October, 26 2006
SAIL to raise $ 4.4 billion to part fund expansions
Steel Authority of India Limited is considering options to raise money from overseas market through external commercial borrowing to part finance its Rs 37,000 crore ($8 billion) expansion program. As SAIL is almost debt free company, it is looking at market borrowings with the hope of getting funds at attractive rate of interest.
Mr S K Roongta chairman of SAIL told media We are looking at a debt equity ratio of 1:1 for meeting the funding requirements of the expansion. This would mean borrowings to the tune of Rs 20,000 ($4.4 billion). We may look at ECB route to part finance debt, but no decision has yet been taken on the matter. The remaining shall be funded from internal accruals.
Mr Roongta said "The entire investment will be spread over 4 years to 5 years. As and when we require funds we shall approach the market. We have to start putting financing plan in place by the end of this year particularly the debt portion."
SAILs immediate expansion plans aim at increasing steel production capacity to 22.5 million tonnes from present 14 million tonnes by 2010 and subsequently SAIL may consider expansions to reach 40 million tonnes capacity. The modernization plan includes expansion of the existing facilities as well as setting up new plants. All the five integrated steel plants of SAIL would undergo modernization both in terms of size and scope simultaneously.
JSW Steel plans a 10 million tonne plant in Orissa Report
The Economic Times has reported that JSW Steel, in addition to already announced plans for setting up a 10 million tonne plant in Jharkhand, 4 million tonne plant in West Bengal and expansion of its existing Vijainagar plant to 10 million tonnes, is planning to set up a 10 million tonne steel plant in Orissa at an investment Rs 35,000 crore. This would result in a total capacity of 34 million tonnes for JSW Steel, if all the plans take shape.
The report cites a senior company official confirming Orissa investment plans as saying We are currently at the final stages of preparing a detailed project report for our proposed investment in Orissa. Once this is through, we hope to sign a MoU with the Orissa government. This may be done soon.
The report also mentions that Orissa government is evaluating the initial proposal of JSW Steel for the investment but no decision has been taken yet.
This plan could be due to delays being encountered for allocation of land and iron ore deposits in Jharkhand.
India to rely on coal based power plants
It is reported that Indian government has decided against setting up new gas fired power plants in view of the acute shortages of natural gas for existing stations and that the government is instead focusing on large sized coal fired stations.
Mr RV Shahi power secretary on the sidelines of Power Gen 2006 conference and exhibition said "We are not suggesting any new gas based power plants till there is greater clarity on availability and price of the fuel. In 11th Plan also, we are targeting only 2,000MW of gas based capacity out of the total 75,000MW.
Mr Shahi said a large capacity in the country was currently underutilized due to gas shortages and that prices of natural gas and LNG have also increased substantially over the past two years. He said "There is no new production coming up in the country. While ONGC has not found any new gas field, Reliance Industries gas-field in K-G basin is only expected to start production from middle of 2008.
Usha Martin to set up bright bar unit in Chennai
Usha Martin Limited has announced plans to invest Rs 27 crore to set up a bright bar manufacturing plant in Chennai to meet requirements of the automobile industry in the southern region.
Mr Rajeev Jhawar MD of Usha Martin told reporters that the land has already been acquired and the project would be commissioned in 2 years. He added that the project would be funded from internal accruals.
World Mining Congress at New Delhi in December
The Indian National Committee of World Mining Congress will be hosting the 87th meeting of the International Organizing Committee of the World Mining Congress at New Delhi from 11th to 13th December 2006, which will witness the assemblage of global leaders of coal industry.
Coal is vital for global energy security and is available and affordable as a reliable energy source. In the future global energy mix, coal will have a key role to discharge and coal will also be a major source for a host of chemicals and as source of hydrogen for the future hydrogen based global economy. The Congress therefore, will provide an ideal international platform to look into the emerging role of coal for sustaining human civilization.
The Congress will deliberate broadly on the expanding role of coal in global energy future, expanding the resource base in coal, new technology & innovations for exploitation of coal, new directions for sustainable development of global coal industry, expanding role of coal in the power generation, coal as the basis for future hydrogen economy and a source of new chemicals, coal bed methane, coal gasification, coal to oil, improving environmental performance of coal, clean coal technology for power sector, utilization & disposal of ash, environment related issues, social issues, safety, training and research & development.
The Indian National Committee is also organizing an International Coal Congress & Expo, concurrent with this meeting of IOC on the theme Sustainable Development of Coal for Energy Security.
Indian Railway allowed for private investment in non transport operations
Indian Railways has clarified that the government policy allows private sector investment and ownership in rail track, rolling stock, container depots and any other infrastructure related to a railway system, which are not train operations and that present policy bars private sector entry in train operations only. It said that foreign direct investment of up to 100% is permitted under the automatic route in railway infrastructure.
Indian railway said that rail transport is defined as operation of freight and passenger trains, and does not include ownership of track, rolling stock and any other infrastructure related to a railway system. Under the industrial policy only railway transport is reserved for public sector.
This clarification has come as a response to some reports in media that Indian Railways plans for private participation need amendment of industrial policy by the parliament.
Electrosteel Casting posts 52% YoY increase in profit for Q2
Kolkata based Electrosteel Castings Ltd has posted an increase of 52% YoY in its second quarter net profit at Rs 29.51 crore over the same period last year. Production of ECL grew by 28.84% YoY.
As per the release, ECL has benefited from the commissioning of backward integration projects including coke ovens, sponge iron plant and a 12MW power plant at its Haldia plant.
Usha Martins net surges by 59.73% in Q2
Indias leading special steel producer Usha Martin has registered a 59.73% increase in net profit at Rs 23.72 crore for July to September quarter 2006. Its total sales for the quarter also increased by 18.99% YoY to Rs 353.44 crore.
For the first half of, Usha Martins profit before tax increased by 29% YoY to Rs 56.70 crore and profit after tax moved up by 57% YoY to Rs 44.05 crore. During the period, sales increased by 17% YoY to Rs 655.35 crore. Captive consumption of steel for value addition registered a growth of more than 28% at 79,061 tonne.
Usha Martin was established in 1960 as Usha Martin Black to manufacture wire rope. It merged with Usha Beltron, a subsidiary manufacturing telephone cables, in 1997 and changed its name from Usha Beltron to Usha Martin in 2003. The company has three manufacturing divisions of wire, wire rope and steel and cables. It has technical collaborations with KabelRheydt and Stolberger Maschinenfabrik, Germany among others. The company has subsidiaries in UK, Thailand, Singapore and Dubai.
Alstom to expand facilities to make super critical boilers
It is reported that French power equipment major Alstom is planning to set up facilities to manufacture super critical boilers of 800MW size & above for mega power plants planned in India. Alstom has informed Indian government that it will expand its existing manufacturing facilities at Shahabad in Karnataka and Durgapur in West Bengal to build super critical boilers.
Alstoms Shahabad unit currently manufactures boiler products such as coal pulverizes & milling system, high pressure piping, soot blowers, heavy fabrication parts, hydro mechanical equipment, heat exchangers, condensers. While the Durgapur unit is equipped to fabricate pressure parts and boiler drums.
Super critical technology helps produce power more efficiently. This helps reduce emissions of carbon dioxide and other pollutants, as it uses less fuel per unit of electricity generated. Super critical technology entails boilers and turbines of higher capacity for the benefits of economies of scale. As demand for electricity and environmental concerns rises, Indian power generators are seeking to deploy super critical technology.
Alstoms decision will lead to increased manufacturing capacity in India reducing the cost of these super critical units due to reduced dependence on imports.
Arcelor Mittal to file offer for Arcelor Brazil shares with CVM
Mittal Steel announced that pursuant to the decision of the Comiss De Valores Mobiliios of September 25, 2006, Arcelor Mittal will file with the CVM a request for registration with respect to a public offer for all of the remaining outstanding shares in Arcelor Brazil SA that are not yet owned by Arcelor SA or any other affiliate of Arcelor Mittal.
As per the release, the reference value to be offered per Arcelor Brazil share, determined on the basis of the relative values of Arcelor Brazil EBITDA and Arcelor EBITDA shall be Euro 12.1184.
The description set forth below corresponds to the offer as described in the request for registration. Under the terms of the Offer, Arcelor Brazil shareholders tendering their shares in the Offer will receive consideration equal to the reference value per share tendered. The consideration may be received in one of the two following forms, at the option of the holder.
1. In cash, to be paid in Brazilian Reais, using the exchange rate in effect on the last day of the offer period.
2. Or, in a mixture of cash, for 30.4% of the reference value and Class A Common shares of Arcelor Mittal for 69.6% of the reference value, where the cash portion will be paid in Brazilian Reais converted using the reference exchange rate and the share portion per Arcelor Brazil share will be satisfied by delivering a number of Arcelor Mittal shares arrived at by dividing 69.6% of the reference value.
The maximum amount of cash to be paid by Arcelor Mittal will be approximately Euro 2.6 billion, assuming 100% acceptance of the cash option and the maximum number of Arcelor Mittal shares to be issued will be approximately 52.8 million, representing 3.7% of the share capital of Arcelor Mittal on a fully diluted basis assuming 100% acceptance of the Mixed Option.
In its decision, the CVM determined that, following the completion of Mittal Steels offer for Arcelor, Arcelor Mittal was required to carry out a public offer to acquire Arcelor Brazil shares in order to ensure that the shareholders of Arcelor Brazil have the option to sell their shares for the same value indirectly paid for the Arcelor Brazil shares held by Arcelor. Arcelor Mittal holds, through Arcelor, approximately 66% of the shares in Arcelor Brazil.
Wheeling-Pitt reaffirms plans to merge with CSN
Wheeling Pittsburgh Steel Corp reaffirmed its intention to merge with Companhia Siderurgica Nacional despite some shareholders' objections, signing an agreement to create what it claims will be a well capitalized company with a more flexible cost structure.
Mr James G. Bradley chairman & CEO of Wheeling Pitt said he's confident that the deal with CSN positions his company to deliver sustainable earnings as well as solid future cash flows.
The agreement needs to be approved by shareholders in a vote sometime in January. And shareholders have a chance to reject the plan at the November 17 annual meeting in Wheeling, where they will be asked to choose between Bradley's team and a competing board of directors.
The structuring of the CSN deal calls for a $225 million, 9 percent interest loan that would convert to 11.8 million shares in the new company. CSN would take 49.5% ownership of the new company, while Wheeling-Pitt shareholders would control the other 50.5%. But the deal also calls for CSN's ownership to jump to 64% after 18 months, subject to the union's approval. If the union rejects their ownership, the $225 million becomes debt.
Chinese steel may flood Asia market
A Reuters report outlined the growing risks that China will inundate the region with cheap steel supplies, depressing prices and hurting profits at Japanese and other Asian steel makers. A potential US ban on Chinese steel imports is spurring immediate concerns, but analysts also see China move up the steel value chain and become a true competitor to Japan and South Korea.
Mr Atsushi Yamaguchi an analyst at UBS said "China's brisk exports to the U.S. have so far absorbed massive surplus in its domestic steel supplies. But rising production in Europe, a slowdown in US demand from the construction sector and a potential dumping charge against Chinese mills could change the whole picture."
If Washington slapped anti dumping duties on Chinese steel or ban imports from China, it would lead to a surge in Chinese supplies in southeast Asia and in China itself, dragging down steel prices across the region.
For now, shares of major Japanese steel makers such as Nippon Steel Corp, JFE Holdings Inc, Kobe Steel Ltd and Sumitomo Metal Industries Ltd or South Korea's POSCO have not reacted to already weakening prices and likely US anti dumping charges on Chinese steel products. That's because China mainly makes low end products, such as those used in the construction industry, while major Japanese firms rely nearly 85% of their business on high end products.
However, in the longer term the China threat looms large.
CVRD puts 40% increase for iron ore price as starting point
Mr Jose Martins in-charge of CVRDs iron ore business during the steel and raw material conference in Qingdao said that benchmark ore price will rise 40% further for next fiscal year as ore supply still lags behind steel production growth.
Mr Martins said Once steel supply comes beyond demand, the ore price will naturally come down, but it's not the real case in China. CVRD will not compromise as to the price. Chinese buyers can sign longer contracts if they want to save money.
The new round iron ore price talk will begin from end November or early December 2006.
EU suspends AD on Chinese FeMo
The European Union has announced to suspend an anti dumping duty of 22.5% on imports of Ferro Molybdenum from China. The EU Commission said European Fe Moly producers are not likely to get injured after the duty was paused taking into account its great up rise in price during these years.
The duty, which was put into force in 2002, is suspended for a period of nine months effective from 24 October. During this period, the commission says it will monitor the imports and prices of the product, and will resume the duty if there are similar dumping activities, which poses a threat to the domestic FeMoly producers.
According to EU commission, the price of FeMo has increased from about $8 per kg Mo in 2002 to $80 per kg Mo in 2005 and currently stands at about $60 per kg.
(Sourced from Mysteel.net)
Chinese iron ore production gaining solid grounds UNCTAD
The rising import contract prices and freight rates for iron ore are encouraging China to look increasingly to domestic alternatives for the raw material. Mr Olle Ostensson of natural resources office of UN Conference on Trade and Development said The higher freight rates and contract prices are the biggest incentive for China's domestic iron ore miners.
Mr Ostensson while speaking at the China International Steel & Raw Materials Conference said The most surprising thing has been the 35% rise in China's iron ore output in the first seven months. Despite China's iron ore quality being significantly lower than the world average, it will nevertheless become the world's second biggest producer.
Mr Ostensson said China's domestic output of iron ore was far outpacing the much-publicized increases in steel production that have made it the world's largest steel maker. He said the growth in iron ore production would allow China to supply an ever-increasing portion of its mill demand and allow it to overtake Australia as the world's second biggest miner of the raw material. Of the 1.3 billion tons of iron ore mined last year, Brazil accounted for 22%, Australia 20% and China 16%.
Steel prices fall in south and increase in northern Europe MEPS
MEPS has reported that the prices for flat rolled steel products in the European market are showing widely divergent trends this month and that a steep gradient has emerged with prices get progressively stronger as you move from south to north in Europe. Prices are falling in Italy but rising in Germany and Scandinavia.
The MEPS published that negotiated basis prices in Italy have fallen this month by 6% for hot rolled coil and by 6.7% for cold reduced coil. The prices for plate and hot dip galvanized have also come down, but by only 3% in the same comparison. This weakness is spilling over into neighboring countries such as Austria, southern France and Spain.
MEPS said that, whereas in northern Europe, mills have had some success in winning the price increases for flat products. This is the case for hot rolled coil and galvanized, where the German market is seeing month on month increases. Cold rolled coil prices have moved up less strongly.
Part of the reason for the divergent price trends is the volume of imports of strip products from third countries into the EU. These have been at record levels this year and are being concentrated very much in southern Europe. Evidence from import license applications suggests that volumes will remain high through to the end of the year.
Shipments from China are particularly noteworthy. They reached 1.7 million tonnes in January to July and may exceed 4 million tonnes for the whole year. Chinese producers have indicated that they will be reining back their exports to Europe in 2007. If they do, other suppliers in Iran, India and Egypt may step in to fill the gap.
MEPS said that the current imports are adding to the over supply which is now coming to characterize the market. Restocking after last years inventory liquidation is now essentially complete. But EU-25 crude steel output continues to rise. It is up more than 6 percent so far in 2006. MEPSs projection for the full twelve months is 199 million tonnes, an increase of almost 7%. This is far in excess of actual demand. Stockholders seem to be confident of good trading conditions in quarter four. But current values are likely to be the peak certainly for hot rolled and cold rolled coil. Galvanized prices may keep some upward momentum into 2007, partly because of the price of zinc, which recently hit a new record high.
MEPS said that the prices for some long products are holding up better than flat products. Although concrete reinforcing bar values are down this month in some countries, partly because of lower scrap prices, other long products are generally firm.
Compared with September, negotiated basis prices for medium sections and beams have risen by 2.3 percent in Germany and France, and by more than 4 percent in Spain and Italy. Availability appears to be quite restricted. Mills may not be producing all the tonnage that they could, and there are also reports of operating problems at some section mills.
Inco plans to expand after takeover by CVRD
Mr Scott Hand CEO of Inco during a press conference organized, along with Mr Roger Agnelli CEO of CVRD, to discuss preliminary plans after the $19 billion transaction that forms a new company called CVRD Inco said that new company is looking to expand its operations rather than lay off employees.
Mr Hand said "We need people, this is not a slash-and-burn deal." He said Inco is laying out plans to expand in the Sudbury Basin of northern Ontario and at the miner's nickel operations in the northern Manitoba community of Thompson. Inco is also developing a major mine at Voisey's Bay in northeastern Labrador.
Mr Agnelli told that the company isn't planning to sell Inco assets. He said "We do not need to fund the transaction by selling assets. We do not work to sell. We have a very strong cash flow and the market is very strong. Everything is positive. He told reporters that, at current nickel prices, CVRD could cover the full cost or reduce leverage on the Inco transaction within two or three years.
Baosteel to represent Chinese steel mills in iron ore talks
Chinese steel giant Baosteel Group will once again be representing China in next year's iron ore talks with international miners. China's Iron and Steel Association has decided to keep the same negotiation strategy, but local trading companies will be playing a bigger role in next year's talks.
Meanwhile the Ministry of Commerce is forecasting a fall in iron ore prices due to an expected surplus in the international market. The ministry also expects the country's iron ore imports this year to rise to 320 million tonnes from 275 million tonnes last year.
(Sourced from Mysteel.net)
Bustle pipe bursts at Mittal Steel Burn Harbor
It is reported that 3 people were injured when a bustle pipe burst Tuesday night at Mittal Steel USA Burns Harbor. The incident occurred shortly before 10 p.m. Tuesday at the plant.
Mr David Allen a company spokesman said that he did not know the severity of the injuries, but the employees were taken to the hospital for treatment of burns.
Mr Allen said he did not know for certain whether there was actually a fire at the plant. He explained that a bustle pipe carries heated air into the blast furnace. Mr Allen informed that the blast furnace was shut down.
Tubacex to post higher results for 2006
Tubacex SA announced that it expects EBIT for 2006 to reach over Euro 40 million as compared to the Euro 37 million for 2005. In a presentation to analysts at the Madrid Stock Exchange, the stainless steel tube manufacturer said it also sees an uptick in sales and net profit in 2006 from a year earlier, but did not provide specific figures.
Mr Alvero Videgain chairman of Tubacex said that he expects business in 2007 to be very positive due to a healthy outlook for the market for seamless stainless steel tubing and a more profitable business mix.
AK Serov orders a new rolling mill
Danieli Morgdshammar has signed a contract with Ural Mining & Metallurgical Company for the supply and the installation a new rolling mill in the region of Tyumen in Ural for the Metallurgical Plant AK Serov. After completion the plant will produce up to 0.55 million tonnes of high quality special steel mainly for the constructive and engineering industry. Commissioning is scheduled for the second half of 2008.
The scope of supply includes a rolling mill, which will use 130mmx130mm and 150mmx150mm billets in 12 meters length to round bars in the diameter range from 10mm to 42 mm. The finishing mill will be a Kocks 3 roll Reducing & Sizing Block equipped with five stands with a nominal roll diameter of 300 mm. A large diameter range of up to 3 mm can be rolled with one and the same pass at closest tolerances. A future stage of extension will allow the additional production of wire rod as well as bar in coils.
This plant, headquartered in Serov / Sverdlovsk Region was founded in 1894.
Arcelor Brazil shares plunge after Mittal offer
Shares in the Brazilian unit of Arcelor Mittal fell sharply on Wednesday after Arcelor Mittal announced that it would bid for the shares it does not already own in Arcelor Brazil at a price some investors found disappointing. Shares in Arcelor Brazil were down by 8.4% at 36.41 reais midway through the session although the benchmark Bovespa index of the Sao Paulo Stock Exchange was up 0.33% at the time.
Some analysts voiced concern that the offer price was too low. Mr Pedro Galdi, a steel analyst at ANB Amro in Sao Paulo said "I think shareholders are going to reject it. It's much lower than the value."
The maximum amount of cash to be paid by Arcelor Mittal would be approximately $3.27 billion if all shareholders chose the cash option. Arcelor Brazil had earlier estimated the value of its outstanding shares at about $5 billion.
ICG posts loss for Q3 of 2006 despite increased shipments
International Coal Group Inc today has reported that its revenue was $224.3 million for July to September 2006 quarter as compared to $158.4 million in July to September 2005 and the net loss was $2.4 million as compared to net income of $8.6 million in Q3 of 2005.
Revenues for the nine months ended September 30, 2006 totaled $659.8 million as compared to $465.7 million for the same period in 2005. Net loss for the first nine months of 2006 was $9.2 million versus net income of $28.5 million.
ICG sold 5 million tons of coal during the third quarter of 2006 as compared to 3.6 million tons in the same 2005 period. Production totaled 4.3 million tons in the third quarter of 2006 versus 3.0 million tons in the third quarter of 2005. During the first nine months of 2006, ICG sold 14.6 million tons of coal as compared to 10.6 million tons in the same period of 2005. Coal production during the first nine months of 2006 totaled 12.4 million tons versus 9.1 million tons in 2005.
Mr Ben Hatfield president and CEO of ICG said "As we previously announced, the third quarter was very challenging as unexpected adverse mining conditions forced us to idle the Sycamore 2 Mine. During the same period, we experienced a significant increase in operating costs at three other business units. Given the relative softening of spot coal prices over recent months, we moved decisively to shut in high cost coal production and strengthen our operating profile. Thus far in the fourth quarter, our efforts are bearing fruit as we have seen much-improved performance from those operations."
ICG is a leading producer of coal in Northern and Central Appalachia and the Illinois Basin. The Company has 11 active mining complexes, of which 10 are located in Northern and Central Appalachia and one in Central Illinois.
Arcelor Mittal eyeing Stalexports assets
Polish Puls Biznesu has reported that Arcelor Mittal, which already has 5 steel plants in Poland, is interested in the steel plants owned by Stalexport. Mr Jacek Mirenski from Arcelor Mittal said Arcelor Mittal indeed is interested but final decision will be made after we receive the memorandum.
The other company interested in Stalexports assets is Stalprofil, which is also one third owned by Arcelor Mittals Mittal Steel Poland.
The management of listed Stalexport has prepared the memorandum concerning its steel assets, which are to be put out for sale. After the supervisory board approves of the document, potential buyers will receive it this month.
Esmark blasts Wheeling-Pitt & CSN merger announcement
Mr James Bouchard CEO of Chicago based Esmark, which has its own plan to buy the West Virginia based Wheeling-Pitt termed the merger agreement announcement between Wheeling-Pitt and CSN of Brazil as a sham and said that it will never occur.
Mr Bouchard called the agreement as a shotgun marriage arranged out of desperation because Wheeling-Pitt's board knows it doesn't have the votes needed to complete the deal in January. Mr Bouchard said the shareholders of Wheeling-Pitt would vote to impeach the board when it meets November 17th 2006.
The merger calls for Wheeling-Pittsburgh Steel Corp. and Companhia Siderurgica Nacional to combine their North American assets into a new corporation listed on a US stock exchange. CSN would contribute its Terre Haute steel plant and $225 million in cash, which along with Wheeling-Pitt's assets would form the new holding company.
Cleveland Cliffs reports highest quarterly sale in Q3 of 2006
Cleveland-Cliffs Inc reported that its third quarter profit rose on the highest quarterly sales in company history. Its net income was $89.1 million during Q3 of 2006 as compared with $85.6 million in Q3 of 2005. Revenues from iron ore product sales and services during Q3 of 2006 were $580.1 million up by 13% from the record of $514.1 million set in Q3 of 2005.
Cleveland-Cliffs said third-quarter North American pellet sales margin declined to $108.5 million from $119.5 million primarily due to increased production costs, which were partially offset by higher volume and prices. But in Australia, the sales margin more than doubled, reaching $24.0 million from $10.9 million in last year's third quarter. The improvement in sales margin at Portman was due to higher sales prices and volume, partially offset by increased production costs.
Mr Joseph Carrabba CEO said "Results generated thus far in 2006 are consistent with plan. Slightly lower pellet sales volume in North America is being outweighed by good pricing dynamics, and the added contributions from Portman Australia continue to bolster results."
E-United to set up new 0.8 million tonne SS line
Taiwans E-United Group has decided to add a new process line to their new stainless steel mill and has placed an order for hot rolled strip annealing and pickling line with integrated rolling mills with an annual capacity of approximately 0.8 million tonnes. The commissioning is scheduled in January 2009.
Andritz will supply the rolling mills, the mechanical equipment, the thermal section, and the pickling plant and will be responsible for engineering, erection supervision and start up of the complete line.
Andritz supplied hot rolled strip annealing & pickling line and 2 cold rolled strip annealing & pickling lines are already operational at E-United Group.
POSCO to raise SS prices by 20%
POSCO announced that it will raise the domestic prices of its stainless steel products by 20% as the cost of nickel rose. Effective Wednesday, POSCO is raising the local price of stainless hot rolled coil to KRW3.51 million per ton from KRW3.31 million per ton and the price of SS cold rolled coil to KRW3.78 million per ton from KRW3.58 million per ton.
A company spokeswoman said "As the prices of nickel, a key material used to make stainless steel products, continued to rise this year, we have no option but to raise stainless steel prices. This is the seventh time Posco is raising domestic stainless steel prices this year.
MMXs iron ore project update
BNamericas reported that Brazilian mining and metals company MMX has announced plans to build an iron ore complex in Minas Gerais and Rio de Janeiro states that will include a mine, a pipeline, a port and pellet plant.
Construction at the complex is due to start in early 2007 while operations would begin in 2009. The project, focused on exports, is due to ship abroad 26 million tonne per year of iron ore and pellets from 2011.
A MMX press official told BNamericas "Investments in the project could reach $2 billion, not including the pellet plant. The pellet plant alone would require investment of $500 million, though its installed capacity is not yet defined.
The official also said that MMX is in talks to sell a 30% stake in the project to a miner, a steel company or to an investor.
MMX is a subsidiary of Brazilian mining, metals and energy group EBX.
Bilstein to modernizes its 4 stand tandem mill
Bilstein GmbH & Co KG of Hagen-Hohenlimburg in Germany has placed an order for modernization of its 4 stand tandem mill. The aims of the modernization are to increase the production, improve the product quality, enhance the flexibility during production and establish a new operating concept. Plant modernization will be completed at the time of the winter shutdown 2008.
In order to revamp the mill new servo hydraulic control systems are to be provided for roll gap adjustment and roll bending as well as roll gap lubrication dependent on strip width and the dry strip system for strip drying. Equipment for stabilizing the strip tension in the entry and exit sections of the rolling mill and new electrical drive and control equipment will also be supplied.
This facility is used for the roughing and finish rolling not only of hot rolled structural steels but also of casehardening and quenched and tempered steel grades and even highly work hardened special steels.
RMDAS sees decline in ferrous scrap prices for October
According to figures compiled by the Raw Material Data Aggregation Service of Management Science Associates Inc of Pittsburgh steel mills have been offering several dollars less per ton for ferrous scrap so far in October. National averages paid for prompt industrial #1 busheling and bundles have been down by $33 per ton in October, while shredded scrap is down by $15 per ton and #1 heavy melting scrap is down by $9 have declined less dramatically.
The declines were fairly even across all three geographic regions defined by the RMDAS service. Pricing fell slightly less in the South region, but that regions buyers continue to pay the lowest per ton price for scrap in two of the three categories prompt industrial and #1 HMS.
The October RMDAS price figures represented some of the lowest national averages since MSA began disclosing national monthly figures in November of 2005.
The Raw Material Data Aggregation Service Ferrous Scrap Price Index is based on data gathered from a statistically significant compilation of verified ferrous scrap purchase transactions.
LME commissions free on truck study
The London Metal Exchange has launched a study into the consequences of moving warehouse payments to a free on truck basis, from its current in warehouse structure.
The study will be carried out by Europe Economics, an independent economic consultancy, and overseen by Professor Phillip Crowson, a former invited director of the LME. Europe Economics will seek opinions from across the industry during November and anyone who has yet to be contacted is invited to speak to them directly by writing to Dermot Glynn at DermotGlynn@europe-economics.com.
LME in a statement said that it wants all sections of the industry to have a chance to comment on the proposed change so as to ensure "an accurate a view as possible on the consequences of moving to an "FOT" basis."
At present, the company operating the various LME-bonded warehouses takes a fee from the owner of the metal at the time of removal, rather than the time of deposit.
IMSAs net profits in Q3 surge by 21%
Mexican steel maker IMSA has posted a 21.4% increase in third quarter net profit, driven by higher sales. IMSA said that its July-September net was 636 million pesos ($58 million) up from 524 million pesos a year earlier. Revenues rose by 15.4% to 10.1 billion pesos. EBITA totaled 1.453 billion pesos up by 51% from the third quarter in 2005.
Sales volume totaled 885 thousand tonnes for third quarter 2006, a growth of 10.4% YoY.
Mr. Marcelo Canales Clariond, Grupo Imsas CEO explained As we had already anticipated, the results of this quarter were below those of 2Q06. Despite the contraction in operating margins, we posted increased sales volumes which, combined with our enhancement of the productivity and efficiency of our manufacturing processes, contributed to Grupo Imsa posting an EBITDA of US$131 million for 3Q06, a figure that exceeded expectations.
JFEs Guangzhou JV to start auto grade galvanized production soon
It is reported that JFE Steel's Chinese galvanizing JV Guangzhou JFE Steel Sheet will start commercial production of automotive steel and is reported to be in final stage of material approval from transplants of Toyota, Nissan and Honda in Guangzhou starting the shipment as early as in the year.
Guangzhou JFE Steel Sheet, which currently produces materials for construction and appliances, is ramping up the operation to reach full capacity of 400,000 tonnes by spring of 2007.
Largo signs LoI for vanadium deposit in Bahia
Largo Resources Ltd announced that it has signed a LoI with Odebrecht SA and Caemi Mineracao e Metalurgia SA expressing its intention to acquire 90% of Companhia de Maracas, which holds an equity stake of 95.38% in Vanadio de Maracas Ltda., an entity that owns the mining rights of the vanadium substance, located in the municipality of Maracas, State of Bahia.
Upon the potential signing of the respective acquisition agreement, Largo shall acquire a 90% interest in the Company subject to the terms and conditions set forth therein for a purchase price of $10 million.
The property has a reported historical mineral resource, estimated by the previous owners of 10.4 million tonnes of 1.37% Vanadium Pentoxide using a cut off grade of 0.50% V2O5 to a vertical depth of 150 meters. This includes a higher grade core of 6.4 million tonnes grading 1.82% V2O5.
