June, 05 2008
Indian steel makers to hold price for 3 months - Mr Jindal
Mr Sajjan Jindal former vice CMD of JSW Steel, after taking over as president of Assocham, said that Indian steel makers will honor their commitment to Dr Manmohan Singh to hold prices for 3 months, but rates will go up thereafter.
He said that "Prices have to go up. We have to go into the global price regime. What can you do if raw material prices have gone up?"
Mr Jindal said that there is a big gap between global and Indian prices. He added that "Today for hot rolled coils, the international price is close to USD 1,200 per tonne. In India, we are selling it at USD 850 per tonne."
He said that the raw material prices, both of iron ore and scrap, are going up. Scrap is being imported at USD 800 per tonne, while the selling price is fixed at USD 850 per tonne. He added that "Either that part of the steel industry will close, creating shortages or price has to go up."
Essar plans groundbreaking for Minnesota Steel plant
Essar Group has issued a press release on May 30th 2008 indicating that it plans a ground breaking this summer for the USD 1.65 billion mining, processing and steelmaking Minnesota Steel plant.
Mr Ravi Ruia VC of Essar Group said that "We are committed to moving as quickly as possible to bring steelmaking to the iron range. Minnesota Steel plays a key role in our North American steel strategy."
Essar said that it planned to develop the operation that would produce high quality and low cost steel through ore processing, direct reduced iron production and steel making all on one site. Estimated annual production from the plant is expected to be 2.5 million tonnes of steel product.
Essar indicated it will internally finance the entire USD 1.65 billion price tag including technical, managerial and financial resources. It described itself as a USD 50 billion company with assets in steel, energy, power, communications shipping and logistics and construction. Meanwhile, the project’s public face has changed since Essar’s purchase of Minnesota Steel.
Punj Lloyd acquires 74% stake in Technodyne
BS reported that Punj Lloyd Group has acquired a strategic 74% stake in Technodyne International Limited of UK for an undisclosed amount.
Punj Lloyd, in a statement, said that "This acquisition is a strategic fit and further strengthens Punj Lloyd's existing tankage and terminal business. The acquired capabilities enable it to provide end to end solutions for complete delivery of complex cryogenic, high pressure LNG, LPG, ethylene, ammonia and other similar storage tanks, a significant growth area in oil & gas sector. The capabilities will also be leveraged for design of refinery and petrochemical projects."
Punj Lloyd has been the only company to be involved in all three LNG terminals in Dahej, Dabhol and Hazira in India. It has also completed the cryogenic storage tank package at the Reliance Jamnagar refinery, among other notable tankage projects in South Asia, Asia Pacific and the West Asia successfully in the past.
Technodyne is a specialist engineering, design and consultancy company specializing in large scale cryogenic and high pressure tanks. With projects executed across the world, Technodyne carries out the basic design and detailed engineering for complete steel and steel plus concrete tanks including associated piping, instrumentation and electrical systems.
TATA Steel may shift titanium project from Tamil Nadu
BS reported that TATA Steel is considering the option of shifting its INR 2,500 crore titanium dioxide projects to Andhra Pradesh or Orissa as it has failed to initiate the process of land acquisition in Tamil Nadu even as a year has gone by since the announcement of the project.
Mr S Asokan head of the project said that "We will talk to the Tamil Nadu government first before taking a decision. The mining project, which was announced in June 2007, needs an estimated 10,000 acres of land. However, the state government has failed to help the company in the land acquisition process."
Initially, sections of the local population, particularly those with strong political leanings, accused TATA Steel of attempting to acquire agricultural land for mining. TATA Steel is now facing trouble in acquiring land since small pieces of land aggregating to its needs are scattered among several hundred owners.
Orissa government clears more mega projects
SNS reported that Orissa government’s high level clearance authority, headed by Mr Naveen Patnaik chief minister, has cleared several investment proposals in the state. The proposals for capacity enhancement of capacity from various steel and power companies were also cleared at the meeting
The list includes
1. Essar Steel’s proposal to set up a 6 million tonnes per annum plant and an 8 million tonnes per annum iron ore beneficiation plant. Essar had signed a MoU to set up a 4 million tonnes per annum plant through the sponge iron route. Now, the revised proposal for 6 million tonnes per annum will be through the blast furnace route.
2. Welspun Power & Steel’s proposal to set up a 5 million tonnes per annum iron ore beneficiation plant and a 3 million tonnes per annum pellet plant.
3. 2000 MW thermal plant of Bhushan Energy Limited
4. 1000 MW thermal projects of Monnet Ispat & Energy Limited
5. 1000 MW thermal projects of Visa Power Limited.
6. INR 2200 crore ship building yard & ship repairing project of Apeejay Shipping Limited. The project will come up at the Dhamra Port. Apeejay Shipping had agreed to complete the project within 5 years of acquisition of land.
7. Capacity expansion proposals of SMC Power Generation Ltd, MSP Metaliks and Bhushan Steels were also cleared. The HLCA approved
8. Petrochemicals & petroleum project, one of the five such projects to be developed in India, will be located in Paradip region covering 2 districts of Jagatsinghpur and Kendrapada. Indian Oil Corporation will be the anchor tenant for the project.
CPI calls for all party meet over ArcelorMittal steel plant in Orissa
SNS reported that CPI has demanded an all party meeting to take decision on ArcelorMittal's proposed Greenfield steel mill in the state.
Mr Dibakar Nayak CPI state secretary said that half of the 8,000 acre land identified for its site is arable land. He said that it is necessary to identify suitable land for the mill so that minimum number of people was displaced.
He added that “The government should also avoid using cultivable land for setting up plants.”
ABB wins orders for JSW power plant
It is reported that ABB in India has won orders worth INR 295 crore to provide power solutions for JSW Energy for its upcoming 1200 MW thermal power plant in Ratnagiri in Maharashtra.
The orders are for a range of power solutions including, electrical balance of plant, 400kV gas insulated switchgear substation and generator transformers.
Mr Biplab Majumder country manager & MD of ABB India said that "We are proud of our long standing partnership with the JSW Group. With this order we continue to build on this relationship. ABB’s power products and systems will ensure safe and reliable operation of the plant while optimizing energy consumption of the equipment."
ABB’s solutions for the project comprise several leading edge power technologies for improved system efficiency. The modular environmental business opportunities program solution for 300MW generating units will provide optimized and integrated solutions for complete plant electricals including shunt reactors, bus ducts, control and relay panels, MV and LT switchgear, other auxiliary systems and four 20kV generator circuit breakers, thus providing a further boost towards GCB scheme usages by thermal power plants in India.
The 400kV GIS substation will provide substantial space saving due to its compact design. With all live parts enclosed and protected against negative influences the gas insulated switchgear ensures enhanced operational reliability and safety.
ABB’s scope of delivery also includes 20/420 kV generator transformers. ABB’s transformers are designed and manufactured for high reliability, reduced life cycle costs and optimized electrical design for minimized losses.
L&T outbids BHEL for AP power project
ET reported that Larson & Toubro has outbid BHEL for supply of main power equipment for a proposed 1,600 MW power project in Andhra Pradesh.
As per report, against a bid of about INR 2,000 crore placed by BHEL, L&T bid just over INR 1,500 crore.
The project being developed by Andhra Pradesh Generation Corporation at Krishnapatnam would be the first project in India based on 800 MW supercritical thermal generation sets. The total cost of Krishnapatnam project is about INR 8,000 crore.
Mr Jairam Ramesh union minister of state for power said that "The Krishnapatnam project would be the first contract given to a non BHEL domestic manufacturing company. It is a very significant development that would kick start L&T’s own power equipment manufacturing program. India needs to step up manufacturing to keep pace with its ambitious capacity addition program and an additional domestic manufacturer here would definitely help."
Indian cement sales in May up by 7.9% YoY
According to the Cement Manufacturers’ Association, India’s cement sales in May 2008 have grown up by 7.9% YoY as an increased focus on infrastructure projects has pushed up demand for the building material in India. Cement sales grew to 167.67 million tonne from 155.26 million tonnes in the previous year.
Cement sales of Aditya Birla group rose by 0.8% YoY in May 2008 to 2.66 million tonnes while its production grew up by 2.5% YoY to 2.70 million tonnes. The Birlas’ cement production comes from flagship Grasim Industries and UltraTech Cement, with a combined capacity of more than 31 million tonnes.
ACC said that its January to March 208 quarter sales rose by 7.1% YoY to 5.29 million tonnes. April 2008 production totaled 1.77 million tonnes while sales was 1.74 million tonnes. ACC has the capacity to make 22.4 million tonnes of cement a year.
Shree Cements said that its May 2008 sales grew up by 20.3% YoY to 556,000 tonnes.
JSPL inks MoU with Bihar for thermal power plant
The Telegraph reported that Jindal Power Limited has signed a MoU with the Bihar government for setting up a 2,640 MW coal based power plant. Mr Sushil Maroo director of Jindal Power and Mr Aditya Swaroop energy secretary of Bihar have signed the MoU.
The final site of the project would depend on the availability of coal blocks and water.
JPL commissioned 500 MW of 1,000 MW project in the year 2007-08. The third and fourth units of 250 MW each were likely to be commissioned in June and July 2008 respectively.
It is also in process of setting up 2 power plants in the Dumka and Godda areas of Santhal Pargana where the company had been allotted coal blocks.
Chinese Long Jian to build roads in Himachal Pradesh
BS reported that Chinese firm Long Jian Road & Bridge Limited will build an 80 kilometers long two lane road from Theog to Rohru in the Himachal Pradesh's Shimla district. The project will cost INR 228 crore and to be completed in 3 years. Mr Gulab Singh state PWD minister and Mr Li Guangsheng director of Long Jian Road & Bridge Limited have signed the agreement.
Mr Singh said that "The contract envisaged execution of the work in difficult mountainous terrain and harsh climatic conditions. It involves construction of 15 bridges, 280 culverts and 6.5 kilometers high retaining walls, 5.5 kilometers of covered foot path and 30 rain shelters on the 80 kilometers road."
He said that the widening of the road will benefit fruit and vegetable growers of the fertile Shimla district. He added that "The project will be completed within the specified period of 36 months."
Triveni Engineering inks agreement with TGM Turbinas
Triveni Engineering & Industries Limited recently announced that it has signed an agreement of understanding with TGM Turbinas Industria e Comercio Ltda of Brazil, wherein both parties are un\ertaking to make all their best efforts to conclude a license agreement for the manufacture and sale of impulse and reaction steam turbines of 25 to 45 MW at its Bangalore facility.
Bids for Mumbai Trans Harbor Link to be finalized by mid June
BL reported that Maharashtra government is likely to finalize bids for the INR 6,000 crore, six lane Mumbai Trans Harbor Link between Sewri and Nhava Sheva by mid June 2008.
As per report, Maharashtra State Road Development Corporation, which is a nodal agency for the project, is considering the option of asking the consortium of Reliance Energy and Hyundai to pay a surety of INR 5,000 crore.
The state government is reconsidering the consortium's bid on grounds that it had quoted a concession period that was too low and unrealistic. The consortium had quoted a concession period of 9 years and 11 months and was declared the preferred bidder by the state government in February 2008.
Crompton Greaves acquires Sonomatra in France
BL reported that, in its fourth global acquisition, electrical equipment major Crompton Greaves Limited has bought French power transformers repairing leader Societe Nouvelle de Maintenance Transformateurs for EUR 1.30 million.
Crompton Greaves in a regulatory filing said that the acquisition would help its capabilities in the services segment of its transmission and distribution business. Though Crompton Greaves has been focusing on 3 segments of power systems, industrial systems and consumer products, it is mainly identified with its fans and lighting business.
This is the fourth acquisition for the firm in the international arena. It acquired Belgium based transformer manufacturer Pauwels. Thereafter, it acquired Hungary based Ganz, a leading manufacturer of extra high voltage transformers, gas insulated switchgear and other related components. In 2007, it acquired Ireland based transmission and distribution focused Microsol Holdings Limited and its associate companies.
Sonomatra is engaged in providing on-site maintenance, repair of power transformers, on load tap changers, oil analysis, oil treatment and retrofilling.
IDCO faces law and order problem in Kalinga Nagar project
BS reported that Industrial Infrastructure Development Corporation is facing serious law and order problem in its developmental work at Kalinga Nagar Industrial Complex in Jajpur district of Orissa.
This industrial complex has been developed by IDCO for facilitating the establishment of mega industries in steel and metal sectors. It has taken up special repair work of old military road near village Ravana lying within the KIC. It faced a major problem last week when one of its supervisors Mr Harmohan Nayak was physically assaulted by some unidentified persons.
The incident occurred when Mr Nayak reportedly pointed out about certain specification deficiency in the work to the field staff of the contractors. He was allegedly assaulted by the field staff of the contractor, who has been entrusted with this work. The local divisional head of IDCO has lodged a FIR with the Jakhapura police station.
The same day, Mr PK Panda junior engineer working with IDCO, was abducted from the work site by a group of people belonging to the nearby village while inspecting the water supply work of Gobarghati rehabilitation colony. He was kept in confinement till he was rescued by the officials of IDCO.
The matter was reported to the superintendent of police, Jajpur by the managing director, IDCO for taking necessary remedial measures.
Sunil Hitech receives OHSAS certification
Sunil Hitech Engineers Limited recently announced that it has awarded Occupational Health & Safety Management System certificate by international certification services DNV on May 23rd 2008. As per report, Sunil Hitech Engineers Limited is amongst the very few companies in the power and infrastructural sector which have been awarded prestigious OHSAS certification 18001:2007.
Mr Ratnakar M Gutte CMD of Sunil Hitech Engineers said that "Sunil Hitech Engineers has emerged as an aggressive player in the power sector. Being an OHSAS company, SHEL should strive to reduce accident and injuries to a minimum through collective involvement knowledge sharing and up gradation of all activities."
Mr Sunil R Gutte joint MD of Sunil Hitech Engineers said that "We are committed to protect the employees and those under the influence from Occupational ill health and injuries."
Sunil Hitech is also ISO: 9001-2000 certified company, specializes in the area of civil, mechanical, fabrication, erection, electrical works pertaining to energy, power sector and other infrastructural projects, testing & commissioning of thermal power plants with high precision quality and timeliness. Sunil Hitech Engineers' list of client includes big players like BHEL, NTPC, Reliance Energy, Jindal Steel & Power, TATA and state electricity board Maharashtra, Chhattisgarh, Madhya Pradesh and Tamilnadu. It also undertakes projects in the transmission and distribution segment.
JSEB owes TVNL INR 950 crore
Ranchi Express reported that Jharkhand State Electricity Board owes INR 950 crore to the Tenughat Vidyut Nigam Limited. While hit by fund church Tenughat Vidyut Nigam Limited is holding up payment to Central Coalfields Limited in turn. The consequence may be worse if Central Coalfields Limited stops supply to TNNL demanding its dues that has spiraled up to INR 157 crore.
Mr DK Singh coal advisor of Tenughat Vidyut Nigam Limited said that "We are holding payment to CCL for coal purchase because we lack funds." He added that it is not in position to pay CCL bills till the Jharkhand State Electricity Board made regular payments on TVNL.
The coal consumption of Tenughat Vidyut Nigam Limited is likely to double once the unit starts generation. The unit is expected to start generation from June 12th 2008 after a gap of one year.
Meanwhile, the CCL Board has referred the matters of coal ministry after repeated reminders.
Pre PIB meeting to take up dredging issue of JNPT channel
BL reported that the much delayed plan of deepening the approach channel of the Jawaharlal Nehru Port Trust will be taken up in a pre Public Investment Board meeting this week.
Mr SS Hussain chairman of JNPT said that it plans to dredge the channel and increase the draught from 12.5 meters to 14.5 meters to be able to handle 6,000 TEU vessels.
He added that some of the important projects would include deepening of the approach channel, purchase of new cranes, deepening of the shallow berth and possibly setting up of a fourth container terminal pending for a long time.
JNPT had handled 55 million tonnes of cargo in 2007-08 fiscal as against 44 million tonnes in 2006-07 fiscal. The total container traffic was 51 million tonnes as against 40 million tonnes, dry bulk cargo was recorded at 740,000 tonnes as against 610,000 tonnes, liquid bulk stood at 316,000 tonnes as against 337,000 tonnes and break bulk was 56,000 tonnes as against 14,600 tonnes.
For current financial year, JNPT plans to invest INR 200 crore on its capacity expansion plans. It has earlier announced a CAPEX of INR 7,000 crore to be invested over a period of 5 to 6 years on its 32 ongoing projects which would enable it to handle more capacity of cargo and bigger ships.
Cochin Shipyard launches 5 platform supply vessels
BL reported that Cochin Shipyard Limited created history on June 2nd 2008 by simultaneously launching 5 platform supply vessels for different owners. The ships launched were the 7th in a series of 8 ships under construction for Deep Sea Supply of Norway.
The platform supply ships, which were launched on June 2nd 2008, are of the popular UT-755 L design for the offshore industry. The vessel is designed for satisfying the specific demands for transport of deck cargo, pipes, liquid cargo and cement or barite among others, and unloading to rigs, production platforms and pipe laying barges among others. They are the workhorse of the offshore oil field industry which acts as a lifeline carrying operational supplies and stores to far off installations.
The ship is built and classified under the most stringent rules and regulations of Det Norske Veritas and is classed for unmanned engine room and dynamic positioning. The vessel also satisfies ‘CLEAN’ notation of DNV, which signifies high standards of environmental safety.
NLC contract workers begin indefinite strike
It is reported that about 13,000 contract workers of Neyveli Lignite Corporation has began an indefinite strike to press their charter of demands including regularization of services.
Their other demands include provision of housing, medical and transport allowances and bonus.
Mr Kuppuswamy president of All India Trade Union Congress said that the strike would continue till the demands are implemented.
It may be noted that, on March 29th 2008, contract workers went on indefinite strike but following intervention of Mr Arcot Veeraswamy Tamil Nadu power minister, the strike was called off after 12 days.
Meanwhile, workers said that despite the minister's assurance, their demands have not been implemented. Hence they decided to go on indefinite strike.
Kesoram Industries suspends work in WB unit
BL reported that Kesoram Industries Limited has suspended work in Kesoram Spun Pipes & Foundries section of the company due to day to day low production, quality problems and high rejection leading to serious financial crisis.
Urjankur Nidhi invites EoIs for bagasse co generation projects
Urjankur Nidhi Trust is inviting expression of interest from offshore and mining contractors for bagasse based co generation projects on build own and transfer basis.
These projects, with a capacity of 15 to 45 MW each, will be implemented through special purpose vehicles. The power will be generated using multiple fuels that will include bagasse, cane trash, agro waste and coal. The steam generation parameters will be 110 kilogram per square centimeter pressure and 540 degree C temperature.
GAIL to take up distribution projects in 17 cities
GAIL (India) Limited has recently floated a 100% subsidiary called GAIL Gas Limited to take up city gas distribution projects in 17 cities in the first phase. It has identified 230 cities for city gas distribution projects in phased manner.
The city gas distribution in the first phase will be taken up through its subsidiary company, in authorization from Petroleum & Natural Gas Regulatory Board. The subsidiary company has already been registered with an initial equity of INR 200 crore. Corresponding to this equity amount, debt shall be arranged amounting to INR 300 crore.
GAIL Gas will also take up the compressed natural gas corridor project, which involves an estimated capital outlay of INR 35 crore for setting up CNG stations along the highways.
Zoom Developers moves to HC in Vizhinjam bidding matter
Exim News Service reported that Mumbai based Zoom Developers is reported to have moved the Kerala High Court against the state government’s decision to disqualify its consortium from bidding for building the international container transshipment terminal at Vizhinjam. The Court is expected to take a decision on the issue next week.
An official of Zoom Developers said that "There was a mistake on the part of those who did valuation of the bidding documents. They did not interpret the agreement properly because of which we were disqualified from bidding. For the project bidding, Zoom Developers has joined hands with Portia Management Services and the UK’s Peter Fraenkael and Partners."
He added that Zoom made a representation to the government and along with it went to the court seeking removal of the disqualification.
According to a Zoom Developers statement, the disqualification was not good for the image of our company and we wanted to remove the stigma attached to it.
However, an official of the Vizhinjam International Seaport Limited said that the committee entrusted with the job of scrutinizing the bidding documents found some discrepancies in the bid documents submitted by Zoom Developers and hence the consortium was disqualified from bidding in the second round.
Suzlon inks MoU to strengthen presence in US
It is reported that Suzlon Energy is among 6 others who have signed an agreement with the US government to help the country generate 20% of its electricity using wind power by 2030. The pact may aid Suzlon win more orders for power equipment and improve manufacturing technology.
As per report, US Department of Energy has signed a MoU with GE Energy, Siemens Power Generation, Vestas Wind Systems, Clipper Turbine Works, Suzlon Energy and Gamesa Corporation to improve industrial wind power manufacturing capabilities.
The 6 companies will collaborate to improve the quality of turbine components and to reduce installation and operating costs. Further, the partners, along with the US Department of Energy, will address environmental and technical issues and develop standards for turbine certification and grid connection.
Suzlon has already captured over 8% of the US wind energy market in the recent 2 to 3 years. It has received a supply order of 600 MW in 2 years from Horizon Wind Energy of Texas.
US is the fastest growing wind energy market in the world with 30% annual growth in the last 5 years and with over 25% of the global installed capacity. In 2007, its cumulative wind energy capacity reached 16,818 MW with more than 5,000 MW of wind power capacity added in 2007 at an investment of USD 9 billion. Wind power is the second largest new power generation source in the US now after natural gas.
India becomes 3rd largest importer of Chinese tyres
BS reported that, as Indian tyre manufacturers reel under the high prices of raw materials like natural rubber, crude oil and carbon black, they face a tough challenge from China even as its exports to India climbs multi fold.
According to data provided by Automotive Tyre Manufacturers Association, from 39th rank in 2002-03, India climbed to the 3rd position in 2007. During April 2007 to February 2008 period, Indian imports from China surged almost two fold to 1.2 million units from 660,000 units. The Indian tyre market comprising tyres of cars, UV, OTR, trucks and buses, is worth INR 20,000 crore currently.
Mr Rajiv Bhudhraja director general of ATMA said that "The average price of a pair of Chinese truck tyre is about INR 7,500, which is significantly lower than Indian prices which retail at about INR 13,000 to INR 15,000. More than 100,000 Chinese tyres are imported every month, totaling to about INR 900 crore yearly. More alarming is the fact that people have changed their perspective about products from China, which was once thought to be sub standard."
He added that "China has been able to sell radial tyres at such lower rates to India because of the very low cost of manufacturing in that country and also due to under voicing the imports and selling them without paying VAT here. In addition, China has huge capacities of radial tyres."
The domestic tyre market consists of leading players like MRF followed by Apollo, Bridgestone, CEAT, JK Tyres, Michelin, Goodyear, among others.
Adhunik Metaliks 2007-08 net profit up by 3.85% YoY
Adhunik Metaliks has posted net profit of INR 21.90 crore for the January to March 2008 quarter up by 2.9% YoY as compared to INR 21.58 crore during January to March 2007 quarter. Net sales for the quarter surged by 66% YoY to INR 311.92 crore as compared to INR 188.03 crore.
For year ended March 31st 2008, net profit rose by 3.85% YoY to INR 80.45 crore as against INR 77.47 crore for the year ended March 31st 2007.
In a separate press release, Adhunik Metaliks has informed that its board has approved initial public offer of its 100% subsidiary Orissa Manganese & Minerals. The board of directors has also declared a dividend of 12% for the financial year ended March 31st 2008.
Nalco to invest INR 40,000 crore in expansion projects
Kalinga Times reported that Orissa based National Aluminum Company Limited has drawn up ambitious growth plans involving massive investment of around INR 40,000 crore in next 5 years. The proposed investments would be made in alumina smelter and power projects in Indonesia, South Africa and Iran and Brownfield and Greenfield growth projects within India.
Nalco, which now enjoys more managerial powers and commercial autonomy to chart its own course in the world market, has decided to start its third phase expansion after the completion of the second phase expansion work. The second phase expansion is under implementation at an investment of INR 4092 crore and the same is scheduled to be completed by 2008 end.
Now, plans are afoot for 3rd phase expansion, which is likely to entail expenditure to the tune of INR 6000 crore. Under this expansion, the bauxite mining capacity shall be enhanced to around 90,000 tonnes, alumina refining to 30,000 tonnes, aluminum smelting to 630,000 tonnes and power generation to 1700 MW per annum. The proposed third phase expansion is likely to entail an expenditure to the tune of INR 6000 crore.
Besides, Nalco also has plans to set up at least two new projects in India. A mines and refinery complex is being planned in Andhra Pradesh in which the bauxite mines capacity will be 4.2 million tonnes, while the refinery will have a capacity of 1.4 million tonnes. The draft MoU for the project is under negotiation with the Andhra Pradesh government and the project will involve an investment of INR 7000 crore.
About overseas project, Nalco has already signed a MoU with Indonesia to set up a 500,000 tonne smelter and a 1250 MW captive power plant. It plans to invest around INR 14,000 crore in this Greenfield project. Besides, it is exploring the possibilities of setting up a smelter and power plant in South Africa at an investment of around INR 16,000 crore.
In Iran, a 310,000 tonne smelter has also been planned, in two phases, as a JV with ALPHA. The MoU for the project was signed in March 2008. The project cost will be approximately INR 8000 crore.
3 port projects in Orissa await defense ministry approval
Exim News Service reported that three port projects at Inchudi, Bahabalpur and Chandipur in north Orissa are awaiting a green signal from the union defense ministry.
Mr Jayanarayana Mishra transport & commerce minister of Orissa said that the state government is scouting for ways to avoid the restricted areas while going ahead with the port projects. He added that the state government would study the recommendations made by IIT, Chennai, on how to avoid restricted sites and develop the ports at places earlier identified by it.
The Orissa government is striving to develop about a dozen small ports along its 480 kilometers long coastline. But, it faces hurdles from not only the defense ministry, but also some environmental organizations citing danger to the existence of rare sea creatures.
While the state government has identified at least 13 locations for developing ports, the sites are yet to get clearance from the defense & environment ministries.
Power demand in India to reach 335 GW by 2017 – Report
According to the McKinsey & Company’s Electric Power & Natural Gas Practice study, with soaring crude oil prices, the time has come for the Indian power sector to explore substitutes. If India continues to grow at an average rate of 8% for the next 10 years, power demands may rise from the present 120 GW to 315-335 GW by 2017, 100 GW higher than current estimates.
The study said that India is gradually progressing towards a service led economy from an agrarian economy. Supply and production have increased but demand has doubled. It added that the demand can only be met through a 5 to 10 fold rise in power production. This means investments in the power sector will increase over USD 600 billion in the next 10 years.
Consumer demand across rural and urban sectors is growing at 14% over the next 10 years, whereas India’s GDP growth is just 8% a year. The second reason is the government’s plan to provide electricity to everyone by 2012. This means 23 million below poverty line households should be added in the power grid. The third reason is the 24X7 supply of electricity to consumers and the industrial demand to switch to expensive diesel based power.
When the demand rises to 335 GW, India’s power sector will have to generate 415 to 440 GW for plant availability adjustments and 5% spinning reserves. Adding 300 GW by 2017 will mean increasing the annual capacity by 30 GW against the current growth capacity of 9 GW.
The McKinsey & Company’s report, however, said that India will be able to add only 160-180 GW by 2017 even in case of best development trajectory. If these estimates are to be broken, India needs to increase its capacity at a fast pace.
Jai Corporation appoints Mr Gaurav Jain as new MD
Jai Corporation Limited recently announced that its board has accepted the resignation of Mr Virendra Jain as MD of the company with effect from June 4th 2008 and has appointed Mr Gaurav Jain as new MD with effect from June 4th 2008.
Jai Corporation said that Mr Virendra Jain will continue to remain on the board as a non executive director and has been appointed as VC of the board of directors.
Vedanta to decide on steel JV partner by 2008 end – Report
Bloomberg reported that Vedanta Resources Plc is likely to agree on a JV partner for a 5 million tonne steel plant by the end of 2008 and is talking with European, Japanese and Indian companies.
As per report, it will take 3 years for the first part of the project to be completed once a partner is chosen.
The partner may be given a majority stake in the venture in Orissa and Vedanta will supply the project with iron ore.
Mercator Lines inks USD 320 million contract with TATA Power
Mercator Lines Singapore Limited has announced that it signed a new 4 year contract worth USD 320 million with TATA Power Company, boosting rates to carry coal.
Mercator Lines said that the two companies renegotiated an existing contract. It added that the contract is between June 2008 and May 2012.
SAIL SSP organized free medical camp
It is reported that Steel Authority of India’s Salem Steel Plant, under its corporate social responsibility, had organized a free medical camp at Karumandurai in the Eastern Ghats on June 1st 2008. Dr TN Muralidhara, chief of medical & health services at SSP had inaugurated the camp.
A team of doctors from SSP supported by para medical crew conducted the camp. Medical cards were issued to the patients giving personal details such as name, age, sex, address etc and medical information such as weight, blood sugar level, blood pressure reading, diagnosis of the ailment, treatment given along with medical advice.
A total of 540 patients benefited from the medical camp and a total of 27 patients have been identified for further treatment at SSP’s main hospital free of cost.
Fitch assigns 'AAA (ind)' rating for TATA Steel long term debt
Fitch Ratings has assigned a national rating of 'AAA (ind)' to TATA Steel Limited's long term debt totaling INR 58.5 billion. At the same time Fitch has affirmed TATA Steel's national issuer rating at 'AAA (ind)', its INR 20 billion non convertible debenture program and its INR 9.75 billion short term debt rating at 'F1+(ind)'. The outlook is stable.
US ITC retains AD duty on wire rod except from Canada
The US International Trade Commission determined that revoking the existing countervailing duty order on carbon and certain alloy steel wire rod from Brazil and the existing antidumping duty orders on imports of that product from Brazil, Indonesia, Mexico, Moldova, Trinidad and Tobago and Ukraine would be likely to lead to continuation or recurrence of material injury within a reasonably foreseeable time, but that revoking the existing antidumping duty order on imports of that product from Canada would not.
As a result of the Commission's affirmative determinations, the existing orders on imports of carbon and certain alloy steel wire rod from Brazil, Indonesia, Mexico, Moldova, Trinidad and Tobago and Ukraine will remain in place.
As a result of the Commission's negative determination, the existing order on imports of that product from Canada will be revoked.
The Trade Commission said that “With respect to Brazil, Indonesia, Moldova and Ukraine, all six Commissioners made affirmative determinations. With respect to Trinidad and Tobago vice chairman Shara L Aranoff and Commissioners Charlotte R Lane, Irving A Williamson and Dean A Pinkert voted in the affirmative; Chairman Daniel R Pearson and Commissioner Deanna Tanner Okun voted in the negative. With respect to Mexico, Vice Chairman Aranoff and Commissioners Okun, Lane, Williamson and Pinkert voted in the affirmative; Chairman Pearson voted in the negative. With respect to Canada, Chairman Pearson, Vice Chairman Aranoff and Commissioners Okun and Williamson voted in the negative; Commissioners Lane and Pinkert voted in the affirmative.”
Vale reaffirms plans to build steel mill in Para
BNamericas reported that mining giant Vale is committed to building a new 2.5 million tonne to 5 million tonne per year steel mill in northern Brazil's Pará state regardless of whether it secures a partner.
Mr Roger Agnelli president & CEO of Vale said that the project is still in the feasibility study phase. He added that at the First Brazilian Steel Gathering organized by steel institute IBS in Rio de Janeiro.
Mr Agnelli said that "We are building a plant with or without partners. Northern Brazil also needs steel."
Mr Agnelli also mentioned that Brazil as the best place to produce steel today due to its abundant iron ore mines. Vale is the owner of the Carajas iron ore mine, which churns out some 100 million tonne per year.
Mr Rocca sees slow down in global steel demand
According to Mr Paolo Rocca chairman of Tenaris and vice chairman of the International Iron and Steel Institute, global steel demand will begin to slow in three years because of unsustainable price increases for iron ore and other raw materials.
Mr Rocca said that steel demand will continue to grow at around 6% a year through 2010, before slowing to about 4.5% in 2011 to 2015. He added that prices of iron ore, the main steelmaking ingredient, have quadrupled and coking coal has risen sixfold since 2003.
Mr Rocca said that “No financial system can sustain this inflationary pressure. The world has reached a limit on availability of non renewable resources.''
Japanese steelmakers agree to emission cap talks - Nikkei
Nikkei News paper said that Japan's steel and power industries have agreed to talks with the government on a so called cap and trade system to reduce greenhouse gas emissions.
The paper said that Japan Iron and Steel Federation and the Federation of Electric Power Companies have now agreed to talks with the government on the system.
Under the cap and trade system, companies that produce too much greenhouse gas must buy permits from companies whose emissions are below the limit.
Nikkei reported that steelmakers and utilities have previously opposed introducing the system saying it would hurt investment and reduce Japan's global competitiveness. It said that both groups oppose mandatory emission caps and are asking for more flexible targets.
Sidenor to invest EUR 400 million in Stomana Industry
It is reported that the Greek steel products group Sidenor will pump EUR 400 million over the next five years in its Bulgarian steel making unit Stomana Industry.
Mr Sarados Milios Sidenor board member said that the deployment of the investment will be conditional on the allocation of additional greenhouse emission quotas under the Kyoto Protocol.
The investment plans have been prompted by the creation of a joint venture with Nucor of the US which will provide vast market opportunities for the Greek company.
Stomana Industry, which ships 80% of its output abroad, controls 52% of the domestic market for steel products. In 2007, the company manufactured 800,000 tonnes. The newly opened unit for long products, which cost EUR 80 million, will double the output capacity of the steel maker.
Japanese steelmakers to supply more steel to automakers
JMB reported that Japanese integrated steel makers try to increase the steel supply for automakers.
As per report, Japanese steel makers are studying potential higher output to keep stable supply when automakers are accepting around JPY 28,000 per tonne of price hike for fiscal 2008 started April from previous year.
The supply is estimated to increase by around 200,000 tonnes in April to September 2008.
USW signs pact with ArcelorMittal on health and safety issues
The United Steelworkers announced that it has reached a groundbreaking agreement with ArcelorMittal to improve health and safety standards throughout the company. The global agreement covers ArcelorMittal workers represented by unions throughout the world.
In addition to recognizing the vital role played by unions in improving health and safety conditions, the unprecedented agreement establishes universal minimum standards at every site the company operates. Many safety improvement measures such as plant specific joint management union health and safety committees are standardized, and training and education programs are instituted in order to immediately address current health and safety issues in North America and elsewhere in the company.
The agreement also included the creation of a joint management union, global health and safety committee that will target plants in the group in order to work to dramatically improve their performance.
Mr Leo W Gerard president of USW International said that "This agreement is an obvious signal to companies everywhere that unions are vital to safe and healthy workplaces. It is the most important issue for our members and we are pleased to be able to come to this agreement with the world's number one steel company."
Mr LN Mittal CEO of ArcelorMittal said that "This agreement will build on the work that we have already undertaken in the company. Health and safety is our number one priority and in signing this agreement we hope to set a new benchmark for the industry."
The USW represents 850,000 workers in North America. Approximately 20% of them work in the steel industry.
Sidor hires 890 external workers - Report
BNamericas reported that Venezuelan steelmaker Sidor has added 890 subcontracted employees to its payroll as part of a collective contract agreement reached with the government in May.
Mr José Meléndez secretary of Venezuela's steelworkers union Sutiss told BNamericas that "This is to comply with the specifics of clause 97 of the collective contract which establishes that 1,300 employees must be incorporated within one month.”
He explained that however, the agreement does not call for all of Sidor's external workers to be contracted. Only the ones directly involved in the production process will be integrated.
In May, Sutiss signed the collective contract with Venezuela's government for employees at Sidor where they received a pay raise of VEB 53 per day (USD 24.70), among other improvements.
ArcelorMittal to offer USD 500 million for Kremikovtzi
Trend Capital reported that ArcelorMittal, the world's largest steelmaker plans to present a takeover proposal shortly for an ailing Bulgarian steel plant.
The report cited Mr Volker Schwich vice president for eastern European projects of ArcelorMittal as indicating that the plan to be presented this week to Bulgarian authorities includes a pledge to invest USD 500 million in the debt laden Kremikovtzi plant.
Mr Schwich, in the Bulgarian capital Sofia, said that Kremikovtzi currently runs at one third of capacity and ArcelorMittal would seek to boost production to full capacity.
Japan settles export price of color coated steel
It is reported that Japanese steel manufacturer has made an agreement with overseas end user for color coated sheet exported in July to September and the price was settled at USD 1,200 per tonne.
Now Japan steel manufacturers are negotiating on steel export price in the third quarter covering hot dipped galvanized steel and HGI etc.
In South ease Asia, Japan plans to increase coated sheet export price to Thailand to USD 1,300 per tonne FOB, mainly due to Thailand’s rising domestic price.
(Sourced from YIEH.com)
BlueScope Steel Vietnam names design award winners
VNS reported that two architecture students in HCM City have won first prize in the 2008 BlueScope Steel Vietnam Design Award for their multi function bus station plan.
Mr Vu Ngoc Hai and Mr Nguyen Tan Loc beat 300 other competitors who submitted 200 designs for a bus station at Ben Thanh Market and a traffic toll station.
The duo’s Saigon Combination of Past and Present design features a harmony between modernity and tradition through the use of color plated steel and a plaited structure.
Dr Le Quang Quy deputy rector of the HCM City Architecture University said that "The contest not only promotes ideas and plans but also serves as a bridge between the training work of our university and the reality of the architecture industry.”
The Australian steel company held its first contest last year when 200 students submitted 68 designs.
ArcelorMittal Brazil seeking USD 1,000 per tonne FOB for slabs
SBB reported that ArcelorMittal Tubarão is looking to sell slabs for around USD 1,000 per tonne FOB almost USD 200 per tonne more than the previous known concluded deals two months ago.
US ITC to Institutes investigation on certain auto parts
The US International Trade Commission has voted to institute an investigation of certain automotive parts. The products at issue in this investigation are various parts of the Ford Mustang.
The investigation is based on a complaint filed by Ford Global Technologies, LLC of Dearborn on May 2nd 2008. The complaint alleges violations of section 337 of the Tariff Act of 1930 in the importation into the United States of certain automotive parts that infringe patents owned by Ford GTL. The complainant requests that the ITC issue an exclusion order and a cease and desist order.
The ITC has identified the following as respondents in this investigation:
1. Keystone Automotive Industries, Inc of Pomona
2. LKQ Corporation of Chicago
3. US Autoparts Network, Inc of Carson
4. Jui Li Enterprise Co. of Taiwan
5. YCC. Parts Manufacturing Co Ltd of Taiwan
6. TYC Brother Industrial Co Ltd of Taiwan
7. Taiwan Kai Yih Industrial Co Ltd of Taiwan
8. TYG Products, LP of McKinney
By instituting this investigation, the ITC has not yet made any decision on the merits of the case. The case will be referred to the Honorable Theodore Essex and the ITC will make a final determination in the investigation at the earliest practicable time. Within 45 days after institution of the investigation.
Newell Recycling to build a new shredder in Georgia
Newell Recycling announced that it has been granted final approval and received all necessary permits to build and operate a shredder facility at the Savannah in Georgia area. The facility is expected to be opened by the end of this year.
Newell Recycling of Savannah, LLC is expected to initially employ 75 people in Garden City, with plans for around 100 employees once the plant is fully operational. It said that the Savannah operation, the company’s third shredder plant and eleventh location overall will feature a 6000 horsepower Newell MegaShredder
The company held a grand opening at the 40 acre site the middle of last month. The company has made an initial investment of USD 17 million and has asked for no tax abatements. In keeping with the corporate tradition of environmental responsibility, Newell Recycling is preserving many specimen trees on the site, while planting nearly 100 new trees on the property.
(Sourced from Recycling Today)
Siemens plans to sell 3 part euro bond -Bankers
Reuters reported that German engineering conglomerate Siemens is planning to sell a benchmark three part euro bond.
A banker familiar with the sale said that it would consist of a long 3 year bond, a 6 year bond and a 10 year bond, with pricing expected later on Wednesday.
Deutsche Bank and Goldman Sachs are joint book runners, with BNP Paribas and Royal Bank of Scotland as joint lead managers.
The bond will be issued via Siemens Financieringsmaatschappij NV, guaranteed by Siemens AG.
Doosan Heavy bags major power plant equipment order from Thailand
It is reported that South Korea's Doosan Heavy Industries & Construction Co Ltd has secured an order worth USD 820 million to supply equipment for a coal fired power plant in Thailand.
Doosan Heavy Industries in a filling to stock exchange said that the contract from Thailand's Gheco One Co Ltd a joint venture between French utility Suez's unit and Thai developer Hemaraj will last until October 2011.
The 700 MW power plant is to be located in Thailand's Rayong Province.
Nisshin Steel to join Nippon and JFE on pipe test data fabrication
Reuters reported that Japan's fifth biggest steelmaker Nisshin Steel Co said that it would make an announcement on improper testing for its stainless steel pipes today.
Nippon Steel Corp and JFE Holdings Inc last week confirmed that that they had fabricated strength data on their steel pipes.
Star Bulk acquires Capesize vessel to expand its fleet
Star Bulk Carriers Corp announced that it has entered into a definitive agreement to acquire the Capesize bulk carrier Falcon Cape, of 150,940 DWT built in Japan in 1991 for approximately USD 87.2 million. The acquisition will be financed through a combination of company cash and bank debt. The vessel is to be renamed Star Ypsilon and is scheduled to be delivered to Star Bulk within August/September 2008.
The vessel will enter into an approximately 34 month time charter to TMT as of the time of the vessel's delivery to Star Bulk at a net daily rate of USD 112,600 for the first 10 months, USD 93,300 for the following 12 months and USD 74,100 for last 12 months in replacement of the Star Iota which has been committed to be sold.
The vessel is being acquired from a company affiliated with Oceanbulk, which intervened to facilitate the transaction at the same price it acquired the vessel from Dutch interests. No commissions are to be charged either on the sale or the chartering of Star Ypsilon.
Mr Akis Tsirigakis president & CEO of Star Bulk said that "We are pleased to have made an acquisition with a contracted revenue of approximately USD 93 million exceeding the vessel's purchase price. It is not commonplace to source such deals."
Following this acquisition, Star Bulk's fleet will increase to thirteen vessels of approximately 1,184,835 DWT. With the addition of the Star Ypsilon the contracted fleet operating days under time charter in 2008, 2009 and 2010 will be 100%, 84% and 63% respectively.
Hungarian rail transport volume in Q1 down by 9% YoY
The Hungarian Central Statistical Office reported that Hungary freight forwarders carried 70.10 million tonnes of goods in the first quarter of 2008 down by 2.2% less than in 2007, but their output in terms of freight tones kilometers rose by 1.9% to 12.83 billion in 2007.
The Statistical Office said that rail transport volume dropped by 9% YoY, the road transport volume fell by 1.1% YoY, the waterway transport volume dipped by just 0.1% YoY and pipeline transport volume rose by 1.6% compared to the corresponding period of 2007.
Calculating in freight tones kilometers, rail transport was down by 5.7% YoY, while road transport was up by 4.3% YoY, water transport by 1.9% YoY and pipeline transport by 1.5% YoY.
Linde elects board and chairman in AGM
Linde AG's at the Annual General Meeting the shareholders' representatives were elected in rotation for the new Supervisory Board, which has been reduced in size from 16 to 12 members.
At the constitutive meeting immediately following the Annual General Meeting, the Supervisory Board members confirmed the appointment of Dr Manfred Schneider as Chairman of the Supervisory Board. Dr Schneider has been a member of the Linde AG Supervisory Board from May 29th 2001 and Chairman of the Supervisory Board from May 27th 2003.
Composition of the newly elected Linde AG Supervisory Board for the period of office to 2013
1. Dr Gerhard Beiten
Dr Clemens Börsig
3. Mr Michael Diekmann
4. Mr Matthew FC Miau
5. Mr Klaus-Peter Müller
6. Dr Manfred Schneider
7. Mr Gernot Hahl
8. Mr Thilo Kämmerer
9. Mr Hans-Dieter Katte
10. Mr Jens Riedel
11. Mr Josef Schregle
12. Mr Wilfried Woller
The following members retired from the Linde AG Supervisory Board: Dr Karl-Hermann Baumann, Gerhard Full, Professor Dr Jürgen Strube shareholders' representative, Siegried Friebel and Josef Schuhbeck as employees' representative.
The Linde Group is a world leading gases and engineering company with more than 50,000 employees working in around 100 countries worldwide. In the 2007 financial year it achieved sales of EUR 12.3 billion.
Environmental reports for Rautaruukki's Raahe and Hameenlinna
The 2007 environmental reports for Rautaruukki’s Raahe and Hämeenlinna works have been published in Finnish and English.
The reports include a description of the works, information about their environmental impacts and progress made. The reports also discuss the state of the environment in the proximity of the works and describe safety issues at the works.
The environmental reports can be viewed on the company’s website at www.ruukki.com.
3 workers injured at Cooper Hand Tools plant in Monroe
It is reported that three workers at the Cooper Hand Tools plant in Monroe suffered burns when a piece of equipment caught fire Tuesday morning.
The worst injured worker was taken to Carolinas Medical Center in Charlotte with second degree burns. It said that some 170 employees evacuated the plant where they make tools. The fire started when a furnace apparently malfunctioned.
Mr Ronald Fowler chief of the Monroe Fire Department said that “In this particular situation the furnace contained some molten metal that you can’t put water on that because of the reaction that would have.”
Malaysian builders call for removal of import duty on cement
Bizedge.com reported that Master Builders’ Association of Malaysia while has called for the removal of the 10% levy imposed on imported cement.
Mr Patrick Wong president of Master Builders’ Association of Malaysia said the levy could only mean higher costs for the construction industry. He said that “This 10% tax does not make sense, as it contradicts the Asean Free Trade Area rule, where cement will only be taxed at 5% and 0% come 2010.”
He added that “Portland cement, which is no longer under price control, makes up the bulk of cement used in the local construction industry, hence the removal of the levy would help reduce our costs. This is unlike the liberalization of the steel industry which does cover many categories of steel.”
Malaysian government has recently lifted the ceiling prices for cement.
Sumatec gets contracts from Petronas subsidiary
Bizedge.com reported that Sumatec Resources Bhd subsidiary Sumatec Engienering & Construction Sdn Bhd has secured two contracts totaling MYR 69.98 million from Petronas subsidiary Malaysian Refining Company Sdn Bhd for works related to the Melaka Refinery PSR-2 revamp project.
Sumatec said that the contracts involve the steel structure fabrication and erection and general civil, piling concrete foundation, pavement and other associated works.
Grupo Simec closes the acquisition of Grupo San
Grupo Simec SAB de CV announced the closing of the acquisition of all of the shares representing the capital stock of Corporacion Aceros DM, SA de CV and certain affiliates Grupo San.
The acquisition was announced on February 22nd 2008.
Tenaris elects directors during AGM
Tenaris SA in its annual general shareholders meeting approved the re election of the current members of the board of directors, with the exception of Mr Bruno Marchettini who did not stand for re election and the election of Mr Alberto Valsecchi former COO to serve as members of the board of directors until the next annual shareholders' meeting, which will be held in June 2009.
Tenaris board of directors subsequently confirmed Mr Amadeo Vázquez y Vázquez, Mr Jaime Serra Puche and Mr Roberto Monti as members of the Company's audit committee, with Mr Vázquez y Vázquez to continue as chairman. All three members of the audit committee are independent directors.
Tenaris also re appointed PricewaterhouseCoopers as its independent auditors for the 2008 fiscal year
US weekly crude steel production decrease by 0.3%YoY
American Iron & Steel Industries reported that in the week ending May 31st 2008, US’s raw steel production was 2.114 million net tons while the capability utilization rate was 88.6%. Production was 2.121 million net tons in the week ending May 31st 2007, while the capability utilization then was 88.4%. The current week production represents 0.3% decrease from the same period in 2007.
Production for the week ending May 31st 2008 is down 1.2% from the previous week ending May 24th 2008 when production was 2.140 million net tons and the rate of capability utilization was 89.7%.
Adjusted YTD production through May 31st 2008 was 45.990 million tons at a capability utilization rate of 88.8%. That is a 3.0% increase from the 44.641 million net tons during the same period last year, when the capability utilization rate was 85.1%.
District wise production for the week ending May 31st 2008
1. Northeast Coast: 166
2. Pittsburgh/Youngstown: 214
3. Lake Erie: 85
4. Detroit: 92
5. Indiana/Chicago: 530
6. Midwest: 261
7. Southern: 672
8. Western: 94
(In thousands of net tons)
AISI’s estimate is based on reports from companies representing about 75% of the US’s raw steel capability and includes revisions for previous months
Esmark unable to refinance long term debt
Steel company Esmark Inc said that it has been unable to refinance its debt on a long term basis, raising substantial doubt about its ability to continue as a going concern.
Esmark said that the statement was required by a Nasdaq rule.
It was prompted by Esmark's annual report on Form 10 K filed on May 20, which included an explanatory paragraph from the company's accounting firm.
Last week, Russian metals and mining company OAO Severstal commenced its USD 17 per share tender offer for outstanding common stock of Esmark.
Severstal's bid worth about USD 1.24 billion is backed by the United Steelworkers union, which had threatened to block an earlier offer to buy Esmark from India's Essar Steel Holdings.
BNDES could give Vale a hand in steel plant
BNamericas reported that Brazilian development bank BNDES is interested in partnering with mining group Vale to open a steel slab plant in northern Brazil's Pará state.
Mr Luciano Coutinho president of BNDES said that "It is an interesting undertaking adding that a project of this kind requires at least a USD 5 billion investment.” But the president did not indicate the stake in the project the bank could take on.
Mr Roger Agnelli CEO of Vale said that the company plans to go ahead with the 2.5 million to 5 million tonne per year mill project regardless of whether it secures a partner.
Japanese FTC fines Nippon, JFE and Kubota for price fixing
Reuters reported that Japan's fair trade watchdog slapped Nippon Steel Corp, JFE Steel Corp and Kubota Corp with a fine for price fixing, bringing the industry under fresh scrutiny after admissions of lax product testing.
As per report, the Fair Trade Commission ordered the three to pay JPY 2 billion for fixing product prices, but it exempted Sumitomo Metal Industries Ltd which reported the cartel to the government agency.
The Fair Trade Commission said that the four had agreed to raise prices for steel posts used in engineering works by a certain margin in 2004 and 2005.
The Japanese industry is already in the spotlight due to quality control concerns after Japan's largest steelmakers, Nippon Steel and JFE Steel, a unit of JFE Holdings Inc, said they had failed to carry out some tests on some of their products.
2 workers injured after crane collapses at steel mill in Maryland
Ap reported that two steel mill workers weren't seriously injured after a crane they were working on collapsed during a storm in Maryland.
Lt Pierre Thode with the Baltimore County Fire Department said that the men climbed down a ladder under their own power around 4:45 PM. The crane went down shortly after 4 PM. The men were working to unload materials from a barge.
Mr Thode added that the men weren't pinned down in the crane, but their ladder gave way when it collapsed, leaving them with no way down. A fire truck with a long ladder came to the rescue. The men were not taken to hospitals.
The collapse occurred at the Sparrows Point steel mill, which is owned by Russian steelmaker OAO Severstal
US steel import permit in May decrease by 20%MoM
Based on the Commerce Department’s most recent Steel Import Monitoring and Analysis data, the American Iron and Steel Institute reported that steel import permit applications for the month of May totaled 2,393,000 net tons. This was a 20% decrease from the 2,988,000 permit tons recorded in April 2008 and a 19% decrease from the April preliminary imports total of 2,944,000 net tons.
Import permit tonnage for finished steel in May was 1,916,000 net tons a decrease of 13% from the preliminary imports total of 2,194,000 net tons in April.
For the first five months of 2008 total steel imports were 13,058,000 net tons, down by 12% from the 14,772,000 net tons imported in the first five months of 2007. Total steel imports for 2008 would annualize at 31.3 million net tons or 6% below the 2007 12 month total.
For May 2008, the largest finished steel import permit applications for offshore countries were
1. China 285,000 net tons
2. Korea 184,000 net tons
3. India 123,000 net tons
4. Japan 113,000 net tons
5. Germany 77,000 net tons
Finished steel import permit applications for China increased 58 % in May compared to April preliminary imports and were the highest monthly total for 2008 so far.
Product categories that increased in May vs April preliminary include: 1. Hot Dipped Galvanized Sheet & Strip up by 80%
2. Oil Country Goods up by 26%
3. Heavy Structural Shapes up by 9%
4. Tin Plate up by 37%
Significant products that showed a year to date increase vs. 2007 include:
1. Oil Country Goods up by 18%
2. Line Pipe up by 16%
Mr Andrew G Sharkey III president & CEO of AISI said that “Of particular concern are the sharp increases in monthly imports from China and in galvanized sheet, where imports from China were more than one fourth of total imports of this high value product.”
Mr Busse elected as chairman of AISI
The Board of Directors of the American Iron and Steel Institute have elected Mr Keith E Busse chairman & CEO of Steel Dynamics Inc to a one year term as chairman of the Institute. Mr Busse was sworn in as chairman at the Board’s spring meeting at Scottsdale in Arizona on May 4. He will succeed Mr Ward J Timken Jr.
Mr Brusse in his role as chairman, he will speak out on issues, such as climate change and trade, representing the industry on those and other important public policy issues. He has previously served as vice chairman of AISI and as chairman of the Institute’s Finance Committee.
Mr Busse said that “I am honored to serve as this year’s chairman in what I see as a crossroads year for both our industry and the Institute.” He added that “My vision for this pivotal year is to see us move forward on the high road, achieving new successes in our quest for sustainability, and finding common ground to make our voice a unified voice heard in the halls of Congress louder than ever before.”
Mr Andrew G. Sharkey III president & CEO of AISI said that “I welcome Keith’s leadership and willingness to serve the industry at a time of continuing change in the global steel industry and in America’s political landscape, a major transitional period that will impact the industry. His skills will serve us well in our efforts to speak out with a unified voice on behalf of the North American steel industry.”
Insurance compensation to SSAB confirmed
The Swedish Supreme Court has rejected Zürich's appeal regarding insurance compensation to SSAB. The judgment delivered by Svea Court of Appeal is thereby confirmed.
As earlier announced, on January 25th 2008, Svea Court of Appeal delivered a judgment according to which the insurance company, Zürich Insurance, Sweden Branch was ordered to pay SSAB's wholly owned subsidiary, SSAB Tunnplåt AB additional insurance compensation of approx SEK 161 million as well as interest and compensation for litigation costs relating to a blast furnace breakdown which occurred at the company's plant in Luleå in 1997. Including accrued interest, the awarded compensation totaled approx SEK 302 million, excluding compensation for litigation costs.
The release added that “Zürich Insurance, Sweden Branch has appealed against the judgment to the Swedish Supreme Court, which according to a decision dated June 2nd 2008, rejected the appeal. Consequently, the judgment delivered by Svea Court of Appeal is thereby finally confirmed. In addition to the insurance compensation awarded according to the judgment, approx. SEK 110 million has already been paid out in compensation as a consequence of the breakdown. The final judgment has a positive impact on SSAB's earnings in the amount of approx SEK 260 million.”
ArcelorMittal and Borusan Turkish mill JV cleared by EU
Thomson Financial reported that the European Commission has cleared steel group ArcelorMittal and Turkish peer Borusan's proposed 50:50 JV which will see a USD 500 million investment in the construction of a new hot strip mill at Gemlik in Turkey.
The mill which will be located next to ArcelorMittal and Borusan's jointly operated Borcelik plant on the Marmara Sea coast, is planned to operate in first half of 2010 with a capacity of 4.8 million tonnes.
The transaction was reviewed under the EU's 'simplified' merger review procedure for cases which the commission believes do not pose competition concerns.
Essar eyeing for major investments in Pakistan
It is reported that Essar Group has expressed its keenness to invest in Pakistan's economy, especially in the energy, steel and shipping sectors. The offer was made by Mr Sashi Ruia chairman of Essar Group during a meeting with Mr Yousuf Raza Gilani prime minister of Pakistan, who said Pakistan is open to business and foreign direct investment.
Mr Gilani said that almost all sectors of Pakistan's economy allow FDI, which is fully protected under the country's laws and there is no discrimination between foreign and local investment as no government sanction is required in either case. He added that "Since Pakistan is deficient in electricity, it would welcome investment in power generation, especially in developing the Thar coal reserves."
Mr Ruia told Mr Gilani that Essar group has made investments across the world and would be keen to invest in energy, steel and shipping sectors.
Mr Asif Ali Zardari co chairman of Pakistan People's Party, whose party heads the ruling coalition, has been pushing for greater business ties with India to drive economic growth within his own country. He recently offered to set up economic zones along the border with India and to source gas and fuel supplies for India. Mr Zardari has also suggested that India and Pakistan could collaborate to exploit the Thar coal reserves in Sindh province for generating power that could be supplied to both countries.
Steel price caps and cement export bans effective in Egypt
Daily Star Egypt reported that Mr Hisham Talaat Moustafa chairman of General Section of Real Estate Investment has lauded Egypt government’s recent decisions taken to cool rapidly spiraling prices.
Mr Moustafa said that "I believe the government introduced effective procedures to contain the relentless leaps in prices of construction material including the cement export ban and steel price caps."
He pointed out that after the government banned cement exports, prices slid back to around EGP 500 per tonne as compared to the previous EGP 700 to EGP 800 per tonne. He added that "The same is true for steel, placing price limits on wholesalers and retailer has helped push prices down."
It may be noted that, since the beginning of the year, a series of upsurges raised construction costs in Egypt some 30% pressured by continued spikes in input costs such as iron ore, scrap metal, billets and coal.
Record high price leaps brought steel prices to roughly EGP 7,800 per tonne and cement to nearly EGP 800 per tonne. Hikes in production prices have prompted the ministry of trade & industry to ban cement exports in late March 2008. The government also amended last April customs duties and lifted tariffs on cement and steel.
Mr Moustafa said that GSREI would not overlook escalating prices in steel and cement that will eventually affect not only the building and construction industries, but also domestic economy and society in general. He particularly named Al Ezz Steel Rebars prices as being cheaper than international ones despite angry accusations the heads of the two companies exchanged in April over their respective annual financial results.
Oman inks MoU with Port of Salalah for container berths
Oman Observer reported that Omani government has signed a MoU with Port of Salalah for the construction and operating of 3 additional deepwater container berths, which will give the port a total of 9 berths totaling 3,555 meters in length.
Mr Gary Lemke CEO of Port of Salalah said that "The signing of this MoU is a clear indication of the government's intent to be at the forefront of regional port development and will enable the Port of Salalah to keep up with the growing demands and allow us to meet our customer expectations as a modern and efficient terminal."
As per report, berths 7, 8 and 9 are the first stage of terminal two and will encompass 1,350 meters quay wall and add additional 3 million TEU to the annual capacity. Berth 7 is expected to be operational in the first quarter of 2011, with berth 8 and 9 scheduled for completion in 2012.
Terminal 1 comprises 6 berths along 2,205 meters of linear berth operated with 17 super post Panamax gantry cranes. Additional 8 super post Panamax cranes and 4 mobile harbor cranes are on order. With the delivery of the new equipment, the capacity of berth 1 to 6 increases from 4.5 to 6 million TEU. The completion of Berth 7 to 9 will take the annual capacity of the port to 9 million TEUs with a total berth length of 3,555 meters.
Turkey may re invent coal if oil and gas prices continue to soar - Report
Mr Hilmi Guler energy & natural resources minister of Turkey said that Turkey might re invent coal if oil and natural gas prices continue to soar. He added that "Not only developing but also developed countries may be affected by the rising oil prices."
Mr Guler underlined importance of other energy resources such as wind, solar, water, geothermal and energy efficiency and said that Turkey would use those resources. He added that Turkey is working on new projects on energy independence that might be an example for other countries.
6 killed in under construction building collapse in Ajman
PTI reported that the bodies of six Indian workers, killed when an under construction building collapsed on them in the UAE, have been pulled out. Police said that the rescue units with the aid of sniffer dogs recovered the bodies of all the six Indian workers who went missing after the collapse.
The victims were working with Seidco General Contracting, which was building the Laguna Beach Hotel in Ajman emirate of the UAE. The accident occurred on Monday when the workers had gone to plug a leakage in the concrete ceiling of the basement of the building.
Police said that "The workers, all carpenters, were trying to add more support to the columns that hold the ceiling when the freshly laid concrete and steel pipes collapsed.”
Colonel Ali Abdullah Alwan chief of Ajman Police said that 11 officials of the construction company have been detained for questioning.
L&T may bid for new Muscat airport project
It is reported that Larsen & Toubro Limited is planning to bid for building a new airport in Muscat.
Mr KV Rangaswamy president of L&T's construction division said that "The government of Oman is in the process of inviting bids and we will be submitting bids. The contract could be worth up to INR 30 billion. We will look for foreign airport modernization contracts and Greenfield airports as and when they come up."
L&T, which has built two new airports in India, is also involved in modernizing the Delhi and Mumbai airports.
Muscat's current international airport can handle 4.2 million passengers, while the new one planned 15 kilometers away would have a capacity for 12 million passengers that would eventually go up to 48 million.
DNV wins 50% market for new vessels on order
It is reported that classification agency DNV Maritime has won 50% of Middle East and Indian market for new vessels on order or being built. It sets classification rules for ships, verifies compliance and issues survey reports and certificates.
Cash rich oil companies are driving the demand for offshore support vessels of various types, of which DNV has classified 300 currently on order worldwide.
Mr Eivind Grostad senior VP & regional manager of DNV Maritime said that "The regional offshore sector is exceptionally buoyant. We have 125 offshore support vessels currently being built to DNV class in local shipyards such as Drydocks World, Seaspray and Nicocraft as well as at Hindustan, Bhrati and Mazagon on the Subcontinent."
Besides the offshore support vessels, DNV has received a number of recent orders from local owners that include very large crude carriers for Vela International, chemical carriers for the United Arab Chemical Company and bulk carriers for Shipping Corporation of India. And the Abu Dhabi National Tanker Company has ordered several Aframax tankers.
Lafarge and Asiacell plan major investment in cement plant in Iraq
Reuters reported that France's Lafarge and Iraqi partner Asiacell is planning to invest around USD 550 million to raise cement capacity in Northern Iraq to help meet a shortage in the region.
Mr Faruk Mustafa Rasool chairman of Asiacell said that Lafarge already has a 65% stake in an existing 7,500 tonne a day plant at Bazyan in Iraq's Kurdish region. He added that "We will build a second line with capacity of 7,500 tonnes a day and the cost would be similar to the USD 550 million spent to build the first line."
Iraq has been working for the past 3 years to bring foreign investors to invest as much as USD 2 billion in its cement factories, but political interference and instability has delayed the effort.
The Iraqi cement industry's total annual production, from 17 factories, is between 4 million and 5 million tonnes, a fraction of its capacity of 25 million tonnes. Iraq imports around 6 million tonnes a year of cement from neighboring Syria and Lebanon to cover consumption.
Contractors halt projects to protest rising costs in Turkey
Today's Zaman reported that contractors affiliated with the All Contractors Federation have halted their ongoing projects to protest sharp hikes in steel and iron prices in recent months.
Mr Tahir Tellioğlu president of TMF said that the contractors who are part of the federation, which has around 30,000 members in eight cities, had stopped their construction projects on June 1st 2008 and would not resume until June 15th 2008.
He added that they had decided to halt ongoing projects at a special general assembly meeting as a reaction to the neutral stance adopted toward the high prices by both the ruling and opposition parties.
He also said that the contractors are also protesting recent moves by the Housing Development Administration of Turkey, which they say is becoming a professional company that aims to maximize profits, contrary to its major duty of producing low cost houses for low income groups.
Dana Gas and Emirates launch common user gas pipeline
Dana Gas and Emirates General Petroleum Corporation have jointly inaugurated Middle East's first common user gas pipeline, located in Sharjah.
Dana Gas and Emarat each have a 50% stake in the construction, ownership and operation of the pipeline. Phase I was completed in May 2006 and has since been delivering gas to the SEWA power station at Hamriyah.
The main pipeline of the joint Hamriyah Gas Pipeline Project is a 48 inch gas pipeline that connects the Sharjah gas hub at Sajaa to the fast growing industrial area at Hamriyah and covers a distance of 32 kilometers, with a capacity of 1 billion cubic feet per day. The new 48 inch pipeline is now ready to receive gas supplies from Sajaa and deliver them to the premises of the 3 end users at Hamriyah.
Mr Rashid Al Jarwan GM of Dana Gas said that "This strategic partnership has set an example for further regional co operation."
Mr Jamal Abdul Rahman Al Medfa acting GM of Emarat said that the project has a great deal of importance for Emarat and is in line with the company's strategic plan.
It may be noted that Dana Gas and Emarat, along with the 3 end users namely Federal Electricity & Water Authority, Sharjah Electricity & Water Authority and Dana Gas affiliate Crescent Natural Gas Company, agreed in January 2006 to build and use the pipeline.
Aramco raises LPG prices to record high for June shipment
Saudi Aramco has raised prices of cargoes loading in June 2008 to a record after global crude oil benchmarks climbed to all time highs last month. It increased the price of propane cargoes by USD 50 or 6% MoM from a month ago to USD 895 a tonne.
Aramco raised the price of butane by USD 60 or 7% MoM to USD 920 a tonne from a month earlier.
Aramco sells LPG under one year contracts and individual cargoes for immediate delivery. The cargoes are sold free on board, requiring the buyers to pay for shipping costs.
Kuwait plans to produce 1 BCFD of gas by 2015
Mr Mohammad al Olaim oil minister of Kuwait has declared that Kuwait is to start its production of free gas from its gas fields. He added that production will start with a 50 million cubic feet per day of non associated gas and will increase to 175 million cubic feet 10 days later.
He said that Kuwait ultimately plans to boost daily production to 1 billion cubic feet per day of gas by 2015. Plans had been to start in late December 2007, but were stymied by technical hurdles. He added that besides free gas, Kuwait will also be producing 50,000 barrels per day of light oil and condensates.
In March 2006, Kuwait announced the discovery for the first time of 35 trillion cubic feet of free natural gas and about 10 billion barrels of light oil in its northern oilfields.
AFICO to complete construction of new facility in Dammam
Arabian Fiberglass Insulation Company Limited, a JV between Owens Corning and Zamil Industrial Investment Company and a sector business of Zamil Industrial, recently announced the completion of a major capacity expansion at its manufacturing facility located in Dammam, allowing it to increase its production capacity by 50%.
With local and regional demand for the company's products rising rapidly, AFICO is well positioned to meet current demand as well as projections for increased demand into the future. It recently invested more than SAR 60 million in upgrades and expansion. In addition to this expansion, AFICO is actively progressing toward new additional capacity in Saudi Arabia.
This new facility will allow AFICO to continue to grow in proportion to the market for fiberglass insulation products utilized in residential, commercial and industrial construction projects throughout the GCC region.
Once approved, construction of the new facility in Dammam will move quickly. This facility will be built using advanced technology from Owens Corning, and feature fully automated production lines.
Mr Abdulla M Al Zamil board member of AFICO and also COO at Zamil Industrial said that "With the latest technology and the support of Zamil Industrial, AFICO is uniquely qualified to function as a regional leader in the fiberglass insulation products industry well into the future."
Order in PSM land case set aside
Daily news reported that a Sindh High Court division bench set aside a single judge’s order for payment of interest to the owners of the land acquired for the Pakistan Steel Mills on the compensation paid to them.
The judge had allowed the owners’ plea rectifying a 1985 judgment by another single judge. The 1985 judgment called for payment of compensation to the owners of the land acquired for the PSM in 1974 under the Land Acquisition Act. There was no mention of interest on the amount of compensation.
The owners approached the high court for payment of interest through advocate Mr Adnan Memon, saying that they were entitled to the benefit of Section 28 A of the Land Acquisition Act. The judge allowed the plea holding that the owners could not be denied the benefit of the provision.
The single judge’s order was challenged by the PSM through advocate Mr Mohammad Nawaz Shaikh. Assailing the order, the lawyer argued that the judge had wrongly assumed jurisdiction under Section 152 of the CPC.
The division bench, which consisted of acting chief justice Mr Azizullah M Memon and justice Mr Arshad Noor Khan, set aside the single judge’s order and remanded the case to him for re hearing in the light of its observations.
Only a free market will end steel saga in Egypt – Experts
Daily News Egypt quoted experts and steel importers in Egypt as saying that opening up the market to steel imports and facilitating customs entry procedures is crucial to stabilizing the steel market.
As soaring steel prices recently hit EGP 8,000 per tonne, some wholesalers and investors figured that it would cost less to import steel from steel rich countries than it would to buy it locally. Even after the added customs and shipping costs, it would be cheaper to buy steel from abroad.
The report cited Mr Khalid, an investor who used to own a steel plant, as saying that "A tonne of steel in the Ukraine costs around EGP 5,500. After adding shipping and customs costs, we planned to sell a tonne of steel to retailers at a price of EGP 6,250, which is significantly lower than current local prices. So, we decided to import steel from the Ukraine, one of the most distinguished steel producing countries in the world."
Mr Rachid Mohamed Rachid minister of trade & industry recently announced that steel manufacturers will be required to set a fixed selling price at the start of every month. He added that "Prices will be monitored by the ministry of trade & industry to ensure that they are applied and strict consequences will result on those who do not abide by their set prices."
The ministry brushed off the suspicions saying that manufacturers were required to increase their production by 20,000 tons last week to meet the increasing demand and economies of scale could lead to a lower production price for Al Ezz.
3M to establish manufacturing plant in UAE
Gulf News reported that Minnesota, Mining & Manufacturing is planning to establish a manufacturing plant in the UAE in 2008.
Mr Irfan Malek MD of Minnesota, Mining & Manufacturing for Middle East and Africa said that it is looking to expand operations in the country from the manufacturing and technical and professional services aspect. He added that "If all goes as planned, we will start the construction of the plant in the next few months."
According to Mr Malek, the manufacturing and technical developments will represent a major part of investment. He said that an exact value of investment has not been decided yet as officials are still in the phase of considering operations within the plant. Thereby, if there is any specific value now, it could significantly change.
In Saudi Arabia, 3M's growth efforts revolve around elevating technical and professional services as well as geographical expansion within the country by setting up more sales and distribution offices.
Mr Malek said that "A country like Saudi Arabia cannot be covered from one point you need to expand the sales and distribution. That is where we are putting our money now. As Qatar starts to increase its construction activities and health care facilities and put money back into the economy, the market, it will be very attractive for us. All the countries are doing well but the extensive expansion plans are surely in the UAE and Saudi Arabia."
Pakistan trade deficit may cross USD 20 billion this fiscal – Report
Business Recorder reported that Pakistan's trade deficit is likely to cross USD 20 billion mark this fiscal mainly due to sharp rise in imports low exports.
Although the State Bank of Pakistan took some bold steps to bring down the increasing imports, analysts believe that these steps had been announced very late, when the imports and trade deficit had already breached all barriers.
The State Bank of Pakistan imposed 35% margin on all import letters of credit, except oil and some food items from May 23rd 2008, aimed to bring down imports and the rising trade deficit. Earlier, there was no percent margin on LC opening, and importers were importing goods over and above the requirement, putting extra burden on the national exchequer.
Analysts said that during the remaining two months of current fiscal year no positive impact of this step may be witnessed, as importers had already has placed huge import orders. However, they believed that in FY09 imports would definitely decline due to the 35% margin.
Economists have predicted that this year trade deficit would cross USD 20 billion or about 49%, with about USD 37.5 to USD 38.5 billion imports and USD 18 to USD 18.5 billion exports. The targeted trade deficit for the current year was USD 13.1 billion, with USD 19.2 billion exports and USD 32.3 billion exports.
Pakistan's trade deficit has already reached at all time high level of USD 16.08 billion the first 10 months of current fiscal year as imports stood at USD 32 billion and exports at USD 15.25 billion.
Oil revenues in Iraq could reach USD 70 billion in 2008
Mr Hussein Al Shahrastani Iraqi oil minister said that Iraq has increased its oil production to a post war high, earning billions of dollars to fund reconstruction. Production had also climbed to a post war high of more than 2.5 million barrels per day.
Mr Shahrastani further added that he expects this year's oil production to reap earnings of USD 70 billion if oil prices remain high and there are no output disruptions. Moreover, he is confident that Iraq could pump up to 2.9 million barrels per day by the end of 2008.
ME Development plans USD 200 billion Red Sea project
Dubai based Middle East Development said that it is planning to develop a project to build the first bridge across the Red Sea linking Yemen and Djibouti, and associated new urban areas, at a total cost of USD 200 billion.
Mr Issam Halabi VP for technical affairs said that Middle East Development will invest at least USD 10 billion in the project and seek to raise the remainder from other investors and financial institutions. He added that "We will have seed capital of at least USD 10 billion and USD 190 billion in project finance."
Mr Halabi said that the bridge, which will be 28.5 kilometers long and carry vehicles, trains, natural gas and water, will cost USD 14 billion, with construction completed in phases over 7 to 15 years. He added that the associated town projects in Yemen and in Djibouti will include residential, commercial, healthcare and entertainment areas.
Gaz de France and Dana Petroleum found gas resource in Egypt
Gaz de France and partner Dana Petroleum have found gas in Egypt's West El Burullus concession.
The two partners also said that they discovered natural gas deposits in the West El Burullus concession where they hold an exploration and production license.
The license, covering a total area of 1,364 square kilometers, concerns an offshore concession in the Mediterranean to the northeast of Alexandria. It is held on a 50:50 basis by Gaz de France and Dana Petroleum.
Iran to invest USD 120 billion to become top global LNG producer
Press TV cited Mr Ali Kheirandish MD of Iran LNG Company as saying that Iran has no problems securing investments to the tune of USD 120 billion to become the world's top exporter of liquefied natural gas within the next 12 years. He added that "It has already secured USD 5 billion in financing for investment from its own resources, partners and banks. Many financiers have come to us with very attractive offers and we expect a lot more banks to make offers."
Mr Kheirandish said that added it expects to produce 80 million tonnes a year of LNG by 2020. He added that "We could increase the level after that period but it will depend on the market and other conditions."
As per report, as much as 70% of Iran's LNG production would be sold to Asia and Europe under long term supply contracts, with the rest of the world able to make purchases on the spot market.
Iran holds the world's second largest gas reserves after Russia. However, Iran's LNG projects, like other hydrocarbon schemes in the country, are facing severe delays due to US sanctions imposed on the country over its controversial nuclear energy program and escalating project cost.
UAE may become first country in GCC to bring in VAT
According to a Dubai Customs Authority report, UAE is likely to be the first in the GCC to bring in VAT, which will replace customs duty charged at 5%.
The reported said that UAE will introduce the tax at a rate between 3% and 5%. The introduction date will be announced by the federal government within the next few months.
Mr Ahmed Butti Ahmed director general of the Dubai Customs Authority said that VAT was applied in more than 145 countries and had proved to be the world's fairest and most transparent form of taxation. He added that "The coming period will be exceptional as the UAE is likely be the first country in the Gulf to apply VAT."
Mr Ahmed said that "This will give the UAE a number of advantages and the tax will support the country's economic boom. No outside force is imposing VAT on the UAE. The UAE chose to embrace it and will deploy it to its advantage. The removal of customs duty is an important step towards forming strategic partnership with Australia, China, the European Union states and the US."
It may be noted that Dubai Customs and the International Monetary Fund have completed a study on the implementation of VAT in the GCC. Dubai began planning for the introduction of the tax as early as 2006.
Bahrain forms USD 2 billion construction company
Asharq al Awsat Newspaper reported that seven Bahraini investment firms formed a company with a capital of USD 2 billion to manufacture construction materials.
The new company, to be called Binaa, plans to produce cement, glass, steel and aluminum to meet the rising demand for construction materials.
Turkish Erdemir Q1 2008 net profit up by 57% YoY
Turkish steel maker Erdemir has posted consolidated net profit of TRL 226.6 million for January to March 2008 quarter up by 57.3% YoY as compared with TRL 144 million.
China would need 50 million tonnes steel for reconstruction
It is reported that reconstruction of the quake hit areas involving 15 million people to be settled down is becoming a focus nowadays with the rescue and relief work gradually winds up. It is estimated that the overall reconstruction will need about 50 million tonnes steel products in next 5 to 10 years.
Industry insider said that the reconstruction will also witness a process of urbanization. If per capita steel consumption is 0.33 tonnes per year the reconstruction work will require at least 5 million tonnes each year adding up to 50 million tonnes in ten years.
Mr Zhou Xizeng an analyst with CITIC Securities contended that considering the proximity factor, the steelmakers to directly benefit from this quake will include Chongqing Steel, Pangang Steel & Vanadium Co, Valin Pipe & Wire, Maanshan Steel and Anyang Steel etc.
He however warned that "But a strong market does not mean fat profits. Steel prices in the disaster affected areas are intervened."
Chinese rebar and wire rod export offer further increase
It is reported that Chinese construction steel prices seem to have finished downward correction and start another round of increase. Less output, higher production cost and robust demand are believed to be bolstering the upward trend.
Shanghai market prices HRB335 20mm rebar is being quoted at CNY 5420 per tonne to CNY 5430 per tonne, HRB400 at CNY 5700 per tonne to CNY 5730 per tonne up by CNY 70 per tonne to CNY 100 per tonne from last week. Price for commercial wire rod is at CNY 5870 per tonne that for hi-speed material is tagged at CNY 6100 per tonne to CNY 6110 per tonne up by CNY 100 per tonne
Rebar and wire rod prices in Beijing market have seen remarkable rebound. 6.5mm hi speed wire rod by Tangshan steel is being quoted at CNY 5980 per tonne up by CNY 30 per tonne. HRB335 and HRB400 16mm to 22mm rebar price are largely unchanged at CNY 5570 per tonne and CNY 5770 per tonne respectively.
Export offer for rebar with boron is being quoted at about USD 1000 per tonne FOB and most are from such South China based steel makers as Guangzhou Steel, Xiangtan Steel and Liuzhou Steel. Rebar without boron is at USD 1100 per tonne FOB.
(Sourced from MySteel.net)
Small and medium steel mills cut production due to Olympic
According to Mr Sun, owner of a private steelmaker, small and medium scale steel makers in Qian'an have generally cut production by 30% to meet the environmental standard."
As Qian'an is close to Qinhuangdao, one site of the 2008 Olympic football game and adjacent to Beijing-Shenyang superhighway, many small and medium scale steel mills in the town have had to reduce steel output since early May.
Facing the pressure of environmental protection, Mr Sun's mill has cut down production from 5000 tons to 3500 tonnes per day which is up to the standard for pollution discharge. Moreover, the company will invest more in environmental conservation equipments, which normally account for 10% of the total fixed assets.
Numbers of steel mills alike present fairly high initiative in acquiring such equipment In order to survive. Meanwhile, large state owned steel mills like Tangshan Steel and Shougang have not been seriously impacted from the output control factors.
Update on Zhanjiang project
It is reported that Mr Huang Huahua governor of Guangdong, Mr Li Ronggen deputy governor and Mr He Wenbo of Baosteel jointly visited Zhanjiang port and learned the details about the evolvement of the Zhanjiang steel project's preparation work.
After the visit, Mr Huang Huahua made positive comments on the project's prophase work by saying the work is in smooth progress, the Longteng logistics pellet item an independent project supportive to the steel base also gets on well and the land levy and resettling work is carried on in steps.
Mr Huang said that incorporation of the Guangdong Steel Group should be picked up. He said that a good scheme has been made on the group incorporation, and called all parties to continue to push it forward and insure the unveiling within this year.
He said that further efforts should be made to strive for a quick approval for the overall construction. Supported infrastructures, like highway, railway, bridge and water supply is expected to be planned as soon as possible.
Zhanjiang project is designed with 10 million tonnes per year capacity in the first phase with total investment of CNY 69.6 billion.
Chinese mills pledge to freeze color coated steel prices
It is reported that more regional governments have intervened in the price limits of steel products and cement for use in post quake relief. A host of mills have pledged to freeze their color coated steel at pre quake levels.
Central China’s Wuhan Steel has kept the June delivery price for color coated steel unchanged as promised in spite of the weekly price rally of CNY 100 per tonne to CNY 400 per tonne in the spot market. Moreover, the company has volunteered to produce 20,000 tonnes of color coated steel for fulfilling Hubei's commitment of providing 85,000 pre-fabricated houses for the disaster zones.
In the mean time, nine steel mills in Hebei producing color coated steel for use in quake relief have also issued a joint statement that they would ensure sufficient supply and frozen prices. Hebei has been assigned to 80,000 pre fabricated houses which would require 10.84 million tonnes of color coated steel, mainly supplied by Tanggang and Handan Steel.
CISA joins NDRC in steel price limits
It is reported that China Iron & Steel Association has advised its members to stop increasing prices of steel products destined for reconstruction and relief operation in quake hit areas.
CISA has forwarded the top planning body's directive to all its members and urged them not to increase the price of hot rolled coil, color coated coil and structural tube above levels prior to the devastating earthquake. The mills have been told that any price rises already implemented would be rescinded.
The move has come after the price limit order issued by National Development & Reform Commission. According to NDRC's CISA members are also required to supply materials directly to the quake stricken areas and prevent any price bidding in the circulating process.
(Sourced from MySteel.net)
Oldest shipbuilder in China makes way for Shanghai Expo 2010
Xinhua reported that China's oldest shipbuilder, the Jiangnan Shipyard Corp completed the move to a new home to make room for World Expo 2010.
The report said that work on the CNY 16 billion new shipyards started in 2005. It is the first phase of the Changxing base and has a production capacity of 4.5 million DWT with a 3.8 kilometer coastline, four docks and three production lines.
Mr Guo Xiwen China State Shipbuilding Corp chief economist told Xinhua that work on the second phase, with a 3.5 million DWT capacity is to start in 2009 and finish in about 2012.
China is the world's third largest shipbuilder after the Republic of Korea and Japan. It accounted for 23% of the world market with a production capacity of 19 million DWT in 2007.
Reconstruction boosts demand for HDG and PPGI in China
It is reported that recently Chinese HDG and PPGI price have been surging despite slow domestic steel market. Supply is reported to be quite short and prices are continuously on the rise.
As per report the price increase is across the board and there has been an average increase of CNY 200 per tonne for HDG and PPGI since late May.
On Shanghai market 1.0mm HDG by Wuhan steel is being quoted at CNY 7100 per tonne. 0.5mm HDG at CNY 7500 per tonne,1.0mm HDG by Anshan steel goes at CNY 7050 per tonne to CNY 7100 per tonne, 0.5mm PPGI by Baosteel is at CNY 8600 per tonne, Guangzhou market has witnessed a substantial rise of CNY 500 per tonne to CNY 600 per tonne during the past two weeks
The major reason for the price surge is the reconstruction in earthquake hit Sichuan province. The constructions for 1.5 million temporary houses require at least 700,000 tonne of PPGI. Such a great demand has put great pressure on steel makers and most steel makers have to set aside capacity for PPGI production. This has really led to tension in supply and price surge.
(Sourced from MySteel.net)
Pangang gets CNY 20 billion credit granted from Bank of China
It is reported that Pangang Group and Bank of China signed a CNY 20 billion worth of financial agreement for supporting the post quake reconstruction in the Southwest part of China.
As per report the earthquake substantially damaged the highways, bridges, infrastructures and houses in the Southwest, causing total direct economic losses of over CNY 150 billion. For reconstructing, it may need more than 6.5 million tonnes steel products as calculated. And the value is close to CNY 20 billion if per tonne steel product costs CNY 3000 on average.
Mr Fan Zhengwei chairman of Pangang Group said they will struggle to resume operation as soon as possible and devote into steel supply for the quake relief.
Bank of China has already granted credit of CNY 8.3 billion and provided load of CNY 4.4 billion to Pangang. And its branch in Sichuan donated CNY 300,000 in quake rescue. The bank said Pangang will play an important role in post quake reconstruction by supplying construction steels like vanadium-contained rebar.
Xinyu Steel commissions converter gas cleaner
It is reported that Xinyu Steel has commissioned a dust catcher as a part of its plan for improving environmental protection.
Girth washing equipment is the environmental facility, which matches with Xinyu Steel’s 3 million tonnes sheet plate converter project. The diameter of the equipment is 5 meters, 21 meters high, 86 tonnes weight, is the largest one in similar equipments. The equipment is constituted by washing tower, girth syringe, wet spin evaporator etc; the total investment is about CNY 6 million.
The equipment will play the remove dust cooling role for the converter production as well as creating favorable conditions for recycle of coal gas.
Wugang HSLA auto sheets cut auto costs by 10%
According to WISCO Group that since May, high strength auto sheets from Wugang launched commercial production and have been utilized to manufacture cars by Dongfeng and Chery and so on.
It is reported that this high strength auto sheet could cut steel consumption by 10% or so a car, compared with common auto sheets, and therefore it will reduce the weight of the car and decrease the fuel consumption while driving.
WISCO expressed that it is committed to help the downstream users by cutting costs through technology innovation, and make efforts to realize the auto industry’s environmental protection, economization.
China not limiting national cement prices - Mr Guo
Bloomberg cited Mr Guo Jingbin executive director of Anhui Conch Cement Co as saying that Chinese government will cap cement prices to curb inflation.
Mr Guo said “I don't think the government will impose nationwide price controls on cement. Cement was one of the first few products for which price controls were relaxed in China, so the government won't control its price in the absence of extenuating circumstances.”
He said that “China's National Development and Reform Commission have said it will place limits on the prices of basic materials used during the post earthquake rebuilding phase, including cement steel and glass. The specifics haven't been announced yet.
Mr Guo said “The price of cement in Sichuan province was around CNY 600 per tonne before the earthquake, compared with a national average of about CNY 300.
He said that “Cement prices in that region were the highest in the country even last year. Without government controls, the price there could exceed CNY 1,000 per tonne after the earthquake.''
Anshan Steel delivers first supplies for earthquake relief
It is reported that 5,000 tonnes of HR coiled sheet and 1,000 tonnes of color coated sheet was shipped from Yingkou Port. This was the first batch of steel products manufactured by Anshan Steel for earthquake disaster areas.
As per report Anshan Steel received the announcement from State owned Assets Supervision and Administration Commission on 23rd May and was ordered to produce 30,000 tonnes of HR coiled sheet for Guangdong Huaguan Steel Co to manufacture earthquake prefabs. On 27th May, the company accepted the production mission from province Liaoning of 20,000 tonnes of color coated sheet and 10,000 tonnes of galvanized sheet for the manufacture of earthquake prefabs.
Anshan Steel has already completed the production of 1,000 tonnes of galvanized sheet and 7,500 tons of color coated sheet. After active communication with consumers in both domestic and international market, Anshan Steel has successfully delayed color coated contracts for June delivery to August.
Laiwu Steel to acquire Shandong based chemical energy company
Laiwu Steel Corporation announced that the Company will purchase all the contribution of a Laiwu based investment company in a Shandong based chemical energy company at a deal price of CNY 6,036,200.
The released added that after the transaction, Company A will become a wholly owned subsidiary of the Company.