July, 14 2006
Chhattisgarh announces new mining policy based on value addition
It is reported that Chhattisgarh has put in place a new mining policy that would ensure value addition rather than mere export of raw material. Chattisgarh CM Dr Raman Singh told reporters This would be done either through coal based power generation or use of iron ore in state based units. Mr Singh said that the inspiration for the new policy is China, which does not export any of its high quality coal but uses it for generating power and creating value for the country. He said If China does not give us its good quality coal, why should we go in for a one sided agreement and agree to give them our rich iron ore? The centre will have to agree to this. We are talking in the interest of the nation and not just our state.
Under to the new mining policy Chhattisgarh has decided there would have to be a greater value addition by the mining companies including National Mineral Development Corp which holds lease for mines estimated to have 65% of the iron ore deposits in the state. Dr Singh said For the last 40 years, NMDC has been exporting raw iron ore and we have been getting just Rs.18-20 per tonne as royalty. Now we have decided that value addition has to be done in the state so that we get better revenue and the industry gets a boost.
Chhattisgarh Mining Development Corp has formed a JV with NMDC earlier this month for opening a new block in Bastar region that has 350 million tonnes of iron ore reserves. Dr Singh said The iron ore mined from this Block 13 would be processed and supplied to local industries. This could lead to more industries finalizing plans to set up operations in the state.
About 25% of Indias iron ore reserves are found in Chhattisgarh, mainly in the hilly pockets of Bastar region.
Revised rates for duty draw back announced
Indias ministry of finance has announced the revised All Industry Rates of Duty Drawback, which shall come into force with effect from 15.7.2006, vide a notification No.81/2006-Cus (NT) dated July 13, 2006. The Drawback Schedule includes 84 new items. The drawback rates have undergone significant changes in sympathy with the changes in prices of inputs, duties etc. The rates have been revised upwards on most products.
The ministry of finance had constituted a Committee to determine the drawback rates which held extensive consultations with the various industry and trade associations and other stake holders in various locations and submitted its Report on 15.6.2006. The Government has accepted the drawback rates as suggested by the Committee. The drawback rates have been determined on the basis of certain broad parameters including the prevailing prices of inputs, standard input/ output norms, share of imports in the total consumption of inputs and the applied rates of duty. The element of education cess has been factored in the drawback rates. A significant feature of the new Drawback Schedule is that the drawback rates now also take into account the incidence of service tax paid on taxable services which are used as input services in the manufacturing or processing of export goods.
The new drawback rates for semi finished steel, HR Coils, CR Sheets, GP Sheets and bars & rods are in the range of 2.7% to 3.7% (all customs) with drawback caps varying from Rs. 625/MT to Rs.1000/MT. In the case of stainless steel utensils, the rate has been revised upwards from 11% to 15% with varying caps depending upon the quality of utensils.
GPT achieves 90% prime production of tin plate in June
GPT Steel Industries has achieved more than 90% prime tin plate output in the month of June 2006 within months of starting commercial production and has also crossed the annual capacity of 180,000 tonnes of tin plate on shift to shift basis. The tin mill which has been relocated from Arcelors Cockerill Sambre facility in Flemalle in Belgium, has been turned into a state of the art mill with some major improvements.
GPT Steel Industries Limited is situated at Mithi Rohar Industrial Estate in Gandhidham of Kutch district in Gujarat state and has set up a 650,000 tonnes cold rolling and tin mill facility. The production of Cold Rolled products which includes the widest Cold Rolled product of the country at 1728 mm is expected within next month.
GPT Steel Industries has distinct advantage over other producers of tin plate in India due to its proximity to the market of tin plate which is largely concentrated in the western part of the country.
GPT Steel Industries is a part of GPT Group having interests in steel plants, steel pipes, service centers and power plants.
Mr Munda very optimistic on Mittal Steels plant in Jharkhand
Jharkhand CM Mr Arjun Munda is reported to be very optimistic about Mittal Steel setting up its project in Jharkhand even after Mr LN Mittals announcement of steel plant in Orissa. Mr Munda told media "The proposal of Mittal Steel is well on track in Jharkhand. Every bottleneck will be removed to facilitate the project."
Expressing confidence that the proposed 12 million tonne Greenfield project would come up in Jharkhand, Mr Munda said all the issues like displacement and mineral policies would be sorted out at the earliest so that the proposal would be through on time.
As per earlier reports Mr Munda is likely to visit London on his way back from US to attempt a patch up with Mr LN Mittal. It remains to be seen that how Mr Munda tackles the pivotal issue of Chiria iron ore mines, as they belong to SAIL and it is unlikely that court would rule in favor of state of Jharkhand.
Bangladesh finance minister clarifies that TATA's proposal not cancelled
Mr M Saifur Rahman finance and planning minister of Bangladesh clarified that TATAs investment proposal in Bangladesh has not been cancelled and no decision should be taken in haste as the country's general elections are ahead.
BSS news agency quoted him as saying that "It is a big investment proposal and we have to be more specific on many sides of the proposal and it has been postponed for the time being. We also want this investment. But election is ahead, we should not take a hasty decision during this period."
The finance minister said that TATA's proposal has been discussed, but there are still some matters which are unclear. He said it is difficult to take such a big economic decision during the election time. He said "TATA said that they would come when the government invites." He added that "there is scope for further discussion on this matter."
TATA had announced suspension of its planned $3 billion investment proposal on Monday.
Mitsui has 10% stake in Ruchis Indian Steel Corp at Kutch
Indore based Ruchi Group has revealed that Japanese Mitsui & Co has 10% equity stake in its CR & galvanizing project Indian Steel Corporation Limited at Gandhidham in Kutch region of Gujarat. Mr Arjun Jalani has told ET that This is the first equity investment by Mitsui in an Indian Steel company.
Indian Steel Corporation Limited has already commissioned a cold rolling mill of 200,000 tonnes capacity and 120,000 tonnes capacity galvanizing line in the first phase of the project. It plans to double the CR capacity to 400,000 tonnes and coated products capacity to 270,000 tonnes in the 2nd phase, which is likely to be completed sometime next year.
Adhunik Metaliks to takeover Unistar Galvanisers
Kolkata based Adhunik Groups Adhunik Metaliks is reported to be taking over Unistar Galvanisers and Fabricators for an undisclosed sum.
Unistar Galvanisers based in 24 Parganas of West Bengal will be merged with Neepaz Tubes, one of the Adhunik Group companies. The merged entity will be a subsidiary of Adhunik Metaliks, which produces auto grade and stainless steel.
The acquisition is expected to further expand the Adhuniks portfolio of finished steel products. A senior official of the group told media that As Unistar produces value added products the acquisition will help in the forward integration of the company.
Chhattisgarh approves thermal power plant for Delhi
Chhattisgarh has given the Delhi government its consent for 2,000MW coal based thermal power plant in the state f Chattisgarh and aimed to bring relief to power starved Delhi. Chhattisgarh CM Dr Raman Singh told Delhis Power Minister Mr Harun Yusuf to go fast for the power plant as the Chhattisgarh government wants to see the project sail through at the earliest.
The power plant is likely to come up in Janjgir district of Chattisgarh and will be built at an estimated cost of Rs.100 billion.
It is reported that Delhi government wanted to complete the project within 32 months. The first phase of the project would be of 1,000 MW.
Phelps Dodge gets US clearance for Inco & Falconbridge buy
Phelps Dodge Corp has announced that it has received antitrust clearance from the US Department of Justice and the Federal Trade Commission for its purchase of Inco Ltd and Falconbridge Ltd.
Phelps Dodge is yet to get the green light from regulators in Europe and Canada.
The shareholders of all the companies are also to accord approval of this transaction.
Phelps has competition for Inco and Falconbridge in the guise of, respectively, Teck Cominco Ltd and Xstrata plc. However the board of Falconbridge said they remain committed to the friendly takeover by Inco and subsequently the friendly takeover of a combined Inco Falconbridge by Phelps Dodge.
China drafting criteria for iron ore importers to cut traders out
Chinese media has reported that China Iron and Steel Association and its 58 member steel companies met in Zhengzhou City in Henan Province on July 6 to discuss preparations for the 2007 iron ore benchmark price negotiations such as tightening the iron ore import licensing qualifications in order to cut importer numbers and regulate the sector. It is reported that the Chinese government wants to tighten the control on the iron ore trading sector because upstream suppliers are making too much money and negatively impacting downstream users.
CISA is reported to have suggested that the trading company should be allowed only to act as agents for steelmakers in future and charge an agent fee only. In this scenario the margins for agents will be much lower than what trading companies are doing now, which is importing iron ore and redistributing to steelmakers, especially to the ones that do not have import licenses. But as per industry sources the redistribution premium is huge and few trading companies would like to give it up.
The report indicated that Chinese government plans to cut the total number of iron importer which currently stands at 118 iron and constitutes of 70 steelmakers and 48 are trading companies. The meeting discussed the draft of the 2006 iron ore importer qualifications and iron ore import contract registration management methods. The draft suggests that the qualified steelmakers and trading companies must have export volumes above 700,000 tons in 2005, which is 400,000 tons higher than current standard. The standard would not significantly impact the already qualified steelmakers but could wipe out most trading companies leaving a few such as China Minmetals and Sinosteel. Some trading companies have proposed a compromise that would combine the trading companies of import volume between 300,000 tons to 700,000 tons for one import license.
The final decision is up to the China Chamber of Commerce of Metals Minerals & Chemicals Importers and Exporters.
Nippon Steel to seek more output in future
Mr Akio Mimura president of Nippon Steel said that the effort to improve the corporate value is not enough to keep the stake holders' value when Mittal Steel and Arcelor to merge becoming mega scale maker with annual 120 million tonnes of raw steel output.
Mr Mimura said that Nippon Steel keeps trying to focus on high valued steel products as no.1 supplier in total power. However, he said the volume is also important and the firm tries to increase the output to more than 40 million tonnes.
Kenwal Steel to put steel processing facility near SeverCorr
SeverCorr announced that Kenwal Steel Corporation has agreed to build a downstream processing and distribution facility next to the under construction plant of SeverCorr near Columbus in Mississippi. The new facility will feature state of the art, surface critical slitting and packaging systems with a broad range of coil to coil processing capabilities. The facility is scheduled to become operational in the late spring of 2007.
Kenwals service capabilities will include a light gauge slitting system that will focus on cold rolled and coated materials from 0.010 to 0.060 thick as well as HRP&O from 0.055 to 0.100 thick in widths up to 72 inches, a heavy gauge slitter that will run largely unexposed materials such as HRB and HRP&O from 0.070 to 0.375 thick in widths up to 72 inches and an automated packaging line to accommodate specific customer needs on all slit coil requirements.
Mr Michael Wagner chief commercial officer of SeverCorr said When we decided to build a next generation steel mill, we also decided to create next generation relationships with the downstream channel. So we selected a site with room for partners to build processing and distribution facilities. We are pleased to welcome Kenwal as one of our first neighbors.
Mr Kenneth Eisenberg Chairman and CEO of Kenwal said We are already serving customers in the South and SeverCorrs announcement made this an opportunity that was just too good to miss. SeverCorrs commitment to building a tightly-integrated working relationship with their mill operations will provide a new level of service to our steel customers.
Kenwal Steel Corp. will celebrate its 60th year in business in 2007, and
Kenwal, based in Dearborn in Michigan is a full service steel processing company that provides a wide range of flat rolled steel products and services to various industries, including automotive, electronics, appliance, tubing, major equipment manufacturers, and other steel related businesses.
SeverCorr was formed in 2003 to build a state of the art steel facility to service growing manufacturing opportunities in the Southern US. In October of 2005, SeverCorr broke ground on a next generation steel mill near Columbus, Mississippi. When complete in mid 2007, the plant will produce 1.5 million tons of high quality steels a year for use in the automotive, building, agricultural, pipe & tube, and appliance industries.
Tender status of Mittal Steel's offer for Arcelor as of July 12
As per Luxembourg law, Mittal Steel has informed the market that, to its knowledge, as of July 12, 2006, one day prior the closing of the offer, after closing of the markets in Europe, 109,306,317 Arcelor shares and 4,744,432 Arcelor convertible bonds have been tendered in its offer for such securities. The number of Arcelor shares tendered in the offer represents 17.63% of the voting rights of Arcelor.
Mittal Steel informed the market that, since the tender offer procedure is centralized, definitive information relating to the number of Arcelor securities tendered in the offer will be known only after the closing of the offer after the centralization procedures have been completed. As a consequence, the figures set forth above cannot be relied upon as an accurate representation of the number of Arcelor securities actually tendered in the offer, nor as an indication of the possible result of the offer.
As from today, Mittal Steel will stop issuing daily reports on the tenders in the Offer. As from July 14, all tenders in the Offer will be centralized in each jurisdiction of Belgium, France, Luxembourg, Spain and US where the Offer has been made and then by Societe Generale, acting as global centralizing agent for the offer. Once all of the tender information relating to the Offer has been centralized by the global centralizing agent, the latter will verify the tender information, count the tendered Arcelor securities, complete the pro ration procedure among each of the secondary cash and exchange offers as described in the offer prospectus, as supplemented, and calculate the aggregate results of the offer, broken down by type of offer. This centralization and calculation phase will take up to nine business days, as set forth in the Offer prospectus, as supplemented. The final results of the offer will be published on July 26, 2006.
While in the process of verifying and counting the Arcelor securities tendered in the offer, once the global centralizing agent has determined that, on a preliminary basis, the minimum tender condition of the offer that 50% of Arcelor outstanding shares on a fully diluted basis as set forth in the Offer prospectus, as supplemented is met, Mittal Steel will issue a press release to inform the market to that effect.
As at the date hereof, Mittal Steel holds no Arcelor shares and no Arcelor convertible bonds.
Thermal coal producers likely to get good price this year
Goldman Sachs JBWere analysts said in a research note that thermal coal producers are likely to achieve a good outcome when contract prices are finally settled.
They said that recent contract settlements between Xstrata Plc and Japanese utilities at $52.5 per metric ton for the current fiscal year to March 31 were only slightly below the 2005-06 contract price range of $52 to $54 per ton. The Goldman Sachs analysts noted the outcome was well above buyers' expectations at the start of the negotiation process. Goldman Sachs said the Xstrata settlement should set the benchmark for the other Australian thermal coal suppliers.
The analysts said they have raised thermal coal price assumptions for the Japanese 2008 and 2009 fiscal years by about 10% after a detailed review of Pacific Basin thermal coal market dynamics. They said "We remain bullish on the demand outlook rapid growth in coal fired electricity generation throughout Asia has potential to lift regional demand for imported coal by at least 20 million tons per year for the next three years. However, in our opinion, supply of thermal coal is relatively unconstrained, in comparison with base metals, and we envisage strong growth in export availability over the next few years."
Oregon Steel to start 2 spiral pipe plants soon
Oregon Steel Mills Inc is planning to open two new spiral weld pipe mills in at company's Portland Steelworks facility in Portland in July and August. Oregon Steel Mills' existing mill will feed the company's new pipe plants.
Oregon Steel Mills and the Port of Portland on Wednesday signed an agreement which will allow the company to grow their steel slab import volumes from 800,000 tons annually to an expected 1 million tons in 2007. The agreement provides preferential use of one berth and 17 acres at the port's waterfront Terminal 6 for 10 years with a 5 year extension option. Oregon Steel Mills already uses one berth and nine acres at Terminal 6.
Oregon Steel Mills has rolling mills for making HR Coils and plates in Portland.
4 killed in Caojiashan Coal Mine flooding in China
Rescuers have recovered the bodies of four miners who were trapped in a flooded coal mine on Saturday night in north China's Shanxi Province and were searching for two other missing miners.
The flooding in the Caojiashan Coal Mine in Liulin County occurred at around 9:30PM on Saturday when 47 miners were working underground. 41 miners escaped but 6 were trapped, according to the Liulin County government.
Rescuers are pumping floodwater out of the flooded shaft with four pumps. Initial investigations show that floodwater might come from a mined out area.
The Caojiashan Coal Mine, a village run coal mine, produces 60,000 tons of coal per year.
NLMK increase steel production by 21.4% in Q2 of 2006
According to preliminary data Russian steel major Novolipetsk Integrated Iron and Steel Works OJSC produced 2.3 million tons of steel in the second quarter of 2006 recording an increase of 21.4% YOY over 1.895 million tons in the Q2 of 2005.
NLMKs production of hot metal grew by 21% to 2.322 million tons from 1.919 million tons, slabs production increased by 68.2% to 0.977 million tons from 0.581 million tons. The production of hot rolling mill products reduced slid by 33.9% to 0.355 million tons while the production of cold rolling mill products increased by 19.8% to 0.641 million tons from 0.535 million tons.
NLMK ranks third among Russian iron and steel works and specializes in the production of flat products of wide range. NLMK produced 8.47 million tonnes of steel in 2005.
Daewoo Shipyard to setup ship block building facility in China
World's 2nd largest shipyard South Korean Daewoo Shipbuilding & Marine Engineering Co announced that it will start building a factory in China next week to produce blocks for ships at an investment of $100 million. The facility is scheduled for completion next year.
The plant, located in the Chinese northeastern port city of Yantai in Shandong Province, is projected to have an annual production capacity of 50,000 tons of ship blocks or steel structures comprising hulls. The company plans to increase the factory's annual capacity to 200,000 tons in the long term.
Daewoo's wholly owned subsidiary in China, DSME Shandong Co, will be in charge of managing the new factory.
Inco extends offer for Falconbridge to July 24
Inco has extended its offer for rival Canadian nickel producer Falconbridge to midnight of July 24. In a statement, Inco said that while it had received a growing number of acceptances from Falconbridge shareholders in the last week, it did not expect the minimum tender condition to be satisfied prior to the expiry of the existing offer on July 13.
The move was widely anticipated and is expected to be followed in the next few days by a revised offer from both Phelps Dodge and Inco to acquire Falconbridge in a way deal.
The extension also follows an extension and a revised hostile offer for Falconbridge made by Swiss mining group Xstrata earlier this week.
Inco wants to buy Falconbridge in a friendly acquisition and allow it to be acquired in a friendly deal by US copper miner Phelps Dodge. At the same time, Swiss mining group Xstrata is also bidding for Falconbridge, while Teck Cominco is pursuing Inco in a hostile bid on condition of it not acquiring Falconbridge.
Zambia to get its first steel plant
A consortium of Zambian businesses Universal Mining and Chemical Industries Ltd has started construction of a $120 million steel plant in Kafue 45 kilometers south of Lusaka. UMCI would start producing steel in September 2007 and aimed to hit 100,000 tonnes output the following year and as much as 200,000 tonnes within six years. It will be Zambia's first steel production plant.
Mr Julius Kaoma technical director of UMCI said "UMCI is investing $120 million of locally generated funds into this venture. We will spend $60 million in the first phase and $40 million would be spent on upgrades and expansions in the second phase while the balance would be spent on follow up expansions and to open a coal mine to provide raw materials to UMCI.
Mr Kaoma said UMCI would produce steel from scrap metal in 2007 and then start to use iron ore deposits at its mine at Sanje Hills west of Lusaka. He said "As production increases, we will start the processing and conversion of iron oxide ore into sponge iron to replace scrap feed stock in phase two.
Mr Kaoma said that a ferro alloy plant would be built in the last phase with a coal mine in southern Zambia to use for heating and enhancing the carbon content of steel. He said "We will begin to produce high grade stainless steel for the local market and exports in the last phase."
EU clears proposed acquisition of Falconbridge by Xstrata
The European Commission has cleared under the EU Merger Regulation the proposed acquisition of the Canadian company Falconbridge Limited by the Swiss group Xstrata plc subject to conditions on 4th July 2006. After examining the operation, the Commission concluded that the transaction would not significantly impede effective competition in the EEA or any substantial part of it.
Xstrata, which already owned 19.8% of Falconbridge's issued share capital, launched on 17 May 2006 a public bid to acquire all of the outstanding common shares of Falconbridge. The Commissions examination of the proposed deal showed that the overlaps between the mining, processing and sales activities of Falconbridge, Xstrata and Glencore would be limited and that, for all products concerned, the combined firm would continue to face several strong and effective competitors.
Falconbridge is a diversified mining company active in the mining, processing, refining and sale of various metals, including nickel, copper, cobalt, lead, zinc, aluminium and precious metals. Falconbridge is also subject to a competing bid by Inco Limited, a Canadian mining company.
Xstrata is a natural resources group, mainly active in mining, smelting, processing and sale of coal, copper, zinc and alloys with additional exposures to gold, lead and silver. Xstrata is controlled by Glencore, a diversified natural resources trading company also based in Switzerland, active in metals and minerals like aluminium, zinc, copper, ferroalloys & nickel, energy products like oil products & coal and agricultural products.
Mittal Steel Ostava offers golden handshake to cut 1,000 jobs
It is reported that Mittal Steel Ostrava plans to eliminate about 1,000 workers to boost productivity closer to western European norms. Mittal Steel Ostrava's personnel director said The company still doesn't reach the productivity of western companies and not even the European average We want to and need to reach a higher effectiveness.''
A company spokeswoman said that employees who agree to leave will receive a severance payment equal to between 12 and 32 months of their average salary. To be eligible for the money, Mittal workers have to ask to leave between July 17 and August 4, with the condition that their contract would expire by August 31.
Mittal Steel Ostrava made a similar offer in 2004, when 1,729 employees took up the offer and left the company.
Mittal Steel Ostrava is the biggest Czech steelmaker and currently employs 8,860 people. Its profit in the year to February 28 dipped by 45% to 4.6 billion koruna ($205 million) as demand and prices declined and because of accounting changes.
The company is offering the same for employees of its unit Vysoke Pece Ostava which will merge with Mittal Steel Ostrava this year. Vysoke Pece employs 960 at the moment.
Azovstal undertakes 10 projects in 2006 to reduce costs
It is reported that Ukrainian Azovstal Steel plant will implement over 10 energy saving projects in 2006 to reduce energy consumption by 2.6% and natural gas consumption by 0.9%. Natural gas and electricity constitute 10% to 15% in the cost structure of steel making and therefore these measures should result in about 0.5% margin improvement other things being equal.
The energy saving projects includes a new system of metering electricity consumption which should result in reduction of consumed electricity of up to 2% and a new oxygen block costing $67 million for reducing electricity consumption by 10% per cubic meter of produced oxygen.
The other initiatives include a new system of metering costing $2 million for reducing natural gas consumption by 36 million cubic meters per year. Additional saving of natural gas which will come after installation of the system that utilizes coke oven gas which should reduce Azovstals natural gas consumption by another 23 million cubic meters per year.
Other programs include installation of the water consumption metering equipment etc.
Eskom to consume 114 million tonnes of thermal coal this year
South African power utility Eskom Holdings Ltd, which claims to be the world's biggest coal buyer, may use as much as 114 million tons of coal in the 12 months ending March 2007 as against 112 million tons burnt in the previous period.
Eskom, based in Johannesburg, produces more than half of Africa's power, mainly from coal fired power plants. It buys coal from companies including Anglo American Plc and BHP Billiton
CVRDs MBR to start 7 million tonne pellet plant in early 2008
BNamericas has reported that CVRDs MBR plans to finish construction of a 7 million tonnes per annum iron ore pellet plant under its $760 million Itabiritos project in the first half of 2008. An MBR press official told "The setup of metallic structures in the pellet plant will start in October marking the start of construction.
MBR is also expecting to receive the permissions for the project's 10 million tonne per year iron ore concentration plant at end of August this year and plans to start work in September.
SA Rhovan planning expansion of vanadium operations
Xstrata owned South African vanadium producer Rhovan is reported to be finalizing an expansion to raise its overall output by 9 million pounds to around 30 million pounds a year. It is reported that the proposal has been submitted to the Department of Environmental Affairs and Tourism for a record of decision and that it should be submitted for board sanction during October.
Rhovan produces vanadium pentoxide and ferrovanadium from a vertically-integrated production facility located near Rustenburg. It produced the equivalent of 22 million pounds of vanadium pentoxide last year, making it arguably the fourth largest producer globally.
China's spot price of iron ore declines
China Securities Journal citied China's Ministry of Commerce as saying that the iron ore market is comparatively slack as most domestic manufacturers have sufficient iron ore stocks in hand. As per reports spot price of iron ore in China fell 4.53% or 29 yuan per ton in June compared with that of last December.
It said that the spot price of iron ore is greatly affected by the increase of domestic output of iron ore. China's output of iron ore reached 191 million tons during January to May 2006 an increase of 31.5% over the same period of last year.
Another reason for dip in stock prices cited is the huge stocks at major ports. As per reports stockpiles of iron ore at major docks hit 43.6 million tons by June 16th
Experts predict that the spot prices of iron ore will continue to decline in the second half of the year as the demand for steel is also expected to decline due to the government's macro control measures.
OMKs Chusovoy gets $35 million credit from Metallinvestbank.
United Metallurgic Company OMKs Chusovoy Steel Works has approved a credit line for $35 million from AKB Metallinvestbank. The credit interest rate will be maximum 20% per annum. The credit payment date is December 31, 2009. ChMZ' property will become security for the credit.
ChMZ produced 64,000 tons of auto springs, 410,000 tons of finished steel, 518,000 tons of steel in 2005 and sales proceeds totaled more than RUB 12 billion.
OMK is one of Russia's largest manufacturers of pipes, railway wheels and other metal products for power, transport and production companies.
Luxembourg foreign minister for relation with Russians despite Severstal breakup
It is reported that Arcelor is maintaining contact with Severstal despite breaking its deal to merge with Mittal Steel. Mr Jean Asselborn foreign minister of Luxembourg said "As far as I know, contacts and ties are being kept up. Hope that they will find common interests in the economic sphere."
Mr Asselborn refusing to elaborate on the details said "This is very interesting for us, we want to cooperate with the Russian side."
Universal Stainless increases tool steel base price
Universal Stainless & Alloy Products Inc announced a 4% base price increase on all tool steel plate products. According to the company, the price increase will be effective on shipments scheduled on or after July 24, 2006.
Mr Mac McAninch president and CEO said "This price increase is necessary to help offset the rising costs of electricity and our manufacturing supply costs, while enabling us to continue our reinvestment in equipment and facilities to better serve the needs of our customers."
Metalloinvest increases iron ore pellet prices
Russian Metalloinvest controlled Mikhailovskiy and Lebenskiy Ore Minining and Enrichment Plants announced an increase in pallet prices by 25-30%. Metalloinvest sold pellets for $50 per tonne in Q2 of 2006 and now the price will rise to $62 per tonne.
This announcement is likely to help Ukraines SCM group which controls Severniy OMEP and Tsentralniy OMEP) as higher price for Russian made pellets will increase their bargaining power in negotiations with domestic steel producers.
