November, 11 2006
Coking coal import set to shoot up
India the 3rd biggest producer of coal across the world is set to increase its cooking coal import by 76% during current financial year (2005-06). Even after importing about 31 million metric tones (mmt) there would be unmet demand of 7.8mmt this year.
According to The Planning Commission, under the Coal vision 2025The demand of coal in the year 2024-25 is expected to reach 1267mmt against the current demand of 445.7mmt so asked the ministry of coal to take up projects to meet the future requirements.
TATA Steel set to bid for projects in Tanzania
TATA steel is set to bid for 2 projects in Tanzania involving coal and iron ore mining with reserves of up to 1.2 billion tonnes of iron ore and about 500 million tonnes of coal respectively. With an investment of $1billion.
According to Tanzanias National Development Corporation (NDC), the companies would be evaluated after going through and filing the request for proposal (RFP) documents. Those eligible will compete in an open tender sources said.
TATA Steel had earlier stated its interest in scouting for raw materials in Africa, Australia and South East Asia, sources said. The bidding process is expected to be over in 3 months and work is likely to begin next year.
Hindustan Zinc raises price by Rs 1,200 tonne
India's top zinc producer, Hindustan Zinc Ltd., announced that it had raised zinc prices by Rs1, 200 rupees a tonne, or by 0.54 % to Rs223, 000 with immediate effect.
The company also increased lead prices by Rs700 rupees a tonne, or 0.83 %, to Rs 85,300 in a statement.
TATA Steels NatSteel to expand finished product capacity
It is reported that TATA Steels NatSteel Asia Pte Ltd plans to expand capacity to 5 million tonns to 6 million tonnes a year of finished steel products from current 2 million tonnes mainly in Vietnam, the Philippines and Indonesia in the next 5 to 6 years to capture part of the likely increase in demand from construction sector in South East Asean countries.
Mr Oo Soon Hee president and CEO of NatSteel Asia told visiting journalists that the expansion would be in downstream products such as wire making, cut and bend reinforcement bars. Mr Hee said, The acquisition by the Tatas has added firepower to Natsteel that will enable the company to rapidly build up market shares in steel consumption in the Southeast Asian construction industry.
Mr TV Narendran deputy president of Natsteel Asia said, The Asean market for steel is estimated to be around 40 million tonnes a year with long products, the exclusive portfolio of Natsteel, accounting for 55% of this market. However, the demand from the Singapore construction industry which was once valued at Singapore $18 billion to $20 billion has shrunk to Singapore $11 billion but is now beginning to look up.
NatSteel Asia was acquired by TATA Steel in 2005 has plants in Singapore, Malaysia, Thailand, Vietnam, the Philippines, Australia and China. It is mostly makes steel products for the construction industry and offers value added products for this segment like cut and bend reinforcement bars, wire mesh and prefabricated cages also.
ABG Shipyards net surges by 42.8% in Q2
ABG Shipyard has reported a 42.8% jump in its net profit for July to September 2006-07 to reach Rs 27.1 crore as compared to Rs 18.9 crore in July to September 2005-06. Its income in Q2 of 2006-07 was Rs 167.9 crore up by 47.45% YoY as against Rs 113.9 crore in Q2 of 2005-06.
Mr Rishi Agrawal CMD attributed these results to higher output and reduction in costs due to large number of similar ships being built at the shipyard had driven growth during the quarter.
The company has since 1990 delivered 93 ships of various types. Thanks to the boom in the ship building industry, the company has an order book position of 48 ships valued at Rs 2,382 crore.
Dr Muhkarjee calls for de integrated approach for steel facilities
Dr T Mukherjee deputy MD of Steel while speaking at SBB Steel Markets Asia 2006 in Bangkok recently said that India is as one of the more interesting investment destinations in steel sector due to its low cost of production and outlined the philosophy of de integrated production, having steel production facilities close to raw material sources and rolling mills in distant places, an approach opposite to traditional integrated steel mills.
Dr T Mukharjee informed that the raw material cost of hot rolled coil in India was $116 per tonne last year $63 less than in Korea and $82 less than in Taiwan and that an industry publication has projected that raw material cost of hot rolled coil in India would decrease to $114 per tonne, making it $81 less than the cost in Korea and $101 less than in Taiwan. Dr Mukherjee attributed the significant cost differences to the fact that India used more locally sourced raw materials while the other two Asian countries depended on imported ores for steel production.
Mr Mukherjee said steelmakers could acquire producing and casting plants in countries rich in raw materials either by consolidation or direct investment. He said any steelmaker should choose between pride of self reliance in steel or enjoy a sustainable high standard of living and urbanization through consolidation.
Haldia Dock to transfer land to WB government
It is reported that the Haldia Dock authorities propose to transfer to the West Bengal Government about 76 acres of land out of a total 6,367 acres in its possession at Haldia to facilitate rehabilitation of a number of families by the local administration.
Onex to Buy Steel-Services Firm Tube City IMS for C$240 Million
Onex Corporation, Canada's biggest buyout firm announced today that it has agreed to acquire Tube City IMS Corporation, a leading provider of outsourced services to steel mills, in a transaction valued at approximately Canadian$720 million.
Tube City IMS, operating at 66 steel mills throughout the U.S., Canada and Europe, through its Tube City and IMS Divisions, provides raw materials procurement, scrap and materials management, and slag processing services.
The acquisition is subject to customary conditions and is expected to close early in 2007.
Onex is a diversified company with annual consolidated revenues of approximately $19 billion and consolidated assets of approximately $15 billion. Onex is one of Canada's largest companies with global operations in service, manufacturing and technology industries.
Teck Cominco to start zinc shipments from Australian mine 1Q '07
Canadian miner Teck Cominco Ltd expects zinc shipments from its 50:50 Australian JV with Xstrata, Lennard Shelf mine restart towards the end of the first quarter in 2007.
Teck Cominco in its report of third quarter and nine months results said "Mill start up is anticipated in January 2007 with the first shipment of zinc concentrate expected near the end of the first quarter in 2007.
Teck Cominco said that the Pillara mine, which is part of the Lennard Shelf complex, has an anticipated mine life of four years at an annual production rate of 70,000 tonne to 80,000 tonnes per year of zinc in concentrate.
Stelco cuts steel production followed by slump in demand
Steel facing a heavy slump in demand stelco has slashed steel production for the first time in 16 years. In situations it is wise to cut production than to cut prices.
Mr Rodney Mott, Stelco CEO said that there is no point in putting out steel if there was no demand for it. But he said he is optimistic that it will pick up again.
Stelco is not ruling out further shutdowns. However, the shutdown does not mean layoffs. Workers are being given training courses or early holidays.
Nickel gains most in one week after demand outpaces supplies
Nickel prices gained most in one week as a result of increased demand, thereby creating a shortfall. The demand is expected to increase further this year.
Prices of nickel in three months on the LME gained $495, to $30,800 a ton yesterday. That's the largest one-day gain since Nov. 2.
It is reported that the Nickel supply shortfall will be more than 35000 tonnes this year. Global production of high nickel content stainless steel increased by 13% till now this year.
Lundin & EuroZinc complete merger
Lundin Mining and EuroZinc Mining announced recently that the merger between the two companies was finalized and that the merged company Lundin Mining Corporation is now listed on the Toronto Stock Exchange, the Stockholm Stock Exchange and the American Stock Exchange as of November 1 006. Lundin Mining and EuroZinc had announced the merger plans on August 21st 2006.
Mr Lukas Lundin will continue as chairman of Lundin Mining Corporation and Mr Colin K. Benner will be vice chairman and CEO.Mr Karl-Axel Waplan will be the president and COO and operate from Stockholm.
Lundin Mining Corporation will operate four profitable mines in Sweden, Portugal and Ireland and a fifth mine is planned to start production in Portugal in 2007. Production for 2006 on a combined basis is estimated to be approximately 180,000 tonnes of contained zinc, 90,000 tonnes of contained copper, 45,000 tonnes of contained lead and 6 million oz of contained silver.
Mr Colin K Benner CEO of Lundin Mining said "We expect to move quickly to take advantage of our development and exploration prospects and as well to evaluate other growth opportunities around the world."
Nippon Steel Asked To Build Facility In Indonesia
Indonesian Government asked Nippon Steel to build a factory, which will produce steel for automotive and electronic industry as import for the commodity reaches to $1 billion per year.
Mr Fahmi Idris, Minister for Industry said that it was very important as steel industry in Indonesia is not yet able to produce special type of steel required by automotive and electronic industry.
On an average each car requires 200 Kilograms of special steel. In 2005, car production demand surpassed 500,000 units. While local demand may only reach 310,000 units, the export market may increase, requiring production to reach more than 400,000 units.
Peruvian Minsurs Q3 net surges due to higher tin prices
Peru's only tin miner Minsur posted third quarter 2006 net profit of 171million soles ($53.2 million) rising from 107 million soles in the year ago quarter. Its net sales reached 273 million soles during Q3 up from 227 million soles while operating profit increased to 178 million soles from 143 million soles YOY.
Minsur said that the increase in sales revenue was due mainly to higher sales volume, while higher tin prices were also a factor. Metallic tin accounted for 98% of sales, it added without providing production or sales tonnage figures.
Minsur has the Funsur smelter and refinery operation in the southern coastal city of Pisco department, as well as the San Rafael tin mine in Puno.
Reliance Steel gets new financing
Reliance Steel & Aluminum Co. in a press release said that it received a new, five-year unsecured revolving syndicated credit facility of $1.1 billion that may be increased to up to $1.6 billion at the company's request with approval from the lenders. The banking syndication with 15 banks was led by Bank of America.
Reliance reported that the Company used funds from the new credit facility to fund the repurchase by Earle M. Jorgensen Company of its 9.75% senior secured notes due 2012 tendered pursuant to its previously announced tender offer and consent solicitation, and for working capital and general corporate purposes, including acquisitions, capital expenditures, debt repayments, dividend payments and stock repurchases.
The new credit facility replaces the Company's existing $700 million credit facility and its $100 million short-term credit facility.
Reliance Steel & Aluminum Co., headquartered in Los Angeles, California, is one of the largest metals service center companies in the US. Through a network of more than 160 locations in 37 states and Belgium, Canada, China and South Korea, the Company provides value-added metals processing services and distributes a full line of over 90,000 metal products. These products include galvanized, hot-rolled and cold-finished steel; stainless steel; aluminum; brass; copper; titanium and alloy steel.
Nippon Steel to setup a CH Wire Manufacturing Company in Thailand
Steel Nippon Steel Corporation has announced the establishment of a cold-heading steel wire production company in Thailand with the capital of 700 million pounds and capital investment of 1850 million pounds. The company is named Nippon Steel Bar and CH Wire (Thailand) Co Ltd. The manufacturing unit will produce approximately 40000 tonnes per year after it goes into operation around July 2007.
Nippon Steel Corporation following studies in overseas manufacturing of special-steel bar and wire conducted by NBC Company Limited, a business planning company founded in August this year, has reached an agreement with Mstubishi Metal Industry Co Ltd, Miyazaki Seiko Co Ltd, Sanyu Co Ltd, Toyota Tsusho Corp, Metal One Corp and Suzutoy Seiko Co Ltd for the joint establishment of a cold heading steel wire manufacturing and sales company.
Till now NSC has been manufacturing and selling cold-heading steel wire, a material for fasteners that are important safety parts for automobiles in Thailand, via TSK Wire Co Ltd. To meet future growth in demand in Thailand, it has been decided to seek an expansion of production capacity by establishing a Thai company. There is also an aim to product wire confirming to strict quality requirement and highly specific delivery terms in the country. As a consequence, TSK Wire's current business of cold heading steel wire has been scheduled to transfer to the Thai company.
Inco Indonesia shares higher on takeover news and nickel price
INCO Indonesia was bullish in midmorning trade on market speculation that CVRD will make an offer to buy the stock of its minority shareholders after company completed the acquisition of INCO's parent company Inco Ltd.
Last week CVRD announced that it had acquired 75.66% of Inco Ltd's shares for $16.8 billion. The gain in stock price was a combined reaction of a surge in Nickel price and the takeover to be followed by a tender offer for INCO Indonesia's minority shareholders.
Algoma Steel announces TSX approval of new normal course issuer bid
Algoma Algoma Steel Inc. today announced that it has received regulatory approval from the Toronto Stock Exchange to initiate a new normal course issuer bid. Under the terms of the bid, Algoma may purchase for cancellation up to 3,165,414 of its common shares, representing approximately 10% of its public float of common shares. As of November 1, 2006, there were 31,896,358 Algoma common shares issued and outstanding and a public float of 31,654,142 Algoma common shares. The purchases may commence on November 13, 2006 and will terminate on November 12, 2007, or on such earlier date as Algoma may complete its purchases pursuant to the Notice of Intention. Algoma will make the purchases in accordance with the rules of the exchange, and the prices that Algoma will pay for any common shares will be the market price of such shares at the time of acquisition. Algoma will make no purchases of common shares other than open-market purchases. Algoma has previously purchased (i) 5,479,452 common shares by way of a substantial issuer bid that expired on September 14, 2006 and (ii) 2,832,500 common shares by way of a normal course issuer bid that expired on August 7, 2006.
Algoma believes that, from time to time, the market price of its common shares does not fully reflect the value of its business and its future business prospects. As a result, Algoma believes that its outstanding common shares may represent an appropriate and desirable use of its available funds.
Better steel prices support CSN's Q3 results
CSN reports that the Brazilian steel market was better than most rest others in Q3. Sales in the domestic market increased 20% YOY and increased by 0.8% QOQ. Steel prices in Brazil increased 8% in the quarter, compared to 6% abroad.
In last 9 months of 2006, CSN shipped 2.98 million tonnes of total flat-rolled products, compared to 3.39 million tonnes during the first 9 months of 2005.
CSN's average third-quarter price of hot-rolled coil was Real$1,361 per tonne in its home market, and Real$1,320 per tonne for hot-rolled coil in the export market.
Despite of the healthy pricing, Q3 net income of Real$334 million declined 18% from Q2 net of Real$409 million. It was decreased by 35% from Real$517 million YOY.
Chelyabinsk Steel Sheets profit dip by 66.7% YoY
It is reported that net profit of Chelyabinsk Steel Sheet Plant went down by 66.7% in the third quarter of 2006. The companys net profit went down from 7,187,000 RUR in the second quarter to 2,404,000 RUR in the third quarter of 2006.
This was affected by the drop in sales and increase in the expenses including those connected with the growing railroad shipment tariffs.
Steel industry calls for clarity on sustainability guidelines
More than 200 members of the international steel industry have called on the South African government and world leaders to work on defining guidelines that would give decision makers greater clarity and more measurable goals when pursuing sustainability.
The call came through a unanimously accepted resolution at the Steel 50 conference of the Southern African Institute of Steel Construction. The conference was held in Sandton on 8th and 9th Nov.
Dr Hennie de Clercq, SAISC executive director said that they are committed to the concept of sustainability, including avoiding over exploitation of the earth's resources, minimizing harm to the biosphere and ensuring a quality of life for every human being.
Dr. De Clercq also said that the problem was, while the relevant construction professionals including architects, engineers and steel contractors want to act in a manner that promotes sustainability, they were not only unsure of what to do but also of how to measure the success of their actions against objective criteria. Unless governments do this it could have a seriously damaging effect on the environment.
Tenaris to spend up to $70 on newly acquired Maverick Tube Corp
Tenaris SA plans to spend between $50 million and $70 million on its recently acquired Maverick Tube Corporation in near future.
Tenaris manufactures pipes for oil exploration projects and has been planning to improve its product mix that will include higher end tubes. Tenaris is owned by Argentine conglomerate Techint.
