February, 03 2006
VSP to host refractory conference
RINLs Visakhapatnam Steel Plant VSP would host the two-day ''India International Refractories Congress IREFCON 2006'' in association with Indian Institute of Metals from today. IREFCON organizes the Congress bi-annually since 1994 and the theme of this Congress is ''Emerging Challenges and Opportunities for Refractory Industries''.
The Union Minister of State for Coal and Mines Dasari Dr Narayana Rao would inaugurate the program. RINL CMD Mr Y Siva Sagar Rao would deliver the welcome address and CEO of JS Steel Ltd Dr BN Singh would deliver kay note address.
Around 350 delegates from all over the country including 38 foreign delegates from USA, France, UK, China, Italy and Germany would be participating in the Convention, a VSP release said
SEBI cracks whip on Bellary Steel
SEBI, in an interim order issued on Thursday, has directed Bellary Steel & Alloys Ltd and its directors not to issue any further shares or alter its share capital till further directions.
The company and its directors have been prohibited from accessing the capital market or dealing in securities, directly or indirectly.
The SEBI order follows a complaint filed by Karnataka State Financial Corporation KSFC
Spain against bid for Arcelor
Spain joined France and Luxembourg in opposing Mittal Steel's $24 billion hostile bid for rival Arcelor on Thursday. Politicians in France and Luxembourg have already reacted angrily to Mittal Steel's bid, despite a charm offensive by Mittal Steel CEO, while Spain had been much less vocal. However, at a meeting in Madrid, Economy Minister Mr Pedro Solbes said Spain would also oppose the bid. "The position of the Spanish government will be in line with the French and Luxembourg governments," an Economy Ministry spokeswoman said. "Neither before nor today have we received any concrete information about the deal, about the industrial strategy, the business plan, about jobs," she added.
Mittal Steel's CFO Mr Aditya Mittal called the meeting with Mr Solbes "good and constructive". CEO Mr LN Mittal at a news conference in Madrid on Thursday said that he would keep working to win governments around to the bid. "The idea is not to have any misgivings or negative relations with other authorities. We've started a dialogue and we will continue...to explain the logic of this transaction," he said.
Mr Aditya Mittal says bid backed by Arcelor institutional investors
Mittal Steel has won support from Arcelor's institutional investors in France and Luxembourg for its hostile bid for Arcelor said its CFO Mr Aditya Mittal. He noted that Arcelor's institutional shareholders in Spain have not yet met to discuss the operation, but said he has already received support from shareholders elsewhere.
'Key shareholders and institutional shareholders have expressed support. They appreciate the industrial logic of the operation' and the value it represents, he said.
Rio Tinto reports record 2nd half profits
Rio Tinto Group, the world's third largest miner, had a record second half profit. Net income rose to $3 billion, in the six months ended Dec. 31, from $1.69 billion, a year earlier, the company said today. Profit for the full year climbed 58% to a record $5.2 billion up from $3.3 billion a year ago.
Rio, the world's second-biggest exporter of iron ore, garnered $1.7 billion of group profit in 2005 from the steelmaking raw material, making it the company's second-biggest earnings contributor. Copper was the largest contributor, adding $2 billion. It produced 65 million tons of iron ore in the second half 15% higher than a year ago.
The outlook for 2006 remains positive,'' as supplies continue to lag demand, Rio's Chairman Mr Paul Skinner said in a statement.
Gas blast in north China coal mine kills 23
Twenty-three miners were confirmed dead and 53 others sickened in a colliery gas blast Wednesday in north China's Shanxi Province, the local mine safety authorities said Thursday. Altogether 697 miners were working down the pit when the blast went off at around 7 PM at Sihe Coal Mine under the state-owned Jincheng Mining Group, said an official with the provincial coal mine safety supervision bureau on condition of anonymity.
The official said search and rescue work had ended at the site by 7AM Thursday and the sickened miners had been hospitalized. Most of them suffered no fatal injury except for one miner who was seriously poisoned by carbon monoxide, he said quoting hospital sources. The bureau plans to set up an investigation team Thursday to see into the accident, he said. A preliminary investigation shows the explosion occurred at an airtight area in the pit.
Sihe Coal Mine, one of the largest collieries in the coal-rich Shanxi Province, currently produces 10.8 million tons a year.
Mr Breton limits French role in defending Arcelor
It is reported that France will defend its interests in the takeover battle between Arcelor and Mittal Steel but it is not seeking funds or a white knight for Arcelor, Finance Minister Mr Thierry Breton said on Thursday. Caught in a political storm, Mr Breton stressed that France was not directly involved because it had no shares in Arcelor. He also appeared to soften his rhetoric against the bid. Asked by Europe 1 radio if he had contacted banks to help Arcelor, Breton replied, "No, not at all." Pressed to say whether he was seeking a white knight to take over the steel giant, he insisted: "That is not my role. My role is to ensure that the procedures are followed correctly." "As finance minister, my interest is to see that, if an operation like this one succeeds, this should happen under the best conditions for everybody," Mr Breton said.
Mr Breton had not previously referred to the possibility of the bid succeeding, saying on Monday he had "profound concerns" about both the form and content of the offer as it stands. He later rubbished it as the most ill-prepared he had seen. The French industry minister told parliament on Wednesday that Paris flatly opposed the bid.
France, where more than 26,000 jobs could be affected by a takeover, has loudly condemned Mittal's hostile offer but analysts say it has little leeway beyond the power to create a political nuisance for Mittal Steel.
UK also lends support to Mittal Steel
After a statement from Indian minister Mr Kamal Nath, British trade and industry secretary Mr Alan Johnson also attacked French protectionism as the political fight over Mittal's bid intensified. Mr Johnson warned against any attempts to "repel the surge of globalization", saying measures to protect "key industries from foreign takeovers" among the UK's European neighbors were "futile and self-defeating."
He said, "There are advocates of protectionism amongst some of our closest European neighbors. Measures to protect key industries from foreign takeovers where there are no state security issues are futile and self-defeating. The paradox of protectionism is that it destroys what it seeks to protect."
Belgium government seems to be taking neutral stance on Mittal Steels bid
Belgium Prime Minister Mr Guy Verhofstadt said on Thursday "We are taking a businesslike approach. We first want to see the facts and judge only afterward, He added he will meet with Mittal Steel's CEO Mr LN Mittal on Monday and also appoint an investment banker to assess the viability of the takeover bid.
Belgium's regional government of Wallonia has a small stake in the Luxembourg-based company and Arcelor employs some 12,000 people in Belgium.
Bid to strike down sale of Turkish steel maker Erdemir
A new legal bid has been launched to overturn the sale of Turkeys largest steel producer, it was announced Thursday. Claiming that the sale last October of the state owned Erdemir to Oyak, the pension fund for the Turkish Armed Forces, was contrary to the public interest, the Turkish Chamber of Mechanical Engineers said it was going to apply to the courts to have the deal annulled.
Announcing the legal challenge, Mr Emin Koramaz, the head of the Chamber of Mechanical Engineers, said that the removal of the public stake would transform Erdemir into a private sector monopoly. Mr Koramaz said that the approval of the High Board of Privatization OYK, which has the final say on state sell off deals, went against the constitution's antitrust rules.
Oyak, the Turkish armed forces pension fund, made the highest bid of $2.77 billion for a 46.12% stake in Erdemir, Turkey's only flat steel maker, in October. Oyak later sold a 41% stake in Ataer Holding, a company it had set up to buy Erdemir, to Arcelor.
News of the court challenge came on the same day it was announced that the sale of Turkish oil refiner Tupras, bought late last year by a consortium consisting of Turkeys Koc Holding and Royal Dutch Shell for $4.14 billion, had been blocked by the courts.
Mittal Steel has no plan to raise bid's cash element
Steel magnate Mr LN Mittal said on Thursday he had no intention of raising the cash portion of his company's $24 billion hostile bid for rival steelmaker Arcelor.
We have no intention to do that," CEO Mr LN Mittal told Reuters when asked if Mittal Steel could raise the cash portion of its cash-and-shares bid. "We think this is a very attractive proposition."
S Africa's Scaw Metals closes deal for AltaSteel
Two months after the proposed deal was first disclosed, Stelco announced that it has completed the sale of Alberta's only steel mill to an affiliate of Scaw for an undisclosed price. AltaSteel was one of several non core assets Stelco put on the auction block in 2003
AltaSteel's scrap based mini steel mill in Strathcona County east of Edmonton was built in 1995 and has a production capacity of 360,000 tons per year. AltaSteel has committed $60 million toward plant upgrades over the past eight years, while shrinking its workforce to 380 from about 600 in the 1980s.
AltaSteel's veteran CEO Mr Peter Ouellette says earnings have tripled over the past decade as the mill has moved from commodities to specialized steel products for the global mining, oil and gas, construction and automotive markets.
The South African steelmaker is a wholly owned unit of Anglo American
ACCC approves BHP JFE iron ore JV
The Australian Competition and Consumer Commission ACCC has approved BHP Billiton Ltd's iron ore JV with Japanese JFE Steel. The deal will see JFE take a 20% stake in the Western Four deposit at BHP Billiton's Yandi iron ore mine in Western Australia, alongside the miner's two existing JV partners. The partners will ship 16 million tonnes of iron ore a year to JFE Steel for at least 11 years.
ACCC gave final approval to the deal, signaling it was satisfied it would deliver a net public benefit. "With expectations that the demand for steel in Japan will continue to be strong, the joint venture hopes to develop long term export relationships with purchasers in Japan," the ACCC said.
BHP Billiton will retain a 68% cent stake in the Western Four deposit, which contains an ore reserve of about 115 million tonnes.
Bidders lining up for Anglos Highveld stake
Several companies had approached Anglo American for its 79% stake in Highveld Steel & Vanadium Corporation, Highveld said yesterday. Anglo American said last year that it would sell Highveld and other non core businesses to concentrate on mining. In a statement to the JSE, Highveld said Anglo American had appointed advisers for the sale and that nonbinding bids from a number of companies had been received. Participants in this process will start their due diligence investigations in the coming weeks, it said.
The company had appointed a group of independent directors to advise it on the proposed sale. The committee had appointed Standard Bank to carry out a valuation once a final and binding bid had been received. It is not known how much Anglo American wants for Highveld, but a group of steel analysts said late last year that the price could be between R6bn and R10bn.
The sale of Highveld has sparked speculation about likely new owners. Steel producer Mittal Steel SA has said it might consider buying Indian conglomerate Tata said last year that it was keen on Highveld as it wanted to expand its steel production. It is also reported in media that Russian Metalloinvest has also shown interest
In another move, a consortium led by Kermas SA is bidding to acquire a controlling stake in Highveld Steel & Vanadium from Anglo American, Kermas director Mr Danko Konchar said. The local arm of UK based Kermas Group, which owns ferro-alloys producer Samancor Chrome, had submitted a non-binding bid for the stake, he said. He declined to name other members of the consortium. Kermas Group also has metals production assets in Russia and Germany.
Outokumpu Oyj posts loss for 4Q 2005
Finnish metals group Outokumpu Oyj reported a fourth quarter loss of Euro 179 million, citing a tough stainless steel market and high raw material prices as major factors. In the fourth quarter a year ago, the company posted a profit of Euro 105 million. Outokumpu wracked up a loss for the year of Euro 363 million compared with a profit for 2004 of Euro 386 million. The loss came despite an 8 percent rise in sales for the year to Euro 5.5 billion.
"This year will be marked by implementation of all our cost-related actions and the benefits will be fully visible in 2007," CEO Mr Juha Rantanen said in a statement. "Last year we experienced a very tough situation in stainless markets, especially within demand grades. The main reason was heavy de-stocking by our customers, who reduced demand and put pressure on prices," Mr Rantanen said. The company last fall announced major cost-cutting measures, including closing its Coil Products Sheffield business unit in Britain.
Russian OMK reports 45% rise in net profit in 2005
Russian steel company OMK reported Thursday that its net profit in 2005 had increased by an estimated 45% YOY to $353 million. The company's earnings totaled more than $2 billion in the reporting period, OMK said in a statement.
The OMK group of enterprises manufactured 1.1 million metric tons of pipes in 2005, up 15% from a year earlier. The company spent $506 million on investment programs in 2005, including $54 million in circulating assets, up 85% from 2004. In 2005, the company expanded its production of large-diameter pipes intended for the construction of large trunk pipelines, such as the North European Gas Pipeline and the Eastern Siberia-Pacific oil pipeline.
"The company improved its financial performance after it expanded output and optimized and modernized its production capacities," OMK President Mr Anatoly Sedykh said. The company's performance can also be attributed to the favorable market situation, he added. Mr Sedykh said the year 2005 had proven to be a success for the sector as a whole and for the company in particular. According to Sedykh, Russia produced 6.7 million metric tons of pipes in 2005, or 600,000 metric tons more than last year.
Techint Incorporates HYL Technologies
Techint Technologies has acquired the HYL Technology division of Hylsamex SA, the Mexican steelmaker absorbed into the new Ternium group last year. It will now be known as HYL Technologies SA de CV, under which Techint commercialize and undertake direct reduction plant projects worldwide. The HYL process for gas-based direct reduction was developed and marketed by Hylsa, and is one of the leading alternative iron making processes available to steelmakers.
Mr Roberto Pancaldi, president and CEO of HYL Technologies stated The synergy between the long established HYL brand name and technological expertise, and the strength and reputation of Techint Technologies, makes a perfect match for further serving the needs of the steelmaking market. The HYL Process is a valued addition to Techints line of steel mill technologies.
Techint Technologies is a unit of the Techint Group, which acquired Hylsamex in August 2005 and consolidated it with its other steelmaking holdings to form Ternium.
Kumba to double Inner Mongolia zinc smelter capacity
Kumba Resources and its Chinese partners in the Chifeng zinc smelter are joining forces with three other Chinese companies to more than double output at the plant to 110,000 tons per year by 2008. Kumba's current partners are Chifeng Hongye Zinc Smelting Company and Chifeng Baiyinnuoer Lead Zinc Mine Company. Together with Kumba, they produce 50,000 tons per year of zinc.
The partners will vend their 50,000 ton smelter into the new project and China Nonferrous Metal Industry NFC will stand guarantee for the loan to expand capacity. Kumba's share in the expanded operation will be 23%.
"This is certainly a business we are very confident in," said Kumba investor relations manager Mr Trevor Arran. "The Chinese engine for zinc is really running." China is a net importer of the metal. All Chifeng's production will be sold in China Mr Arran said.
Inco Indonesian unit to raise nickel output
PT International Nickel Indonesia, a unit of Inco Ltd, the world's second biggest nickel miner, aims to raise production by 25% by 2009 to meet rising demand. The company's production last year exceeded the 160 million pounds target and it aims to make 200 million pounds by 2009, Mr Sri Kuncoro, the director for corporate external relations, told reporters.
"We export to Japan, and the demand keeps rising," he said. "If we look at the world's demand, growth of nickel demand may rise between 3% to 4% this year."
German piping group EHR enters SA's energy sector
German pipe construction company Essener Hochdruck Rohrleitungsbau EHR launched a branch office in South Africa in January to supply the countrys growing energy infrastructure requirements. EHR, which supplies a range of services in pipe construction, including consulting, design, procurement, fabrication, construction and maintenance, says that it will be aiming to supply the energy sector with specialized piping, including high-pressure piping.
EHR South Africa will be 39%-owned by the parent company, 33% owned by local company Kog Fabrications and 28% owned by the newly appointed CEO of EHRs local branch Ms Shirley Chauke.
EHR supplies pipes for thermal plants, nuclear plants, water-processing plants, refueling plants, gas and water networks, and other industrial-piping applications.
Cleveland iron Ore Company booming
Cleveland-Cliffs Inc reported that sales increased by 46% and earnings hit $324 million in 2004 after the company lost $33 million in 2003. Sales for the first three quarters of 2005 totaled $1.27 billion, up by 45% over the previous year. Earnings increased 75% to $210.5 million. Fourth-quarter results will be released this month.
The company began as Cleveland Iron Co. in 1847, its iron ore was the first load to pass through the Soo Locks connecting Lake Superior and Lake Michigan opened in 1855. The business eventually became the Cleveland Iron Mining Co. In 1890, with William G. Mather at the helm, it merged with another mining concern, Iron Cliffs Co., whose founders included Samuel J. Tilden, the Democratic nominee for president in 1876. The merged company became known as Cleveland-Cliffs Iron Co.
Cleveland-Cliffs has six mines in Michigan, Minnesota and eastern Canada that produce low-grade ore that is then concentrated and made into pellets for use in steel company blast furnaces, mostly in North America. Last year the company bought Portman Ltd., the third largest iron ore producer in Australia.
Baku Steel resumed production
The Baku Steel Company has announced that it has resumed production to reach 100% of capacity yesterday. According to the information in media the Company has been able to secure enough scrap and further supplies are continuing.
Baku Steel Company which had suspended its production for 2 weeks, utilized this period for conducting repairs
Baku Steel Company which has launched production since May, 2001 invested $76 million of capital in the enterprise so far. $7.5 million of it was invested last year and it is planned to invest $3.5 million more capital in 2006. Volume of output of the Company was 330,000 tons last year and is planning it to increase to 400,000 tonnes level during 2006
IISI to open office in Beijing
The International Iron and Steel Institute IISI yesterday announced that it would open a second office to be based in Beijing China in April this year. The institute said in a statement that the new office would improve the quality of information on developments in the Asia-Pacific region for the benefit of IISI's worldwide membership. The office will also reinforce IISI's service to our members in the region.
The new office will be led by Dr Nae Hee Han. Along with her responsibilities as Head of the Beijing Office, Han will also become IISI's chief economist. Ms Han has a Doctorate in Economics from Pennsylvania State University and is the author of many papers on the steel industry, economic development, and steel trade issues in Asia. She joins IISI from the Posco Research Institute where she was Director of the China Study Centre and Head of the Posri Office in Beijing.
The new office in Beijing will be a second centre of excellence for IISI. It will complement the services offered by our Brussels office, said Mr Ian Christmas, Secretary General of IISI.
High rail tariffs make Ekibastuz coal non competitive
Bogatyr Access Komir GM Mr Dennis Price expressed anxiety about the increasing railway tariffs for the transportation of Ekibastuz coal as Kazakhstan Temir Zholy has revised tariff twice in 2006 by almost 18.4%, threefold more than the official inflation rate.
The traditional buyers of Kazakhstans fuel are the power stations of Russia but Ekibastuz coal producers are losing competitiveness on the Russian coal market due to the increase in freight. Several years ago Bogatyr supplied coal to 9 stations of Siberia and Ural. Today their number reduced to 6. In 2005 16.5 million tons of coal was shipped to Russian consumers by 3.3% percent less than in 2004. Further reduction of the sales volume in Russia will cause cuts in production output.
Par state government plans pig iron plant JV with CVRD
It is reported that Brazil's Parstate governor Mr Sim Jatene is in talks with CVRD to build a steelmaking plant in the state. As per a state official "The idea is to build a steelmaking plant using the existing pig iron industry in the state," adding that the project is in an early stage. As such, the official could not discuss CVRD's specific role in the project nor the percentage of government control.
Plant investments could total US$350mn and CVRD has showed interest in the project, as long the pig iron producers agree to enter as partners
The plant could be built in the region of Marabcity in the state's south, "a strategic location" that would allow investors to transport high temperature liquid iron.
Mittal Steel SA CFO moves to parent company
Mittal Steel South Africa said that Mr HC Banthia, its executive director in charge of finance would resign from the company's board from February 17 to take up another position in the steel group.
Mr Banthia has been on Mittal Steel SAs board since last August. Mr Banthia was previously Chief Financial Officer of Mittal Steel Galati and headed the finance function of the group's operations in Romania and Macedonia.
