AITUC calls for reversing duty on iron ore export

It is reported that the All India Trade Union Congress has demanded withdrawal of the export duty of INR 300 per tonne on iron ore levied by Mr P Chidambaram the union finance minister in his budget recently and has decided to make representations to the prime minister, the union finance minister and other concerned authorities accordingly

Mr Cristopher Fonseca general secretary of AITUC while addressing a press conference said that the proposal to levy the duty should be withdrawn and should be substituted with a rational proposal without deviating from the principles set out by the Hoda Committee.

Mr Cristopher Fonseca said that the duty will force mine owners to cut back on their production which will eventually adversely affect and cause loss of revenue to the railways, port, truck transporters, truck industry, barge industry, earth moving machinery and mineral processing suppliers and operators.

Industry report also point that during last few days most of the mining majors along with politicians from mining areas have met ministers and other concerned officials and the general feeling is that the guidelines would soon be revised to limit export tax only on higher grades of iron ore.

Kalinga Nagar blockade to continue for now

Kalinga Times reported that the initiative that started for lifting of the road blockade agitation by the tribal of Kalinga Nagar in Jajpur district of Orissa on Monday ran into rough weathers on Tuesday as Visthapan Virodhi Janmanch did not accept the chopped off palms of five of the 13 victims of the last year's police firing after they found that the cause of death of all the firing victims had not been mentioned in the death certificates.

Mr Rabindra Jarika secretary of VVJ said The collector has betrayed us by providing death certificates of the firing victims without mentioning the cause of the death.

In addition, Mr Rabindra Jarika secretary of VVJ sent a letter to Mr Naveen Patnaik chief minister of Orissa stating that they would take appropriate steps for lifting the blockade only after they received a written confirmation from the chief minister's office about stopping of all activities of TATA Steel in Kalinga Nagar.

Visthapan Virodhi Janmanch had on Monday agreed to consider lifting the road blockade agitation during a meeting with the District Collector and other officials.

The state government has been making efforts to persuade the tribal to lift the road blockade agitation as the High Court has fixed March 9th 2007 as the deadline for removing the road blockade agitation from the Daitari to Paradip national highway near Kalinga Nagar. The road blockade agitation has been continuing since last year's police firing in which 13 tribal were killed in firing by police and their hands were chopped.

Karnataka HC calls for preserving iron ore for future

The Karnataka High Court has called for a comprehensive policy by the union and state governments on the export of iron ore in order not to waste iron ore that could be utilized in future. The honorable court said that the indiscriminate manner in which iron ore was extracted in the state and elsewhere may lead to its non availability for future generations and if they become scarce it would have to be imported at higher costs.

Justice Mr Huluvadi G Ramesh while disposing a petition by Kudremukh Shram Shakthi Sanghhatana of Mangalore has directed the governments to consider, if they review the mining policy, an application by the Sanghatana for grant of mining lease in Ramadurga area in Bellary district.

The Sanghatana had earlier moved to the court seeking a direction to the state to pay compensation to KIOCL in case mining lease in 1,573 hectares in Ramadurga area could not be granted to it.

Service tax to make CILs outsourcing expensive

It is reported that Coal India Ltd has assessed a budget impact of INR 1,000 crore due to imposition of service tax on outsourcing activities as outside agencies are likely to pass to pass back this component back to CIL, which can not pass on this to its consumers and will have to absorb the burden.'

CIL which produces about 80 % of the country's coal outsource nearly 150 million tonnes of coal production against its annual production of about 360 million tonnes. Additionally, 100 cubic million tonnes of overburden removal is also outsourced.

POSCOs project unlikely to meet planned progress

Statesman News Service reported that Orissa governments efforts to bring normalcy in Dhinkia, Govindpur Patana and Trilochanpur panchayats, where POSCOs proposed steel plant is to come up, are facing many hurdles as some of the leaders abstained from the peace talks initiated by the district administration.

One of the Anti POSCO leader set a pre condition for attending the meeting by saying that the only if the administration first assured them that the proposed steel plant project work would be stopped, they would sit for talks.

POSCOs project, which has been inordinately delayed, has entered a critical phase as 13 month action plant has reportedly been worked out by project authorities and certain pro active measures initiated. But it is likely that the ground level work would not progress as per targets set during the three month period as there is no end to the opposition in sight.

Thermal coal import into Gujarat to surge in future

Times News Network has reported that the huge investments lined up in coal based power plants in Gujarat will propel coal imports by almost 300 % over the next 4 to 5 years and that Gujarat will import over 50 million tonnes to 55 million tonnes of coal annually through its ports as against current imports of less than a million tonnes.

The report cites some experts in the port sector as saying that Coal imports in Gujarat will go up dramatically in coming years. Not only will the captive users import more coal, all weather ports too will have to expand capacities to be able to import more coal.

Infrastructure companies like TATA Power, Videocon, Torrent Power, GSPC and Visa Power are also bracing for the opportunity in coal imports into port development in Gujarat. Adani Group, which owns and manages Mundra port, is already in the process of setting up 2 coal berths for catering to the demand from ultra mega power projects. In addition other players are also likely to expand their coal import facilities.

DGMS provides provisional mine accident statistics

As per information furnished by Directorate General of Mines Safety under Ministry of Labor & Employment, the number of private mines is 4045 and the number of accidents reported during last three years is given below

The owner, agent and manager of each mine is required to comply with provisions of Mines Act, which is over seen by the officers of DGMS and in case of non compliance, action as per law is taken against the mines management.

This information was given by Dr T Subbarami Reddy the Minister of State in the Ministry of Mines in a written reply in the Rajya Sabha.

L&T & Toshiba mulling power equipment JV

It is reported that Larsen & Toubro is in talks with Japan's Toshiba Corporation for setting up a JV in India to manufacture power plant equipment. The report cites a L&T official confirming that the discussions are at a preliminary stage for setting up a facility for making turbines for power plants.

Nikkei reported that L&T would hold majority stake in the joint venture, which will invest about USD 173 million to build plants for steam turbines and power generators with aim to have an annual turnover of JPY 20 billion in five years.

L&T's recent tied up with Japanese power equipment major Mitsubshi Heavy Industries for manufacture of boilers for power projects, where it plans to invest INR 450 crore.

ABARE forecast firm nickel prices in 2007

Australian Bureau of Agricultural & Resource Economics forecast world nickel prices to rise by 52% on year to an average of USD 36,750 a metric ton in 2007 on demand growth and supply constraints.

It added that world nickel consumption is forecast to rise 5% YoY to 1.46 million tons in 2007, led by increased demand for stainless steel, especially in China and India.

On the supply side, the report notes that labor disputes in the nickel industry have been a common feature over the past few years and will remain that way, as high nickel prices strengthen the bargaining position of unions.

The report added that even in 2008, prices may remain high, despite some slowing in demand and some increase in mine output, as stocks would still remain low.

USs YTD crude steel production down by 7.1% YoY

American Iron & Steel Institute reported that USs domestic raw steel production in the week ending March 3rd 2007 was 1.981 million net tonnes while the capability utilization rate was 84.8% as against 2.126 million net ton with capability utilization of 89.5% in the same period of previous year.

The current week production represents a 6.8 % decrease from the same period in the previous year. Production for the week ending March 3rd 2007 is up by 1.0 % from the previous week ending February 24th 2007 when production was 1.961 million net ton and the rate of capability utilization was 83.9%.

Adjusted YTD production through March 3rd 2007 was 17.305 million net ton at a capability utilization rate of 82.2 % which is a 7.1% decrease from the 18.637 million net tonnes during the same period last year when the capability utilization rate was 87%.

AISIs estimate is based on reports from companies representing about 75% of the USs crude steel capability.

Chinas export rebate cut likely to be announced

Mr Zhu Jimin chairman of Shougang Group said that China would soon unveil new tax policy about calling off rebates on export of some steel varieties. Mr Luo Bingsheng deputy director of China Iron & Steel Association has also suggested the same.

A well informed source said the new export tax rebate will most probably come out during March 16th to April 31st so that the new policy is very likely to take effect as of April 1st.

The source further disclosed that new export rebates for common carbon CRC and HRC might be cut to zero, while that on some special products like alloyed steels could be 5% or 8%.

Export is regarded the largest uncertainty of China's steel market. Once the rebate is cut further, Chinese steel makers will face higher cost and lower profit, then inevitably the resources backflow to home. On the other hand, long and flat products will diminish on the overseas market and the price would go higher.

(Sourced from Mysteel.net)

Cape Lambert & Portman ink iron ore exploration deal

Cape Lambert Iron Ore Ltd announced that it has signed an agreement with Portman Iron Ore Ltd to explore and develop iron ore resources on five properties located in the Evanston region near Portman's Koolanyobbing operations in Western Australia.

Under the agreement, Cape Lambert, which holds the iron ore rights on these properties, will receive royalty of 1.5 % of average per tonne value for iron ore products removed from here.

Portman will spend a total of AUD 1 million on exploration within three years to earn 100% of the iron ore rights with a minimum of AUD 300,000 to be spent in the first year.

Mr Ian Burston chairman of Cape Lambert said The agreement will enable the company to focus on the evaluation and development of its magnetite project near Karratha in the Pilbara of Western Australia.

US based iron ore pellet producer Cleveland Cliffs owns about 80% of Portman.

Xstrata posts strong results for 2006

Xstrata Plc announced that its it made a net profit of USD 4.89 billion, accounting for three recent acquisitions as if they had been part of the group since the start of the year. Its net income in 2006 advanced to USD 1.95 billion on a consolidated basis up by 14% YoY as compared to USD 1.71 billion in 2005.Its sales more than doubled to USD 17.6 billion.

Xstrata made three big acquisitions in 2006 one third of Colombia's Cerrejon coal operation, Peru's Tintaya copper mine and Canadian miner Falconbridge and benefited from a boom in demand for metals, with copper prices surging around 40% in 2006 and nickel soaring around 250%.

Mr Mick Davis CEO of Xstrata said The Company is well geared to benefit from the rising commodity prices by virtue of the acquisitions that we've done over the last five years.

Xstrata said in a statement "While it is unlikely that average prices for base metals will continue to rise at a similar rate in 2007, the fundamental outlook for the industry remains positive. The rapidly industrializing economies of China and India and the satisfactorily performing economies of the older Asian tigers and Europe will continue to drive demand growth for metals and energy, despite an underperforming US economy."

Xstrata Plc is 35% owned by Glencore International AG.

Ryerson postpones shareholder meet

Ryerson Inc has postponed its annual meeting, saying that it needed more time to review a possible sale of the company or other options, actions that met with criticism from an activist shareholder.

Ryerson Inc said it would put off its May 11th meeting because the board believes it is in the best interests of all stockholders to conduct a comprehensive and thorough process of examining its future plans before the meeting. It did not announce a new meeting date.

Ryerson Inc had announced last month hiring of an investment bank to review strategic alternatives including considering a sale of the company, a business combination, a recapitalization or a share repurchase.

The company has been the target of investor Harbinger Capital Partners, which owns 9.7% in Ryerson and has vowed to replace the firm's board members with its own nominees. Harbinger is seeking the election of seven independent directors to replace the majority of Ryerson's board.

Mechel Targoviste commissions continuous caster

Mechel has announced the commissioning of a new continuous casting machine at its Romanian steel plant Mechel Targoviste and said that the new unit will allow Mechel Targoviste to significantly reduce production costs and improve the quality of its long products. The investments in the continuous caster reconstruction and infrastructure amounted to approximately USD14 million.

The design productivity of the new 3 strand concaster is 500,000 tonnes of billets annually. The new machine has replaced the plant's obsolete concaster. The unit is capable of producing billets of 120mmx120mm, 140 mmx140 mm and 150 mmx180 mm sections from various grades of steel. The commissioning of the new continuous caster allows for the casting of practically all grades of the plant's product mix, including low-alloyed and alloyed steel. The equipment was manufactured by CONCAST and installed by the Romanian specialists under the supplier's supervision.

Mr Alexey Ivanushkin COO of Mechel said "With the commissioning of the new concaster, Mechel Targoviste becomes one of the most modern European steel producers. The radical reconstruction of steel production at this facility, has allowed the plant to improve its operational and financial performance. Mechel's management demonstrated again its capability to transform an obsolete, unprofitable production facility and adapt it to a highly competitive market environment. We are proud of the results achieved at Mechel Targoviste, our principal Romanian enterprise, and are currently focused on the financial turnaround of another asset, Mechel Campia Turzii.

Mechel has invested a total of more than USD 38 million in Mechel Targoviste since acquiring it, having significantly exceeded its obligations under the investment contract, which was closed earlier than required in late 2006.

ABARE forecast zinc price increase in 2007

Australian Bureau of Agricultural & Resource Economics said that the prices of zinc are expected to increase 7% YoY to an average of USD 3,500 a metric ton in 2007 as demand continues to outstrip supply for the fourth year in a row and that there may be a further drawdown in global zinc stocks.

The report added that toward the end of 2007 zinc prices in real terms may fall as increased production from mining projects such as San Cristobal in Bolivia boosts supply. It said increases in global output in 2007 will come from a number of mine expansions and new projects.

The report added that a lot of the new zinc mining projects are being developed in countries with relatively high sovereign risks, such as where operating rules or taxation arrangements may be altered after a project has started.

Baotou Steel & Arcelor Mittal talks end

Reuters reported that China's 12th largest steel mill Baotou Iron and Steel Group has ended talks with Arcelor Mittal on selling a stake. Mr Lin Donglu chairman of Baotou Steel told Reuters that "We are not talking about any actual cooperation anymore."

Mittal Steel began talks with Baotou to buy a stake of as much as 49% prior to its acquisition of Arcelor.

Arcelor Mittal already holds a stake in Hunan Valin Steel Tube & Wire although the other announced purchase of stake by Arcelor in another steel mill has been put on hold by the Chinese Government.

Bushwick Metals acquires Koons Steel

US based steel distributor Bushwick Metals has completed the acquisition of Koons Steel Inc on March 2nd 2007 and the new company will be called Bushwick Koons Steel. Mr Frank Koons III will continue to manage the operations.

Founded in 1935 by Mr Frank Koons Sr, Koons Steel Inc is a general line steel service center located 40 miles west of Philadelphia, in Parker Ford, Pennsylvania. Their extensive inventory includes wide flange beams, pipe, tubing, and flat roll products, plus numerous galvanized mini mill products. Value added services include saw cutting, shearing, flame cutting, cambering, and bending.

Mr Rick Perlen president of Bushwick Metals said that "We are extremely excited about this acquisition. Koons brings us a very talented group of employees, strong leadership, and a solid reputation within their marketplace. Their recently constructed facility is perfectly located to expand our presence into the Southern New Jersey Pennsylvania, and Delaware markets. Combining Koons' competencies with the additional product lines that Bushwick and AZCO avails will create a superior resource for steel consumers in this territory."

Mr Frank Koons III owner of Koons Steel said that "Adding our services and relationships to Bushwick's inventory, capital and marketing expertise creates a formidable company. Our primary focus will continue to be quality and service. The benefits of this union for our valued customers and employees will be seen immediately."

Marmon Keystone Corporations subsidiary Bushwick Metals is a distributor of carbon and stainless steel structural, plate sheet, bars, tubular steel, decking and specialty products with corporate headquarters at Butler in Pennsylvania.

Hyundai Steels integrated steel plant on schedule

South Korea's No 2 steelmaker Hyundai Steel Co announced that construction of its 8 million tonne per annum integrated steel mill at Tangjin in South Chungchong Province is progressing as per plan. Hyundai started building the steel mill in 2006 and expects to complete it by 2011. Mr Park Seung-ha president of Hyundai Steel at a press conference in Seoul said We are 25% complete. The site, which is twice as big as Yoido in Seoul, for two big blast furnaces will be finished by the end of this year.

So far POSCO is the only company that has a crude steel making capability in South Korea and Hyundai has been running its existing factories with electric arc furnaces. Hyundai Steels hot rolled coils will be delivered to Hyundai Steels sister firm Hyundai Hysco, a maker of automotive steel and steel pipes, for the production of value added steel sheets for automobiles, which will be supplied to Hyundai Motor and Kia Motors.

Hyundai Steel has chosen Paul Wurth as the preferred bidder for the development of core parts of Hyundais two blast furnaces at KRW 50 billion to KRW 60 billion and the contract is to be finalized by the end of this month.

Hyundai Steel said that it will fund half of the KRW 5.24 trillion projects with its retained earnings and borrow the remainder from investors such as Kookmin Bank HSBC and Standard Chartered Plc.

Hyundai Steel is the steelmaking arm of Hyundai Motor Group which owns South Koreas two largest carmakers Hyundai Motor Co and Kia Motors Corp.

Rio to fast track Simandou iron ore project in Guinea

Rio Tinto aims to bring its Simandou iron ore project in Guinea to production as quickly as possible in order to meet strong demand of iron ore from steelmakers.

Mr Alan Smith VP of Rio while addressing a CRU conference said that Rio is fast tracking a pre feasibility study into developing the project into a mine and building transport links required to bring product to the world markets. He said ""Early indications are, Simandou is a very large, very high grade iron ore resource."

Rio Tinto expects demand for iron ore to continue to grow, both in world's biggest steelmaker China and other markets, particularly India. Mr Smith said The fundamentals of steel demand support continued strong growth.

Vallourecs 2006 net up by 93.9% YoY

World leader in the production of seamless steel tubes and tubular products for specific industrial applications Vallourec announced its 2006 results. The consolidated financial statements were presented by Vallourec's Management Board to its Supervisory Board, chaired by Mr Jean-Paul Parayre.

Its consolidated sale for 2006 increased by 28.7% YoY to EUR 5.541 billion. EBITDA rose by 57% YoY to EUR 1.665 billion, giving a record EBITDA to sales ratio of 30.1% as compared with 24.6% in 2005.

In EUR million

Mr Pierre Verluca chairman of the management board stated "Benefiting from its strong positions in the buoyant energy related markets, Vallourec had an outstanding year in 2006. Further growth is anticipated in 2007 and Vallourec is expected to maintain a very high level of operating profitability. Our confidence in these prospects, combined with Vallourec's very good financial health, has prompted us to propose a sharp increase in the shareholder return while at the same time preserving sufficient room for maneuvers to pursue our selective growth investments."

In the oil and gas sector, Vallourec achieved strong sales growth in America and the rest of the world thanks to the combined impact of very strong demand, the increased proportion of premium products and increases in the selling prices of certain products. In the US, Vallourec also benefited from the expansion in combined sales of premium tubes and joints. However, the downward inventory adjustments observed at American distributors dampened growth a little at the year end. Vallourec also benefited from the acquisition of OMSCO and of SMFI (tubes and drilling accessories), both of which were successfully integrated and have started to generate industrial and commercial synergies.
Sales by market

In EUR million

Taiyuan & Sinosteel ink iron ore supply agreement

Interfax has reported that China's largest stainless steel producer Taiyuan Iron and Steel Group Co Ltd has signed a strategic partnership agreement with one of China's largest iron ore traders Sinosteel to supply iron ore for its new stainless steel production line.

A TISCO official told Interfax that since opening the new production line, the amount of self sourced iron ore has dropped from 80% to under 50%. He said "We used to purchase iron ore from local mines in Shanxi province, but due to a growing raw material demand, we require a more stable iron ore supply from a competent company.

TISCO's new stainless steel production line has an annual production capacity of 2 million tons and started operation in October 2006. The final stage of the project is a cold rolling line, which is scheduled to start operating in the first half of this year.

Usiminas 2006 net dip by 36% YoY

Brazilian flat steelmaker Usinas Siderurgicas de Minas Gerais SA reported net profits of BRL 2.52 billion (USD1.18 billion) for 2006 down by 36% YoY from BRL 3.92 billion in 2005. Its net revenues came in at RBL 12.4 billion down by 5% YoY as compared to BRL 13 billion in 2005, while EBITDA slipped by 21% YoY to BRL 4.37 billion.

Usiminas said in a statement that the fall in 2006 earnings reflects lower average steel prices and the negative impact on exports of the appreciation of the real against the US dollar, among other factors.

Usiminas sales volumes rose by 8% YoY to 7.95 million tonnes in 2006 and crude steel production increased by 1% YoY to 8.77 million tonnes.

Mr Rinaldo Campos Soares CEO of Usiminas said "It was a year of challenges and much work. Once again, the Usiminas System ended another year achieving significant results. Even in the face of an adverse scenario of high interest rates and a tax burden that limits investments in the Brazilian economy, we achieved our objectives and the consistent results in 2006 are proof of this.

Belos Horizonte based Usiminas and S Paulo based subsidiary Cosipa have combined installed capacity of 9.5 million tonnes per annum.

TMK acquires stake in Russian Research Institute for the Tube and Pipe Industries

Russian pipe major TMK announced that it has acquired a controlling stake in OAO RosNITI, Russian Research Institute for the Tube and Pipe Industries. RosNITI located in Chelyabinsk and founded in 1961, is Russias only scientific research institute specializing in pipe production technology.

Following the acquisition, TMK intends to create a central corporate scientific and technology research centre by integrating RosNITI with the Companys existing research functions. The centre will consist of the Russian Research Institute for the Tube and Pipe Industries and the research divisions of the Companys plants laboratories. The centre will be managed by the TMKs scientific and technical council, which is chaired by TMKs Vice President and Chief Engineer Mr Leonid Marchenko.

Mr Konstantin Semerikov, CEO of TMK said As TMK implements its strategic investment program, it is totally committed to the principle of aggressive scientific and technical development. TMK pays particular attention to the development and implementation of leading edge technologies which not only meet todays quality standards but are also designed for the future, keeping ahead of the demands of customers.

Timken expands round bar capabilities

Timken Company announced that it has further expanded its rolled carbon and alloy steel round bar capabilities and can now produce a maximum diameter of 15 inches. The additional capabilities are the second expansion of the size range in less than a year.

Mr Rick Brown director of advanced product and new business development for Timken's Steel Group said "The technological advancements that make this new 15 inch product line possible are part of our strategy to bring new and differentiated product solutions aimed at improving our customers' performance. These larger diameter, longer bars help reduce handling by our customers and are part of our drive to continually deliver dynamic steel solutions tailored to our customers' growing needs."

Timken can roll 13 inch, 14 inch and 15 inch round bars and can produce them in lengths up to 27 feet 23 feet and 20 feet, respectively and announced a USD 60 million expansion to enable it to competitively produce small bar steel down to 1 inch in diameter

Rolled bar is used to produce parts for applications such as rolled rings, forgings, gears, bearings and valves for users in the industrial, energy and bearing markets.

AK Steel announces surcharges for electrical and SS for April

AK Steel has advised its customers that a USD 230 per ton surcharge will be added to invoices for electrical steel products shipped in April 2007.

AK Steel's surcharges are based on reported prices for raw materials and energy used to manufacture the products, with the February purchase cost used to determine the April 2007 surcharges.

China to ban new low capacity coal based power plants

Shanghai Securities News has reported that the Chinese government plans to ban for new coal power generators with a capacity below 300,000 kilowatts which are built solely for the purpose of power generation.

Mr Chen Deming vice chairman of the National Development and Reform Commission said that new power generators should be equipped with facilities to desulfurize emissions and to reduce soot emissions.

The new policy aimed to address the problems of excessive consumption and pollution of the sector as greater capacity meant higher efficiency with less energy consumption and less pollution. Official statistics show that 35% of the total sulfur dioxide emissions and 52% of the total soot emissions of the sector came from coal based power generators with relatively small capacities.

Many 300,000 KW coal power generators were built in the 1990s, but have since been largely replaced by 600,000 KW generators. Coal based generators with a capacity of one million kilowatts were put into operation last year With the development of the sector the country's installed power generation capacity exceeded 600 million kilowatts in 2006 sharply reducing the number of power blackouts.