October, 25 2006
SAIL to remain market leader in India
On the backdrop of mergers in the global steel industry and flurry of announcements made by domestic as well as foreign players for setting up steel plants in India, India's largest steel maker Steel Authority of India Limited is confident of retaining its leading position in Indian domestic market.
Mr SK Roongta chairman of SAIL told PTI "Let anybody come. We shall maintain or consolidate our market share. We have a very strong client base. Despite new producers in the 90's we have been able to hold on to ourselves.
Mr Roongta said that "There is enough potential in the domestic market to grow but we shall not close our eyes to good opportunities even overseas.
SAIL has set a target of producing 22 million tonnes of steel in the next 5 years and subsequently increase it to 40 million tonnes by raising the capacity of Bokaro Steel Plant, Durgapur Steel Plant, Rourkela Steel Plant, and IISCO Steel Plant to 14 million tonnes, 5 million tonnes, 5 million tonnes and 5 million tonnes respectively.
Jharkhands new government to review land lease to TATA Steel
It is reported that the new Jharkhand government is considering a review of the renewal of lease deed for TATA Steels Jamshedpur based steel plant, signed last year by previous government led by Mr Arjun Munda.
Mr Dulal Bhuiya minister for land and revenue said The departmental secretary has been asked to review the renewal of lease agreement which took place last year. The officials have been asked to review the minutest detail of the lease and prepare a report of it. He added that the review would also include the revenue aspect. He said It would scrutinize whether the government was set to lose any revenue after renewal of the lease.
TATA Steel had set up the steel plant at Jamshedpur in 1907 and the lease for the land is renewed every 30 years. The extension of lease was pending since 1996, when Jamshedpur was part of Bihar and Mr Arjun Munda led National Democratic Alliance government renewed the lease in August. While renewing the lease last year, TATA Steel had agreed to pay Rs.1.5 billion for a mega sports complex and Rs.250 million every year till 30 years for the state's health sector to improve the condition of below poverty line people.
ISA opposing allocation of iron ore mines within producing states
It is reported that the Indian Steel Alliance is opposing the Hooda Committee recommendation for preferential allocation for captive mining for steel companies within the state their factories are located as it will effect some of ISAs member steel companies including JSW, Essar Steel, Ispat Industries and Rashtriya Ispat Nigam Limited.
Mr Moosa Raza president of ISA said "We have opposed the concept of value-addition within the state. We are against the principle, which would lead to fragmentation based on a region or state concept. As far as the issue of steel capacity is concerned for the allocation of iron ore reserves, our view is that it should also take into account steel companies committed capacity expansion plan.
Hooda committee had in its report suggested such a measure for captive mining of iron ore. The report said that the steel making capacities already in existence on July 1st 2006, which do not have captive mines, may also be given preferential allotment of adequate iron ore reserves within the state without the need to go through the process of auction as a one time measure to provide a level playing field.
Steel steering committee to drive Indian steel sector
Business Line has reported that the Indias ministry of steel will be setting up a steering committee, comprising of major steel manufacturers, secondary steel produces' associations and steel ministry officials, for looking into the issues related to import and export of steel, development of domestic market, demand assessment for steel and the overall implementation of the National Steel Policy.
As per reports after the steering committee is in place, the task of assessment of future steel demand is likely to be outsourced. The steering committee would also be taking a view on a proposal for compulsory ISI certification in all steel products and would also be looking into the issues of export and import and related duty structures and incentives.
Orissa cancels MoU with ASIL
It is reported that Orissa government has cancelled the MoU with Agrim Steel Industries Ltd for setting up a steel plant as there has been no progress in the project work.
With this move, Orissa government has cancelled MoUs with Sunflag Specials Steel Ltd, AML Steels and Power Ltd and Stats Steel India (Pvt) Ltd and Agrim Steel Industries Ltd.
The State Government has also sent showcase notices to five other companies for not progressing with their project work.
MSPL eying iron ore mining in Jharkhand
In addition to its plans for achieving 10 million tonne of iron ore capacity at Hosepet region over the next two to three, Indian iron ore major MSPL is reported to be eying opportunities in the mineral rich state of Jharkhand after joining Haridaspur Paradip iron ore transporting SPV.
Mr Shrenik Baldota ED of MSPL told ET that Globally we believe that there are enormous opportunities for mining iron ore. Typically, global mining majors eye for annual capacities in excess of 20 million tonnes but we are steering clear of this segment.
Mr Baldota said that MSPL is also scouting for buyout opportunities abroad and is also reportedly eyeing mining opportunities in precious metals like gold and diamonds. It plans to invest over Rs 100 crore in developing mines in and around Gadag in Karnataka for gold and for mining diamonds in Andhra Pradesh.
LNJ Bhilwara consolidating presence in power generation
The LNJ Bhilwara Group announced incorporation of Bhilwara Energy Ltd as groups flagship entity in the power sector and plans to invest Rs 7,000 crore in power sector in 5 to 7 years. BEL will focus on diversifying the groups portfolio into the power business. Its now planning to enter power transmission, distribution, trading and generation from non-hydro sources like thermal heat, wind power and nuclear energy.
Bhilwara Energy Limited will be the holding company of the groups existing power generation companies Malana Power Company Limited and its subsidiary AD Hydro Power Ltd. Apart from being a holding company for all our power ventures, BEL will focus on smaller or less than 100 MW projects and let MPCL target large power projects
The company proposes to hold majority equity stake of 51% in MPCL. Further, by acquiring 51% equity stake in MPCL, the company would also acquire 45.9% holding of ADHPL indirectly, since MPCL holds 90% stake in ADHPL.
Mr Ravi Jhunjhunwala chairman said "The Group is determined to expand its power generation capacity continuously. The envisioned power generation capacity of the group is 1,500 MW by 2012.
The LNJ Bhilwara Group is a Rs 2,400 crore conglomerate with presence in textiles, graphite electrodes, steel, ITES, power generation and power consultancy.
GAILs DVPL project bags IPMAs silver medal
The International Project Management Association during its 20th IPMA World Congress held recently in Shanghai has awarded the silver medal in the mega projects category to Indias GAIL (India) Ltd's Dahej-Vijaipur Pipeline project.
Dahej-Vijaipur Pipeline project is Indias largest cross country pipeline project for transportation of high pressure gas and it passes through Gujarat and Madhya Pradesh. The project comprises of 610 kilometers of trunk pipeline of 42" diameter and has a throughput capacity of 23 MMSCMD, which can be upgraded to 45 MMSCMD with the installation of intermediate compressor stations at Jhabua and Vijaipur.
Everest Kanto to invest more in UAE operations
Everest Kanto Cylinder Ltd has informed BSE that its board of directors at a meeting held on October 20, 2006 approved the enhancing the investment of the Company in EKC International FZE, wholly owned subsidiary in UAE by way of equity / loan by further up to $ 5 million.
CVRD takes over Inco, extends offer and to delist it from NYSE & TSE
Companhia Vale do Rio Doce announced that it has acquired 75.7% of Inco Ltd's shares thus taking control of the Canadian nickel giant to become one of the world's three biggest diversified miners with a leading position in nickel, iron ore, bauxite, alumina and manganese.
CVRD also said that it has extended its all cash offer of C$86 a share until November 3rd to give it more time to obtain the remaining shares and will take steps to acquire them. CVRD said In line with the objective of acquiring 100% of Inco's traded shares, Vale intends to take measures to acquire Inco's remaining ordinary shares in the market.
The company plans to delist Inco shares from the New York and Toronto stock exchanges promptly. CVRD said that it will seek to reconstitute the Inco board of directors and delist the shares from the New York Stock Exchange and as soon as possible from the Toronto Stock Exchange. Once it has acquired sufficient shares, CVRD will drop Inco stock from markets, dissolve its board and seek to have the company begin reporting as a foreign private issuer under the US securities law.
China to see coal overcapacity of 400million tons by 2010
Chinese domestic demand for energy resources has remarkably increased from 2001, especially for coal, thus bringing huge investment in coal sector resulting in jump of over 40% between 2003 and 2005 despite Chinese governments efforts to cool it down specially to fend off rising accidents in coal sector
Total coal capacity still climbs by 240 million tones and the fresh capacity is foreseen to add another 60 million tones, thus taking the total capacity to 2.45 billion tonnes in 2006. It is forecast that domestic demand for coal in 2006 is about 2.17 billion tones and with coal exports of 80 million tones leaves an apparent demand of about 2.25 billion tones resulting in overcapacity of about 150 million tons to 200 million tones.
According to national economic situation, the coal demand is expected to level off in a couple of years, stabilizing at 2.4 billon tones or so. With the undergoing constructions, China's total capacity is estimated to reach 2.86 billion tones by 2010. The potential overcapacity might reach more than 400 million tones.
Small sized coal mines account for too large proportion nowadays. Before 2004 state rectification, China's 23,000 small sized coalmines, accounting for 88.9% of total coal mines, face questions like obsolete technology and management, high energy consumption, serious environmental pollution and lack of safety equipments.
(Sourced from Mysteel.net)
Lone Star forms OCTG JV with Brazilian GPC
Lone Star Technologies Inc announced that it has entered into a definitive agreement to form a JV with Brazil based holding company Grupo Peixoto de Castro.
Under the agreement, Lone Star will acquire a 50% ownership stake in Apolo Mecanica e Estruturas LTDA, an oilfield tubular products facility in southeastern Brazil that is operated by Apolo, for approximately $42 million. The remaining 50% ownership stake will be held by GPC and profits from the JV will be shared equally between the two partners.
The JV will have its own board of directors initially consisting of six directors. GPC and Lone Star will each be entitled to nominate half of the total number of directors. Management is expected to consist primarily of current managers of Apolo Tubulars.
Apolo Tubulars' domestic production assets currently include a new ERW pipe mill and related finishing facilities capable of producing approximately 150,000 tons of oilfield tubular products ranging from 2 3/8" to 9 5/8".
Mr Rhys J Best chairman and CEO of Lone Star said "We are very pleased with this opportunity to enhance our existing relationship with GPC through this Joint Venture, as we both share the same vision of offering customers best in class products and solutions. Our strategic investment in Apolo Tubulars will give us the opportunity to benefit from the strong growth in demand for oilfield tubular products that is anticipated to occur in many South American countries. Together, we can offer our customers practical commercial solutions utilizing profitable, efficient and safe manufacturing as well as state of the art supply chain management."
Grupo Peixoto de Castro is a Brazilian holding company whose principal operating subsidiaries manufacture and distribute refined petroleum derived products, lubricants, chemicals and petrochemicals, steel tubular products and refractory materials. The Group is also active in the banking and real estate industries.
Lone Star Technologies Inc is a holding company whose principal operating subsidiaries manufacture and market oilfield casing, tubing, and line pipe, specialty tubing products, including finned tubes used in a variety of heat recovery applications and flat rolled steel and other tubular products and services.
Ms Cynthia Carroll appointed as new CEO of Anglo American
The world's third-largest miner Anglo American Plc has appointed Ms Cynthia Carroll, currently CEO of Alcan Inc's Primary Metal Group, to take the helm of the restructured company from March 2007. Ms Carroll would join the board in mid January and take over as CEO on March 1.
Ms Carroll succeeds Mr Tony Trahar who is stepping down next year after 33 years with the company. His departure marks the completion of a restructure, which has seen Anglo sell off its steel and paper businesses to focus on core mining units.
An Anglo spokeswoman said Ms Carroll was the first outsider appointed as CEO since Mr Ernest Oppenheimer founded Anglo American Corp in 1917. Anglo American Corp of South Africa merged with Minorco in 1999 to create Anglo American Plc.
Mr Mark Moody Stuart chairman of Anglo American said in a statement "Cynthia Carroll has a very strong track record of improving operational performance, transforming culture, including improving safety performance, and of integrating and realizing synergies from newly acquired assets.
Baosteel, Tangshan and Wuhan set to increase capacity
Despite the concerns of over capacity in steel making in China, the 3 top Chinese steel makers are planning to increase their steel making capacity.
Largest steel maker Baosteel expects to nearly double its crude steel production to 50 million tonnes a year by 2012. Mr Zhang Dianbo GM of the No1 raw materials department at Baoshan Iron and Steel Co Ltd during a speech said that Baosteel plans to achieve its crude steel production of over 30 million tonnes and stainless steel production of 1.85 million tonnes before 2010.
Mr Chu Jiandong VP of Tangshan said that the group's capacity would reach 30 million tonnes in 2010.
Mr Sun Wendong head of Wuhan's trading department also said that it plans to raise its total capacity to 30 million tonnes by 2010 including through a yet to be approved project in the southern region of Guangxi. Mr Sun said that Wuhan's production capacity in Hubei province should reach 21 million tonnes by 2010.
Data provided by China Metallurgical Newsletter showed Baosteel was the country's top crude steel producer last year, with an output of 22.73 million tonnes, Tangshan was No 2 with 16.08 million and Wuhan No 3 with 13.04 million tonnes.
Lindsay reduces stake in Kloeckner
Kloeckner & Co announced that its major shareholder Lindsay Goldberg & Bessemer has cut its stake from 65% to 45% in a deal banking sources said was worth about 211 million euros ($264.7 million).
The US based private equity investor sold around 9 million shares on Tuesday or around 20% of Kloeckner's listed stock for 23.50 euros each, said one of the sources familiar with the deal. The stock went mainly to institutional investors in Germany, Britain and the United States. Dealers said banks UBS, Deutsche Bank and JPMorgan handled the sale.
Kloeckner welcomed the sale, saying it would boost its free floatfrom 35% to 55% and increase its prospects for promotion to Germany's mid cap MDAX index. The key criteria for index membership are the value of the freely tradable stock and its trading volumes.
Dr Thomas Ludwig chairman of the board of management said "We welcome this substantial increase of our free float; this makes us an interesting candidate for admission into the MDAX of the Frankfurt Stock Exchange."
Klkner & Co is the largest producer independent steel and metal distributor in the European and North American markets combined.
US asks China to scrap subsidies & cut production in steel
According to source with China's Ministry of Commerce, Assistant US Trade Representative Mr Tim Stratford and Undersecretary for International Trade Mr Frank Lavin paid an official visit to China during October 19th to 20th, when they met with Chinese government officials over Sino-US trade relations. The bilateral talks were reportedly centered upon such trading topics as Sino-US steel dialogue and WTO-related issues.
At the Sino-US steel dialogue, the US side urged its Chinese counterpart to dismantle subsidies granted to the latter's steel industry and cut its swelling steel production. The US side also threatened to bring the subsidy case against China to the WTO.
The US delegation claimed that some of China's existing subsidies run against the nation's earlier promises made when applying for entry into the WTO. However, the Chinese side refused to concede, arguing that the subsidies it grants do not fall under the category of prohibited subsidies.
(Sourced from Mysteel.net)
China's iron ore import growth to slow down in 2006
Xinhua has reported that for the first time since 2003 that the iron ore import growth rate has dipped under the 30% during September 2006.
Mr Lu Jianhua director of the ministry of commerce's foreign trade department said that China imported 247 million tons of iron ore in the first three quarters up by 24.2% YoY. Mr Lu predicted that total iron ore imports for the year would be around 320 million tons. Import growth for the year is expected to be 12 percentage points lower than last year.
Mr Lu attributed the slowdown in imports to China's rising domestic supply. He said that the growing domestic supply has helped drive down the average cost of imports by 7.2% to $62.70 dollars.
Mr Lu opined that "A new oversupply situation is brewing. Iron ore prices are going to slip back. Price hikes for four consecutive years have been a windfall for mine owners. However, iron ore consumers such as steel mills had to struggle with razor-thin profitability margins and the risk of losing money.
Mr Lu said that the world's major suppliers and consumers should all take a long term approach and establish a stable and healthy cooperative relationship in price negotiations. He said "We hopes all parties will team up with Chinese enterprises to secure rational and reasonable raw material prices, safeguard a fair global trade order and achieve common prosperity.
US states pitching to bring home ThyssenKrupps plant home
It is reported that officials from Louisiana state economic development are traveling to Germany to make a pitch to ThyssenKrupp Steel, which wants to build a $3 billion steel plant in the southern United States, to choose St James Parish as the location.
Other states are also likely to make competing sales pitches to ThyssenKrupp, which is in talks with officials about three possible locations for the project and will host state delegations representing all the sites at the company's base at Duisburg in Germany.
Mr Erwin Schneider a public relations official for the steel subsidiary of ThyssenKrupp AG however said "There is no timeline for the decision of a final location. He declined to identify the state delegations or reveal details of the negotiations, but the company previously said Louisiana, Arkansas and Alabama were in the running.
Louisiana Secretary of Economic Development Michael Olivier is leading Louisiana's group. Gov. Kathleen Blanco will be attending an economic development mission to New York this week and is not scheduled to participate in the Germany trip.
Mechel Targoviste to get a new caster
Russian Mechels Romanian subsidiary Mechel Targoviste AG has placed an order with Concast, Switzerland to build a continuous caster. Commissioning is scheduled for March 2007.
With its 3 strands, the caster will guarantee an annual production of 500,000 tonnes. The section sizes cast will be 140 x 140 mm and 150 x 180 mm.
The new caster will be equipped with a new stopper rod mechanism for both open and submerged casting, and the supply scope includes modern CONVEX technology and marking machines.
Toledos Berong nickel project delayed due to heavy rainfall
Toledo Mining Corporation said heavy rainfall caused by two typhoons in late September and early October has caused a two week delay to the trial bulk metallurgical sample at its Berong nickel project in the Philippines.
The sample was expected to be extracted in mid October with shipment to customers in China in late October or November.
Commercial operations are now expected to commence in November -December and are dependent upon attaining the necessary final approvals from the Philippine Government.
BlueScope postpones relining of Port Kembla BF
BlueScope Steel, which had previously advised that its board would decide the timing of the reline of its BF No 5 at the Port Kembla Steelworks around November 2006, has announced that continuing reliable performance of the blast furnace has enabled it to reschedule the reline from September 2007 to March 2009.
BlueScope said "The No. 5 Blast Furnace was last relined in 1991 and has produced 37 million tonnes of iron to date. Whilst it is prudent to be prepared to reline a blast furnace of this age, the plant continues to perform well and produced about half of Port Kembla Steelworks' record iron make of 5.209 million tonnes during last financial year. The strong performance of the Furnace is continuing. The good condition of this plant is a tribute to the excellent operating and maintenance practices used by the men and women working in this area of Port Kembla Steelworks.
Mr Noel Cornish president Australian and New Zealand Industrial Markets said "No 5 Blast Furnace is in the 15th year of its current campaign and a comprehensive technical and operational review shows that this furnace can now be operated safely and reliably beyond 2007. The No 5 Blast Furnace reline is now estimated to cost $330 million. This is a $30 million increase on previous estimates due to inflation, maintaining a level of readiness and minor adjustments to project scope. The reline is still expected to take 90-100 days to complete.
Mr Cornish said "The Company will continue to monitor the condition of No. 5 Blast Furnace and will complete necessary design, engineering and procurement of critical items to ensure we are ready to undertake the reline when required. Delivery of long lead-time components will be completed by March 2007."
Ipscos net profit surges by 47% in Q3
Ipsco Inc announced that its third quarter profit rose by 47% YoY to a record as the company's tax rate fell and demand improved for metal equipment used in energy exploration. Its net income in Q3 of 2006 rose to $197 million in Q3 of 2005.and sales rose by 37% YoY to a record $997 million in the quarter as compared to $726.1 million in Q3 of 2005. Ipscos shipments during the quarter increased to 1.04 million tons from 0.848 million driven by demand from Canadian and US oil & gas drillers and pipeline companies.
Ipsco, whose 3 steel mills and 6 pipe mills in Canada and the US depend on scrap steel, said its third quarter product price averaged a record $957 per ton up by 12% from a year ago. At the same time, the price of scrap surged 33%. Operating profit per ton increased 16% to $277. Geographically, sales in Canada rose by 8.6% to $289.7 million while US sales surged 54% to $707.2 million.
Mr David Sutherland CEO of Ipsco in the statement said Record sales volume and higher margins driven by record average product pricing pushed earnings above the high end of our guidance for the quarter. We expect end user demand for plate and energy tubular goods will continue to be strong. While energy prices have fallen recently, we expect them to remain at levels sufficient to maintain high drilling activity and resultant demand. However, demand from service centers and distributor customers is declining in the fourth quarter as these customers reduce inventories."
Mr Sutherland told analysts that although recent robust steel profits make it hard to state a case that unfair imports are harming the industry, there's no question that with the amount of capacity that the Chinese are bringing on, well beyond their own needs and with no material advantage as a steel producer, it's completely unjustified to expect that they could just wander into our market and sell at will when they're coming from a part of the world that does not care about profit. He said "And so what you're already seeing is fairly significant reaction to that across most of the larger developed and steel-consuming areas of the world."
Poland to form 2 groups for coke and coal
Puls Biznesu has reported that Polish government gave up the plans to build a big coal and coke group and now there will be two groups. According to the reports, the management of both coke plants could have influenced the decision.
Polish ministry of the treasure had planned to build a group around JSW coke producer. The group was supposed to be listed on the Warsaw Stock Exchange. After two years of preparations Mr Wojciech Jasinski the minister of the treasure decided that there will be two groups instead of one. Mr Pawel Poncyljusz the deputy Minister of Economy said Walbrzych and Zabrze coke plants will not join the group built around JSW. They will be merged and then listed.
With the recent changes, there will be three groups competing on the Polish market: the merged Zabrze and Walbrzych coke plants, JSW with Przyjazn and Budryk as well as Zdzieszowice coke plant owned by Mittal Steel Poland.
Mr Janusz Olszowski CEO of the Mining Chamber of Industry and Trade said This decision will adversely affect the economy. The idea was to build a strong group on the basis of JSW which would compete with Mittal Steel and raise funds for investments.
Mt Gibson warns on Aztec bid walk-away
Mount Gibson Iron warned that it might still walk away from its $280 million bid for Kimberley rival Aztec Resources after Aztec agreed to pay $17.5 million to buy out a royalty and claw back agreement that threatened to send it to the wall.
Mr Luke Tonkin chief of Mt Gibson said that the company would now wait to see whether Aztec secured financing before deciding whether to continue with its one for three offer. Mr Tonkin also termed ARC agreement as a major concern that raised concerns about the action and disclosure of the Aztec board. He said Its pretty apparent were not happy about the circumstances and I think there are some very serious questions to be answered by the Aztec board about when the caveat was lodged and if they were on top of it, why didnt they announce it.
Aztec yesterday announced that it would issue over 77.7 million new shares worth $17.5 million to Australian Royalties Corp, the former owner of a 30% stake in its Koolan Island leases, to cancel a $1 a tonne production royalty and lift a caveat ARC had lodged over the key mine leases. The deal also removed ARCs right to repurchase the tenement stake for $1 if Aztec failed to start mining of at least 500,000 tonnes of ore by mid June. This is in addition to $12 million in cash and shares already paid by Aztec to ARC in a 2003 agreement to buy out the 30% interest.
Mr Ian Burston chairman of Aztec termed the agreement as a good commercial deal and that it also removed the caveat and paved the way for the funding package to be approved. Mr Burston said he was now confident that funding would be available in the next few days and that production would begin early next year ahead of the first shipment in March.
UMW calls for safer coal mines
It is reported that coal miners from West Virginia and Pennsylvania protested at a federal mine safety office demanding stronger safety measures and better enforcement.
UMW demanded that Mr Richard Stickler, the new head of the federal Mine Safety and Health Administration, act immediately to make coalmines safer. UMW says that Mr Stickler should review proposed safety regulations the Bush administration scrapped in 2001.
Mr Phil Smith spokesman of UMW said that the union also wants thorough testing of the air packs that miners depend on to keep them alive in fires, explosions and entrapments. They also want MSHA to lay out a timetable for hiring more federal inspectors and getting them underground.
A day earlier, a Pennsylvania miner was killed in an explosion, bringing the number of coal mine fatalities in US to 42 this year, nearly double last year's total of 22.
Japans Kashima port witnesses 2 more ship accidents due to bad weather
It is reported that 2 freighters ran aground amid bad weather at a northeastern Japanese port on Tuesday and that all the crewmembers are safe.
A Chinese registered cargo vessel hit the breakwater at Kashima port 95 kilometers northeast of Tokyo. The 88,853 ton Ocean Victory was trying to take a turn as it was leaving the pier to avoid high waves and ran aground in shallow water nearby and began taking in some water. Japanese coastguards said that the Ocean Victory was unloading its cargo of iron ore when the captain decided to move out of the port to avoid strong winds and rain.
Another Panamanian registered Ellida Ace ran aground after being driven away from the waterway near the same port due to heavy winds. The 85,350 ton ship was carrying 163,000 tons of coal from a Canadian port.
Earlier this month near Kashima, another Panamanian registered ship, the Giant Step, ran aground in stormy weather after catching fire. 16 sailors from the Giant Step were rescued after the 98,587-ton freighter broke up about 2 kilometers from the port but 8 of crewmembers were later found dead and 2 others are still missing.
NKMZ to supply equipment to restart old caster at NLMK
Interfax has reported that Ukrainian heavy equipment maker Novokramatorsk Machinebuilding Plant will supply equipment for an old continuous caster to Novolipetsk Steel by 2008 to increase its capacity.
Under the terms of the contract, the value of which has not been disclosed, NKMZ will make and deliver equipment within 14 months for the refurbishment of a non-operating continuous casting machine that was built by Russia's Uralmash.
NKMZ said "For the first time in world practice, NKMZ specialists have undertaken to revive a long obsolete vertical continuous casting machine and adapt it to production of modern steel products.
AK Steel reports profits for Q3 despite lower shipments due to lockout
AK Steel Holding Corp announced that it swung to a profit in the third quarter helped by higher prices that offset a decline in shipments as the steel maker operates its Middletown Works with replacement workers. But company officials warned that higher costs for energy and raw materials in the fourth quarter, along with planned maintenance outages, could erode profits.
AK Steel reported earnings of $26 million for the July to September quarter as compared with a loss of $29 million in Q3 of 2005. Sales were $1.55 billion compared with $1.39 billion a year ago. Results included a charge of $15.8 million for implementing new labor agreements at the company's Zanesville in Ohio and Butler in Pennsylvania operations and a $3 million reduction in the value of a deferred tax asset due primarily to a change in Pennsylvania tax law. Excluding these items, earnings would have been $39.7 million.
For the first nine months of 2006, AK reported net income of $63.1 million as compared with $39.2 million. Sales were $4.49 billion, compared with $4.27 billion.
Mr James Wainscott chairman and CEO said in a statement "In a defining year, AK Steel's most recent operating and financial results continued a steady upward trend. Although we recently have seen some slowing in a few of our key carbon steel markets, we anticipate continued strong demand during the fourth quarter for our stainless and electrical products."
3rd Chinese Copper Conference
Metal Bulletin & Minmetal are organizing the 3rd Chinese Copper Conference on 15th to 17th November 2006 at Shanghai in China.
Funds might be largely responsible for the current runaway prices in copper, but there is no doubting the fact that Chinese demand for copper has been underpinning a healthy and rising price for the red metal for several years now and while investors may come and go, Chinese consumption is here to stay.
China is the worlds single biggest user of copper, with consumption reaching some 3.5 million tonnes in 2005, an 83% increase in the last 5 years. And while the annual growth in consumption is expected to fall to 8% to 9% in the next 5 years and possibly to 3% to 4% thereafter, in absolute terms usage will still be enormous.
Demand is being driven in China by strong local consumption double digit growth in the production of household appliances over the past decade, a pressing need to expand and modernize the national power grid, a massive construction program requiring miles and miles of wiring and cable and copper-intensive finished goods for exports.
China has made strides in the transition from controlled to market economy, towards a modern industry that can compete, not only on cost but also quality, at international level, but there are many hurdles still to be overcome. Deregulation needs to continue in many spheres to allow for greater efficiency and flexibility in meeting market demands and securing greater access to investment finance.
The Chinese copper industry, from mine through to fabricator, s seriously fragmented, with only five companies capable of producing over 100,000 tonnes per year of refined metal and something like 4,500 wire and cable makers jostling for market share at the opposite end of the supply chain. Bigger, stronger companies are slowly emerging, and many smaller ones are succumbing to market and government forces. More and more foreign investment is coming into the country as overseas companies recognize the strategic importance and economic realities of producing in China.
But there is a great deal to be done, and while high metals prices may provide some cushioning for the industry in the short-term, the next few years will see enormous changes in this vast and fluid marketplace.
EU asks China to open up to foreign companies
The European Commission in a paper outlining how the EU should deal with China in the future said that China should open its market to foreign companies to prove that trade is a two way street. It said Europe's openness to a recent flood of Chinese imports had helped China's rapid export led growth but now it was time for Beijing to reciprocate by strengthening its commitment to economic openness and market reform.
EU said China still needs to do substantial work to implement WTO trade law and should honor a commitment to join a global agreement to open up government tenders to foreigners. The EU asked Beijing to beef up legal protection for foreigners doing business in China, stop demanding European companies hand over technology to Chinese partners and end unfair subsidies to strategic industries.
It said "EU companies often find themselves competing on unfair terms in China. The absence of conditions of fair market competition and inadequate legal protection pose serious problems. China's policies on the environment, social standards, currency valuation and natural resources can distort trade."
The EU worried that a "China first approach" was emerging in key sectors such as cars, steel, semiconductors or shipbuilding. Taxation, banking and local content requirements already favor local companies over EU exports, it said, highlighting a risk that antitrust policy and a lack of independent regulators would see the law give preference to Chinese companies.
Europe had a 106 billion ($133 billion) trade deficit with China last year. The EU is China's largest export market.
Carlyle's Maneely to buy Atlas Tube Report
It is reported that John Maneely Co, a maker of steel tubing that is owned by the private equity giant Carlyle Group, is expected to announce a merger with Atlas Tube Inc in a deal valued at almost $1.5 billion including stock and debt.
The deal comes amid a boom of so called private equity deals, in which groups like Carlyle team up to buy companies they believe are undervalued often using elaborate financial engineering with hopes of selling them later at a profit.
POSCO to install a new bloom caster
POSCO has awarded a contract to Concast for the supply of a 3 strand continuous bloom caster at its Pohang works. The first cast is planned for December 31st 2007.
The plant with a 16.5 meter casting radius and multi point straightening is equipped with Concast technology including plate type molds with mold stirrer, strand stirrer rotating type, air mist cooling system, mechanical soft reduction at the pinch roll unit with a total of eleven modules, torch cutter with deburrer as well as bloom marking.
The section size of the blooms is 400mm x 500mm and the special steel grades to be cast will include cold heading steels, spring steel, bearing steel, tire wires and welding wires.
Russian SS output up by 29% YoY in January to September
Russian Federal State Statistics Service announced that Russian companies have raised production of stainless steel roll by 28.6% YoY during January to September 2006 to 76,200 tonnes.
Mechels Chelyabinsk Iron & Steel Works increased SS output by 140% YoY to 33,052 tonnes. The Serp I Molot plant in Moscow reduced output by 31.9% YoY to 2,475 tonnes and Elektrostal near Moscow reduced it by 11.2% YoY to 7,744 tonnes. The Krasny Oktyabr plant in Volgograd raised production by 19.7% YoY to 5,698 tonnes and production rose by 4.5% to 11,255 tonnes at Mechel's Izhstal plant in Udmurtia.
Incos operations at Manitoba still affected
It is reported that Incos nickel operations at its Thompson Manitoba, division are still being affected by an incident in the second week of September which caused the suspension of one of the two smelter furnaces.
Inco while announcing Q3 results said that while nickel refining activities at Manitoba have returned to stable operations they have not reached their prior levels.
Ukraine to set up financing firm for coal industry
Ukraine government plans to set up a Coal Leasing Co by the beginning of 2007 to give mines opportunity to acquire new equipment. Mr Sergei Tulub minister for coal told reporters that the company will be set up on the basis of the ministry but Ukrainian manufacturers of mining equipment might be involved in the company's work on a commercial basis.
Mr Tulub also said that his ministry plans to introduce a new method for calculating prices for coal based on its heating properties as of January 1. The ministry has submitted a draft of the method to the Fuel and Energy Ministry for approval. He said "A working group has been created, and we hold meetings every three days. We are deciding, going through each factor gradually.
Mr Tulub informed that losses of Ukrainian coal industry tripled YoY to 1.8 billion hryvni in the first nine months of 2006 and are likely to add up to 2.4 billion hryvni in 2006.
BHPBs Yabulu nickel refinery increases production in Q3
It is reported that the refined nickel production at BHP Billitons Yabulu refinery in Australia recovered to 7,300 tonnes in the third quarter of this year from 4,300 tonnes in Q2 and was also up on the 6,100 tonnes produced in the Q3 of 2005.
That dip in the second quarter was caused by work associated with the ongoing expansion of the Yabulu plant from 31,500 tonnes per year to 75,000 tonnes per year. The expansion, which is tied in to development of the Ravensthorpe mine is now 81% complete. Commissioning will actually start ahead of the receipt of nickel-cobalt hydroxide feed from Ravensthorpe.
BHP Billiton said that pre commissioning and commissioning of Ravensthorpe are progressing and first mining activity began in September. The mine is scheduled to produce around 50,000 tonne per year of nickel in hydroxide.
Outokumpus SS mills running at full capacity
Finnish stainless steel producer Outokumpu said that demand for stainless steel remains strong with its mills running at full load and order backlogs still firm. The company said demand for stainless steel remained strong even through Q3, which encompasses the European holiday period.
Outokumpu said it is currently selling for deliveries in February of next year and achieving small base price increases for both January and February even from already historically high levels.
Critically, in terms of the industry re stocking that has been underway since the start of the year, it said It seems that customer inventories have increased only moderately closer to normal levels suggesting continued strength through the current quarter."
