March, 10 2006
MMK for acquisition rather than greenfield project in India
As per reports in a Russian daily, Magnitogorsk Iron & Steel Works said that it is considering acquiring a steelmaker in India to tap into the lucrative Asian metals market. The company is exploring all opportunities in the country and may reconsider its previous plan to build a Greenfield factory, instead opting for an acquisition citing an MMK spokeswoman. "At present, we are evaluating all the possibilities," said Ms Yelena Azovtseva, a spokeswoman for MMK, adding that no final decision had been made.
"It's no secret that India has performed very well in recent years. We see that if we don't seize that opportunity, our competitors will," she said, calling the move part of the company's new strategy to pursue significant expansion outside Russia.
MMK announced its intention to build a smelter with a 10 million ton annual capacity in 2005.MMK held talks with authorities in the Orissa region of India last November about building a $10 billion steel plant, and the proposals were discussed further last December during Indian Prime Minister Manmohan Singh's visit to Moscow. On Thursday, India's Financial Express, citing a senior Indian government official, reported that the issue of land allocation the main sticking point for MMK's expansion in India would be resolved in the near future.
RINLs sales turnover up by 18% in February
RINLs Visakhapatnam Steel Plant clocked a sales turnover of Rs 862 crore in February 2006, registering a growth of 18%, as compared to Rs 728 crore in the corresponding month of last year. The company has achieved the best-ever performance for any February since inception in production of hot metal, liquid steel, cast bloom, billets, bars, wire rods, saleable steel.
With this, the cumulative sales turnover during April 2005 to February 2006 touched Rs 7,281 crore, which represents a growth of 5% as against Rs 6,907 crore in the corresponding period last year. This includes domestic sales of Rs 6,882 crore and exports of Rs 399 crore, according to a press release.
The cumulative production from April 05 to February 06 stood at 3.77 million tonnes in hot metal, 3.28 million tonnes in liquid steel and 2.91 million tonnes in saleable steel, representing a growth of 6 per cent, 2 per cent and 2 per cent respectively over the corresponding period last year.
CIL & SCCL make Rs 9,000 crores provision for modernization
For the purpose of mechanization and modernization of mines, Coal India Limited and Singareni Collieries Company Limited have made a special capital provision of Rs 9,175.83 crores during the 10th Plan Minister of State for Coal Mr Dasari Narayan Rao informed the parliament. Mr Rao said a provision of Rs 1,897.52 crore for 2005-06 and Rs 2,198.54 crores for 2006-07 has been made for the purpose.
Modernization of coal mines is a continuous process and efforts are made to ensure that the target set for the Five Year Plan and respective Annual Plans for the coal companies are met.
HC admits PIL filed against Nagarjuna Power project
The Karnataka High Court on Wednesday admitted a Public Interest Litigation filed by the Jana Jagruthi Samiti, Nandikur, questioning the setting up of the coal-based power project by the Nagarjuna Power Corporation at Yellur near Padubidri.
Speaking to reporters Mr Vijay Kumar Shetty the legal advisor to the Jana Jagruthi Samiti, said that the based on the PIL filed the High Court had issued notices to the parties- the Union Government, State Government, Karnataka State Pollution Control Board and Nagarjuna Power Corporation, However no notice has been issued to KIADB.
In its petition the Samiti had mentioned that the coal-based power project would have disastrous impact on the environment. Further it argued that Nagarjuna had got approvals from various departments by furnishing wrong information. In addition to this expert committee reports were also not taken into consideration before approving the project.
There was no public hearing in the Nagarjuna Power Corporation project and Nagarjuna in its project documents had mentioned that the project would be taken up at Padubidri, but it is being planned at Yellur. Yet another violation is that even in the notification for acquiring land there was no mention that the land was meant for industrial purpose, disclosed Mr Shetty.
Karnataka permits iron ore transportation
It is reported that the ousted state government of Karnatak led by Mr Dharam Singh Government parted with a big bonanza to the iron ore transporters in the State. The orders signed by the Mr Dharam government on January 18 will allow transportation of iron ore from patta lands where there are layers of iron ore. The beneficiaries mainly belong to Bellary district, followed by Belgaum, Chikmagalur and Chitradurga districts.
Of a total area of 719.19 acres from where permits are given to transport iron ore, Bellary district alone accounts for 667.19 acres while Chikkamagalur gets 21.80 acres, Chitradurga 20.24 acres and Belgaum 10.06 acres.
It is feared that iron ore from forestland could be dumped into these patta lands from where it will be transported. There will be a spurt in movement of vehicles as at least 2 lakh tonnes of iron ore can be transported from each acre of land.
Global steel prices to be stable through Q2 UBS
Analysts at UBS believe that global steel prices would be stable through Q2, given the hike in steel prices in China.
In a recent research note, the analysts mention that global steel prices are being supported by an increase in steel prices in China over the past few weeks. Also, an anticipated increase in iron ore prices would support steel prices going forward, the analysts believe. Steel prices are likely to increase marginally in the forthcoming months, UBS adds.
Saudi Hadeed takes stake in Australian Sphere Investment
West Perth-based Sphere Investments Ltd has issued a 13% interest in the company to Saudi Iron and Steel Company Hadeed, a wholly owned affiliate of Saudi Basic Industries Corporation. It is the first move by a key Middle East steel company to secure a direct interest in an emerging iron ore producer in the region - reflecting, Sphere says, an increasing trend by steel mills globally to secure future supplies.
Sphere is well advanced in earning a 50% interest in an iron ore precinct in the West African country of Mauritania, with joint venture partner, Societe Nationale et Miniere of Mauritania. The precinct includes the advanced Guelb el Aouj project. Sphere and SNIM plan to develop a 7 Mtpa Direct Reduction pellet project in Mauritania utilizing SNIM's established rail and port infrastructure.
The Guelb el Aouj magnetite deposits have an Inferred Resource of 675 million tonnes (Mt) (36.4% Fe head grade) including 450 Mt (36.6% Fe) for the flagship East Deposit and 225 Mt (36.0%) for its Centre Deposit to support at least a 30 year life. The deposits can produce a very high quality magnetite concentrate (+70%Fe) and Direct Reduction (DR) quality pellets.
Based in Al-Jubail, Saudi Arabia, HADEED is the leading integrated steel producer in the Middle East, producing over 4 million tonnes per annum of long and flat products.
Ispat Industries to issue FCCBs
Ispat Industries Ltd's board of directors has decided to issue Foreign Currency Convertible Bonds aggregating up o US $ 125 million, subject to further requisite approvals or consents.
Ispat Industries Limited is one of the leading integrated steel makers and the largest private sector producer of hot rolled coils in India. Set up as Nippon Denro Ispat Limited in 1985 by founding Chairman Mr M L Mittal, IIL has steadily grown into an Rs 4,000 crore company, assuming its position as flagship of the reputed Ispat Group.
TATA Steel gets Richard Bay ferrochrome smelter approval
TATA Steel has secured approval for the construction of a 650 million rand high-carbon ferrochrome smelter in South Africa. TATA spent five years on development and three years on an environmental impact study following vehement opposition from residents in the area. Tata will be obliged to source local raw materials, goods and services and contract South African small businesses that meet its needs.
The ministry of agriculture and environmental affairs in KwaZulu-Natal province gave the go-ahead for the construction of the smelter at Richards Bay, north of Durban, after a long delay that at one stage almost forced TATA to consider building the plant elsewhere.
The ministry set stringent conditions on the project to ensure that concerns from environmentalists and those concerned about black economic empowerment were addressed. Tata will be required to conduct health studies among the local community and its own staff at the plant - both before and after the smelter is commissioned to evaluate their exposure to harmful emissions. There is particular concern over emissions of chromium-6, a known carcinogen.
These are among 63 specific conditions, which Tata will have to comply with, besides 20 standard ones. Other conditions cover issues such as noise, solid and liquid waste management, and the effect of the plant on human health, air quality and biodiversity in the region.
Objections may still be lodged within 30 days, and there are already indications that some environmentalists may lodge such objections. If no objections are received, work on the plant could start by next month, with a projected completion date of September 2007.
China's iron ore imports up by 31.9% in first two months
China imported 51.47 million tonnes of iron ore in the first two months, up 31.9% from a year earlier, the Shanghai based trade website mysteel.com reported. Citing customs statistics, the website said that for February alone, the country's iron ore imports stood at 24.9 million tonnes. No comparative figure was given.
In the first two months, exports of steel products rose 22.7% YOY to 3.67 million tonnes while imports fell by 19.5% to 2.82 million tonnes.
In February, the country's steel product exports were up 24.8% from a year ago at 1.86 million tonnes, with imports was down by 21.4% at 1.25 million tonnes.
Bulgarian Stomana to invest Euro 40 million in rolling unit
Bulgarian Pernik based steel maker, Stomana Industry will spend Euro 40 million on the installation of a new long-products line in its rolling unit. Economy minister Mr Rumen Ovcharov will officially flag off the Greenfield investment project on Friday.
The new facility will incorporate another Danielli technological line bought by Stomana Industry from indebted metallurgical plant Kamet in 2004 for 5 million levs. The new line should be fully assembled by the end of the year. It is expected to triple output while cutting natural gas consumption. The new production line will add 800,000 tons of reinforced concrete and steel products to Stomana's annual capacity, making it the biggest reinforced steel manufacturer in the region.
Stomana Industry, owned by the Greek Viohalco group is one of the Bulgarias top 3 steel makers together with Promet Steel and Kremikovtzi.
Shougang to stop producing steel in Beijing by 2010
Beijing's mammoth steel maker Shougang is beginning to phase out production in Beijing as one of the city's worst polluters moves toward ending all production in the capital by 2010. The new base covering about 20 square kilometers will be located in Caofeidian, an island 80 km south of Tangshan in Hebei. The new Shougang Group will employ 15,000 people and be named "Capital Steel Beijing-Tangshan Iron & Steel Joint Co Ltd".
According to Shougang's relocation plan, the company will cut the annual output of its Beijing facilities from the current 8 million tons to 4 million tons by 2008 and stop production altogether in Beijing by 2010, company president Mr Zhu Jimin was quoted as saying on Wednesday during the annual National People's Congress session. By 2010, all production facilities of Shougang Group, also known as Capital Iron and Steel Group Co, will have been moved to Tangshan, a city in the neighboring Hebei Province, the Beijing News reported.
Founded in 1919, Shougang is widely considered the flagship of China's industry. Its production base in the western suburbs of Beijing, however, has long been blamed for causing heavy air pollution as the plant's chimneys belch out thick clouds of smoke.
Despite the city's efforts to curb pollution and improve air quality in the recent decade, environment experts say unless Shougang moves, Beijing's air quality will not meet the standard the government promised in its bid to host the 2008 summer Olympics. Shougang is expected to cease production during the Olympic Games period. Shougang has also promised its new facility will use new technologies to reduce environmental impact. The new steel plant will operate in an environmental-friendly way with new equipment and technologies to improve efficiency and cut waste, Mr Zhu said.
Ryerson Steel rejects offer to settle strike
Negotiators for Ryerson Steel rejected a settlement offer that would have ended a three-day strike against the company. "Unfortunately, company negotiators have put pride before people, customers and stockholders," said Mr Mike Mezo of the United Steelworkers. "We hope that Ryerson will rethink this rejection so we can get back to work while we continue negotiations."
More than 500 workers represented by the Steelworkers Locals 9777 and 6787 and Teamsters Local 714 began an unfair labor practice strike Sunday. Ryerson had engaged in illegal activity including illegal surveillance, threats and intimidation. Charges were filed against the company at the National Labor Relations Board on Friday, March 3.
Negotiations have met 14 times since early January. Since the strike began, negotiations have continued and are scheduled for Thursday and Friday.
Mittal Steel would keep Arcelor stainless steel units
Mittal Steel said it will keep the stainless steel activities of Arcelor if its proposed takeover bid succeeds. Mittal Steel said that, by leveraging its global skills, it would be able to improve the performance of Arcelor's stainless steel division.
"Mittal Steel would hold off on examining strategic options on the stainless steel business given its turnaround expertise and potential," Mittal Steel said in slides for an investor conference in Rotterdam, posted on its Web site.
Arcelor has announced a strategic review of its stainless steel activities, which could result in a sale, a spin-off or an initial public offering.
MMK increases steel production by 8.1%
Magnitogorsk Iron & Steel Works produced 1.87 million tones of steel from January to February period, representing an increase of 8.1% from the same period a year earlier, the MMK press service informed.
The production of ore rose by 2.7% to 2.41 million tonnes the agglomerate output climbed 4.3% to 1.75 million tones. MMK also increased the output of coke by 6.9%. MMK also produced 1.58 million tones of iron ore up by 11% and 1.7 million tones of metal products up by 9%.
The export share in the structure of metal output shipment over the first two months lowered by 4.4% to 52.1%. In February the export share amounted to 50.9%.
Al-Twairgi invests in a new mill
Al-Twairgi Group began working on establishing a new SR1 billion steel mill in the second industrial city in Dammam, according to Al-Eqtisadiah with a capacity of 500,000 tonnes.
Meanwhile, one of Twairgi Group of Companies, National Company for Metal and Steel, has completed the first stage of metal production at its factory in the Western Region of the country with a capacity of 300,000 tons. It will begin implementing the second phase of production by establishing a new company with a capacity of 1.2 million tons annually by the end of this year.
Kobe Steel to lift European output of welding materials
Kobe Steel Ltd plans to invest some 1.5 billion yen to increase annual production of steel welding materials in Europe sevenfold to 7,000 tons in 2008, the Nikkei Business Daily reported, without citing sources. Starting around the middle of this year, the firm will build a new facility at its factory in the Netherlands and install six production lines. It will produce flux-cored wire in diameters of 1.2mm to 1.6mm, the report said.
Kobe Steel is boosting production in Europe to prepare for an expected increase in demand for welding materials from shipbuilders and constructors of ocean platforms used for oil and gas exploration in the North Sea and elsewhere, the report added.
It said the production increase in the Netherlands is part of a larger plan to double worldwide output of welding materials during or after 2010.
Germanys February steel production up by 0.6%
Germany produced 3.7 million tonnes of steel in February 2006, up by 0.6% on February 2005 and compared with January 2006, steel production increased by 7.6% information from the country's federal statistics office Destatis showed.
During the first couple of months of 2006, Germany produced a total of 7.13 million tonnes of steel, which is down 6.7% on the first two months of 2005.
Coal mine flooding kills 7 in Yunnnan province in SW China
Seven miners were killed and three more injured in a coal mine flooding that took place in Xuanwei City, Southwest China's Yunnnan Province, on Thursday, local sources said.
The flooding occurred just minutes past zero hour of Thursday when 10 miners were working beneath the shaft at the Zhongcun Coal Mine of Geyi Township, Xuanwei. Only three of them were rescued alive, with varying degrees of injuries.
Colliery blast leave 3 dead and 6 missing in Hunan
Three miners were confirmed dead and six others missing in gas blast that led to a fire in a coal mine in Shaodong County, central China's Hunan Province, early Thursday. Rescuers had recovered the bodies of three miners and were searching for the six missing miners.
The blast occurred at 5:18 a.m. in the Shuijingtou Coal Mine in Shaodong County, 200 kilometers from the provincial capital of Changsha. The blast happened at a workface of the Shuijingtou Coal Mine, and the fire following the gas blast hampered the rescue efforts, said Mr Li Lianshan, director of Hunan Provincial Coal Industry Bureau.
Investigation into the cause of the blast is still under way.
Shuijingtou Coal Mine belongs to the state-owned Lianshao Mining Group Co., Ltd., which boasts of annual production capacity of over 1.7 million tons. Shuijingtou Coal Mine has an annual output capacity of 150,000 tons. It generated 120,000 tons of coal last year.
SUEK plans investment to increase production
Siberian Coal Energy Company will spend $60 million on building a mill and increasing coal production at the Tugnui coalmine in Buryatia, SUEK GD Mr Vladimir Rashevsky told journalists in Irkutsk. The company plans to build a $38 million enrichment mill in 2006 and invest funds in projects over the next two years to increase coal production from the current 5 million tonnes per year to 8 million tonnes per year, he said.
SUEK's Irkutsk branch plans to produce 20.12 million tonnes of coal in 2006, which is 3% more than in 2005. Overall production will increase due to growth in production at the Tugnui mine, where production is planned at 5.5 million tonnes in 2006 up by 15% from 2005. Coal production will also grow in the Chita region, while output in the Irkutsk region will drop by 3% to 10.88 million tonnes.
SUEK is the largest coal producer in Russia and the only domestic company included in the top ten world leaders in the coal market. SUEK accounts for around 30% of Russia's domestic supplies and 20% of Russia's coal exports. The company has coal-producing branches and subsidiaries in the Krasnoyarsk, Khabarovsk and Primorye territories, Kemerovo, Irkutsk and Chita regions and Khakasia and Buryatia republics.
Siemens develops improved design for palletizing plant
The Siemens Industrial Solutions and Services Group has developed a new process for palletizing plants which due to a new plant design increases productivity, creates less pollution and, at the same time, saves costs. Improved monitoring of the roasting process and recovery of the process gases reduce fuel consumption and the amount of dust produced. When combined with optimized control of the thermal processes, the new process technology enhances the overall economic efficiency of palletizing plants.
Conventional palletizing plants are characterized by high specific energy consumption and enormous amounts of waste gas. The consequences are not only high production costs but frequently also difficulties in complying with stricter and stricter environmental stipulations. In order to meet today's market requirements, a high throughput rate and very high product quality are essential.
Due to a special design of the input of traveling grates, the pellets are not deformed. Utilizing the thermal energy of waste gases, green pellets dry faster and are up to five per cent firmer. This increases quality and the production rate. The process automation is based on the mapping of the thermal processes by means of a deterministic mathematical model, resulting in a constantly high pellet quality.
Upstream processes and the recovery of process gases considerably reduce fuel consumption, the need for replacement gases for the roasting process and the emission of pollutants and dust.
It is also possible to modernize older plants with the new process technology, which can be adapted individually to customer needs. The investment usually pays for itself within a period up to three years.
Two hurt in explosion in Chaparral Steel
Two people were injured, one critically, in a boiler explosion at the Chaparral Steel plant in Midlothian Thursday morning. The explosion released steam at temperatures estimated at 2,000 degrees. The cause is under investigation.
Chaparral is one of largest supplier of structural steel in North America.
Steel Dynamics forms joint venture for railroad ties
Steel Dynamics announced that it has formed a JV named Dynamic Composites LLC with a majority stake with minority stake of Mr Chuck Chadwell, to manufacture composite railroad ties. Steel Dynamics is licensing the composite tie technology from Primix Corp., which used to operate a plant in Atwood in Kosciusko County, where it manufactured composite railroad ties.
A location for Dynamic Composites has not been finalized, but the plant is slated to have an initial capacity of 250,000 ties per year. Steel Dynamics said North American demand for railroad ties is between 15 and 19 million ties annually, a $700 million to $800 million market. The composite tie consists of a formed steel core which is filled with concrete for stability and mass, and recycled synthetic inserts for spike retention. Both the core and the inserts are encapsulated by a synthetic material primarily made from recycled rubber and plastic. The steel used in the cores will be supplied by Steel Dynamics Flat Roll Division.
Mr Dick Teets VP & GM of Steel Dynamics Structural and Rail Division said that Mr Chadwell will manage the operations in the new plant, in which Steel Dynamics is investing $5 million. Mr Chadwell has the operational know how to take a patented idea and improve upon it and bring it to production, Mr Teets said.
US Congress approves permanent trade relations with Ukraine
US Congress voted Thursday to end Cold War trade restrictions on Ukraine, opening the way for the former Soviet republic to join the World Trade Organization. The congressional action, and President Bush's expected signature, would free Ukraine from a 1974 measure called the Jackson-Vanik Amendment that links trade benefits to the emigration and human rights policies of former or current communist states.
Ukraine hopes to join the WTO this year, and removal of US trade restrictions is necessary for that to happen.
Since 1993, the US has granted Ukraine normal trade relations on a temporary, annual basis.
Ukrainian president Mr Yushchenko, whose pro Western government was elected in January 2005, welcomed the House vote, saying, Consistent U.S. steps in support of Ukraine on the way of reform are evidence of strategic partnership between the countries.
Algoma Steel to build strength
Algoma Steel Inc is still open to a takeover offer, but won't focus on selling itself any longer, its CEO said. "I really am trying to manage expectations by letting people know that we are turning the page on that," Mr Denis Turcotte said in an interview. "We are going to push forward and continue to build Algoma's strength." Asked directly if Algoma will be sold, Mr Turcotte said: "There's nothing we're about to announce."
"Although we would continue to look at selling the business, if that made sense, more importantly we're turning the page here moving forward," Mr Turcotte said. "We're going to look at mergers, acquisitions, green fields, new product capability and joint ventures."
The Sault Ste. Marie-based steel maker put itself up for sale last May, but gave up in August after failing to find a buyer.
Eramet posts 9% rise in net income for 2005
Eramet posted group net income of Euro 377 million ($450 million) for 2005, up by 9% from Euro 346 million in 2004. The group's current operating income declined by 16% to Euro 542 million, "but was still very high," the company said. The operating margin came in at 20% of turnover, which stood at Euro 2.71 billion in 2005, compared with Euro 2.52 billion in 2004.
Eramet said its performance was affected by a decline in manganese and nickel prices in the second half of the year. It was also affected by industrial action in New Caledonia, and particularly by roadblocks at the mines and the plant at Doniambo for three weeks in the fourth quarter, which had a negative effect on current operating income of Eur64 million.
Eramet said the output for the first half of 2006 was favorable and "seems positive" as nickel prices on the LME began the year at a very high average of $6.70/lb for the first two months. The stainless steel environment is also more favorable than in the second half of 2005.
Eramet Nickel's production is expected to increase by about 15% to 68,000 mt in 2006, and the new ore enrichment plant in Tiebaghi will be operational in early 2007.
Kinder Morgan expands bulk terminal to import coal
Kinder Morgan Energy Partners LP, which operates natural gas pipelines and owns bulk terminals and rail transloading facilities, said that it will undertake a $70 million expansion of its Newport News, Va., bulk terminal to handle imported coal. Kinder Morgan said the project will expand the capacity of its Pier IX bulk terminal in Newport News by 30% upon completion in the first quarter of 2008. The company also said it signed a long-term agreement with coal production company Drummond Coal Sales that will support the expansion.
The Pier IX terminal is expected to have an import capacity of 9 million tons after the expansion. Kinder Morgan said the facility currently has 1.4 million tons of storage capacity for coal and 300,000 tons for cement.
"Supplies of imported coal into the United States are expected to increase substantially over the next several years as power generators and other industrial end users work to comply with stricter air emission standards, and as production from the Central Appalachian coal basin continues to decline," Jeff Armstrong, president of Kinder Morgan's terminals group said in a statement.
Prospecting right granted to GVMs Holfontein coal project
GVM Metals Limited, the South African mineral processing and coal mining company, announced that Holfontein Investments (Pty) Ltd has been granted a prospecting right under section 17(1) of the Mineral and Petroleum Resources Development Act (28 of 2002) for its key coal mining asset, the Holfontein Project. GVM has a 49% joint venture interest in Holfontein Investments (Pty) Ltd.
The Holfontein Project consists of two mineable coal seams, the No 5 seam, which is a coking coal, and the No 4 Seam, which is a low-grade steam coal. GVMs December 2005 Scoping Study was based on a resource of 56 million tonnes and 22 million saleable tonnes. The Study indicates a project value of 16.6 million.
The Holfontein Project is located in the South African Witbank coal field, an established mining region responsible for the major proportion of South Africas past coal production. The site is located two hours from Johannesburg with good infrastructure including rail, road and electricity. GVM is developing the project with its joint venture BEE partner Motjoli Pty Ltd and funding and payment obligations for the project will be the joint responsibility of GVM and Motjoli.
