India increases steel production targets

Indian government announced that India would produce 175 million tonnes of steel by 2020 against 110 million tonnes envisaged in the National Steel Policy. The steel ministry has also revised the target for steel production from 65 million tonnes to 80 million tonnes by 2011-12.

Mr Ram Vilas Paswan union minister of steel while launching of a campaign by the Institute for Steel Development and Growth to promote usage of steel said that Our National Steel Policy envisages a production level of 110 million tonnes by 2020, but we are likely to achieve a production of 175 million tonnes by the same period. We have ensured a level playing field to all the steel manufacturers. Our aim is to grow.

Mr Paswan said As the average consumption of steel in India is only 38 kilograms as compared with world average of 170 kilograms, there is a huge scope for increasing steel production in India. We are confident of 80 million tonnes production by 2011-12.

He also added that private as well as public sector steel companies had signed as many as 156 MoUs with various state governments.

Mr RS Pandey secretary steel told newspersons that both production and consumption of steel had witnessed a growth of 10% to 15% in the past few years and this had lured a large number of investors for greater capacity addition. He said "Given a conducive policy environment, we should be producing 100 million tonnes of steel by 2015-16 and 200 million tonnes by 2020. We need to understand that China has turned into a net exporter of steel, which shall have implications for us. We have to be competitive against any kind of dumping.

Indian iron ore exports tussle intensifying

Indian steel makers have reported that levying an export duty of INR 300 on export of iron ore has failed to achieve its intended objective of checking exports as iron ore exports during March 2007 are expected to rise by nearly 35% as compared to the exports in February 2007, which is in sharp contrast to the public announcement by the Federation of Indian Mineral Industries which said the tax would lead to a closure of many small mines and hit exports by as much as 50%.

AS per ISA, data available with Indian Ports Association shows that exports in January and February stood at 9.74 million tonne and 9.45 million tonne, respectively and were 6.34 million tonne in the first 15 days of March. On a pro rata basis, it could go up to 12.69 million tonne, 34% more than the average exports in January and February.

On the other hand iron ore exporters have denied that exports surged by 34% in March 2007 and termed the steel industry's allegation as gross misrepresentation of facts. Federation of Indian Mineral Industries said "Exports in March are down by 33% over exports in March 2006 as against the claim of the ISA that exports have surged by 34%. It added that if 10% average increase witnessed in the first 11 months is taken into account, exports in March will be down by 40% only due to the levy of export duty on iron ore.

FIMI said that iron ore exports during March 2006 were 10.57 million tonnes while during the first twenty days of March 2007 it was 4.98 million tonnes.

Indian PM to inaugurate the Steel Summit 2007

Indias ministry of steel in partnership with the Confederation of Indian Industry is organizing Steel Summit 2007 India Vision 2020 Challenges Ahead at New Delhi on the March 26th to March 27th 2007.

Dr Manmohan Singh prime minister of India shall be the chief guest at the Summit and Mr Ram Vilas Paswan union minister of chemicals, fertilizers and steel will be the guest of honor.

Mr RS Pandey secretary minister of steel told media that the summit plans to bring together all the stakeholders from the government & industry and a host of international Speakers and discuss all the issues of concern, which need to be addressed in order to facilitate rapid growth of the Indian steel industry during the next two decades.

The releases adds that the key challenges that have to be overcome to facilitate the rapid growth of the Indian steel industry include
1. Availability of land & water and speed of land acquisition & rehabilitation
2. Raw material, mainly iron ore, power, coal & natural gas
3. Development of an enabling infrastructure
4. Environmental issues
5. Human Resource development
6. Research & development

Mr Pandey said that the summit will not only provide a forum for dialogue and information sharing but would also be a launching pad for a series of national initiatives required by the steel industry to increase its production capacities to globally competitive levels.

CCCMC lodges protest with Indian government over iron ore export tax

China Business News reported that Mr Yan Bangsong deputy director of the China Chamber of Commerce of Metals has recently handed over a letter expressing Chinese importers' concern over Indian ore export duties to Commercial Counsellor of Indian Embassy in China. Indian Commercial Counselor promised that he would pass the concerns to the Indian authority.

Mr Yan noted that Chinese buyers hope the price would be unchanged for all the contracts signed before March 1st 2007 and any price hike request would be unacceptable. Chinese importers would have to pay an additional USD 500 million as a result of Indian sudden decision to levy INR 300 per tonne export tax on iron ore and Indian ore imports would be far less attractive for Chinese buyers.

Chinese importers have showed strong resistance to Indian duties. CCCMC has gathered Chinese importers in Beijing to discuss response to Indian duties and all the participants either government agencies or CCCMC or importers have agreed to make their due efforts to lobby Indian authority to work out a more rational solution.

Indian export tax has also pushed up the ore freight rates. The latest data shows that both ore freight rates from Brazil and Australia to China have hit new highs up by 47.58% and 40% YoY respectively because most Chinese buyers have switched to Brazilian and Australian suppliers in response to Indian duties, and that has partially driven up the bulk cargo rates.

(Sourced from Mysteel.net)

India should allow iron ore exports after meeting domestic demand

Amid the ongoing lobbying by both Indian steel makers and iron ore miners, on the issue of tax and other measures to curb export of iron ore, steel ministry has desired that government should allow exports of iron ore only after meeting the needs of domestic steel industry.

Mr Ram Vilas Paswan Steel Minister union steel minister while interacting with newspersons after launching the nationwide Steel Promotion Campaign organized by the Institute of Steel Development and Growth said "I do not want to hurt the mining industry. But there should not be a situation where steel utilities are compelled to import iron ore to meet their production needs in future.''

He noted that the ore requirements of the steel producers would have to be factored in while taking any final decision. He said "Our iron ore export policy should be based on our domestic needs. Our consumption should be assessed and only after that exports should be allowed."

Sinosteel plans to setup 5 million tonne steel plant in Jharkhand

FE reported that Chinese Sinosteel Corporations subsidiary Sinosteel India Pvt Ltd is likely to sign a MoU with Jharkhand by May end to set up a 5 million tonnes steel plant in the state of Jharkhand. Mr Hongsen Wang MD of Sinosteel India told FE that We have already discussed our plans with Jharkhand chief minister and the state chief secretary. We are likely to sign a MoU within the next two months.

As per reports, the plant is likely to come up around Jamshedpur. However, the company is likely to set up the plant any where in Jharkhand depending upon the allocation of land by the Jharkhand government. Sinosteel will initially invest USD 500 million. The production capacity of the plant will be 1.5 million tones initially which will be increased to 3 million tonnes within 3 years and to 5 million tones within 5 years once the plant starts functioning.

Sinosteel India is also in talks with the West Bengal government to set up a metallurgical and engineering equipment plant in Haldia in West Bengal at an investment of USD 30 million. Mr Wang said that We want to set up a metallurgical and engineering equipment plant in India and are in advance stages of talks with the West Bengal government.

INSDAG launches steel usage promotion campaign

A 12 month long steel usage promotion campaigns, funded by the Ministry of Steel and all major steel producers of the country and coordinated by the Institute for Steel Development & Growth, has been launched by Mr Ram Vilas Paswan union minister for steel, chemicals & fertilizers. Mr RS Pandey secretary steel and MR SK Roongta chairman of Steel Authority of India Limited along with other steel industry leaders were present on the occasion.

Mr Paswan while speaking at a press conference to launch of this campaign said that the current level of steel consumption is quite low at around 39 Kilograms per person as compared to the global average of 170 kilograms. He added that the consumption of steel in rural India remains one of the lowest at 2 kilograms per person.

Mr Paswan said that the campaign to promote steel is basically to increase the use of steel from bridges and buildings to rural amenities. He added that steel is eco friendly and can be recycled easily.

Mr Paswan added that the public sector companies are increasing their number of stockyards and also the number of dealers at district level, which will help in reaching steel products to rural areas at affordable cost.

POSCO denies report of abandoning Orissa steel project

South Korean steel giant POSCO denied media reports about its proposed steel plant in Orissa and said that it has no immediate plans to drop the plant in India even as deadly protests against other projects cast doubt on their future.

A POSCO official told AFP "As of now, we don't have any intention to withdraw from India. We are definitely determined to continue with this project. We don't have any plan to withdraw in the near future. While repeating that the company intended to press ahead, the official also, without specifying a timeframe said that if we have to wait for much longer than we expected in India on the project then we might think of terminating at some point in the future.

Times News Network had earlier reported that POSCO is planning to shift its focus to Vietnam, where it is building a steel plant, as too many problems are dogging the POSCO project in Orissa. The report cited a POSCOs official as saying that both the centre and state governments have been desperately trying to push its case, but the situation is getting murkier. The official pointed out that The government is not able to enter the area though some portion of the estimated 4,000 acre required for the project has since been technically acquired and handed over. He said the Kalinga Nagar incident in Orissa and Nandigram and Singur episodes in West Bengal have only aggravated the problem.

In addition, Orissa High Court has stayed the government move of granting the mining lease to POSCO after the state owned Kudremukh Iron Ore Company Ltd challenged it on grounds that the mine was first offered to it and it has already spent over INR 2 crore on it.

Indian Railways freight traffic up by 9.12% YoY in 11 months

Indian Railways have generated INR 37653.17 crore of revenue earnings from freight traffic during April 2006 to February 2007 as compared to INR 32411.47 crore during the corresponding period last year up by 16.17% YoY. Railways carried 655.35 million tonnes of freight traffic during April 2006 to February 2007 as compared to 600.58 million tonnes carried during the corresponding period last year up by 9.12% YoY.

The earnings from freight traffic during the month of February 2007 was INR 3569.58 crore compared to INR 3180.98 crore during the corresponding period last year showing an increase of 12.22% YoY. Railways carried 61.67 million tonnes of freight traffic during the month as compared to 57.77 million tonnes of freight traffic during the corresponding period last year at an increase of 6.75% YoY.

Of the total earnings during the month of February 2007, INR 1386.23 crore came from transportation of 27.47 million tonnes of coal, followed by INR 318.34 crore from 3.70 million tonnes of food grains, INR 296.88 crore from 5.82 million tonnes of cement, INR 236.24 crore from 2.85 million tonnes of petroleum oil and lubricant, INR 224.14 crore from 3.24 million tonnes iron ore for exports, INR 159.15 crore from 2.70 million tonnes of fertilizers, INR 179.94 crore from 1.61 million tonnes of iron & steel for steel plants, INR 174.60 crore from 4.49 million tonnes of raw material for steel plants and INR 594.06 crore from 9.79 million tonnes of other goods.

SA Samancor imports chrome ore from India

It is reported that South Africa based the worlds largest ferrochrome producers Kermas Groups Samancor Chrome has begun importing chrome ore from India in response to a local shortage.

Dr Danko Konchar chairperson of Samancor Chrome said in an emailed statement that the first 700,000 tonnes were being unloaded at Richards Bay.

Global crude steel production in February up by 8.6% YOY

International Iron and Steel Institute reported that the total crude steel production in February 2007 for the 66 countries was 99.0 million tonnes up by 8.6% YoY as compared to February 2006.

The growth in crude steel production during February 2007 among regions was again led by Asia which registered growth of 13.6%, CIS (6), South America, Africa, European Union (27) also registered YoY positive growth of 11.5%, 10.4%, 10.4% and 7.2% respectively in February 2007. North America witnessed negative growth of 8.6%.

In million tonnes
Source IISI

Among the top 20 nations, China as usual stood first with 36.135 million tonne production of crude steel registering tremendous growth of 20.1% YoY as compared to February 2006. Ukraine and Brazil also registered YoY growth of 18.2% and 17.6% respectively.

In million tonnes
Source IISI

From 1 January 1st 2007, Bosnia-Herzegovina and Macedonia have begun to report their crude steel production figures to IISI. Figures for both countries are listed in the Other Europe region. This brings the total number of reporting countries to 66.

From January 1st 2007, Morocco has begun to report its crude steel production figures to IISI. Although Bulgaria does not report on a monthly basis, a monthly estimate based on the annual production figure has been included in the Other EU(27) category as The European Union expanded to 27 member countries with the addition of Bulgaria and Romania from January 1st 2007.

These countries represented more than 98% of world crude steel production in 2006.

BlueScope, OneSteel & Smorgon reach in principle agreement

Australias 3 steel majors OneSteel Limited, Smorgon Steel Group Ltd and BlueScope Steel Limited jointly announce that they have reached an agreement in principle, which will result in OneSteel and Smorgon Steel reverting to a merger by way of scheme of arrangement in a transaction consistent with the merger structure announced on 26th June 2006. The agreement was reached ahead of an expected ruling by the Australian Competition and Consumer Commission on a fallback plan OneSteel and Smorgon had proposed in December. OneSteel and Smorgon asked the regulator to postpone consideration of its back-up plan, pending the completion of due diligence by BlueScope on the distribution business.

The agreement involves the following interdependent elements

1. BlueScope would acquire Smorgon Steel's metal distribution business Smorgon Steel Distribution for an enterprise value of USD 700 million subject to satisfactory due diligence investigations on Smorgon Steel Distribution and satisfactory contractual negotiations and a formalised sale and purchase agreement. This process is expected to take approximately 2 weeks.

2. BlueScope will assume the position of acquirer and re supplier of scrap for OneSteel's Sydney Steel Mill, BlueScope and others.

3. Smorgon Steel would propose a scheme of arrangement with its shareholders by which OneSteel would acquire all of their shares in return for OneSteel shares and, possibly, some cash, on terms substantially similar to the scheme of arrangement announced on 26th June 2006. BlueScope would undertake to vote in favor of the Scheme and before the Scheme becomes effective OneSteel would acquire BlueScope's 19.98% stake in Smorgon Steel for a cash price equivalent to the value payable to Smorgon Steel shareholders under the Scheme.

The parties have a period expected to be approximately 2 weeks during which time they intend to conduct and finalise due diligence on Smorgon Steel Distribution and also to negotiate and finalise formal agreements for the acquisition. The new proposal, if formalised, would be subject to a number of conditions including approval from the Australian Competition and Consumer Commission and certain tax rulings.

The release adds that if the parties are unable to reach agreement by the end of that period or BlueScope is otherwise dissatisfied with the results of its due diligence investigations, the proposal and agreement in principle will terminate. In those circumstances, Smorgon Steel and OneSteel intend to continue to pursue their merger proposal announced on 18 December 2006 namely the acquisition by OneSteel of all of Smorgon Steel's businesses and assets, other than Smorgon Steel Distribution.

UBS is acting as financial adviser to OneSteel and Allens Arthur Robinson is acting as legal adviser to OneSteel. Goldman Sachs JBWere is acting as financial adviser to Smorgon Steel and Clayton Utz is acting as legal adviser to Smorgon Steel. Carnegie Wylie and Credit Suisse are acting as financial advisers to BlueScope and Mallesons Stephen Jaques is acting as legal adviser to BlueScope.

Russia starts charging AD duty on SS from EU

Interfax reported that Russia's 3 year anti dumping duty of EUR 840 per tonne on flat stainless steel with nickel content of 2.5% or higher imported from the European Union entered into effect on March 20th 2007.

Russian government passed a resolution on the duty on February 17th 2007 that entered into effect a month after its official publication in Rossiiskaya Gazeta on February 20th 2007 and will be charged between March 20th 2007 and March 19th 2010.

The Russian Economic Development and Trade Ministry started the anti dumping probe on October 27th 2004 based on a complaint filed by the Mechel steel group's Chelyabinsk Iron & Steel Works on behalf of Russian stainless steel producers which claimed that imported stainless steel was being sold in Russia for half its price on the EU market. The ministry in November 2005 recommended a duty of EUR 800 a tonne on stainless steel originating in the EU.

Esmark bids for Arcelor Mittals Sparrows Point steel plant

Chicago based Esmark Inc announced that it has submitted a bid to purchase the Sparrows Point steel plant from Mittal Steel. Mr Bill Keegan a spokesman of Esmark told The Daily Record that his company was one of a number of bidders for the mill.

The details that how much Esmark offered are not available but Mr Scott Burns a steel analyst with Chicago based Morningstar Inc placed Sparrows Points value at between USD 875 million and USD 1 billion.

Mr Burns said that Esmark is one of the few domestic buyers that would likely be interested in Sparrows Point as it is looking to expand its production capabilities after buying Wheeling-Pittsburgh Corp. But he added that With its direct ocean access, Sparrows Point is more desirable to foreign steel makers that need to import raw materials by ship. US steel producers tend to congregate around the Great Lakes and consider energy and labor costs prohibitively expensive on the East Coast. Foreign steel producers are really trying to get footholds in the US market.

Mittal Steel was ordered by the US Department of Justice last month to sell Sparrows Point steel plant to make sure that Mittal Steel does not have a monopoly over the US market for tin to overcome competition issues for merger of Mittal Steel with Arcelor. The Justice Department gave Mittal until late May to sell Sparrows Point with the possibility of a 60 day extension.

Sparrows Point employs about 2,400 and has the capacity to produce 3.6 million tons of steel per year of galvanized, hot rolled, cold rolled, semi finished steel and tin products for the construction and automotive industries among other users.

China may unveil new export rebate policy in April

Mr Zhang Guobao, deputy director of Chinas top planning body National Development & Reforms Commission while giving a speech at the China Development Forum 2007 disclosed that the steel export tax rebate policy which will cut on a part of the steel varieties is still being studied.

Mr Zhang said that China aims to reduce export and the trade conflicts and preserve world trader order by putting forth this new policy. He said with low per capita resource consumption like China sacrificing environment and resources for industries' development just resembles drain the pond for fish.

In order to curb export of high consumption and resource intensive products, the Chinese government has made a string of policy corrections, like expanding the list of varieties prohibited for trade processing, canceling export rebate for electrolytic aluminum, coke, ferroalloy, billet & slab etc and a varied rebate cut on 140 other steel varieties.

An industry insider disclosed that the government has planned to remove rebate on a part of steel varieties but is opposed by most steel makers as such a big cut might impact the sector severely. The policy is still being studied and is predicted to come out by end March or early April at latest.

Mr Luo Binsheng CISA deputy director has noted that the policy would be in sight and Shougang Group's GM Mr Zhu Jimin also confirmed and is ready to adjust export strategy in line with the new policy.

(Sourced from MySteel.net)

MEPS forecasts small increase in Q2 steel prices in EU

UK steel analysts MEPS are forecasting a small increase in steel prices for second quarter delivery in European Union. According to MEPS, most Q2 business is yet to be settled and a number of EU steelmakers have announced plans to lift April prices by around EUR 20 to EUR 30 per tonne.

MEPS said that Many customers believe the amounts to be too ambitious, given the availability of cheaper third country imports. However, the number of offers has declined recently and price wise, they are less interesting than at the end of 2006. In addition, there is a lot of uncertainty over whether and when the Chinese government will cut the export tax rebate.

In Germany, ThyssenKrupp has yet to formerly announce its Q2 target prices although producers have indicated that they want buyers to pay higher basis values, deals are still being finalized.

In France, demand is only average with stocks at normal levels. Arcelor will also make changes to its extras price list effective from April 1st. Service centers claim they cannot pass on the recent higher basis prices to their clients.

Q2 business is still not settled in the UK but buyers say they expect to pay more as there are fewer supply options now. Moreover, Chinese steel, booked three to four months ago is now arriving.

In Belgium, strip product values are moving up slowly as imported material becomes increasingly expensive. Service centre sales are very healthy and the Belgian economic outlook for the rest of 2007 is good.

Although most Spanish service centers had adjusted their inventories by the end of 2006, stocks are growing again with more non-EU material still to reach the ports. Consumers are keeping their stocks low.

CSN may build a Greenfield steel mill in US

Bloomberg has reported that Brazil's 3rd largest steelmaker Companhia Siderurgica Nacional may build a 4.5 million ton steel processing plant in the US to boost its share of the North America market.

Mr Luiz Migliora CEO of CSN during an interview said that the US Midwest or the South would be the most likely location for the processing plant and discussions are most advanced with Kentucky for a site located on the Ohio River. Mr Migliora said that Definitely, we have this in mind. We have done some investigations into Kentucky. This plant could be about 4.5 million tons. If you go for a Greenfield, you should look at this size.''

Mr Migliora added that Any new plant for CSN in the US would process steel slabs into other products but CSN hasn't decided yet whether to build the plant.

CSN is seeking facilities outside Brazil that can process its low cost steel slabs into finished metal products that yield more profit per ton and can avoid some trade barriers. The company is considering building a new plant after failing last year to win takeover battles for Wheeling Pittsburgh Corp and UK based Corus Plc. The company also may develop abandoned or idled plants or acquire an operating facility to boost growth in the US. CSN may also consider acquiring the Sparrows Point tinplate plant in Baltimore which Arcelor Mittal is selling to comply with a US antitrust decision.

Rosneft and TMK sign strategic partnership agreement

Russia based integrated oil and gas company NK Rosneft and TMK jointly announced that they have agreed to develop a long term strategic partnership. The agreement was signed in Moscow by Mr Sergei Kudryashov VP of Rosneft and Mr Konstantin Semerikov CEO of TMK. The partnership has been agreed for an initial period of 3 years with an option for an extension.

TMK and Rosneft will form a supervisory board to manage the venture, review ongoing strategy and make any necessary adjustments under the terms of the partnership.

The partnership will ensure optimal coordination of the design and production of new types of pipes supplied by TMK to Rosneft for use in the oil and gas industry both in the medium and long term.

Jinchuan warns overcapacity in nickel due to high prices

Chinas top nickel producer Jinchuan Group Ltd warned that oversupply could cause a crash in nickel prices in the next few years as crazy current prices encourage blind investment in nickel mines.

Jinchuan in a statement on its website said that "Such crazy gains in nickel prices have spurred irrational investments in the nickel industry the speedy development in nickel mines will lead to a rapid rise in supply when the projects begin commercial production in the next few years.

As per report International nickel prices reached USD 48,500 a tonne last Friday.

Evraz expresses condolences for Ulyanovskaya tragedy

Evraz Group SA has expressed its profound condolences to the families and relatives of miners who are victims of an explosion at the Ulyanovskaya coal mine. A company release said that The Companys employees share the sadness by this tragedy and mourn with all Kuzbass citizens.

Mr Alexander Frolov chairman and CEO of Evraz said that we would like to express our sincere condolences to the family of our colleague from IMC who also died in the explosion.

The release added that Evraz is fully cooperating with the management of Yuzhkuzbassugol in providing financial and social support for the families of the victims. Evraz employees have also expressed their desire to do what they can to help families of the deceased and injured miners, as well as to help mitigate the consequences of the accident.

Perus Volcan and miners reach agreement to avert strike

It is reported that workers at Peru based Volcan reached an agreement with management to avert a strike that was due to start recently.

Mr Gonzalo Cristobal Robles secretary general of the Volcan Mine Workers Federation and a company executive said they reached the agreement recently which met the concerns of workers who had feared their profit share would be reduced by the companys plan to reinvest earnings.

The union leader said the accord ensured Volcan, which operates 4 mines in Perus central Andes region would earmark 8% of its profits in 2006 in payments to staff from April 14th.

Volcan recently reported a nine fold increase in its Q4 net profit from the 2005 period due to surging zinc prices. Its 2006 net jumped to USD 238 million.

Technical failure ruled out in Kuzbass blast -Rostekhnadzor

Interfax citing Russian Federal Environmental Technology and Atomic Oversight Service reported that there are no technological flaws behind the explosion at the Ulyanovskaya mine in the Kemerovo Region. Mr Yevgeny Anoshin press secretary of Rostekhnadzor told Interfax that "All equipment is new, Rostekhnadzor inspectors regularly checked it. Service's inspectors entered the mine on March 6th for the last time."

According to Rostekhnadzor, the last comprehensive check of the Ulyanovskaya mine took place on March 7th to March 15th 2007. The safety rules awareness of the mine's management was tested at Rostekhnadzor's central office.

The commission has two theories for the explosion a possible landslide and a possible design error. The service's commission will begin its activity in the mine by Tuesday evening and will reach the scene of the explosion.

As per reports, Uzkuzbassugol has all the necessary licenses for mining surveys, for the use and stockpiling of explosives as well as the collection, use, neutralization and transport of dangerous wastes.

The Kemerovo regional department of the Russian Emergency Situations Ministry told Interfax that the blast occurred at 10.19 Moscow time on Monday and a total of 106 people died and 93 were rescued.

BGC wins Koolyanobbing iron ore contract

It is reported that BGC Contracting Pty Ltd has been awarded an USD 800 million contract for the mining, crushing and rail loading at Portman Ltd's Koolyanobbing iron ore mine in Western Australia. The 5 year contract starts on July 1st and runs for a period of five years.

As per report BGC Contracting takes over from HWE Mining Pty Ltd, which provides the same services under a contract finishing on June 30th.

BGC has provided a separate long distance haulage service to Koolyanobbing since 2004.

Koolyanobbing produces about 8 million tonnes of iron ore annually.

EU clears Arcelor SSC Slovakia acquisition by Gonvarri

Interfax has reported that the European Commission has announced that it has granted an approval for the acquisition of joint control of Arcelor SSC Slovakia by Spanish Holding Gonvarri and French Arcelor Steel Service Centers under the EU Merger Regulation.

The deal was examined under the EU's simplified merger review procedure cases which the commission believes do not pose competition concerns.

Arcelor SSC Slovakia is currently solely controlled by Arcelor SSC and operates a steel service center with sales in Slovakia, the Czech Republic and Hungary. Arcelor SSC is controlled by Arcelor.

Gonvarri is an international group operating steel service centers in Spain, Portugal, Italy, Germany, Poland, Mexico and Brazil.

China Overseas Engineering to study iron ore rail project for Yilgarn

Yilgarn Infrastructure Ltd announced that it have agreed to undertake a feasibility study on a proposed railway in Western Australia's Mid West region with China Overseas Engineering Corp a unit of China Railway Engineering Corp. The port and rail infrastructure will allow planned inland iron ore mines in the region to compete with mines in Western Australia's iron ore rich Pilbara region and Greenfield projects elsewhere in the world.

Yilgarn, which is backed by Australian private investors and pension funds as well as China Railway Commercial Corp and COVEC, also said that it expects to forge a second deal soon with another Chinese partner to carry out a feasibility study on a proposed new port at Oakajee 25 kilometer north of the city of Geraldton.

Mr John Saunders Yilgarn executive chairman said the infrastructure is vital to the growth of mines in the Mid West region. He said pre feasibility studies have shown that Yilgarn's plan for a rail network servicing all Mid West mines with guaranteed third party access is commercially attractive to each mine and the best option to ensure the region has an opportunity to realize its potential. He added that definitive feasibility studies are required by banks before they will extend debt finance and in order to secure equity funding commitments from Australian and Chinese investors.

Walsin Lihwa buys China precision wire rod operations

Taiwans leading aluminum manufacturer Walsin Lihwa Corp announced that its unit Shanghai Baihe Walsin Lihwa Specialty Steel Co Ltd has acquired the entire equity of China's Yantai Jin Cherng Precision Wire Rod Co Ltd for CNY 100 million recently.

Walsin Lihwa in a filing with the Taiwan Stock Exchange said that at the day of the purchase, the newly acquired unit in turn spent CNY 280 million to buy a block of operating assets, including land use rights, a plant and operational equipment from Yantai Huanghai Iron and Steel Co Ltd.

Evraz's takeover of NTMK delayed Report

RBC Daily newspaper reported that Evraz's plans to gain complete control of the group's core asset, Nizhniy Tagil Iron and Steel Works have suddenly been faced with difficulties.

As per report the Federal Financial Markets Service has demanded that Evraz should revise its offer to repurchase a 5% stake in the metallurgy company from minority shareholders.

Experts believe that Evraz will eventually be able to consolidate 100% of NTMK shares, though the process runs the risk of taking longer than expected.

Baosteel orders electro galvanizing line

Baosteel has ordered Andritz Group for supply of an electrolytic galvanizing plant for steel strip with an annual capacity of 300,000 tonnes per annum. Start up is scheduled for August 2008.

The project will be carried out in cooperation with the mechanical engineering and manufacturing companies of Baosteel, with Andritz assuming technological responsibility and supply of the main quality relevant plant sections.

This is the second electro galvanizing plant that Andritz will supply to Baosteel.

Review of 2006 and perspective of 2007 for Chinese steel sector

2006, in addition to being the year of mother of all mergers, was greatly influenced by happenings in the steel industry in China, which witnessed crude steel output increasing to 420 million tonnes. Chinese steel sector witnessed many happenings including some unexpected ones.

At the beginning of 2006, China steel market was covered by the atmosphere of productivity surplus, China steel price ran at low level, still mills saw high stock and most of them suffered profit loss, after great ups and downs in 2005, China steel market was still unstable in early 2006. Many global steel companies cut production and digested inventory, meanwhile driven by rapid global economy growth and the reestablishment stock, international steel price halted dropped and started to rise.

During 2006 China changed its role from a net steel import to a net steel exporter. When US steel price dropped after touching the peak, many industry insiders doubted the continuous growth in China steel export, while the fact is that China steel export reached 6.47 million tonne in Q1, 10.62 million tonnes in Q2, 11.51 million tonnes in Q3 and 13 million tonnes easing domestic market pressure. Despite of export jump Chinese mills faced price decline in H2.

Now, on one hand Chinese steel makers are facing threats if trade measures from various countries and on another their production of crude steel is forecast to reach 460 million tonnes in 2007, which is bound to result in surplus availability scenario. And the formost question is that how will the China steel market be in 2007?

Chinas leading steel information provider SteelHome has prepared an Annual Report which analyzes China steel market for 2006 and perspective for 2007. The report addresses the burning issues being faced by Chinese steel makers and covers construction steel, plates, HR, CR, coated products, strips, seamless tubes, section, SS, iron ore, scrap, coke and ferroalloys.

If you are interested to know more about it please visit http://www.steelguru.com/steelhome/steelhome_annual_report.php or send a mail at research@steelguru.com