Indian Steel Price Index shows upward trend this week

LPPI – Long Product Price Index
FPPI – Flat Product Price Index
ISPI – Indian Steel Price Index

(Sourced from www.steelprices-india.com)

POSCO calls for expediting land and iron ore mines allocation

ET reported that POSCO has asked the central government to expedite allocation of land and iron ore mines to the company to kick start its USD 12 billion Orissa project.

Mr Vikash Sharan senior GM of POSCO of India said that "Process of clearances and approvals have taken little longer time than what we had expected.”

But he added that POSCO has got strong support from both the central and the state governments and is hopeful that the clearances will come at an early date.

Mr Saran said that “The common concern of the investors was delay in allocation of mineral linkages and land acquisition.”

As per the report, POSCO needs 4,004 acres for its proposed 12 million tonnes steel plant in Jagatsinghpur district of Orissa. Of the total land required, 3,566 acre is government land of which 2,959 is deemed forest area.

POSCO forest diversion plan for the said land has already been approved by Orissa Government and the Ministry of Environment and Forest. It is now awaiting clearance from the Supreme Court.

HRC looses and wide plates gain on Mumbai market

HRC has dropped a bit in Mumbai due to less demand and hence traders are selling at INR 1000 per tonne less to book profit.

In wider width plates, there is an acute shortage in the market hence price has increased.

A Local mill has increased prices in GP and GC by INR 1000 per tonne hence there is a slight change and more price rise will be seen in a couple of days.

Price in INR per tonne
Inclusive of ED and VAT
Delivery – FOT

(Sourced from www.steelprices-india.com)

Essar inks pact with IMMT-B for iron ore beneficiation technology

FE reported that Essar Steel Limited has signed a MoU with the Institute of Minerals and Materials Technology of Bhubaneswar for research and development of iron ore beneficiation technology. MK Sampath COO of Essar Vizag and Mr Barada Kanta Mishra director of IMMT-B signed the MoU.

As per report, the expertise of IMMT-B will also be used to recover iron values through processing of plant wastes like tailings and slimes of mines and assess plant performance when different types of feed materials are used. The tie up with IMMT-B will also provide the required technology for the 8 million tonnes beneficiation plant being set up by Essar Steel in Orissa. Besides, IMMT-B will help Essar fine tune its plant operations in India and abroad.

Essar Steel selected IMMT-B for the job on the basis of the scientific organization’s work at Essar Kirandul. The scientists of IMMT-B enabled Essar's beneficiation plant to run at capacity. The plant, originally designed to run at a capacity of 700 tonne per hour was down to 450 tonnes per hour to 500 tonnes per hour.

Mr Sampath said that "The Essar group has plans to set up iron ore processing units in various parts of India and abroad. Essar Steel's tie up with IMMT-B will help use indigenously developed technology for processing of low grade iron ore to recover iron value and optimize operations at the company's beneficiation plant at Kirandul in Chhattisgarh."

Indian steel price index to show you market trends

Amidst the currently prevailing volatile and speculative steel price scenario in India, SteelGuru.com has started the much needed barometer to track and measure the price movements on daily basis.

Steel prices being an issue at the forefront in the context of inflation, drawing significant government attention, making up for about 4 per cent in the Wholesale Price Index(WPI), has been media’s most favorite and hot topic at the moment. Unfortunately, the facts are misrepresented very often due to complexity in the structure and the dynamics of the steel market, leaving the users of the information mostly in a state of confusion.

In order to provide an index for steel prices, we call it SENSEX for steel, SteelGuru.com decided to work on both long products and flat products for respective category indices as also a composite one for steel. We call them LPPI, FPPI and SPI and have started releasing these indices with effect from July 1st 2008, after taking June 30th 2008 as base.

LPPI is based on daily market prices of three benchmark products rebars, wire rod and sections in 4 metros, whereas FPPI is based on HRC, plates, CR and HDG. These indices have been built considering their respective weights in the composite categories as also in the shares of sales in the regional markets.

The pricing input is from www.steelprices-india.com, which publishes market transaction prices of benchmark products among select locations 5 days a week.

These price indices outline the way domestic steel market is moving day by day and will help producers, agents in the supply chain, steel buyers, bankers and analysts in their respective businesses.

Mandi market shows downward trend

Mandi Govindgarh

Price in INR per tonne
Inclusive of ED and VAT
Delivery – FOT

(Sourced from www.steelprices-india.com)

Indian Railways invites global tenders for rolling stock JVs

PTI reported that Indian Railways, as part of embarking on joint ventures with private companies to manufacture locomotives and passenger coaches, have invited global tenders to identify suitable partners for its ventures.

Mr Raj Kamal Rao member mechanical of Railway Board said that "The JVs were for passenger coach manufacturing facility at Raebarelli in Uttar Pradesh, a diesel locomotive manufacturing unit at Madora in Bihar and production of electric locomotives at Modepura also in Bihar.”

He said that the units were expected to come up within the next three years at an expected cost of around INR 2,200 crore. He added that the railway was in the process of producing stainless steel goods wagons instead of the mild steel ones.

CCEA approves acquisition of 4 Panamax by SCI

It is reported that the Indian Cabinet Committee on Economic Affairs today gave its approval for acquiring four Panamax Bulk Carriers of about 80,000 DWT each at a price of USD 59.55 million per vessel.

The Shipping Corporation of India would avail external borrowing of up to 80% of the contract price of each vessel from banks and financial institutions either from the international market or the domestic market. SCI will pay the balance amount of 20% from its Internal Resources.

The acquisition will lead to
1 The vessels would provide replacement for SCI’s already scrapped Panamax bulk carrier and would augment SCI’s ageing bulk carrier fleet.

2. Acquisition of proposed vessels would augment the Indian dry bulk carrier tonnage as also the share of Indian Lines in India’s overseas trade.

3. Employment of Indian flag vessels for the trade would result in net foreign exchange savings for the country.

Ship plate cutting prices at Alang jump by 1.5%

Alang
Plate cuttings
Rolling
1”

Price in INR per tonne
Inclusive of ED and VAT
Delivery – FOT

(Sourced from www.steelprices-india.com)

Scrap prices slip by INR 500 at Kandla

Kandla
Melting scrap
80:20
HMS

Price in INR per tonne
Inclusive of ED and VAT
Delivery – FOT

(Sourced from www.steelprices-india.com)

Maytas consortium emerges as lowest bidder for Hyderabad Metro

BL reported that Maytas Infra Limited led consortium has emerged the lowest bidder for the INR 11,814 crore, Hyderabad Metro Rail Project that seeks to construct a 71 kilometer long elevated railway in the twin cities of Hyderabad & Secunderabad. The official clearance is expected soon after getting the bid vetted by the authorities concerned.

The Maytas Infra led consortium included Navabharat Ventures Limited, Ital Thai Development Public Company and IL&FS. It has emerged the lowest bidder among the 5 players that were short listed for the project.

Maytas Infra spokesperson said that “We were informed that our consortium has emerged as the lowest bidder for the project. He added that declined to give details of the project. We still await the official communiqué from the Government.”

The consortium has reportedly agreed not to use the viability gap funding up to 20% of the project cost offered by the Union Government.

AP government has formed a special purpose vehicle called Hyderabad Metro Rail Limited to take up the project. Conceived to ease the ever increasing traffic on the city roads, the Metro Rail Project would cover 3 different lines with a total length of 71 kilometer with an initial estimation of INR 9,696 crore. The project cost has recently been hiked to INR 11,814 crore by the Government.

World Bank to provide loan for road projects in Orissa

It is reported that the a formal agreement has been signed under which World Bank will provide loan assistance of INR 1,070 crore for road projects in Orissa.

As per report, the World Bank loan covers 80% of the project cost while the rest 20% will be financed by the state government. The loan will be repaid over a period of 25 years including a grace period of 5 years.

Under the Orissa State Road Project, a total of 461 kilometer of road will be improved to 2 lane road with paved shoulder and reconstruction of the bridge on Bansadhara near Gumuda will be taken up in two phase.

1. The project 204 kilometer of road will be constructed. It includes construction of 68 kilometer Bhawanipatna to Khariar road, 95 kilometer long Chandbali to Bhadrakh-Anandapur road and 41 kilometer Berhampur to Taptapani road.
2. The construction of 257 kilometer of road will be taken up. This includes Taptapani to Raipanka road 68 kilometer, Raipanka to JK Pur 83 kilometer and Jagatpur to Chandabali 106 kilometer.

The report added that the contract for Berehampur to Taptapani road has already been awarded and bids for Bhawanipatna to Khariar and Chandbali to Bhadrakh-Anandapur roads are under evaluation. Besides, these roads feasibility report and the bid documents for the 4 laning of the 165 kilometer Sambalpur to Rourkela road, 2 laning of the Joda to Bambry road and 2 laning of the 46 kilometer Koira to Tensa-Lahunipara.

Orissa plans JV with NHPC for hydel projects

Project Today reported that Orissa government is negotiating with National Hydroelectric Power Corporation to form a JV to implement the 10 hydel projects.

While NHPC will act as the chairman of the new joint venture company, both will have a stake in 51% and 49% ratio. The proposed projects were likely to be beneficial to several coastal districts besides some others like Keonjhar, Boudh and Kalahandi.

This apart, the state government had also planned setting up several mini-hydel projects to generate about 170 MW of power during the 11th five year plan. While the government had already sanctioned 22 new mini hydel projects, it received another proposal from Velcan Energy for setting up of six mini-hydel projects over river Baitarani which would generate 110 MW of power.

Lafarge to invest USD 1 billion in India expansion

Reuters reported that French cement maker Lafarge plans to invest USD 1 billion over 5 years to expand its cement capacity in India to about 20 million tonnes.

The report added that Lafarge plans to build 3 plants with a capacity of 2.5 million tonnes each.

It is currently expanding its 3 plants in India to reach an annual capacity of 12 million tonnes.

Lafarge bought top engineering and construction firm Larsen & Toubro's concrete unit for USD 350 million in May 2008.

UltraTech Q1 net profit up by 10%

BL reported that hit by the 6 week cement export ban and high input cost UltraTech Cement has reported a muted 2% YoY increase in net profit at INR 265 crore in Q1 of 2008 against INR 259 crore registered in the same period in 2007. Net sales increased 10% YoY to INR 1,496 crore in the quarter under review.

Profit in INR crores

Mr Kumar Mangalam Birla chairman of UltraTech Cement said that the results are lower than that of the preceding quarter reflecting the impact of higher input costs which have not been passed on to the consumer.

He said that “Coal prices have rise up from USD 78 tonnes in Q1FY 2008 to USD 179 tonnes in Q1FY 2009. Cement prices have also been contained given the Government’s concern over inflation. Unless this is contained, it can slow down construction growth and consequently the demand for cement.”

Mr KC Birla senior executive president & CFO of Ultra Tech said that “The company is scouting for mines in Indonesia & South Africa to tide over the increasing coal prices. The impact of increasing in coal and fuel prices is about INR 10 per 50 kilogram bag. With an expectation of demand softening, the company will take a call on how much of this can be passed on to the end users.”

Diamond Power commissions power cable unit in Vadodara

It is reported that Gujarat based Diamond Power Infrastructure Limited recently commissioned its new high tension power cables manufacturing facility at Vadadala in Vadodara.

Built at a cost of INR 30 crore it will be an integrated unit from making rods up to cables.

As per report, the unit that can produce 2,800 kilometer of cables annually is equipped with technology and machinery sourced from Germany and China.

Mr Robert Petty managing Partner of New York based Clearwater Capital Partners has invested in Diamond Power Infrastructure Limited.

Gujarat Fluorochemicals to start wind farms in Rajasthan

Project Monitor cited a senior official as saying that Gurgaon headquartered Gujarat Fluorochemicals Limited is in an advanced stage of commissioning a large wind farm in Jodhpur district of Rajasthan.

He said that out of the total 31.5 MW capacity and 12 MW had been completed so far. The remaining capacity would come on line shortly.

In 2006 or 2007 GFL commissioned a 23.1 MW wind power project at Gudhe village near Panchgani in Satara district of Maharashtra. Both the wind farms will be grid connected and will earn carbon credits for the company.

As per report, Rajasthan is emerging as an important destination for new wind farms although it is currently not amongst the top 5 states in terms of installed capacity. As of 2007 end Rajasthan had a total of 496 MW accounting for a 6.3% share in India's total capacity.

Meet on steel export duty on steel for SEZs

BS reported that the officials of Commerce and Finance Ministries are expected to meet shortly to resolve the issue of 5% to 15% export duty on various iron and steel products entering into SEZs imposed by the Central Board of Excise and Customs 2 months ago.

A senior commerce ministry official said that "We had earlier taken up the issue with the Cabinet Secretary and a meeting in this regard will be shortly held with the Finance Ministry to resolve the issue."

Supporting the demand of industrial units in the SEZs, the Commerce Ministry has pointed out that the steel products which enter into the tax free zones are not exported or sold in the domestic market. Rather, these are consumed within the SEZs to produce commodities for exports.

The official said that there is no rationale to bring inputs utilized in the SEZs under the tax net which have been developed for export products and exempted from all taxes.

A senior Finance Ministry official had earlier said that the proposal to exempt steel items entering SEZs from export duty is under consideration of the tax division but no decision has been taken so far in this regard.

Shalivahana Power revises capacity

Projects Monitor reported that Shalivahana Power Corporation Limited has proposed to set up a 1x300 mw thermal power project at Achalapur in Adilabad district of Andhra Pradesh instead of the proposed 2x135 mw plant after it was refused coal linkage by Central Electricity Authority.

According to the report the standing committee of the CEA refused the company's request for coal linkage for its 2x135 mw plant to prevent the mushrooming of small units that would lead to environment degradation. The committee also informed the company that proposals from units with capacity of 250 mw and above should achieve higher plant efficiency and assure optimum utilization of coal resources.

The developer, therefore, decided to implement a 300 mw power plant at Achalapur in Adilabad district and forwarded a fresh proposal for coal allocation.

BEML to supply equipment to Indonesian coal miners

BS reported that Bangalore based BEML Limited has won two orders from Indonesian companies for supply of mining equipments.

The larger of the two orders is from Pt Fajar Bumi Sakti is for supplying 93 equipment consisting of hydraulic excavator, rear dump truck and bulldozer, together valued at INR 158 crore.

The other order is for the supply of 35 machines worth INR 49 crore to Far East Resources & Mining PTE Limited, Singapore, for their coal mines at Tarakon in Indonesia.

Meanwhile, BEML also has plans to establish a sales office cum repair facility and spares depot at Balikpapan in Indonesia in the next two to three months.

Indian Railway to conduct feasibility survey of HP project

Projects Today reported that the broad gauging Pathankot Jogindernagar line upto Leh, Ladakh in Himachal Pradesh is to take shape as Railways have asked a private company to survey the project and conduct a feasibility study.

According to the report there has been demand from the government for broad gauging the route. The project estimated at the cost of INR 65,000 crore will benefit country's security and tourism.

Earlier, the project was considered economically unviable by the centre but the state government endorsed its strategic significance for India in view of China expanding its Railway line up to the borders.

Chinese HRC imports into India at Mumbai

It is learnt that 22000 tonnes of Chinese HRC in structural grade has been booked by two local traders at USD 1030 per tonne CNF Mumbai. The consignment is expected to reach Mumbai by end August.

As per market sources, this consignment may depress HR prices in Mumbai as the landed custom cleared price would be about INR 53,000 per tonne EX Mumbai Port as against prevailing current domestic price of 55,000 per tonne in Mumbai

(Sourced from www.steelprices-india.com)

MEPS says that EU steel prices still rising due to scarcity of imports

UK based MEPS said that the EU flat products' market continues to be characterized by supply tightness and rising prices in a climate of relatively flat demand as the availability of competitively priced steel from third countries remains at a low level.

MEPS said that “ArcelorMittal announced a further increase on strip mill products of around EUR 50 per tonne for new bookings for September delivery. The company warned of probable further upward adjustments in forthcoming quarters. These proposals have no guarantee of success in the current climate.”

MEPS said that “Material is hard to locate in Germany with delivery lead times of around six to eight weeks for commodity grade products. Only small quantities are being offered by non EU mills and the prices are not interesting to German customers. Buyers tried to purchase ahead as they saw values constantly escalating and now business is starting to decline, particularly demand from construction. Projects may be cancelled due to the expense of steel.”

MEPS added that “Demand seems to be running out of steam in the French market and the pace of price rises has slowed down. There is very little imported material available and offers are higher than European ones. Negotiations have not yet started for the fourth trimester but buyers expect producers to try to implement increases of about EUR 50 per tonne. In the meantime, automotive annual contracts have not been renegotiated.”

MEPS said that “There is virtually no third country import pressure in Italy. The small quantities that are coming in are at very high prices. The dependence on domestic supply has allowed local mills to secure further hikes, despite relatively subdued demand. Inventories are at a reasonable level and there is certainly no speculative purchasing as both service centers and end users are finding it difficult to finance stocks. The banks are reluctant to lend money, especially to auto related companies. The economic outlook is poor and consumer spending is cooling rapidly.”

MEPS also said that “In UK demand is stagnant at best. Distributors continue to keep stocks to an absolute minimum because they are not selling large amounts to end-users. Manufacturing industry consumption is slowing, causing a lot of concern over the future direction of the steel market. However, supply remains tight as third country imports have dried up and ArcelorMittal has reduced sales to the UK because of the unfavorable sterling to euro exchange rate. Corus is expected to try to lift prices again in the fourth quarter. For now, the company has concluded most period three deals.”

MEPS said that “Belgian demand is relatively slow with end-users only purchasing small volumes at any one time from distributors, who, in turn, are keeping their own stocks as low as possible. Nevertheless, values continue to strengthen although some respondents believe prices may have peaked.”

MEPS added that “The Spanish market is starting to wind down sooner than usual ahead of the August holiday. Service centers claim that overall sales fell by 20% in June and that July has started off in a similar manner. Construction demand continues to reduce and, although export sales of cars are holding firm, manufacturing for the domestic market has fallen. Steel distributors are not carrying huge stocks. In fact, many are buying from each other, rather than place forward orders with the mills.”

Czech government approves settlement plan with ArcelorMittal

Bloomberg reported that Czech government approved a plan to settle a dispute with ArcelorMittal.

The report quoted Mr Miroslav Kalousek finance Minister of Czech while speaking to reporters in Prague said that “He was authorized by Cabinet to sign the necessary documents which bind the company to drop its claim against the Czech Republic. In return, the Czechs agreed to sell 1.36 million shares in ArcelorMittal's Ostrava unit to the parent company.”

The dispute was over the government's sale of a Czech steel mill to Evraz Group SA, which competes with ArcelorMittal.

ArcelorMittal claimed it was due damages because it was excluded from the competition.

Voestalpine sees no downturn in steel industry before year end

Mr Wolfgang Eder CEO of voestalpine AG said that he does not expect a downturn in the steel industry before the end of the year but actually anticipates an increase in demand in Central and Southeastern Europe.

Mr Eder told the Viennese daily Wiener Zeitung in an interview that "Up to the end of this year at least I do not expect any signs whatsoever of a downturn in the steel industry.”

He added that "In fact, state run infrastructure projects in Central and Eastern Europe are not dependent on economic situation.”

On a different note, Mr Eder underscored voestalpine's plans to build a EUR 5 billion steel plant on the Black Sea by 2013 and said a decision on its location will be made by autumn. According to Mr Eder, around 23 million tonnes of steel are used annually in the Black Sea region and by 2015 this is expected to double to more than 50 million.

LME commences steel billet spot trading

The London Metal Exchange has commenced spot or cash trading, marking the end of the launch period for both the Mediterranean and Far East LME steel billet futures contracts.

The first cash dates falling due provide the steel billet industry with access to valuable daily spot reference prices and offers market participants the full flexibility of a range of daily trading dates out to 3 months.

Steel billet futures can now be traded every business day out to 3 months, then weekly, every Wednesday of the week, months 3 to 6, then monthly, every 3rd Wednesday of the month, months 7 to 15.

Ms Liz Milan commercial director of LME said that “For the first time in the history of the steel billet industry the physical market will have access to a transparent exchange traded spot price. This marks the end of the launch period for the contracts, and the start of their development as fully fledged LME contracts.”

Since launch the contracts have traded over 122,000 tonnes with a turnover in excess of USD 129 million.

Acepar and Acerin to sign supply agreement this week

BNamericas reported that Paraguayan steelmaker Acepar plans to sign an agreement this week with local company Acerín to supply the latter with billets.

Mr Roberto Daher manager of Acerín told BNamericas that "Most of the details have already been finalized. We are waiting to see if Acepar has any objections to the proposals we made and regarding the way we will operate.”

The companies signed a letter of intent in June for the supply of billets that will allow Acerín to resume rebar production.

It said that the company needs roughly 1,500 tonne per months of billets for rebar manufacturing in order to supply 30% of the domestic construction market.

Although the agreement is close to becoming official, Mr Daher said that the company does not want to rush the issue of investments until the first part of reactivation is formalized. He said that Acerín does need investments to boost capacity and production at the plant but "we are not going to issue any information about that until the plant is reactivated.”

The executive said that once the contract is signed Acerín will have 30 days to assess the plant's status and then another three months in which to begin operating.

Nippon Steel restarts steel output at Kamaishi

Reuters reported that Nippon Steel Corp has restarted steel output at its Kamaishi Works in northern Japan, after halting production for inspections following a strong earthquake.

But the 149 MW coal fired power plant at the same facility remained shut for an inspection. It supplies all the power output from the plant to Tohoku Electric Power Co.

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Lion Group and Vinashin to build USD 3 billion Vietnam plant

Dau Tu without saying where it got the information reported that a unit of Malaysia's Lion Group and Vietnam's Shipbuilding Industry Group is seeking permission from the Vietnamese government to build a USD 3 billion steel plant.

The paper said that the mill, planned in the southern coastal province of Ninh Thuan, will have an initial capacity of 4.5 million tonne a year, which will be increased to 10 million tonne by 2025.

It said that Vinashin as Shipbuilding Industry is known, plans to hold a 30% stake in the project.

Japan may reduce welded tube exports to US in Q4

It is reported that Japan’s carbon steel welded tube export quantity to the US, such as line pipe, may decrease in the fourth quarter and Japan’s pipe producers are cautious to enter into negotiations over the export price to the US.

As per report Japan’s welded pipe exported to US in the first quarter was USD 900 per ton FOB; USD 1,000 per ton FOB in the second quarter and the delivered price in September was USD 1,500 to USD 1,600 per ton. As US welded tube used in energy sources request increased, Japan’s pipe export price rose accordingly.

Besides, there is a good chance for Japanese producers to increase sales as China’s welded pipe exits from the US market due to China products facing an anti-dumping investigation in the second half of last year. Japan’s export price in the fourth quarter is expected to reach FOB USD 1,800 per ton.

Japan exported 97,207 tons of welded pipe to the US from January to May 2008. As the quantity exported to the US has risen greatly, Japanese producers worry about complaints from local manufacturer and may take some remedial measures, so Japanese producers could drop the quantity exported.

According to Japan’s steel industry, Japan’s welded pipe prices are USD 200 per ton higher than South Korean and Chinese prices due to disparities of quality and usage.

ArcelorMittal Tubarao upgrades BetaPlanner HSM in Brazil

ArcelorMittal Tubarao has upgraded BetaPlanner solution for the optimization of the detailed scheduling of its Hot Strip Mill.

BetaPlanner, AIS’ leading solution for the short term detailed scheduling optimization of all rolling mills, was implemented in 2002, in Tubarão.

The solution was even ready before the mill was built, first kind of implementation in AI Systems experience in collaboration with ArcelorMittal experts. Since then, the plant has gone through several expansions. The range of products has increased, as well as the market requirements for always better quality. The rolling practices become more exigent on scheduling rules and service is a priority. AI Systems has assisted ArcelorMittal Tubarão in the revision of the scheduling rules formulation and the parameterisation of the BetaPlanner to satisfy these requirements.

Mr Ivo Abrahão Project Coordinator said that “The strong standards of AMT’s Quality System for scheduling rules, combined with a long term relationship with AIS experts have lead to a successful project achievement. Thanks to the high configurability of BetaPlanner, we were able to manage the IS Advanced Information Systems challenges of making good schedules, respect due dates and keep inventories low with the same software by simply adapting and configuring new production rules”.

Mr Robson Ribeiro Moyzes production planning and scheduling manager comments that “Our policy is to be at the edge of the technology to ensure the maximal quality and service to our clients.”

Modernization of the foundry at Diehl Metall Messing

Diehl Metall Messing, Röthenbach an der Pegnitz of Germany has placed an order with SMS Meer for the supply, erection and commissioning of a new vertical continuous three strand caster for the production of brass billets.

With this investment, Diehl Metall Messing plans to replace the existing two strand caster and hence safeguard the long term competitiveness of the company.

The new continuous caster will satisfy modern production demands and is characterized by a high degree of automation and minimum maintenance. In order to minimize the standstill time between dismantling of the old plant and the start up of full production again, erection and commissioning of the new plant will be carried out during the works closure in summer 2009.

Diehl Metall Messing is a subsidiary of the Diehl Group with its worldwide activities and with an annual capacity of 125,000 tonne of brass bars, hollow bars and profiles is one of Europe’s leading manufacturers in this segment.

SKW Stahl Metallurgie Stahl reports Q2 results

Bloomberg reported that SKW Stahl Metallurgie Holding AG had a record gain in Frankfurt trading after reporting higher second quarter profit.

As per report SKW jumped by EUR 3.53 or 20%to EUR 21.20 the steepest increase since its initial public offering in December 2006.

SKW in a statement said that EBITDA climbed to EUR 9.5 million from EUR 5.2 million a year earlier and sales advanced by 83% to EUR 102.3 million.

US rebar price to keep climbing

Although the domestic demand from US end users is not strong, a combination of low inventory in local steel mills, the strong global demand and domestic prices that are lower than the import price, are causing the US rebar price to keep climbing higher.

Macsteel International USA, the steel long product distributor said that the supply shortage situation in steel long products will continue until the fourth quarter of 2008; therefore, rising energy and raw material cost will lead US domestic steel mills to pass along their cost to the end users.

Market participants projected that rebar price will keep rising during the rest of this year.

(Sourced from YIEH.com)

Western Extrusions orders aluminum extrusion press

Texas based Western Extrusions Corp has placed an order with SMS Meer for the supply of a 75/80 million aluminum extrusion press. The Schloemann front loading press has an extrusion force of 8,000 t and a billet charge weight of up to 630 kilogram and is the largest machine of this kind that SMS Meer has built to date in North America. It will be used for the production of high quality extruded aluminum profiles for the transport and automotive industry.

The extrusion press ordered from SMS Meer will be built as a shortstroke front loading press. In the meantime front loading presses have established themselves as the standard on the extrusion press market. The advantages of this design are the compact, sturdy frame and the short cylinder strokes with the associated high productivity thanks to short idle times and the high product quality thanks to the centric loading of the aluminum billet inside the press. The new extrusion press is scheduled to go into operation in spring 2010.

Western Extrusions is thereby expanding its product spectrum and strengthening its market position. The company was founded back in 1979, is still family owned even today and has 600 employees. Western Extrusions is one of the leading producers of extruded profiles for use in the construction sector, transport and industry. Western Extrusions is, for example, one of the largest manufacturers of aluminum seats for sports stadium.

Ninh Thuan to develop seaports and wind power

VietNamNet Bridge reported that Mr Nguyen Tan Dung PM of Vietnam has asked central Ninh Thuan Province to develop wind power, industrial salt production, seaports and heavy industrial zones to increase its economic growth.

Mr Dung said that Ninh Thuan Province has good potential for developing seaports, steel and titanium projects, industrial salt production, wind and nuclear power.

While working with local authorities on July 23 regarding the province’s socio economic performance in the first half of the year and its tasks in the second half, Mr Dung said that the Government will create favorable conditions for Ninh Thuan Province, where the number of poor households remain high, to make full use of its potentials.

Mr Dung added that Ninh Thuan Province has good potential for developing seaports, steel and titanium projects, industrial salt production, wind and nuclear power adding that the matter is how to implement these projects efficiently.

He asked ministries and agencies to assist Ninh Thuan Province in planning its coastal roads and seaports, with focus on environmental improvement and tourism.

He also assigned the Ministry of Natural Resources and Environment to conduct surveys on titanium reserve in the locality to work out an exploration and processing project to ensure a strict management of this kind of mineral resource.

Claymont Steel announces extension of expiration date

Claymont Steel Inc announced that the expiration date for its previously announced cash tender offer for any and all of its outstanding 8.875% Senior Notes due 2015 has been extended to August 1st 2008. The early tender on July 24th 2008, remains unchanged.

The Company has elected to forego its option to settle Notes validly tendered prior to the early tender date on an early settlement date.

Except as described above, all other terms and conditions of the tender offer remain in full force and effect. Consummation of the tender offer is subject to the satisfaction or waiver of certain conditions, including but not limited to a financing condition. Consummation of the tender offer is not conditioned upon receipt of any minimum principal amount of the Notes.

RBS Greenwich Capital is acting as dealer manager for the tender offer. The information agent and depositary for the tender offer is DF King & Co Inc.

ABB Q2 net income up by 34% on strong top line growth

ABB reported record orders, revenues and earnings before interest and taxes in the second quarter of 2008, with net income reaching USD 975 million. Global demand for ABB’s core technologies to provide reliable electrical power and improved industrial efficiency remained robust, while ongoing operational improvements contributed to increased profitability.

ABB’s EBIT reached USD 1.4 billion up by 42% YoY. The EBIT margin increased to 16.1% from 14.4% in the second quarter of 2007 as ABB continued to benefit from high capacity utilization, greater sourcing of components from emerging economies and other operational improvements. Its orders increased in all divisions in a strong market and were up by 31%to a single quarter record of USD 11.3 billion. It was also the first quarter in which orders from emerging markets exceeded orders from the mature economies1, accounting for 51 percent of total orders received.

Revenues increased by 27% to USD 9 billion. Utilities continued to invest in new and refurbished power infrastructure while industrial customers, especially in the oil and gas, marine and minerals sectors, further expanded capacity. The need for more energy efficient industrial technologies to meet the challenges of rising energy and raw materials costs also continued to drive growth.

Mr Michel Demare CEO &CFO of ABB said that “This was a record quarter for ABB. Global demand for our market leading technologies in power infrastructure, energy efficiency and industrial productivity remained at high levels. Our strong market positions in both the emerging and mature economies continue to provide us with excellent organic growth opportunities. At the same time, we continue to improve our profitability and total return on capital through measures such as better project execution and risk management, lower cost sourcing, and footprint optimization.”

ArcelorMittal acquires stake in service center network in Brazil

ArcelorMittal has acquired a 70% share of Manchester Tubos e Perfilados S.A, the Brazilian steel processor and distributor located in Contagem, Minas Gerais.

Manchester was founded in 1989 and is privately owned. It serves the construction segment, which represents 50% of its activity, as well as the industry and automotive segments. Its capacity is 240,000 tonnes per year for end products, and 60,000 tonnes per year for processed products like cut to length and slit products. 2007 net sales were BRR 270 million. The company employs 500 people.

This new acquisition will reinforce ArcelorMittal's downstream position in Brazil, following the acquisition on April 3rd of a 50% stake in Gonvarri Brasil. With the acquisition of Manchester, and with its partnership with Gonvarri, ArcelorMittal will widen its product offering in the distribution segment in Brazil. The Group will now offer an extended range of flat products including coils and blanks, profiles, tubes and pipes.

Mr Michel Wurth member of the Group Management Board and in charge of Steel Solutions and Services said “From this new location, ArcelorMittal will target the construction market. Penetrating this fast growing market with a diversified offer, from tubes to structural profiles, is considered as a great opportunity for the Group."

Kuwait to increase subsidies on steel and cement

The Kuwaiti government has increased subsidies on basic food and construction items, and vowed to clamp on price gouging to offset the impact of record inflation.

The commerce and industry ministry in a statement said that Kuwaiti government will increase subsidies and distribution of steel and cement.

Annual inflation in Kuwait jumped to a record 11.4% in April, accelerating for a fifth straight month as high housing and food costs continued to spur price rises in the Gulf oil producer.

Ezz Steel production in H1 remains flat YoY

Arab Steel reported that production of Egypt’s largest steel producer Ezz Steel in H1 of 2008 amounted to 2.389 million tonnes, including 1.5 million tonnes of long products and 858,000 tonnes of flat products, up by 0.6% YoY as compared to 2.375 million tonnes in the first half of 2007.

Its sales in the first half of 2008 amounted to 2.457 million tonnes as compared to 2.465 million tonnes in the same period of 2007. A small increase is noticed in the company's sales of long products to the domestic market by 7%, while exports of long products declined by 87%; they amounted to 24,000 tonnes as compared to 184,000 tonnes in the same period of 2007. This would probably have been due to two factors, the increasing demand in the domestic market and imposing a governmental tax on exports, which resulted in the decline of exports.

During the first half of 2008 the Egyptian market witnessed an increase in consumption, in particular in long products whose volume amounted to 2.419 million tonnes, that is, at a growth rate of 19% over the level of the same period in 2007 during which the consumption volume amounted to 2.041 million tonnes while the flat products maintained the same consumption level which amounted to 535 thousand tonnes.

As per the report Ezz Steel's sales to the domestic market during the first half of 2008 covered 62.7% of the total consumption of the market of long products and 67% of flat products.

Markets of the Middle East and North Africa are the major markets for Ezz Steel's sales of long products while the European market takes 57% of the total exports of the company of flats.

General Holding orders for second ENERGIRON DR module

Tenova HYL announced that it has completed the licensing agreement and work is now underway for the second ENERGIRON direct reduction plant at the new General Holding Corporation facility at Abu Dhabi in UAE.

GHC is currently building a new steelmaking complex that will produce 1.4 million tonne per year of long products. The complex is being installed at Mussafah and includes a 1.6 million tonne per year ENERGIRON DR plant being supplied by Danieli and Tenova HYL.

The ENERGIRON plant is part of a turnkey steel mill complex for which Danieli is the EPC contractor. The DR plant will transport hot DRI to the electric furnace meltshop using the highly successful HYL HYTEMP Pneumatic Transport System.

The second stage of the GHC project, now under construction too will be a copy of the first stage, including a new DR module and HYTEMP System. Startup of the first stage of the GHC complex is expected in early 2009 and completion of the second stage project is planned for 2011. Upon completion, GHC will have 3.2 million tonne per year of hot DRI capacity for steelmaking.

ENERGIRON is the innovative direct reduction technology jointly developed and marketed by Tenova HYL and Danieli & Co. Through more than 50 years of research and development and industrial application, the technology has evolved into what is today the most flexible and economical direct reduction technology in the industry.

Rio Abu Dhabi aluminum smelter shelved on gas non availability

Arabianbusiness.com reported that a planned USD 43 billion smelter in Abu Dhabi has been declared dead after Rio Tinto said the UAE had decided to use its natural gas in more profitable industries.

Mr Dick Evans CEO of Rio Tinto’s aluminum unit said that Middle Eastern nations are using their gas in the chemical, fertilizer and liquefied natural gas industries to benefit more from their reserves. The shift is reducing supplies available to the energy intensive aluminum industry. Abu Dhabi is for all practical purposes dead at this point and we don’t see it coming back. That is because of this policy shift and how the emirates are seeing the use of their gas.”

Mr Nick Cobban Rio spokesman in May said that the project was on hold while the government reviewed its energy requirements.

Mr Jim White COO of Abu Dhabi Basic Industries Corp said in October the smelter there would be able to produce about 700,000 tonnes a year at a cost of USD 3 billion.

Samsung Heavy builds the world's largest LNG carrier

Samsung Heavy Industries announced that it had held a naming ceremony for the world’s largest liquefied natural gas carrier, a 266,000 cubic meter.

Samsung Heavy Industries won the USD 290 million order to build the LNG carrier in March 2006 which at the time was the largest ever contract in the shipbuilding industry. The carrier was under construction for a period of 28 months. It was named Mozah, after Qatar’s Queen.

The carrier, which is 345 meters long, 54 meters wide and 27 meters high, can carry 266,000 cubic meter of LNG at a speed of 19.5 knots. The carrier has two engines and shafts for maximum propulsion safety. SHI has also maximized the load capacity of the LNG carrier, as the new carrier can carry 50,000 cubic meter more gas than the 217,000 cubic meter LNG carrier, which was previous the largest LNG carrier in existence.

While most LNG carriers use natural gas that is liquefied in the cargo hold as fuel, the new carrier puts the liquefied natural gas into the cargo hold through a liquefying facility and uses Bunker C oil as fuel. This is referred to as the low speed diesel engine method. This enhances the drive efficiency of the carrier by 40%, reducing fuel costs by KRW 50 billion based on the ship having a life expectancy of 25 years. Indeed, it is a highly economical ship in this era of high oil prices.

The ship carries natural gas that is condensed into a liquid form that is 1/600th of its original volume at atmospheric pressure and is cooled to approximately &min;163 degrees Celsius. The client entrusted SHI to handle as much as 20% of the total of 10,000 times of inspection during the construction process. This indeed shows the client’s confidence in the quality of SHIs technology.

The LNG carrier will be transferred to Qatar at the end of August, and will supply gas produced in the gas fields north of Qatar to the United States and Europe 12 times per year. SHI will deliver an additional 10 LNG carriers of the same size to Qatar by 2010.

Qatar is projected to grow to become the world’s largest producer of LNG by 2010, with an anticipated LNG production capacity of 80 million tons. Qatar has ordered 45 LNG carriers from three Korean shipyards, including Samsung Heavy Industries, Daewoo Shipbuilding and Marine Engineering, and Hyundai Heavy Industries, each capable of carrying more than 200,000 cubic meters. Of these 45 carriers, SHI has won 18 of the orders.

Abu Dhabi begins construction on longest tunnel in Middle East

Arabian Business reported that construction has begun in Abu Dhabi on what will likely be the Middle East’s longest road tunnel, stretching 3 kilometers under the UAE capital.

According to the report the tunnel will run 15 meters underground below Al Salam Street from Abu Dhabi’s northeast entrance to near Port Zayed and is expected to divert a significant amount of traffic from the congested city centre.

Earlier UAE daily Emirates Business 24/7 citing Abu Dhabi Municipality Director General Jumma Al Junaibi as saying that the tunnel, which is expected to be finished in 2011, will have four lanes in each direction and include state of the art safety, monitoring and control systems.

It is part of an AED 3 billion infrastructure project that also includes construction of a 500 meter flyover connecting the city to Reem Island, which is undergoing extensive redevelopment.

Dogus and Krone build new trailer facility in Turkey

Turkish Daily News reported that German Krone and Turkish Doğuş Otomotiv are collaborating for the establishment of the country's largest trailer production facility in the Aegean city of İzmir. The factory, which is expected to employ 400 people, will export 80% of its products

A major player in the Turkish automotive sector has made an agreement with Europe's second largest trailer producer for the establishment of Turkey's largest trailer production facility.

According to the reports, the Krone Doğuş trailer factory, which will start operating in 2009 based on an investment of EUR 35 million, is expected to produce 3,115 trailers in its first year. The production capacity of the facility will be 10,000 trailers and 80% of the production will be for exports. The factory will provide job opportunities for 400 people. As per the report, the factory with its product range consisting of Mega Liner and Profi Liner trailers, will export to Russia, the Middle East, Turkic republics and southeastern Europe. The facility will produce trailers in any color the customer wants.

Mr Jürgen Föhrenbach chairman of Krone said that the foundations for the facility, the result of a partnership between German company Krone and Doğuş Otomotiv which is the flagship company of the Doğuş Group's automotive wing were laid recently in the Aegean city of İzmir's tire industrial zone. He also said that investment is a challenge to the world.

Mr Föhrenbach said that we reached an agreement following a negotiation period of a half hour, adding that Turkey has advantages such as technological excellence and low production cost. That is why we are here. Mr Föhrenbach, describing the new tire factory as ultra modern, emphasized that the location is at the heart of promising markets such as the Black Sea, near east and northern Africa.

Krone was founded in the German municipality of Spelle by Bernard Krone in 1906. The firm, which has production facilities in Germany and Denmark, reaped 1.2 billion euros in turnover during the 2006-2007 financial year. During the first six months of the 2007-2008 financial year, the firm raised its turnover to 1.4 billion euros.

OPEC to hold an extraordinary meeting in December

Iranian Press TV reported that the Organization of Petroleum Exporting Countries will hold an extraordinary meeting in Algeria in December.

As per report the December 17th meeting will be held on a ministerial level. Algeria currently holds the rotating presidency of the organization.

OPEC, which supplies about 40% of world's oil, is scheduled to hold its regular meeting in Vienna on September 9th to discuss its oil output policy.

According to one source, the Algerian city of Oran will host the OPEC December meeting.

Iran wants supertanker to store crude

Exim News Service reported that Iran is reportedly seeking a double hulled supertanker to store crude oil for up to 60 days.

Shipbrokers said that National Iranian Tanker Company was seeking a very large crude carrier capable of storing up to 280,000 tonnes of oil for delivery between August 2nd and August 3rd.

As per the report, Iran had been storing about 30 million barrels of crude in oil tankers anchored just outside Kharg Island a key crude export terminal due to a heavy European refinery maintenance schedule. It was not immediately clear how many tankers Iran was using as floating storage.

Gulf states to accumulate USD 4 trillion by 2015

Deutsche Bank said that Gulf OPEC members will accumulate net foreign assets of USD 4 trillion by 2015 if oil stays near today’s prices. It also said that the reserves will rise from the current USD 1.2 trillion if the price of oil averages USD 114.4 per barrel. By comparison, the UK’s gross domestic product, the fifth largest in the world, was USD 2.38 billion last year.

Ms Caroline Grady London based Gulf economist for Deutsche said that asset accumulation of this magnitude is unprecedented in the region, reflecting the fact that between 1970 and 2007 oil prices averaged USD 24.5 per barrel.

Deutsche added that record oil prices will allow Gulf States to save more this year than ever before even as spending increases, filling the coffers of their sovereign wealth funds and providing a cushion should the price of crude fall in the future. Saudi Arabia, the largest Arab economy, needs an oil price of USD 44 a barrel to avoid a fiscal deficit this year, the highest breakeven level among GCC Organization of Petroleum Exporting Countries. The breakeven price for the UAE is USD 40 per barrel, Qatar is USD 35 and Kuwait is USD 14.50.

Ms Grady added that breakeven oil prices have increased in line with rising expenditure levels as the oil boom is increasingly viewed as permanent. The price of crude has increased 68% in the last 12 months, and has averaged USD 114.05 so far this year compared with USD 72.36 in 2007.

Ms Grady further added that our rule of thumb is that every USD 1 per barrel increase in the oil price adds another USD 3.5 billion annually to the GCC OPEC net foreign assets with Saudi accounting for around two thirds.

Japan offers to install 500MW power plants in Pakistan

The News reported that Japanese government offered Pakistan installation of two 500 MW power plants and showed interest in increasing investment in the automobile industry, while Islamabad assured Tokyo of establishment of Special Economic Zone for Japanese investors on priority basis, which would be equipped with basic infrastructure.

Mr Syed Naveed Qamar Federal Minister for Finance, Privatization & Investment assured this in a meeting with a visiting 15 member Pakistan Japan Business Forum delegation led by Mr Makoto Kakebayashi held here on Wednesday.

The minister also directed the Board of Investment to work together with the Pakistan Japan Business Forum in knuckling down to study to find out the impediments being faced by the investors in general and the Japanese investors, in particular. He also added that a workable report should also be prepared in the light of this study suggesting remedial measures to remove all sort of hindrances and bottlenecks and all out efforts should be made to encourage the Japanese business sector to enhance operations and investment in the country.

NIOOC oil fields output exceeds 723,000 BPD

MNA reported that National Iranian Offshore Oil Company produced averagely 723,000 barrels of crude oil per day in Iranian months of Khordad and Tir from its Persian Gulf oil fields.

According to the report NIOOC, a subsidiary of National Iranian Oil Company, mainly extracts oil from Kharg, Behregan, Siri and Lavan oil regions. It has currently 6 operational oil terminals and in near future Lavan and Siri oil terminals will come on stream, too.

As per the report the company’s in situ oil and gas reserve is about 91 billion barrels of oil and 173 trillion cubic feet of gas.

Iran to double aluminum production capacity by March 2009

MNA quoted Iran’s aluminum production capacity will be doubled by the end of the current Iranian calendar year (March 20th 2009)

The report quoted Mr Harati Nik MD of Iranian Mines and Mining Industries Development and Renovation Organization as saying that by launching aluminum production plants in the cities of Arak and Bandar Abbas, 240,000 tonne will be added to the country’s annual aluminum production capacity, reaching up to 500,000 tonne a year.

Techno Valley project takes off in Riyadh

Arab News reported that King Saud University in Riyadh has crossed a new milestone in its efforts to develop a knowledge society with the launch of its Riyadh Techno Valley project. Acting Riyadh Gov. Prince Sattam laid the foundation stone for RTV's first tower on the campus on Tuesday night.

Mr Abdullah Al Othman, president of the university said that the project is aimed at achieving knowledge excellence and promoting cooperation with the private sector to carry out major research work. He added that our university wants to play a pioneering role in creating a knowledge society.

Mr Al Othman said that we want to create a conducive atmosphere for research and development in order to achieve sustained progress for the Kingdom and strengthen the competitive edge of the national economy based on knowledge. He also added that the KSU would continue its efforts to meet the educational, scientific and developmental requirements of Saudi society.

Mr Al Othman said through the techno valley project, the university aims to satisfy the demands of knowledge based industries and to commercialize its research outcomes, in addition to enhancing the research environment and encouraging researchers and graduates to participate in the incubation program and to establish spin off companies.

He said that the KSU has established a special agency for knowledge exchange and technology transfer. He added that the agency has launched a number of programs to boost scientific research, especially in nanotechnology and biotechnology.

Hydra begins excavation at Downtown Tower in Dubai

Khaleej Times reported that Hydra Properties, the leading UAE based international property developer has fast tracked its prestigious Hydra Downtown Tower project located at the Shaikh Zayed Road in Dubai by beginning excavation and piling work for the project.

Dr Sulaiman Al Fahim CEO of Hydra Properties said that Hydra Downtown Tower is all set to redefine the glorious skyline of Dubai. It will stand apart among the constellation of structures that is rising in Downtown Dubai by its trend setting design. The tower has attracted a tremendous amount of response from investors, regionally and globally and we, at Hydra Properties, are devoting our energy and expertise to the successful completion of the project.

NEPRA directs KESC to submit investment plan

The News reported that National Electric Power Regulatory Authority has constituted a committee to scrutinize Karachi Electric Supply Company matters and bring improvement in its services.

NEPRA being aware that the KESC being an integrated utility supplying power under a monopoly license to a service area of some 6,000 square kilometers in and around Karachi, is plagued with power outages of large magnitude resulting in huge economic losses to the national exchequer as well as end consumers. Bringing improvement in the services of KESC, being a privatized entity, will impact future privatization and roadmap of private power regulated by NEPRA.

NEPRA in this respect has asked KESC to comply with Section 21 (h) and Section 32 of the NEPRA Act whereby power acquisition and investment program are to be submitted to NEPRA and subsequently placed before the consumers.

NEPRA being a regulatory authority is mandated to ensure mandatory improvement to levy fines, etc, for non compliance. NEPRA, however, as a first step, is placing emphasis on ensuring compliance with the Articles of the Generation and Distribution License as these articles require submission of generation availability and investment plans for prior approval.

NEPRA with this tightening of regulatory control expects to bring improvements in KESC services and to assist KESC in seeking various official approvals with the regulator’s backing. The same will help both KESC and the consumers in overcoming the power crisis.

Hebei Steel Group produces 17.29 million tonnes of steel in H1

According to China local Metallurgical Industry Association, Hebei Iron & Steel Group has produced 15.04 million tonnes of hot metal, 17.29 million tonnes of crude steel and 15.56 million tonnes of finished products in the first half of this year up by 1.96 million tonnes YoY, 2 million tonnes YoY and 1.65 million tonnes YoY respectively.

Hebei Iron & Steel Group produced 2.58 million tonnes of hot metal, 3.02 million tonnes of crude steel and 2.74 million tonnes of finished products in June 2008.

During H1, it produced 780,600 tonnes of extra heavy plate, 1.03 million tonnes of heavy plate and 246,000 tonnes of heavy sections in the time frame, up 111,500 tonnes, 67,300 tonne and 12,300 tonnes respectively over last year.

Hebei Steel Group, a result of merger of Tangshan Steel Group and Handan Steel Group has officially started operations since the end of June 2008, and the steel group's crude steel capacity has reached 31 million tonnes per annum overtaking that of Shanghai based giant Baosteel and accounting for 29% of Hebei's total crude steel output.

NDRC approves VLOC berth in Lianyungang Port

It is reported that China's National Development and Reform Commission has approved a project of building 250,000 tonne ore port for very large ore carrier in Liaoyungang Port.

As per report, with one unloading berth and the supporting facilities, the project is designed to gain a capacity of unloading and storing as 120 million tonnes in initial stage and then as 150 million tonnes in future.

The project would need about CNY 1593 million investments.

After completion, the new port will largely release the transporting pressure in Lianyungang Port.

Masteel reduces ex work price of H sections for August

Masteel announced on July 21st 2008 that it’s ex work price of H-sections for August has been decreased.

Price of 200x200H reduced by CNY 200 per tonne to CNY 4820 per tonne and CNY 5639 per tonne including taxes.

Price of 400x400H reduced CNY 50 per tonne to CNY 5570 per tonne per tonne and CNY 6517 including taxes.

One merchant in Shanghai said the sales since July dropped due to the high temperature impacts the project construction and the tight capital pressure of downstream enterprises.

Market price of small sections in Shanghai dropped recently, price of 200x200H dropped by CNY 50 per tonne than July 9th and the mainstream price was CNY 5550 per tonne and some offered the price of CNY 5550 per tonne. Market price was still higher than ex work price even steel mills reduced price.

Therefore, merchants are not willing to sell goods in low price. Some merchants believe price this week will drop again and they are eager to collect capitals during the order time.

Billet market in Tangshan down slightly

It is reported that square billet market price dropped slightly on July 23rd in Tangshan.

The mainstream quotation at the current market has dropped by CNY 30 per tonne. Price of carbon 150 billets in Tangshan at present was CNY 5350 per tonne, CNY 5400 per tonne for triangle 165 billets and CNY 5500 per tonne for low alloy billet.

As per report, billet delivery of most steel mills in Tangshan was not good due to the environment protection and transportation restriction during Olympic Games. The billet demand also slowed down than earlier. Steel mills faced great pressure to reduce price gaining more orders. Square billet market in Tangshan predicted to have a slight adjustment later.

General Steel acquires Maoming Hengda Steel

General Steel Holdings Inc announced that it has acquired 99% of Maoming Hengda Steel Group Ltd a steel products processor located at Maoming city, Guangdong province in China's southern coastal region.

General Steel Holdings entered into the purchase agreement with Hengda on June 25, 2008. Through its subsidiary, Qiu Steel Investment, Ltd General Steel paid MYR 50 million cash to purchase the company from private parties.

Minmetals expect net profit in H1 to rise by 100%

It is reported that Minmetals Development Co expected its H1 2008 net profit to show a rise of at least 200% buoyed by expansion of its business.

The firm, controlled by China Minmetals, said that its earnings were boosted by the acquisition of a steel plate producer in northeast China through a rights offer. It booked a net profit of CNY 385.05 million in the first six month of 2007.

As per report, the estimate for the first half was based on unaudited figures. Listed Chinese companies are required to issue preliminary estimates if they expect earnings for rise or fall more than 50%.

Minmetals Development said detailed first half figures would be released in its interim report.

Sichuan Hongda sees H1 net down by 95% YoY

Reuters reported that China's Sichuan Hongda Co net profit in H1 2008 would fall at least 95% YoY to 98% YoY due to a shutdown caused by a devastating earthquake in May.

China's Sichuan Hongda Co in a statement filed to the Shanghai Stock Exchange said that the company's operations have not yet fully returned to normal after the earthquake on May 12 forced its subsidiaries in southwest China's Sichuan province to halt production.

The statement said the quake caused direct economic losses of CNY 160.2 for the company. It said a sharp decline in zinc prices in China has also eroded the company's profit margin.

Zinc futures on the Shanghai Futures Exchange have tumbled, with the price of the most-active contract down 46% over the past 12 months.

Sinosteel Tianyuan Branch net profit in H1 dips by 26.57%

It is reported that Sinosteel Anhui Tianyuan Technology Co Ltd recently report its net profit in H1 2008 shrinks 26.57% due to the climbing cost.

Tianyuan totally gained CNY 200.8 million as the gross revenue in H1 up by 54.45% YoY. However, subtracting the swelling cost caused by steep raw material price and labor cost, the company only gained CNY 897,600 down by 76.02% YoY. Net profit presented as CNY 2.768 million down by 26.57% YoY with EPS as CNY 0.03.

ASEAN biggest destination of Guangdong's Steel products

China Business News reported that association of Southeast Asian Nations has surpassed Hong Kong to become the biggest overseas market for Guangdong's steel products.

In the first half of this year, Guangdong exported 263,000 tonnes of steel products to ASEAN down by 10.2% YoY, 25.5% lower than that of the total exports. The volume to ASEAN accounts for 26.4% of the total figure.

The province's steel exports to ASEAN surged from 20,000 tonnes in 2001 to 529,000 tonnes in 2006 with total increase of 25.5 times and annual growth of 72.6%. The products now flow into all the countries in ASEAN except Laos. Thailand is the biggest market in ASEAN, absorbing 67,000 tonnes in the first six months up by 54.4%.

According to Guangzhou customs, foreign invested enterprises are major exporters, who exported 150,000 tonnes to ASEAN in the first half, up by 47.2%. On account of government macro-control, private enterprises and state-owned enterprises exported 73,000 tonnes and 34,000 tonnes respectively, down 33.3% and 52% from last year.

Jigang Group to issue CNY 1.5 billion in short term debt

It is reported that Jigang Group, parent of Jinan Iron & Steel Co Ltd plans to issue CNY 1.5 billion worth of 365 day debt on July 28th.

Jigang Group in a statement said the yield will be determined through a book building. It said proceeds from the bond issue will supplement working capital.

Industrial and Commercial Bank of China will be the underwriter for the issue.

Desheng Steel sales revenue in H1 up by 75% YoY

It is reported that Yunnan based Desheng Iron & Steel Co Ltd has achieved sales revenue of CNY 2.85 billion in H1 of 2008 up by 75% YoY or CNY 1.22 billion from the same time last year, with value added tax of CNY 134 million up by 118.6% YoY or CNY 72.41 million over last year.

Desheng Steel was founded in August 2000 and now is the largest privately owned steel enterprise in Yunnan province, with annual production capacity of 1.5 million tonnes of iron and crude steel respectively.

East China based steel strip makers conference in Hangzhou

Secretariat of East China Steel Strip Association reported that on July 22nd members of East China Steel Strip Association got together in Hangzhou, capital of Zhejiang province discussing the market situation.

Attendees were
1. Hangzhou Relian
2. Jianlong Materials
3. Mysteel
4. Zhejiang Mingcheng
5. Xiaoshan Qianhong
6. Ningbo Xinyin
7. Hangzhou Ningfeng
8. Hangzhou Kaikai
9. Minmetals
10. Shanghai Hongyu
11. International Trade company under Hangzhou steel
12. Hangzhou Haichuang
13. Wuxi Longzhijie
14. Wuxi Longchang
15. Zhejiang Tianlei
16. Jinhua Zhejin
17. Zhejiang Materials and Ningbo Dazhong Steel Exchange
18. Hebei Jinxi steel
19. Zhongtian steel

Mr Song Hongbin deputy GM of Mysteel and secretary general of the Association presided the conference. Mr Jiang yuanqin, GM of Hangzhou Relian Import and Export Co Ltd delivered an address of welcome. Mr Liuyonghua GM of Zhejiang Jianlong Materials and Chairman of the Association gave a specific report on dealers of steel strip in East China.

Mr Zhang Jianjun pointed out that some North China based steel makers are trying to relieve the pressure of overstock by taking maintenances and even suspending production. However, over one third of downstream enterprises have stopped production and demand is too weak to digest all the output. Hence, the representative of steel makers say that producers would stick to the long term cooperation ties with traders and dealers and try their best to maintain their interests.

Mr Song Hongbin made an in depth analysis on market situation, reasons for steel price increase and current problems, which could be reduced to be following six points:
1. Sky high prices.
2. High inventory level. Traders are not willing to work off inventory at lower levels due to their high buying cost. The stock in Wuxi and Ningbo reached 650,000 tonnes and 200,000 tonnes respectively.
3. High threshold of bank loan. Most small and medium sized companies could not enough capital under the tight credit policy.
4. Labor cost is on the rise.
5. Fierce competition among downstream users leads to weak price negotiation ability with steel mills.
6. Those steel mills who have arranged maintenances started to resume production and there will be possible pressure of high stock level in August or September.

According to the report, in the end they have come to terms on how to work off high inventory reducing the order tonnage from steel makes so as to relieve the market pressure. As steel strip price in East China are relatively lower than that in other area of the country and there is no great room for further decrease.

(Sourced from MySteel.net)

Sinosteel Futures sets office in Chongqing

It is reported that Sinosteel Futures Co Ltd, a subsidiary of Sinosteel, recently sets division of business in Chongqing.

In order to make preparation for steel futures, which is hopefully to be unveiled at the end of this year, Sinosteel has formed Sinosteel Future to create and manage sale departments around China.

Mr Li Tao GM of Chongqing sale department said that "Up to now, we have set 6 offices in Beijing, Shanghai, Dalian, Wuhan, Nanjing and Chongqing."

Mr Wang appointed as chairman of the Board of Ningxia Heng Li Steel

Ningxia Heng Li Steel Wire Rope Co Ltd announced that the Company has named Mr Wang Dongming as Chairman of the Board to replace Mr Zhang Jinghua.

Mr Wenduan appointed as GM of China Steel Structure

China Steel Structure Co Ltd announced that it has appointed Mr Chen Wenduan as GM in the Company, replacing Mr Su Xuanjiu effective August 1st 2008.

Chinese rebar and wire rod export price decrease

It is reported that Chinese domestic construction steel market is quiet this week and export prices have seen evident decrease.

Taking Shanghai price for HRB335 20mm rebar as benchmark, the strength to initiate another round of increase will not disappear as long as it is above CNY 4900 per tonne. But the downward correction is expected to sustain for another 2 to 3 weeks.

Export offers for rebar have dropped by about USD 30 per tonne to USD 40 per tonne to USD 1040 per tonne to USD 1050 per tonne FOB and those with boron is about USD 980 per tonne FOB. Offers for BS grade rebar to Middle East are enjoying higher level of USD 1250 per tonne to USD 1300 per tonne CFR. Quotations for wire rod with boron is being exported at USD 980 per tonne to USD 990 per tonne FOB up and offers for material without boron are at between USD 1100 per tonne FOB to USD 1120 per tonne FOB.

(Sourced from MySteel.net)

Chinese HRC export prices still weak

It is reported that Chinese hot rolled steel exports are still slow and there is little transaction at moment. Less demand in low season and decrease in domestic market prices are believed to be major reasons.

Domestic HRC prices are still on the decrease. On Shanghai market, commercial 4.75mm to 12mm*1500mm HRC goes at CNY 5680 per tonne to CNY 5720 per tonne down by CNY 90 per tonne to CNY 100 per tonne WoW. That for 1800mm wide cargo goes at CNY 6150 per tonne down by CNY 70 per tonne from last week. However, price for commodity grade 2.75mm HRC goes at CNY 6300 per tonne up by CNY 50 per tonne from early this week.

Taking Shanghai price for commercial 4.75mm to 12mm*1500mm HRC as benchmark, there would be no room for increase unless it could not exceed CNY 6000 per tonne. It probably would keep fluctuating between CNY 5500 per tonne to CNY 6000 per tonne.

Export offers for commodity grade HRC are prevailing at USD 1020 per tonne FOB but there is few contracts this week as many are afraid of possible drop in the near future.

(Sourced from MySteel.net)

Output of rebar in China by province in H1 of 2008

It is reported that rebar production in June 2008 total 8.15 million tonnes down by 1.2% YoY as compare to 8.25 million tonnes in 2007 and the production in H1 2008 total 47.41 million tonnes down by -1.1% YoY as compared to 47.94 million tonnes in 2007.

In million tonnes

(Sourced from MySteel.net)

Chinese mill making low offers for HRC in EU

During last 10 days to 15 days, a quite decent tonnage of HRC in commercial qualities, for pipe making and cold rolling, have been offered by 2nd and 3rd tier Chinese steel mills.

Price were ranging between USD 1030 per tonne to USD 1060 per tonne CFR FO one main European Port like Bilbao, Antwerp and Ravenna, with payment term of LC at sight.

Customer’s reaction had been, at first sight, quite positive, with few of them taking in serious consideration booking some tonnage. However with days passing on, was becoming quite clear that these offers were definitely still negotiable at cheaper prices and thus all customers changed mind switching to a wait and see attitude.

It is heard that an important Spanish SSC having booked 10,000 tonnes of HRC 3 mm and up from Beitai at EUR 685 per tonne CIF FO Bilbao with payment term of LC at 90 days from bill of lading date.

However other lots are still unsold with traders avoiding to take position as the sentiment is that price may fall further in the forth coming weeks.

Understand that HRC availability from China might have been determined by the mill's decision to produce for stock, trying to bridging up the period of closing or reduced activity imposed by the Chinese government in the effort of reducing pollution during Olympic Games.

One will have to wait and see by end of August or early September if this is just a "spot" situation or is the starting of a real change in price trend and market direction.

(Sourced from www.steelprices.com)

Evraz in merger talks with IUD - Komemersant

Kommersant daily reported that Russian steel maker Evraz Group is discussing a merger talk with Ukraine's Industrial Union of Donbass that would create one of the world's top five steelmakers.

The paper said if the merger takes place the combined company would be worth USD 50 billion.

The paper quoted unidentified sources in Russian and Ukrainian investment banks as saying that Evraz shareholders, including Russian billionaire Mr Roman Abramovich would get control of the merged company.

The paper quoted Mr Pyotr Antropov executive director of KBC Securities said that "Evraz has already completed the financial and production audit of all metal assets of IUD."

Mr Pyotr said that "According to our information, the deal should soon close."

Evraz was not immediately available for comment.

ArcelorMittal and IUD to bid jointly for Kriviy Rih ore complex

It is reported that ArcelorMittal Kriviy Rih and Industrial Union of Donbass agreed to a joint bid for the Kriviy Rih ore dressing plant. According to the report, the two companies also want to build a cargo port on the Black Sea and to develop a manganese ore field in Ukraine.

KGOKOR needs financing for the completion of its construction as it is currently 80% ready and will have the capacity to produce 10 million tonnes of pellet maker comparable to the output of Ferrexpo Poltava.

Millennium Capital analyst said that “We believe that the creation of the consortium itself is neutral for both parties as KSTL and IUD had announced in late 2007 that this was happening. This time Russia’s Metalloinvest was close to grabbing KGOKOR but did not manage to succeed. If KGOGOR is to be privatized to the new IUD-KSTL consortium, KSTL and IUD’s steel plants, Alchevsk SW and Dniprovsky SW, will be positively affected by lower cost iron ore supplies. The news about a deep sea port is, undoubtedly, positive as Ukraine lacks ports that are capable of handling high tonnage ships when importing coking coal and coke from Canada, the US and Australia.”

(Sourced from Millennium Capital)

OMZ to sell Pilsen Steel by 2008

CTK reported that the Russian engineering concern OMZ will sell the steelworks Pilsen Steel for around CZK 4.8 billion by the year's end at the latest.

As per report OMZ is currently in talks with six bidders, including Russian, Spanish and Indian steel makers. A source close to OMZ told CTK that the talks have been underway since the beginning of the year and the interest is unexpectedly high.

The source added that Pilsen Steel will be certainly sold by the year's end. He said that it would be more advantageous if Pilsen Steel was acquired by Russian companies but the price of the bid will be decisive.

Mr Mikhail Chepeliv OMZ representative in the Czech Republic said that "I can neither confirm nor refute the information on the sale.”

According to the source, OMZ would use the money from Pilsen Steel's sale to buy further Czech companies cooperating with the Brno based civil engineering companies Cheteng Engineering and Techeng CZ, which OMZ acquired in May.

OMZ bought Pilsen Steel and Skoda JS, producing equipment for nuclear power plants for about CZK 1.1 billion four years ago

Mr Putin against curbs on scrap metal exports

Interfax reported that Mr Vladimir Putin Prime Minister of Russia has said he is opposed to setting up a tax and tariff regime to stimulate exports of scrap metal and nonferrous metals.

He said at a meeting on the metals industry in Nizhny Novgorod that "Let's decide already. Are we going to stimulate the export of this raw material or do we want to keep it on our own markets?"

He said that "I am also aware of the proposals from our metals producers about the possible purchase of all the ferrous scrap metal on the domestic market, including for future reserves. I feel it would be fully grounded to raise this issue," he said.

He added that "I ask that the appropriate agencies submit proposals on the creation of controlling mechanisms as well as adjustments to export duties and the tax regime in this sphere."

As per report, the same mechanism can be used with scrap metal as is used with timber, under which export duties are raised sharply for raw materials with the goal of developing processing within the country.

TMK Artrom launches new cogging mill

It is reported that TMK Artrom commissioned its new cogging mill, which completed vertical integration of TMK production complex in Romania.

As per report, use of the cogging mill will enable to reduce cost of finished goods due to eliminating energy costs for billets re rolling and improving production yields. In addition, use of this technology also improves quality of finished pipes by enhancing their paste forming properties.

All seamless pipes produced by TMK-Artrom will be manufactured of billets produced at TMK-Resita, TMK’s steelmaking facility in Romania.

Evraz wins license for Mezhegey coking coal deposit

Evraz Group announced that it won the tender to develop the Mezhegey coal deposit in the Republic of Tyva, Russia. Evraz offered USD 725 million in the tender held by the Russian State Mineral Resources Agency.

According to the release, the Mezhegey coal deposit is located 800 kilometer east of the city of Novokuznetsk in the central part of the Republic of Tyva, East Siberia. It is a world class coking coal deposit with estimated category A+B+C1 coal reserves and resources of 213.5 million tonnes of hard coking coal.

The released added that the development of the Mezhegey deposit is expected to commence in 2010 with the first coal to be mined in 2014. Evraz plans that the target production level of 10 million tonnes of raw coal i.e. approximately 8.4 million tonnes of coal concentrate will be reached by 2016. Based on Evraz’s experience in developing coal projects in Siberia, the Company estimates the project’s development cost at approximately USD 1.5 billion.

Mr Alexander Frolov, Evraz’s Chairman and CEO said “The purchase of the license to develop the Mezhegey coal deposit is in line with our strategy to expand Evraz’s mining platform. The Company will secure additional supply of high quality coking coal to its existing steel making facilities as well as deliver extra volumes of the coal to meet the growing demand from the market.”

Evraz seeks leverage for takeover in China

The South China Morning Post citing people it didn't identify said that Evraz Group SA would use Cape Lambert Iron Ore Ltd to gain leverage for a Chinese takeover.

The shareholders of Cape Lambert, an Australian iron-ore company, are scheduled to vote July 28 on an agreement from June to sell a 1.56 billion tonne iron ore mine worth USD 393 million to MCC Mining, the Australian unit of China Metallurgical Group Corp

Evraz plans to use the 19% stake it took in Cape Lambert last week to press Beijing for approval of its plan to buy as much as 51% of Chinese steelmaker Delong Holdings Ltd, which has been pending Chinese regulatory approval since February.

The newspaper said Evraz can not block the Cape Lambert iron ore mine sale to MCC Mining with its existing stake. Australian takeover rules require a shareholder with 20% or more of a listed company to make a general buyout offer, making it impossible for Evraz to buy more shares in Cape Lambert without such an offer.

Stroytransgaz to build USD 400 million gas pipeline in UAE

Stroytransgaz, one of Russia's largest engineering and construction companies announced that it had signed a USD 400 million contract to build a gas pipeline in the United Arab Emirates.

Stroytransgaz said in a statement that "Representatives of Stroytransgaz and Dolphin Energy Ltd have signed a contract for the construction of the Taweelah-Fujairah gas pipeline in the United Arab Emirates."

The released added that the 240 kilometer gas pipeline will run right across the UAE to link gas receiving facilities at Taweelah on the Persian Gulf with a water treatment plant in Fujairah on the Gulf of Oman.

Stroytransgaz, which is partly owned by Russian energy giant Gazprom is involved in oil and gas construction projects in 15 countries.

Metinvest units adopt SAP for mining enterprise management

It is reported that on July 1st 2008 Dokuchayevsk Flux and Dolomite Plant and Novotroitskoye Ore Mining operating under Metinvest Group umbrella adopted an enterprise management system based on industrial solution for ore mining companies SAP for Mining.

The project was launched on January 1st 2008. The following functional areas were introduced within the framework of SAP at DFDK and Novotroitskoye Ore Mining:
1. Management of finance
2. Management of accounting and controlling
3. Management of material flows
4. Sales management
5. Production management
6. Budget management
7. Investment management.

As a result of the project, major business processes at DFDK and Novotroitskoye Ore Mining were integrated in compliance with the global practices of mining business management. The enterprises copied settings of the system and connection of users to integrated system that were applied before at SevGOK and Central GOK.

The project was implemented by SAP Competence Control certified by SAP Competence center. A SAP certificate entitles Competence Control specialists to implement and maintain systems at enterprises of Metinvest Group. An operation team of the leading specialists of DFDK and Novotroitskoye Ore Mining took part in the project implementation process.

Mr Putin to chair meeting on metallurgy in Nizhny Novgorod

It is reported that Mr Vladimir Putin PM of Russia's will pay a one day working visit to the Nizhny Novgorod region, where he will visit Vyksa Steel Works operated by OMK and chair a meeting on measures to bolster the development of ferrous metallurgy and boost the supply of ferrous metals on the Russian market.

As per report, the meeting will tackle the ferrous industry development strategy until 2015, and possibly extend the strategy until 2020. At this moment, the demand for ferrous metals is met almost in full, and the current shortages will be overcome in three years.

Delong to wait for new law to decide on Evraz takeover offer

XFN Asia reported that Singapore listed Delong Holdings will wait for China's new anti monopoly law to take effect before deciding what to do about the bid by Russia's Evraz Group SA to take over the company.

Mr Yim Jeng Yuh a Delong spokesperson said that "The anti monopoly law will come out on August 1, and we will consider the next step after we see the law."

In February, Evraz announced it would buy up to 51% of Delong for about USD 1.49 billion. A call/put option agreement between Delong and Evraz will expire on August 18.

Mr Putin approves new Russian Railways Board of Directors

Itar Tass reported that Mr Vladimir Putin PM of Russia approved the new nine members Board of Directors of Russian Railways.

According to the report, Mr Alexander Zhukov First Deputy Prime Minister will be the only representative of the government in the company. The other members of the Board of Directors are
1. Mr Vladimir Yakunin Russian Railways President
2. Mr Andrei Kostin president of VTB
3. Mr Alexander Shokhin President of Russian Union and Industrialists and Entrepreneurs
4. Mr Andrei Sharonov MD of Troika Dialog
5. Mr Alexander Ryazanov former Gazprom Neft CEO
6. Mr Dmitry Komissarov former chairman of Transmashholding’s Board of Directors,
7. Mr Vladimir Gusakov president of Tsentrinvest
8. Mr Nikolai Kosov VEB First Deputy Chairman.

Yenakiyevo Metal Plant assigned uaA credit rating

It is reported that credit rating an independent rating agency in Ukraine upgraded the long term credit rating of Yenakiyevo Metal Plant from uaBBB to uaA. Yenakiyevo said that the outlook is stable.

In the course of analysis the agency used financial reports of Yenakiyevo Metal Plant for 2006 to 2007 as well as internal information provided by the plant.

Mr Aleksandr Podkorytov CEO of OAO Yenakiyevo Metal Plant said that “Credit Rating’s independent assessment of Yenakiyevo Metal Plant’s borrowing potential is important for our business.”

He said that “The agency isolated key competitive edges of the plant: use of effective converter method in steel production, the lowest energy consumption among domestic steel enterprises, and operation within vertically integrated Metinvest Group. The plant systematically implements the long term modernization program. All these factors enable YeMZ to keep high and stable position among Ukrainian steel enterprises in terms of production volumes."

Prokhorov's Onexim opts not to take part in Udokan copper field tender

Interfax cited Mr Dmitry Razumov general director of Onexim as saying that Mikhail Prokhorov's Onexim Group has decided not to take part in a tender for the giant Udokan copper field in Russia's Chita region.

Nickel hits 2 year low on LME

Nickel fell below USD 20,000 a tonne on Thursday for the first time in just over two years on weaker stainless steel demand.

London Metal Exchange nickel dropped by 3% to USD 19,400 a tonne lowest since June 2006. On Wednesday it closed at USD 20,000, after falling 2.7% on weaker demand from stainless steel producers, accounting for about two thirds of global nickel demand.

LME nickel stocks rose 180 tonnes to 43,368, although inventories are down 17% over the last three months.

Directory of Stainless Steel Supply Chain in China

China remained the world's number one producer of stainless steel in 2007 accounting for more than one quarter of 27.6 million tonnes of global output. China had overtaken Japan as the world's biggest stainless steel producer in 2006 with 6.6 million tonnes in 2006 up by 21.7% YoY. Japan followed China as the second largest producer in 2007 wi