December, 03 2005
Jharkhand government to challenge tribunal order in favor of IISCO
Jharkhand government has decided to move the Jharkhand High Court against Central Mining Tribunals direction to renew the lease on Chiria mines in favor of IISCO. The government has decided to challenge the verdict passed on November 9 quashing the state governments order to cancel the IISCO lease on Ajitaburu, Jhilingburu and Sukri iron ore blocks of Chiria mines in West Singhbhum.
The state counsel Mr SK Verma, said: The state government will be filing a petition within the next few days in the Jharkhand High Court challenging the order of the tribunal. The government shall question some points that are inaccurate but were raised by the tribunal in its order.
Jharkhand intends to allot these mines to private players, who had recently signed the MoUs, so that adequate iron ore reserves are assured to them for mining purposes. In fact it desperately needs these three mining blocks.
Steel minister informs 7 to23% reductions in steel prices in2005
"As per information available in the Mumbai market, prices of steel products in general decreased from January to November 2005 by about 7 to 23% depending on the products," Steel Minister Mr Ram Vilas Paswan informed Rajya Sabha.
Since January 2005, the prices of some of the raw materials used in the production of steel have increased while others have decreased.
KIOCL looking at alternate iron ore sources for pelletization
Kudremukh Iron Ore Co Ltd KIOCL is reported to exploring options to source iron ore from distant mines in north Karnataka or Orissa to produce pellets.
KIOCL has applied to the Karnataka government for a license to mine the iron ore reserves in the Ramanadurga area that falls between the steel towns of Hospet and Bellary in north Karnataka, it is yet to get clearance because other bidders for the mines have dragged the matter to the high court.
It has also signed a MoU with SAIL to source the iron ore from its captive mines at Barsna, Katta and Taldi in Orissa. The company has tied up with the NMDC for the supply of 200,000 tonnes of iron ore with rich ferric content from its mines at Donnamalai in Bellary district.
It is reported that KIOCL needs roughly 4 to 5 million tonnes of iron ore annually to process and produce about 3.6 million tonnes of pellets and 2.3 million tonnes of iron ore concentrate for exports to Japan, China and Taiwan. About 95% of the company's two main products are shipped overseas from Mangalore port where it has an exclusive berth
Jharkhand High Court grants 15 days to HEC for revival plan
It is reported that against Heavy Engineering Corporation HECs request for granting more time for putting together a revival plan, Jharkhand High Court has given two weeks. If nothing dramatic happens in the next two weeks, the high court, too, will clear the decks for liquidating the industrial unit.
The state government appeared all but ready to hand over HEC and the campus to private players like Usha Martin and Jindal Steel, both of which appear to have expressed their interest to buy the land in HEC township which is said to be approximately 3,500 acres valued at Rs 1,750 crore.
HEC owes Rs 650 crore to the electricity board for power dues and Rs 855 crore to the banks. Besides, it owes the state government Rs 20 crore by way of sales tax and Rs 74 crore to the Central Industrial Security Force. HEC had demanded a cash assistance of Rs 2,200 crore to pull itself out of the woods. The draft sought to invest Rs 100 crore for modernization and replacement of its obsolete equipment and Rs 160 crore to meet its employee obligations. The rest would have to go to meet sundry debts. While the newly set up Bureau of Public Sector Enterprises, New Delhi, has cleared the draft, the committee of secretaries is yet to take a decision. Once the committee clears it, the draft then will have to be sent to the union cabinet for approval.
Higher classification for iron ore may hit Railway earnings
With effect from Thursday, iron ore booked to ports has been put on a higher class of 180 from 160. Normally, the zonal railways carrying iron ore to the ports should feel happy about it as higher classification means higher freight earnings for them. However, they fear that they may lose traffic as a result of change in classification.
Many railway stations act as the gateways to port. Some iron ore exporters, so far booking their consignments right up to the ports, may now do the booking up to the gateway stations to avoid higher freight.
Not all the iron ore that is transported to ports is meant for exports. Some may be consumed locally, that is by sponge iron units located close to the ports. These units will be reluctant to have their raw material transported by rail any more as they will be now required to pay higher railway freight following the change in classification. To that extent, the Railways might lose the traffic.
The same is true about the coastal shipment of ore. An iron ore-consuming unit located on the west coast and receiving the mineral by way of coastal shipment through an east coast port too will no longer be interested in following the same route. Instead, they would rather prefer to have the mineral transported from the mines to the plant all the way by rail, bypassing the port and the coastal route.
Orissa mining policy to be announced after Centre decides
Orissa governments Finance Minister Mr Prafulla Chandra Ghadei told the Assembly that the mining policy of the State would be announced after finalization of report by the committee constituted by the Centre in this regard. The Minister said the Committee constituted by Chief Minister Naveen Patnaik to formulate the state mining policy had finalized the draft. But announcement of the policy was postponed due to the constitution of a similar committee by the Centre.
He said that the committee constituted by the State Government studied policies of several states including Jharkhand, Chhattisgarh, Madhya Pradesh and Rajasthan and met five times before finalization of the draft.
Siemens to aim for bigger share of Indian steel industry
India has emerged as a key market for Siemens AG, the German industrial manufacturing company. President and CEO Mr Klaus Kleinfeld said that with 13 manufacturing facilities spread across the country, Siemens India was positioned to play a larger role in the parents strategy for Asia.
Dr Klaus Kleinfeld has identified steel as a sector where the company could increase its presence. Dr Kleinfeld said, "Given the massive expansion plans that Indian steel companies have undertaken recently and the number of MoUs signed for setting up new steel plants is clearly an opportunity that we are now actively pursuing to increase our market share in the steel sector."
Siemens also wants to further consolidate its business with the government for huge infrastructure projects, said Dr Kleinfeld after his meeting with senior government officials in New Delhi.
Siemens is also going to hire a large chunk of skilled talent from India, primarily in the engineering and natural life sciences, space, said Dr Kleinfeld.
Steel Ministry against closure of joint plant committee
The expenditure reforms commission in its 6th report had recommended the winding up of the JPC.
However, in view of certain vital functions such as collection and analysis of data related to the steel sector, being performed by the JPC, the government is not contemplating its closure, steel minister Mr Paswan informed
Adani Group joins Bay Bridge Enterprise for ship breaking
Virginia based Bay Bridge Enterprises has proposed establishing a ship breaking operation at McLean Point in the northeast corner of port property in Yaquina Bay with Adanai Group
The Bay Bridge facility in Virginia is made up of one main 1,200 feet long boat slip, and a drag up slip with a backup area. It can demolish three to five vessels at the same time, depending on their size. The shipyard is located on the Elizabeth River, a heavily industrialized tributary to the Chesapeake River
Adani is involved not only in port operations and scrap steel, but in energy, grain, wheat and sugar, coke products, textiles, hydrocarbons and petrochemicals, among other industries with HQ in Ahmedabad and overseas offices in the United Arab Emirates, Singapore, Bangladesh, Mauritius, Indonesia and Vietnam.
SEBI slaps penalty on Ispat Industries
It is reported that Securities and Exchange Board of India has imposed a penalty of Rs. 1 lakh on Ispat Industries for violating the Listing Agreements and Regulations. It had earlier alleged that Ispat communicated some price sensitive information to a private TV channel before furnishing the same with the stock exchanges.
TopKamdhenu Ispat plans IPO for Rs 32 crores
Kamdhenu Ispat Ltd plans to raise Rs 32 crore through Initial Public Offer to finance its expansion plans and has approached SEBI for its approval.
The company plans to introduce many more production units based on the latest technologies to cater to the growing HSD and TMT bars market, a company release said.
OSL likely to bag Gopalpur port
A consortium led by the Orissa Stevedores Limited OSL is likely to bag the project for development of minor port in Gopalpur into a major port as it has become the sole contender for the job after the completion of technical bid for the project. Apart from OSL, the consortium has Sara International and Noble Group as partners.
The Orissa government had invited bids for development of seasonal port at Gopalpur into an all weather on build, own, operate, share and transfer (BOOST) basis. The present scope of up gradation of the port includes dredging the channel to allow the ships come to the harbor round the year
Initially five consortiums had shown interest in the project including Integrax Barhad in association with Muhibhan Engineering (M) Barhad of Malaysia, OSL led consortium with Sara International and Noble group as partners, BHP Minerals, L&T in association with Kakinada Seaports Ltd, and Infrastructure Leasing and Finance Ltd in association with Hili Company Ltd. However, the first two consortiums only participated in the technical bid. Later, the Malaysian company withdrew leaving only OSL in the race.
CISA executive slams DRCs steel surplus prediction
Mr Qi Xiangdong, the deputy general secretary of China's Iron and Steel Association CISA criticized Friday a government report that predicts an enormous oversupply of steel in 2006. He said he does not think China's steel supply will exceed demand by more than 100 million tons next year as outlined in a report recently released by the Development Research Center of the State Council. He called the results of the center's investigation unprofessional and incredible.
The DRC's report forecasts China's demand at 337 million tons of steel next year, 31 million tons more than 2005. In addition, it says the country's steel factories are expected to produce 453 million tons of steel, up 48% YOY exceeding demand by 116 million tons.
Mr Qi said due to the sluggish steel market in China in the second half of this year, steel makers in China had cut their production to limit losses. He predicts that China's total crude steel production will reach 345 million tons in 2005 and touch 385 million tons in 2006, rising only 12% or 40 million tons more. He also said China's demand should hit 428.5 million tons of crude steel in 2006 with the acceleration of China's fixed asset investment. Therefore, China's steel surplus should be smaller than the center predicted.
Mittal Steel ups stake in SA unit to 52%
Mittal Steel has raised its stake in its South African unit, Mittal Steel SA, to 52% from 50% by buying 9 million shares worth R460 million on November 24. Ms Nicola Davidson, head of Mittal Steel's corporate communications, told press that the purchase was not part of a planned series, but a one-off aimed at consolidating the parent firm's hold on the South African unit.
Rumors had plagued the stock earlier this year that Mittal Steel planned to delist from the Johannesburg market. Mittal Steel SAs CEO Mr Davinder Chugh said the parent company would buy out minority shareholders in the South African unit only if it increased its stake to over 60% from just above 50% current
Supreme Court upholds tax on coal exports
West Virginia's Supreme Court on Friday affirmed the state's right to tax coal exports, rejecting coal companies' arguments that its severance tax is actually a sales tax that violates federal protections of interstate commerce. If the court had struck down the tax, the state said it would have been forced to refund an estimated $500 million in tax revenue and interest to the 11 coal companies that challenged it.
Out of the 11 coal companies that originally filed the lawsuit in 2003, at least seven have since changed hands. The companies now involved in the lawsuit are Alpha Natural Resources Inc, Arch Coal Inc, Consol Energy Inc, Foundation Coal Holdings Inc, International Coal Group Inc, Massey Energy Co, Peabody Holding Co Inc. and US Steel Mining Co.
West Virginia companies export coal to 25 countries, most of it metallurgical coal which is used in making steel. Exports make up about 10% of West Virginia's total coal sales
Arcelor board to decide management organization & strategy
Arcelor SA will hold a board meeting on December 15 to discuss the organization of the company's management, a spokesman said.
The spokesman said the board will discuss 'the strategic direction of the group, the organization of the board of directors and the management of the group', among other subjects.
The report also said that Arcelor is planning to restructure its operating organization, by creating separate divisions based on regional presence, instead of the current division by activities.
At the same time, it will reduce the management committee to three or four members only, down from 8 currently, 'in order to be more reactive, less focused on operational activities and more on growth,' according to a company source, quoted by a local daily
Special bonus of 1,350 euros for ThyssenKrupp Steel AG employees
The almost 20,000 employees of ThyssenKrupp Steel AG are to share in the record earnings of the largest single company in the ThyssenKrupp Group. Blue and white collar workers will receive a special bonus of 1,350 euros with their December salary and apprentices 338 euros. The bonus system is made up of two components: The earnings-related component is based on the earnings of ThyssenKrupp Steel AG and the ROCE
The full bonus is payable to full-time employees who worked uninterruptedly for ThyssenKrupp Steel AG during the reference period and who are in the employment of the company at the time of payout. Part-time employees will receive a share of the bonus based on the ratio of their part-time working hours to the collectively agreed working hours.
"These are the first fruits of the earnings and performance-related bonus system we concluded with the works council in September 2004," says Mr Dieter Kroll, ThyssenKrupp Steel Human Resources
Overcapacity in SS sector - MEPS
SS Oversupply has restricted SS mill profitability this year, especially in Europe and Asia and some producers fell into the red in the third quarter. Production cuts by most major producers have contributed to the stock run-down. Mills have announced output curbs amounting to more than 1.5 million tonnes in the second half of this year, although it is not clear how much of this represents a real reduction in supply to the market.
EU and US producers will be looking for opportunities to raise basis prices as the re-stocking phase of the cycle begins. However, sharply escalating production in China could derail this process. Chinese crude stainless output rose by more than 50% in the first half of 2005, and is forecast to exceed 3.7 million tonnes by December, a YOY increase of over 30%.
Growing Asian production means companies which traditionally export into that region are finding it more difficult to do so. Finlands Outokumpu has shifted some of its supply away from Asia into other markets. South Africas Columbus Stainless, part of the Acerinox group, has resorted to production cuts rather than sell hot coil into Asia at the very low prices currently ruling. Poscos stainless production so far this year is down by almost 5%.
Expanding Chinese supply is forcing these and other producers to curb their output. Within China itself, there have been reports of some cold rolled strip producers switching away from stainless to roll carbon steel strip instead.
The picture could deteriorate further. According to a recent report by Outokumpu, China will account for around 70% of the global increase in stainless melting capacity between 2004 and 2009. If all of these additional furnaces are built, and this is not necessarily the case, they will pose a long term threat to both price levels and stability of the market in general.
Lianyuan starts commercial production of new galvanizing line
It is reported that Lianyuan Iron & Steel has started commercial production in their 240,000 tonnes per year new galvanizing line on November 28.
Lianyuan produce cold rolled sheets and coils ranging from 0.25mm & up in maximum widths of 1700mm wide.
UBS says US Steel takeover unlikely
US Steel, with subsidies in Slovakia and Serbia, is the world's seventh-largest steel producer in 2004 with an enterprise value of $8.3 billion, making any merger unlikely, according to UBS analyst Timna Tanners. "We do not envision the larger companies are interested or financially comfortable with making this size acquisition currently," Tanners wrote in a research note.
U.S. Steel, which acquired the assets of National Steel out of bankruptcy in 2003, has an annual production capacity of more than 24.2 million tons globally, with about 18.4 million in the U.S.
SUEK invests in advanced mechanized longwall equipment
The Siberian Coal-and-Energy Company (SUEK) has purchased an advanced mechanized longwall system with intelligent production control, manufactured by British equipment maker Joy Mining Machinery. SUEK bought the equipment for its Kirov Mine in the Kemerovo region.
Such innovative equipment has not been used in Russia yet, and there are only four similar systems operating in the world. In future, such equipment will allow Russian coal miners to fully automate their longwall operations, for the first time in the history of Russias coal-mining industry. Investing in new equipment, the company seeks to improve security at its coal mines and raise labor productivity.
The new equipment, worth about RUR 1 billion, will be installed at the second face of the Kirov mine. Simultaneous operation of two faces equipped with this state-of-the-art equipment will enable the mine to bring its output to 4 million tons of coal next year, said SUEK spokesman Mr Ivan Sleptsov. Over the next two years, we plan to raise production to between 2 million and 3 million tons from one face, meeting international standards of labor productivity, he said. In the long run, such equipment will allow Russian coal mining companies to fully automate their longwall operations, for the first time in the history of Russias coal-mining industry. All operations will be controlled remotely, and there will be no people in the mining zone.
SUEK is Russias largest coal mining company and the only Russian company included in the world's top ten producers of coal. SUEK has branches and subsidiaries in Krasnoyarsk, the Primorsky and Khabarovsk territories, Irkutsk, the Chita and Kemerovo regions, and the Republics of Buryatia and Khakassia. The group has over 30 mines and open pits, more than 20 service companies and a research center. It employs about 45,000 people. SUEK sold 75.6 million tons of coal last year, reporting revenue of RUR 32.7 billion and a net profit of RUR 4.4 billion.
Leman interested in iron ore works in Nigeria
The Ukraine-Nigeria investment forum held in Kyiv last month under the aegis of the Nigerian Investment Promotion Commission, has started yielding positive results as seven Ukrainian companies are to invest in various sectors of the economy.
It is reported that Leman Ukraine representing the interests of leading Ukrainian iron and steel producers, has filed the application for the participation in international tender for the purchase of the majority shares of iron and steel works in Delta and Plateau States.
Tax exemption for Pomihoa steel removed
Vietnams Ministry of Trade has acknowledged shortcomings in approving tax exemption for Tam Diep Steel Laminating Plant (Pomihoa Steel) and would decide whether to collect tax arrears. The ministry has also asked the Prime Minister to reject proposals on tax incentives for projects with similar conditions to Pomihoa.
Several months ago, MoTs decision on tax exemption for Pomihoa raised strong opposition from steel manufacturers. Projects carried out in Ninh Binh Province, a locality with difficult conditions, are listed B projects, while tax exemption is only applied to C projects, those carried out under very difficult conditions. Steel manufacturers accused Pomihoa of taking advantage of the exemption to reduce prices by VND150, 000 per tonne, causing unhealthy market competition.
Until now, Pomihoa has been exempted up to VND11bil in tax for 39,000 tonnes of ingot steel imports; however, the ministry may release a document informing that Pomihoa will have to incur tax on imported ingot steel as stipulated by current regulations.
Large no of Ukrainian coal mines will be sold next year
Ukrainian President Mr Viktor Yushchenko said that a large number of coal mines will be sold as part of reform of the coal industry.
"As of January 1, we want to tackle reform of the coal industry and to offer a large number of mines for sale, and we want to see this sector go private," Yushchenko said at a business conference in Kiev.
Bosung to acquire stake in Hae Won Steel
South Korean Bosung Construction Co Ltd has planned to acquire a 32.46% stake, in Hae Won Steel Tech Co Ltd, a steel manufacturer and wholesaler for 4.815 billion won ($4.724 mil), in a privately negotiated transaction.
Hae Won Steel Tech Co Ltd operates steel works with blast furnaces & rolling mills and steel service centers
Bosung Construction Co Ltd is a South Korean construction giant
Ovako to invest 30 million to modernize wire rod division
Swedish carbon and alloy steel long products producer, Ovako will invest 30 million in over the next two years to modernize its wire division. Ovako will rebuild Alblasserdam wire rod mill in the Netherlands which will include the modernizing of the annealing furnaces at the site.
They will also ass a continuous casting line in Koverhar, Finland. The project will expand the wire rod production range and will improve its annealing capacity. Ovako's special engineering steel capacity is 525,000 tonnes per year
Pike River to double coal transportation to Greymouth
A consent application has been granted to the Pike River Coal Company, which will allow it to double the tonnage of coal it transports by road to Port Greymouth in New Zealand. The company will now be allowed to take 1.3 million tons of coal a year from the mine to the port. It is expected that will involve 133 return trips a day by the coal trucks.
Public submissions were overwhelmingly against the application and conditions have been imposed relating to limiting night-time noise, preventing coal dust being lost en route and the upgrading of a railway crossing.
Another coal mine blast in Hebei kills 5
A coal mine blast has killed five miners and left one missing in north China's Hebei Province, local authorities said. The gas explosion occurred at 7:30 p.m. Wednesday at Xipo Coal Mine in Weixian County of Zhangjiakou City, according to the provincial coal mine safety bureau.
Six miners were doing maintenance down the shaft when the blast happened, and rescuers rushed to the scene immediately after the accident, the bureau said.
The coal mine, with an annual capacity of 60,000 tons, has not got a safety license for operation, the bureau added.
Mr Oleg Kiselyev resigns from NLMK board
Mr Oleg Kiselyev, a non executive director on the Novolipetsk board since 2004, is reported to have resigned as he was charged by the Moscow Department of the Russian Ministry of the Internal Affairs in a criminal case relating to a conflict involving certain shares in OJSC Mikhailovsky GOK. Mr Kiselyev has also resigned his position as president and a director of Moscow investment bank Renaissance Capital.
"This case has no relation to Novolipetsk or to Mr Kiselyev's activities as a member of our board," a NLMK document adds.
Grupo Imsa seeks separate listing for non-steel units
Mexican steel and industrial conglomerate Grupo Imsa plans to split its aluminium and plastic products subsidiaries, collectively called Imsatec, from its steel unit and the company will seek separate listing on the Mexico City bourse for its new holding company dubbed G2, which will include all units linked to Imsatec. The separation of G2 from Grupo Imsa is expected to be complete by early-February
Companies included in steel unit Imsa Acero will remain under Grupo Imsa.
With the restructuring, Grupo Imsa expects better results from each of the companies.
Falconbridge Falcondo union says talks could stall
A union leader at Falconbridge's Falcondo ferro-nickel plant in the Dominican Republic said that talks for a new contract could stumble on wage increases.
Mr Idelfonso Ciprian, president of the Sindicato Unido de Trabajadores de la Falconbridge Dominica, said. It seems the company doesn't want a deal soon, because they are definitely not offering enough in terms of wage increases," Mr Ciprian told Reuters in a telephone interview. He said the union is asking for a 65 percent hike in wages over three years. He could not say what Falconbridge has offered.
Mr Ciprian said during the last round of negotiations in 2002, the union won a 32% wage raise over three years. The contract, which covers about 1,200 production and maintenance workers at the plant, expired November 30.
In 2004, the plant produced just over 29,000 tonnes of ferro-nickel, a combination of iron and nickel used almost exclusively in stainless steel. Output in 2005 is forecast at 28,000 tonnes.
Falconbridge is one of the world's largest nickel and zinc producers and has agreed to be taken over by Inco Ltd., the world's No. 2 nickel producer.
Tarpon Industries appoints new VP of Mechanical Tubing
Tarpon Industries Inc, a manufacturer and distributor of structural and mechanical steel tubing and engineered steel storage rack systems, today announced that it has appointed Mr James W. Bradshaw to the position of VP, Mechanical Tubing. Mr. Bradshaw will report directly to Tarpon President and COO Mr Patrick Hook.
"Mechanical steel tubing is at the core of our business, and as we push aggressively into 2006, it's critical to have on board an industry veteran with direct experience managing operations and driving revenue growth," said Mr. Mr Hook. "Jim's proven track record of scaling several leading steel tubing and steel manufacturing companies to more than $150 million in sales will be invaluable as Tarpon focuses on driving growth both organically and through strategic acquisitions. We look forward to having Jim join our management team."
