Others

Indian steel mills fortunes take full turn with Rupee appreciation

BHPB report for the half year ended 31 December 2011

India long product steel mills might be perched on ephemeral height

First ever Steel Scrap Summit in India gets overwhelming response

Rio Tinto to invest USD 3.4 billion in expansion of iron ore operations in Western Australia

Turkish steel exports to Singapore surge strongly in January

China steel output slips 1pct in mid Jan - CISA

Interpipe produced pipes from the first Dniprosteel heat

Aperam announces FY 2011 segment results

Copper eases as China buyers out for the count

Iranian steel market trend in week 05 2012 - Flat products

Chinese long product price index down by 12 points on February 07

Metinvest to invest USD 8 billion into its Mariupol based steel works by 2020

Nickel contango deepens on Russian exports - JPMorgan

Japan flat aluminum shipment maintains YoY minus in Dec

Latest information on projects in India, SEA and Gulf region

Find new clients through SteelGuru platform

Vale iron ore ships face elevated cancellation risk - HSBC

ArcelorMittal not counting on Indian plans for next few years - Mr Mittal

Rio Tinto announces board and committee changes

ArcelorMittal announces Q4 and FY 2011 results

- 08 Feb 2012

ArcelorMittal has announced results for the three and twelve month periods ended December 31st 2011.

Financial highlights

In USD million, except EPS

Continuing operations

In million tonnes

Financial highlights

In USD million, except EPS

Continuing operations

In million tonnes

Financial highlights

In USD million, except EPS

Continuing operations

In million tonnes

Mr LN Mittal chairman & CEO of ArcelorMittal said that "The progressive recovery that we have been experiencing was impacted in the second half of the year by the growing uncertainty over the economic situation in Europe, which particularly affected sentiment and performance in the fourth quarter."

He added that "Nevertheless, against this backdrop ArcelorMittal delivered an improved underlying performance compared with 2010 and met our expectation of a higher EBITDA in the second half compared with the previous year. The Company continues to benefit from its diverse geographic presence and growing mining business, which delivered on its targets to increase iron-ore and coal production by 10% and 20% respectively. I must also remark on our health and safety performance, which showed an improvement in the injury frequency rate to 1.2 times in the fourth quarter."

He added that "Looking ahead to 2012, the situation in Europe remains a live concern. Despite the continued uncertainty in this market, however, we are seeing an improvement in sentiment compared with the fourth quarter. Steel shipment volumes for the first six months are expected to be similar to the first half of 2011 and we are again targeting increased production from our mining business."

USA leads world steel price recovery - MEPS

- 08 Feb 2012

According to MEPS International Limited, its US hot rolled coil benchmark selling figure increased in January 2012 by almost 4%.

There has been a pick up in market activity and transaction values are likely to go even higher. Recent mill announcements, for cost driven hikes, should be implemented in the near term. Moreover, improving economic data should support the increases.

Reversing mill plate prices have strengthened since the holidays, with delivery lead times extending to 5 to 6 weeks. End user demand is steady. Distributors and fabricators are enjoying brisk activity levels.

US mills' proposals for higher transaction values for cold rolled coil have succeeded. Selling prices firmed by approximately 3% MoM in January 2012, continuing the positive tendency. Forecasts for 2012 auto sales are encouraging and coated steel demand from that sector remains buoyant. The price advances planned for January 2012 were accepted, with mills signaling further hikes for February 2012.

An upturn in US steel consumption is envisaged for the first two quarters of this year. Higher raw material expenditure, should also add to the upward movement in selling figures in this period.

(Sourced from MEPS - International Steel Review)

ArcelorMittal announces FY 2012 outlook and guidance

- 08 Feb 2012

ArcelorMittal's EBITDA in H1 2012 is expected to be lower than H1 2011 but above H2 2011, supported by continued progress on management gains and asset optimization plans.

The company expects steel shipments in the first half of 2012 to be at a similar level to first half of 2011. Mining production is expected to be higher than in the first half of 2011 in line with plans to increase full year 2012 own iron ore and coal production by approximately 10%.

2012 CAPEX budget is expected to be approximately USD 4 to USD 4.5 billion including mining growth plans. A further reduction in net debt is anticipated due to a continued focus on working capital management and non core asset divestments, per the company's stated objective to retain its investment grade credit rating.

US weekly raw steel production up by 6.9pct YoY

- 08 Feb 2012

American Iron & Steel Industries reported that, in the week ending February 4th 2012, US domestic raw steel production was 1.907 million tons while the capability utilization rate was 77.2%. Production was 1.784 million tons in the week ending February 4th 2011, while the capability utilization then was 74.5%.

The current week production represents a 6.9% YoY increase from the same period in the previous year. Production for the week ending February 4th 2012 is up by 0.5% WoW from the previous week ending January 28th 2011 when production was 1.897 million tons and the rate of capability utilization was 76.8%.

Adjusted YTD production through February 4th 2012 was 9.490 million tons, at a capability utilization rate of 76.8%. That is a 6.1% YoY increase from the 8.944 million tons during the same period last year, when the capability utilization rate was 73.3%.

Broken down by districts, here's production for the week ending February 4th 2012

1. North East: 247
2. Great Lakes: 654
3. Midwest: 255
4. Southern: 661
5. Western: 90

(In thousands of net tons)

AISI's estimate is based on reports from companies representing about 75% of the US's raw steel capability and includes revisions for previous months.

Register for International Surface Inspection Summit in March 2012

- 08 Feb 2012

With ISIS.INDIA 2012, the focus of the International Surface Inspection Summit will yet again be on the Asian market after the event was hosted in China in 2010.

TEMA Technologie Marketing AG is organizing the conference, which will take place in Mumbai, India on 6 and 7 March, 2012.

The event addresses current developments in surface inspection for steel and nonferrous metal, with a special look at the large markets in India and throughout Asia.

Reports from research will also illustrate where the future development is headed.

Contact
Steelguru.com
Tel: +91 124 4048993
Fax: +91 124 4048994
E-Mail: research@steelguru.com

GMS weekly report on ship breaking industry for WEEK 05 2012

- 08 Feb 2012

The sheer volume of tonnage in the market pushed cash buyers to the limit this week with a number of vessels concluded and yet more proposed.

The good news though is that all sub continent markets are back to the bidding at reasonably healthy numbers once again. Bangladesh too is clearly back in the scene, having a number of vessels presently idling at anchorage and several more beached last week.

Finally, Chinese buyers were there to provide competition post New Year holidays, although not at levels of the previous few months, to the surprise of many. But with many yards already filled following their pre New Year binge on units, China's lethargy was anticipated this week.

Traditionally considered a busy time of the year, with budgets on the horizon, this year has proved no different as vessels of all types and sizes (both dry and wet) remain available for purchase amidst dreadful chartering rates. If the current activity persists, there is some doubt as to whether levels will hold up logical supply and demand fundamentals suggest they might not.

Nevertheless, there are sure to be plenty more highs and lows for the year and with all markets now back competing for tonnage, that can only be a good tiling.

For week 05 of 2012, GMS demo rankings for the week are as below:

(Sourced from GMS Weekly)

Nippon Metal sees a JPY 5.5 billion recurring loss for FY 2011

- 08 Feb 2012

Nippon Metal Industry announced that the firm expects JPY 5.5 billion of consolidated recurring loss for fiscal 2011 ending in March 2012 as compared with the breakeven outlook announced in October 2011.

The firm also expects JPY 6 billion of the net loss compared with the breakeven outlook before. The profit is impacted by lower selling price under lower nickel price at London Metal Market, slow domestic demand and unprofitable export under historical high yen rate. The firm announced zero yearend dividend for fiscal 2011.

Nippon Metal Industry posted JPY 2.981 billion of consolidated recurring loss in April to December 2011 period as compared with JPY 518 million of the loss in April to September 2011 period. The firm posted JPY 93 million of the profit in April to December 2010.

The firm posted JPY 2.322 billion of the operating loss in April to December 2011 due to lower order receipt under slow stainless steel demand. The sales decreased by 8.3% from April to December 2010. The firm posted around JPY 900 million of the valuation loss of investment securities.

(Sourced from www.japanmetalbulletin.com)

CSC to develop high grade steel products to be profitable

- 08 Feb 2012

CENS reported that China Steel Corporation will develop high grade steel products to be profitable, rather than compete with rivals from China, Japan and South Korea to raise capacity.

Reiterating the above strategy, CSC's newly appointed president Mr JY Sung said that the company will build a Great Wall of Steel by linking its production bases in Taiwan, Vietnam and India.

From now to 2015, CSC will invest some TWD 240 billion to develop itself into a small but profitable, benchmark steel mill.

Mr Sung said that high grade steel accounted for 38% of CSC's total output in 2011 and the ratio will rise to 43% in 2012. With the increased output of high grade steel products, the company will see sales increase by TWD 1.6 billion in 2012, with high grade steel products to account for over 50% of total output by 2015.

CSC has three plants undergoing construction, including the blast furnace built by its major subsidiary Dragon Steel Corporation, a cold rolled steel plant in Vietnam and an electrical sheets plant in India.

The blast furnace will roll out crude steel that will be shipped to Vietnam for processing into cold rolled steel to be sent to India to make electrical sheets for the local market, which procures 60,000 tonnes of electrical sheets from CSC yearly.

Mr Sung said that CSC's output accounts for a mere 1% of global steel production, but between 6% and 7% of global electrical sheets output.

(Sourced from www.cens.com)

Huge steel plate rolling machine now takes instructions from an iPad

- 08 Feb 2012

The largest manufacturer of offshore wind towers in Northern Europe has ordered a new DAVI heavy four roll machine with the capability rolling steel 4.0 meters wide by 145mm thick.

Davi President Mr Orazio said that "It's the largest four roll machine in the world completely dedicated to building foundations for offshore wind towers. The Davi High Productivity Package convinced that top player to buy our Wind Tower system for its benefits in building giant parts with only one operator, all the while requiring less production time than competitive machines."

The Davi Productivity Package for wind towers has been updated with the Davi iRoll CNC. The software, based on Apple iPad, lets an operator draw a part to roll and then starts production by sending the program by iPad Wi Fi to the machine.

The iRoll puts all the information about the machine at a user's fingertips. Then it connects to the Davi Service Center to dialog directly with a technician, dedicated to supply the required support.

Mr Orazio added that the European company had purchased several four roll rolling machines in 1999 and 2001, and that let it work its way into the heavy duty offshore wind market with a machine capable of rolling steel 3.600 meters wide by 125mm thick.

(Sourced from www.windpowerengineering.com)

US Steel eyeing completion of coke substitute project in 2012

- 08 Feb 2012

Officials from United States Steel Corporation affirmed that modules expected to make an alternative to the steelmaking input coke will start production in Gary in 2012.

During a conference call with analysts on January 31st 2012, Mr John Surma, chairman & CEO of US Steel, said that the project at Gary Works and its Mon Valley Works coke battery project in Clairton would come online this year with full production starting in 2013.

The modules in Gary could begin operating in a limited capacity as early as the second quarter.

Carbonyx Inc owns the technology US Steel is licensing to use in Gary. The two carbon alloy substitute production modules in Gary could produce up to 500,000 tonnes of a coal based product per year and Clairton could produce about 1 million tonnes of coke per year. US Steel said in 2010 the project carried a price tag of more than USD 220 million.

Mr Jerry Littles president of United Steelworkers Local 1014 in Gary said that "Right now, if it works as planned, we hope it's going to be a great thing."

Mr Littles said a team from Gary went to Oklahoma to work at the Carbonyx's pilot operation and better understand how to make it work in Northwest Indiana. He estimated about 450 people worked in coke operations late last year and about 80 would be transferred to work on the Carbonyx operation.

The integrated steelmaking complex in Gary still has three functioning coke batteries, which are groups of ovens that bake coal to drive off impurities to produce a product that feeds blast furnaces.

Company officials said the modules in Gary can produce a coke alternative from different types of coal and once fully operational, will result in a net reduction of airborne pollutants the facility creates from the coking process.

The Indiana Department of Environmental Management permitted US Steel to build four modules in Gary, but the company is constructing two in the current project phase. The company has yet to reveal whether it will build the next two modules. At full production, the modules would substitute about 20% of Gary Works' coke requirements.

Mr Surma said he didn't anticipate the company needing to buy coke from the merchant market this year and its production facilities should produce adequate supplies.

(Sourced from www.nwitimes.com)

Japanese ferrous scrap export price slightly lowers at Kansai Tetsugen's tender

- 08 Feb 2012

It is reported that Japanese ferrous scrap export price became JPY 30,800 per tonne FAS for H2 grade at an export tender held by Kansai Tetsugen, which is an association of scrap dealers around Osaka.

The price was lower than JPY 31,270 of the previous tender on December 9th 2011. Meanwhile, the price was higher than local electric furnace steel makers' scrap purchase prices by JPY 1,000 to JPY 1,500.

Arae Shokai, a local ferrous scrap dealer, won the bid at 5,000 tonnes. Twelve exporters submitted 12 bids for the tender while 2 eligible exporters rejected to submit.

Local electric furnaces purchase H2 at around JPY 28,500 to JPY 29,000 and some pay as high as JPY 29,500. They lowered the purchase prices several times in January 2012.

South Korean steel makers are increasing scrap procurement from Japan after Chinese New Year holidays when Japanese ferrous scrap price is lower than American ferrous scrap price. At Tokyo Bay, ferrous scrap export price rebounded slightly thanks to the sharp volume increase.

On the other hand, domestic dealers accelerated scrap shipment to steel makers in January when scrap market price downed. Thus steel makers have scrap stocks while American ferrous scrap market price currently seems stagnant, suggested one Japanese scrap dealer.

Around Tokyo Bay, scrap exporters are raising their purchasing prices by JPY 500 to JPY 1,000 to JPY 29,000 to JPY 29,500 FAS for H2 from last week. The export shipping from Tokyo Bay reached 50,000 tonnes mainly to South Korea last week.

Local electric furnaces pay JPY 29,000 to JPY 30,000 for H2 and some pay as high as JPY 30,500.

(Sourced from www.japanmetalbulletin.com)

AISI committed to working with USTR to correct errant decisions on zeroing

- 08 Feb 2012

Mr Thomas J Gibson president & CEO of American Iron & Steel Institute issued the following statement on recent developments regarding longstanding zeroing disputes:

"The American Iron & Steel Institute condemns the several rulings by the World Trade Organization against zeroing, a method of calculating antidumping duties that has long been applied in the United States and other countries. The practice of zeroing is nowhere prohibited in the WTO agreements, and the WTO rulings on this subject are a classic example of overreach by the WTO Appellate Body. Elimination of zeroing will make it easier for foreign producers to dump their products in the US market and injure US workers and businesses.

This is a case where the WTO Appellate Body got it wrong. United States Trade Representative Ron Kirk has emphasized that the Administration will continue to work to obtain a clarification that the WTO rules permit zeroing, which is critical to making our trade laws work. We strongly support this position by the Administration, and will continue to work with USTR and the Commerce Department to correct these errant decisions by the WTO."

Gerdau Sidenor opens a recycling center in Guadalajara

- 08 Feb 2012

Gerdau Sidenor has recently opened a scrap recycling facility of 24,000 square meters in the province of Guadalajara where the company receives and adapts the scrap for shipment to mills Reinosa and Basauri.

As reported by the group in a statement, the facilities, with a storage capacity of 10,000 tonnes, Gerdau Sidenor allow access to suppliers of central and southern Spain and increase the volume of scrap received from that area.

In the new facility, located in Azuqueca de Henares, Gerdau Sidenor receives, sorts, stores and prepares the scrap for shipment to the mills of the steel company in Reinosa and Basauri. This will allow providers access to central and southern Spain and increase the volume of scrap received from that area.

The center has a storage capacity of 10,000 tonnes of scrap and the possibility of direct loading to rail, which is an advantage from a logistical standpoint.

Gerdau Sidenor has production plants in the Basque Country, Cantabria, Madrid and Catalonia. The production capacity exceeds one million tonnes a year of special steels, primarily for automobile manufacturing, machinery and equipment, shipbuilding, civil, defense, energy, mining and petrochemical sector.

It also has one of the largest R&D in the steel industry in Europe focused on technological advances to optimize their processes and products.

(Sourced from www.eleconomista.es)

BDI upward trend continues on February 7 2012

- 08 Feb 2012

It is reported that on February 7th 2012, Baltic Dry Index reached 660 points, up by 12 points as compared to February 6th 2012.

Capsize

All except INDEX in USD
Change is with respect to numbers on February 6th 2012

Panamax

All except INDEX in USD
Change is with respect to numbers on February 6th 2012

Supramax

All except INDEX in USD
Change is with respect to numbers on February 6th 2012

Spot 4 TC Average = Average Value of the Four Main Shipping Routes
BDI = Weighted Composite Index of BCI/BPI/BHMI

To keep tab on steel prices in India on daily basis, subscribe to services of www.steelprices-india.com by registering or sending a mail to admin@steelprices-india.com. Please note that this is a paid service.

(Sourced from www.steelprices-india.com)

4 of East Asian major steels post struggling results in 2011

- 08 Feb 2012

JMB reported that major 4 steel makers of China, South Korea and Taiwan reported struggling results in 2011. Anshan Iron and Steel of China reported net loss while other 3 makers posted lower net profit. Their steel price increase was smaller for higher raw materials cost under slow demand in each country.

The steel demand would improve in 2012 when emerging countries loose money supply. However, international competition gets severer when steel makers shift to export market. Major steel makers' profitability could keep narrow under high raw materials cost and uncertainty in world economy.

Baoshan Iron and Steel of China posted 40% lower net profit in 2011 from record profit in 2010. The firm cannot cover higher raw materials cost despite of better sales volume and selling price. Anshan Iron and Steel expects around CNY 2.151 billion of net loss in 2011 compared with CNY 2.039 billion of net profit in 2010. The loss increased in October to December 2011 due to higher raw materials and energy cost, blast furnace repair outage and lower steel selling price.

POSCO of South Korea reported lower net profit in 2011 from 2010 due to higher raw materials cost and lower market price despite of record production and sales volume. China Steel of Taiwan posted lower profit before tax for the first time in 2 years. The firm posted the loss in December 2011 due to lower domestic market price under cheaper import.

Chinese major steel makers try to improve the profitability in 2012 through scale up by consolidation, shift to higher valued products, development of offshore project order and contract users and offshore resource investment under severe business condition. POSCO expands production and sales through wider offshore activities. China Steel focuses on offshore business.

Japanese 5 integrated steel makers announced lower profit outlook for fiscal 2011 ending March 2012 compared with former outlook by Friday. Nippon Steel expects zero net profit and other 4 makers expect net loss. Their profitability gets severer under slow demand at home and abroad and historical yen rate. The steel makers try to improve the profitability to match Asian rivals. However, their competition should get severer when Asian major steel makers try to develop export market.

(Sourced from www.japanmetalbulletin.com)

POSCO's steel output up by 10.7pct YoY in 2011

- 08 Feb 2012

It is reported that POSCO's steel production in 2011 hit its highest point ever at 37.32 million tonnes, up by 10.7% YoY as new production facilities went into operation.

POSCO said that it spent KRW 613.3 billion in research and development, up by 28.8% YoY to develop new steel products and new technologies. The steelmaker plans to announce a dividend of KRW 10,000 per share at the shareholder meeting next month.

Mr Chung Joon yang chairman of POSCO said that "We will speed up efforts to raise competitiveness and cut costs to widen the profitability gap with rival companies."

(Sourced from www.heraldm.com)

Hanjin Steel Pipe to start production of 3 inch pipes for plumbing

- 08 Feb 2012

South Korean pipe producer Hanjin Steel Pipe has announced that it plans to begin producing three inch steel pipes on February 10th 2012 at its Chonan No. 2 Plant for use in plumbing works. The new plant of the company will also be able to produce small size thick wall steel pipes for use in mechanical structures.

After the startup of the new steel pipe production facilities, Hanjin Steel Pipe will gradually relocate the main facilities of its existing plant to the new plant. During the facility relocation period, it will streamline five tubing mill units, upgrading its monthly steel pipe production capacity from 6,500 tonnes to 9,000 tonnes.

Hanjin Steel Pipe, which has so far mainly produced steel pipes for use in mechanical steel structures, is targeting diversification of its production lines with its new steel pipes for plumbing works. It is also preparing to apply for Korean Industrial Standards certification for its new steel pipes.

(Sourced from Steel Orbis)
Visit www.steelorbis.com for more

Newly formed Thamesteel task force to meet for the first time

- 08 Feb 2012

BBC reported that a task force set up to deal with the aftermath of the closure of the Thamesteel plant on the Isle of Sheppey is to meet for the first time.

The group was convened by Kent County Council after the company announced it had gone into administration. Of the 400 people employed at the site in Sheerness, 350 have lost their jobs.

The task force will look at how to support workers and liaise with administrators to secure the future of the steelworks.

It is chaired by Councilor Mr Kevin Lynes, cabinet member for regeneration and economic development, who described the company's demise as terrible news and very difficult for the workers, their families and the local economy.

He added that "Since the announcement was made by the administrators, we have been working together with Swale Borough Council in talking to government and all the key agencies about the situation. This is why we have convened a task force to look at the way forward and we have invited all relevant parties to the meeting, including the local MP, to receive an update on the situation."

Fifty workers have been retained at the site to keep it in working order while administrators seek a buyer.

(Sourced from www.bbc.co.uk)

Hsin Kuang Steel net sales fell by 31pct YoY in January

- 08 Feb 2012

Hsin Kuang Steel said that its unconsolidated sales in January 2012 fell by 31.02% to TWD 440,430,000 from TWD 638,475,000.

In '000 TWD

Jobs on the cards at Sheffield Forgemasters

- 08 Feb 2012

It is reported that jobs are set to go at a Sheffield steel plant.

Managers at Forgemasters have not yet confirmed the total number of workers they need to axe, but have started a 30 day consultation process, meaning at least 20 positions are at risk.

Unions have been told of the job losses and are urging the company to keep the numbers as low as possible.

Mr Graham Honeyman CEO of Forgemasters said that "Sheffield Forgemasters is to make a small number of jobs redundant. These are precautionary measures short-term to combat recessionary pressures and to streamline our operations, preserving the vast majority of jobs at the company and focusing firmly on the long term future. The company continues to place great value in investing in research and development, new skills and training through its award winning apprenticeships scheme, to create future manufacturing jobs for the UK and Sheffield."

He added that "Sheffield Forgemasters still has ambitious plans for capital expenditure, strong orders in many areas as a result of the flexibility of the business and its employees’ skills and is on track budget wise this financial year."

Forgemasters employs 820 staff at its Brightside Lane site.

Mr Doug Patterson, Unite's regional officer for Forgemasters, said that "Unite very much regrets the need for job losses which have been caused by worldwide pressures and competition in other parts of the world. We wish to work with the company to minimize job losses."

He added that "We don't know the exact numbers, but we will be looking to try to make sure they are as low as possible and believe the company has the same aspirations."

Meanwhile, Mr Honeyman confirmed that an investigation is under way after an employee suffered serious leg injuries in an accident at the site and was taken to hospital where he underwent surgery.

Both South Yorkshire Police and the Health and Safety Executive are investigating the circumstances surrounding the incident.

Mr Honeyman said that "At 4.30 PM on February 4th 2012, a foundry employee received leg injuries after an incident involving a vehicle. The man was transferred to Northern General Hospital where it is understood that his injuries, although serious, are not life threatening. He has subsequently undergone surgery. Police and Health and Safety Executive officials attended the site and a full investigation, conducted by the company’s Safety Director, is currently under way."

(Sourced from www.sheffieldtelegraph.co.uk)

Indian steel mills fortunes take full turn with Rupee appreciation

- 08 Feb 2012

Rally in Indian Rupee and declining international prices caused a complete reversal of fortunes for Indian mills. Nearly 6% appreciation in INR over the last 3 weeks has dealt blow to the export competitiveness of Indian mills.

In radical shift from December wherein Indian mills had been basking with insulation of severely browbeaten INR. Immense security had prompted them to hike prices in the domestic market over the last couple months by almost INR 1500 per tonne in HRC prices despite slow abject demand.

Return of confidence in Indian Rupee pulled the rug from the Indian flat product manufacturers. The import parity heavily at odds with the domestic levels February might be the penultimate month of frolic.

In per tonne

1 USD = INR 49.20

(Source: www.steelprices-india.com)

Domestic HRC retail levels at INR 37900 per tonne (excl ED and VAT) at Mumbai there is yawning gap of INR 4200 per tonne. Reportedly import bookings have commenced and with the first consignment likely to arrive by early April the era of price hike will be history soon.

If volatility in steel prices is affecting your business, keep tab on market realities and trends by subscribing to www.steelprices-india.com, which is a comprehensive portal that provides domestic pricing information for benchmark steel products in each category at select location in India on a regular basis 5 days a week and international price levels on a weekly basis.

Products covered
1. Input materials - Iron ore, scrap, sponge iron, pig iron pencil ingot, billets and blooms
2. Long products - Rebar, wire rod, angle, channel and joists
3. Flat products - Narrow plates, wide plates, HR, CR and galvanized
4. Others - Pipes

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(Sourced from www.steelprices-india.com)

BHPB report for the half year ended 31 December 2011

- 08 Feb 2012

This statement includes the consolidated results of the BHP Billiton Group, comprising BHP Billiton Limited and BHP Billiton Plc, for the half year ended 31 December 2011 compared with the half year ended 31 December 2010.

The results are prepared in accordance with IFRS and are presented in US dollars.
1. Revenue - Up by 9.7% to USD 37,480 million
2. Profit - Down by 5.5% to USD 9.941 million

Highlights
1. Strong financial results with Underlying EBITDA up 8% to USD 18.7 billion and Underlying EBIT up 6% to USD 15.7 billion. Attributable profit down 6% and Attributable profit excluding exceptional items down 7% to USD 9.9 billion

2. Underlying EBIT margin remained in excess of 40% despite significant volatility across many of our core markets while Underlying return on capital was 28%

3. Record production for two commodities and six operations.

4. Robust operating cash flow of USD 12.3 billion and a rigorous project approvals process underpin our fundamental commitment to a solid A credit rating

5. Gearing increased to 25% following the successful acquisition of Petrohawk Energy Corporation. We will continue to focus efforts on the most productive areas of our high quality Onshore US acreage as we strive to maximize economic returns from our investment program.

6. Interim dividend of 55 US cents per share, up 20%.

India long product steel mills might be perched on ephemeral height

- 08 Feb 2012

The days of frolic for Indian long product manufacturers might be on the wane. Declining international prices by about USD 40 per tonne to USD 50 per tonne for billets, re-bars and WRC has led to emergence of import propensity after gap of nearly a year.

Long product market had remained out of bounds for the Black Sea and Chinese mills during the interlude domestic levels remaining low. However with the declining export levels from Black Sea, Turkey and China has led to emergence of import threat. Domestic levels at INR 38900 per tonne (excl ED + Vat) the parity is tilted in favour of import with a gap of INR 2500 per tonne. However taking into account the import hassles parity upto INR 1500 per tonne is not enticing but add on leverage of INR 1000 per tonne would be enticing.

With the export levels poised for further decline as Chinese domestic levels remains subdued putting onus on export the days of import hitting Indian shores is in vicinity.

In per tonne

1 USD = INR 49.20

(Source: www.steelprices-india.com)

If volatility in steel prices is affecting your business, keep tab on market realities and trends by subscribing to www.steelprices-india.com, which is a comprehensive portal that provides domestic pricing information for benchmark steel products in each category at select location in India on a regular basis 5 days a week and international price levels on a weekly basis.

Products covered
1. Input materials - Iron ore, scrap, sponge iron, pig iron pencil ingot, billets and blooms
2. Long products - Rebar, wire rod, angle, channel and joists
3. Flat products - Narrow plates, wide plates, HR, CR and galvanized
4. Others - Pipes

How to subscribe
1. Register at www.steelprices-india.com and pay on line or ask for invoice
2. Send mail to admin@steelprices-india.com.
3. Call at 0091-124-3007891/2/3

(Sourced from www.steelprices-india.com)

First ever Steel Scrap Summit in India gets overwhelming response

- 08 Feb 2012

More than 250 participants from about 150 companies have confirmed to be at first ever Steel Scrap Summit on February 9th 2012 at The Palms in Gurgaon. In addition, more than 100 have confirmed participation for complimentary “Buyer Seller Interaction” in the first half of Feb 10th”

Aadi Imports Pvt Ltd
Abbeline Impex
Action Ispat & Power Pvt Ltd
Akjay Marketing Pvt Ltd
Al Jazeera Steel Products
Alamdaar Trading
All India Induction Furnaces Association
All India Steel Rerollers Association
Alok Ingots (Mumbai) Pvt Ltd
Argentum Fashions Pvt Ltd
Asha Expo & Co Ltd
Asha OreMin India Pvt Ltd
Ashram Metals & Alloys
Astar Exim Traders
Avtaar Management Solutions Pvt Ltd
Bansal alloys & Metals Pvt Ltd
Bhagyalaxmi Rolling Mill Pvt Ltd
Bhavnagar Re-rolling Mill Association
BHP Billiton
Bhushan Steels
BRG Iron & Steel Co Pvt Ltd
Britonc
Bruker AXS Analytical Instruments Pvt Ltd
Buoysail TR EST
Cellpap India Private Limited
Chetna Alloys Pvt Ltd
Chhattisgarh Mini Steel Plant Association
Concast Exim Limited
CS Casting Pvt Ltd
Darcl Logistics
Dhanlaxmi Iron Industries Ltd
East India Holdings Pvt Ltd
Economic Research Unit- Ministry of Steel
Electrotherm (India) Limited
EMR Limited
EuroTrade
Finance and Business Solutions
Global Connect
Gravita India Limited
Grayweed Consultants Pvt Ltd
Grenature Steelmaker
Guardian Castings Pvt Ltd
Gujrat Re-Rolling Mill Association
Gurudev Group of Companies
Hazel Metal & Minerals P Ltd
Heena Metal Pvt Ltd
Imagecraftz
Imran Steel
IndiaMart
Indian Institute of Metals
Indian Metal Corporation
Indo Engineers
International Commerce Ltd
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Rio Tinto to invest USD 3.4 billion in expansion of iron ore operations in Western Australia

- 08 Feb 2012

Rio Tinto has committed a further USD 3.4 billion (Rio Tinto share USD 2.9 billion) to the major expansion of its Pilbara iron ore operations in Western Australia.

The investment comprises of

1. USD 2.2 billion (Rio Tinto 100%) to extend the life of the Nammuldi iron ore mine. With this funding, the project to increase production capacity in the Pilbara to 283 million tonnes a year is now fully approved.

2. USD 1.2 billion (Rio Tinto share USD 700 million) for Cape Lambert port and rail early works needed for the proposed capacity expansion to 353 million tonnes a year. The 353 million tonnes a year expansion is in final feasibility study, with a final investment decision expected later this year.

Rio Tinto expects capital intensity of expansion from 220 million tonnes a year to 353 million tonnes a year to be around mid USD 150s per tonne, on a 100 per cent basis (Rio Tinto share around mid-USD 130s per tonne).

Mr Sam Walsh Rio Tinto Iron Ore and Australia chief executive said "We believe we have the best quality iron ore expansion projects anywhere in the world. They are high return, low risk investments that are highly value adding for shareholders. Today we are announcing another significant milestone in our drive towards a more than 50 per cent increase in the size of iron ore operations in Western Australia. The program remains on track and we are bringing new iron ore production on stream at a time when demand from Asian markets is forecast to grow strongly, while industry supply growth remains constrained.”

Production capacity of 283 million tonne per year in the Pilbara will be reached in the second half of 2013. The Nammuldi expansion will deliver first ore in the third quarter of 2014, and there will be a transitional period until then in which ore will come from other mines to reach 283 million tonne per year.

The Nammuldi project will extend existing mining below the water table, increasing the mine's life by 14 years, at a production rate of approximately 16 million tonnes a year.

The Cape Lambert funding follows other early works investments already underway. Plans to increase capacity at the port have been enhanced by further plans to replace an ageing car dumper with a new dual car dumper, contributing an additional 20 Mt/a to take Cape Lambert capacity to 203 M/ta in 2015.

The works and plans remain subject to a number of joint venture and regulatory approvals, including environmental clearances, which are expected later this year.

Rio Tinto's schedule for expanding its integrated Pilbara operations is as follows
1. 225 million tonne per year - Current operating capacity
2. 230 million tonne per year by end of Q1 2012 - Dampier port incremental (in implementation)
3. 283 million tonne per year by end of H2 2013 - Cape Lambert 53 million tonne per year increment (in implementation)
4. 353 million tonne per year by end of H1 2015 - Cape Lambert 70 million tonne per year increment (in feasibility study)

Turkish steel exports to Singapore surge strongly in January

- 08 Feb 2012

According to the preliminary statistics provided by Turkey's Steel Exporters' Association, in January this year, Turkish steel exports to Singapore saw substantial growth amounting to 59,077 tonnes compared to just 1,332 tonnes recorded in January 2011.

The data show that Turkey's total steel exports to Singapore in the whole of 2011 amounted to 616,718 tonnes up 67.8% YoY ranking eighth among Turkey's largest steel export destinations.

In the first month of 2012, Turkey's steel rebar exports to Singapore which has a growing construction sector indicated a massive surge amounting to 45,240 tonnes compared to 183 tonnes recorded in the same month last year. Turkey's steel rebar exports to the country in 2011 amounted to 534,826 tonnes up 130% compared to 2010.

Singapore's Building and Construction Authority is providing financial support to enable the country's construction sector become highly integrated and technologically advanced as well as highly productive.

According to a report released by the authority, Singapore's construction demand increased by 16% YoY in 2011 to USD 32 billion up from USD 27.6 billion in 2010. The increase was backed by strong public sector construction demand arising from the ramp up in public housing projects.

For 2012, the total construction demand in Singapore is projected to be between USD 21 billion and USD 27 billion of which about 60% is expected to come from the public sector including construction demand for institutional buildings and civil engineering projects.

(Sourced from Steel Orbis)
Visit www.steelorbis.com for more

China steel output slips 1pct in mid Jan - CISA

- 08 Feb 2012

According to data issued by the China Iron and Steel Association, China produced 1.669 million tonnes of crude steel per day in the January 11st to 20th 2012 period down 1.3% compared with the previous 10 days.

Production normally drops in January as construction activity in northern China slow down for the winter. But output over the 10 day period was still 1.5% lower than the same period of 2011 and analysts have forecast that declining margins and weak demand could force mills to slash output further over the next month.

The following table shows changes in daily output since
October 2011.

(Sourced from Reuters)

Interpipe produced pipes from the first Dniprosteel heat

- 08 Feb 2012

Interpipe rolled the first lot of seamless pipes, using the billets, produced at the new Dniprosteel electric steel-smelting complex. The first pipe was rolled at Interpipe NTRP plant, using a steel billet, produced in the course of the first heat.

The first pipe passed the entire set of tests, which confirmed the high quality of the billet's steel. Production of the first pipe means that Interpipe moves to the vertically integrated company structure: from scrap procurement, through steel smelting, and up to the production of steel pipes and railway wheels. The list of consumers of Dniprosteel pipe billets will include two Company's plants namely Interpipe NTRP and Interpipe NIKO TUBE. At present both enterprises are ready for integration with the Dniprosteel electric steel smelting complex.

Mr Alexander Kirichko GM of Interpipe said that "One of the major reasons for Dniprosteel construction is to ensure the provision of Company' plants with our own billets for seamless pipes and railway wheels. Interpipe currently purchases 70% of steel billets for seamless pipes from external suppliers. When Dniprosteel reaches its full capacity in 2014, Interpipe's self sufficiency in billets for production of seamless pipes will state for 90%. Thus, the vertical integration of the company will be completed."

The rolling of the first pipe was carried out by one of the Interpipe NTRP shops, producing oil and gas pipes. Twelve billets with the weight of 100 tons were cut into ingots for production of casings (pipes used for oil and gas extraction). The rolling process resulted in 94 pipes with the length of 12 meters each.

Mr Andrei Korotkov chairman of Interpipe NTRP board said that "Production of seamless pipes and railway wheels out of the continuously cast billets will allow Interpipe’s mastering and certification of new types of products, such as, for instance, corrosion-resistant pipes according to 5CT American standard and many other products. In addition to that we expect a considerable reduction in the metal discharge coefficient. Only for pipes we can save approximately 5000 tonnes of metal a year."

Aperam announces FY 2011 segment results

- 08 Feb 2012

Sales in the fourth quarter of 2011 decreased by 6% to USD 1,436 million compared to USD 1,520 million in the third quarter of 2011. Shipments in the fourth quarter of 2011 were flat at 429,000 tonnes compared to 429 thousand tonnes in the third quarter of 2011.

EBITDA was USD 53 million in the fourth quarter of 2011 compared to EBITDA in the third quarter of 2011 of USD 62 million. The decrease in EBITDA quarter versus quarter was primarily driven by lower activity resulting from the seasonal slowdown in South America and a decrease in base and transaction prices. These factors impacting EBITDA were partially offset by the continuing progress of the "Leadership Journey", which has contributed USD 176 million to EBITDA since the beginning of the year. Aperam had an operating loss in the fourth quarter of USD 29 million compared to an operating loss of USD 20 million in the previous quarter.

Net interest expense and other financing costs in the fourth quarter of 2011 were USD 27 million, including financing costs of USD 16 million. Unrealized foreign exchange and derivative gains were USD 2 million in the fourth quarter of 2011. The Company recorded a net loss of USD 46 million, inclusive of an income tax benefit of USD 8 million in the fourth quarter of 2011. Cash flows from operations in the fourth quarter were a positive USD 227 million, with a working capital decrease of USD 253 million. CAPEX in the fourth quarter was USD 51 million.

Stainless & Electrical Steel
The Stainless & Electrical Steel segment had sales of USD 1,107 million in the fourth quarter of 2011. This represents a decrease of 3% compared to sales of USD 1,143 million in the third quarter of 2011. Shipments during the fourth quarter were 396,000 tonnes, including 238,000 tonnes in Europe and 158,000 tonnes in South America. This is an increase of 6 thousand tonnes compared to the previous quarter's shipments of 390 thousand tonnes (222,000 tonnes in Europe and 168 thousand tonnes in South America). Volumes in South America decreased by 6% in the quarter due to seasonality. Despite this decrease in South America, overall volumes for the segment increased slightly as a result of the 7% increase in volumes in Europe due to the reduced impact of seasonality in the quarter compared to the previous quarter.

The segment had EBITDA of USD 26 million in the fourth quarter of 2011 compared to USD 23 million in the third quarter of 2011. EBITDA from South America decreased from USD 26 million in the third quarter of 2011 to USD 23 million in the fourth quarter of 2011. EBITDA from Europe increased from negative USD 3 million in the third quarter of 2011 to USD 3 million in the fourth quarter of 2011. Average steel selling prices for the Stainless & Electrical Steel segment were lower for the quarter.

The Stainless & Electrical Steel segment had an operating loss of USD 37 million during the fourth quarter compared to an operating loss of USD 45 million in the third quarter of 2011. Depreciation and amortization expense was USD 63 million in the fourth quarter of 2011.

Services & Solutions
The Services & Solutions segment had a 13% decrease in sales during the period, from USD 630 million in the third quarter of 2011 to USD 546 million in the fourth quarter of 2011. In the fourth quarter of 2011, shipments were 149 thousand tonnes compared to 164 thousand tonnes in the previous quarter. In addition to lower shipments, the Services & Solutions segment also had lower average selling prices for the period.

The segment had negative EBITDA in the fourth quarter of USD 6 million compared to negative EBITDA of USD 1 million in the third quarter of 2011. EBITDA for the quarter was again impacted by the seasonality at the end of the year and lower average selling prices. In addition, the segment was also impacted by a negative stock effect resulting primarily from the decline in nickel prices that occurred during the quarter.

The Services & Solutions segment had an operating loss of USD 17 million in the fourth quarter of 2011 compared to an operating loss of USD 8 million in the third quarter of 2011.

Alloys & Specialties
The Alloys & Specialties segment had sales in the fourth quarter of USD 153 million, representing a decrease of 7% compared to USD 164 million in the third quarter of 2011. Shipments were comparable at 8 thousand tonnes in the third quarter to 8 thousand tonnes in the fourth quarter.

The Alloys & Specialties segment achieved EBITDA of USD 12 million in the fourth quarter of 2011 compared to USD 11 million in the third quarter of 2011. Average selling prices in the quarter were down as a result of lower nickel prices.

The Alloys & Specialties segment had operating income of USD 10 million in the fourth quarter of 2011 compared to operating income of USD 10 million in the third quarter of 2011.

Copper eases as China buyers out for the count

- 08 Feb 2012

Reuters reported that London copper slipped on sluggish post holiday purchases from top consumer China but prices were supported by hopes that Greece's bailout deal would succeed and help the euro zone avoid an economic downturn.

Three month copper on the London Metal Exchange fell 0.48% to USD 8,459 per tonne by 0702 GMT clawing back some losses from the previous session when it slipped by almost 1%. Copper hit a one week high of USD 8,598.50 and rose for the fourth consecutive week last week. The most traded April copper contract on the Shanghai Futures Exchange edged down 0.83% to CNY 60,030 per tonne.

US based analyst Ed Meir of INTL-FC Stone said that "It's all Greek related right now, there's nothing fundamentally to move the markets in terms of Chinese demand. Markets will discount some sort of agreement and the firmer tone will probably carry on until we have the next big shoe drop the Chinese trade data for January could be significant."

Greek leaders face crunch talks to agree on unpopular reforms to secure EUR 130 billion bailout and avert a chaotic debt default which could threaten its future in the euro zone.

The leaders are caught between their increasingly frustrated partners in the European Union for failing to pass the reforms quickly and workers who went on strike on Tuesday to protest against the austerity measures.

The euro was edging lower against the dollar ahead of the talks, adding headwinds to metals because a stronger greenback raises the cost of commodities for holders of other currencies.

On the demand side, Chinese trade data is due later this week, with markets keeping a close eye on copper imports which hit a record high in December when arbitrage and financing opportunities burnished the metal's appeal.

China is the world's largest copper consumer, and monthly import figures have been climbing since June 2011. But imports are expected to be weaker in January in part due to Lunar New Year holidays and as slower manufacturing weakened demand. How much weaker will be a key point watched by the market, given signs of sluggish post holiday consumption.

(Sourced from Reuters)

Iranian steel market trend in week 05 2012 - Flat products

- 08 Feb 2012

Flat products market was volatile during last week in Iran. HRC 2 mm was around USD 976 per tonne and then dropped to USD 879 per tonne and increase again to USD 905 per tonne at the end of the week.

Other sizes of HRC production of domestic steel mills were dropping too. A reason for the declines in prices can be drops in exchange rate which made import parcels cheaper and the other reason would be cheap purchase of last months in IME which their delivery time has arrived.

Traders worried about more drops in prices suggested some discounts, so it made market more downward. If exchange rate decreases, HRP market would be downward as demand level is limited and last month import level was high. Global prices are downward too.

CRC market was downward by USD 18 per tonne due to sluggish market trend. If Mobarake Steel increase supply level in IME more, the price will continue dropping. But inventory levels are low and supply level increase till the year end is unlikely.

HDG market was downward too and declined around USD 27 per tonne but supply level is yet limited, though market participants expect some improvement in the market.

(Sourced from www.irsteel.com)

Chinese long product price index down by 12 points on February 07

- 08 Feb 2012

The Chinese Long Product Price Index CLPPI went down by 12 points on February 7th 2012, whereas the Chinese Flat Products Index CFPPI remains flatter. The overall price index CHISPI down by 6 points.

CLPPI - Chinese Long Product Price Index
CFPPI - Chinese Flat Product Price Index
CHISPI - Chinese Steel Price Index

Long Products

PI- Product Index

Flat Products

PI- Product Index

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

To know exact prevailing steel prices in China on daily basis, subscribe to services of SteelHome by sending a mail to admin@steelprices-china.com

(Sourced from www. steelprices-china.com)

Metinvest to invest USD 8 billion into its Mariupol based steel works by 2020

- 08 Feb 2012

Metinvest, an international vertically integrated steel and mining group of companies, within the frames of its long-term development strategy implementation has declared it will be investing on average USD 1 billion every year through 2020 in development of its Azovstal and Iliych iron and steel works.

The investments will allow increasing joint annual steel output at these steel plants by 35% to 16 million tonnes and reduce the amount of specific emissions 5 times down to 7 kilogram per tonne of crude steel.

Metinvest intends to invest around USD 8 billion in excess till 2020 into the reconstruction and modernization of its two integrated steel works in Mariupol Azovstal and Ilyich Iron and Steel Works of Mariupol (Ilyich Steel) and increase the crude steel output by 35% to16 million tonnes. The adopted integrated approach to modernizing the production facilities is based on improving production efficiency with simultaneous reduction of negative effect on environment. The strategy envisages reduction of gross emissions by 3.5 times and specific emissions per tonne of steel by 5 times.

Mr Igor Syry CEO of Metinvest said that "We are determined to provide substantial reduction of negative exposure on environment while modernizing our facilities to improve production efficiency. This is how we are convinced any modernization shall be realized. Till 2020 we will have invested around USD 8 billion into such programs at these two plants alone, that means average annual expenditures of about USD 1 billion. The measures to be realized in 2012 will have reduced emissions by 10%."

Nickel contango deepens on Russian exports - JPMorgan

- 08 Feb 2012

JPMorgan Chase & Co said that nickel is moving more deeply into contango as a decline in Russian exports suggests metal has been retained as inventory, adding to a global glut.

Contango describes a market in which later dated contracts trade at higher prices than those with nearer dates. Immediate delivery nickel today reached a discount of USD 91 a tonne to the three month contract, heading for the widest closing gap since December 2009, on the London Metal Exchange.

Russian nickel exports dropped 19% to 195,500 tonnes in 2011 even after December's 91% jump. OAO GMK Norilsk Nickel said on January 30th 2012 that output of nickel at its Russian units climbed 0.7% to 237,200 tonnes in 2011.

Mr Michael J Jansen, a London based JPMorgan analyst, said that "The weaker export number reflects a buildup in domestic inventory of refined metal that will continue to dribble out. There is a lot of nickel in the global economy which is yet to be priced into flat price and spreads. However, the market is suspicious of the pending impact, evident in the steadily widening contango."

Nickel for three month delivery rose 1.4% to USD 21,600 a tonne by 5:15 PM on the LME. The metal, used mostly to protect stainless steel from corrosion, is up 15% in 2012 after dropping 24% in 2011.

The nickel market will be in surplus this year by 54,000 tonnes, JPMorgan forecasts. Inventories monitored by the LME climbed 9% to 94,518 tonnes since November 1st 2011. Norilsk expects total output of the metal to gain as much as 3.4% to 305,000 tonnes in 2012 after a 0.8% drop in 2011.

(Sourced from www.bloomberg.net)

Japan flat aluminum shipment maintains YoY minus in Dec

- 08 Feb 2012

Japan Aluminum Association has announced that Japanese monthly output of rolled aluminum products including flat and extruded products decreased by 6% to 159,845 tonnes in December from a year earlier while the shipment decreased by 6.1% to 157,497 tonnes.

Both of the production and the shipment represented YoY minus for 7 straight months. By items both of the production and the shipment showed YoY minus for 7 months in a row for flat aluminum products.

The export dropped by 23.8% to 13,668 tonnes, especially decreasing to Southeast Asia due to Thai flood. On the contrary, production of aluminum extruded products represented YoY plus for 3 months in a row while the shipment showed YoY plus for 5 straight months. The shipment improved by 3.4% for automobile industry and increased by 13.5% for constructions both of which are the main application fields.

As for aluminum foil, the production represented YoY minus for 4 straight months. Inventory adjustment continued among the users such as capacitor and food sectors.

(Sourced from www.japanmetalbulletin.com)

Latest information on projects in India, SEA and Gulf region

- 08 Feb 2012

SteelGuru has added yet another value added service for its readers to help them remain updated with various CAPEX projects in the Indian sub continent and other emerging economies.

Under this service, although all the projects are covered, major focus remains on energy, infrastructure and manufacturing segments.

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The database is updated with new information on various projects by our researchers 6 days a week and through out the year. The information is collected using various means including desk research, internet and filed visits.

The subscriber is allowed to access complete database, which has more than 18817 projects information. The user can see updates on everyday basis in projects database. The interface has many easy to use search options, whereas, locating relevant projects information on different parameters like industry, status and project cost etc is easy. Projects information is categorized as per stage ie under planning, under execution, on hold, recently commissioned etc.

The subscriber can also view the contact details of promoter related to project and wherever possible for architect, consultant and contractors etc.

We claim above 80% accuracy of information that we provide. Contact details are subject to change and in few cases may remain unchanged for some time.

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Find new clients through SteelGuru platform

- 08 Feb 2012

With the ever increasing use of internet for dissemination of information, every company’s website is becoming one of most important medium, with almost zero cost, to make announcements, solicit new clients and promote products.

Company websites, which are virtual show cases, are generally designed with great zeal and efforts but do not serve the full purpose as they lack viewers. In fact they are visited mostly by only those who are specifically referred thus limiting the reach severely.

We would like to inform you of a unique opportunity to reach global steel industry and allied sectors through our platform www.steelguru.com, which is the most popular and visited English based steel portal globally with average daily page hits of 150,000+ per day. You may like to check our ranking using www.alexa.com, where it can be compared with other web sites.

We can put your advert on www.steelguru.com through an image, hyper linked to your website. This could increase the traffic to your web site and help you leverage it to your advantage.

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Vale iron ore ships face elevated cancellation risk - HSBC

- 08 Feb 2012

HSBC Shipping Services Ltd said that there’s an elevated risk that Vale SA, the Brazilian mining company amassing a fleet of 35 of the world’s largest iron ore carriers, may cancel some of the contracts.

The vessels, each able to hold as much as 400,000 metric tonnes of ore, are excluded from China by port entry requirements for very large vessels that were tightened last week. The rules apply to dry bulk vessels larger than 350,000 deadweight tonnes, the China Shipowners Association said. Vale, the world’s largest ore producer, says it’s operating six vessels above that size, of which it owns four and charters two.

Vale remained committed to the construction of the remaining 29 ships, the Rio de Janeiro based company said last week, as part of plans to spend USD 8.1 billion on new ships and take greater control over freight costs from Brazil to China, its fastest growing market in Asia.

HSBC said in the report that “The shipbuilding program might look like an expensive mistake, but it is potentially even worse than that if they are banned from entering China. Six have already entered service and some of the remainder must now be at elevated risk of cancellation.”

None of the existing Vale owned ore carriers have been permitted to call at Chinese ports. The Berge Everest, owned by BW Group Ltd. and under a long-term contract to Vale, called at Dalian in December. Chinese shipowners opposed the vessels’ introduction on concern it would worsen a capacity glut and plunging rates. China is the biggest global user of iron ore, a steelmaking ingredient.

(Sourced from Bloomberg)

ArcelorMittal not counting on Indian plans for next few years - Mr Mittal

- 08 Feb 2012

Unable to get regulatory approvals for its proposed USD 30 billion investment, world's largest steel maker ArcelorMittal has for the time being put on hold its India business plans.

Mr LN Mittal said that "It is very difficult to say any thing. When will start the construction, when we will really make the progress. We are not even counting them in our business plans for the next few years.”

Noting that ArcelorMittal is still in the process of securing various regulatory approvals, Mr Mittal further said that his company is waiting for a clear picture to emerge on various government policy initiatives like new mining bill.

He said that "New bills are coming in Parliament. There is a new policy for coal allocation. So, we are really watching the various developments and rules and regulations (that are) coming in. Then only we will have the visibility about the projects in India.”

The world's largest steelmaker has plans to build 2 mega steel plants of 12 million tonnes each in Jharkhand and Odisha and one 6 million tonnne plant in Karnataka at a total estimated investment of INR 1,30,000 crore (USD 30 billion).

(Sourced from ET)

Rio Tinto announces board and committee changes

- 08 Feb 2012

Rio Tinto announced that Mr John Varley has been appointed senior independent director of the boards of Rio Tinto plc and Rio Tinto Limited.

He will succeed Mr Andrew Gould who, as previously announced, will retire from the boards at the conclusion of the 2012 annual general meetings on 10 May.

Mr John Varley, who was appointed to the boards on 1 September 2011, will continue in his role as chairman of the remuneration committee.

Mr Jan du Plessis, chairman of the boards of Rio Tinto, becomes a member of the remuneration committee with immediate effect.