February, 21 2006
Chhattisgarh announces support to TATA Steel plant in Bastar
"TATA Steel which inked a deal with the state government in June last year for setting up a 5 million tonne plant in mineral rich Bastar will get 500 million tonnes iron ore stocks from Chhattisgarh's Bailadila area in Dantewada district for 50 years besides 2,500 hectare land for the plant State Finance minister Mr Amar Agrawal informed the assembly. TATA Steel will set up the integrated steel unit in two phases with a Rs.100 billion investment.
The minister also said that in addition to the iron ore stocks from the Bailadila mines, the government would recommend to the central government to provide iron ore through the public sector National Mineral Development Corporation, which has three major mining blocks in Dantewada. Mr Agrawal said the government would ensure coal linkage facility to the company through the public sector South Eastern Coalfield Limited.
The state government would also provide 322 MW power to TATA Steel for the Bastar plant till it sets up its own captive power plant and supply 5 million gallon per day water during the plant construction period and 35 MGD when it actually starts production. The state government will help in getting the railway ministry's green signal for laying tracks from the plant site to the nearest railway station for which land would be provided by the government and TATA Steel would fully compensate the affected landowners.
Indian PM discusses Mittal Steel bid issue with Mr Chirac
Prime Minister Dr Manmohan Singh said that he discussed with Mr Chirac the concerns of his Cabinet colleagues about the troubles Mr Mittal is reportedly facing in Europe in his acquisition bid. PM said "I did raise Mittal's issue with President Chirac. It is my hope that all the stake-holders in this matter get justice."
It is also reported that PM did not seem to share the enthusiasm of some of his ministers to exert pressure on the European Union or France to bail out one particular business house.
TATA Steel introduces rubber covered rolls in galvanizing line
Tata Steel has introduced rubber covered rolls with modified formulations in the continuous galvanizing line. TATA Steel Deputy MD Dr T Mukherjee said that ''the technique for rubber covering has been developed by a team of in-house professionals of the Cold Rolling Mill in Metallogy Lab.
Rubber Technology Centre of IIT Kharagpur was the knowledge partner and signed a Memorandum of Understanding with Tata Steel to support this project.
A Tata Steel release said here today this innovation would contribute to the company's turnover substantially and the Company has applied for patenting the technology and rubber covering.
Kumba to look into possible rights conflict in Senegal
South African iron ore, coal and zinc producer Kumba Resources is investigating whether its rights to a Senegalese iron ore exploration property had been infringed, CEO Mr Con Fauconnier said. The investigation is triggered by press reports that Mittal Steel had signed a MoU with the Senegalese government development agency, possibly over the same concession on which Kumba holds rights and has spent several millions of dollars exploring.
Mr Fauconnier emphasized that Kumbas investigation into the report had just begun, and it was too early to say if Kumbas rights had been infringed.
The Faleme iron ore deposit in Senegal is a well known resource that Kumba has been exploring for several years. The groups estimate is that about $950m will be needed to bring Faleme into production by 2011.
Mr Chirac denies racism in reaction to Mittal Steels bid
French President Mr Jacques Chirac on Monday denied racism in the European reaction to Mittal Steel's hostile takeover bid for rival Arcelor SA, saying he had no problem with an Indian taking over a European company. Mr Chirac said: "In principle, we have absolutely nothing against a non-European taking over a European company."
Mr Chirac told reporters that European officials were still waiting for an explanation for the bid before making any final decisions. "We were given no reasons for this bid, we have no notions of what intentions, or what lies ahead of the company in question," he said. "We're simply standing by waiting for explanations to be given."
Ukraine president vetoes law banning sale of Nikpol Ferro
President Mr Viktor Yushchenko vetoed a law banning the sale of the Nikopol ferro-alloy plant, returned to state hands through court action from former owners linked to Ukraine's previous leaders. Parliament last week barred any new sale by placing the plant on a list of sites to be kept in public hands on grounds of strategic economic importance.
The president's press service said parliament's move was at variance with provisions of the law on privatization as the cabinet was not involved in discussing the matter of including the plant in the list in question. The statement also said the ferro-alloy plant did not meet the criteria for the list.
Parliament could now overturn Mr Yushchenko's veto by mustering 300 votes in favor of its earlier decision. In last week's vote, 289 deputies voted in favor in the 450 seat chamber.
Arcelor dismisses Atticus's call for talks with Mittal Steel
Arcelor dismissed a call to open talks with suitor Mittal Steel by a hedge fund Atticus known for its active participation in bid situations. Arcelor spokesman Mr Jean Lasar said about the letter, "For us nothing has changed." "There is not a good industrial plan, and our board of directors will only be in a position to consider a bid by Mittal Steel if it is made in cash only," he added.
Atticus Capital said it had written to Arcelor's CEO to express dissatisfaction with the company's refusal to consider the $22 billion bid by Mittal Steel. Atticus Chairman Mr Timothy Barakett said in a letter to Arcelor, which was released late on Sunday, "We believe in the compelling industrial and financial merits of the transaction, which would offer synergies and strategic benefits to all participants in an industry in need of consolidation."
Bluescope MD calls for reduction in iron ore prices
BlueScope Steel called on one of its main suppliers of raw materials BHP Billiton to slash its iron-ore prices following the recent slide in world steel prices. Prices of steel items have fallen in recent months as booming steel production in China has led to global oversupply, whereas the iron ore prices are forecast to rise.
Bluescope Steels MD Mr Kirby Adams said it was time for big iron ore producers to lower prices. "I don't think there is anyone in the global steel industry that is happy with pricing for iron ore or coking coal," he said. Mr Adams said that prices for other raw materials such as scrap metal had begun to decline in line with market conditions in the steel industry. "The scrap market is an open and transparent one, but the iron ore market is completely the opposite," he said. "Steel prices have come off and it's time for iron ore prices to come down."
Bluescope is battling to contain costs and yesterday reported a 38%per cent fall in interim net profit. Mr Adams attributed the decline mainly to higher raw material costs, which ripped $120 million from the bottom line. "The main factors contributing to the expected weaker second-half earnings are from lower global steel prices and the full effect of higher contract iron ore costs on earnings," he said.
Mr Mordashov to transfer mining & coal business to Severstal
It is reported that Severstals owner Mr Alexey Mordashov has decided to transfer the mining and coal belonging to him to his company. The main advantage for Severstal will be the opportunity to receive cheaper credit, which will be needed by the company for acquisitions of assets in Russia and abroad.
It is estimated that its capitalization after the supplemental emission will reach $11.4 billion thus exceeding Novolipetsk Steel in that regard which has capitalization of approximately $11 billion.
Mr Mordashovs off shore company Cypriote Frontdeal, which already holds 84% of Severstal, will transfer a package of railroad and coal assets to the authorized capital of Severstal as payment for its share. Those assets are now under the management of Severstal Resource and include Kuzbassugol, Pechoraugol, Vorkutaugol, the Vorgashorskaya mine, Pervomaiskaya mine and Berezovskaya mine, Olenegorsky processing ore plant and Karelian Pellets.
OneSteel posts net up by 19.6%
Australian OneSteel posted a half year net profit of $84.1 million, up 19.6% on the previous corresponding period. Sales revenue for the first half was $1.99 billion up by 5.2% on the previous corresponding period.
OneSteel CEO Mr Geoff Plummer said Company had seen a 10.1% increase in construction expenditure across Australia, driven by further expansion in the engineering and non-residential sectors which more than offset continued softness in the residential construction sector. The company had also seen an 11.9% increase in domestic steel prices, adjusted for special projects. "Over the remainder of the current financial year, market and operating activity is expected to be similar to the first half," Mr Geoff Plummer said.
Mr Plummer said costs had increased by $166 million over the period, largely driven up by rising prices for coking coal. "We are certainly seeing a number of areas where there are pretty clear signs that the coking coal prices will come off over the coming period," he said. Mr Plummer said OneSteel would not see benefit from any fall in the coking coal price this year, as its prices were reset at the end of the year.
Northeast Asian Steel Community formed
POSCO's chairman Mr Ku-Taek Lee emphasized that a Northeast Asian Steel Community in Korea, China and Japan would greatly empower Northeast Asian economic and industrial cooperation, while speaking at the founding meeting of Development of the Steel Industry in Northeast Asia in Seoul. The Korea-China-Japan Society of 30, which is dedicated to founding a new order in 21st century Northeast Asia, is comprised of political, financial, academic, and cultural dignitaries from Korea, China, and Japan.
Mr Lee made a presentation that the international steel market has grown rapidly and Northeast Asia has been in the center of this growth. The cooperation channels through joint projects and partnerships between leading steelmakers, including Nippon Steel Corporation, POSCO, Shanghai Baosteel, and Shagang Group, have built a foundation of mutual growth in Northeast Asia's steel industry.
Mr Lee listed what Northeast Asian steel industries must achieve for further growth including a stable steel industry based on balanced supply and demand; a stable supply of raw materials for maximum efficiency; sustainable growth through environmentally-friendly management; and stable trade through the Northeast Asian Steel Community to counteract global integration. He also added that a steel community comprised of the leading steelmakers in these three nations would lead to a Northeast Asian Steel Community.
Evraz & Mitsui to form JV for Denisovskoe coal deposit
Russian steel manufacturer Evraz Group is planning to set up a JV with Mitsui to develop the Denisovskoe coking coal deposit in Russia's Yakutia, according to Evraz's press office.
The JV will invest $260 million to produce 2.4 million metric tons of coking coal a year, with the entire output exported to Asia.
Bolivian president postpones El Mutn bidding for 90 days
Bolivia's President Mr Evo Morales has postponed for 90 days the bidding process for the El Mutn iron ore deposit as per a report by state news agency. Mr Morales postponed the process to correct deficiencies in the bidding rules and contract in order to "guarantee the establishment of Bolivia's first steel company," the report said.
The updated bidding rules and contract will require the winning bidder to process El Mutn iron into steel locally, and for natural gas to be used in the process. "A new economic phase begins, with the industrialization of raw materials and an active government presence that will benefit the population," the report quoted Mr Morales as saying.
UAE's ADPICO orders for 24 pipe mill from SMS Meer
Abu Dhabi Metal Pipes & Profiles Industries Complex LCC ADPICO a tube making plant in Abu Dhabi has placed an order with SMS MEER GmbH for a 24' HFI pipe welding line at an approximate cost of AED950 million. This would make ADPICO a leading pipe producer in the Middle East region with a total capacity of 1.2 million tonnes per year and also the only company capable of producing 24 diameter pipes for the oil & Gas industry.
ADPICO has already begun a second phase of investment that will introduce galvanizing capability as well as the ability to produce in accordance with API standards. It has seven lines in operation and two more are in the process of being commissioned.
ADPICO is part of Safa group of companies which owns four production units, Adpico based in Abu Dhabi UAE, Saveh Rolling and Safa Rolling in Saveh, Iran, and Alfa Steel in New Port Wales UK. By 2007, the Safa Group intends to get into production of strips, plates, and other steel specialty products. The group is poised to become a world leader in the transformation of steel with a capacity of 12million tonnes per year.
Kremikovtzi revises plans for 2006
Global Ispat owned Kremikovtzi in Bulgaria announced that it has reduced its 2006 output target by 13% compared to earlier plans. Its new operations director Mr Vilas Jamnis said the mill plans to raise production by 36% to 1.5 million tonnes in 2006 but this will still be below earlier estimates of producing 1.7 million tonnes. ''We are planning to raise steel output to 1.5 million tonnes in 2006. We hope to reach production of 2.0 million tonnes in the next two to three years,'' Mr Jamnis said.
Kremikovtzi's CEO Mr Alok Gupta had announced in last September that company plans to invest $300 million over the next four years that should allow the mill to increase finished steel output to 1.7 million tonnes this year and up to 2.0 million by 2009. Now the management team said it has revised its targets from September after it looked more carefully into the mill's operational and financial situation and reassessed its investment program. It is hard to forecast production based only investment intentions. We will have first to install the new equipment.
Kremikovtzi produced 1.1 million tonnes of end-products last year, down from 1.2 million in 2004 after it cut output by 20% in the third quarter due to sagging demand on international markets. Ispat Industries bought Bulgarian Finmetals Holding, which controlled 71% in Kremikovtzi in August for an undisclosed sum rumored to be at around $100 million.
Corus to reopen mill at Stocksbridge
Anglo Dutch Corus Engineering Steels is reopening a mothballed billet mill at Stocksbridge because its Aldwarke primary mill, which was modified to take over the order book from the oil, gas and energy industries, is taking longer than expected to get up to full speed.
The company says it does not know how long the Stocksbridge mill will need to operate. "It will run as long as there's demand in the market but Aldwarke will gradually be reaching full output levels and when it does the Stocksbridge mill will be mothballed again," said a spokesman.
Danieli to revamp hot mill at Beta Steel
Indian based mini steel mill Beta Steel Corp has assigned a hot mill modernization to Danieli Wean United, with the goal of increasing mill productivity, increased coil weight of 30 tons, better finished product quality and a wider range of steel grades. Danieli will supply new mechanical and hydraulic equipment, as well as the related electrical systems and Levels 1 and 2 automation and process control systems. The revamp will be scheduled during two shutdowns this year.
The scope of work involves a new slab discharge machine at the reheating furnace exit side and new descaler boxes at furnace exit, on the rougher and at finishing mill entry. A new crop shear will replace the existing device ahead of the finishing mill to increase the cutting capability for API grades. An automatic, quick change system for the work rolls on the finishing mill will help to increase production time.
The existing water wall strip cooling section will be replaced by a new system capable of controlled pattern cooling required for API grades. The existing second down coiler will be replaced by a new unit, capable of handling higher-strength and thicker materials, with a significant increase in coil weight. New, horizontal-axes coil handling including coil inspection, strapping, weighing, and marking will be installed to avoid coil tilting and edge damage, and to facilitate the final processing of coils before shipping.
POSCO commissions auto parts facility
POSCO announced it completed building two facilities to manufacture tailored lightweight automotive components in Gwangyang. POSCO said its new hot press forming line and hydro forming facility are capable of producing a million parts and 600,000 stainless units per year, respectively. By operating the two facilities, POSCO said it expects to contribute towards carmakers' competitiveness by providing a total solution for steel materials and components as well as tailor welded blanks.
The hot press forming technology shapes the steel sheet at a temperature of over 900 degrees Celsius and cools it down to produce auto components that weigh between 150 and 200 kilograms. The technology allows easier processing of ultra solid materials and keeps them from springing back to their original forms.
Hydro forming is a method of shaping metal by using high water pressure. The technique allows the formation of large components without having to weld smaller parts together, slashing production costs by about 15% and reducing product weight by up to 30%
POSCO supplies auto parts several automakers including GM Daewoo, Renault Samsung, Ssangyong and China's Changan Group.
Iran comments on Mittal Steels proposal for Mobarake
Iran's Industry and Mining Ministry deputy Mr Iraj Akbarie welcomed Mittal Steels $5 to $6 billon proposal to buy Isfahan based Folad Mobarake but said that first legal matters must be solved. "Isfahan's Folad Mobarake is considered one of the most modern steel industrial units in the world, and we are pleased to have reached this position," said Mr Iraj Akbarie.
He also noted that this Ministry is fully capable of absorbing foreign investments. "This needs to go through legal stages and to this fact that Isfahan's Folad Mobarake is under the 44th article of the Constitution, before releasing it to foreign investments first this matter must be solved and after the announcement of the 44th article release may be possible," he added.
Delta Steel calls for dredging of River Niger
Dr Onyeabor Nwabuokei MD of Delta Steel Company has called on the Nigerian Federal government to dredge the River Niger to ease ship passage. It is imperative that the river be dredged so as to allow the 25,000 tonnes ship berth at our harbor to lift our steel for export and even for dropping of our imported raw materials, he said. He stressed that the company stands to lose through the payment of unnecessary freight charges if this was not done.
Mr Nwabuokei said the river passage to the companys harbor was too shallow and made it impossible for large ships to berth to lift or off load any product or raw materials. There is need to lift our products at our harbor instead of the present arrangement that makes us to spend twice on handling charges, before our products are exported.
We are therefore appealing to the federal government to dredge the river to enable large ships to berth at our harbor to reduce the cost in freight and handling charges for our export and imports, he said.
Western Canadian Coal announces Q3 results
Western Canadian Coal Corp has announced its operating results for the three months ending December 31, 2005. Operating profit of C$3.7 million on sales of C$9.9 million is reported. Year to date operating profit of C$19.3 million on sales of C$48.5 million is also reported.
Net loss for the quarter was $0.4 million compared to a net loss of $5.0 million for the same quarter in 2004. The current quarters loss includes exploration expenses of $4.3 million, of which $3.9 million relates to WCCCs proportionate share of exploration expenses recorded by the Belcourt-Saxon Coal Limited Partnership.
Sale for the Q3 was of 82,979 tonnes of PCI coal at an average price of C$118.78 ($101.73) per tonne. Cash costs for production were $70.95 per tonne compared to $72.11 in the prior quarter.
Makiyevka receives loan from Mokrald Trading
Ukrainian Donetsk region based Makiyevka Metallurgical Plant has received a loan of 140.1 million hryvni ($28 millions) from Mokrald Trading Ltd.
Makiyevka said that the loan was repayable in 38 months at 7.15% annually and was given under a deal signed on November 24, 2005.
Mittal Steels Bosnia war memorial plan halted
Plans to build a memorial at the site of a notorious concentration camp of the Bosnian war have been suspended after the main sponsor pulled out. Mittal Steel said it was disappointed it had to abandon the plans for the memorial but recent developments had forced the decision and it had become clear that many locals opposed the plans and under the circumstances they would be suspended.
Hundreds of Muslim and Croat prisoners were tortured and killed by Bosnian Serb guards during 1992 at the Omarska iron ore mine in northern Bosnia. The memorial project had brought together Bosnian Serbs, Muslims and Croats in a rare example of cross-ethnic co-operation over such a controversial issue. But in recent weeks more extreme voices on all sides have begun to oppose the plans.
The abandonment of the memorial project is a blow to those who have been promoting the reconciliation process and also a sign of the severe difficulties that foreign companies face when they try to invest in Bosnia.
Mr Rinat Akhmetov to enter Ukraine's parliament
Mr Rinat Akhmetov, a coal and steel magnate and the richest man in Ukraine is reported to be in mood to contest the next month's parliamentary elections and may give up business for politics if he wins a seat. Ukrainian news agencies quoted him as saying during a rare campaign appearance in eastern Ukraine that he would hand over control of his business assets to the team that manages his company, System Capital Management. "I don't plan to work in the government, I plan to work in parliament," said Mr Akhmetov.
His business empire also includes the country's third-largest steel producer, a popular daily newspaper and the Donetsk Shaktar soccer club. "I'm a guy who takes responsibility, responsibility before society, before my 160,000 employees and responsibility before fans," he was quoted as saying by news agencies.
He is reported to be backed by the party of presidential candidate Mr Viktor Yanukovych. Mr Yanukovych had suggested that he might tap Mr Akhmetov to become prime minister if Yanukovych's Party of the Regions won enough support to form the governing coalition after the elections. That would make him No. 2 to President Mr Viktor Yushchenko.
Indonesia Inco to spend $151 million in 2006
PT International Nickel Indonesia plans to spend around $151 million this year to develop its business Inco President Mr Bing Tobing is reported to have said. The investment will include the nickel miner's plans to optimize its nickel plant, sustain working capital.
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