Semis prices escalate by 5% last week in Mumbai

Amid tight supply position, prices of feedstock for rolling mills witnessed a big jump of almost 5% during the last week.

Prices are in INR per tonne inclusive of ED and VAT
Delivery is FOT

(Sourced from www.steelprices-india.com)

POSCO war zone – Tension prevails as 1 anti activist killed

It is reported that a warlike situation prevailed on Saturday in Orissa’s Jagatsinghpur district, where POSCO proposes to put up a steel plant, following the death of an anti project activist earlier in the day.

Trouble began on Friday evening, when activists of the POSCO Pratirodh Sangram Samiti were attacked by villagers supporting the proposed mega project near Gobindpur. Three people were injured when bombs were hurled at the activists. One of them died in the SCB Medical College and Hospital in Cuttack.

After this incident, the anti POSCO activists’ gheraoed the attackers who had positioned themselves atop a school building and the gherao continued till Saturday evening. The attackers, numbering 59, were released after top officials of the district administration held negotiations with the Mr Abhay Sahoo president PPSS and his team. At least 26 pro POSCO activists have been arrested.

POSCO Pratirodha Sangram Samiti has decided to observe a ‘black week’ from Sunday.

It was on June 22nd 2005 that the Orissa government and POSCO had signed a MoU to build the USD 12 billion steel plant near Paradip port in Jagatsinghpur by 2016.

Long products may see price rally this week

The prices of long products although went up by INR 476 per tonne to INR 714 per tonne during last week in Mumbai market, are likely to see rally this week, as the prices of semis surged by much higher amount.

Prices are in INR per tonne inclusive of ED and VAT
Delivery is FOT

(Sourced from www.steelprices-india.com)

Essar Shipping to invest INR 10,000 crore in next 3 years

BS reported that Essar Shipping Ports & Logistics Limited will invest INR 10,000 crore for the development of shipping, ports and oil field services over the next 3 years. The investments come with the company's expectations of the annual revenues touching INR 6,000 crore, a 172%t rise from the present INR 2,200 crore.

Mr Sanjay Mehta MD of Essar Shipping said that its net profit is expected to increase to INR 1,000 crore from the INR 150 crore recorded in financial year 2007-08. He added that of the total INR 10,000 crore, it will use INR 4,000 crore to acquire 13 vessels and around INR 1,760 crore to purchase two rigs.

ESPLL will raise 30% of the total amount through internal accruals and the remaining will be raised from a consortium of banks, including ICICI, SBI, Hague based NIBC Bank and the UK based Halifax. It will pay an interest of around 6.5% in dollar denominations for the debt raised from foreign banks, while the loans from India will have an interest of 10.5% to 11%. The period of the loan is 7 to 14 years.

At present, ESPLL gets 35% of its revenues from promoter company Essar Steel, while about 5% comes from Essar Power. Another group company, Essar Oil contributes substantially to the company's revenues. The company transports iron ore for Essar Steel, coal for Essar Power and crude oil for Essar Oil and Vadinar Refinery.

NTPC forms 49:51 JV with Bharat Forge

With reference to the earlier announcement dated on February 8th 2008, National Thermal Power Corporation Limited has now informed BSE that a 49:51 JV company has been formed on June 19th 2008 between NTPC and Bharat Forge Limited under the name "BF-NTPC Energy Systems Limited" to establish a facility to take up manufacturing of castings, forgings, fittings and high pressure piping required for power projects and other industries, Balande of Plant equipment for the power sector.

Six entities short listed for Karwar Port project – Report

It is reported that around 6 entities have been short listed by the Karnataka government for developing the Karwar port project phase II in Uttara Kannada district.

The selected bidders will operate the port for a 30 year period and after completion of the period, it will be handed over to the government. The proposed port will have 2 additional berths, a petrol, oil & lubricant jetty along with related infrastructure. It will be developed at an estimated cost of INR 500 crore on public private partnership basis.

BHEL bags INR 1,840 crore deal from DVC

BS reported that Bharat Heavy Electricals Limited has bagged an order worth INR 1,840 crore from Damodar Valley Corporation for setting up a 500 MW Bokaro A thermal power project in Jharkhand on turnkey basis.

BHEL's scope of work includes design, engineering, manufacture, supply, erection and commissioning of steam turbines, generators, boilers, associated auxiliaries, balance of plant & electricals, besides state of the art controls & instrumentation, electrostatic precipitators ESPs and civil works.

Godawari Power unveils INR 280 crore CAPEX plan

Godawari Power & Ispat is planning to invest INR 280 crore over the next 2 years to expand capacity and acquire a majority stake in an iron ore pelletization plant. It would invest INR 235 crore in an iron ore pelletization, beneficiation and crushing plant.

Further it would contribute another INR 45 crore over 18 months to pick up 75% equity in Ardent Steel, which is setting up an INR 180 crore Greenfield 0.6 million tonnes per annum iron ore pelletization plant in Orissa. Ardent Steel is expected to begin production by the third quarter of 2008-09 fiscal.

Recently, Godawari Power has formed a separate subsidiary company in the name of Godawari Power Limited with an objective to set up a merchant power plant. Godawari Power holds 26% stake in a consortium which has been awarded three coal blocks.

It has also been allocated 2 iron ore mines. These coal blocks are under various stages of development and benefits from these are expected to start from 2009-10 fiscal onwards. It reported 81.94% YoY jump in its net profit to INR 949.9 million for the financial year 2008 as compared to INR 522.1 million posted during 2006-07 fiscal.

Bombardier wins USD 6 million supply order from Indian Railway

BS reported that Bombardier Transportation has won a USD 6 million order to supply an advanced traffic management system for the Indian Railways. The contract will improve safety in the Mumbai CST-Kalyan suburban section of the Central Railway as traffic controllers will be able to monitor the train traffic on a real time basis.

Mr Rajeev Jyoti MD of Bombardier Transportation India said that "With this latest order, Bombardier demonstrates its commitment to providing leading edge technology and support in India."

With the new system, around 3 million passengers using the Central Railway line daily will receive a continuously updated, minute by minute countdown showing the exact train time arrival at the platform.

In addition, there will be automatic multi lingual passenger announcements on the train, bilingual displays at station entrances, and information relating to the next two incoming trains at each platform.

The contract, with a value of around EUR 4 million, is for the design, supply, installation, testing and commissioning of a traffic management system for the Central Railway in Mumbai. It is the second application of this sophisticated technology made by Bombardier for the Indian Railways.

India and Pakistan to increase freight train services

More freight trains might ply between India and Pakistan with the railways delegations of both countries deciding to explore running of longer freight trains and container train services in a meeting recently.
The two sides have agreed to eventually increase the frequency of trains to 5 pairs per day. At present 2 pairs of freight trains run between the two countries every day on the Wagah Attari rail link.

An official source said that several proposals to increase the level of freight interchange between India and Pakistan at Wagah and Attari were discussed, particularly with a view to increasing import of cement from Pakistan. They include running of increased number of freight trains between India and Pakistan and also to a time table, experimenting with longer trains, introducing some 8 wheeler wagons from Pakistan side and exploring the possibility of running of container train between the 2 countries. Introduction of freight services on the Munabao Khokhrapar rail link was also discussed.

Member panel to study Mumbai Port expansion plan – Report

Exim News Service reported that union ministry of shipping has reportedly formed a 11 member standing committee to resolve the issues between Mumbai Port Trust and the state government with regard to the expansion of the port and making available port land for the development of Mumbai city.

A notification issued by the ministry stated that the committee would have 6 representatives of the union government and the port, including the secretary of shipping, chairperson and deputy chairperson of Mumbai Port Trust, chief operations manager of central railway, joint secretary (ports) and chief engineer of Mumbai Port Trust. The 5 other members representing the state government would be the chief secretary, additional chief secretary (urban development), principal secretary (transport & excise), municipal commissioner of Mumbai and the metropolitan commissioner of MMRDA.

The committee will discuss issues of common interest to both Mumbai Port Trust and Mumbai, facilitating prompt approval for smooth implementation of various infrastructure development projects of the Port and the city and implementing the state government’s schemes for the rehabilitation of slum dwellers and project affected people.

It has been reported that the state government is opposed to the expansion plans of Mumbai Port as it fears that the development projects could worsen traffic congestion in the city. The state is also keen on the port opening up its surplus land on the eastern seaboard for development. The port authorities, on their part, have reportedly insisted that the Port has no surplus land.

Mumbai Port has lined up a number of projects, estimated to cost INR 5,000 crore, to augment its infrastructure and nearly double capacity in over 5 to 6 years. Among these are the ambitious offshore container terminal project, redeveloping four berths along the harbor wall and construction of an international cruise terminal.

Maharashtra to form a SVP to start Mumbai Tran harbor link

It is reported that, after Reliance Infrastructure failed to extend the validity of bids for the sea link project between Sewri and Nhava Sheva, Maharashtra government is now considering various options like forming a special purpose vehicle with financial support from the state run institutions, to go ahead with the project.

The state government may form SPV with funding from City & Industrial Development Corporation, Mumbai Metropolitan Region Development Authority and probably a Japanese bank. The project will be awarded to Maharashtra State road Development Corporation.

The government is also likely to consider the options like inviting fresh bids, close bidding or re bidding from qualifiers in the final round of bidding Reliance Infrastructure and Sea King Infrastructure.

Hindalco Industries announces 2007-08 results

Hindalco Industries Limited has announced the following audited results for the year ended March 31st 2008

The results for the year ended March 31st 2008
Hindalco Industries has posted a net profit of INR 28609 million for the year ended March 31st 2008 up by 11.5% YoY as against INR 25643 million for the year ended March 31st 2007. Total income is INR 196939 million for the year ended March 31st 2008 up by 5.4% YoY as against INR 186831 million for the year ended March 31st 2007.

The consolidated results for the year ended March 31st 2008
Hindalco Industries has posted a net profit of INR 23873 million for the year ended March 31st 2008 down by 11.1% YoY as against INR 26858 million for the year ended March 31st 2007. Total income is INR 606688 million for the year ended March 31st 2008 up by 207.5% YoY as against INR 197251 million for the year ended March 31st 2007.

ICMS Power plans wind turbine generator plant in TN

ICMS Power, the wind mill technology division of International Consultancy and Management Services, is looking at the scope of starting a wind turbine generator manufacturing plant for domestic and industrial application in Tamil Nadu.

Ms Saritha Biju Nair executive director of ICMS Power said that the wind turbine generator production plans would be the next priority once ICMS puts its marketing networking for its range of domestic wind turbines in the state in place.

Ms Nair claimed that the 600 watt capacity wind turbines, for example, which can generate a maximum 150 units of electricity at an optimum wind velocity of 1.8 meter a second, have the potential to generate 280 units with Tamil Nadu recording an average peak wind velocity up to 15.5 meter a second, especially during the peak April to November season.

ICMS Power formally launched marketing of 'Unitron UE' series of domestic wind turbine in Tamil Nadu that comes in four variants of 600 watt, 1500 watt, 3300 watt and 4200 watt capacity generators.

ICMS is already producing these domestic wind turbines indigenously at its Pune plant and is in the process of extending marketing across the country.

Mr RC Ravi director of ICMS Power said that "We have already sold 1600 units, largely in north Indian states in the last 2 years and now, we have started aggressively marketing in south, especially in Tamil Nadu, which has huge potential considering the current phase of difficult power situation prevailing in the region."

Considering the high wind potential in Tamil Nadu, the low breeze technology driven wind turbines produced by the company will be highly suitable to meet the power requirements of domestic and small-scale industries.

Mr JB Patnaik blames Orissa for delay of POSCO project

PTI reported that, with the South Korean steel major POSCO to complete 3 years of signing a MoU to set up a mega steel plant near Paradip without any success, opposition Congress today held Orissa government responsible for non implementation of India's biggest ever FDI.

Mr JB Patnaik leader of opposition and former chief minister of Orissa said that "I do not see any fault in POSCO. They have been waiting since 3 years to make a big investment in Orissa. But the state government failed to facilitate them to set up a 12 million tonnes per annum capacity steel mill."

Accusing Mr Naveen Patnaik government of not being able to provide land for the INR 52,000 crore project, Mr Patnaik said the state government's act of sticking to a particular site near Paradip had been the cause of delay.

Mr Pradip Amat state steel & mines minister said that the project would come up as the local people have started realizing it would benefit them. He added that, when POSCO came to India with an investment proposal, Orissa government welcomed them and promised to facilitate setting up of a port based steel plant.

Konkan Railway merger with Indian Railways unlikely

Putting to rest continued speculation about the merger of Konkan Railway Corporation Limited, Mr Anurag Mishra MD of KRCL, has ruled out its merger with the Indian Railways.

Mr Mishra said that "I do not see any chances of KRCL merging in the Indian Railways."

Mr Mishra said KRCL had convinced the Railways that the merger would have no tangible benefits to either. According to the original agreement between Indian Railways and KRCL, the latter was supposed to be merged after completion of 15 years or as soon as the debt liabilities of the corporation were met. But the view that the corporation should continue in its present status has prevailed.

Speaking about the financial aspects of the corporation on completion of 10 years, Mr Mishra said that it is all set to turn the corner and come into profits this fiscal after its losses came down to INR 150 crore last financial year. It has also crossed the figure of INR 500 crore in total annual earnings for the first time in its history. KRCL has achieved an operating ratio of 72.6%, which is an improvement of over 13% compared to the immediate previous year.

Hindalco to go for INR 5,000 crore rights issue

PTI reported that Hindalco board has approved rights issue for its shareholders up to INR 5,000 crore to pay a bridge loan taken for acquiring Novelis.

Mr Debu Bhattacharya MD of Hindalco said that the share ratio for the rights issue would be 1:3. For every one share held in Hindalco, its shareholders would be entitled to three equity shares. He added that "We are going for the rights issue to pay a bridge loan taken for Novelis acquisition."

Hindalco took a bridge loan of USD 3.03 billion for Novelis acquisition. The bridge loan has to be paid at the end of 18 months that comes to an end on November 10th 2008. For the remaining part of the bridge loan the company would opt either for a domestic debt or an international debt or liquidation of its treasury.

RIL denies signing any gas sale pact

ET reported that Reliance Industries denied that it has signed formal gas sale contracts with prospective customers in defiance of a Bombay High Court order. RIL was responding to a notice of motion by Reliance Natural Resources Limited which had alleged that RIL had signed such contracts.

The RIL counsel told chief justice Mr Swatanter Kumar and justice Mr VM Kanade of the Bombay High Court that media reports on the signing of gas agreements are erroneous and that the company has not signed any agreement.

Mr Paresh Chaudhary RIL spokesperson said that the court had dismissed the notice of motion. The notice of motion from Reliance Natural Resources had asked that RIL's appeal against a single judge bench order should be dismissed in view of alleged violations by RIL of the stay imposed by the court on signing of final contracts.

In 2007, the HC had ordered RIL not to sign formal contracts till the dispute with RNRL is settled. RIL is free to discuss and negotiate the terms of sale of gas to third parties. The company is learnt to be in discussions with various power and fertilizer plants across its East West pipeline to supply gas.

The case is now before a division bench. RIL may sign agreements for the sale of gas to third parties only after the court's decision is in RIL's favor. The case will come up for hearing before the division bench on July 22.

L&T bags high tech equipment orders worth INR 10,000 million

The Heavy Engineering Division of Larsen & Toubro Limited has crossed INR 10,000 million of order booking for high tech equipment & systems within 2 months of Q1 2008-09.

Major local contracts include a large order for power plant equipment from Coastal Gujarat Power Limited, a subsidiary of TATA Power Company Limited, for the first ultra mega power plant and another large contract from HPCL Mittal Energy Limited for critical reactors.

The export orders include supply of coke drums for Kuwait National Petroleum Company, high pressure heat exchangers from Petroleo Brasileiro, ammonia converters from UHDE and reactors from PTT Asahi Chem Company Limited of Thailand. The orders have been won against stiff international competition from Italian, Japanese & Chinese manufacturers and will be executed by L&T’s heavy engineering division.

Coastal Gujarat Power Limited contract includes supply of surface condensers, feed water heaters & deaerators for 5 units each of 800 MW for the UMPP being set up at Mundra in Gujarat. This would be the first UMPP being set up in India with state of the art supercritical technology for this 800 MW configuration. The equipment to be supplied by L&T forms a critical portion of the regenerative cycle of the balance of plant of this UMPP.

The HMEL contract is for 3 critical reactors required for their Punjab Refinery Project at Bathinda. Each of these reactors weigh about 700 tonnes and will be manufactured from advanced technology steels containing chromium, molybdenum and vanadium, with plate thickness up to 165 mm. L&T’s Heavy Engineering Division is amongst a select group of companies qualified for manufacture of such critical equipment.

Mr MV Kotwal member of the board & senior executive VP of heavy engineering division said that the demand for such critical hi tech equipment in India as well as abroad is on the rise. He added that "We are expanding our manufacturing facilities at Hazira in Gujarat and setting up a new facility at Oman, to cater to the rising demand."

J&K to upgrade transmission lines

It is reported that, stressing upon the judicious distribution of power, Jammu and Kashmir power minister Mr Babu Singh said that government is focusing on minimizing power losses due to faulty transmission lines and poles in Jammu division.

Mr Singh said that the work is afoot to replace the old transmission lines and poles besides up gradation of transformers in the division. He added that since the demography of the division has changed, the transformers are not able to sustain heavy load leading to frequent power breakdowns.

The minister sought the cooperation for generating awareness amongst people about payment of power tariffs and abstaining from tampering of meters and power theft. He said that the installation of meters in the households have almost been completed, which has led to transparency and accountability in the functioning of the department.

Mr Singh further added that the state government has collected INR 750 crore revenue as power tariff from consumers in the fiscal ended March 31st 2008. He said that Dul Hasti power project and Baghliar project soon would improve the power supply in the region.

Indian mild steel futures seen weak on monsoon – Report

Reuters reported that Indian mild steel ingot futures on National Commodity & Derivatives Exchange are likely to trade lower this week on an expected slowdown in construction activities with the onset of monsoon.

Mr Vishal Maniyar an analyst with Karvy Comtrade Limited said that a drop in iron ore prices on stock build up at ports in China will also weigh. He added that "Steel ingot futures are likely to remain weak during the week on less construction activity with the onset of monsoon."

Besides, prices of Indian iron ore for export dropped by 8% to 11% as stockpiles built up at Chinese ports, trimming demand from its leading customer. India raised the rate of export duty on long products, such as bars and rods, to 15% from 10% to improve their availability in the domestic market.

The rate of duty on iron ore was raised to a uniform 15% ad valorem to keep good quality ore and adequate supplies at a reasonable price in India. However, India exempted flat rolled products of iron and steel, including galvanized products, and pipes and tubes, from export duty.

The government's move to raise duty on exports of long products will boost local supplies but may not depress prices much as India is a net importer of long products.

SKIL close to getting Mumbai sea project

Sea King Infrastructure Limited has inched closer to bagging the project for the INR 6,000 crore, 22 kilometers long Mumbai Trans Harbor Link between Sewari and Nava Sheva.

The Maharashtra State Road Development Corporation, the nodal agency for the project, has decided to recommend to the state government that one of the options for taking the project forward is to ask the SKIL-IL&FS consortium to submit a fresh tender. The consortium was left as the sole bidder after RELINFRA Hyundai consortium pulled out of the race last week.

Mr Anil Deshmukh chairman of MSRDC and state PWD minister said that "The MSRDC board decided to tell the state government that the bid by the Anil Ambani controlled consortium is no longer valid as it has not submitted the letter for extension of the validity of the bid and that it should direct the corporation what action should it take."

Mr Deshmukh said that "We will also inform the government that there are 3 options, asking the only other bidder in the race, SKIL-IL&FS, to re bid, scrapping the process, or execution of the project by the MSRDC with funds from the state government."

Meanwhile, Mr Vilasrao Deshmukh chief minister of the state had asked the MSRDC to come up with a concrete suggestion at a meeting of the cabinet committee on infrastructure.

IJM Corp wins MYR 500 million highway deal in India

Reuters reported that Malaysian builder IJM Corporation Bhd has won a MYR 500 million contract to construct a highway in India.

Moser Baer hopeful of cutting solar energy cost

At a time when crude prices are peaking, a reduction in solar power costs could brighten the energy scenario. The solar photovoltaic business, which incurs a generation cost of INR 12 to INR 14 per unit, is looking at reducing it to INR 4 to INR 6 a unit in the next 3 to 5 years. The reduction would mainly be on the back of anticipated easing of global demand supply imbalance of silicon, advances in thin film PV, higher cell efficiency and other innovations.

Mr Ravi Khanna CEO of Moser Baer Photo Voltaic Limited said that "Depending on various factors, 1 MW of solar energy involves an investment of USD 5.5 to USD 7 million. This is going to come down to the USD 3.5 to USD 5 million range in short to medium term. In the next 10 years it may go as low as USD 2.5 million per MW. In terms of generation cost, today I can give power at about INR 14 per unit and our roadmap clearly shows us a visibility to hit INR 4 to USD 6 per unit."

In contrast, the average cost of generation at coal-fired thermal stations is around INR 3 a unit. Gas based generation costs higher at around INR 4 to USD 5 a unit, while liquid fuel based generation costs over INR 7 a unit. However, industrial power purchasers are willing to shell out higher tariffs upwards of INR 7 a unit to meet the peaking shortages at these high tariffs.

Moreover, Mr Khanna pointed out that optimization in processes and equipments, customized for the PV business, could yield 25% to 50% cost benefits. He added that "For instance, PV players have been procuring silicon wafers of very high purity level which is not ideally required, so we have invested in a firm in Slovenia where we are producing solar grade silicon and optimizing quality."

Globally, solar energy plants with huge capacities have started dotting the PV horizon. These include a 300 MW solar facility in New Mexico, 280 MW Solana Solar plant in Arizona, 154 MW project in Australia. In India, Moser Baer Photo Voltaic has signed MoU with Rajasthan for setting up a large solar power project with an estimated generation capacity of 1 MW to 5 MW. The project would be the largest grid connected solar farm in India. Although the company refused to comment on the tariffs for the project, the subsidy level is likely to be about INR 10 to INR 12 per unit.

India to set up 6 nuclear plants with Russian support – Report

Mr Jairam Ramesh union minister of state for power said that the Nuclear Power Corporation will set up 6 more plants to produce 8,000 MW on Kudankulam mode with Russian fuel support. Pointing out that the first consignment of enriched uranium had arrived from Russia, he said that the first 1000 MW unit at Kudankulam would be commissioned in April 2009. Another 1000 MW unit would start functioning in December 2009.

Mr Ramesh said that "Without the nuclear agreement, the support of International Atomic Energy Agency and Nuclear Suppliers Group countries, we cannot get fuel from Russia for the proposed projects."

Referring to a number of power projects proposed by central public sector undertakings in the state, Mr Ramesh said that work on the 14 year old proposal to establish a 1,600 MW thermal power project at Jayamkondam was progressing well. The third phase of 500 MW project of the Neyveli Lignite Corporation would be commissioned in March 2009.

Meanwhile, Mr Arcot N Veeraswami state electricity minister said that an order had been issued for importing coal from Indonesia, Australia and China for merchant power projects. The imported coal would have just five per cent ash content compared to 40% ash content coal available in India.

HEC commissions hot coke car

Heavy Engineering Corporation Limited has commissioned a hot coke car with coke bucket. The equipment is being dispatched to Rashtriya Ispat Nigam Limited’s Visakhapatnam Steel Plant for its newly built 7 meters high coke oven battery number 4.

The car will receive red hot coke at 1,100oC from the COB and transport it to the quenching chamber where it is quenched to 200oC through inert gas. The heat absorbed by the inert gas is used to make steam that is in turn used to generate power.

Triveni Engg inks MoU with TGM Turbinas for turbine unit

Projects Today reported that Triveni Engineering & Industries Limited has signed a MoU with TGM Turbinas Industriae Commercio Limited of Sao Paulo, wherein both parties have undertaken to conclude a license agreement for the manufacture and sale of impulse and reaction steam turbines of 25 MW to 45 MW at the company's Bangalore facility.

Krishnapatnam port to be dedicated to the nation by July 17

Projects Today reported that Ms Sonia Gandhi UPA chairperson is likely to formally dedicate to the nation Krishnapatnam port project on July 17th 2008.

The proposed port at Krishnapatnam became operational on June 19th 2008, with 3 out of its 4 berths being opened for regular traffic of cargo or container ships. Over INR 2,000 crore was invested in the project so far.

The Andhra Pradesh government had awarded the project to Krishnapatnam Port Company on a build own operate and transfer basis.

Ashoka Buildcon to invest INR 535 crore for Bhandara road project

It is reported that Ashoka Buildcon is planning an investment of INR 535 crore in the construction of Bhandara road project, which will connect Chhattisgarh and Maharashtra.

The road project involves construction, operation and maintenance of a 320 kilometers long four lane road section of NH 6 from the Chhattisgarh Maharashtra border to the Wainganga Bridge section from 405 kilometers to 485 kilometers of the NH 6. This will be part of the Golden Quadrilateral connecting Raipur with Nagpur, Mumbai and Pune.

Under the terms of the concession agreement, the construction of the project is to be completed by March 2010. NHAI will give a grant of INR 10 crore to Ashoka Highways (Bhandara) during the construction phase of the project. The toll rates are set forth in the concession agreement with a clause to revise the rates every year with effect from September 1st 2008 as per the changes in the Indian Wholesale Price Index each fiscal year.

Ashoka Buildcon, through its subsidiary Ashoka Highways Limited, will implement the project.

Gas based power projects hit by feedstock paucity

BL reported that India has about 13,400 MW of natural gas based power capacity, but they are operating at half their capacity, because enough gas is not available.

Mr Jairam Ramesh union minister of state for power said that "The situation is not very encouraging as the plants are operating at just 53% PLF." He added that however, the situation could improve once Reliance Industries commences gas supply from its fields in offshore Krishna Godavari basin.

He said that Reliance is expected to supply 80 million cubic meters of gas a day from March 2009. When that happens, power plants could operate at 90% PLF.

Mining industry is backbone of state economy – Goa CM

Mr Digambar Kamat chief minister of Goa said that the mining industry is the backbone of the state economy and therefore this industry must not suffer. He added that there are damages and effects due to mining activities but if certain precautions are taken, the adverse effects can be minimized.

Mr Kamat asked the mine owners to shoulder their responsibility in safe guarding the environmental growth and take measures for minimizing pollution caused due to mining activities. He asked the people to plant trees in order to maintain the environment balance.

He also said that people should not oppose mining for the sake of opposing it on the contrary there is need to lessen the gap of understanding between people and mining industrialists. He came down heavily on the opposition who make baseless allegations and criticize the government and said that people should not get misguided by such false propaganda.

JCB India awaits land allotment for expansion

BS reported that leading construction equipment manufacturer JCB India is awaiting allotment of land from Maharashtra Industrial Development Corporation for its facility expansion plans.

The report said that JCB India has demanded another 100 acre land next to its 2 present units in Talegaon near Pune, to which the government of Maharashtra is yet to react.

Meanwhile, JCB has inaugurated a new dealership facility in Pune along the Mumbai Bangalore national highway. The facility would be run by Siddharth Auto Engineers.

Mr Vipin Sodhi MD & CEO of JBC India said that "We need around 100 acre land for our immediate expansion plans. We have forwarded a proposal in this regard to the state government. However, we are yet to hear from state-owned MIDC over the land allotment."

JCB has decided to have an expanded set up in Talegaon ready by December 2008. The present situation however has ensured that the land allotment itself will happen by the year end. JCB, in November 2007, had inaugurated its excavator manufacturing unit in Talegaon industrial area, when the demand for the next piece of land was forwarded.

Indian Railways to invite bids for Pune Ahmedabad high speed corridor

Projects Today reported that Indian Railways is planning to float a global tender from consultants for conducting a pre feasibility study for Pune to Ahmedabad high speed corridor.

A consultant will focus on technicalities, financial and operational viability of the project. The pre feasibility study will be followed by a more detailed study focusing on traffic pattern, funding plan, stakeholders' view, fare structure and other related issues before beginning the work.

The proposed high speed train or bullet train is expected to run at 300 kilometers per hour on a dedicated fast track. The cost of the pre feasibility study will be shared by Maharashtra, Gujarat and the union railways ministry.

Preliminary works underway for ChPT container terminal

It is reported that preliminary works are underway for setting up Chennai Port Trust's INR 1,300 crore container terminal at Gerugambakkam in Kancheepuram district.

Chennai Port Trust is in the process of acquiring 64 acres of land for the project.

ONGC unit awards INR 2200 core contract to BHEL & GE

Oil & Natural Gas Corporation said that its unit ONGC Tripura Power Company had placed an INR 2200 crore order with a consortium of Bharat Heavy Electricals Limited and General Electric.

ONGC Tripura Power Company, 50% owned by ONGC, has given the order for generation of 720 MW of power in Tripura.

ONGC also said that Power Grid Corporation, ONGC Tripura and the North East Region would set up a transmission line at a cost of INR 1800 crore.

India to decide on IPI pipeline project soon – Report

PTI reported that India will sign an agreement very soon with Iran and Pakistan in connection with the transnational pipeline project involving the 3 countries.

Mr Murli Deora union petroleum minister after a meeting with his Iranian counterpart Mr Gholam Hosein Nozari for talks on the USD 7.5 billion IPI pipeline project said that are some minor problems which have been sorted out. He added that "There are also some issues with Pakistan that has been taken care of. The Pakistan oil minister has changed and so we have to deal with the new minister who is going to deal with it. Very soon we should be able to sign the agreement with Iran and Pakistan."

The project was first mooted in 1994 but has been stalled by a series of disputes over prices and transit fees.

Cairn to begin pipeline laying to ferry Rajasthan crude

PTI reported that Cairn India will begin laying a USD 800 million pipeline to evacuate crude oil from its Rajasthan fields, peak output from where is now seen at 175,000 barrels per day, 17% more than the previous estimate.

Cairn India has awarded the pipeline laying contract to Larsen & Toubro, who is to complete the job in 6 to 9 months time, in sink with the company's oil production plans.

The heated pipeline for transporting crude oil from the Rajasthan fields will begin at Mangala terminal to Salaya oil export terminal near Jamnagar in Gujarat. Crude oil production from the Rajasthan fields is to begin in second half of 2009 even as estimates for peak output have been raised by about 17%.

Sources said Mangala, the largest field in the RJ-ON-90/1 block, was previously envisaged to produce 100,000 barrels per day but discovery of additional reserves has raised the output to 125,000 barrels per day. Bhagyam, the second biggest field, will produce 40,000 barrels per day and Aishwariya 10,000 barrels per day, totaling to 175,000 barrels per day.

Sources said the government has approved shifting of the crude oil delivery point from the Rajasthan field flange to Salaya in Gujarat and including the cost of laying the 585 kilometers long pipeline from Barmer to the new sale point in the field development cost that would be recovered by Cairn from sale of oil.

Golden Rock workshop exports 3 locos to Mozambique

BL reported that Golden Rock Railway Workshop has exported two in service diesel locos to Mozambique after refurbishing them to suit the requirements of the railway system of Mozambique.

The modified engines have been provided with Centre Buffer Coupler in lieu of the existing ABC Coupler. The meter gauge engines were converted as cape gauge to suit the Mozambique system.

The refurbished engines have also been provided with dual brake system in place of vacuum brake, twin beam head lights for improved night visibility, micro processor based paperless speedometer, LED type classification lights and LED type reading lamps in the driver’s cabin. The cabin has been modified with various crew-friendly features.

The Golden Rock Railway Workshop has also bagged a fresh order from the Rail India Technical & Economic Services to export 3 diesel locomotives to West African country Benin. The workshop would carry out necessary modifications in three diesel locomotives and export them in four months’ time.

NMPT wins best export facilitation award

BL reported that Federation of Karnataka Chambers of Commerce & Industry has given the special award for the best export facilitation organization to New Mangalore Port Trust.

Mr S Gopalakrishna traffic manager of NMPT received the award from Mr Venkataramanappa minister for small scale industries & sericulture of Karnataka.

Federation of Karnataka Chambers of Commerce & Industry has been giving export excellence awards since 2006 to honor the top exporters.

Acute shortage of HRC pushes prices by 6% in last 7 days

The price data for last 7 days has revealed that the price of tube grade HRC has surged by 6% during the last 7 days in Mumbai.

Prices are in INR per tonne inclusive of ED and VAT
Delivery is EX Mumbai

Such a huge surge is attributed to limited supply amid booming demand. Market is facing acute shortage. As per market information, HR manufactures are not willing to supply in the domestic market. This situation could be a signal for an impending price increase.

(Sourced from www.steelprices-india.com)

Steel futures would not help volatility -ArcelorMittal

Mr Michel Wurth a member of the group management board of ArcelorMittal during a steel conference in London told delegates that the best way to cope with volatility in steel prices could be greater integration or increasing capacity, but futures contracts won't help.

Mr Wurth said that studies showed that futures brought further volatility to markets and that ArcelorMittal did not see any use for the contracts.

ArcelorMittal along with other several major steel producers, has repeatedly dismissed efforts by exchanges to offer steel futures to the USD 800 billion industry.

He said that becoming a much more integrated steel producer could be a solution adding that the company was trying to boost its self sufficiency in iron ore, currently just below 50% to around 70% by 2012.

Mr Wurth said the company was aiming to increase its shipments and its capacity. We are investing in green field capacity. It’s roughly another 25 million tones.”

EU steelmaking facing major challenges - EUROFER

According to Mr Karl Tachelet of EUROFER, the European Union is one of the most challenged steelmaking regions in the world and is at risk from carbon leakage, a loss of international competitiveness and changing trade flows.

Mr Karl Tachelet at the SBB steel conference in London told delegates that “Steel demand would also continue to be driven by emerging economies as they sought to meet the requirements of their expanding industrialization and infrastructure projects leading to a rapid expansion of global steel capacities. And while China continues to dominate the global steel production table, he said that the country was not a low-cost region for steelmaking as it depended on a significant level of raw material imports.”

He said that there has been a clear indication of rising Chinese steel exports since March, which in turn had fueled rumors of additional finished product export restrictions from the country, describing China's steel industry as playing a game of catch me if you can.

He also that China and India were increasingly using export restriction measures against one another which meant that other consumers of raw materials are being discriminated against. Mr Tachelet said that "It is a vicious circle which creates new distortions on the international as well as the domestic markets.”

He added that “Europe would continue to be the destination choice for steel production outside of the Asian neighborhood, but said the explosion in the cost side of steelmaking was forcing steelmakers to pass on increases to their customers. The EU is not isolated from the world. Cost increases are putting cost values to the test.”

Delegates were also told that “EUROFER has serious concerns about the European Union Emissions Trade Trading scheme imposing additional costs on steelmakers which are not incurred by the bloc's competitors. Carbon leakage whereby steelmaking operations could be switched to countries without emissions cap regimes could occur, as a result of EU policy and the loss of international competitiveness.”

Japanese ERW pipe exports to North America

TEX reported that Japanese integrated steelmakers will study whether to set offer prices at USD 1,500 per tonne FOB or beyond in their deals of ERW pipe exports to North America for shipments in the October to December quarter.

As per report Japan are scheduled to start their ERW pipe export negotiations with local steel stockiest in late July on October to December shipments.

In this connection, the Japanese steelmakers assume that they will negotiate exports of HR coils, the material for ERW pipes at USD 1,200 to USD 1,300 per tonne FOB for October to December shipments.

The Japanese steelmakers are supposed to provide ERW pipes at USD 1,250 per tonne FOB for the API X40 16in product under the existing contracts with steel stockiest in North America for July to August shipments. The ERW pipe price under contract is based on a trend of negotiated prices in Japanese HR coil exports. In April this year, Japanese export deals of HR coils were settled at USD 750 per tonne FOB for South Korea. Then, Japanese export prices of HR coils for Asian destinations moved up to USD 800 to USD 850 per tonne FOB.

Japanese export prices of HR coils are settled at USD 1,000 per tonne FOB for July to September shipments to South Korea. Besides, there are cases of prices at a level of USD 1,100 per tonne FOB in negotiated shipments to Southeast Asia and Latin America.

In the USA, the going prices of ERW pipes for store sales are beyond USD 1,400 per tonne, while the domestic HR coil market is assessed at USD 1,250 per tonne. The domestic HR coil market is forecast to advance more in rising prices of slabs.

(Sourced from TEX Reports)

ArcelorMittal Dofasco ramping up Hamilton operation

The Canadian Press reported that ArcelorMittal Dofasco is pumping USD 119 million into its Hamilton operations in a bid to boost steel production by 20%.

As global steel prices continue to soar, the Hamilton steel maker will spark up a third blast furnace, increase use of its electric arc furnace and restart 20 dormant coke ovens. Together, the improvements are expected to hike annual steel production to 5 million tons from 4.2 million tons.

Mr Juergen Schachler CEO of Dofasco said that the upgrades will lay the foundation for a longer term vision and investments, still under consideration by ArcelorMittal Dofasco.”

He added that the largest portion of Dofasco's investment will go toward reviving the No 3 blast furnace, idle since 2005. The firm will refurbish the inside of the furnace and outfit it with a pulverized coal injection system, reducing its dependence on costly coking coal.

US wire rod prices increase again

The wire rod price from US domestic mills will rise by USD 66 per ton in July 2008 but the import wire price will be higher than the new domestic market price. Therefore, even though the buyers think that the price is rising too fast and too high, they will still finally have to accept the domestic price offer.

After adjustment, the new low carbon wire rod product price will be about USD 1,191 per ton to USD 1,213 per ton and that for high carbon wire rod product will be about USD 1,246 per ton to USD 1,268 per ton.

On the other hand, people believe that some US wire mills have still planned to raise their wire rod prices again in August to bring price levels closer to those of the global market.

(Sourced from YIEH.com)

Taiwan slab import prices continue soaring

It is reported that slab price has already reached as high of USD 1,075 to USD 1,080 per tonne CFR Taiwan, continuing its upward trend. Moreover, it is said that the highest price was settled around USD 1,150 per tonne but this is doubted by the industry.

China Steel’s blast furnace accident, causing a slab shortage in the market, could be the main reason for slab prices to soar, according to a trader.

(Sourced from YIEH.com)

Vietnam wants lesser pig iron exports - Report

VNS reported that Vietnam’s ministry of industry and trade is planning to submit to the Government a proposal to hike the export duty on steel ingot after which the maximal rate could reach 10% from the current 2%.

According to the ministry, the move needs to be made as the export of steel ingot is alert. It said that the country has so far this year exported more than 100,000 tonnes of steel ingot, mainly to South Korea, Malaysia and Thailand. The ministry added that however, there was no need to ban the exports of steel ingot at the moment.

Mr Le Duong Quang deputy minister of Vietnam said that local steel ingot producers argue that they have had to export products due to a sharp drop in domestic demand in the wake of the government’s decision to lower the targeted growth rate in an effort to curb inflation. This has resulted in a delay in many construction projects. Currently, a tonne of steel ingot is being offered at price of USD 1,150.

He added that this is why the industry and trade ministry wants to find measures to limit exports of steel ingot to ensure the demand for construction materials in the local market is met while simultaneously ensuring steel businesses do not face difficult situations.

Mr Quang said there would be no shortage of steel until the end of August, but a shortage might occur if the Government does not take bold measures on the steel ingot exports.

According to Viet Nam Steel Association, the country would need 4 million tonnes of ingot steel this year. Steel ingot is a major raw material for steel mills in Viet Nam, which produces steel mostly for construction purposes.

Tenaris increase on speculation of Chinese pipe import decision

Bloomberg reported that Tenaris SA surged as much as 10% to a record of EUR 24 before closing up 2.4% to EUR 22.28 in Milan trading on speculation the US may impose restrictions on Chinese imports. Other pipe makers including Vallourec SA of France and Spain's Tubacex SA also advanced.

Cassa Lombarda said in a report that “The imposition of duties on Chinese imports would substantially modify the outlook for the US market which so far has been penalized by fierce competition. This will have a positive impact on Tenaris.''

US International Trade Commission last year said it's investigating whether China sells pipes in the US below market value. If the commission finds that unfair trade practices have hurt American industry, the US Department of Commerce can impose an antidumping duty.

Ha Tinh gives license for Son Duong Port and Steel complex to Formosa

Nhan Dan reported that the Vietnam People's Committee of the central province Ha Tinh has presented an investment license for Son Duong Port and Iron and Steel Complex to Ha Tinh FORMOSA Hung Nghiep Iron & Steel Company Limited.

The envisaged investment of USD 7.88 billion is the biggest foreign direct investment ever granted in Vietnam so far.

The project includes steel plant with capacity of 7.5 million tonnes a year, which will be raised to 15 million tonnes per year in the second period.

Port Son Duong to serve the steel plant will be constructed in the area of over 3,000 hectare in which more than 1,000 hectare of water surface in Vung Ang Economic Zone in Ha Tinh province.

CAP shares glisten on dull Santiago bourse

BNamericas reported that Chilean integrated steel producer CAP has been one of the best performers on the Santiago bourse this year, despite the exchange's modest overall showing.

The report added that shares in CAP, which produces steel and iron, have risen 34.1% this month and 60.7% since the start of the year as of Friday, when they closed at 21,599 pesos, down 3.33% from the day before.

The CAP group's subsidiaries have also performed well. Cintac, CAP's specialty steel products unit, has risen 28.2% since January 1 although it retreated 2.32% in June.

Molybdenum producer Molymet has risen a more modest 4.87% since the start of the year despite a 1.32% decline this month.

Meanwhile the Santiago bourse's IPSA index, which measures the 40 most traded shares with a market cap of at least USD 200 million has crept back 0.56% since the start of the year.

Kanto Tetsugen allows Arae Shoukai in scrap export tender

TEX reported that Japan's Kanto Tetsugen cooperative association of ferrous scrap dealers held a meeting of its board of directors June 9th 2008 and approved Arae Shoukai Co's participation in Kanto Tetsugen's monthly export tender as a new entrant.

Arae Shoukai made a request in writing to Kanto Tetsugen in late April for approval of its entry into the monthly export tender. Until now, Arae Shoukai has virtually taken part in Kanto Tetsugen's monthly export tender in the form of borrowing the bidding right of Kusano Co Ltd. Kusano is one of the 15 designated trading companies with separate rights to bid for purchases in Kanto Tetsugen's monthly export tender.

Kusano's entry into Kanto Tetsugen's monthly export tender took effect from November 2004. The company boasts a cumulative 230,000 tonnes of purchases in its successful bids so far, raking second after JFE Shoji Trade Corp. Most of Kusano's successful bids in the past were de fact achievements by Arae Shoukai on the basis of the borrowed bidding right from Kusano.

(Sourced from TEX Reports)

Sidenor gets new board of directors

The Board of Directors of the Capital Market Commission of Sidenor SA announced that following company's Annual Ordinary General Shareholders Meeting of June 10th 2008, the new Board of Directors convened at the same day and was constituted as a body as follows:

1. Mr Georgios Kalfarentzos chairman of BoD executive member
2. Mr Nikolaos Koudounis vice chairman of BoD executive member
3. Mr Sarados Milios member of BoD executive member
4. Mr Dimitrios Paraskevopoulos member of BoD non executive member
5. Mr Athanassios Mitropoulos member of BoD non executive member
6. Mr George Passas member of BoD executive member
7. Mr Ioannis Ikonomou member of BoD non executive member
8. Mr Andreas Kyriazis member of BoD non executive and independent member
9. Mr Efstathios Strimber member of BoD non executive and independent member

Maritime Capital plans USD 261 million IPO

Bloomberg reported that Hong Kong dry bulk shipping line Maritime Capital Shipping Ltd is planning to raise about USD 261 million in an initial share sale in Singapore to buy more vessels.

According to an e mail to investors, Maritime Capital Shipping Ltd plans to sell existing and new shares at between USD 1.24 to USD 1.46 apiece. But the e mail did not include how many shares will be sold. Pricing is scheduled on July 3rd 2008 and shares will be offered to retail investors the following day.

Maritime Capital wants to almost double its fleet size to as many as 30 vessels, according to the company's prospectus. Rising demand from emerging countries, such as China and India for iron ore and coal have increased the need for more vessels to support economic growth.

UBS AG is the sole arranger of the share sale.

Daehan first ship named at new yard

Lloyd’s List reported that emerging South Korean shipyard Daehan Shipbuilding named its first ship last weekend at its yard located in Haenam.

The Mystic a 170,500 DWT bulk carrier, is the first in a series of 8 similar vessels ordered by the Norwegian Golden Ocean Group in November 2006.

According to Lloyd’s List, the second vessel in the series will be delivered in August 2008.

South Korea may seek to join Orinoco oil project in Venezuela

Bloomberg reported that South Korea, which imports almost all of its fuel needs, may seek to develop oil and gas fields in Venezuela to help stabilize its energy supply.

Korea's Ministry of Knowledge Economy said that South Korean officials discussed the possibility of joining in a project to develop reserves in the Orinoco Belt with state oil company Petroleos de Venezuela SA.

South Korea is stepping up efforts along with China and Japan to own oil and gas fields as crude prices surge to records. Oil doubled in the past year, touching a record USD 139.89 a barrel on June 16.

The report added rthat a South Korean consortium led by Korea National Oil Corp may bid to develop two Orinoco areas, Carabobo 1 and 4.

Venezuela has the world's third largest proven crude oil reserves. National oil companies from countries including China, Vietnam and Iran are taking part in Venezuela's project to quantify and certify reserves in the Orinoco region, which holds so called heavy oil.

ArcelorMittal announces acquisition of Mid Vol Coal Group

ArcelorMittal the world's largest integrated metals and mining company announced that it has signed an agreement to acquire the Mid Vol Coal Group.

Mid Vol located in southern West Virginia and southwestern Virginia in the Central Appalachian Coal Basin, produced 1.5 million tonnes of metallurgical coking coal in 2007 and has estimated recoverable saleable reserves and resources in excess of 85 million tonne.

Mr Aditya Mittal, Chief Financial Officer and member of ArcelorMittal’s Group Management Board said that “This acquisition further increases our upstream self sufficiency in a primary raw material during a time when metallurgical coking coal demand on a global scale remains strong. ArcelorMittal is currently the largest customer of Mid Vol and the quality of the coal produced meets that demanded by our coke making facilities. It is our intention to double the production level at Mid Vol in the short to medium term and permits have recently been granted to the operation which will facilitate this.”

Rebar prices in Middle East - Where are we heading….

The history is in creation, First time in the life cycle of steel, rebars as product has seen such a robust demand in Middle East region, which has resulted in unimaginable price levels.

As reported last week end, the domestic rebar prices in UAE have touched unprecedented and absolutely unimaginable USD 1500 per tonne last week.
http://steelprices-middleeast.com/news/index/2008/06/20/MTYwMA%3D%3D/
Rebar_prices_in_UAE_cross_USD_1500_mark.html

Import price levels, for shipments arriving in various months are tabulated below to outline the trend in last 9 months, which clearly indicates that rebar prices in UAE have been increasing steadily and the plateau is yet to be seen. Today, to predict the expected price in the fourth quarter is anybody’s guess.

Prices indicated are for shipments in respective months
Prices are in USD per tonne on CFR UAE basis
The prices are indicative and some transactions may have taken place outside these ranges

There are so many question marks as the raw material price hikes for main ingredients for steel makers like iron ore, coking coal, coke and ferroalloys, despite steep increases in price levels are facing sever demand pressures amid limited supply. Price of energy has reached sky high levels and is likely to further go up. Shipping costs are skyrocketing. Or it is just the that investors are speculating

The main steel exporting countries CIS countries have shifted main focus of their products toward the domestic consumption as they are getting better realization, Therefore GCC countries are mainly depending on the Turkey as the main supplier due to main reasons as the product required to be rust free or blue steel and CARES approved.

China is catching by providing the requirements but domestic demand inside china keeps export dynamics changing. The main change which is happening is today the availability of the rebars has eased a bit of late as there are lots of cargoes offered by the speculators physically in the GCC market.

(Sourced from www.steelprices-middleeast.com)

Views and feedback on this matter from our readers is solicited and shall be published if deemed fit. Pl send mail at editor@steelguru.com

Tulsyan NEC inks MOU with Suhayl for steel plant in Saudi Arab

NDTV reported that Tulsyan NEC of India has signed a MoU with Suhayl Abdul Mohsin Al Shoaibi & Sons Holding Company for the proposed steel plant having capacity of 500,000 tonnes per annum in Saudi Arabia.

Manazil to develop light steel framing solution in Abu Dhabi

Genesis Worldwide Inc said that its United Arab Emirates licensee Manazil Steel Framing Factory has signed a construction contract to produce and install Genesis' light steel framing solution for a large development of 30 villas in Abu Dhabi.

Genesis Worldwide said that its Manazil plant in Abu Dhabi will begin production of the panels at the end of August 2008 with installation beginning in mid September 2008.

Genesis, which provides structural building technology using light steel, said that the Naser Alnwais development will consist of 14 duplexes and 2 single villas with an average of 4,366 square feet per villa and the total project size is 130,974 square feet.

Manazil, a unit of Khalifa Al Fahad Company of Abu Dhabi, is licensed as the sole provider of Genesis building systems in the UAE and Qatar.

Artoc Steel acquires majority stake in Alpha Metal

Al Akhbar reported that Artoc Steel Corporation, affiliated to Artoc Group for Investment & Development, has acquired majority stake in Alpha Metal for Construction & Metallic Industries.

Mr Yasser Darwish investment manager at Artoc Group said that it now controls 70% stake in Alpha Metal. He identified Alpha Metal Co as a leading steel fabricator & contractor for pre engineered & steel structure buildings.

He predicted such distinguished position on the market would be further enhanced by Artoc Group experiences both at home & abroad.

Saudi Arab decision of boosting output lowers oil prices

Oil prices eased slightly following a wild, record setting session as investors weighed expectations of higher Saudi Arabian output against the market's ability to quench soaring global demand.

Light sweet crude for July 2008 delivery fell 62 cents to USD 133.99 a barrel on the New York Mercantile Exchange, but posted occasional gains. In London, August Brent crude futures fell by 73 cents to USD 134 on the ICE Futures exchange.

Crude prices fluctuated widely at the start of the week, surging at one point to a record USD 139.89 per barrel and tumbling as low as USD 132.84 before settling at USD 134.61 a barrel, down by 25 cents.

Mr Victor Shum an energy analyst with Purvin & Gertz in Singapore said that price swings of USD 5 a barrel are not unusual anymore. He added that "The issue really is global oil demand is growing at a reasonable pace and supply is still playing a catch up game."

DP World to acquire 60% stake in Tarragona container terminal

Dubai based port operator DP World is to acquire a 60% stake in Contarsa Sociedad de Estiba, a privately owned company that holds the exclusive concession for Tarragona container terminal in northern Spain.

The transaction has received approval from the Tarragona Port Authority and is awaiting European Union regulatory clearance.

Tarragona Port is located in the Mediterranean near Barcelona, serving the hinterland of northern and central Spain. It has the potential to expand and to attract cargo seeking alternatives to nearby ports.

Mr Mohammed Sharaf CEO of DP World said that "Tarragona is very well placed to service a large market; the city has recently attracted investment from major multinational distributors, attracted by its established infrastructure links.''

Mr Flemming Dalgaard DP World's senior VP & MD of Europe and Russia region said that "Tarragona has great potential for future growth, with room for expansion, a deep water draft and excellent direct road and rail connectivity to both Barcelona and Madrid."

HHI to supply 144 diesel based power plants to Iraq

It is reported that Hyundai Heavy Industries won a USD 380 million order from the Iraq government to supply 144 Diesel Power Plants.

The Diesel Power Plants which have a total capacity of 360MW and can provide electricity to 120,000 households, will be installed by April of 2009. HHI has so far been contracted to supply a total of 180 Diesel Power Plants to Iraq.

Hyundai Heavy Industries has two types of Packaged Diesel Power Facilities, the Diesel Power Plant and the Packaged Power Station. Both types are easy to install and convenient to use in challenging environments and areas that have a poor electrical infrastructure.

The company has exported 973 Packaged Diesel Power Facilities to 23 countries throughout South Asia, the Middle East, South America, Europe, and Africa. With this order, the total export number will climb past the 1,000 mark.

Hyundai Heavy Industries exported 644 Packaged Diesel Power Facilities to Cuba in 2005 for a total of USD 850 million, which was equivalent to six times the annual trade between South Korea and Cuba.

Mr Yoo Seung Nam COO of Hyundai Heavy Industry’s Engine and Machinery Division said that “The HiMSEN Engine, which is used in all of the Packaged Diesel Power Facilities, was developed by HHI. Due to the reliability of the HiMSEN Engine, there are continuous order enquiries from South America and the Middle East.”

Elgi Equipment sets up subsidiary in Gulf

Industrial air compressors manufacture Elgi Equipments Limited has announced opening of its subsidiary at Sharjah Airport International Free Zone in the UAE.

The subsidiary 'ELGI GULF FZE' is a full fledged sales and service organization through which the company intended to offer prompt and speedy service deliveries, with short lead times to the customers.

Mr VT Govindarajan director global business of EEL said that the office cum warehouse facility would enable it in expanding the product offering and ensure immediate service in the fast growing Middle East market. He added tat Elgi Gulf would initially serve the GCC markets and eventually expand its presence in the Middle East region and North Africa.

Dr Jairam Varadaraj MD of EEL added that it enjoyed a significant market share in the Middle East region for electric and portable screw air compressor. He said that "Being one of the leading exporters of products to end user in over 60 countries, Middle East contributed to more than 20% of the company’s sales."

USD 147 million draining out annually from Pakistan on imports– Report

Business Recorder reported that an enormous amount of USD 147 million is draining out of Pakistan annually on imports alone due to fictitious on port recoveries by the shipping lines, agents and terminal operators.

According to sources, the traders, both importers and exporters, are being charged under different fictitious heads in violation of the applicable rules and international best practices. They said that the terminal operators and shipping agents are charging a levy from the traders in the name of terminal handling charge and delivery or R&D which were not specified in schedule 9 of a federal government backed implementation agreement.

Source said that according to an estimate at least 800,000 TEUs were being landed and shipped annually through the said terminals where PKR 8,500 were being charged by the shipping lines or agents and PKR 3,500 by the terminal operators. Thus, taking the drained amount to PKR 9,600 million or USD 147 million on import alone, leave aside the exports.

Iran to inaugurate 10th olefin project

Mehr News Agency reported that Jam Petrochemical Complex's 10th olefin project will be officially inaugurated in Assaluyeh region in a ceremony attended by President Mr Mahmud Ahmadinejad.

Jam petrochemical’s 10th olefin project’s executive operation was started in the Persian calendar year 1379 (March 20th 2000 to March 20th 2001) with the aim of producing yearly 3.3 million tones of ethylene, propylene, high density polyethylene, low density polyethylene and other byproducts in Assaluyeh.

The major contractors of the project are France’s Technip Company, Germany’s Krupp Uhde Company, Italy’s Technimont Company and Iran’s Nargan and Sazeh companies.

Currently, Farsa Chimie Company plant is under operation in an area of 11 hectares at Jam Petrochemical Complex which is located in Assaluyeh on the coastline of the Persian Gulf. By making use of advanced technology the company has the capacity to produce annually 400,000 tonnes per year mono ethylene glycol, 40,000 tonnes per year diethylene glycol and 2,800 tonnes per year tri ethylene glycol to meet the growing global demand and export to international markets.

Jam Petrochemical Complex is responsible for implementing of the 10th olefin project in an area of 77 hectares which more than 40 hectares has been reclaimed from the sea. It will be one of Iran’s largest olefin plants with the final production capacity of 1,320,000 tonnes per year including HDPE, LDPE, BD, and PP.

P&O Maritime Services expands business in MEA

Khaleej Times reported that P&O Maritime Services, a wholly owned Australia based subsidiary of global port operator DP World, has expanded into the Middle East, providing vital support at DP World’s flagship Jebel Ali terminal and throughout the UAE region.

P&O Maritime Services will build on the existing DP World maritime operations, ensuring the maintenance and evolution of safety standards, staff training and improved utilization of marine assets.

Mr Mohammed Al Muallem senior VP & MD for DP World’s UAE region said that "With the rapid expansion of our terminal at Jebel Ali in particular, P&O Maritime Services will play a vital part in the support we provide our customers from before their vessels arrive in port to beyond the terminal gates. P&O Maritime Services brings significant efficiency and service level gains to our operations and with its global experience, P&O Maritime Services will make a valuable contribution to our important UAE facilities."

Mr Andrew King MD of P&O Maritime Services said that "We are delighted to have the opportunity to support DP World and its customers in the UAE. We have been in operation since the 1960’s and this partnership is in line with our on-going strategy of pursuing profitable expansion opportunities in high growth markets. As DP World expands at Jebel Ali and throughout the Middle East region, we expect to grow with it."

P&O Maritime Services is a specialist vessel fleet manager, owner and operator, supporting governments and the private sector in markets globally, from Ireland to the Southern Ocean. In Dubai, P&O Maritime Services will provide crewing and maintenance of more than 20 vessels including tug boats, pilot boats and line boats, along with other maritime operations in the UAE region, both in harbor and offshore.

Saudi Arabian unilateral output boost wrong – Iran

Mr Mohammad Ali Khatibi Iran's OPEC governor said that any unilateral output increase by Saudi Arabia would be wrong. He said that "If Saudi Arabia acts to increase its output unilaterally it is a wrong thing. Any output increase should be ratified in OPEC's ministerial meeting."

The comments follow earlier statements by Iranian President Mr Mahmoud Ahmadinejad that the oil market is plentifully supplied and the rally to record high prices is fake and imposed.

Mr Ahmadinejad said that "At a time when the growth of consumption is lower than the growth of production and the market is full of oil, prices are rising and this trend is completely fake and imposed. It is very clear that visible and invisible hands are controlling prices in a fake way with political and economic aims,' he said when opening a meeting of the OPEC Fund for International Development in the central city of Isfahan."

Mr Ahmadinejad said that "As you know the decrease in the dollar's value and the increase in energy prices are two sides of the same coin which are being introduced as factors behind the recent instability."

Iran has repeatedly said that the market is well supplied and blames rising prices on speculation.

ADCCI proposes mega bank to fund manufacturing projects

Abu Dhabi Chamber of Commerce & Industry said that UAE needs to create a mega fund or bank to provide long term loans for manufacturing projects to encourage investment in the sector and support an ongoing drive to diversify the oil reliant economy.

Mr Salah Al Shamsi chairman of ADCCI said that although the UAE has made substantial progress in its industrialization drive, more efforts are needed to expand this sector, which constitutes the backbone of the diversification program. He added that "Despite such progress, we believe there are other basic issues that should be considered to ensure the creation of an advanced industrial base with the participation of the private sector."

Mr Al Shamsi said that "One of the most significant elements for a successful industry is the need to create a fund or bank with a large capital to finance manufacturing projects by extending long term loans with competitive interest rates and a repay period that conforms to the nature of industrial investment, which requires a long period of time to show returns." He added that such an institution, which should be in co operation with the private sector, would allow investors to shun costly bank loans that usually have difficult terms and are not compatible with industrial investment.

Mr Al Shamsi said that "Unfortunately, we are forced to buy cement, iron and other raw materials and equipment from abroad at high prices. If we established these industries here, we will generate big profits."

Meanwhile, Mr Mohammed Omar Abdullah undersecretary of Abu Dhabi Department of Planning & Economy said that industrial investment in Abu Dhabi Emirate jumped by around 29% to USD 12 billion to push the sector's contribution to the gross domestic product to a record nearly 10% in 2007. He added that "The manufacturing sector in Abu Dhabi is steadily growing and will continue to grow in the coming period. Its value added swelled by more than 20% in 2007."

Saudi announced USD 1 billion energy initiative for poor countries

Arab News reported that King Abdullah of Saudi Arabia has announced a USD 1 billion energy initiative for poor countries and Saudi Arabia’s decision to allocate USD 500 million in soft loans to help developing countries carry out energy and other projects.

Opening a conference of oil producers and consumers at the Jeddah Hilton, Mr Abdullah blamed speculators, high fuel taxes and increased consumption by developing economies for soaring oil prices. He added that "We are ready to meet additional energy requirements of world markets in the future."

He also urged developed nations and OPEC to join the Kingdom in an effort to soften the effects of soaring prices on the world’s poor.

Mr Abdullah said that "The Kingdom’s oil policy since the establishment of OPEC has been based on adopting a fair price for petroleum in a manner that does not harm either producers or consumers. We have been keen on preserving the interests of the entire world as we are keen on preserving our national interests, and because of that policy we have faced many attacks and we have endured some harm because of that."

He also called on OPEC’s Ministerial Council to commit USD 1 billion to a parallel initiative and he pledged Saudi Arabia’s unflagging support for both efforts. He also took immediate action on behalf of the Kingdom.

Saudi ready to pump more oil

Mr Ali Al Naimi Saudi minister of petroleum & mineral resources said that Saudi Arabia may increase its oil production beyond a planned 200,000 barrel a day increase in July 2008 if the oil market requires extra supplies.

Mr Al Naimi said that "I would like to state that for the remainder of this year Saudi Arabia is prepared and willing to produce additional barrels of crude oil above and beyond the 9.7 million barrels per day which we plan to produce during the month of July, if demand for such quantities materializes and our customers tell us they are needed." He added that the Kingdom’s capacity will be 12.5 million barrels a day by the end of 2009 and may rise to 15 million after that if necessary.

He said that Saudi Arabia has identified a series of future crude oil mega increments totaling another two and a half million barrels per day of capacity that could be built if and when crude oil demand levels warrant their development. He added that "Among these prospective programs are a 900,000 barrel per day increment in Zuluf, a 700,000 barrel per day increment in Safaniyah, 300,000 barrel per day increment in Berri, 300,000 barrel per day increment in Khurais and a 250,000 barrel per day increment Shaybah."

Emaar EC signs agreement with City Cool for cooling system

It is reported that Emaar Economic City has signed an agreement with City Cool Company to own, build and operate 2 cooling stations to meet the cooling requirements of the residential and commercial buildings within Bay La Sun Village.

Mr Fahd Al Rasheed CEO & board member of Emaar EC has signed the contract with Mr Ibrahim Al Rajhi chairman of City Cool Company. With an investment of SAR 650 million, the agreement covers the setting up of 2 cooling stations, managing the operations for 25 years, building all the cooling supply network and heating switch machines, and overseeing the billing system.

Mr Al Rajhi said that "We are delighted to be awarded the District Cooling contract to be implemented as a build own operate system for the prestigious Bay La Sun development. With our technical expertise in providing District Cooling solutions, we are confident that we can design and deliver a state of the art system to meet the requirements of this turnkey project, while ensuring that it has the best life cycle value."

Mr Al Rasheed said that "The first and fully integrated community in KAEC, Bay La Sun Village is setting new trends in adopting advanced construction standards. Emaar EC is bringing in the newest systems that complement the overall development plan of KAEC to be the region’s first Smart City. Our contract with City Cool Company, which has proven competencies in developing and managing advanced cooling systems, reiterates our commitment to create modern lifestyles."

Mr Akram Jawah CEO of Emaar EC said that "As per the agreement, City Cool System will roll out one of the most advanced and environmental friendly cooling systems that will cut electricity consumption by up to 40% and reduce the load on the electricity network during the peak hours. Energy management is one of the priorities of modern buildings and the advanced cooling system to be employed at Bay la Sun Village highlights Emaar EC’s commitment to sustainable development practices."

KAEC is the single largest private sector led project in the region to be spread over 168 million square meters on the Red Sea coast and has 6 key components namely the Sea Port, Industrial Zone, Central Business District, Resort District, Educational Zone and Residential Communities. Work is progressing according to schedule on the various zones that have been launched to overwhelming investor response.

Saudi Aramco inks 62.5:37.5 JV pack with Total

Saudi Aramco and Total has signed the shareholders agreement and other core agreements for the establishment of their JV, the Jubail Refining and Petrochemical Company. The signing of these agreements in Jeddah by Mr Abdallah S Jum’ah president & CEO of Saudi Aramco and Mr Christophe de Margerie CEO of Total marks an important step for the planned construction of this 400,000 barrel per day world class, full conversion refinery in Jubail.

Mr Jum’ah said that "The Jubail refinery reflects the leadership of Saudi Aramco and Total in our strategic alliance to address the existing mismatch between refinery infrastructure and types of crude oil on the market, and the resulting tightness in the refining sector. It also demonstrates our commitment to increase capacity to meet various global markets’ needs for refined products."

Mr de Margerie said that "The Jubail refinery project is a brilliant example of a strong strategic partnership with a major oil producing country. Together, Saudi Aramco and Total will contribute to supply growing demand for transportation fuels and petrochemicals, especially in Asia and the Middle East, but also in Europe where the demand for diesel and jet fuels continues to grow."

Following the signing of the agreements, the Jubail Refining and Petrochemical Company will be formed during the third quarter of 2008. Saudi Aramco will initially own 62.5% of the company and Total will own the remaining 37.5%. Subject to required regulatory approvals, the parties are planning to offer 25% of the company to the Saudi public while the two founding shareholders each intend to retain a 37.5% ownership interest. Saudi Aramco and Total will share the marketing of the refinery’s products.

The refinery will benefit from its proximity to the Arabian Heavy crude supply system and from the excellent facilities of the Jubail Industrial City such as King Fahad Industrial Port, power and water grids, and residential areas.

GCC to invest USD 200 billion in energy projects – Gulf Bank

According to the latest report on world growth issued by Gulf International Bank, GCC countries are to invest between USD 160 billion and USD 200 billion in 14 to 20 energy projects.

The report said that the growth of the 6 GCC countries is expected to remain within the world growth rate, due to the USD 132 billion current account surplus and that they have already started playing an increasingly major role as exporters of capital for emerging countries estimated at USD 30 billion, with more cash to be pumped into the region from the GCC countries.

According to the bank's report, recent reports on the solar energy industry found that solar energy accounts for only one per cent of the world's energy resources, today, while the rise of energy prices to record highs, coupled with the lack of signs of stability, seems certain to increase investment in this sector by approximately 50% within 2 years. It added that the move towards sustainable and renewable energy sources is gaining momentum in GCC countries and throughout the world, as countries try to secure alternative energy resources to fuel other related projects, such as building water desalination plants and supplying power to developing areas.

Dr Abdullah Al Amiri chairman of the Emirates Energy Award said that "The US mortgage market woes did not spread to the GCC markets, while the fuel prices are still soaring on the global markets. The high amount of liquidity injected into the region will secure the market against any slump. The foreign reserves available in the market, estimated at USD 455 billion in 2008, up from USD 365 billion in 2007, will further defend the market against any fall."

The report also indicated that GCC countries can safely invest in the energy sector as there is an increasing global trend to raise investment to cover the USD 40 billion required in the petrochemical sector by 2010. GCC petrochemical production contributed seven per cent to the world's total production.

No shortage of oil supplies – Mr Al Attiyah

Mr Abdullah bin Hamad Al Attiyah Qatar’s deputy premier and minister of energy & industry said that the world oil market is well supplied and there is no need to raise output.

Mr Al Attiyah said that "As producers, we affirm that there is no shortage of supplies and sometimes production exceeds consumption. The question is the world facing a supply crisis and the answer is no. I think so far the supply is very efficient. We have a lot of customers that we checked with them and they believe that they are not in a position to buy more oil."

Mr Al Attiyah said that producer countries alone could not control the market and high oil prices and urged Europe to cut energy taxes. He added that "Producers cannot control the oil market and high oil prices, which are driven by speculation, geopolitical factors and other. Europe should cut energy taxes."

Takamul Investment forms 70:30 JV with Future Metals

Oman Daily reported that a 70:30 JV agreement involving Takamul Investment and Future Metals Private Limited promises to boost the growth of Oman's nascent aluminum downstream processing industry.

The agreement covers the establishment of an aluminum rod extrusion plant at the Sohar Industrial Estate using hot metal from Sohar Aluminum's newly operational USD 2.4 billion smelter.

Oman is also developing a downstream aluminum park within Sohar, which is earmarked exclusively for projects that will utilize hot metal from the giant smelter. Sohar Aluminium has pledged up to 60% of its total liquid metal output of its 350,000 tonnes a year for downstream industries.

Aluminium based downstream projects in Sohar are expected to generate around 1,000 direct jobs, as well as create business opportunities for local entrepreneurs, according to Takamul Investment, which partners a majority of the downstream ventures.

Iran and Korea to develop South Pars gas fields – Report

IRNA reported that a contract was signed on commissioning phases 9 and 10 of South Pars Gas Field between South Pars Gas Complex Company and South Korean Company GS.

Upon the contract, the Korean company will participate in pre commission and commissioning operation in the 9 and 10 phases.

Mr Homayoun Shokouh Saremi MD of South Pars Gas Complex Company expressed hope that upon cooperation, the produced gas from the phases can enter into the consumption market this winter.

NISOC to boost Azadegan oilfield output to 170,000 bpd

Mehr News Agency reported that National Iranian Oil Company board of directors has approved the plan to raise Azadegan oilfield’s daily production from 20,000 barrels to 170,000 barrels.

Mr Gholam Reza Hassan Beiglou MD of National Iranian South Oil Company said that "First phase of Azadegan oil field’s early production plan has been completed and at present the field’s average production capacity is about 15,000 to 20,000 barrels per day. Oil exploitation from 6 wells, repairing the equipment, completion of the wells, laying pipelines to the length of 190 kilometers and installing two oil and gas separators are among the plan’s technical operations."

Azadegan oil field is one of the NIOC recent discoveries and constitutes one of the biggest oil fields discovered in the world in the past thirty years. The field holds 33.2 billion barrels of oil in place and 5.2 billion barrels of recoverable reserves. The first exploration well was drilled at the field in 1976, but its discovery was finalized after drilling the second well in 1999.

The field has an approximate area of 900 square kilometers. Sarvak, Kazhdomi, Godvan, and Fahilan are productive layers of the field. Crude oil produced by Fahilan layer is light while other layers yield heavy crude.

Riyadh awards 900 kilometers long fence deal along Iraqi border

MEED reported that a JV of Al Rashid Trading & Contracting Company and the European Aeronautic Defense & Space Company has won the SAR 3.4 billion contract to build a 900 kilometers long security fence along Saudi Arabia's northern border with Iraq. The JV received a letter of intent in mid June 2008 from the interior ministry and expects to sign the contract in July 2008, with site mobilization due imminently.

The contract covers two packages of work that the ministry had considered offering as 2 separate contracts. It had asked firms to bid for the separate packages. The first package covers the 900 kilometers, double lined fence and includes surveillance equipment, watch towers and electronic gates. Package two covers the civil works, including command centers, training centers and accommodation for border guards.

The original bids were submitted in October 2007, with the expectation that a contract would be awarded by the end of the year. However, the decision was delayed by the proposal to split the contract because of the rising cost of raw materials, which has increased the level of risk for bidders. The delay was also due to Riyadh seeking to standardize the systems it uses across a wider proposed network.

The northern border fence forms part of a multi billion dollar project by the interior ministry to install a radar based system for detecting incursions along the entire length of the kingdom's 6,500 kilometer border.

Other firms that bid for the northern border fence contract include the local Al Arab Contracting Company and the local Al Mabani with the US' Raytheon. El-Seif formed a consortium with the US' DRS technologies for its bid.

Nakheel increases height of Tall Tower to 1.4 kilometers

MEED reported that Nakheel is finalizing plans for the world's tallest tower in Dubai. The scheme involves constructing a 1.4 kilometers tall tower next to the Ibn Battuta Mall in the Jebel Ali area.

The Tall Tower project had involved plans for a 1,050 meter tall building, but it is understood these designs have now been revised upwards to make it the tallest skyscraper in the world. At 1.4 kilometers, it is almost double the height of Emaar's Burj Dubai, which is expected to reach about 815 meters and several hundred meters taller than rival towers in Kuwait and Saudi Arabia.

A spokesman for Nakheel confirms designs for the tower are being finalized and says a launch is expected this year.

Earlier designs for the project showed a building with 228 floors, a four level basement and one service sub level, a total built up area of 1.49 million square meters with 492,000 square meters of useable space.

The tower will house offices, apartments and hotels. In the original 1,050 meter design, the highest habitable floor was at 850 meters, topped by a 200 meter central spire with a three level function area and three service floors.

Work has started on changing the layout of the mall ahead of the proposed expansion, which will double its existing retail area to 250,000 square meters by building retail space over existing parking areas between the mall and the metro. The expansion will also include entertainment attractions and a roller-coaster on top of the mall.

The project is just one of several skyscraper projects under development in the Gulf that could claim the title of the world's tallest building.

Aramco orders 10 ships to boost offshore activities

MEED reported that Saudi Aramco has ordered 10 new tug, supply and safety ships to assist with its offshore operations. The contract to deliver the vessels has been awarded to Zamil Operations & Maintenance Company.

As well as enhancing Aramco's offshore capabilities, the Industrial Services Organization which placed the order for Aramco, is also keen to boost the kingdom's industrial manufacturing capability with the deal. The ISO has also revealed plans to establish a maritime academy in Dammam, training locals to develop a new workforce qualified to work at sea.

Four of the ships are to be built by Saudi shipbuilders at King Abdulaziz Port in Dammam.

SABIC and Sinopec to form 50:50 petrochemical JV in China

Reuters reported that Saudi Basic Industries Corporation and China's Sinopec Corporation will spend USD 2.5 billion on an expanded petrochemicals project in northern China. The original plan for the 50:50 JV had given its cost as USD 1.7 billion.

The project's cracker capacity was planned at 1.2 million tonnes of ethylene a year, larger than the figure of 1 million tonnes given in January 2008. The project would also be expanded to include polycarbonate among its downstream plastics slate.

A pact for the project in north China's Tianjin was also signed during Chinese VP Mr Xi Jinping's visit to Saudi Arabia over the weekend. The agreement, which follows a deal announced in January 2008, also called for cooperation in future projects in China and joint works in engineering services and product marketing. The Tianjin plant will produce 4 million tonnes of petrochemical products including the 1.2 million tonnes of ethylene.

SABIC officials said that "SABIC plans to set up a manufacturing center in China to boost its presence in Asia where China represents the biggest market in the Asian continent."

Sinopec has started building the complex in the port city near Beijing. It is also expanding a refinery to 240,000 barrels per day at the same site, which industry executives said SABIC will not be involved in.

US ITC votes for AD and CVD on pipes from China

The United States International Trade Commission determined that US industry is materially injured by reason of imports of circular welded carbon quality steel pipe from China that the US Department of Commerce has determined are subsidized and sold in the United States at less than fair value.

As a result of the Commission's affirmative determinations, the Department of Commerce will issue countervailing duty and antidumping duty orders on imports of this product from China.

The Commerce Department previously made affirmative critical circumstances determinations with regard to imports of this product from China. Therefore, the Commissioners who made an affirmative injury determination today are required to determine whether these imports are likely to undermine seriously the remedial effect of the antidumping duty and countervailing duty orders Commerce will issue.

All five participating Commissioners made negative findings with regard to critical circumstances in these investigations. As a result, the countervailing duty order concerning these imports will not apply to goods that entered the United States from China prior to November 13th 2007, and the antidumping duty order concerning these imports will not apply to goods that entered the United States from China prior to January 15th 2008, the dates of the Department of Commerce's affirmative preliminary determinations.

The Commission's public report Circular Welded Carbon Quality Steel Pipe from China will contain the views of the Commission and information developed during the investigations.

The product covered by these investigations is circular welded carbon-quality steel pipe with an outside diameter of between 0.372 and 16 inches. The product is used to convey gas or liquid at low temperature and pressure or in structural work. It is generally known as standard pipe or structural pipe and is primarily made to the specifications of the American Society for Testing and Materials. The subject merchandise is provided for in subheadings 7306.19.10, 7306.19.51 7306.30.10, 7306.30.50, 7306.50.10, and 7306.50.50 of the Harmonized Tariff Schedule of the United States.

Status of Proceedings
1. Types of investigations: Final antidumping and countervailing duty.
2. Petitioners: Allied Tube & Conduit, IPSCO Tubulars Inc, Northwest Pipe Co, Sharon Tube Co, Western Tube & Conduit Corp, Wheatland Tube Co, Collingswood and the United Steelworkers
3. Investigations instituted by USITC: June 7th 2007
4. USITC hearing: May 13th 2008
5. USITC vote: June 20th 2008
6. USITC notification of Department of Commerce: July 15th 2008

U.S. Industry
1. Number of US producers: 21
2. Location of producers' plants: Alabama, Arizona, Arkansas, California, Illinois, Iowa, Kansas, Louisiana, Missouri, Pennsylvania, Ohio, Oregon, Tennessee, Texas and Wisconsin
3. Employment of production and related workers in 2007: 2,450
4. U.S. producers' shipments (excluding exports) in 2007: 1.4 million short tons valued at USD 1.4 billion
5. U.S. apparent consumption in 2007: 2.6 million short tons valued at USD 2.2 billion.
6. Ratio of quantity of imports from China to U.S. apparent consumption in 2007: By quantity – 29% and by value - 21.5%

U.S. Imports in 2007
1. Quantity of subject imports: 748,181 short tons
2. Value of subject imports: USD 471 million

Chinese rebar and wire rod export prices slow down

It is reported that construction steel prices have witnessed downward adjustment since early May.

The slower growth in world economy growth, sub prime debt influence, escalating inflation, financial turmoil in Vietnam and Chinese central bank's efforts to reduce bank credit have cast adverse effect on steel market. Nevertheless, Chinese construction steel prices are going to move up again following the dull period.

The heavy rain in South China led to flood and the catastrophe has brought a great loss of CNY 26 billion till now. To make things worse, such situation is expected to sustain for at least another two to three weeks. There will be less demand in flood hit area and prices start to drop.

Another factor that affects the market is the situation in Beijing. All projects are ordered to stop before the opening of Olympic Games. Thus, there is not much time for traders to work off the inventory. As a result, people try their best to speed up sales and steel makers deliver more cargo to other markets. Such selling pressure finally drags down the prices. If calculating on theoretical basis, rebar price in Beijing is lower than that in Shanghai at moment.

Market prices probably would see further downward correction as a result of above mentioned two factors. However, construction steel prices probably would resume increase following the short term adjustment due to following facts.

1. Robust demand and short supply. Though Beijing is making efforts to cut bank credit, M2 has reached 43.62 trillion as of end May up by 18.07% YoY and an increase of 1.33% and 1.13% from late 2007 and late last month respectively. In addition, total new added bank credit reached CNY 2.12 trillion for January to May period up by CNY 2.73 billion YoY.

Besides, Chinese fix asset investment totaled RMB4 trillion for the first five moths up by 25.6% YoY which compares with growth of 24.5% and 25.8% in 2006 and 2007. It is clear that investment is stable and it would continue to bolster the demand for construction steel.

By comparison, construction steel output does not see great increase. Total rebar output for January to May period is 39.21 million tonne and that for rebar is 33.13 million tonne down by 1.2% and up 6.9% respectively. The remarkable increase in demand and small growth in production is a solid support for strength of steel price. The production is expected to grow slowly due to output cut in North China and increasing cost.

2. Production cost remains at high level and there is no sign of softening in the near future. India has just levied 15% for iron ore exports and it is set to shot up price further. The monsoon in India also makes exploration and transportation quite difficult and shot up the related cost. At the same time, Chinese steel makers have to face the electricity shortage in summer and possible another increase in price. Thus it is not easy to lower the production cost in a short period.

3. Higher international market price. The high production cost is also harassing overseas steel makers. Coking price in much higher in many other foreign countries and supply is quite tight. The situation is not easy to alter since China limits exports of coal and coke. In the long term, USD is still in a downward trend and oil prices are anticipated to hover at high level which would further shoot up inflation in the world. Hence, there would not be remarkable decrease in steel prices on international market.

According to the report to sum up, there is little likelihood that Chinese construction steel price would see substantial drop. On the contrary, it is expected to move up again in the near future.

(Sourced from Mysteel.net)

New service to keep you updated with steel prices on daily basis

A steel user, however big or small, is always concerned about steel buying as it is normally a big ticket item, but there is no bench mark available to steel buyers to compare their transaction prices, which in a big way decided their bottom line. Lastly, steel has been very volatile in last 6 months and has effected many users in a very severe way making it all the more important to track the prices and trends.

In order to provide such information 3 web sites have been launched
1. www.steelprices-india.com
2. www.steelprices-china.com
3. www.steelprices-middleeast.com
These portals provide domestic pricing information for benchmark steel products in each category at select location in India, China and Middle East on a regular basis 5 days a week. Benchmark products at select locations cover the entire basket of garden variety of steel products including input material for steel making and processing.

In addition, FOB levels for commonly exported steel products from two of the major exporting nation Ukraine & Russia and China are also available to give a sense of alternates.

The prices are displayed on daily, weekly and monthly basis. They also have search facilities to access old data from the archives. Graphical representation of trends and comparison of price movement 2 or more products is also available. A calculator to convert domestic prices into comparative CNF and vice versa is also provided, which takes into account all duties and expenses. In addition, you can monitor currency exchange rates, metal prices, BDI for the day as well as access their archives for past data. Other features include converters for weight, length etc, glossary and advanced search functions. The benchmark product price information is supplemented by global pricing news.

This would assist persons, including steel makers, traders, users and others, who are connected with industry in some way to asses the steel pricing trends and utilize in their day to day working to take considered decisions.

Mr N Sharma of SteelGuru.com said that “We have been receiving requests from Steel Trade Today subscribers for domestic steel prices during the last 3 years of SteelGuru’s operations. The volatility in the steel market in last 6 months to 8 months also propelled us to put it up quickly.”

All these features are accessible only to registered user who is provided with a login id and password after payment is received. To know more about the service, please logon to the web site and click on “Features” Subscription” and “Registration”.

These portals are developed and run by none other that www.steelguru.com, which has become the largest English based steel portal in the world, with more than 1 million page hits per month in just 3 years of operations.

Chinese HRC export prices further increase

It is reported that export offers for Chinese hot rolled steel coil have been further raised again despite dull domestic market. As a matter of fact, there have been transactions at the updated levels.

Domestic HRC prices have been softening. On Shanghai market, price for commercial 4.75mm to 12mm HRC in 1500mm width was is at CNY 5700 per tonne to CNY 5730 per tonne down by CNY 120 per tonne to CNY 130 per tonne. That for 1800mm wide material was down slightly to CNY 6180 per tonne. Q235 2.75mm HRC drop to CNY 6030 per tonne.

Export offers for commercial 4.75mm to 12mm HRC by tier two steel producers are prevailing at USD 1030 per tonne to USD 1040 per tonne FOB this week up by USD 10 per tonne to USD 20 per tonne from last week. There is an extra of USD 10 per tonne for S235JR and another USD 20 per tonne to USD 30 per tonne for those with requirement of silicon content under 0.03%. By comparison, those by tier one steel makers are at USD 1070 per tonne to USD 1100 per tonne FOB for commodity grade 3.0mm up. Some traders mentioned that there has been conclusion at USD 1070 per tonne to USD 1080 per tonne FOB.

Lots of traders are still taking wait and see attitude since they are not confident whether such high price would sustain for a long period. However, some exporters continue to take position at USD 1020 per tonne to USD 1030 per tonne FOB and the delivery is expected to be early August. A certain famous trader is said to be holding position of Chi