It is reported that Indian government will bring iron ore producers and steel manufacturers to the negotiating table to ensure that the raw material is supplied at a reasonable cost.

A series of meetings have been lined jointly by the Ministries of Steel and Mines and the first meeting is scheduled to be held in Bangalore between iron ore producers and steel manufacturers. The next meeting would be held in Kolkata on August 27 and would be attended by secondary steel producers, sponge iron and pig iron manufactures and leading miners.

In the proposed meeting, the government is likely to persuade iron ore miners to sell the raw material at reasonable rates to the steel industry, besides entering into long term contracts with them for supply of the ore.

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.

To know more, please visit
http://steelprices-india.com/spi_services/spi.html

It is reported that TATA Motors on Saturday received open offers from a couple of states and hints from another to move its plant to manufacture the world's cheapest car Nano to their region, a day after Mr4 Ratan Tata's threat to quit West Bengal following violence at the current project site.

As per reports, the chief ministers of Maharashtra, Andhra Pradesh, Orissa and Uttarakhand and the industries minister of Punjab offered red carpet treatment in their states.

Mr Manoranjan Kalia industry minister of Punjab said that he would write to Mr Tata and provide every facility Tata Motors may require to bring out Nano, the world’s cheapest car.

Mr Vilasrao Deshmukh chief minister of Maharashtra said that he is ready to provide land, water and power if Mr Tata wanted to relocate the Nano project in the state.

Mr Naveen Patnaik chief minister of Orissa said that "If Tata Motors approach us, we will certainly see to it."

Dr YS Rajasekhar Reddy chief minister of Andhra Pradesh said that he would renew the invitation given to Mr Tata earlier. He said that "A year and a half ago I had requested him to locate Nano plant in Andhra. I do not know why he went to West Bengal. I will write to him again."

Mr Indu Kant Pande chief secretary of Uttarakhand said that he had held talks with TATA Motors officials to shift the Nano project to the hill state. He said that "We will negotiate with them further.”

On the other hand Mr Buddhadeb Bhattacharjee chief minister of West Bengal said that "Some states have offered land to the Tatas but I would like to assert the project will be a reality. The first car will roll out in October."

It is reported that Jai Balaji Industries has signed MoU with the Government of Chhattisgarh. The MoU has been inked for developing an integrated steel plant in the state of Chhattisgarh.

Further details are awaited

Kalinga Times reported that tension prevailed in the Kalinga Nagar, the steel hub of India in Orissa's Jajpur district on Saturday following an accident in Rohit Ferrotech plant premises in which one person was killed.

The deceased was a contractual laborer of the plant and was engaged by the Ganesh Minerals and Traders, a contractor to the Rohit Ferrotech.

According to Kalinga Nagar police, the mishap occurred on Saturday morning when Bapuji was crushed to death by the conveyer belt while cleaning it at the raw material yard of the plant. The local police said that the deceased was rushed to the local government hospital at Danagadi where the doctor on duty declared him brought dead.

Soon after the incident, hundreds of workers including contract laborers of the Rohit Ferrotech steel company gheraoed the plant demanding compensation and a permanent job on compassionate grounds to the next of the kin of the deceased soon after the mishap. The gherao was withdrawn after Rohit Ferrotech plant management declared a compensation of INR 0.4 million and a job to the kin of the deceased.

It is reported that NTPC is all set to become a 30,000 MW company in 2008 after the commissioning of its 500 MW plant at Kahalgaon in Bihar in November.

Mr RS Sharma CMD of NTPC said that "We are hoping that the installed power generation capacity of the company would reach 30,000 MW mark by the end of this year once the 500 MW unit of Kahalgaon project is commissioned."

Mr RS Sharma, when asked about the plans during the 11th five year plan which has been pegged at adding 22,000 MW power generation capacity, said that all the projects were on track and running as per schedule.

He said that the company which plans to focus on hydro power generation would produce its first unit of electricity next year. He added that the company has set a target to add 7,000 MW of electricity to its total capacity only through hydro by the end of 2012.

Mr Sharma said that on the thermal side, although the company has ambitious targets but the ongoing tussle with the domestic coal companies especially Coal India Limited over the shortage of coal may upset NTPC's plans.

Reuters reported that investments in India's special economic zones may cross 2 trillion rupees by next year.

The report quoted Mr GK Pillai Commerce Secretary in a seminar as saying that the investments, which currently stand at about INR 770 billion would cross INR 2 trillion by the end of next year.

He added that "Employment would cross 800,000 by the end of December 2009. It's an almost 4-fold increase in employment in SEZ.”

According to Captain PVK Mohan member of National Shipping Board an apex body advising the Ministry of Shipping on matters related to the shipping industry, inadequate investment by the Government in coastal shipping, the sector has not progressed well over the years. This is despite the fact that this sector is being discussed in every forum.

Mr Mohan at a seminar of the Indian Coastal Shipping said that “Investment in the Indian shipping itself is low when compared to rail and road sectors.”

He said that “Unlike textile, cement and steels sectors, we do not have a strong lobby to take up the issues related to coastal shipping. We are too busy with our own things and concerned about the day to day issues. Unless there is a strong representation we will not be able to move further.”

Mr Rajeev K Gupta joint secretary, Ministry of Shipping said that despite having a number of reports on coastal shipping the sector has not progressed well. He said that “Come out with innovative ideas to develop the sector. Coastal shipping should not be considered in isolation but be part of the overall infrastructure.”

According to the Mr Sudhir S Rangnekar Group CEO of Sical Logistics, there are nearly 10th reports including that of Afzalpurkar, Pinto and TCS on coastal shipping. Most of the recommendations have been more or less the same.

As per the report, cargo traffic through coastal shipping in India was around 110 million tonnes. This is compared to 875 million tonne handled by China, 549 million tonnes by Japan, 141 million tonne by South Korea and 133 million tonnes by Indonesia.

'Directory of Autoparts Makers in India' is one of the top sources of information available on auto part makers in India. It is one of the most comprehensive and accurate directory of auto part makers in India.

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This report covers name and product details of 431 of Indian auto part makers in alphabetical as well as location wise order.

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• Company name -431 entries
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• Phone number-431 entries
• Fax number -418 entries
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Report Summary:
1. Published: May 2008
2. Format PDF File (Delivery by Email on receipt of payment)
3. Total no of pages – 241

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BL reported that Orissa Sponge Iron & Steel Ltd has set in motion its capital raising plan by issuing 7 million warrants to a promoter group and company and to a Unitech group company.

The company has decided to issue 4 million equity share warrants convertible into same number of equity share of INR 10 to TRFI Investment Pvt Ltd, a promoter group company at a price calculated according to the relevant SEBI guidelines. It is also issuing 3 million equity share warrants convertible into the same number of equity shares to Prakasauli Investment Pvt Ltd, a Unitech group outfit and an existing investor in Orissa Sponge holding 12.11% stake in the total equity of INR 20 crore. Shareholders’ approval for the warrants issue would be sought through postal ballot.

Dr PK Mohanty vice CMD of Orissa Sponge told Business Line that Unitech is a financial investor in the company, which still did not represent itself on the board of Orissa Sponge. He said that “By letting Unitech increase its investment in Orissa Sponge, it is not been intended to make the steel company a joint venture.”

Unitech group, since inception of Orissa Sponge has been an investor. Unitech Ltd, in the beginning, had invested more than 7% in the then paid-up capital as a joint promoter. Later on, the investment was transferred to Unitech Holding, which raised its stake, but became part of the public shareholders. Currently, the group’s holding is reflected through Prakasauli.

Orissa Sponge Iron & Steel, which has obtained iron ore mining rights in Keonjhar of Orissa having an estimated reserve of 130 million tonnes is preparing to start the mining operation. Orissa Sponge has proposed to set up one million tonne steel plant through electric arc furnace and sponge iron route, the first phase work of which is expected to begin in the next couple of years. The company has also received coal mining rights in Talcher in Orissa with an estimated reserve of about 125 million tonne.

ET reported that National Commodity and Derivatives Exchange has plans to launch non dematerialized commodity trading, which is expected to be rolled out in the country by December this year.

Mr R Ramaseshan MD & CEO of NCDEX told reporters that the non demat format would be less expensive and the exchange was hopeful that the new system would go online from December 31.

He said that “At present, the exchange is trading in electronic format by which the traders have to pay INR 600 for each contract. So the margin in trading is very limited and the traders are not prepared to incur the additional cost. As part of this, the exchange is developing a new warehouse management system which will be introduced in a two months time. The software is ready and the trials are going on.”

He added that the exchange will look into non agricultural products like metals and carbon credit.

The NCDEX Spot Exchange, a wholly owned subsidiary of NCDEX, has already launched steel contract, which was attracting a volume of INR 7 million to 10 million a day.

It is reported that Lanco Infratech is planning to foray into solar modules' manufacturing and solar power generation. A special purpose vehicle is being formed for this purpose.

As per report the move follows the company’s recent initiative for wind energy equipment manufacturing facility, which will later lead to wind energy farms in India and abroad with investment of about INR 1,000 crore initially.

It is reported that State High Level Clearance Committee of Industries in Karnataka approved 25 projects, with an investment of INR 30,000 crore.

The projects approved include two iron and steel plants and two cement units, one unit each in sugar, power, engineering, integrated townships, bio-fuel and petroleum sectors, two SEZs , two tourism projects, three port development proposals at Honnavar, Karwar and Malpe.

Some of the projects details, which are approved by the committee are as follows

1. BMM Ispats' INR 6,151 crore steel plant, to be spread over 3,000 acres of land at Hospet.

2. CF Bio Tech's power plant, with 9 MW capacity at Savadatti in Belgaum district with an investment of INR 122 crore.

3. Gulf Oil Corporation's SEZ at Kattigena Halli village of Jala hobli with an investment of INR 850 crore.

4. Poornimadevi Tech Park's INR 238 crore on a 32 acre plot at Mariyappana Palya of Kengeri hobli.

5. Gopalan Enterprises' bio technology unit, to be spread over an area of 27 acre plot, at a cost of INR 190 crore at Nallore Halli village of Bangalore East taluka.

6. One integrated township each by NEC and Cornerstone Shelters on 500 acre and 200 acre plots, respectively in Devanahalli taluka.

7. Two super speciality hospitals in Devanahalli taluk, one by Dr. Devi Shetty of Narayana Hrudayalaya on a 25 acre plot at a cost of INR 1,000 crore, and the other by Satya Sai Hospital of AS Hegde in Bangalore North taluk, on a 25 acre plot, by investing INR 430 crore.

Project Today reported that Bharat Heavy Electricals flagged off its first consignment of boiler components to BHEL in Thiruchirapalli, after being taken over by Bharat Heavy Plate & Vessels by BHEL in May 2008.

The first consignment consists of boiler pressure parts for BHEL Tirchy Plant from here. The value addition for the orders given to BHPV by BHEL Tiruchy would be around five crore.

These pressure parts consists of water wall panels and riser pipes destined to Durgapur and Koderma projects for Damodar Valley Corporation, Kolkata and to Sikka Gujarat State Electricity Board, Baroda these critical power boiler pressure parts have been manufactured under IBR inspection.

BHEL gave these orders worth INR 1.2 crore to BHPV immediately after taking over of BHPV on May 10th2008.

It is reported that real estate developer Salarpuria Group plans to invest about INR 3,000 crore in 12th to 14th projects across the country. These will be a mix of residential, commercial, retail and hospitality which are in various stages of implementation, located in Bangalore, Hyderabad, Pune, Kochi, Jaipur, Kolkata and Visakhapatnam.

As per the report, Salarpuria group announced the launch of an INR 1,000 crore, 1,672 apartment residential project, Greenage spread over 21 acres on Hosur Road. The first phase of the project will have 800 apartments being built and is expected to be completed in 30 months. Zachariah Consultants are the architects for this project. Amenities offered are helipads, a creche, tea gardens, a retail area that would have a convenience store, beauty salon, 2 theatres and ATMs and a media centre.

The company also plans to build malls in Hyderabad and Jaipur and 2 in Bangalore. Besides, 2 hotels one each at Bangalore and Hyderabad are being planned with investment of INR 160 crore in each project.

BL reported that as it issued the Letter of Award for the INR 12,000 crore Hyderabad Metro Rail Project to the Maytas-Nava Bharat Ventures consortium, the Andhra Pradesh Government has reserved the right to get the Golden Share.

A Golden Share is a token INR 10 share given by the consortia to the governments, giving it a veto right to block moves that might go against the public interest.

Mr N VS Reddy MD of Hyderabad Metro Rail Ltd told BL that the share gives a notional shareholding of 26% to the Government besides the 11% equity it would have in the prestigious metro project, which could prove to be a money-spinner for the Government.

He said that the project would get INR 30,311 crore to the State Government from the consortium, which the industry calls negative grant, for giving the right to construct the metro project. He added that “This is just a safeguard inbuilt in the agreement in order to protect the public interest. The Government could use this to stop the consortium to shift the headquarters to some place outside the State, alter the provisions of the association or reduce the share capital.”

According to Mr VV Rama Raju vice president (Finance) of Maytas Infra would have 26% in the project that envisaged laying of three routes with a total length of 71 kilometer. Another Hyderabad based company Nava Bharat Ventures Ltd would have 27% while Italian Thai Development Public Company Ltd and IL&FS would have 5% each. In all, the consortium would have 63%.

Bloomberg reported that Cia Siderurgica Nacional SA has not received any formal offers for its Nacional Minerios SA unit, though it may accelerate plans to sell the iron ore producer because of strong interest from potential buyers.

Ms Flavia Ferreira spokeswoman of CSN said that “It is creating quite a stir. We have not received proposals yet, but there are a load of people interested.''

Reuters reported that Nippon Steel Corp., JFE Holdings Inc. and a Japanese trading company are bidding for Namisa. Reuters, citing unidentified people in the industry, said that the transaction may be worth as much as USD 10 billion.

Mr Juarez Saliba ED of business development of CSN had said on August 19th 2008 that CSN may complete the sale by late September and would announce the results of the bidding process in October.

CSN is seeking to sell Namisa to help raise cash to expand its larger iron-ore unit, Casa de Pedra, which started exporting last year.

Environmental Clean Technologies said that it has successfully tested its patented single step steel making process with a shipment of Mongolian brown coal. The Matmor process is said to use a blend of brown coal and iron ore to create cleaner, low carbon steel.

According to the company, it can be used in developing countries like China and India as an effective way of processing billions of tonnes or otherwise unviable resource. The test recovered more than 90% of the metal in the form of a very low carbon and low sulphur pig iron. It proved the process works with sub bituminous coal and low grade iron ore deposits and can produce feedstock suited for secondary steel and iron production using electric arc or induction furnaces.

The technology developer said that replacing coking coal with sub bituminous coal can produce savings of up to USD 345 a tonne, reduce emissions by as much as 50% compared to standard steel making plants, and slash capital expenditure because there is no need for coking ovens and sinter plants.

The process is still in its research and development phase, with the next test stage to scale up production to 6000 tonnes per annum

Thai HRC maker G Steel Plc has denied a report of a share purchase deal with ArcelorMittal.

Mr Ryuzo Ogino director of G Steel said that "Currently, there is no negotiation of such issue, and if there were to be more information or further development on this, G Steel will notify the public promptly."

It may be noted that a local newspaper reported that ArcelorMittal was in talks with the Leeswadtrakul family, G Steel's major shareholders with an 8.5% holding. It said the family planned to sell shares at THB 4 each compared with a book value of THB 2.69.

Jakarta Post reported that Indonesia's major steel manufacturers are planning to raise their exports for the next 3 months to compensate for decreased local demand in the period surrounding the Islamic fasting month of Ramadhan and Idul Fitri.

Mr Irvan K Hakim marketing director of PT Krakatau Steel said that PT Krakatau, along with PT Essar Indonesia and privately owned Gunung Garuda Steel Group, were raising exports this month through to October. He added that "The domestic market slows down during the three-month period as the country is welcoming the fasting month and Idul Fitri. It is impossible for us to lower our productions during the period. Therefore, we are turning to exports."

Mr Irvan said that although the three companies claimed the domestic market was traditionally relatively sluggish during the period, they had received orders from numerous government projects to deliver in the holiday window. He added that "We promise those projects will be our top priorities because they are in the public's interest and have deadlines."

The three companies' main export markets include Southeast Asia, the Middle East and Europe. However, exports will remain low compared to domestic sales.

During the period, Krakatau will increase its exports from 10,000 tonnes per month to 20,000 tonnes per month, Essar from 5,000 tonnes to 9,000 tonnes and Gunung Garuda from 35,000 tonnes to 40,000 tonnes.

Krakatau annually produces 2 million tonnes of hot roll coils, 85,000 tonnes of cold roll coils, 450,000 tonnes of wire rods, 300,000 tonnes of steel bars and 200,000 tonnes of steel pipes. Essar manufactures 400,000 tonnes of cold roll coils per year. Gunung Garuda yields 700,000 tonnes of hot roll coils and 500,000 tonnes of long steel products, including H beams, per year.

Corus has entered into exclusive negotiations with a new prospective buyer of its aluminum smelters in the Netherlands and Germany.

In December 2007 Corus and AIAC announced the signing of a non binding LoI for the acquisition of Corus’s aluminum smelters by an AIAC affiliate. Following further discussions with AIAC, a decision has been taken not to proceed any further. Corus has informed the Works Council and Trade Unions about this decision.

The release said that “Corus has started discussions with Klesch & Company Limited, which has been granted a period of exclusivity for due diligence to be carried out. Any eventual Sales and Purchase Agreement that is reached following internal consultation and advice may also be subject to certain external regulatory clearances.”

It added that “Following the sale of Corus’s downstream aluminum extrusions and rolling business to Aleris in August 2006, Corus has been looking at opportunities to secure a future for its aluminum smelters outside the Group. The two smelters are based in Delfzijl in the Netherlands and Voerde in Germany and produce more than 200,000 tonnes of primary metal per annum.”

The new report on Indian steel from Steel and Natural Resources Research authored by Dr AS Firoz, Strategy Consultant, comes out with findings completely different from the popular growth stories told about the short and mid term potential of steel demand growth in the country. The report, yet to be officially released, blames much of it to the uncertainty in the policy regime and deep structural weakness in the economy.

The report says India may see a drop in steel demand in the coming two years. The annual growth rates in finished steel consumption are likely to be 5.5% in 2008-09 and about 4.5% in 2009-10. This is in sharp contrast to the forecasts made earlier when growth rates were expected in the range of 9% to 12% for these two years. Demand growth for stainless and alloy steel also will remain far below potential. The study has predicted significant change in the structure of the market in the next 10 years from the earlier forecast scenarios with changes in the growth trends for specific products.

The report further goes on to project a rather pessimistic scenario in respect of production growth as new projects start ups have been significantly delayed. While the Brownfield expansion projects of the private companies and RINL are on course, SAIL, the study finds, is way behind the schedule.

The new supply and demand conditions in the market will leave their expected impact on the external trade. Imports will remain far above exports this year, but, the situation will start changing from 2009-10. Exports of steel, especially flat products, will sharply rise to turn the country into a net exporter of steel once again.

The study forecasts prices of steel to come under pressure with weakening of demand and not so much due to government actions. With rising costs of coking coal, the integrated mills will see their margins eroding. Higher costs of other inputs such as iron ore, non-coking coal and ferroalloys will hit the secondary sector hard.

The steel companies will also find it hard to mobilize resources for their new projects, the report concludes.

To know more about it, please send a mail to reports@steelguru.com

It is reported that on August 18th 2008, American H1 scrap prices in Pittsburgh, Chicago, and Philadelphia all keep steady around USD 449.17 per long ton. It is the same with the price last week. The price of one bundle scrap number 2 remains by USD 427 per long ton.

In Pittsburgh, the H1 scrap price is around USD 474.50 per long ton, in Chicago, the H1 scrap price is around USD 449.50 per long ton and in Philadelphia, the H1scrap price is around USD 423.50 per long ton.

In the East Coast, the average price of H1 scrap is USD 408.83 per long ton in New York, Boston and Huston. And the average price of H1 scrap in Los Angeles, San Francisco and Seattle is USD 184.33 per long ton in West Coast.

It is reported that US Steel Corporation's 14,000 unionized steelworkers will receive a record USD 4,464 each in profit sharing for the company's second quarter performance.

Union spokesman Mr Wayne Ranick said that the members of the United Steelworkers receive the profit sharing under a formula outlined in their contract with US Steel.

Eligible USW members will receive profit sharing based on 480 hours worked at a rate of USD 9.30 an hour. A year ago, USW members each received about USD 2,137 for the second quarter 2007.

Olympic Steel Inc has announced that Ms Tami Curran is the 2008 recipient of the Chairman's Humanitarian Award. The award recognizes employees for extraordinary contributions to the community or special initiative, resourcefulness and courage in an emergency situation on or off the job.

Ms Curran was presented with the award at a ceremony that took place on July 31st 2008 at the Corporate Office in Cleveland. She is a 10th degree member of the Schaumburg, Illinois Chapter of the Junior Chamber, holding numerous leadership roles ranging from Regional Rookie of the Year to director and currently, VP of the organization.

Outside of the Jaycee's, Ms Tami is also involved in her local Memorial Day Observance Committee in the role of head of public affairs for cost of freedom tribute, dedicating countless hours to coordinating the memorial event and other veteran recognition.

Ms Tami was nominated for this recognition by co worker Ms Andi Ultizsch, who noted that "She works behind the scenes making these and so many other events a success, and steps out to help others on a daily basis."

Founded in 1954, Olympic Steel is a leading US steel service center focused on the direct sale and distribution of large volumes of processed carbon, coated and stainless flat rolled sheet, coil and plate steel products. It operates 16 facilities.

It is reported that Nippon Steel and JFE Steel's higher ferrous scrap purchase volume impacts on Japanese market. The domestic scrap supply was 200,000 tonnes short for the consumption in January to June 2008 period while the material is one of few resources with self sufficiency for Japan. The price increased by JPY 30,000 per tonne during the half year.

It is reported that Alunorf GmbH is investing in highly advanced plant technology for aluminum recycling and has warded LOI Thermprocess a contract to supply a twin chamber melting furnace.

The recycling system will be designed for a capacity of 150 tonnes of molten metal per day, produced entirely from aluminum scrap. Various types of aluminum scrap are to be melted and the molten metal will be used to produce new rolling ingots.

LOI Thermprocess equipment was chosen for the project because of its outstanding performance and its environmentally compatible, energy efficient operation.

Contaminated scrap does not require pre-treatment. The integrated waste gas treatment system ensures that pollutants are reliably and effectively combusted. The recycling furnace is equipped with a regenerator system ensuring a high level of waste heat recovery from the waste gas. The cooler, reduced waste gas flow reduces the capital expenditure for the filter system. In addition, the LOI regenerator system rapidly cools the waste gas, improving the environmental compatibility of the plant.

The recycling plant is due to be commissioned in the autumn of 2009.

Mr Hugo Chavez Venezuelan President has escalated a dispute with Cemex SAB, saying that the company's local unit polluted the environment and failed to invest by focusing solely on profit.

Mr Chavez said that "Go see the pollution not only along the coasts and in the trees, but in the lungs of the children. Everything is full of powder. Cemex never invested in technology to eliminate the powder because they took all the money abroad.'' He also said that Cemex executives acted in a disrespectful manner to Venezuelans and has a superiority complex.

In a statement recently, Cemex said that it has been respectful of the legal decisions and rules in the countries where it operates. It added that Venezuela offered it less than Lafarge and Holcim when measuring the price by ton of capacity or by EBITDA.

It may be noted that Venezuela seized the local operations of Cemex, the largest cement maker in the Americas, as part of a nationalization drive after the government and the company failed to reach an accord on a forced sale.

Bloomberg reported that Eskom Holdings Limited will shut down a generator at its Koeberg nuclear power plant to conduct maintenance work over the next 3 days.

Mr Tony Stott spokesman of Eskom said that the unit 1 generator at the facility near Cape Town will cease operations to allow technicians to repair valves on steam lines that drive its turbines.

He added that no power cuts are expected as a result of the shutdown and the generator is expected to resume full operations late on August 24th 2008.

It is reported that members of Austin City Council have postponed a vote on a controversial energy contract to allow Austin Energy to purchase USD 2.3 billion worth of power from an East Texas Bio Mass plant, saying that it wanted another week to seek outside legal assistance on drafting a 20 year contract with the Nacogdoches Power Company.

Explaining the project’s appeal, Mayor Mr Brewster McCracken said that “What do we do? Build it with natural gas, coal, nuclear? All those are going to cost in excess of a billion dollars in up front capital costs. And that does not include the cost of fuel and we then own the plant for 50 years."

The alternative proposal from Austin Energy is purchasing 30% of its power from the Nacogdoches Power bi -mass plant at a cost of USD 2.3 billion over the next 20 years.

The council scheduled a special called meeting for next week to discuss this idea in executive session and could approve the contract the next day at its regular council meeting.

Hellas’ ocean going shipping industry continues to evolve into one of the main sources of income for the country’s economy, as proven once more by the latest preliminary figures, published by the Bank of Greece.

According to them, records keep on being broken, with income from shipping activities pouring into the economy reaching a total of EUR 9.4 billion for the period between January and June 2008. This figure represents an increase of 22.3% YoY, when a total of EUR 7.69 billion were injected in the form of shipping revenues. This increase highlights the dynamics of the country’s shipping industry, which remains on top of the world, as well as the positive conditions prevailing in the freight market, especially after the first quarter of the year, which was characterized by a market correction.

Only in June 2008, approximately EUR 1.74 billion were the result of shipping activities, when during the relevant month of last year, the outcome had not surpassed ERU 1.37 billion. This year on year increase stands at 27.03%.

These statistics are a true testament of the rapid growth of Hellas’ maritime industry, while at the same time fully justifies the prediction made earlier this year by Mr Nikos Efthimiou president of Union of Greek Shipowners, who had said that the annual revenues from shipping are expected to top last year’s record and surpass the EUR 17 billion mark.

Reuters reported that Gulf Arab states are likely to scrap a system of charging import duties for the benefit of the state of final destination in 2009, the last step in implementing a regional customs union.

The report cited Saeed Khalifa Al Marri deputy director general of the UAE Federal Customs Authority as saying that “Saudi Arabia, the UAE, Oman and Kuwait are supporting a plan to introduce a simplified customs duty collection system.”

Mr Marri said that “Under the proposal, each Gulf state would keep 95% of the customs duties it collects at ports of entry and transfer 5 per cent to a central account at the Gulf Cooperation Council General Secretariat. The GCC would then redistribute the funds it collects to each of the six states, which also include Qatar and Bahrain, based on a pre-determined formula.”

He said that "We are looking at scrapping the final destination system, this is the final phase of the customs union.”

He added that “The decision, which has to be unanimous, now sits with Gulf finance ministers, who are due to meet next in Jeddah in September. Our target is that by January 1st 2009, we should implement the final phase of the customs union.”

GCC introduced a customs union in 2003 as one preparatory step to the formation of a regional common market. The main feature of the union was the introduction of a consistent 5% tariff charged at the first Gulf port of entry, after which the goods can move freely through the region. Under the final destination framework, tariffs collected at the first port of entry are pocketed by the country of final destination.

It is reported that Iranian steel major Khouzestan Steel Co will add a new direct reduced iron plant within the next two months.

AS per report, the new plant, named Zamzam 2, will be the biggest DRI plant in Iran with a production capacity of 1 million tones per year.

It is a part of the company’s improvement and expansion program, which will increase KSC’s steel capacity to 3.2 million tonne per year from the current 2.4 million tonne per year.

The report added that KSC is pursuing another project to install a 1.05 million tonne per year wide plate mill. It also wants to build its own power plant to overcome Iran’s current electricity shortage.

It is reported that Turkish longs producer Kardemir has cut its prices for round bar and rebar by 13%.

As per report prices for 12mm to 22mm round bar have been reduced to TRY 1,320 per year (USD 1,103) from TRY 1,490 per tonne and rebars are TRY 1,300 per tonne (USD 1,086) from TRY 1,470 per tonne.

The report said that the new prices are effective from August 19th 2008. Kardemir last adjusted its bar prices on August 5th when they were increased.

Khaleej Times reported that Corrtech International, which is based at Ahmedabad in Gujarat State of India has entered into a joint venture with Arabian Port Company of Saudi Arabia for pipeline projects that will garner business of about INR 4,000 crores over a period of five years.

The project includes laying of pipelines, station piping work, cathodic protection work and metering skids.

Mr Amit Mittal MD of Corrtech International in information made available to Khaleej Times said that “The agreement was signed in June this year and it will be a 50:50 JV. The investment and other financial details are still being worked out.”

Corrtech is an INR 150 crore company engaged in laying oil and gas pipelines, providing specialist corrosion protection solution, maintenance of heavy duty industrial gas turbines and building city gas distribution networks. Recently, Axis Private Equity, an arm of Axis Bank, has picked up 26% stake in the company for an investment of INR 67 crores.

The company recently inaugurated a gas turbine compressor blades manufacturing unit in Changodar with a capacity to manufacture 30,000 blades a year. Mr Sandeep Mittal joint MD of Corrtech “We aim to enhance the production capacity to 200,000 blades and for this we aim to pump in PKR 40 crores in the next one year.”

It is reported that Al Atoun Steel Industries will start commercial production of square billet and long products in the 4th quarter of 2009. As per report, the date of launch of a 910,000 tonne per year meltshop and a 500,000 tonne per year bar rolling mill near Yanbu Port has been postponed for a year.

Al Atoun Steel Industries is setting up a steel plant of 910,000 tonnes of steel billets of various sizes, with a hot rolling mill with a capacity of 500,000 tonnes doing re bars from 8mm to 32 mm, rounds from 14mm to 50mm, squares from 16mm to 70mm, angles from 25mm to 55mm and several other sections, in their 1st phase of the project.

In the second phase of the project, a gas based DRI plant of 1.2 million tonnes will be set up with hot DRI charging facility into the furnace for steel making.

In the third phase facilities for wire rod rolling will be incorporated to substantiate the excess billets.

The commercial production of the first phase was slated to commission in the first half of 2009, second phase in the second half of 2010, and third phase by end 2010 respectively.

In November, it plans to start installation of a 100 tonne EAF, a 100 tonne ladle furnace, a five strand conticaster of identical capacity and a bar rolling mill. Installation of the equipment, supplied by Siemens VAI is the first stage of the project.

It is reported that Iranian producer of galvanized sheet for the automotive industry Chahrmahal Steel Sheet, will start to produce in December 2008.

The report quoted Mr Ahmed Ali Harati Nik chairman of state metals and mining holding corporation Imidro on a recent visit to the site in central Iran’s Chahrmahal province said that construction of the plant is 80% complete.

He said that the new works includes cold rolling and hot dip galvanizing facilities with a production capacity of 300,000 tonnes per year and expected to source coil from Mobarakeh Steel Co.

Business Recorder reported that Pakistan’s Federal Board of Revenue has given option to iron and steel sector either to operate under the standard value added tax regime or pay sales tax on the basis of electricity consumption.

The board has amended Sales Tax Special Procedures Rules, 2007 through SRO 862(I)/2008 issued on Friday. The amended rules have also prescribed new amounts of sales tax, to be mentioned on invoices issued by registered persons in steel sector. The new amounts are based on the rate of 16% whereas old rates were based on 15% sales tax.

Sources told Business Recorder that the board has given this option to the iron and steel sector following a decision of Lahore High Court. The amended procedure has been announced to allow the units to pay sales tax on the basis of electricity consumption or standard sales tax regime.

Sources said that the steel makers and re rolling mills of Karachi and Rawalpindi were paying sales tax on the basis of electricity consumption. On the other hand, units of Lahore and Gujranwala had approached Lahore High Court against the payment of sales tax on basis of electricity units consumed by them. Lahore High Court ruled that electricity consumption could not form the basis for charging sales tax. Now, the amended rules would provide option to steel sector units to operate in VAT mode and conditions have been prescribed for payment of sales tax under the Sales Tax Special Procedures Rules, 2007.

Sources said that the amended procedure has prescribed limits for claiming input tax adjustment and minimum values of billets or ingots etc for payment of sales tax by the iron and steel sector. Under new rule the steel makers and re rollers may opt to pay sales tax on ad valorem basis after deduction of input tax paid on their inputs subject to limits and conditions.

TradeArabia News Service reported that Dubai based Select Group has awarded the construction contract of its Pacific project on the Al Marjan Island to the Ras Al Khaimah based Construction Technology Contracting.

Pacific valued at a total of AED 1 billion is a joint development of Select Group in partnership with the UK based Select Property. It will comprise 6 contemporary, architecturally spectacular properties each named after Pacific islands.

Mr Rahail Aslam CEO of Select Group said that “Pacific is an exclusive waterfront project one of our first developments in the Northern Emirates of Ras Al Khaimah in partnership with the UK based Select Property. The contract has been awarded to CTC after careful evaluation of their capabilities and we are convinced that they are the right construction partner for the project which is due for completion in 2011.”

Mr Aslam said that “Pacific has been conceived in the backdrop of increasing investment interest in the realty sector of Ras Al Khaimah promising attractive return on investment. Our projection for Pacific is to deliver 20% capital appreciation per annum and rental yields of 10%.” He added that Al Marjan Island is similar to Palm Jumeirah in Dubai which has rewarded its investors with returns in the range of 400% to 500% since the launch in 2002. Together, the project will be spread across 25,300 square meter on the top isle of Al Marjan Island offering panoramic views of the Gulf and the natural surroundings of Ras Al Khaimah.

Designed by award winning architects JRHP, Pacific will consist of studios, 1 and 2 bed room apartments, duplexes, Pacific Suites and Gulf Suites. The price of units will start from AED 582,230 for a studio, AED 777,398 for 1 bed room apartments, AED 946,904 for 2 bed Pacific Suites and AED 1,214,369 for 2 bed Gulf Suites. All properties benefit from a private beach and 5 star amenities including rooftop infinity pools, health club, spa, 24-hour security maid and concierge service.

PRESS TV quoted a senior Turkish official as saying that Turkey will not sign the USD 3.5 billion gas deal with Iran due to a disagreement over the 'buy-back' system.

Iran and Turkey signed a preliminary deal in 2007 under which Turkey agreed to carry natural gas from Iran and Turkmenistan to Europe and to develop three gas fields in Iran. However, they failed to conclude the deal during the Iranian President Mahmoud Ahmadinejad's two day visit to Turkey last week.

Under the preliminary agreement Turkey would produce 20.4 billion cubic meters of natural gas from Iran's South Pars gas field. The joint investment of the two countries would amount to USD 3.5 billion.

Under a buy back contract Turkey would receive remuneration for its investment in the form of an allocated production share over a 25 year period.

The state run National Iranian Oil Company has recently signed buy back contracts with Indonesia, Italy and Croatia. However, the Turkish energy official stated that the buy-back contract offers 'serious risks' to Turkey in terms of pricing. Turkey wants to buy gas directly from Iran, and would like Iran to guarantee its continued contribution to investment.

Reuters quoted the source as saying that "The investment model applied to the oil and gas system in Iran is not in a language that investors can understand. Iran must develop new investment models and open the way for investments from countries like Turkey. Iran must soften its buy back model.”

Mr Hilmi Guler Turkey's Energy Minister has denied rumors that pressure form the White House prevented Turkey from signing an energy deal with Iran, and has expressed hope that the negotiations with Iran will be concluded within a month. He said that "In the memorandum of understanding Turkey took serious risks. But based on an assessment, this agreement will not be signed under present conditions and the process will continue.”

Saudi Press Agency reported that Iraq and Lebanon plan to sign a series of trade agreements in coming weeks including one on Iraq exporting oil to Lebanon.

The Associated Press reported that Mr Fuad Saniora's PM of Lebanese one day trip to Baghdad was only the third such visit by a top Arab leader since the US led invasion in 2003.

At a news conference alongside Mr Nouri al-Maliki PM of Iraqi said Mr Saniora offered support for Iraq and urged other Arab states to do the same. He said that I do believe that Iraq's return to the Arabs and the Arabs' return to Iraq is a key goal and we all have to work to achieve it.

Mr Al Maliki said that the 2 countries would sign several agreements including 1 outlining Iraqi oil exports to Lebanon, but provided no details. There were talks about oil, cooperation in the oil industry, oil exports and supplying Lebanon with Iraqi oil according to an agreement.

Mr Saniora who was accompanied by 4 Cabinet ministers said that the agreements would be signed in coming weeks. He added that he found a strong will from the Iraqi government to start cooperation in this field.

It is reported that Baoshan Iron & Steel Co may cut prices for the first time this year for the fourth quarter, following reductions by competitors.

Ms Helen Lau of Daiwa Securities Group Inc's said that BaoSteel may lower benchmark prices by CNY 200 or 3.6% from CNY 5,600 per tonne.

Mr Feng Zhang of JP Morgan Chase & Co's said that prices may fall by 5% to 10%.

Mr Luo Wei a Shanghai based analyst with China International Capital Corp told Bloomberg News that Baoshan is under pressure from customers to lower prices. He said “The gap on the spot price is as big as CNY 1,000 per tonne. But Baoshan's price cut, if any, won't be a steep one because of the consideration that there could be a possible rebound in steel prices later this year.”

According to Beijing Antaike Information Development Co Baoshan, Angang Steel Co and other Chinese steel makers may face a profit squeeze as new plants open, raw material costs jump and demand slows. Domestic steel prices, which have gained 23% this year to a record on June 5th are heading for a fifth straight week of decline."

It is reported that there is almost no transaction of HRC exports from China since there is few overseas takers at moment. Buyers are just checking prices and they are not likely to imports when prices are still diving.

Domestic HRC prices are still on the decrease. On Shanghai market, commercial 4.75mm to 12mm HRC in 1500mm width was at CNY 4900 per tonne to CNY 4950 per tonne down by CNY 300 per tonne CNY 320 per tonne from last Tuesday. That for 1800 wide products was at CNY 5350 per tonne. That for commodity grade 2.75mm HRC went down by CNY 280 per tonne to CNY 5900 per tonne.

Export offers for Q235 or SS400 grade 4.75mm to 12mm HRC have slipped to USD 910 per tonne FOB to USD 930 per tonne FOB and transaction prices are said to be as low as USD 890 per tonne FOB to USD 910 per tonne FOB. Tier one steel mills have also lowered prices to USD 940 per tonne FOB to USD 950 per tonne FOB.

(Source from MySteel.net)

It is reported that today’s Beijing Olympics closing ceremony is unlikely to mark a symbolic downturn in the Chinese economy.

According to China’s National Development and Research Commission, the roughly USD 43 billion spent on Games related infrastructure accounted for just 1% of China’s fixed assets investment between 2005 and 2008.

It said that since being awarded the 2008 Games in 2001, China’s economy has grown at an average rate of 10.5%. The Olympics would not be a watershed for China’s economic growth. It added that out of that Beijing accounts for just 3.6% of China’s gross domestic product.

The Shanghai World Expo and the 16th Asian Games in Guanzhou, both being held in 2010 will maintain high levels of infrastructure investment. Other major projects include Beijing’s metro expansion and high speed rail links in eastern China.

It is reported that China's efforts in iron ore clearance have yet to reap desirable outcome and iron ore stockpiles at most Chinese seaports continue to move up due mainly to reduced demand caused by steel output cutback.

Figures from Mysteel show ore stock at China's seaports adds 0.38 million tonnes to 73.42 million tonnes in the week ended August 17th almost setting a new record each week in recent weeks.

Latest data from customs shows China's iron ore import hits a three month high at 39.63 million tonnes in July up by 4.8% from the month before and 17.9% from the same period last year. However, domestic steel market has stepped downward path resulted from the weakening market sentiment, which in turn leads to iron ore demand decrease and then, pressing down spot ore prices.

An official from Fuzhou based Capital Company said that "The global economy slowdown especially the declining fixed asset investment has directly put a cap on steel demand."

Mr Yang Yanling VP of Tianjin Steel said that “30 million tonnes to 40 million tonnes of ore stock is rational based on domestic demand for imported ore. Difficulty in iron ore clearance will be improved after iron ore prices falling down, since traders will see no profit in iron ore imports by then.”

Medium and small steel mills expect the spot ore prices to dip lower, and are steering away from the spot ore import market despite the overall price fall of CNY 40 per tonne to CNY 60 per tonne in previous week, which has intensified the huge ore stocks at seaports. Meanwhile, most small mills have been forced to halt production due to the falling steel prices and record input costs, leaving their ore stocks at seaports. And the transportation difficulties during Olympics also slowed the pace in iron ore clearance.

It is reported that China National Petroleum Corp will start its negotiations within this year on pipe deals for shipments in 2009 for China's new West East natural gas pipeline project because CNPC is contemplating forming a budget in October for construction of the east part of WEPP-2.

Japanese integrated steelmakers are setting their sights on the X80 grade in the UO pipe exports they negotiate with CNPC in relation to line pipe supplies for WEPP-2. The Japanese steelmakers believe that CNPC will place almost all of its orders for X70 UO pipes with Chinese steel mills.

It is likely that Japan's integrated steelmakers will offer UO pipe exports to CNPC at USD 2,000 per tonne FOB or beyond when the two sides enter negotiations. Japanese export deal of heavy plates for Russia recently shaped up at USD 1,700 per tonne FOB for UO pipe material.


Until now, CNPC has bought a total of 230,000 tonnes to 240,000 tonnes of UO pipes from Japan at around USD 1,500 per tonne FOB for construction of the west part of WEPP-2. UO pipe requirements in WEPP-2 are estimated at a total of 800,000 tonnes for the X80 grade and 600,000 tonnes for the X70 grade.

It is reported that Handan Zongheng Iron & Steel will commission a 2 million tonnes per year hot strip mill by the end of this month and will put another 4 million tonnes per year HR mill on stream in March next year.

The two mills are located in Zongheng’s brand new Cangzhou 6 million tonnes per year steel complex near a sea port in Bohai coastal area.

As per report, the 2 million tonnes per year mill has a width of 1250mm and is capable of producing HRC 2.0mm to 20mm thick and 860mm to 1150mm wide, while the other mill with a width of 1780mm will produce HRC 2.5mm to 20mm thick and 900mm to 1600mm wide.

Output from these two mills will mainly be used in re rolling and construction.

For upstream facilities, the new complex has three 2500 cubic meter blast furnaces and three 180 tonnes converters.

It is reported that, the government of Inner Mongolia Autonomous Region issued a notice saying that the government decided to raise the electricity price for ferroalloy production CNY by 0.07 per KWH since September which will add CNY 600 per tonne to CNY 700 per tonne of production cost for the ferrosilicon producers.

According to the Notice on Several Questions about the Electricity Price in Gansu Province and Guangxi Autonomous Region by National Reform and Development Commission, the price in two province and region will be partly raised.

According the participants, the rise in electricity price will no doubt add pressure to the producers. CNY 0.07 per KWH means CNY 600 to CNY 700 per tonne increase in production cost for the ferrosilicon producers therefore they have to raise the products sale prices in turn. Offer prices of ferrosilicon have moved up in Wuhai, with silicon 75% product ex work offer up to CNY 8,400 per tonne to CNY 8,500 per tonne, silicon 72% offer to CNY 7,800 per tonne to CNY 8,000 per tonne.

Recently offer of silicon 75% ferrosilicon from E’erduosi came to CNY 8,400 per tonne to CNY 8,500 per tonne and that of silicon 72% ferrosilicon came to CNY 8,100 per tonne to CNY 8,200 per tonne, both of ex-work prices. With the offer in Shizuishan Ningxia was CNY 7,800 per tonne to CNY 7,900 per tonne and CNY 7,600 per tonne to CNY 7,700 per tonne respectively.

According to China Iron and Steel Association monthly report, China’s steel price index slipped for the first time in July.

It shed 0.48 points or 0.3% MoM to 160.99 points in July amid slight price falling spreading home steel markets.

The report said the demand in the rest of the year is expected to keep unchanged in view of the government's macro adjustment policies and China's current economic situation. Chinese steel enterprises have to face challenges a rising from rocketing costs, including high prices of electricity and transport and low market demands. By the end of July, steel stocks in Beijing, Shanghai and Guangzhou were all on the downward side.

It is reported that Shougang marketing companies for sale at the plate completed sales tasks of July. The Ship Plate sales of 67,200 tonnes went up by 52.46% MoM and selling prices went up by CNY 385 per tonne than last month.
Three reasons are

1. The implementation of the contract ensures the maximization of benefits. In July, Shouqin ordered 3000 tonnes of X70 Pipeline Steel.

2. The development of new customers to expand sales channels of plate. Such as Qinhuangdao Gangzheng, Qinhuangdao Tunze, Maanshan Kaiming etc.

3. To normalize plate marketing. In July the contracts of normalizing board was a total of 31,089 tonnes assessment, the practical implementation of signed contracts 17,270 tonnes.

It is reported that the three largest ocean going ports in China’s southwestern Guangxi province will unite in a CNY 2.22 billion deal between Shenzhen listed Beihai Port Co and state owned Guangxi Beibu Gulf International Port Group.

BPC said recently it would buy a 70% stake in Fangcheng Port Group and 100% of Qinzhou Port Group, which are together worth CNY 2.22 billion from GBGIPG. The purchase will group together the Beihai, Fangcheng and Qinzhou ports in southwest China’s Beibu Gulf. The Shenzhen listed port developer will issue 288 million additional shares at CNY 7.71 apiece to GBGIPG by way of payment, which could make the state-owned company BPC’s largest shareholder.

BPC said in a statement that the aim of the deals was to consolidate the port assets in the province and avert competition. It said that the three ports are expected to have a combined capacity of 100 million tonnes by 2010.

It is reported that recently Beijing Shougang Jingtang Company’s 565 tonne weight desalination equipment of sea water hoisted the main evaporator in place, what marks the company’s desalination project has entered a new stage.

The company’s production and living water comes from two sources: reservoir water supply and sea water desalination. Desalination is an important way for the company to solve problems of water shortage and achieve sustainable use of water resources and also is an important manifestation of the economic cycle of the project.

After the desalination, the water is close to pure water that can meet the iron smelting, steel, steel rolling production such as the use of high quality cooling water needs. The implementation of desalination, annual savings of 20 million tonnes of fresh water for the community to provide concentrated brine 18 million tonnes.

It is reported that CMA CGM Group will sign a 50 year concession agreement to build and operate a container terminal in the Port of Tianjin in North China.

The French line said in a statement that the new terminal, which is expected to become operational in 2011 and will feature a 1,100 meter quay and an annual capacity of 1.7 million TEUs. It said the terminal lo