A long week for Indian iron ore miners

During last week Indian iron ore miners are trying out all avenues for effecting a reversal, partial or in full or Fe content based, for the recently imposed tax on export of iron ore by the Indian government. Several delegations comprising of iron ore miners and state politician have met senior officials and ministers in this attempt.

Mr Shantaram Naik MP from Goa met Dr Manmohan Singh prime minister of India last week and demanded that the export duty of INR 300 per tonne on iron ore exports, proposed to be imposed by the finance bill 2007 by Mr P Chidambaram the union finance minister, be withdrawn. Mr Ravi Naik president of Goa Pradesh Congress Committee met Ms Sonia Gandhi president of All India Congress Committee and presented her a memorandum highlighting the likely effect of the proposed export duty on iron ore on the Goas mining industry and the states economy.

Eastern Zone Mining Association has sought immediate withdrawal of export duty levied on iron ore fines of all grades. In a letter to Mr Chidambaram EZMA said What we understand that Hoda Committee had recommended imposition of duty on +65% iron ore lumps and not on iron ore fines as there is no domestic demand within the country. And moreover, any imposition of export duty on iron ore fines will have a detrimental effect as the entire industry will come to a grinding halt.

There have been several unconfirmed reports of vessel cancellations over the last week and statements from some of the Chinese buyers that they will stop buying Indian iron ore but it is highly unlikely that Indian government would reverse this announcement. However, there could be a slim chance of qualifying the export tax only on higher grades of iron ore.

On the other hand, some industry insiders said that as the global iron market is firm, some of the Chinese buyers are likely to accept increase in prices this week and that the response during last week for a price increase has not been absolute negative. They said that, if it happens, the market will come back to normal quickly, but the major effects would be loss of shipments during this period, which would be difficult to make up due to infrastructure constraints and vessel availability and that as such season is coming to an end.

Another observation has been that the impact of this tax would be more pronounced for smaller exporters as payment of export tax would require additional finances.

Coal group formed for overseas investments

ET reported that the Indian government has decided to acquire coal mines in Zimbabwe, Mozambique, Australia, Indonesia and South Africa.

The report said "A dedicated group, headed by coal secretary, has been constituted in the ministry of coal to plan for investments in coal mines acquisitions abroad including Zimbabwe, Mozambique, Australia and Indonesia." This coal group is expected to work from the infrastructure created by Coal India Limiteds Coal Videsh Department.

As per report, a team from the department has already visited Mozambique, Zimbabwe and South Africa to explore and identify prospective coal business opportunities. Indian government is also involved in discussions about the possibility of joint coal mining with other coal producing countries and a MoU has been signed between the India and Mozambique government to promote and expand bilateral relations in coal resources.

ASSOCHAM welcomes export tax on iron ore

ASSOCHAM has welcomed the move of imposition of export tax on iron ore and has called for further measures for conserving the country's natural resources. It said that iron ore security is vital as a developing nation like India.

Mr VN Dhoot president of ASSOCHAM said "Our endeavor should be to discourage export of any raw materials and rather strengthen our manufacturing base to generate employment opportunities and create wealth for the Indians.

ASSOCHAM said that the proposed duty is expected to generate INR 3,000 crore every year, which should be utilized for long term exploration and expansion needs of the domestic industry.

Jharkhand HC asks for time frame for R&R Policy

Jharkhand High Court has directed the Jharkhand state government last week to file supplementary affidavit stating the time frame by which it would prepare the State's Rehabilitation and Resettlement Policy.

A division bench comprising Chief Justice M Karpagavniyagam and Justice NN Tiwari, dissatisfied with the counter affidavit filed by the State Government regarding its R & R Policy, observed the state had submitted a vague statement giving no time-frame regarding its completion.

The State Government submitted that it was preparing a scheme for rehabilitation of those who would be displaced by the different companies that have signed MoUs with the state for setting up new projects. It also submitted that the scheme would be advertised throughout the State.

CILs CCL opts for security cover in Jharkhand

SNS reported that Coal India Limiteds Central Coalfields Ltd is opting for a paramilitary security cover during its upcoming as well as extension projects in Jharkhand due to the growing threats of extremists and the deteriorating law and order situation in the state. The report mentions that CCL management is extremely dissatisfied with the quality of security cover provided to their coalfield by the state police. As per report, the union home ministry has already given its go ahead for deployment and movement of forces in remote and far flung areas will be completed in the next three months.

Mr Ajay Kumar director personnel CCL said "Disturbance by anti social elements in loading and transportation of coal has become a major headache for us in the CCL. On 9 March, we faced problems in Piparwar coalfields while loading. Moreover, there are always threats of extremists trying to overpower the security cover we have in our magazine houses, where all the explosives needed for mining activities are stored."

CCL has planned for a major expansion of its ongoing projects in Jharkhand. The North Karanpura area in Chatra district will be the focus of this drive. New projects at Magadh and Amrapali sites are also being developed rapidly.

MSTC plans backward diversification

It is reported that MSTC Ltd is in process of restructuring its business model for greater risk management for sustained growth. Mr Malay Sengupta CMD of MSTC told media "We have achieved remarkable growth in terms of turnover and profitability growth during the last few years which were highest in the history of the company. Now we want to consolidate and diversify for backward integration as part of our future plans.

Mr Sengupta outlined the following areas where MSTC is increasing its presence

1. Coal blocks in Jharkhand, West Bengal and Orissa, for which MSTC has already applied and is looking for a JV partner
2. Applying for iron ore blocks.
3. Acquisition of minor stake in a private steel plant for assured business of supplying raw materials.
4. It is already in talks with some domestic logistics company and hope to finalize the details and partner by 2007-08.
5. MSTC is also creating a warehousing facility at Haldia for bulk and specialized cargo.

MSTC' is currently engaged in importing and marketing of coal, scrap and ferrous metals. It is also selling coal on behalf of Coal India Ltd through e-auction.

MCL starts Bhubaneswari open cast coal mine

Coal India Limiteds Mahanadi Coalfields Limiteds Bhubaneswari open cast coal mine has began functioning last week. The mine has an annual capacity of 20 million tonnes and the coal available in the mine is of F power grade.

Three coal projects namely Bhubaneswari, Kaniha and Kulda under MCL were given approval in 2005 but only Bhubaneswari has been started. The opposition by the villagers of Zillinda ended recently after MCL sanctioned 202 jobs to those affected.

With this project, the number of open cast mines under MCL has gone up to 16.

Indian billionaires club overtakes Japan

Forbes has recently published the latest list of billionaires worldwide. Mr Bill Gates of Microsoft continues to be the richest person in the world for 13th year in succession with a net worth of USD 56 billion, among the list of 946 billionaires prepared by the magazine.

But Indians are marching toward the top of rankings, with 14 new entrants this year, throwing Japan out for Asia's top spot with 36 billionaires worth USD 191 billion as compared with Japan having billionaires 24 worth a combined USD 64 billion. The list includes 31 resident Indians and 5 non resident Indian.

Mr Mukesh Ambani has taken the top slot in the category of resident Indians.

Steel baron, Mr LN Mittal with USD 32 billion fortunes, ranks 5th globally. The list of non resident Indians is as under

SECL to set up 1000MWlant at Raigarh with NLC

It is reported that South Eastern Coalfields Ltd is setting up a 1000MW power plant at Raigarh and two coal washeries at Raigarh and Kusmunda.

Mr VK Sinha CMD of SECL said that the Raigarh plant would be set up in collaboration with Neyveli Lignite Corp and that its capacity would be expanded later.

Mr Sinha also said that SECL would two coal washeries under the next five year plan at Raigarh and Kusmunda. He said "The Raigarh washery would have a capacity of 5 million tonne, A small power plant will be run with the help of reject coal from Kusmunda coal washery."

SECL has produced 79 million tonne of coal during April 2006 to February 2007 and expects to end the 2006-07 year with 88.5 million tonne.

NTPC ranks top in MoU Award for Excellence in Performance

Navaratna public sector undertaking NTPC Limited has been ranked as on top for Indian governments Department of Public Enterprises instituted "MoU Award for Excellence in Performance" for 2004-05 and 2005-06 with "Excellent" rating.

Dr Manmohan Singh prime minister of India presented the MoU Awards to Mr T Sankaralingam CMD of NTPC at the Conference of Chief Executives of public sector undertakings recently held in New Delhi.

NTPC has been achieving "Excellent" rating under the MoU signed with Govt. of India for all the years since inception of the MoU system and has sustained high level of operational and financial performance.

NTPC is India's largest power generation company with an installed capacity of 26,404 MW with 14 coal based, 7 gas based and 3 Joint Venture power stations and with 20% of all India's installed capacity contributes around 28% of country's power generation. NTPC is poised to become a 75000 MW plus Company by 2017.

The other Awardees in the category are HAL, PGCIL, NBCC, WAPCOS, CONCOR, RCF, HPC, REC, BHEL, STC, MSTC, NBCFDC and ECGC.

IRCON to lease & maintain locos for Thailand Railways

IRCON International, the public sector unit under the Ministry of Railways, may lease and maintain locomotives for the State Railway of Thailand.

Mr R Velu minister of state for Railways informed the Rajya Sabha that "The State Railway of Thailand has shown interest in the concept of leasing cum maintenance contract and a trial is scheduled to be held in March 2007 for running IRCON locomotives in Thailand.

Mr Velu also informed that IRCON is running meter gauge diesel/electrical locomotives on a lease cum maintenance contract to Malaysia since 1963.

Chinas 2006 crude steel production revised to 422.66 million

According to amended statistics released by the Chinas National Bureau of Statistics, China's crude steel production increased by 19.7% YoY to 422.66 million tonnes in 2006 and steel product output increased to 473.4 million tonnes up 25.3% YoY from 2005.

These new figures are about 1% higher than preliminary data released in January. Last month, the NBS said crude steel production had risen 18.48% to 418.78 million tonnes and steel product production increased 24.45% to 466.85 million tonnes.

According to the NBS, the annual growth rate of crude steel production for 2006 fell by 5.1 percentage points from the 24.8% growth rate in 2005 and down 7.5 percentage points from the 27.2% rate seen in 2004 due to a decline in fixed asset investment caused by stricter government policies.

China consumed 450 million tonnes of steel products in 2006 up by 17.2% YoY from the previous year.

CVRDs performance in 2006

Companhia Vale do Rio Doce while presenting its financial results for FY 2006, said that its market value increased by over USD 75 billion December 2001 and February 2007 with the total shareholder return in 2001-2006 reaching 42.7% per annum and that the remuneration paid to shareholders in the last five years amounts to USD 4.7 billion. CVRD is proposing the payment of USD 1.65 billion for 2007 representing an increase of 27% in relation to the USD 1.3 billion distributed last year.

Financial records

1. Gross revenue of BRL 46.746 billion
2. Consolidated exports of USD 9.656 billion, growth of 37.5% in comparison to 2005
3. Net exports, exports minus imports, of USD 8.784 billion 38.6% above 2005. CVRD contributed with 19% of the surplus in the Brazilian trade balance in 2006
4. Operating profit of BRL 20.089 billion
5. Operating margin of 44.4%
6. Cash generation measured by the EBITDA of BRL 22.759 billion
7. Net profits of BRL 13.431 billion ((USD 6.7 billion) up by 34% YoY as compared BRL 10.4 billion (USD 5 billion) for 2005
8. Investments of USD 26 billion, being USD 3.2 billion in organic growth, USD 1.3 billion in the support for the existing businesses and USD 21.5 billion in acquisitions.

CVRD had records production of iron ore 271.069 million tons, alumina 3.939 million tons, aluminum 0.550 million tons, copper 0.267 million tons, potash 0.732 million tons and kaolin 1.352 million tons.

In 2006, iron ore and pellets sales reached a new record, 272.682 million tons, exceeding the results verified in the previous year by 8.1% YoY. The iron ore shipments amount to 238.728 million tons, while pellets sales totaled 33.954 million tons. Manganese ore sales reached 0.779 million tons and those of ferroalloys 0.522 million tons. The revenues produced by ferrous minerals - iron ore, pellets, manganese and ferroalloys was BRL 27.635 billion, an increase of 10.9% in relation to 2005, when they reached BRL 24.926 billion.

CVRD became the largest iron ore supplier for China, where 77,873 million tons have been shipped to, with a growth of 37.8% in relation to 2005. CVRD was responsible for 23.2% of the Chinese imports, which represented 28.6% of its total sales volume as against 22.4% in 2005 and 19% in 2004.

Erdemir posts solid results under Oyak management

Turkish Armed Forces Pension Fund Oyak controlled Eregli Demir Celik Fabrikalari has announced the best consolidated financial statement of 10 years. Erdemir recorded a profit of YTL 684.9 million in 2006 an increase of 254% in profits in 10 months as compared to last year.

It's operating profit quadrupled compared to the previous year to become YTL 824.5 million. A new record has been set at final flat production with 3.903 million tons.

Quantity in million tonnes
Financial numbers in YTL million

Mr Coskun Ulusoy GM of Oyak & CEO of Erdemir's while speaking at a press conference last week in Istanbul said that his budget figures was the best answer to critics who were highly skeptical of their entry in to the sector 10 months ago. Mr Ulusoy said that they were able to save USD 110 million in 10 months by cutting several expenditures in administrative fields and introducing economy measures in the production process. He added that "We are planning a 20% increase in Erdemir's net profit this year."

Oyak purchased 46.12% stake in Erdimer for USD 2.77 billion under a privatization scheme 10 months ago.

Change in Chinese steel export taxes imperative

The rumors of export tax rebate cut or removal for steel exports has been circulating for a long period and there have been so many versions on specific range of adjustment. Though still in the air, the tax changes are imperative under the situation. It is clear that Beijing would announce the tax policy sooner or later. While the ever changing versions suggest the hard negotiations on specific extent of rebate cut between major steel makers and related department.

China's Iron and Steel Association confirmed last week that China would soon cut or remove tax rebates for some steel exports. Mr Luo Bingsheng vice chairman and secretary general of CISA, without disclosing the exact timing, told reporters It will be announced very soon." The chairmen of Shougang Group also expressed the similar view.

At moment, many steel makers choose to share half of the cost if the tax rebate changes and some even agree to assume all the loss themselves. While traders are more concerned about the availability of export allocations from steel makers than the announcement of tax policy given the robust overseas demand.

The underlined major reasons for the tax change are outstanding large exports and US leading overseas complaints to the World Trade Organization over the country's export subsidies. The earlier implementation of tax adjustment not only could show China's sincerity, but also could prevent the join of other countries on the complaint issue, giving relief to the possible trade frictions.

Under such circumstances, traders and steel makers seem not to be that anxious than before since they already have such expectations in mind for long enough. A Shanghai based trader, when asked about the influence of tax rebate adjustment, told MySteel "We believe the policy changes would only cast mild effect on the steel market. As far as the policy itself, it means nothing but higher export prices than before, which is known to everybody. Foreign customers also know the trend and steel prices are also slowly going up in overseas market. Regardless of the tax changes, steel exports would go on as long as importers could afford Chinese steels. But we are worried that steel prices would experience big drops or frequent fluctuations following the tax policy."

Another trader in expressed the similar idea. He expected China's 2007 steel products exports to be similar to the 43.01 million tones seen last year or slightly above that level as long as Chinese government does not control the momentum on purpose. He said "Of course it is easy for government to rein in the export volume with set of policies. In another word, the tax rebate change itself could only cast short-term effect on total export volume. Those suitable for export are bound to export, leading to a new balance at a new price levels."

In January 2007, Chinese steel product exports more than doubled from the year ago period to 4.38 million tones, although the exports were below the monthly record of 5.5 million tones in December 2006.

(Sourced from MySteel.net)

MEPS upgrades Asian steel prices forecast

MEPS reported that in the flat products category due to mildly positive sentiment and escalating input costs b, due to the underlying because of momentum of Chinese industrial production and construction demand being still good, the Japanese market becoming tighter as distributors' stocks of strip products fall, inventory overhang in the distribution sector in South Korea is taking time to clear and with Taiwanese market strengthening, it has upgraded its previous regional forecast and now predicts rising prices for several months ahead.

MEPS said that "We expect some oversupply to occur in China and South Korea during spring time. This could put negative pressure on selling values across the region to mid year and slightly beyond. The threat from Chinese exports could dull regional figures until the summer. As activity in the industrialized nations picks up further in the second half of this year we forecast a revival in the volume of Chinese exports to Western nations. This should take some pressure off the Asian markets and provide opportunities for price gains to near USD 600 per tonne for the MEPS Average Flat Products Price by the end of 2007."

MEPS however cautioned that the outlook is uncertain and heavily dependent upon the actions of the Chinese government in reducing the current export rebates available to local mills

MEPS concluded that "The threat of oversupply is likely to limit price gains up to mid year and into the weaker demand conditions during the summer months. Stronger export volumes from China as the producers target Western customers in the autumn, should take some of the pressure off regional prices in the second half.

Vallourec gives strong outlook for 2007

Seamless tube major Vallourec Group noted that demand looks set to remain upbeat for tubes for drilling and for equipping oil and gas wells as well as for products used in power plants in 2007 and that the slowdown in demand from China is offset by stronger demand in North America and Europe.

Vallourec said that in energy related markets, the Group's order books thus remain long at 8 to 9 months excluding the North American oil market. The outlook is also good in the mechanical engineering and petrochemicals markets. It added that Vallourec's plants can be expected to continue to operate at maximum capacity. There is likely to be a further gradual enhancement in the product mix while average selling prices are set to stabilize.

Vallourec said that, barring any unforeseen circumstances, it expects sales to continue to grow in 2007, an increase that it puts at around 7% to 10% excluding the impact of the planned disposal of its precision tubes activity. Vallourec expects its EBITDA/sales ratio to remain at a high level in the first half of 2007, although just below 30%.

It added that in longer term, the fundamentals of the oil and gas and power generation markets are expected to remain very robust. Oil and gas exploration and production conditions are becoming increasingly complex, thereby boosting demand for premium products. Likewise for the increasingly greater requirements for energy yields and reduction in CO2 emissions by power plants that call for increasingly sophisticated products.

Global slab trade in 2006 up by 19.2% YoY

Platts reported that Mr Georgy Eliseev head of analysis for Russian steelmaker Evraz, quoting Metal-Expert, Comtrade, Metal Bulletin, SBB, US International Trade Association, Taiwan Bureau of Foreign Trade, Mysteel.net and Tex Report, at the CRU 13th World Steel conference in Bonn said that quantity of steel slab traded globally rose to approximately 31 million tonnes in 2006 from 26 million tonnes in 2005. Mr Eliseev noted that the figures did not include merchant slab sales inside countries.

The country wise estimates for export of slabs by some of the major slab exporting countries in 2006 are as under

In million tonnes

Mr Eliseev said that among the Russian exporters, NLMK was the largest in 2006 at 3.85 million tonnes followed by Evraz which exported 3.397 million tonnes. In case of Ukraine, Azovstal was the largest with its export totaling 2.67 million tonnes followed by Alchevsk at 1.69 million tonnes.

LME to introduce steel contracts in 2007

Bloomberg last week reported that the London Metal Exchange plans to introduce steel contracts this year making it the world's first major exchange to offer trading in such products.

Mr Martin Abbott CEO said that the LME may start with index based steel contracts and those traded over the counter. He said it is fairly obvious that the steel industry needs a better way to manage its price risk.

Mr Abbott added that the exchange may start listing steel contracts in some form possibly using the over the counter platform as an incubator by the end of this year.

Australian thermal coal prices up by 5%

The Australian reported that Australias major thermal coal producers are achieving record price settlements with Japanese power companies in supply contract negotiations for 2007-08.

There is no firm annual price benchmark for thermal coal unlike contracts negotiated with Japanese and Chinese steel mills for iron ore and coking coal but it is reported that the big miners are currently winning contract prices about 5% higher than the levels achieved last year. As per report, both Xstrata and Rio Tinto have settled most supply negotiations with the 10 Japanese power utilities for the contract year starting April 1st 2007 at or above USD 55 FOB per tonne.

The USD 55 to USD 56 price range is a record and significantly better than had been expected earlier in the year when some forecasters were tipping flat prices or a drop of as much as 5%, but declining exports out of China, which is increasingly consuming its own coal spooked the Asian utilities and allowed Xstrata and Rio Tinto to stay firm on their price demands. In the last three years, China's coal export volumes have dropped by 47.3 million tonnes.

Steaming coal contract prices are now almost double their nominal level at the start of 2003. The settlement will boost the prospects for semi-soft coking coal prices that are now expected to be settled within weeks. Semi soft coal can be fed either into thermal coal markets or if processed further into the coking coal market. The thermal coal result is likely to mean semi soft coal prices will rise by 5% to 7% to USD 61 to USD 62 a tonne.

China's domestic steel product prices to increase in March

The Price Monitoring Center of Chinas National Development and Reform Commission said last week that China's steel product prices will continue to rise steadily in March due to an increase in consumption and as the exports are also expected to increase due to strong international demand. The center also believes that Baosteel's Q2 price policy will boost market confidence in the next few months.

According to Price Monitoring Centers statistics the average price for major steel products in China stood at CNY 4,055 (USD 523.9) per ton in February 2007 up by 1.74% from January and up 9.94% from February 2006.

As per the Price Monitoring Center the domestic price pattern is as under

Price in CNY per tonne
Changes are with respect to January 2007 and January 2006 levels

VIZ-Stal appeal on dispute with Elsib to be heard in April

Interfax reported that the Sverdlovsk region arbitration court has put its consideration of an action against the regional office of the Federal Anti Monopoly Service back from March 9th 2007 until April 9th 2007, brought by Novolipetsk Steels Yekaterinburg based subsidiary VIZ-Stal. The court held a preliminary hearing of the case on February 6th

VIZ-Stal is challenging a ruling and order issued by the regulator following a review of complaints that the steelmaker had violated competition laws in regard to Novosibirsk based Elsib Trading House. The regulator has ordered VIZ-Stal to fulfill the terms of a contract with Elsib Trading House, which last September filed a complaint with FAS.

Elsib claimed that VIZ-Stal was demanding that the trading house not only purchase the main product covered by a supply contract, but also remains from its production. Elsib said that under its contract with VIZ-Stal the steelmaker is supposed to supply steel sheet with a width of 750mm. But VIZ-Stal makes sheet in a standard size of 1000mm, so it wanted Elsib to also buy the leftovers. Elsib refused to buy on such conditions and said it wanted only the 750 mm sheet. VIZ-Stal refused and stopped shipping product altogether.

MMK produces 2.081 million tonne crude steel in 2 months

Magnitogorsk Metal Integrated Works has announced results of production activities in February and two months of 2007.

In February 2007, MMK produced 138,700 tonnes of finished ore, 787,100 tonnes of agglomerate, 401,300 tonnes of coke and 708,200 tonnes of cast iron. In February 2007, steel smelting totaled 959,800 tonnes, roll production totaled 924,400 tonnes and production of commodity metal products 876,300 tonnes.

During the first two months of 2007 MMK produced 293,900 tonnes of finished ore, 1.674 million tonnes of agglomerate, 2.081 million tonnes of steel, 2.010 million tonnes of roll and commodity metal products totaled 1.922 million tonnes.

Coal mine flooding kills 22 dead in Liaoning Province

Xinhua reported that at least 22 people were confirmed dead and 7 others went missing when a colliery in northeast China's Liaoning Province was flooded on Saturday night. The incident was reported at 8:44 PM local time in a pit of the Fushun Mining Group in Fushun, a capital city of Shenyang.

A source with the provincial safety watchdog said that 29 miners were working on platform No 73003 of the Laohutai Mine when the accident occurred. Search and rescue work started shortly after the flooding.

The 100 year old mine had been listed as one of China's 45 most dangerous coal mines because of a high risk of flooding, fire and gas leaks. The mine still employed 7,200 people and produced 3.35 million tonnes per year from its 160 million tons of proven coal reserves.

Metalloinvest appoints Hatch as its strategic development consultant

Russian leading mining and metallurgy player Metalloinvest Management Company has appointed Hatch an adviser to provide for turning the company into one of the leading players on the worlds metallurgical market. The objective is to elaborate a strategic development program for the holding which meets Metalloinvests plans to strengthen its positions on the local and foreign markets and which is based on the general trends of the global steel industry.

Mr Maxim Gubiev CEO of Metalloinvest said that "Given that Metalloinvest has been actively entering international iron and steel markets, the company requires modern international approach when defining strategic lines of company development and management. The expert support provided by Hatch will help us hit the target of boosting our competitiveness and taking leading market positions both in Russia and abroad."

Hatch is a leading global consultancy providing process and business consulting, information technology, engineering and project and construction management to the mining, metallurgical, manufacturing, energy and infrastructure industries.

Vessel delays at Australia forces South Korean utilities buy SA coal

Two South Korean power generators said they aim to buy coal from South Africa despite the distance and costly freight as utilities face delays from regular suppliers. An official at Korea South East Power Co Ltd said that it is also considering buying South African volumes as loading of supplies are being delayed in Australia.

KOSPO official said "South Korean ships usually have to wait in the ports in Australia for more than 20 days on average to be loaded. He said since the duration is longer than the travel time needed for African deliveries to arrive in South Korea utilities are encouraged to turn to South African coal despite higher freight."

Since the delay duration is longer than the travel time needed for African deliveries to arrive in South Korea, utilities are encouraged to turn to South African coal despite higher freight. As per reports, South African coal costs on average USD 53 a ton FOB as against Australian spot thermal coal prices of USD 53.25 FOB.

South Korea's five state utilities owned by Korea Electric Power Corp South East Power Co, Western Power Co, Southern Power Co, Korea East West Power Co and Midland Power Co used around 52 million tons of coal in 2006.

Steel barons of Ukraine

Forbes has recently published the latest list of billionaires worldwide. Mr Bill Gates of Microsoft continues to be the richest person in the world for 13th year in succession with a net worth of USD 56 billion, among the list of 946 billionaires prepared by the magazine.

There are 7 Ukrainians in the list for the year, and almost all of them from the field of steel & mining barons.

Taiwanese CSC to lift Q2 prices by 3.24%

Reuter reported that China Steel Corp Taiwan's biggest steel maker will lift Q2 domestic steel prices by 3.24% from the current quarter at the upper end of market expectations. The move follows increase in prices by Baoshan Iron and Steel Co.

The company however expressed caution about whether there would be any more increases in the second half of the year despite a rundown of high global stocks and strong demand in the United States and Europe.

Company spokesman Mr LM Chung told Reuters that "We decided on the increase to reflect a rise in international prices and amid higher freight and raw material costs. We are a little worried whether or not the second quarter will be the top. If we could maintain prices at the Q2 level, which would be quite good."

China Steel kept most prices flat in the first quarter, with an average increase of just 0.55%.

Siemens consortium to supply hoisting systems to Chinese coal mine

A consortium with Siemag GmbH Netphen and Siemens Industrial Solutions and Services Group has received an order to supply two high performance mine winder systems for the main production shaft of a new coalmine belonging to Shanxi Gaohe Energy Co Ltd China. The mechanical components will be supplied by Siemag while Siemens is equipping the facility with electrical components. The total value of the order amounts to around 9.5 million euros and the pit conveying systems are scheduled to start operating in the middle of 2009.

The goal is to equip the shaft with production winders and so achieve a hoisting capacity of 6 million tonnes of coal per year. They are characterized by a high throughput rate, high reliability and a long useful life. The hoisting capacity of an underground mine is significantly dependent on the performance of its winder system.

Siemens is supplying two high performance winder systems. The associated synchronous main motors have an output of 4000 kW at 50 rpm and will be equipped with DC link voltage converters of the type Sinamics SM 150. Each of the two production shaft hoisting systems is designed for an output of 1880 tonnes of coal per hour. The conveying system is powered by a 4 rope conventional winder which transports the coal in skips with a payload of 25 tonnes at a speed of 12 meters per second. The two winders are fitted with hydraulic disk-brake systems which, in an emergency, reliably bring the winder to a standstill at a constant rate of deceleration. In addition to the winder, the scope of supply includes the 4 rope deflection pulleys and the ropes itself.

Also included in the scope of supply are the power distribution systems and the automation equipment, including safety systems and cooling and ventilation systems for the motors and converters.

Stelco appoints Mr Pannell as director

Stelco Inc announced the appointment of Mr Derek G Pannell as a director of Stelco last week.

Mr Pannell is a metallurgical engineer with over 35 years of experience in the mining and metals industry. Mr. Pannell was the CEO of Noranda Inc and Falconbridge Limited from June 2002 to October 2006. Currently, Mr Pannell is a managing partner of Brookfield Asset Management Ltd and a director of Teck Cominco Ltd.

Mr Courtney Pratt chairman of Stelco said "We welcome Derek to Stelco and the Board looks forward to benefiting from his considerable experience."

Stelco is one of Canada's largest steel companies. It is focused on its two Ontario based integrated steel businesses located in Hamilton and in Nanticoke. These operations produce high quality value-added hot rolled, cold rolled, coated sheet and bar products.

Venture Steel achieves CPK5 designation for quality

Royal Laser Corp announced recently that its custom flat rolled steel processing facility Venture Steel Inc has been awarded the distinctive CPK 5 designation of quality control and capability. A CPK5 designation indicates that Venture Steel's fabrication line has been audited and proven to meet the strictest quality control specifications. A quality auditor gave Venture Steel a rating of 5 which equates to an error rate of less than one per million produced or virtually perfect.

CPK5 is the highest rating possible and meets the demands for the most sophisticated products in both the automotive and industrial steel sectors.

Mr Bill Iannaci Royal Laser's CEO said that" The quality and workmanship at Venture Steel as well as our other Royal Laser subsidiaries has been very well received by the marketplace. In spite of the recent slowdown in the North American domestic automotive industry and continue to be awarded a number of other contracts on an ongoing basis both in the industrial and automotive segments."

Venture Steel Inc is a custom flat rolled steel processor specializing in all types and grades of hot rolled, cold rolled and coated steel. Venture Steel operates out of combined facilities totaling 230,000 square feet located in the Greater Toronto Area of Ontario.