The Telegraph reported that Steel Authority of India Limited will set up INR 200 crore steel processing unit in Assam’s capital. The foundation stone of the project is expected be laid in the last week of October or early November.

Mr Ram Vilas Paswan Union minister for chemicals and fertilizers and steel said that the site for the project has been identified at Tilingaon in north Guwahati. The Centre has paid INR 8 crore to Dispur to acquire 32 acres of land for the purpose.

Mr Paswan said that the process of setting up the plant has been progressing very fast because of the support from the state government.

Mr Paswan said that “The Steel Authority of India Limited has been asked to set up the steel processing unit in Guwahati with an aim to producing steel products for consumption in the region which is witnessing a boom in the infrastructure and housing sectors at present.”

He added that “The setting up of the unit is an important endeavour of my ministry to speed up industrial development of those states where steel making facilities are non existent. The completion of the steel processing unit will create employment opportunities for local youths.”

Indian domestic steel prices for long products remained weak on September 17th 2008.

ILPPI – Indian Long Product Price Index
IFPPI – Indian Flat Product Price Index
INDSPI – Indian Steel Price Index

Long products

Flat products

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

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JSW Steel Limited said that it expects prices and demand for the metal will revive after next month as companies lower production.

Mr Seshagiri Rao finance director of JSW Steel said that “There may be some supply side adjustments but we can expect some revival in demand after October. Also, the cost of production remains high as coal prices has not fallen.”

It is reported that Mr T Subbarami Reddy member & former minister of Rajya Sabha had appealed to Mr Manmohan Singh PM of India to initiate steps for the merger of National Mineral Development Corporation with the Rashtriya Ispat Nigam Limited.

In a letter to the PM, the MP pointed out that the VSP has no iron ores of its own and had been purchasing the same from NMDC and others at a high cost.

He said that if things were allowed to continue like this, the VSP which had been doing exceedingly well and earning good profits would become sick in future. The VSP had applied for iron ore to iron ore rich States like Orissa, Chattisgarh and Jharkand. But the request was turned down.

He stated in his letter that since both VSP and NMDC are public sector undertakings under the Ministry of Steel a merger would be convenient.

BS reported that a high level meeting between involving East Coast Railway and National Mineral Development Corporation held on September 17th 2008. ECoR has called upon National Mineral Development Corporation (to scale up production of iron ore.

Under the meeting Mr AK Goyal GM of ECoR negotiated with the board of directors of NMDC to find out ways and means of enhancing supply of iron ore to steel industries.

The zonal railway on its part has committed to supply adequate number of rakes to transport the ore.

The thrust of the meeting was to ensure quicker loading time of railway rakes and to avoid breakdowns in the system at the major loading heads of Kirandul and Bacheli in the Bailadila mining sector. The meeting took stock of the progress in loading of iron ore in the first part of the current financial year and also made assessment of the month-wise performance.

To optimize industrial output, the EcoR is arranging high level meetings with various corporate organizations like NMDC, Steel Authority of India Limited and Mahanadi Coalfields Limited.

BL reported that the Indian Railways seems to have agreed to Japanese condition of building the Western freight corridor with electric traction. Earlier, it had decided to build the corridor on diesel traction and the Eastern corridor on electric traction.

As per report, ministry wants to access long term soft loan from the Japan Bank for International Cooperation for the project. JBIC extends loans for 30 to 40 years at 0.2% interest. But the borrower has to spend at least 30% of the loan on Japanese firms.

Western corridor which will primarily serve the export-import container traffic between the Northern hinterland and the Western ports was envisaged to be on diesel traction to enable double stack container movement. World over international standard sized double stack containers are moved only on diesel traction as of now. China moves a mix of higher and lower height containers under electric wire at places.

However, citing environmental requirements of JBIC, Japan International Cooperation Agency which is conducting the feasibility study said that funding could be extended only if the Western corridor was electrified.

Thus in July, the Railways conducted the world’s first trial for moving international standard sized double stack containers in Daitari-Tomka section by placing the overhead electrical contact wire at a higher height of 7.45 meters.

Even if the Ministry agrees to electrify the Western corridor, it may not get Japanese loan for the entire stretch. JBIC said that it would first consider the loan only for the Rewari-Vadodara section of the corridor. The Vadodara-Mumbai section comprises several bridges and accounts for 20% to 25% of the total cost. The Railway Ministry currently pegs the construction of the entire Western corridor at INR 23,680 crore. Funding pattern comprises internal accruals, budgetary support and debt.

BL reported that cargo handled at the 12 major ports increased by 8.37% to 221 million tonnes during April to August 2008 compared with 204 million tonnes handled in the corresponding period of last year. However, the ports missed the target set by the Shipping Ministry by 5.39%.

According to tentative data released by the Indian Ports Association, only Kandla, Ennore and Visakhapatnam surpassed the Ministry’s target set for April to August 2008.

As per report, except for Kochi and Mumbai all other ports showed a positive growth during April to August 2008 compared with the corresponding period last year. Among all the ports, Kandla port showed the highest growth in cargo handling during April to August 2008 with a 23.40% increase to 31.93 million tonnes.

The IPA data said that JNPT was second with a 18.29% increase to 25.39 million tonnes and Mormugao was third with 12.50% growth to 12.38 million tonnes.

BL reported that the future of the TATA Motors small car project in Singur continues to remain uncertain even as Trinamool Congress leader

AS per report, Ms Mamata Banerjee conceded that she would have no objection to ancillary units being set up on 100 acres within the small car project area. But she reiterated her stand that 300 areas from within the project area must be returned to the unwilling farmers.

Ms Banerjee said that she wanted the Nano project to come up in Singur. The mother plant could come up on 600 acres and ancillaries on another 100 acres. The balance 300 acres available within the project area must be returned to the unwilling farmers. Another 100 acres could be returned from adjacent areas.

Ms Banerjee’s statement marked a departure from her earlier position that ancillary units must be relocated across the road on Durgapur Expressway.

Ms Banerjee further added that she would decide on her next course of action after meeting the Governor after the latter returns to Kolkata on September 19th. She did not rule out resumption of her agitation which currently stands suspended.

It is reported that Heavy Engineering Corporation added 1 more feather to its already crowded cap when it successfully handed over an important part of a nuclear plant to Bhabha Atomic Research Centre in Mumbai.

As per report, HEC has successfully initiated, developed and produced special quality forgings meant for BARC. The company has fulfilled the stringent quality requirements of forgings with the strong support and single point clearance from BARC which has been instrumental in nurturing the special project with HEC.

It is reported that the Indian government has set a cargo handling target of 55 million tonnes for Paradip Port Trust for 2008-09 although port trust had contested this target and had pressed for a downward revision.

The report cited a port official as saying that Paradip Port is the only major port that did not deal with crude oil a commodity that has been responsible for a large share in the growth of major ports' cargo.

He added that “PPT is expected to begin handling crude oil when the single point mooring of Indian Oil Corporation Limited at Paradip is commissioned in the next 2 years. Once this happens, cargo volumes at PPT will be bolstered by around 15 million tonnes per annum with a possibility of the east coast port turning into a petroleum hub.”

In the medium to long term, several mega steel projects are expected to commission in Orissa. This will give a fillip to handling of iron ore and coal two key inputs in steel making. In 2007-08, the east coast port enjoyed a 10.2% growth in cargo handling at 42.438 million tonnes. In the Q1 of 2008-09, the port handled 11.303 million tonnes of cargo up by 17.3% from 9.636 million tonnes in the same quarter last year.

Paradip Port currently accounts for around 8% of the total cargo handled by major ports. Fertilizers, iron ore and coal fertilizers today account for a large proportion of cargo handled.

Reuters reported that Indian mild steel ingot futures are expected to be bearish on falling spot prices in international and local markets and a government official's remark expecting prices to track that trend.

Mr Vishal Maniyar steel analyst with Karvy Comtrade Limited said that “The market is likely to trade sideways with a negative bias.” He said that the prices of sponge iron in spot market has fallen more than 21% to INR 22,190 tonnes in a month, while international prices have also slid sharply.

An analyst with Motilal Oswal Commodities Broker Private Limited said that "The demand has fallen due to the monsoon and is expected remain on the downside keeping prices bearish."

Mild steel ingot future on NCDEX is the most traded product in the ferrous metal category in India.

BL reported that the recent fall in coal prices may bring some relief to the margins of cement companies compared to the preceding quarters. Having taken cues from falling oil prices, global coal prices have corrected by 23% to USD 150 per tonnes levels from the record high of USD 195 per tonnes.

The cement industry’s coal consumption is on a steady increase with coal accounting for nearly 15% of the total expenditure of the cement companies. With coal prices having doubled since last year, cement manufacturers reported shrinking operating profit margins in recent quarters, especially as their end prices were pressured by regulatory measures to contain inflation.

The report added that North based cement producers which couldn’t pass on input cost increases to the consumers could be the key beneficiaries of this trend of cooling input prices.

The current correction in coal prices have tracked similar trends in crude oil which after touching a peak of USD 147 per barrel on July 11th has drifted down to present levels of USD 93. Falling oil and gas prices which have resulted in a shift in usage from coal to the former have moderated coal prices. Falling oil prices could also cut freight costs, anther key element of cost for cement producers.

Livemint reported that Essar Power Limited and TATA Power Company Limited have submitted bids for setting up four different hydroelectric projects in Himachal Pradesh with a total capacity of 1,125 MW at an estimated cost of at least INR 8,000 crore.

The report said that apart from these 2, Himachal Pradesh Power Corporation Limited, L&T Power Development Limited, Madhucon Projects Limited and Moser Baer India Limited are the other companies that have bid for all the four projects.

The report added that Jindal Steel and Power Limited, JSW Energy Limited, Aravali Properties Private Limited, Bhilwara Energy Limited, CESC Limited, Indiabulls Hydro Energy Limited, Kalpataru Power Transmission Limited and Patel Engineering Limited were among companies that have submitted bid for one or two projects.

As per report, Himachal Pradesh plans to set up 4 hydroelectric plants totaling 1,125MW at an estimated cost of INR 8,000 crore. According to a person familiar with the development, but did not want to be named, the state plans to set up 4 hydro projects in Seli, Reoli Dugli, Sach Khas and Dugar.

According to industry estimates, the cost of setting up a 1,000 MW hydroelectric plant would be anywhere between INR 5,500 crore and INR 8,000 crore. While setting up of a 1,000 MW of gas based power will cost INR 3500 crore, coal based power will cost INR 4,500 crore. The cost of hydroelectric power is purely dependent on the construction of the dam and its height. The cost of the project will be estimated only after winning the bid. The selection criterion is based on the quantum of free power supplied to the state.

Livemint reported that the crisis rumbling through the global economy since the start of 2008 has taken its toll on the value of the world’s most iconic brands, besides savaging the financial industry and markets. But TATA, the only Indian brand that ranked among the world’s top 100 in a global league chart, ascended 6 slots, profiting from its determined marketing push.

According to Brand Finance Global 500, the world’s leading brand by value as of August 2008 was retailer Wal Mart Stores Inc which rose from the fourth spot to dethrone beverage maker Coca Cola Company, a league chart compiled by UK based consultancy Brand Finance Plc. It is an update of the consultancy’s BF Global March 2008 chart which was based on brand values at the end of 2007. The updated BF Global 500 shows that General Electric Company, HSBC Holdings Plc and Hewlett Packard Company remain at numbers 6, 7 and 8 respectively. Vodafone Plc. has moved up from 11 to 9 and Nokia Oyj inched down to 10 from 9.

The umbrella TATA brand which was the only Indian brand among the top 100 by value in BF’s March league chart, jumped to 51 in the updated rankings from 57. Its brand value has risen from USD 11.79 billion as of 2007 to USD 11.85 billion as of August 2008.

TATA is the only Indian brand in the top 100 ahead of iconic brands such as Sony, Ford and Nintendo. The TATA brand has overtaken iconic names such as Sony Corp., Ford Motor Company, Nintendo Company Limited, Generali Group, Goldman Sachs Group Inc., Carrefour Group and Credit Suisse that were ahead of it in the March 2008 league table.

Mr Unni Krishnan MD of Brand Finance India Private Limited said that this is a signal that the global recessionary environment is a unique opportunity for Indian companies to make a mark on the brand stage by focusing on long term brand investments as TATA has.

Project Today reported that Brahmaputra Cracker & Polymer has finalized the technology licensors for polyethylene and polypropylene products for its petrochemical plant being set up at Lepetkata in Dibrugarh district of Assam.

The licensor for LLDPE/HDPE swing unit is INEOS Technology, UK and that for polypropylene unit is Lummus Technologies, Germany. The licensor for Cracker unit is targeted to be awarded by September 19th 2008.

The milestones for the project already achieved include the award of licensor ship for C2+ extraction units, gas sweetening units, gas dehydration units and basic design & engineering which has already been completed detailed design & engineering is in progress. While the contract for construction power works and railway siding study work have been awarded, the contracts for administrative block, site office, site grading-I, plant and non plant buildings is targeted to be completed by end September 2008.

Major portion of land for the plant has been acquired and necessary environmental clearances both from state and centre have been obtained. Gas supply agreements with Oil India and ONGC and the term sheet agreement for naphtha with NRL are in place, thereby making the feedstock secured for the plant.

BCPL promoted by GAIL holds 70% equity participation and the remaining 30% equity is shared equally among OIL, NRL and Assam government.

BL cited Ms Annie Marie Idrac minister of State for External Trade of French as saying that the Indo-French nuclear cooperation would get a shot in the arm when Dr Manmohan Singh PM of India goes to France at the end of this month for a bilateral meeting with both the countries likely to sign a cooperation pact in civilian nuclear energy.

Ms Idrac at a press conference soon after signing of the protocol of the 15th meeting of the Indo-French joint committee said that “The NSG decision is a historic achievement. It will pave the way for signing of bilateral agreement, which was concluded during the President Mr Sarkozy’s visit to India in January. We are discussing the exact date with the Government of India and hoping that cooperation will begin as soon as possible. We want to be key partner of India.”

Mr Kamal Nath Union Commerce & Industry Minister said that he cannot comment on the matter but added that India will be looking at the best opportunities for nuclear trade within the parameters of NSG clearance with any country.

Mr Nath said that “We all know France has technical expertise in that. France has been engaging with India in the past. France has maximum number of reactors in the world. India will be looking at the opportunity in any case.” Meanwhile, Mr Nath added that the French President’s visit to India and the PM forthcoming visit to France would create a new momentum and new impetus in trade and investments between the 2 countries.

BL reported that the Department of Shipping will introduce the Shipping Trade Practices Bill 2008 to tighten trade practices adopted by service providers in transportation of containerized cargo.

While the original Shipping Trade Practices Act 2006 was aimed at shipping intermediaries across all cargo handling categories, the present version will be applicable only to containerized cargo.

The preamble of the Bill will go to the Union Cabinet and then to the Parliament for clearance. The Department of Shipping has circulated a draft copy of the Bill to different stake holders for comments and proposals. Since container trade will be the future, the Government wants to bring in more transparency in this sector.

The report said that “The Bill is to provide for bringing transparency in trade practices adopted by maritime transport logistics service providers in respect of services rendered by them for arranging transportation of containerized cargo, registration of such service providers and their obligations, mode and manner of fixing tariff by the service providers, export-import and for matters connected therewith or incidental thereto.”

The STP 2008 will cover those providing services to carriage or transportation of cargo by sea or in combination with air, road or rail or any other mode, providing warehousing services including container freight station/inland container depot operations or providing services relating to stuffing and de stuffing of containers.

The Bill also makes mandatory the registration of service providers along with a bank guarantee of not less than INR 10 million tonnes. The Bill said that “If any person registered contravenes any provision of the Act or any rule made there under or commits a breach of any of conditions of the registration, shall be punishable with a fine which may extend to INR 10 million tonnes.”

India’s current share of around 8% in containerized sea cargo is expected to increase to 20% over the next 5 years. The Government aims at nearly 100 million tonnes of containerized cargo by 2011-12.

It is reported that Mr S K Sharma one of the two high profile officers Mr LN Mittal had hired for his ventures with state run Oil and Natural Gas Corp, has quit Mittal Investment Sarl to join trading house Glencore.

Mr Mittal had hired Mr Sharma a BPCL executive in October 2005 to head his oil and gas trading venture ONGC-Mittal Energy Services Ltd. In October last year, he was moved to Mittal Investment Sarl after almost winding up OMESL as ONGC showed little interest in the venture.

Sources said that Mr Sharma earlier this month quit Mittal Investment Sarl, the Luxembourg registered holding company of Mittal family, to join Glencore.

It is reported that Rocksource ASA on September 15th 2008 has signed an agreement with Oil & Natural Gas Corporation to pick up 10% stake in latter's Cauvery deepwater Block CY-DWN-2001/1.

As per report, ONGC the operator in the proposed deep water block with 55% participating interest. The other 2 partners are Oil India and Petrobras International Braspetro. The block was awarded under the NELP III round.

The report added that the agreement to assign participating interest in the block is subject to consent of Oil India and Petrobras International Braspetro and approval of the Government. After assignment of participating interest, ONGC will have 45% stake in the block, Oil India 20%, Petrobras 25% and Rocksource 10%.

ArcelorMittal said that it can cut production by 15% in Europe and US to support prices as global growth slows.

Mr LN Mittal chairman & CEO of ArcelorMittal said that global demand is still strong and the credit crisis has not had a major impact on its customers. He added that "There will be softness in the market in the fourth quarter, but we think this is only temporary.''

ArcelorMittal is reassuring investors after its South African unit said last month prices for some types of steel will be reduced for the first time in a year. Hot rolled steel coil fell 5.1% in August 2008, the first monthly decline in more than a year.

Reuters reported that European steelmakers are hopeful that EU regulators will take a tough line on miner BHP Billiton's proposed USD 115 billion takeover of Rio Tinto due to competition concerns about iron ore and coal. Steelmakers, faced with price hikes in iron ore of 65% to 71% this year are worried that combining Rio and BHP might boost their pricing power and tighten supplies.

Mr Gordon Moffat director general of industry body Eurofer said that "We are quite encouraged actually by the degree of resources and the commitment which they are putting to the process at this stage. EU officials have tended to really put a quite significant degree of interrogative questions to us during the hearings, which is encouraging from our point of view, which means they are treating this seriously."

Mr Moffat said that steelmakers are against a merger in any form, even with potential disposals. He added that "The merger is unacceptable in any case, given the degree of concentration which already exists in the industry, and I cannot see at this stage how remedies could be formulated to overcome that problem."

He said EU investigators were giving the case a very detailed examination and asking tough questions in hearings. He added that "We would like to think that the questions they are asking in a sense are casting the propositions which we put forward with regards to this merger."

European Commission said on September 2nd 2008 that it had suspended the merger review as it waited for more information. BHP said it was working to provide it, but stopping the clock was a routine move in complex cases involving huge amounts of data. EU previously said it was due to conclude the case by December 9th 2008, but the suspension will push back the date.

According to latest monthly bulletin by International Lead & Zinc Study Group, the global zinc market was in surplus by 77,000 tonnes in January to July 2008 period.

Global refined zinc use rose to 6.775 million tonnes from 6.575 million a year earlier. World refined zinc output was 6.852 million tonnes in the January to July period, up from 6.591 million tonnes a year earlier.

In '000 tonnes

India with vast resources of iron ore, abundantly available low cost skilled manpower and the prospects of a strongly growing steel market provided huge opportunities to invest in the steel industry for new capacity. With a strong technical manpower, a history of steel making and a supportive government, there was no doubt that despite a few well known constraints, India had the chance to outperform her peers in attracting investments into the steel sector from all over the world.

Dreams were large, from a small company producing steel only in thousands of tonnes to global behemoths such as Arcelor Mittal Steel, POSCO, SAIL, TATA Steel, Essar Steel, Ispat Industries and JSW Steel doing so in millions of tonnes, all came out strongly to become part of this Indian steel dream. All of them had large Greenfield and Brownfield steel projects to add capacity. If one has to go by their ideas, the Indian steel capacity should touch 400 million tonnes by 2021.

But, the reality has been different. All of them have faced some common hurdles which are well known. Concurrently, each one of them has been hit by specific problems. The current status of the projects is not as encouraging as the dreams have been.

Where do the steel projects stand today?

“Indian Steel Projects: Ground Reality, Strategic Issues and Opportunities” from Steel and Natural Resources Strategy Research analyses the context each significant producer is placed in and identifies their core problems. It makes an objective assessment of the strength and weakness of each of the major projects, when they are expected to be completed and at what cost.

It takes a macro view of the emerging steel supply scenario till 2021.

This 115 page report with 35 tables, 12 charts, a number of annexure, three maps and an appendix looks at the steel industry’s future in India from a strategic point of view to guide the investors in the industry, capital goods industry, steel traders, raw materials suppliers and the policy makers in the government in their own individual planning for the future.

Report Summary:
1. Published: Sep 2008
2. Format PDF File (Delivery by Email on receipt of payment)
3. Total no of pages – 115

Price: USD 1100 or INR 50,000
(Note: You can Save USD 100 if you order before October 15th 2008)
(Additional Charges would be levied for delivery of file on a CD or in printed form)
You can order your copy to reports@steelguru.com

ArcelorMittal said that it expected global steel demand to grow around 5% in 2008 and 4% to 4.5% in 2009.

Mr LN Mittal chairman & CEO of ArcelorMittal said that "Overall we still see a 5% growth in demand because the first three quarters have been strong."

Mr Mittal said that he expected the demand continue to be strong in 2009, with the demand mainly coming from emerging markets, mainly Russia.

Latin American Iron & Steel Institute said that crude steel production in Latin America reached 47.1 million tonnes in January to August 2008 period, up by 7.4% YoY over 43.9 million tonnes in same period last year.

Brazil contributed to growth with production of 23.9 million tonnes, up by 7.5% YoY over 22.1 million tonnes in the same period of 2007, while Mexico reported production of 12.9 million tonnes, up by 12.7% YoY as against 11.4 million tonnes in January to August 2007 period. Venezuela's production fell by 12.9% YoY from 3.3 million tonnes to 2.9 million tonnes.

Primary iron output in the region grew by 6.8% YoY to 43.7 million tonnes as compared to 40.9 million tonnes in the previous year.

Brazil's production moved from 23.4 million tonnes to 25.2 million tonnes, up by 7.9% YoY. In Mexico, the growth was 14.8% YoY from 6.8 million tonnes to 7.8 million tonnes. Venezuela registered a 9% YoY decrease, moving from 5.4 million tonnes to 4.9 million tonnes.

Hot rolled products in Latin America saw a 4.8% YoY improvement, moving from 36.6 million tonnes in January to August 2007 period to 38.4 million tonnes in the same period of 2008.

Reliance Steel & Aluminum Co announced that it has acquired the assets, including the inventory, machinery and equipment of the Singapore operation of HLN Metal Centre Pte Ltd.

The primary business of Singapore based HLN Metal involves the processing and distribution of custom machined materials and the sawing of metal products and components. The purchase price of the assets was approximately USD 2.6 million.

The business will operate as Reliance Metalcenter Asia Pacific Pte Ltd. The new business will focus primarily on supplying the electronics, semiconductor, and solar energy markets.

This acquisition represents an expansion of Reliance Steel & Aluminum Co’s presence in Asia and demonstrates the Company’s continued commitment to international growth.

BNamericas reported that employees from nearly 100 companies subcontracted by Venezuelan steelmaker Sidor took control of the mill's administrative facilities, demanding salary increases and asking to be added to the company's payroll.

As per report, in a show of support, contracted employees working on the steelmaker's first shift downed tools and partially paralyzed plant operations.

Union representatives said that "Subcontracted employees are not going to put up with this devastating salary any longer and that is why they decided to halt works at Sidor.

The protesters split forces into two groups, one took over headquarters at state heavy industry holding company CVG and the other picketed the offices of Sidor's president. They do not plan to abandon their posts until the company's board agrees to a meeting.

They warned that "If the meeting does not take place in the next few hours, we will begin taking more forceful measures and during the rest of the days left to us."

Steel bar manufacturer Gerdau MACSTEEL announced that its board of directors has approved a USD 9.4 million expansion to its heat treating operations in Indiana, creating 20 new jobs by 2011.

As part of the expansion, Gerdau will construct a new 38,000 square foot building to house a fifth quench and temper line with induction similar to the company's existing four lines located on Indiana's northwest side. Gerdau MACSTEEL, which provides hot rolled and cold finished steel bars to customers in the automotive, defense and agriculture industries, will begin hiring line associates and finishing operators next summer to accommodate the new production line.

Mr Mitch Daniels governor of Indiana said that "We continue to outrun all of our Midwestern competitors in attracting new job creating investment from companies like Gerdau MACSTEEL, but we can not let up for a minute. We can never take a rest, we have to get on to the next success and the next."

Mr Mark A Marcucci president of Gerdau MACSTEEL said that "Gerdau MACSTEEL Heat Treat is recognized as a leader in quench and tempering of long products in the steel industry and this expansion will support our commitment to our customer's needs. The project, scheduled for completion in the fall of 2009, will add 18,000 tonnes of additional bar and tube capacity, increase the size range of our products and expand our value added services."

The Indiana Economic Development Corporation offered Gerdau MACSTEEL up to USD 175,000 in performance based tax credits and up to USD 30,000 in training grants based on the company's job creation plans. The city of Huntington also awarded property tax abatements on the building and equipment additions at the request of the Huntington County United Economic Development Corporation.

Gerdau MACSTEEL is one of the largest producers of engineered steel bars in North America. The company operates manufacturing facilities in Jackson and Monroe and Fort Smith and processing facilities in Huntington and Pleasant Prairie.

ArcelorMittal has announced a new management gains plan that will target USD 4 billion of cost savings over the next 5 years.

This plan will focus on increasing employee productivity, reducing energy consumption and decreasing input costs to achieve a higher yield and improved product quality.

Mr Aditya Mittal CFO of ArcelorMittal said that "Since our merger, we have improved our cost leadership due to our successful integration, our 2008 value plan and realization of merger synergies. In order to further enhance this cost leadership, we have now targeted a further USD 4 billion of management gains to be realized over the next 5 years."

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 a control room at ArcelorMittal steel plant in south suburban Riverdale was badly damaged during a fire on September 16th 2008.

A Riverdale fire department firefighter said that t fire started about 8:30 PM local time inside a control room at Mittal Steel and was contained to the single room. The fire was extinguished about 9:15 PM. The facility was pretty damaged.

The firefighter said that some employees were at the plant, which makes steel coils, but no one was injured.

The cause of the fire is under investigation.

ArcelorMittal Steel, the former Acme Steel Company, has been located on South Perry Avenue since approximately 1910.

BNamericas reported that Brazilian railroad equipment manufacturer Amsted Maxion has sold 1,100 wagons to MRS Logística, a major iron ore carrier in Brazil owned by steelmakers such as CSN, Usiminas and Gerdau, and miner Vale.

A first delivery of 686 wagons is scheduled for December 2008, with the remaining 414 wagons expected to arrive in first quarter of 2009.

Amsted Maxion is a 50:50 JV between Brazilian railroad parts maker Iochpe Maxion and Chicago based Amsted Industries.

Iochpe Maxion also sold 32 freight wagons to Chile based Soquimich, one of the world's largest producers of industrial minerals and lithium, which it extracts exclusively from its mines in northern Chile. Delivery is expected for April 2009 at the latest.

Including these transactions, Amsted Maxion is to deliver a total of 4,615 wagons in 2008. So far, orders for 2009 amount to 446 wagons.

Fitch Ratings Agency has upgraded ArcelorMittal SA's long term issuer default rating and senior unsecured ratings to 'BBB+' from 'BBB'. At the same time, the company's short term IDR has been affirmed at 'F2'. Following the upgrade, the outlook on the long term issuer default rating is now stable.

The upgrade follows the change in ArcelorMittal SA's outlook to positive on December 14th 2007 and reflects satisfactory progress in current projects to strengthen its operational profile. Fitch believes that these new developments, combined with the company's existing scale and diversity, should enable it to record more stable financial performance relative to major peers in developed economies in the coming years.

The ratings are supported by ArcelorMittal SA's position as the world's largest steel producer with significant product and geographic diversity, a comparatively high level of raw material ownership and low-to-medium overall production costs. Fitch recognizes management's efforts to maintain a moderate financial policy while acting as a consolidator in global steel markets, and believes that the company is committed to retaining a strong investment grade rating. Further acquisition activity remains highly likely, with small to medium sized acquisitions factored into the current ratings.

Fitch believes ArcelorMittal SA would curtail its acquisition spending to maintain appropriate credit metrics for the ratings. Large debt funded acquisitions are not considered likely over the next 12 months, and would be treated as an event risk to the ratings.

The ratings are also supported by ArcelorMittal SA's strong cash flow generation which, based on the agency's base case forecasts, will continue to be sufficient to internally fund future CAPEX, dividend and share buyback payments. Constraints on the ratings continue to be the cyclicality of the steel sector combined with the inherent operational leverage of steel producers, as well as the more fragmented nature of the steel industry compared to key supplier and end customer industries.

Fitch expects ArcelorMittal SA's full year 2008 EBITDAR to be approximately USD 23 billion to USD 24 billion, with net leverage in a range of 1.1x-1.3x. Group liquidity remains strong with USD 7.5 billion of on balance sheet cash plus USD8.3bn of available credit facilities disclosed in its interim results.

Platts quoted Mr Jeffrey Kupfer acting deputy secretary of US Department of Energy as saying that Texas Gulf Coast refineries shut ahead of Hurricane Ike should be operating in a week or so. He added that "Most of the issues we are seeing with refineries is a lack of electricity. We expect it could be a week or so for the refineries to come back on."

Mr Kupfer said that US Department of Energy is still considering a request from Citgo for 1 million barrels of crude from the Strategic Petroleum Reserve. He added that "We have been as responsive as we know how to be. With some of the other requests after Gustav and Ike, we are considering the Citgo request, and taking a look at it."

Mr Kupfer said that overall, the government sees no major damage to Gulf and Gulf Coast's energy infrastructure. He added that "As the cleanup goes on, we are getting a better picture of the damage. Generally speaking, the level of damage is less than what was originally feared."

Three tankers joining the Green Award certificates scheme are two 116,000 DWT aframaxes from Arcadia Ship management Co Limited, Aegean Harmony & Aegean Nobility and the 306,000 DWT VLCC Ellinis from Chandris Hellas Inc.

The renewed certificates were given to Novoship UK Limited, Bergshav AS and BP Shipping Limited. Green Award certificates recognize high quality seagoing vessels that are considered extra safe and extra clean, a benefit for the ports that receive them.

Every year checks are made to the vessels to see if they still meet the requirements. Ports are then encouraged to offer those vessels incentives. Currently, ports in the Netherlands, Belgium, Lithuania, Spain, Portugal, South Africa and New Zealand, give Green Award vessels a premium incentive based on port dues.

Port Metro Vancouver has also joined the list of ports acknowledging the Green Award by announcing a reduction in port dues for certified ships. It marked its official participation in the scheme last month during the 50th American College Personnel Association conference in New Brunswick in Canada. Vancouver is the first port in the Americas to adopt the Green Award, according to a spokesperson at the port.

The Green Award Foundation also announced a two day seminar in Dubai in January 2009 to celebrate the Green Award's 15th anniversary. The seminar, to be held from January 19-20, is to allow an exchange of ideas between Green Award certified shipowners, ship managers and external parties about the future of quality shipping.

The Green Award Committee and Board of Experts currently includes representatives from BIMCO, INTERTANKO, IACS, OCIMF, the US Coast Guard, the North Sea Foundation, Bureau Veritas, HELMEPA, The Nautical Institute and other associations, ports and shipping concerns.

According to statistics from Clarkson, orders for most types of tankers and bulk carriers have declined so far in 2008. However, VLCCs are the exception, with 99 new units ordered between January and August 2008, taking contracting figures up by a staggering 334% YoY. No fewer than 21 new VLCCs were contracted in August alone, including a series of six 316,000 DWT vessels ordered by Ocean Tankers at Waigaoqiao for delivery in late 2011 and 2012 and four 318,000 DWT units for AP Moller and the Kuwait Oil Tanker Company, ordered at STX and Daewoo respectively and all for delivery in 2011.

Meanwhile, new ship prices continue to climb as shipbuilders try to cover higher steel prices and brace themselves for yet more increases, likely in the months ahead. Prices for all ship types are up this year, with Clarkson’s New building Price Index up more than 8% on its level one year ago. But tankers have shown double digit price rises VLCCs now cost over 14% more than they did this time last year whilst Suezmaxes are up by more than 12% and Aframax units by nearly 20%.

According to Clarkson, both Japanese and South Korean steel mills are rumored to be considering further price hikes. If yards cannot pass on raw material cost increases to their customers, then the prospect is raised that some may go out of business and some existing contracts may not be fulfilled. However, a recent report by US investment bank Morgan Stanley suggesting that USD 22.7 billion of the current order book may not get built has been criticized as too pessimistic. This would be equivalent to almost 22% of the total estimated order book value.

It is reported that POSCO has completed construction of the world's largest generation fuel cell and has now gone into active operation. This is the world's largest generation fuel cell plant with an annual capacity of 50 MW and is double the size of the previous largest fuel cell energy of Connecticut USA. The fuel cell produced in this plant is capable of providing energy to approximately 17,000 households.

The generation fuel cell transforms in series chemical energy such as coal into thermal energy, kinetic energy, and then electrical energy, and unlike the existing thermal power plants it performs electrochemical reactions to the nitrogen and oxygen within the air through which it directly creates electrical energy, so there is no loss of energy.

At present, the fuel cell market is showing a worldwide annual growth rate of over 80%, and it is expected to expand to a scale of 80 billion dollars by 2020, so the governments and corporations of developed nations such as the USA, Europe, and Japan are actively pursuing this business. As one of the next generation growth engines, POSCO proactively conducted the fuel cell business from 2003 and in order to develop the future national export industry and growth engines POSCO plans to invest KRW 170 billion until 2012.

Apart from this completed plant, POSCO will also construct another 50 MW capacity plant by 2011 and by establishing a specialized research center it will secure the source technology for generation fuel cells together with RIST and POSTECH by which it will actively develop the next generation fuel cell with 10% more generation efficiency and 20% lower production cost.

Mr Ku Taek Lee chairman of POSCO said that "The fuel cell business is the most optimal alternative that can resolve the problems of fossil fuel depletion and pollution to the earth's environment currently facing humankind, and in line with the government policy of carbon reduction and expansion of green areas a large capacity production system will be constructed, and the global commercialization of the fuel cell business will be realized through continuous technology development while nurturing Pohang into the world's mecca of the fuel cell business."

From April 2005 to April 2006, POSCO has installed generation fuel cells at RIST, Seoul Tancheon Sewage Treatment Plant and Chosun University Hospital in Gwangju and in November 2006 it installed 1 commercial fuel cell for the first time in Korea at KOSEP's Bundang Generation Plant which is currently in normal operation.

BNamericas reported that US Trade & Development Agency has approved funds to carry out a feasibility study for a heat recovery and energy efficiency project at Chilean state owned copper company Codelco's Ventanas smelter.

Codelco is considering the insertion of a heat recovery steam generator boiler into its copper refining process. The boiler would reduce the company's energy demands by capturing enough heat to cool the gases produced during refining to enable them to pass through pollution control equipment.

Opportunities to provide USTDA funded assistance to Codelco will be published on the Federal Business Opportunities website. Codelco will select the US firms that will carry out the assistance associated with the USD 422,000 grant.

The project could be replicated within the Chilean copper industry and elsewhere in Latin America, lowering Chile's power production shortfall.

Study results are expected by March 2010.

BNamericas reported that Brazilian industrial steel valves manufacturer Lupatech has signed a MoU to buy Norpatagonica for USD 3 million.

Lupatech, in a statement, said that "With this acquisition, Lupatech aims to go beyond expanding Norpatagonica's basic activities and services to bring to Argentina products manufactured by the group's Brazilian companies, such as well completion equipment, tube coating technology, sensors and monitoring of fiber optics wells."

Lupatech said that that it will retain Norpatagonica's office and administration staff in charge of Norpatagonica operations. It added that "This transaction is in line with Lupatech's strategy of expanding its services and sale of equipment with a high level of technological complexity focused on oil and gas markets and flow controls."

Norpatagonica has been providing services to the oil and gas industry for over 20 years, with a client list that includes Brazil's Petrobras, Spanish oil firm Repsol and US based Chevron.

ArcelorMittal Warszawa a subsidiary of ArcelorMittal Group inaugurates a new bar rolling mill one of the most advanced rolling lines in Europe, following an investment of EUR 80 million.

The Warsaw rolling mill is the latest ArcelorMittal investment in Poland. During the past three years, the Group invested over EUR 920 million in Polish steel plants. These included a hot rolling mill in Cracow, continuous casting in Dąbrowa Górnicza, a coating line in Świętochłowice, as well as the modernization of the wire rod mill in Sosnowiec.

The new bar rolling mill in Warsaw has a production capacity of 650 KT/year. The facility is very flexible and can manufacture rebars of 8-40 mm, plain bars of 16mm to 50 mm, as well as squares, flats, equal angles and channels. It will allow ArcelorMittal Warszawa to reach one of its strategic objectives which is to provide the complete product range and secure market share by optimal service and quality. Products are mainly intended to serve the booming construction market in Poland.

Mr Gonzalo Urquijo member of the ArcelorMittal Group Management Board said that "This investment marks the start of a new era for ArcelorMittal Warszawa, which celebrates its 50th anniversary this year. The new rolling mill completes the modern melt shop constructed at the end of the nineties and transforms the plant into a state-of-the-art mini mill. Thanks to the most advanced technologies installed, ArcelorMittal Warszawa can now further develop its production and respond to the steady demand generated by the dynamic growth of infrastructure investments in Poland.”

He added that “The rolling mill is equipped with a 160 tph walking hearth reheating furnace connected to the existing continuous caster for direct hot charging of billets. This will result in substantial energy savings. The 18 stand mill is entirely made up of heavy-duty housingless stands with automatic fast changing system for maximized mill efficiency and operational flexibility. The rolling speed is up to 18 m/s.”

Jeddah-based Okaz reported that Saudi Basic Industries Corp will lower the price of reinforced steel on the local market by SAR 175 per tonne (USD 46.7) to SAR 4,510 per tonne starting from Saturday.

It is reported that Rajhi Steel Company, the largest third iron and steel producer in Saudi Arab, is intending to increase the company's production of iron and steel products to 4.6 million tonne per year in order to meet the local demand expected in the next years.

As per report the value of the projects intended to be set up by the company during the next years will amount to USD 1 billion. This will be through setting up a mill to produce 1 million tonne of rebars per year at the outset of 2011 in Jeddah and another mill to produce direct reduction steel at the end of 2012 with a production capacity of 1.8 million tonne.

The report added that the new projects will also include expansion of the merchant steel production lines so that the production capacity of this product will reach 220,000 tonne per year.

Zawya reported that Jordan Steel has set up a fully owned melting plant to minimize the effect of raw materials price fluctuation on its performance.

Jordan Steel in a statement said that it has also signed a contract with an international firm to expand the plant in order to enable it to meet all its raw materials needsadding that the plant currently provides 50% of its needs.

It is reported that demand for flat steel products in Middle Eastern countries remains weak due to the Ramadan period.

Last week, prices were clearly falling. Although Ramadan and some weaker activities in Egypt led to a decrease in the trade quantity, some related parties are ready to start purchasing after Ramadan, and may be ready to buy at a higher price.

At the same time, flat price from South Africa to the Egyptian market is USD 930 per tonne. But Egypt can only accept a price level of USD 880 per tonne.

Last week, offers to the UAE were also falling. Russia’s price was USD 920 per tonne and Ukraine’s was USD 900 per tonne. China’s offer was between USD 880 to USD 900 per tonne.

(Sourced from YIEH.com)