SAILs SSP posts record performance in 2006-07

Steel Authority of India Limiteds Salem Steel Plant has posted a spectacular performance during 2006-07 with the highest ever annual sales of 199,544 tonnes and highest saleable steel production of 183,260 tonnes.

SSP has also achieved 34% growth in domestic stainless steel sales during 2006-07. The sale of carbon steel has also gone up by 13% to 130,869 tonnes which is also the highest till date while exports have gone up by 138% and the overall sales of stainless steel has also had an impressive growth of 60%.

During 2006-07, SSP has won several laurels and accolades in the fields of quality, safety and quality circle activities. In total SSP won 18 awards, ranging from Overall Best, Excellent and Distinguished Awards.
1. National Sustainability Award 2006 from the Indian Institute of Metals among secondary steel plants & alloy steel plants category for the tenth time in 15 years and for the 3rd time in succession.
2. It also received the Best Vendor Award for service excellence from Tata BP Solar India Ltd in Bangalore.
3. It has also received the Joint Committee for Safety in the Steel Industrys Ispat Suraksha Puraskars (Steel Safety Awards) for no fatal accident
4. Tamil Nadu State Safety Awards from the Inspectorate of Factories in Tamil Nadu
5. Two of Salem Steels employees won the Viswakarma Rashtriya Puraskar, a National Award under Class A Category from Govt of India 6. 3 employees were awarded the Uyarntha Uzhaipalar Virudhu (Best Worker Award) of the Tamil Nadu Government.

SSP is implementing INR 1553 crores expansion cum backward integration plan for new steel melting shop and continuous casting facility to produce 180,000 tonnes of stainless steel slabs per annum. Its existing cold rolling mills would also be augmented to a capacity of 146,000 tonnes per annum.

SSP has now set the bar higher for 2007-08 with a production and sales target of 140,000 tonnes of stainless steel and 180,000 tonnes of carbon steel products. Of this 84,000 tonnes of stainless steel has been planned for export.

Orissa Opposition seeks PM's intervention to avoid POSCO violence

KalingaTimes reported that 4 non Congress opposition parties of Orissa have sought the intervention of Dr Manmohan Singh prime minister of India to prevent any untoward incident in the POSCO project area in Jagatsinghpur district of Orissa as the state government seems to gearing up for use of force to acquire land for the POSCO project.

Communist Party of India (Marxist), Communist Party of India, Orissa Gana Parishad and Janata Dal (S) have submitted a memorandum to PM saying that Orissa government had created a war zone like situation in the project area by making heavy police deployment during the past few days.

The four senior leaders who signed the memorandum said that deployment of massive police force in the area where land had been designated for the Korean firm's proposed steel mill had triggered fear in the minds of the local who were against opposing the project. They said "Amidst tension, the villagers suspect that there could be tragic repeat of brutal action against them as happened earlier in Kalinga Nagar.

RINL to increase coastal movement for finished steel

Rashtriya Ispat Nigam Ltd has decided to continue the novel logistics route of sending its finished steel cargo in containers via the coastal shipping route.

Mr Y Sivasagara Rao CMD of RINL said that the companys test run in this regard by way of dispatching 1,000 tonnes of finished steel in containers to Kolkata via coastal shipments has proved to be immensely successful.

Mr Rao added that "We intend to move at least 200,000 tonnes to 300,000 tonnes in due course to the Western ports especially Kandla so that Mumbai, Headband and Japer are covered."

Orissa HC directs for hearing KIOCLs claim for Khandadhar iron ore mines

Orissa High Court, while disposing off a petition filed by Kudremukh Iron Ore Company Limited, has directed the central government to take an appropriate decision on the question of grant of prospecting license of Khandadhar iron ore mines to POSCO India. The court observed that the centre was the competent authority to decide on the matter and that the matter should be resolved preferably within three months after hearing claims of all parties, including KIOCL.

Effectively now, the centre has to hear KIOCLs contention for the mines before taking any decision on grant of mining license. The significance of the order stems from the fact that as per procedure, there was no scope for revision or hearing at the central government level once the state had made a special recommendation in favor of a particular company.

Orissa High Court had earlier ordered status quo on the issue after KIOCL filed a petition questioning the state government's recommendation to the centre that the prospecting license for Khandadhar mines be granted in favor of the POSCO India.

In their petition, Kudremukh authorities had termed the Orissa state government decision arbitrary saying that the mines in question had been committed to them previously. KIOCL had filed the petition on the basis of preferential rights for allotment of mining lease as it had applied since 2002 and had spent INR 2 crore when the directorate of geology took up prospecting work. The state Government, however, had contested the claim on the ground that the application of KIOCL had been cancelled before the POSCO India's case was recommended to the centre.

POSCO India has sought prospecting license for the Khandadhar mines to explore the reserve before applying for a formal mining lease for the same to extract iron ore for its proposed 12 million tonne per annum capacity steel plant in the state.

Welspun-Gujarat Stahl secures orders worth INR 1089 crores

Welspun-Gujarat Stahl Rohren Ltd announced that it has bagged prestigious pipeline orders worth INR 1089 crores (USD 250 million) for the supply of line pipes in India and Overseas. These projects are to be executed for both LSAW and HSAW Pipes.

Mr BK Goenka vice CMD of the Welspun Group said "Though our emphasis on Engineering Excellence we have demonstrated our ability to execute large and prestigious orders successfully. The new orders are testimony to the engineering ability that we have built in our Country."

These orders take the Welspun-Gujarat Stahl Rohren Ltd's current pending order book position to approximately INR 4,000 Crores, including the orders executed in the last quarter of 2006-07.

Anti POSCO threaten to use children as shield against police force

Reuter reported that Indian farmers opposing plans to take their land for POSCOs proposed steel plant threatened that they would use their children as shield to ward off police force if necessary. By deploying their children, the villagers hope to ward off the police who may try to enter the fields forcefully after the state government agreed to hand over disputed land to POSCO.

Mr Abhay Sahu of a local body formed to protest against the project said that "The children are our greatest strength. We have already started putting them near the barricades. About 70 children guard the nine gates in the morning. We will put them in the front if police come. They would be backed by women and youths."

A senior police officer in the district told Reuters that the villagers' decision to use the children was unfortunate. We will not allow them to do so.

Clashes between supporters and opponents of the project injured 50 people last month and protesters say a showdown with police could take place any time.

Captive coal & ore minors may sell excess output through CIL & NMDC

BL reported that a proposal is currently being examined by a Group of Ministers on mining policy, under which companies with captive coal and iron ore mines might be allowed to market production in excess of their immediate captive requirement and that in case the GoM approves the proposal to sell the excess production in the market, details such as royalty payment and rights over the mineral etc would be worked out later.

The report cites some official sources as saying that the proposal envisages that excess coal from the mines could be routed to the market through Coal India Ltd whereas in case of iron ore, the National Mineral Development Corporation will take the product to the market.

The proposal before the GoM emanates from an earlier move in the coal ministry to market the excess production from captive mines and this has now been revived to have a similar policy for iron ore as well.

The report also cites a source as saying that Another important point that remains to be decided is whether the companies having captive mines would be under any kind of obligation to exploit their resources in excess of their requirement so as to meet the increasing demand for coal and iron ore in the country. In the captive iron ore mines with steel companies and coal mines with steel, power and cement industries, normal mining operations yield a substantial amount of mineral in excess of the respective company's requirement.

Andhra CM plans a steel factory in Kadapa Report

Times News Network reported that Mr YS Rajasekhara Reddy chief minister of Andhra Pradesh is contemplating setting up a steel factory in his native district Kadapa in Andhra Pradesh.

According to report, the district administrations, has already identified over 8,000 acres of land for this purpose near Ambavaram in Jammalamadugu mandal and the chief minister is scheduled to hold discussions with district officials over the land allocation and other requirements for the factory. The report cites a senior government official as saying that "The identified land belongs to the government. There is no problem in allotting it, but water could be a major hurdle for the factory."

However, other officials said that it should not be a problem as sufficient water would be available in the Mylavaram reservoir since Krishna water from Pothireddypadu head regulator could be drawn through Galeru Nagari Sujala Sravanti project.

The proposed site near Ambavaram village is very near to the Renigunta-Gooty railway line, which will help in bringing iron ore for the proposed project from Bellary. Iron ore from Bellary is also being transported in hundreds of trucks everyday to Chennai port via Kadapa district.

Dr Krishnamurthy to examine NTPC's power equipment plans

BL reported that Dr Manmohan Singh Prime Minister of India has asked Dr R Krishnamurthy chairman of the National Manufacturing Competitiveness Council to look into the issue of the National Thermal Power Corporation getting into the manufacture of equipment for power generation.

NTPC proposal to enter into power plant equipment manufacturing has led to as stand off between the ministry of power and the ministry of heavy industries. The ministry of power feels that generation capacity addition in the 10th Plan fell short of target mainly because BHEL was not able to supply the equipment on time. On the other hand BHEL feels that low economy of scale at NTPC manufacturing ventures would lead to high cost of the equipment.

He said that the issue of transfer of technology of supercritical boilers had also been referred to him. NTPC placed the order for its 2x660 MW Sipat project on a Korean company called Doosan.

Dr Krishnamurthy is the former chairman of Steel Authority of India Limited and CMD of Maruti Udyog Ltd. He was also heading BHEL before.

L&T to start 3 manufacturing plants in China soon

PTI reported that construction major Larsen & Toubro, after commissioning its USD 11 million switch gear manufacturing facility, is all set to start operations at its other 2 plants in China by the end of this quarter.

Mr RN Mukhija president operations of L&T told reporters that "The company has already commissioned its switchgear manufacturing facility in Wuxi province of China while its plans to start operations at its valve and tyre manufacturing equipment facilities sometime during the present quarter. We are supplying coal gasification equipment to China and have already supplied machines worth INR 300 crore."

He said that L&T operates 5 broad businesses in China including sourcing raw materials and supplying coal gasification equipment including 3 manufacturing facilities.

China may take more steps to containing steel exports

On the second China Steel Import & Export Seminar held April 11th 2007 by Mysteel and China Logistics Information Center, Mr Qi Xiangdong deputy director of China Iron & Steel Association said that although existing steel rebates corrections have curbed the export to some degree but the effects are not enough and if the new regime issued April 10th fails to achieve anticipated results stricter measures may come up. Analysts believe that the stricter measures may include setting export qualifications and automatic license management system.

Mr Qi Xiangdong however said "Increase in steel export from China has actually filled in the global gap of demand, which is conducive to balanced supply and demand and price stabilization, easing of inflation pressure and extending the world's economic development cycle." Mr Qi said that huge steel export is not in line with China's industry policy, and the nation should continue with restrictive measures and keep the export volume at normal levels.

Mr Chen Haoran director of China Chamber of Commerce of Metals Minerals & Chemicals Importers & Exporters agreed on such conception but suggested that the importing nations accusation and antidumping moves are not wholly justifiable.

China exported 43.01 million tonnes of steel in 2006 accounting for around 9% of its total output. The export was up by 110% YoY from 2005, while imports of steel products dropped by 28.3% YoY to 18.51 million tonnes resulting in net steel product export of 24.50 million tonnes. In the first quarter of 2007, China's steel product exports increased 118.4% to 14.13 million tonnes.

(Sourced from MySteel.net)

Japan ferrochrome purchase price hits record high

Reuters, citing a Nippon Steel & Sumikin Stainless Steel Corp official, has reported that the term price for ferrochrome to Japan agreed between Samancor chrome and several other South African miners for April to June 2007 is up by 8.4% to a record high of 90 cents a pound from the previous quarter due to tight supply conditions.

The NSSC official said that "We've accepted a price hike in order to secure a sufficient amount of ferrochrome when we are facing supply tightness now. South African suppliers are increasing their capacity, but at the moment supplies are tight."

The official said a quantitative ceiling for exports of chrome ore from India have limited supplies of the raw material, which caused lower production of ferrochrome by producers such as China, which has resulted in pushing up the spot price and prompted suppliers to increase the price for the second quarter.

NSSC and suppliers conduct a review each quarter to set a term price for Japan. In the Q1 the term price was unchanged at the previous record high of 83 cents from the October to December quarter. The April to June price was almost 20% higher YoY.

Demand for stainless steel was strong as mills in Japan and others in the Asian region were running their production at full capacity based on bullish global economic prospects. Voracious demand for ferrochrome from China's rapidly growing stainless steel industry is stretching supply from South African ferrochrome miners.

Newcastle coal exports jump up by 25% last week

According to a Newcastle port official, coal exports from Newcastle port jumped by 25% to a two and half month high over the past week, despite record queues and longer waiting times.

The Newcastle Port Corporation data showed that its coal export terminal shipped 1.828 million tonnes of coal over the week up from 1.464 million the previous week and the highest since the end of January 2007. Coal stocks on hand at the Carrington and Kooragang berths rose to 912,385 tonnes up by 21,563 tonnes. Vessel queues at the port rose by a single vessel to a fresh record high of 72 ships. The average waiting time last week at the port also rose by nearly a day to a fresh high of 27.85 days.

The performance during last 11 weeks is as under

Shipped in million tonnes
Vessels arrived during the week
Waiting time in days
Stock in tonnes

The backlog is expected to return to acceptable levels by the end of June 2007, under the capacity balancing system which received initial approval in late February. The delays, caused by infrastructure constraints and maintenance work, have hurt exports of coal just as demand soars on world markets. Australia's New South Wales state government has approved plans for a new coal export terminal at the Newcastle port, to start operations in 2009 and add nearly two thirds to the port's capacity.

China to lead a surge in thermal coal prices

Thermal coal is poised to rebound from a two year slump as China is buying more to meet the increased needs of its power utilities which is increasing generation by 13% YoY by building new plants at record pace, thus increasing imports from Australia, Indonesia and Vietnam. China's purchases of coal in January exceeded exports by 1.4 million tonnes for the first time.

Annual coal contract prices in Asia may surpass all time highs in the next 12 months. Mr Mark Mobius of Templeton Asset Management Ltd in Singapore told Bloomberg that The coal sector in China has undergone a change. Asian coal prices may surge by 42% in five years. Mr Peter Richardson an analyst with Deutsche Bank AG in Melbourne predict USD 58 a metric ton next year and USD 59.5 in 2009, from about USD 55.5 for the year that started April 1st 2007.

Rising prices for thermal coal after oil would drive power costs higher and benefit mining companies but power utilities will pay more thus hurting profit. The increase in China's imports will help lift prices in Europe by forcing consumers to buy more from South Africa and Russia.

Chinese government's closure of unsafe and illegal mines that kills more than 13 people every day is adding to the pressure on coal prices. Regulators shut 8,300 in the two years through 2006 and plan another 1,700 shutdowns by year end.

China meets 78% of its electricity needs from coal fired power plants. China, which mines more than twice as much coal as the US, the next biggest producer, uses the fuel to generate 622 GW of electricity. Plants built in China in the last year alone generate enough power to supply the UK.

SDIs Q1 profit up by 34% YoY

Steel Dynamics Inc announced that its fiscal Q1 earnings were up by 34% due to higher shipments. Its net income for the quarter ended March 31st 2007 totaled USD 102.2 million from USD 76 million in the year ago quarter.

SDIs revenue also grew up by 30% YoY to USD 865.7 million from USD 665.9 million in the year ago period but earnings from its recently acquired Roanoke facilities were not included in the year ago quarter. Steel Dynamics shipments increased by 19% YoY to 1.3 million tons however operating profit per ton fell by 9% YoY to USD 136 from USD 150 in Q4 and market softness for flat rolled steel caused the Q1's average consolidated selling price to fall to USD 689 per ton shipped from USD 720 in the Q4.

Chinese coking industry focuses on tackling excess capacities

In 2006, the Chinese Coking Industry worked hard to carry out and fulfill a series of national guidelines and policies for the purpose of macro management including the Access Condition of Coke Industry. With the quality of economic growth and benefits fully improved, an important changeover from deficits for the industry as a whole to a steady and preferable development has been realized.

As demands have increased, the coke production continued to increase at a quick rate but the growth margin became smaller. In 2006, the total production volume of coke across China increased to 297.68 million tons with a YoY increment of 43.56 million tons and a growth margin of 17.14%, 6.11% points less year on year. The production volume of coke produced by mechanic coke ovens totaled to 262.79 million tons, the production volumes of semi coke, petroleum coke, modified coke and primitive coke added up to 34.89 million tons, which is slightly more than that of last year.

There appeared new changes to the structure of coke production, and the proportion of coke produced by iron and steel enterprises decreased. Coking enterprises above designated size across China produced 281.21 million tons of coke up by 17.64% YoY. All coking factories belonging to various large and middle key iron & steel complexes produced 91.10 million tons of coke with a YoY growth rate of 11.28 % but the growth margin had decreased by 6.85% points YoY.

The production and the distribution were fundamentally balanced as the consumption of coke continued to increase rapidly but the growth margin decreased. In 2006, the apparent consumption volumes of coke across China increased by 17.32% YoY to 183.18 million ton while the growth margin decreased by 8.93% points YoY. As the growth margin is still 0.66 percentage points higher than the average growth margin during the Tenth Five Year Plan period, the consumption is still growing at a high rate in the present period of time.

There presented a favorable trend in energy saving and environmental protection, cutting down energy consumption and pollutant discharge. In 2006, the energy consumption of the coking procedures in coking enterprises, an index that has been listed among key statistics for the coking industry by China Coking Industry Association, decreased by 10.64%, namely 15 kilogram standard coal for each ton, YoY. On average, the drum index of metallurgical coke had been improved by 0.12% points to 82.94% while the ash content in metallurgical coke decreased by 0.23% points to 12.54% YoY on average.

The situation for coking coal resources was fairly loose, and the price remained at a high level. Statistics from relevant institutions show that there produced 2.325 billion tons of coal in China with a year-on-year growth margin of 8.1% in 2006. Prices in the international coal market are becoming lower year after year, for example, the CIF of coking coal exported from Australia to Japan has decreased from USD 125 per ton in the 2005 fiscal year to USD 98 per ton in the 2007 fiscal year; but the prices of coal in China continue to be rising.

As price indexes for coking products had been raised, the coking industry made up the deficits and got surpluses. Relevant statistics showed that in 2006, the coking industry as a whole had begun to make profits in case that there were about one third of coking enterprises with respective independent accounting still suffering deficits resulted from their operations: the profits realized during the whole year had increased by 81.94%YoY to CNY 6.932 billion.

There appeared a distinct trend that coke ovens tend to have a large scale, new coke ovens generally will have their production capacity increased while more efforts are being made to eliminate the behind-lagging production capacity. According to the preliminary statistics from the China Coking Industry Association, a batch of large-scale and medium-scale coking factories closed and stopped the production of large, middle, or small old coking ovens with a total production capacity of 5.08 million tons in 2006.

The production capacity remaining seriously excessive and structural upgrading being imperative under the situation

So far as the international market is concerned, the international coke market is less dependent on coke from China as the global iron and steel industry has entered into a period of steady development at a high level. After the new round of rapid growth in recent years, the demands for iron and steel and the iron and steel production in western developed countries have entered into a period of steady and slowing down development. But the accelerated economic growth in developing countries will make it possible for the global iron and steel production as well as demands for iron and steel in the world to maintain their growth. It is forecast that in 2007, the global production volume of crude steel and pig iron will break through 1.3 billion tons and 900 million tons respectively and hit the respective record highs. However, as competitions in the international energy resource market and the international iron and steel market will become more fierce, it will be surely necessary for iron and steel enterprises to make more efforts in realizing an internal balance between technical progress and saving energy resources so as to cut down their costs and assimilate pressures from the high prices of energy resources in the world; their demands for coke purchased from outside will gradually decrease.

With a view on the domestic market, domestic demands for coke will continue to increase but the growth margin will become smaller steadily. As forecast by the China Coking Industry Association, China's crude steel output will possibly increase by 43.20 to 56 million tons year on year to 462 to 475 million tons. Correspondingly, it is necessary for blast furnaces to produce 446 ~ 458 million tons of pig iron with a year-on-year increment of 41.80 to 53.80 million tons; thus, it will be necessary to consume 20 to 26 million tons of coke more. Considering the energy saving of iron and steel enterprises and the relevant industries as well as the reduction of their energy consumption, there is still a requirement that the yearly coke output should increase by 15 to 20 million tons.

With a view on the production structure in the industry, the production capacity of newly built coking ovens will continue to increase and the elimination of behind-lagging production capacity will be further boosted in 2007. It is still necessary for coking enterprises to insist on cutting down and restricting their production according to demands in the market, control the gross production, and reduce the unfavorable impacts brought forth by the excessive production capacity. According to an analysis on the results from investigations conducted by the China Coking Industry Association, the problem that there exists an excessive production capacity is not radically solved yet although it has been somehow eased; at present, there is a trend that newly built independent coking enterprises in various places will build more coking ovens. In 2007, the supply-demand balance in the coke market will still be determined by the efforts and progress made in reducing and restricting the production of the existing production capacity as well as eliminating the behind-lagging production capacity.

As far as the production procedures are concerned, the price of coke in the market will look forward to getting stable and tend to rise as it is difficult to cut down the high costs for coke production. On the one hand, the coking industry, which has been provided with a foundation for further development after its rapid development in recent years, is still faced with a favorable situation that the national economy is developing continually and rapidly, especially an extremely favorable opportunity that the steady development of the iron and steel industry has generated huge demands in the coke market. On the other hand, it is also faced with many severe challenges; such challenges are as follows: the production capacity is increasing too rapidly; independent coking enterprises simply focusing on coking greatly restrict and cut down their production; demands tend to increase slowly; coke exports suffer a limited space; the coke market is being suppressed as the price of coking coal remains at a high level in the upper stream while prices fluctuate in the downstream steel material market. Although the coke price will not rise or drop heavily, only an extremely limited space has been left for profit making; and it is difficult to cover the expenditures on purchasing coke by simply selling coke. In the meantime, by-products from the coke production are being wasted and it is still difficult to get the pollution problems solved basically. There are a great number of coking enterprises, yet their scale is small and they tend to present a comparatively low industrial concentration degree.

Experts pointed out that it would be a necessary choice for coking enterprise to do a good job in the recycle and in-depth processing of coking products as well as making use of gas produced by coking ovens. No matter considering the issue with a view on clean production, environmental protection, and pollution management or pursuing to improve the economic benefits of coking enterprises, great importance should be attached to the recovery of coking products and the recovery and multipurpose utilization of gas created by coking ovens while the development in such aspects should be accelerated; the development of such craftworks and technologies concerning the in-depth processing of coal tar and the production of methanol and dimethyl ether from gas produced by coking ovens should be expedited and the quality of products from such craftworks and technologies should be improved. As a batch of large coal tar processing equipment has been put into production successively and the petroleum price remains at a high level, coking products like coal tar will become hard to get as resources and their price will fluctuate at a high level together with the price of petroleum in the international market

(Sourced from MySteel.net)

China steel import & export seminar concluded in success

As the world's largest steel producer, China witnessed a milestone change in 2006, turning from net steel importer to net steel exporter. Coming along with this change are increasing trade conflicts, louder voice for antidumping and anti subsidy investigation etc, which require us to clearly observe and contemplate the present steel import & export situation.

China Logistics Information Center and Mysteel (Shanghai Ganglian E-commerce Co. Ltd) jointly held the 2nd China Steel Import & Export Seminar in Shanghai on April 11th 2007, attended by some 400 delegates from over 100 domestic and overseas steel producers, trading companies, end users, steel consultant and research institutes etc. The seminar served as a bridge connecting the steel industry of China and the world, facilitating mutual understanding and communication.

At the seminar, foreign steel traders showed great interest in Chinese steel makers introduction to their products and company. In virtue of this platform, the multi national trading companies obtained brand new understanding of China's steel industry and the products, many expressing intention to enter into direct trading partnership with the domestic producers. Meanwhile, Chinese mills learned they should pick up product mix upgrade in order to sharpen competitive edge on international market; with traders and end users, they earned more overseas cooperators in steel trade business too.

Cape Lambert to acquire three iron ore tenements in Pilbara

Iron ore exploration and development company Cape Lambert Iron Ore Limited has finalized an option to acquire three tenements No E47/1233, E47/1248 and E47/1271 in the Pilbara region of Western Australia, following the documentation of an option agreement with Mr Kim North. These tenements are located adjacent to the Company's Cape Lambert Iron Ore Projects EL47/1462 and increase the size of this tenement holding to approximately 350 square kilometers.

On January 15th 2007, CFE announced it had signed an exclusive option agreement to acquire the tenements. CFE has until 31 October 2007 to exercise the right to acquire the tenements. Under the terms of the option agreement, Cape Lambert has paid Mr North AUD 200,000 and issued him with 600,000 CFE ordinary shares.

Cape Lambert said that Recent exploration drilling at the project has confirmed the presence of a new, high grade mineralized zone, which appears to extend into the optioned tenements. This significant mineralized zone will be subject to an extensive drilling campaign, with results expected to be received by the Company in the coming 2 months to 3 months.

Contract workers block Shougang Perus mine access

Reuters reported that a group of contract workers was blocking the road leading to Shougang Hierro Perus iron ore mine in southern Peru hindering employees movement and affecting operations.

Shougang, in a letter to national regulator Conasev, said that workers hired on service contracts had blocked a road connecting to the Panamerican highway and the situation undermines the normal development of our production operations and creates an atmosphere of tension in the area. Shougang said "We understand that the personnel of this intermediate company are carrying out these unacceptable, violent acts due to administrative complaints they have voiced with their employers.

Mr Julio Ortiz, secretary general of the workers union at Shougang that represents the companys direct employees said that contract workers began the road block on Wednesday to lobby for the rehiring of seven workers whose contracts had ended. Mr Ortiz said "They dont allow company buses to pass. We are practically in a situation where stable workers cannot go out to work.

Shougang faced a number of job related strikes last year. It sells 53% of its ore to China and the rest to South Korea, Japan, Trinidad and Tobago, Mexico, US and Peru. Shougang Peru is owned by Chinas state run steel maker Shougang Group.

Interseroh & ProTrade ink strategic alliance

German Interseroh has signed a strategic alliance with Ohios ProTrade Steel Co Ltd to gain access to the US steel scrap market. The alliance will offer Interseroh an option to acquire a share of the group.

ProTrade Steel Co was established in 1994 and has annual revenue or around USD 250 million it includes an e scrap shredding plant in Florida and two Midwest ferrous shredder sites as well as five trading offices along the East Coast and in the Midwest. ProTrade has oriented its activities towards a new direction within the last few years and steel and metal scrap trading has been expanded by several production sites for processing activities.

Mr Johannes Jurgen Albus CEO of Interseroh said that "For Interseroh, the strategic alliance renders possible access to the US scrap market. In view of the importance of that market, you often have trend-setting decisions for the market itself and for the pricing in the field of steel and metal scrap."

Mr Christian Rubach an Interseroh board member noted that "For us and above all, ProTrade Steel's trading competence reflects an important aspect of this cooperation. Interseroh has to and will further pursue internationalization."

Interseroh manages a network including more than 40 steel and metals recycling sites, primarily in Germany and Poland. Last year Interseroh handled around 3 million tons of steel and metal scrap.

POSCO to increase production of 400 series SS

YEAH reported that with the nickel price crossing USD 50,000 barrier, POSCO is planning to shift its production to 400 series stainless steel in stead of 300 series as the price of 400 series will be at only a third of 300 grades. POSCO aims to bring up the new developed 400 series, which contains no nickel but chrome, to the market.

As per report POSCO will further reduce their 300 grade steel productions to 1.3 million tonnes, and increase 400 grade stainless steel production to 700,000 tonnes from 540,000 tonnes.

POSCO also plan to reduce the consumption of nickel by 14% to 63,000 tonnes in 2007 and use nickel scrap for production instead. Although the nickel scrap is going up slightly but it is still cheaper than refined nickel. Based on this reason, POSCO will switch the production material from nickel to nickel scrap largely by 60%.

CMA to acquire Queensland based Mann Metals

CMA Corporation Ltd has announced that an agreement to acquire Queensland based metals trading and recycling group Mann Metals Pty Ltd through a mix of CMA shares and cash has been reached. It is subject to satisfactory completion of due diligence which is scheduled for completion on April 30th 2007.

The release adds that Further details of the acquisition and transaction timetable will be released to the market once due diligence, structuring and financing arrangements have been completed.

Mann Metals, which trades as Bayside Scrap Metal Industries, has an annual turnover of approximately USD 13 million and operates from 2 sites in the Brisbane metropolitan area. It also has metals recycling operations in PNG and has established metal trading relationships with scrap suppliers in a number of other offshore markets.

Mr Peter Hatfull MD of CMA MD said that CMA is excited by the Mann Metals acquisition. Mann Metals has quickly built a substantial position in the fast growing Queensland market where we anticipate continued strong growth for the foreseeable future on the back of the state's infrastructure, property and mining activity. We also see great potential in Mann Metals' trading relationships with recyclers in a number of offshore markets, with good supply pipelines established and growing."

CMCC led consortium to build Arfa Iron & Steel in Iran

It is reported a Chinese led consortium has bagged a tender to build a EUR 235 million steel factory at Ardakan in Yazd province of Iran. As per report the Chinas Metallurgical Construction Company bid in partnership with the local Ghaemreza based in Isfahan. Arfa Iron & Steel Company is expected to officially make the award in late April.

The project comprises an alloy plant, direct reduction facilities and a 1 million tonnes per year melt shop. As per report, up to USD 230 million investments will come from Bank Markazi hard currency reserves and the rest will be raised from a consortium of local banks.

Mechel completes privatization contract for Campia Turzii

Mechel has announced the completion of its obligations under the privatization contract for its Romanian steel plant Mechel Campia Turzii. The releases said that The Authority of State Assets Recovery of Romania has formally confirmed the fulfillment of all the investment obligations undertaken by Mechel under the privatization contract in purchasing the Romanian company Mechel Campia Turzii.

As per release Mechel has completely met all its investment obligations regarding the three investment years and fulfilled in advance its obligations regarding the fourth and fifth investment years ending on June 20th 2008. Mechel obtained from the trade unions their necessary consent, which allowed Mechel to meet the terms under the contract 13 months earlier than the date stipulated. The privatization contract for Mechel Campia Turzii was originally signed on March 14th 2003 and transfer of ownership took place on June 20th 2003.

After its acquisition, Mechel has invested USD 34 million in Mechel Campia Turzii, including investments in its technical re equipment, environmental protection, repayment of the arrears to the budget, and payment of the shares and working capital. The long term development program of the plant is currently being implemented, which includes significant investments in the modernization of its production capabilities. As a part of this implementation, a press filter to process neutralized pickling solutions was started up early this year, and the workshop for manufacturing and reconditioning of dies was upgraded in the autumn of 2006. In 2006, the plant's rolled product output was approximately 141,700 tonnes and its hardware products output was approximately 86,000 tonnes. In the coming years, Mechel plans to upgrade the capabilities of Mechel Campia Turzii's steelmaking production and subsequent high value added steel product manufacturing.

Mr Alexey Ivanushkin COO of Mechel said "The early closing of the Mechel Campia Turzii privatization contract concludes Mechel's fulfillment of its investment obligations to the Romanian Government, trade unions, and employees of the companies. Mechel also closed its privatization contract for its other Romanian steel plant, Mechel Targoviste, in December 2006. With these investments, Mechel is successfully executing its plans to transform formerly unprofitable assets into sustainable and profitable companies. Joint cooperation with the government of Romania enables Mechel to make future investments in the Company's Romanian assets. A strategic investment program for further developing the Romanian plants in 2007-2011 is currently being developed. The objective of this program is significant cost reduction, further modernization, and improved performance across the entire production process."

Mirabela Nickel orders Outokumpu for Santa Rita nickel project

Australian Mirabela Nickel announced that it has awarded the contract for the purchase of the SAG Mill and Ball Mill for its Santa Rita nickel sulphide project in Bahia State of Brazil to Finlands Outokumpu Technology. The order is valued at USD 20.96 million.

Expected delivery Ex Works is 85 weeks for the Ball mill and 90 weeks for the SAG mill, which is consistent with a schedule for commissioning of the project in early 2009.

The order has been placed before completion of the definitive feasibility study, which gives some idea of the companys confidence in how the study is progressing. The study is due to be completed in May 2007 but the company said it has estimated preliminary costs for the project at around USD 223 million where a preliminary study estimated Santa Rita would be capable of producing 16,000 tonne per year of nickel with start up in early 2009.

Mirabela said that the mill contract award is in keeping with this time table and should significantly de risk the implementation schedule for the project.

Russia plans to build pipeline bypassing Belarus and Poland

MosNews reported that Russian industry and energy ministry wants to build the second leg of a new oil pipeline to Europe bypassing Belarus and Poland in order to reduce Russias dependence on transit countries. Russias industry and energy ministry said in a statement that was quoted by RIA Novosti that A draft project on the construction of the second leg of the Baltic Pipeline System has been introduced to the government.

The ministry said that the proposed pipeline, which will have an annual capacity of 80 million tonne, will run from the Russian town of Unecha, near the Belarusian border, to the Primorsk terminal bordering Finland. It will be the second leg of the Baltic Pipeline System, which will pump Siberian oil from Russia to Germany across the Baltic seabed and on to the rest of Europe and the United States.

Mr Simon Vainshtok, head of state owned pipeline monopoly Transneft, the project operator, earlier said that his company was technically prepared to begin the construction in April.2007. Mr Vainshtok said The Unecha Primorsk pipeline leg is designed to increase the Baltic pipelines annual capacity, which was raised to 74 million tons in 2006 and to provide stable oil supplies to our partners in Western Europe.He added that the new pipeline would help diversify Russian energy exports. He said We expect to reroute half of the 100 million metric tons exported through Belarus, to Primorsk,

The new pipeline will connect Unecha with the oil terminal in the Baltic port of Primorsk though Velikie Luki, allowing Russia to stop pumping oil to Europe via the Druzhba pipeline. It would also increase the capacity of the port at Primorsk to 150 million tons per year.

Gohar Zamin iron ore project to self finance

It is reported that bids were submitted before the Iranian New Year in late March for the Gohar Zamin iron ore project. As per report, most of the bidders were local, say project sources, but an Indian company and a Chinese company also submitted proposals.

Gohar Zamin originally asked bidders to bring their own finance to the table. However, it proved too difficult for them to arrange this and now Gohar Zamin Iron Ore Company, is now looking to fund the work itself. Project sources attributed this situation to the tensions over Irans nuclear program and said that this could result in a reduction in the scale of the plant.

Gohar Zamin work has been divided into two packages. The first, worth USD 500 million, will comprise five iron ore concentration plants of 2 million tonnes a year each. The other is likely to cost up to USD 400 million and involves two 5 million per tonne high grade direct reduction iron ore palletizing plants on 36 month contracts.

The Gole Gohar complex is planned to start production in 2008, with output of about 20 million tonnes [per year of iron ore. The project manager is the local Aseh Sanat Consulting Engineering Company.

Voestalpine to publish takeover bid for Boehler-Uddeholm on May 3

Austrian steel major Voestalpine AG announced that the publication of its takeover bid for Boehler Uddeholm AG is expected to be released on May 3rd 2007 following the completion of the analysis by the Takeover Commission.

Voestalpine said in a statement that on publication the acceptance period for voestalpine's offer of EUR 69 per Boehler share ex 2006 dividend will then run for four weeks.

Illinois coal industry records 4 straight years without a fatality

Illinois governor's office announced that the Illinois coal mine industry has recorded four consecutive years without a fatality to a miner, a milestone never achieved in past.

Mr Joe Angleton director of Illinois office of mines and mineral said "As the coal industry continues to make a comeback here in Illinois, this milestone serves as testament to the hard work of so many people to make an otherwise dangerous job as safe as it can be.

Three new underground mines opened in Illinois in 2006 and a USD 2.5 billion coal mine and power plant is planned for Washington County.

Ukraines Q1 iron ore export up by 7.1% YoY

Ukrainian Journal reported that Ukrainian iron ore producers increased the export of crude iron ore by 7.1% YoY during January to March 2007 to 4.830 million tonnes.

The report cites a source at Ukrrudprom, Ukraines iron ore producers association, said that in the Ukraine also increased the export of iron ore concentrate by 23.6% YoY to 865,000 tonnes.

Datong Coal expected to list at HK in 2007

XFN-ASIA reported that China's 2nd largest coal producer by capacity Datong Coal Mine Group and the parent of Datong Coal Industry Co Ltd is expected to list in Hong Kong this year.

Mr Liu Suisheng chairman of Datong Coal Group told reporters at an industry conference that the preparatory work for the Hong Kong listing is ongoing. He said HSBC and other financial institutions have been appointed as underwriters without providing further details.

Mr Liu also noted that the group is also planning to set up a finance firm and that Datong Coal's coal mine project in Turkey will start operations soon. The mine has projected annual output of 5 million tonnes. He said that the company is also negotiating with Mongolia, Nigeria, North Korea and Malaysia to jointly explore coal resources in these countries.

Datong is aiming to increase its annual overseas coal production capacity to 10 million tonnes by 2010. In the period between 2006 and 2010, the group will invest a total of CNY 75 billion in combined 44 large scare projects, covering coal, power and chemicals. By 2010, the group's annual coal output is expected to reach 150 million tonnes.