reused in a similar way to the use of waste heat in combined heat and power plants.

Dr. Still said that “Yet Brussels is demanding that we purchase certificates for this eco friendly process, which in this case even enables electricity to be generated. Where is the justice in putting this exemplary use of residual energy to generate electricity which we have been practicing for over 60 years on a level with electricity production methods involving the combustion of coal, oil or gas. Additional electricity also needs to be purchased from the grid for the production and processing of steel.”

Dr Still added that “ThyssenKrupp is facing up to the challenges of climate change. When it comes to climate protection, we are active on two fronts. On the one hand we undertake every possible effort to reduce the pollution associated with the production of our material. On the other hand we are developing steel further so that it can play an ever greater role in active climate protection. By way of an example he referred to the subject of weight reduction in auto construction: lighter steel bodies save more CO2 over their useful lives than is created during the production of all the steel used in a car. And he also quoted an example of advances in technology since 1990 ThyssenKrupp Steel has reduced its CO2 emissions by 15%, since 1960 by as much as 40%. The limits of what is technically achievable in the blast furnace process have been reached. Together with the EU, the European steel industry is now concentrating on the ULCOS research project, which aims to develop completely new processes for the production of pig iron. Initial trials have been encouraging, but it will take decades until industrial-scale use is feasible.”

Tin prices plunge in Kuala Lumpur

Platts reported that the Malaysian domestic tin price on the Kuala Lumpur Tin Market continued on the downward trend from the previous day after a brief rebound above USD 24,000 per tonne on Wednesday. The Kuala Lumpur Tin Market price was settled at USD 21,470 per tonne down USD 2,480 per tonne from USD 23,950 per tonne. Malaysian domestic tin price averaged lower this week on the KLTM, having slipped further below USD 24,000 per tonne.

The KLTM source noted that the Malaysian domestic price held steady at USD 23,800 per tonne on the first two days of the week, before having jumped to USD 24,250 per tonne on Wednesday. Its position above USD 24,000 per tonne however was short lived as the KLTM price slipped to USD 23,950 per tonne on Thursday on weaker tin prices at below USD 24,000 per tonne on the LME.

Despite the only seller's keen interest to sell, the KLTM source said that buyers were not keen. He said that "They were exerting pressure on the price with bid volume of 44 tonne so much lower than the seller's offer of 309 tonne.”

A Kuala Lumpur Tin Market source attributed the huge loss to a sharp fall in tin prices to below USD 23,000 per tonne on the London Metal Exchange on Thursday.

Barclays Capital said in a report that Thursday that LME prices were struggling to find decisive direction and were drifting lower. The Bank said that "Demand concerns have made the market more watchful of stock movements and prices are reacting heavily to inventory builds.”

Deutsche ups EU carbon price forecast to EUR 40

Reuters reported that Deutsche has raised its European Union 2008 carbon price forecast to EUR 40 from EUR 35 previously and well above the current price of about EUR 26.

Deutsche has raised its price forecast for emissions permits called EU allowances because of higher than expected carbon emissions in 2007, plus rising oil prices and the inclusion of aviation carbon emissions in the scheme in 2011 or 2012.

Mr Mark Lewis analyst at Deutsche carbon said that "This is going to be tougher than we thought.”

Mr Lewis estimated that assuming interest rates of 4.5% fundamentals pointed to a long run carbon price rising from EUR 40 in 2008 to EUR 67 in 2020.
The EU's cap and trade scheme forces energy intensive companies to buy permits to emit the planet warming gas carbon dioxide. The scheme covers nearly half the EU's carbon emissions and is its main weapon against climate change. Power generators which burn fossil fuels add the extra cost to power prices, which means a carbon price hike impacts electricity bills for everyone inside the 27 nation bloc.

Japan to hike export prices for CRNGO

It is reported that Japan will start price talks with Asian buyers on non grain oriented silicon steel sheet in the third quarter.

The price is expected to reach USD 1,200 per tonne which is USD 250 to USD 300 per tonne higher.

The result is expected to come out soon, as buyers will be forced to accept higher prices in order to secure stable supply.

(Sourced from YIEH.com)

Sturgis Iron & Metal sold to SDI

It is reported that Sturgis Iron & Metal, which had entered bankruptcy protection recently has reportedly been sold to Steel Dynamics Inc.

According to a source the deal was approved on May 27th, but it did not include the controversial mega shredder that the company operated at its Elkhart in Indiana facility.

Local press reports noted that the best bid for Sturgis Iron’s facilities, located primarily in Michigan and Indiana came in at USD 38 million, although the bid did not include the mega shredder. Another report notes that the mega shredder is a leased machine and can’t be sold with the rest of Sturgis Iron & Metal.

According to the Sturgis Web site the company operates three scrap metal facilities in Michigan, and five facilities in Indiana. The company also has a location in Georgia.

Lion Industries Q3 earnings surge by 388% YoY

The Star online reported that Malasia’s Lion Industries Corp Bhd's net profit for the third quarter ended March 31st 2008 soared by 388% YoY to MYR 200.81 million as compared Q3 of 2007. Its revenue rose by 35.29% YoY to MYR 1.69 billion.

During the Q3 quarter, it booked a MYR 56 million gain from disposal of shares in associated companies. It said that lower finance costs had further increased pre tax profit by 72% YoY to MYR 406.6 million against MYR 236.7 million in the previous corresponding period.

In the third quarter, steel contributed MYR 1.59 billion to revenue, tyres accounted for MYR 18.18 million while other divisions contributed MYR 83.25 million.

Lion Industries in a statement said that the improvement was due to higher selling price of steel, better profit margins and a gain on disposal of shares in associated companies.

The statement added that “The group is expected to perform better in the next quarter, with significant improvement in the steel division in view of the favorable local market conditions and strong global demand.”

Hyundai Steel raises section steel prices

South Korean Hyundai Steel is adding its section steel price by KRW 80,000 per tonne effective from June 2nd 2008.

The new ex work price of H beam in small size will be up to KRW 1.14 million per tonne. Price of angle bar in small size will be KRW 1.12 million per tonne. Domestic demand of H beam of this year is expected to be up to 3.26 million tonnes.

Current price of H beam for June shipping is at USD 1,250 per tonne and it is expected to reach USD 1,300 per tonne for July.

(Sourced from YIEH.com)

FERC approves REX East pipeline project in US

Reuters reported that the Federal Energy Regulatory Commission has approved the REX East pipeline, the third leg of a huge pipeline project to bring natural gas drilled in the Rocky Mountain region to markets in the Midwest and Eastern United States.

As per report the Rockies Express East pipeline would transport more than 1.8 billion cubic feet of gas a day. The 639 mile pipeline would connect with the eastern end of the REX West pipeline in Missouri, stretch through Illinois and Indiana and terminate at a connection with three other pipelines in Ohio.

Mr Joseph Kelliher chairman of Federal Energy Regulatory Commission said that "This project, one of the largest pipelines to be constructed in the United States is needed to meet ever rising demand for natural gas to generate electricity and serve consumers in the Midwest and in the eastern regions of our country.”

Federal Energy Regulatory Commission approved the first leg of the Rockies Express project in August 2005 with 327 miles of new pipeline that would carry 1.1 billion cubic feet of gas a day from Colorado and Wyoming to the Cheyenne Hub at Weld County in Colorado.

The second leg was of the pipeline was the REX West project, which was approved in 2007 and consists of 717 miles of pipeline connecting the Cheyenne hub to the delivery point at Audrain County in Missouri. REX West can move up to 1.5 billion cubic feet of gas a day.

The pipeline's owners are Kinder Morgan Energy Partners, Sempra Energy and ConocoPhillips. REX East is expected to be in service in the summer of 2009.

Minnesota Steel officials meet with Iron Range Resources

Wdio.com reported that Minnesota Steel, owned by Essar Global, met with members of Iron Range Resources and they told area leaders that groundbreaking is set for this summer.

Mr Ravi Ruia vice chairman of the Essar Group said that they are committed to moving as quickly as possible and that they plan on casting the first steel slabs within five years and various development agreements are still in the works.

Minnesota Steel is the massive mining through steelmaking project planned for Nashwauk. Estimated capital investment comes in around USD 1.65 billion dollars.

Taiwanese plate and sheet imports in April up by 18%

It is reported that Taiwan imported 84,000 tonnes of plates and sheets in April 2008 up by 18% YoY. Taiwan steel sheet import to different countries

Volume in tonnes
Price in TWD per tonne

EC clears Scholz buy of 50% stake in Eko recycling

Thomson Financial reported that the European Commission has cleared steel group Scholz AG's recycling unit's proposed acquisition of a 50% stake in Eko Schrottrecycling GmbH.

The report said that the transaction was reviewed under the EU's 'simplified' merger review procedure for cases which the commission believes do not pose competition concerns.

RWE to sell German gas transport network

Reuters reported that German utility RWE would sell its gas transportation network in Germany within two years. The decision made by RWE's supervisory board came in response to antitrust proceedings initiated by the European Commission against the group's gas transmission operator, RWE Transportnetz Gas in April last year.

RWE in a statement said that "RWE will now commit to selling off its gas transportation network in Germany to an independent third party within the next two years.”

It said the board's decision was not an admission of guilt regarding the European Commission's suspicion of unjustified obstacles to access to gas transportation in Germany.

RWE said that "In order to avoid protracted litigation, however, the group has now decided in favor of a consensual settlement and would like to end the proceedings in cooperation with the European Commission.”

Vietnam starts construction of the Cai Mep container Port

It is reported that Vietnam's newest container port, the Cai Mep International Terminal held a ground breaking ceremony on board a vessel overlooking the construction site on the Cai Mep River in Ba Ria Vung Tau Province’s Tan Thanh District.

The new terminal will open in late 2010 and will have a handling capacity of some 1.1 million TEUs.

The new port, with 600 meter of quay length and equipped with six high tech cranes will offer customers state of the art IT and container handling equipment.

STX wins USD 126 million order for two bulk carriers

Yonhap reported that South Korea's STX Shipbuilding Co has won a KRW 129 billion (USD 126 million) order to build two bulk carriers.

STX Shipbuilding in a regulatory filing said that the deal with a European shipping company calls on STX Shipbuilding to deliver the vessels by May 31st 2009.

Turkish competition board investigating steel firms

Reuters reported that Turkey's regulatory competition board has opened an investigation into Turkish firms Erdemir and Borcelik and two local units of ArcelorMittal.

The board had opened a probe into steel companies to examine whether they had artificially raised prices, which have doubled within the last year.

Erdemir is Turkey's largest flat steel producer, followed by Borcelik. It has annual flat steel production capacity of 1 million tonnes. The two ArcelorMittal companies are ArcelorMittal FCE Celik Ticaret and a packaging firm.

Iran to reach 5 million tonnes steel output this year

IRNA quoted Mr Ahmad Ali Haratinik Iranian deputy minister of industries & mines as saying that if the projected plans in the steel sector go on stream, Iran’s capacity of steel production will increase to 5 million tons by the end of the current Iranian year.

Mr Haratinik added that despite all deficiencies in the past year, steel projects in the complex are well underway. He said that by launching steel projects in Hormozgan, Khuzestan and Isfahan steel complexes, Iran’s steel production output is to be added up by 5 million tonnes.

GOIC prepares study on steel sector in Gulf

The Peninsula reported that Gulf Organization for Industrial Consulting is preparing a study on the feasibility of the stainless steel sector in the region.

GOIC study said that from 2002-2006, the world saw a compound annual growth rate of 6% in stainless steel demand while for the GCC region, the figure was well over 8%. It added that "Stainless steel is finding increasing product applications. The level of economic growth in the GCC region will continue to be robust based on sustained high surpluses generated by oil revenues."

GOIC said that the economic growth would continue to fuel the construction boom as money is being pumped into infrastructure, real estate and tourism projects as well as growth in the industrial sector as Qatar seeks to diversify its economy away from oil and natural gas.

The study said that "These factors will drive growth in consumption of stainless steel even higher in the years to come. There is no plant in the GCC manufacturing stainless steel using the integrated process route. This means the entire feed material requirement of the existing downstream industry is imported."

The study further added that "Given the drivers for consumption of stainless steel in the GCC region are very positive and that the market is likely to grow, it is appropriate at this time to take stock of the situation and prepare a blueprint for the development of the stainless steel industry in the GCC."

Flat steel sector related to growth rate of Turkey

Mr Mustafa Açıkalın chairman of Flatiron Imports, Exports & Producers Association said that the growth rate of Turkey's flat steel sector is directly related to the growth of the country's economy.

Mr Açıkalın said that "Our sector's growth rate has always equaled the country's growth rate. However, with the emergence of new investment projects in the flatiron product demands, we are expecting our growth rate to surpass that of the country. The sector witnessed a 4.90% increase in imports. We have mostly been importing from Russia, Ukraine and Romania."

He added that "We are expecting investments to increase drastically both in automotive and white goods. Although we are experiencing a slowdown in investments, we foresee the clouds will disappear as soon as the current political uncertainties are resolved."

Mr Açıkalın said that, with the new flat steel production projects, we are expecting a drastic increase in exports. He added that "Within the next 3 to 4 years our country will become one of the flat steel exporter countries."

Mr Oğuz Özgen chairman of Ereğli Demir Çelik said that there is steep competition in steel sector. He added that "Prices constantly increase."

(Sourced from Turkish Daily News)

UAE well prepared to raise oil production

Bloomberg reported that United Arab Emirates is prepared to raise production if required by the market.

Mr Ali Al Yabhouni UAE's governor to OPEC said that "UAE is willing and well prepared, if the market requires us to meet our responsibilities. We have to see if there is a demand and definitely, we can meet that demand."

Pressure has increased on OPEC, which pumps more than 40% of the world's oil, to increase output as record crude prices threaten economic growth.

UAE pumped 2.59 million barrels a day of crude in April 2008, making it OPEC's biggest producer after Saudi Arabia and Iran. It has 150,000 to 200,000 barrels a day of spare capacity, as does Kuwait.

Kentz Corp wins USD 208 million supply contract in Qatar

Doha Times reported that Irish engineering company Kentz Corporation has won a USD 208 million contract to supply electrical systems for a teaching hospital in Qatar.

As per report, Kentz Corporation will partner with TATA Group unit Voltas to complete work worth more than USD 400 million for the Sidra Medical & Research Centre in Doha.

Kentz reached an agreement on the Doha project with the main contractor, a JV between Spain’s Obrascon Huarte Latin SA and US based Contrack International.

Saipem wins Egyptian offshore contract

MEED reported that Burullus Gas Company has awarded Italian oil field services company Saipem a contract for the development of Egypt's Sequoia field, located offshore from the Nile River Delta. The work will be completed in the second half of 2009.

The contract follows the award by Burullus of a USD 400 million offshore expansion package to Saipem in August 2006 and a contract to provide offshore drilling services on its West Delta Deep Marine concession in the Mediterranean in December 2006.

Saipem said that the contract covers the engineering, procurement, installation and commissioning of the subsea development system for the Sequoia field in water depths of 70 meters to 570 meters, along with a new 22 inch gas export pipeline.

Burullus is a JV of the UK's BG Group, Egyptian Natural Gas Company and Malaysia's Petronas.

Emaar MGF to invest USD 3 billion in India

Real estate firm Emaar MGF Land, Indian JV of Dubai's Emaar Properties, said that it plans to spend USD 3 billion in developing properties in south India over the next few years.

Besides a residential property in Hyderabad with an outlay of USD 1.4 billion, Emaar MGF will invest in commercial and retail properties and hotels spread over 31 million square feet in 10 south Indian locations.

Emaar MGF in February 2008 called off a USD 1.6 billion initial public offering because of tepid investor interest.

Masdar to invest up to USD 2 billions in photovoltaic solar energy

Abu Dhabi based Masdar has announced that Masdar PV will embark on a multi billion dollar investment in thin film photovoltaic solar technology, as part of its drive to become a world leader in alternative energy.

The total investment of approximately USD 2 billion represents one of the largest investments ever made in solar and will fund a 3 phased manufacturing and expansion strategy to produce the latest generation of thin film photovoltaic modules.

Out of the total planned investment, phase one of the project involves an investment of USD 600 million, which will fund the development of two manufacturing facilities. The first, in Erfurt in Germany will be operational by Q3 2009 and a second facility in Abu Dhabi which will begin initial production by Q2 2010. The combined annual production capacity of these two sites will be 210 MW, which is committed to major PV system installers in Europe and for Masdar’s own energy generation needs.

Masdar chose Germany as the site for its first plant because Germany is currently the center of the global PV industry. This German plant will act as a reference plant for technology and knowledge transfer to the larger Abu Dhabi plant by a joint German Abu Dhabi team.

Dr Sultan Al Jaber CEO of Masdar said that "Thin film PV is a key part of our build deploy develop strategy to actively build a strong position in alternative energy. The investment in photovoltaic solar energy will compliment Abu Dhabi’s existing energy market. Abu Dhabi is a global energy leader, so it makes sense to engage these new energy technologies to maintain leadership and become a global energy hub."

Dubai Q1 2008 non oil foreign trade surges by 46% YoY

Khaleej Times reported that Dubai’s non oil foreign trade volume has jumped up by 46% YoY in the January to March 2008 quarter, reaching AED 214 billion as against AED 146.5 billion in January to March 20007 quarter. During the quarter, Dubai’s exports recorded a phenomenal growth soaring by 79% YoY, while re exports went up by 73.5% YoY and imports grew by 49.7% YoY.

The latest statistics, compiled and released by Dubai World’s Statistics Department show that Dubai's direct non oil foreign trade, excluding free zones and customs warehouses, amounted to AED 143.8 billion during the January to March 2008 quarter as against AED 91.53 billion for the January to March 2007 quarter, showing an increase of AED 52.3 billion.

Mr Sultan Ahmed Bin Sulayem chairman of Dubai World said that "The figures released by Dubai World Statistics Department underscore the buoyant commercial growth of the emirate, reinforcing Dubai’s reputation as a major commercial hub. The growth is fuelled by the government’s relentless efforts to upgrade the existing modern infrastructure of ports, airports and land transportation network, connecting Dubai to the world."

He added that "The growth of Dubai’s non oil economy also comes as a result of the noticeable rise in the international oil prices, which led to a corresponding increase in government income and the public spending on developmental projects. The unprecedented construction boom and the tourist and commercial development are also factors which largely contributed to this growth."

India topped the list of Dubai’s direct import destination in the first quarter of 2008 with a share of 13.14% of total imports worth AED 12.6 billion. China came second with AED 10.7 billion, followed by Switzerland with AED 7.2 billion. India, China and Switzerland together accounted for 31.8% or AED 30.5 billion of Dubai’s total imports, while imports from other countries accounted for 68.2% or AED 65.6 billion.

EMICOOL signs AED 669 million Syndicated Islamic Finance Facility

Al Bawaba reported that Emirates District Cooling Company Llc, a JV between Union Properties PJSC and M’Sharie, has signed a Syndicated Islamic Finance Facility of AED 669 million with seven leading banks to fund the first phase of its AED 2.5 billion expansion plan.

The Syndicated Islamic Finance Facility is arranged jointly by Badr Al Islami, Standard Chartered Bank and Emirates Islamic Bank as Initial Joint Mandated Lead Arrangers. The Commercial Bank of Dubai, Dubai Islamic Bank, Emirates Bank International and Union National Bank acted as Joint Mandated Lead Arrangers in the syndicate.

The signing ceremony of this Syndicated Islamic Finance Facility agreement was attended by Mr Anis Al Jallaf chairman of Dubai Investments & Union Properties, Mr Khalid Kalban MD & CEO of Dubai Investments, Mr Abdul Aziz Yaqoob Al Serkal MD of M’Sharie and also chairman of EMICOOL and Mr Simon Azzam CEO of Union Properties.

Mr Al Serkal said that "This syndication opens up new strategic avenues for EMICOOL and will help to set the company on a sustainable high growth trajectory. We view the enthusiastic response from the banking community as further proof of EMICOOL’s distinguished market reputation and excellent growth potential. We are also pleased that we were able to secure the financing at a rate that, under prevailing market conditions, can be considered extremely competitive."

Mr Abdul Aziz Serkal said that "EMICOOL has drawn up ambitious plans for the future, and continued expansion of production capacity forms the centerpiece of our business strategy. As the demand for District Cooling is continuously on the rise across the UAE and Middle East region, it has become imperative for EMICOOL to optimize production capacity and further enhance its technological capabilities to meet growing market requirements more efficiently."

He further added that "The financing proceeds will mainly be used to fund EMICOOL’s projects at Dubai Motor City and Dubai Investments Park. EMICOOL estimates that its ambitious expansion plans will require an investment of AED 2.5 billion over the next 5 years. In this regard, EMICOOL expects to raise twice the amount of the current syndication in the future to refinance the existing facility and meet future requirements."

GE Energy signs USD 500 million deal with Saudi Electricity Co

GE Energy recently announced that it has signed contracts worth more than USD 500 million to supply gas turbines and generators for power plant projects owned by Saudi Electricity Company.

In the first agreement, GE Energy has received a contract to supply gas turbine generators for the 960 MW expansion of the Rabigh Power Plant in Rabigh City, on the west coast of Saudi Arabia. The project is part of SEC's initiative to provide additional power to support the region's economic and population growth.

In addition to the Frame 7EA gas turbines at the Rabigh site, GE's scope of supply includes Type 7A6 generators, technical advisory services during installation and spare parts. The EPC contractor for the project is the National Contracting Company Limited of Al Khobar.

Further expanding its presence in the Middle East's rapidly growing power industry, GE Energy also has received a contract for gas turbines that will be used by four power plants owned by SEC.

Mr Joseph Anis GE Energy's region executive for the Middle East said that "These projects are part of SEC's on going efforts to meet the region's soaring power demand. Our capability to provide gas turbine technology with a short delivery cycle, plus the proven reliability of our gas turbine technology, was key factors in winning these contracts."

GE maintains a workforce of more than 600 employees in the oil rich Gulf Kingdom with offices in Jeddah, Riyadh and the Eastern Province, as well as joint ventures in the fields of energy, healthcare and appliances. GE's current business portfolio in Saudi Arabia includes power and water, transportation and healthcare, in addition to new opportunities in financial services and advanced materials.

External debt at peak level of USD 44.59 billion in Pakistan

Business Recorder reported that Pakistan’s external debt witnessed a rise of over USD 5.5 billion to hit a new peak of some USD 44.59 billion during the current fiscal year mainly due to rising current account deficit.

As per Fiscal Responsibility & Debt Limitation Act, 2005, the government has to reduce its foreign debt by 2.5% every year and current year it should be 24.5% of GDP from 27%. However, during the current fiscal year it is difficult for the government to meet this target due to rising current account deficit and it is expected that by the end of June 2008 it would remain at 27% of GDP.

Economists said that the government has borrowed some USD 5.58 billion foreign debts during the first three quarters of the current fiscal year to meet its over USD 10 billion current account deficit. They said slow foreign inflows coupled with declining foreign investment and sluggish privatization process compelled the government to use the tool of borrowing to fulfill its foreign payment requirements.

After the current upsurge, first time in the history of the country, overall foreign debt that earlier stood at USD 39.008 billion on June 30th 2007, rose to historic level of USD 44.596 billion by the end of March 2008. External debt and liabilities showed an increase of 13.45% to USD 45.926 billion till March 2008. It previously stood at USD 40.481 billion on June 30th 2007.

Economist said that during the first three quarters of FY08, the country faced USD 9.85 billion current account deficit because of high goods and services trade deficit as compared to some USD 6.16 billion deficit during the same period of last fiscal year, which forced the government to use foreign exchange reserves and borrow from international financial institutions.

During the current fiscal year, the government utilized some USD 3 billion from foreign exchange reserves and some USD 3 billion of foreign investment to meet current account deficit, while remaining gap was bridged through new foreign loans.

Iranian car production in two months dips by 27% YoY

Mehr News Agency reported that Iranian carmakers produced over 156,000 cars in the March 20th 2008 to April 20th 2008 period down by 27% YoY.

This is while the deputy minister of industries and mines for industrial affairs, Mr Danesh Marnani has been surprisingly quoted as saying that "Statistics indicate increase in production."

IPCC targets USD 1 billion petrochemical export to china

Mehr News Agency quoted Mr Mohammad Ali Zardbani MD of Iran Petrochemical Commercial Company as saying that it plans to export USD 1 billon worth of petrochemical products to China this Iranian calendar year.

Mr Ali Zardbani said that "China alone accounts for importing 10.5% of Iran’s petrochemical export bound products." He added that in last Iranian year ended March 19th 2008, IPCC exported USD 590 million worth of petrochemical products to china.

Mr Zardbani also added that the company’s total exports amounted to USD 5.5 billion in last Iranian year, of which 30% was sent to the Far East, 32% to the Middle East, 13% to Europe, 10.5% to China, 5% to India and the remaining 9.5% to other Asian and African countries.

He also noted that the amount of petrochemical products imported to Iran in the previous Iranian year was not significant. He added that "We imported less than USD 100 million worth of petrochemical products. Caustic soda was the import staple which is widely used in many industries."

IPCC has already announced that it exported over 1.5 million tonnes of petrochemical products valued at approximately USD 1.26 billion since the beginning of the current Iranian year.

Iranian petrochemical products export hits USD 1.26 billion

According to a report issued by the Iran Petrochemical Commercial Company, the total value of the exported petrochemical products since outset of the current Iranian year amounted to USD 1.26 billion.

Iran’s total petrochemical product’s export volume during this period reached 1,554,000 tonnes. 24 various kinds of petrochemical products have been exported of which during this period, methanol stood at the first place with a total of 300,000 tonnes export volume.

IPCC’s total sales value in the previous Iranian calendar year was about USD 8.3 billion of which about USD 5.5 million was earned from exportation and the rest from domestic sales.

Methanol, ethylene, propylene, butadiene, LAB and PTA are the major exported petrochemicals.

UAE cement makers surge on construction boom

Bloomberg reported that UAE shares advanced, led by cement companies on speculation increasing demand for properties will boost their profits.

Ras Al Khaimah Company for White Cement & Construction Materials rose to its highest in more than two years. Umm Al Quwain Cement Industries Company and Gulf Cement Company also gained. Union Properties advanced for a third day.

The Abu Dhabi Securities Exchange General Index added 0.8% to 5,037.85, while the Dubai Financial Market General Index rose by 0.2%, gaining for a third day.

Mr Mohamed Salem a trader at Al Futtaim HC Securities said that "Cement companies are extremely attractive because of soaring demand for properties and the shortage of cement makers.'

According to data compiled by Bloomberg, ADX Construction Index, a measure of 10 construction companies, trades at an average of 12 times trailing earnings. That compares with a multiple of 15 for ADX General Index.

MEA steel industry set for dramatic growth – MEED Report

MEED has launched an in depth report on Middle East Steel 2008 which forecasts dramatic growth for the industry in the region.

The report investigates the activities and plans of the region’s leading raw steel producers and their place in the global market, as well as looking at price and demand trends.

MEED’s Middle East Steel 2008 report reveals that, despite only accounting for 2% of the global steel trade, the Middle East steel industry is undergoing rapid expansion to meet the needs of the fast expanding construction sector. The Middle East produced 21.1 million tonnes of raw steel in 2006 and consumed 41.6 million tonnes of finished goods. This is forecast to rise to 35 million tonnes of production and 60 million tonnes of finished goods by 2010.

Mr Peter Shaw Smith senior writer of research & information at MEED said that "High oil incomes, coupled with major changes to real estate and mortgage laws, have fuelled a construction boom, with developers scrambling to bring on fresh supply. This is causing a backlog in the projects market, where strains are being placed on contractor capacity and building materials supplies. Unsurprisingly against this backdrop, steel prices have been volatile."

The report said that "According to MEED Projects, projects worth USD 2 trillion are planned or under way in the Gulf, with less than one quarter already awarded. The regional steel trade stands to make about USD 50 billion from projects currently under way and an additional USD 150 billion in the coming years from new schemes in the pipeline."

Rebar prices went through the USD 1000 a tonne barrier in late March 2008. They shot up from USD 600 a tonne to well above USD 800 a tonne in the three months to end January 2008, reflecting the huge demand for long products from the booming construction industry.
The report further added that, with Iran troubled by tension with the West, Saudi Arabia is the only country in the region in a position to substantially ramp up production to meet the strong regional demand. Egypt is the region’s other major player, but exports little to the GCC.

Chinese HRC export offers increase a bit this week

It is reported that Chinese steel makers have shot up export quotation for Chinese hot rolled steel coil again following the step of the increase in both domestic and international market.

On Shanghai market, commodity grade 4.75mm to 11.5mm thick HRC in 1500mm width was being quoted at CNY 5800 per tonne up by CNY 40 per tonne to CNY 600 per tonne from early this week. While that for 1800mm wide material remained at CNY 6150 per tonne. Low alloyed 7.5mm thick HRC was at CNY 6050 per tonne an increase of CNY 100 per tonne.

Export offers for commercial grade 4.75mm and up HRC were prevailing at USD 960 per tonne to USD 980 per tonne.

In general export offer for Chinese HRC is on the way to USD 1000 per tonne FOB. As a matter of fact, Q3 price offer by Japanese steel makers have already exceeded USD 1000 per tonne FOB with Nippon Steel at USD 1050 per tonne and JFE at USD 1040 per tonne to USD 1060 per tonne FOB for shipments to South Korea which compares with USD 980 per tonne by Shagang and USD 970 per tonne FOB by Anshan steel.

(Sourced from MySteel.net)

Chinese import and export of steel products in 4 months

It is reported that China import and export of steel products during January to April 2008 is as under

Exports

Volume in 10,000 tonnes

Imports