India to add 78,577MW capacity by 2012

Mr Sushilkumar Shinde union power minister inaugurated a two day conference on 23rd April at New Delhi, which was convened by the ministry of power and was attended by the chief secretaries and power & energy secretaries of all states and union territories to discuss various power related issues.

The deliberations focused upon the contentious issues currently being confronted by the power sector. The open forum provided a platform conducive for constructive resolutions on the 5 key themes deliberated upon namely, reduction of losses by the distribution utilities, capacity addition road map for the XIth five year plan, open access in transmission & distribution, rural electrification and energy conservation.

Mr Shinde while addressing the delegates pointed out that the entire country is looking towards this sector with a lot of hope and some amount of desperation. He said that The recent growth rate of the Indian economy at 8% to 10% has placed the country amongst the front runners in the world. If this rate of economic growth is to be sustained, our responsibility in the power sector assumes critical importance not only have we to close the gap in terms of the present energy shortages but expand capacity at a rate commensurate with the overall growth rate of the economy.

Mr Shinde said that an ambitious plan to add a generation capacity of more than 70,000 MW in the next 5 years has been envisaged. Transmission network expansion and associated distribution augmentation to match this expansion is also planned. He disclosed that a working group constituted to prepare power sector plan for the next five years has estimated that an investment of about more than INR 1,000,000 crores will be required for the envisaged expansion in power sector during the years 2007-2012, out of which about INR 410,000 crores will be required for utility based generation and IPPs while another INR 427,000 crores of investment is estimated in transmission, distribution and rural electrification segments. He said the present capacity for inter regional transfer of about 11,500 MW would be increased to 37,000 MW in next 5 years.

Mr Shinde appealed to the state governments to take up as many new projects as possible and as early as possible for capacity addition and assured them of all possible help from the central government. He also called for close monitoring and keen attention during implementation of RGGVY projects to ensure that works are completed in scheduled time and quality is as per standards. He said growth in power sector would be meaningless if we are not able to universalize the access to electricity.

During the review it emerged that 78,000 MW capacity addition must be targeted. Implementation plans year wise during the 11th Plan for a total capacity of 78,577 was firmed up with the states indicating a programmed schedule of 16,785MW, 7272MW, 15198MW, 16970MW and 22372MW over the next five years commencing 2007-08 to 2011-12. An additional shelf of 25,357MW projects has been proposed by the states whose viability would be scrutinized.

Vedanta to enter steel business through a JV partner

The Vedanta group plans to enter into the steel business through a JV to utilize the iron ore resources of Sesa Goa, which it recently acquired.

Mr Anil Agarwal chairman of Vedanta told reporters that the proposed entry into the steel sector would be a logical step forward as it would have access to reserves of iron ore, the key raw material for producing steel. Mr Agarwal said the group would team up with a steel company for the proposed venture. He said Mining and steel are altogether different businesses and so we would like to have a partner who has some experience in the steel industry. He did not mention a timeframe for the venture.

Sesa Goa produces 10 million tonnes of iron ore annually and has estimated reserves of 207 million tonnes. It has mines in Goa, Karnataka and Orissa and has acquired a prospective license for Jharkhand. The company also has a small metallurgical coke division with 280,000 tonnes capacity and a pig iron unit with a capacity of 220,000 tonnes a year. Vedanta plans to scale up Sesa Goas production capacity to 14 million tonnes to 15 million tonnes in 18 months to 24 months.

Sesa Goa is the 5th acquisition of the Vedanta in India, which acquired MALCO in 1995, India Foils in 1999, BALCO in 2001 and Hindustan Zinc Limited in 2002.

MSLs 2006-07 net profit surges by 68.5% YoY

D P Jindal Groups Maharashtra Seamless Limited has posted a net profit of INR 530.7 million for January to March 2007 quarter up by 26.3% YoY as compared to INR 420.3 million during January to March 2006 quarter. Its total income net of excise has increased from INR 2980.8 million in January to March 2006 to INR 3777.2 million during January to March 2007 quarter

MSL has posted a net profit of INR 2353 million for 2006-07 up by 68.5% YoY as compared to INR 1396 million during 2005-06. MSLs total income net of excise has also increased from INR 9842.5 million in 2005-06 to INR 14264.50 million in 2006-07.

HZL to expand Debari zinc smelter capacity

It is reported that Hindustan Zinc Ltd is planning to expand the capacity of its zinc smelter at Debari in Rajasthan by de bottlenecking and has already invited expressions of interests for the purpose.

The expression of interest has been invited for design, engineering, supply, erection and commission on lump sum turnkey basis for 2 packages consisting mainly of new de mineralized water treatment plant, new reverse osmosis plant to treat the effluent treatment plant water, up gradation and renovation of existing water and effluent treatment facilities, cooling water pumps and electrical & instrumental work for the package.

HZL is part of the London Stock Exchanged listed company Vedanta Resources Plc which deals with aluminum, copper, lead, zinc, gold and silver with operations in India, Australia, Armenia and Zambia.

BIS certifies 11 foreign firms for import of cement into India

It is reported that Bureau of Indian Standards has certified 11 cement manufacturers from the UAE, Bangladesh and Bhutan allowing them to sell the product in India. The certification of BIS is necessary to sell any cement in India.

BIS said. "The Cement (Quality Control) Order of 2003 prohibits manufacture, storage, sale and distribution of cement without it conforming to specified Indian standards and without bearing the ISI mark." The order applies to cement whether indigenously manufactured or imported.

BIS said in case of fresh applications, the agency would grant the license in 2months to 3 months, provided all the requirements are met and the cement samples cleared in the first attempt.

Earlier this month, Indian government had scrapped the import duties on cement to rein in rising prices of cement retail hurting the end consumers.

SJVNL inks MoU with Konkan railway for J&K project

Satluj Jal Vidyut Nigam Ltd has signed a MoU with Konkan Railway Corporation Ltd for providing consultancy services for geotechnical investigation and related design works for tunnels for J&K Project of Konkan Railway.

J&K project comprises of construction of 90 kilometer section of single broad gauge railway line between Katra and Laole from kilometer 30 to kilometer 120 as part of Udhampur Srinagar to Baramula rail link project. The KRCL reach between Katra and Laole is passing through a very difficult terrain of Himalayan geology in 90 kilometer reach.

SJVNL has vast experience in Geotechnical Engineering and has expertise of design and construction of tunnels in difficult terrain of Himalayas. SJVNL has successfully commissioned 1500 MW Nathpa Jhakri hydro electric project in Himachal Pradesh having 27.4 kilometer long tunnel with 10.5 meter diameter.

Everest Kanto bags INR 220 crore export orders

Everest Kanto Cylinder Ltd announced that it has bagged exports orders worth INR 220 crore for the supply of specialized cylinders.

Everest Kanto has started construction work in China. The Company plans to invest US$ 50 million in the first phase of its China operation. The Company has already formed a separate wholly owned subsidiary Company EKC Industries (Tianjin) Co Ltd. It has also ordered the machines for the project. The implementation of this project has started picking up speed and is slated to start production in the last quarter of this calendar year with an initial capacity of 200,000 cylinders. Everest Kanto plans to ramp up the capacity to 1.5 million cylinders in the next 3 years to 4 years.

JSW Aluminum changes location of project to South Kota

Jindal South West Aluminum Limited recently announced that it has shifted its INR 4,000 crore alumina refinery project to South Kota in Vizianagaram district of Andhra Pradesh from Sabbavaram after a public hearing held by the Andhra Pradesh pollution control board directed them to relocate due to heavy appreciation of real estate prices on the city suburbs.

Mr Sandeep Gokhale business development director of JSWAL told reporters that "We want to make it very clear that we are not into real estates. The district authorities sought the land sought by us at Sabbavaram at INR 2 million an acre which we found not viable for our project. In South Kota, the extent of private land involved and displacement of people is minimal."

JSWAL has already identified approximately 1,300 acres in and around Boddavara in South Kota mandal. Mr Gokhale informed that 87% of land identified by them belonged to the government and only about 50 families would be displaced.

The refinery will have a capacity of 1.4 million tonnes per annum with a 90 MW co generation plant. The refinery would come up in 36 months from the date of getting forest, environment and other clearances.

The INR 5,000 crores smelter, which is likely to be located in Khammam district of AP due to close proximity to coal mines, will have a production capacity of 4.2 million tonnes per annum. JSWAL has signed a MoU with the state government under which the Andhra Pradesh mineral development corporation would supply them bauxite ore after obtaining all the clearances. The ore will come through closed conveyer. There will be a 50 kilometer rail linkage up to Semiliguda. As Araku has 60 million tonne deposit, the raw material from that side will be enough for 15 years to 18 years.

Adani plans IPO for Mundra Port Report

It was recently reported that the Adani Groups Mundra Port and adjacent SEZ plans to raise USD 400 million from its initial public offering in June 2007 for funding expansion of its facilities. The listing proposal follows a major restructuring exercise, which made the Mundra Port SEZ the operator and holding company for 3 port projects Mundra, Dahej and Dholera, apart from the sprawling SEZ.

As per report, Mundra port will also offload 10% of its stake or around 40.25 million shares to the public, foreign institutional investors, Indian financial institutions and insurance companies.

The funds raised from the Mundra Port and Special Economic Zone listing and stake sale will largely go toward the expansion of Mundra and two other ports. According to senior port officials the port owner will set aside USD 158 million from the equity sale to develop the Mundra Port and build infrastructure including roads by 2010 and will also spend a further USD 68 million to build a terminal for coal and other general cargo. MPSEZ officials said the company would invest around USD 57 million in Dahejs equity and the total project cost was expected to be around USD 273 million. The Petronet and Adani project envisages building a bulk cargo port for products such as coal, steel and fertilizer, which will be completed in two phases within 36 months.

Mundra and the proposed Dholera port is wholly owned by the Adani Group, while the Dahej Port is being developed in partnership with Petronet LNG with the Adani Group is holding a 50% stake.

Mr Ashwin Muthiah appointed as chairman of Sical Logistics

Sical Logistics, at its extra ordinary general meeting held in Chennai, has appointed Mr Ashwin Muthiah as the chairman of the company besides inducting a newly re structured board which would comprise of 2 promoter nominees, one a director from IDFC private equity and three independent directors.

Mr Luis Miranda president and CEO of IDFC private equity fund II has been inducted onto the board as the director from IDFC and Mr Karthik Menon vice president finance & strategy of Sical Logistics has been inducted as the promoter nominee and the whole time director on the board of Sical.

Mr Ashwin Muthiah said that The restructuring of the board and the induction of IDFC PE is a definitive step in our efforts to make Sical a professionally managed, board run company. We expect this effort in improving transparency and corporate governance will give confidence to our investors that Sical is headed in the right direction.

Mr Ashwin added that I have always maintained that people and capital are the most important challenges to our growth; as you would be aware we have undergone a management transition over the last quarter and inducted professionals with specialized expertise in logistics operations across the organization. We are building single-window solutions for customers and shifting to bottom-line focused region-centric presence. In this pursuit, capital is an essential building block which our new team will need to build the Sical of the future.

Sical Logistics Limited is Indias leading provider of integrated multi modal logistics for bulk and containerized cargo. Sicals delivery network includes an exclusive walk in berth at Chennai for ships carrying bulk cargo; a container terminal at Tuticorin, 1.9 million square feet of storage across over 100 warehouses; owned and regularly contracted fleet of over 2400 transport vehicles, and container freight stations at 3 locations in India.

China may take more measures to curb exports

Mr Qi Xiangdong deputy secretary general of CISA disclosed on a Beijing conference that if China fails to see desired effect to curb export by the rebate changes, it may further consider taking license system. Mr Qi said that "If the export rebate tax change on April 15th fails to achieve desired effect, we will consider further measures."

Mr Qi, separately commenting on China's export, said that China's export as appropriate taking up 10% of the global figure, while its output occupies a much bigger portion of 36% and there is still big potential for China to explore high end steel market. In fact, Russia and the Southeast Asia are still in great demand for billets & slabs, while few domestic producers are exporting these semis.

He added that The market will speak for itself and we need to study the consumption structure to follow. Intervention by rebate cut or removal may trigger rise in PPI and CPI, hence risking heavier inflation pressure and hurt on long term development.

Mr Chen Haoran director of CCCMC earlier had suggested introducing in automatic licensing system for steel exports of 215 tax codes of 26 groups, in an attempt to make effective supervision on steel export, facilitate macro control and reduce risk of trade disputes.

(Sourced from MySteel.net)

CSN's Q1 profit surges by 124% YoY

Brazilian steel maker Companhia Siderurgica Nacional announced its results for January to March quarter of 2007 in accordance with Brazilian accounting principles. It posted its biggest quarterly profit in at least six years as prices rose and output recovered after a blast furnace was repaired. The quarterly profit is the largest since 2001 when the company sold its stake in Cia Vale do Rio Doce.

CSN recorded Net Income of BRR 763 million in the first quarter of 2007 up by 124% YoY and its quarterly net revenue totaled BRR 2.485 billion up by 27% YoY. CSNs EBITDA in the quarter reached BRR 1.015 billion up by 29% YoY with an EBITDA margin of more than 40%. CSNs net Debt fell from BRR 6.7 billion on December 31st 2006 to BRR 6.1 billion on March 31st 2007.

CSN saw its flat steel market share within Brazil expand to 33% in 1Q07 from 30% in the first quarter of 2006.

CSN in a statement said that This important result was essentially due to the positive combination of the prices obtained throughout this first quarter and higher sales volume, The results are further proof that the it has fully recovered from the accident to the installations adjacent to its the main blast furnace in the Presidente Vargas Steelworks, in Volta Redonda, State of Rio de Janeiro, which occurred in January 2006.

CSNs bottom line also benefited from the company's 3.8% minority stake sale in Corus that generated non operating gains of BRL 133 million net of taxes.

CSNs investments in January to March 2007 quarter amounted to BRR 234 million, including BRR 59 million for the expansion of CSN's Casa de Pedra iron ore mine in Minas Gerais state and BRL 17 million for the expansion of its Itaguaport terminal in Rio de Janeiro state among other areas.

SteelBenchmarker reports partial softening in hot band

SteelBenchmarker reported that the US HRB spot price for April 23rd 2007 dropped by 0.8% to USD 625 per tonne after 5 consecutive rises and the world export HRB price slipped by 0.3% to USD 589 per tonne FOB the port of export for the 2nd consecutive drop. Meanwhile the Chinese HRB ex works price rose by 1.8% to USD 448 per tonne for the 2nd consecutive rise and the Western European HRB price rose by 2.1% to USD 691 per tonne for the 10th time.

The 4 benchmark prices for HRB included in the April 23rd 2007 report are

1. US
USD 625 per metric tonne
Down by USD 5 per ton from USD 630 2 weeks ago
Up by USD 54 per tonne from the low of USD 571 on January 22nd 2007
Down by USD 73 per tonne from the previous high of USD 698 on July 24th 2006

2. World Export Price
USD 589 per tonne
Down by USD 2 per tonne from USD 591 2 weeks ago
Up by USD 90 per tonne from the previous low of USD 499 on December 11th 2006
Down by USD 21 per tonne from the peak of USD 610 on June 12th 2006

3. Western Europe
USD 691 per tonne
Up by ISD14 per tonne from USD 677 2 weeks ago
Up by USD 135 per tonne from the low of USD 556 on November 27th 2006
Up by USD 60 per tonne from the previous peak of USD 631 reached on July 24th 2006

4. China
USD 448 per tonne
Up by USD 8 per ton from USD 440 2 weeks ago
Up by USD 75 per tonne from the low of USF 373 on July 24th 2006
Down by USD 16 per tonne from the high of USD 464 on June 12th 2006

SteelBenchmarker publishes steel benchmark prices for HRB, cold rolled coil, rebar, and standard plate in the US, Western Europe, mainland China and the world export market every fortnight.

CVRD to build "China Fleet" for saving freight cost

CVRD is planning to build new bulk carriers named China Fleet together with its Chinese partners in an attempt to save the freight cost. As per report, Shougang Group plans to join forces with CVRD to ship ore to its new North China base.

Mr Renato Paladino GM of CVRD China at a recent conference in Beijing told that ore freight rate for Brazil to China route is too expensive therefore the company intends to build 10 to 20 new ships to moving iron ore to China.

Mr Liu Shuiyang vice GM of Shougang told Shanghai Securities News that "The move is designed to cut freight costs to offset mounting iron ore prices and secure a stable supply. The JV planned iron ore fleet would consist of vessels with a loading capacity of at least 300,000 tons each, up from the less than 200,000 tons of ships Shougang currently uses, which will help the company slash freight costs by almost half to USD 10 per ton from current USD 22 to USD 24 per ton.

The Indian export tax has made Indian iron ore less attractive for Chinese buyers, who now prefer purchasing from Brazil and Australia. However, rising freight rates has dampened the competitiveness of Brazilian iron ore compared with supply from its Australian rival BHP and Rio Tinto who enjoys a geographical proximity to China.

(Sourced from MySteel.net)

Teck Cominco sees few acquisition targets

Canadian mining major Teck Cominco, which last year failed in a bid for nickel giant Inco, is still keen to diversify into nickel or other metals but sees few acquisition targets.

Mr Don Lindsay CEO of Teck Cominco during a call to discuss first quarter results said that Nickel, uranium and iron ore, we would love to have assets in those commodities. We are still very interested in nickel, but we don't see entry points in that industry. It's a reasonably small industry."

Teck in a statement said that it has the funds to make strategic acquisitions, with nearly CAD 5 billion in cash and temporary investments but the company has instead focused on internal growth and buying back shares.

Norilsk Nickel achieves production targets in January to March

Nickel and palladium producer Norilsk Nickel has hit the metal production target for January to March 2007. The group's total production volume was 61,000 tonnes of nickel, 101,000 tonnes of copper, 716,000 ounces (22.3 tonnes) of palladium and 169,000 ounces (5.3 tonnes) of platinum. The figures do not account for platinum and palladium production from the US subsidiary Stillwater Mining.

Norilsk Nickels January to March output of nickel and palladium was flat at levels in Q1 of 2006 but copper output dropped by 8% YoY and platinum by 3% YoY. Reduction of copper output in Q1 is caused by a repair of skip hoist at Komsomolsky mine, as well as allround modernization of Norilsk beneficiation plant.

With OM Groups nickel assets acquisition, NorNickel is increasing nickel production plan for 2007 from 240,000 tonnes - 245,000 tonnes to 270,000 tonnes - 275,000 tonnes. Other 2007 annual production plans include copper at 404,000 tonnes to 409,000 tonnes, palladium at 3,000,000 ounce to 3,050,000 ounces (93 tonnes - 95 tonnes) and platinum at 700,000 ounces -710,000 ounces (about 22 tonnes).

OM Groups nickel assets acquisition deal was completed on Mar 1st 2007 and adds to Norilsks Russian portfolio of assets OM Groups Cawse mine in Australia, its Harjavalta refinery in Finland and its 20% holding in Australian junior producer MPI Nickel.

Carbofer buys EvrazMetal steel distribution network

Metal Expert reported that Swiss trading company Carbofer and Russian Evraz Holding are awaiting approval of Russias Federal Antimonopoly Service to finalize the deal of purchasing the steel distribution network EvrazMetal by Carbofer.

The agreement of mutual understanding between the Carbofer and EvrazHolding was signed in March 2006. The subject of this agreement was the entire trading network EvrazMetal, including its six regional subdivisions. According to the long term contracts signed between the companies, Carbofer undertakes within five years to sell about 5.5 million tonne of steel produced by EvrazHolding Group. The yearly sales volume will thus be at least 1.1 million tonne.

As per report, for the time being, Carbofer does not plan to make any changes in the EvrazMetal structure, nor to modify the established system of its client support, change the management and staff of the subordinated companies. According to plans, the EvrazMetals task will continue to be distribution of finished steel products manufactured by Evraz Group on the territory of Russia. However, Carbofer does not rule out a possibility of selling the products of other Russian and foreign steel producers with the use of the well developed and structured trading network of EvrazMetal.

As per report, Carbofer is currently elaborating a plan of further development of EvrazMetal network and is considering a possibility of a slight increase in supplies of imported products for sales in Russia.

Chaparral Steel hires Goldman Sachs to review strategic alternatives

Chaparral Steel Company announced that its board of directors has initiated a review of strategic alternatives and has retained Goldman Sachs & Co to assist in the review.

As per release, during the process, Chaparral Steel will consider the full range of possible alternatives including possible strategic partnerships, mergers, acquisitions, sale or recapitalizations. The Company also stated that there can be no assurance that this process will result in a transaction.

Mr Tommy A Valenta president & CEO "The Company will only pursue transactions that reflect the full value of this great company. To capture that value, all strategic alternatives will be considered."

The Company does not intend to disclose developments regarding its exploration of strategic alternatives unless and until its Board of Directors approves a definitive transaction.

Chaparral Steel Company, headquartered at Midlothian in Texas US is the second largest producer of structural steel beams in North America. The Company is also a supplier of steel bar products. In addition, Chaparral is a leading North American recycling company.

CVRD & CSC ink long term iron ore deal

Hoovers reported that Taiwanese China Steel Corporation has signed a 10 year iron ore contract with Brazilian Companhia Vale do Rio Doce.

Under the terms of the contract, China Steel Corp will buy about 1.8 million tonnes of iron ore a year from CVRD. The contract is effective from 2007 to 2016.

CSC, which produces about 11 million tonnes of crude steel a year, has been buying iron ore from CVRD since 1977.

JFE Steels announces CAPEX for 2007-08

JFE Steel Corporation has announced its capital investment plan for the fiscal year ending March 31st 2008 as under.

Amount of Capital Investment

In billion JPY

Major Investment Projects in Fiscal Year ending March 2008

In billion JPY

Reference: Capital Investment by Year

In billion JPY

Figures for 1995 to 2003 are the sum of NKKs and Kawasaki Steels capital investment.

Peru miners may go for nationwide strike

Reuters reported that workers at Peru National Federation of Metallurgic and Steel Miners are planning an indefinite, nationwide strike which will be joined by other workers from country's largest pits to demand better benefits. The federation is demanding that president Mr Alan Garcia fulfill campaign pledges to eliminate outsourcing among mining companies and to improve pension benefits.

Mr Luis Castillo president of National Federation of Metallurgic and Steel Miners said that "On Monday, we met with the labor minister and didn't reach an accord. We have another meeting on Thursday with the government and that's where the talks will end. The strike is still on." Mr Castillo said his federation groups 74 mining unions in Peru representing some 22,000 workers and about 110,000 miners are estimated to work in the sector overall.

Union leaders of Southern Copper Corp told Reuters that they will participate, as did workers at the Peruvian unit of US based Doe Run Co which runs the South American country's largest smelter complex. Workers at Latin Americas largest gold mine Yanacocha and at zinc miner Volcan said that they also plan to join the nationwide strike.

Meanwhile the National Society of Mining, Petroleum and Energy has described the strike as a political protest and asked the government to declare it illegal.

It is noted that the last nationwide strike took place 3 years ago when miners stopped work for 48 hours to protest labor policies under former president Mr Alejandro Toledo.

Mining is one of the economy's main drivers and accounts for more than half of Peru's export earnings. The country is the world's no 3 copper and zinc producer, a top two silver producer and no 5 in gold.

Steel futures to help Chinese steelmakers SFE

Shanghai Futures Exchange said that the proposed steel futures market in Shanghai would help China better align its massive steel industry scale with a still underdeveloped global pricing capability.

Mr Yang Maijun MD of the Shanghai Futures Exchange told XFN-ASIA that China is a major steel producer but we are still not a major influential pricing power and a steel futures market would help us leverage our scale to set global steel prices. We have been too passive in responding to market changes and a steel futures market would enable Chinese steelmakers to upgrade product quality and realize higher returns.

He added that the proposed pricing mechanism would help the country's steelmakers retire outdated steel products and provide a better platform for the central government to implement macro economic controls across a wider section of the economy.

Mr Maijun said there were numerous benefits that would result from establishing a steel futures market in Shanghai.

Rautaruukki announces strong results for Q1 of 2007

Rautaruukki has announced strong earnings in January to March quarter of 2007 driven by strong demand for steel and industrial construction materials. Rautaruukki quarterly sales increased to EUR 950 million up by 11% YoY from EUR 856 million in Q1 of 2006 and operating profit almost doubled to EUR 178 million as compared to EUR 95 million in Q1 of 2006.

The Ruukki Construction unit division recorded EUR 33 million operating profit in Q1 of 2007 as compared with EUR 8 million in Q1 of 2006. Ruukki Engineering saw an operating profit of EUR 32 million as against EUR 25 million in Q1 of 2006. Ruukki Metals' operating profit was EUR 119 million as compared to EUR 77 million in Q1 of 2006.

Ruukki United, the group's program to improve efficiency and cut costs, has achieved EUR 56 million cost savings by the end of Q1 out of EUR 150 million targets that is set for 2008.

Rautaruukki said it expects 2007 sales growth to be in line with growth targets set with operating profit seen exceeding the comparative figure of 2006. It also said that the market will continue to hold up well in all its product areas.

MMXs CorumbBF startup delayed to June

BNamericas reported that MMX plans to start operations of its first blast furnace of its Corumbpig iron project in June 2007 instead of May.

The new launch date reflects a temporary halt in construction at the Mato Grosso do Sul state plant which was ruled by a federal judge in Corumbon April 10th 2007 and lifted on April 20th 2007. The embargo order was issued on allegations that licenses for the project should have been provided by federal environmental protection agency Ibama instead of the Mato Grosso do Sul environmental institute Imasul.

According to the spokesperson as a result of the new project timeline, the startup of the second blast furnace could also be delayed by one month to October.

MMXs Corumbproject includes the 400,000 tonne per year pig iron plant, a 4.9 million tonne per year iron ore mine and a 500,000 tone per year semi finished unit.

MMX is a subsidiary of Brazilian mining, metals and energy group EBX.

Evraz & Mitsui end Denisovskoye coking coal JV

Evraz Group announced that Evraz and Japan's Mitsui & Co have pulled out of an agreement signed in 2005 to jointly develop the Denisovskoye coal project in Yakutia region of Russia after it turned out to be less economically attractive than originally estimated.

Evraz Group sold its stake to Yakutskiye Ugli New Technologies for USD 94 million.

Evraz said in a statement The development of the Greenfield project was challenged by its remote location, limited infrastructure, and was adversely impacted by difficult conditions that were not identified during the preliminary geological exploration stage.

The total investment in the project was around USD 260 million with 30% stake from Mitsui amounting to USD 80 million and a holding company Coke Oven Overseas Contribution Limited was specially set up to implement the Denisovskoye project.

The Denisovskoye deposit has recoverable reserves estimated at 70 million tones to 85 million tonnes of coking coal. After the deposit reaches projected capacity in 2008, production will be around 2.4 million tonnes. All of the coal is to be exported to Asian steel makers.

Lone Stars 2007 Q1 earnings dip by 49% QoQ

Lone Star Technologies Inc has reported quarterly net income of USD 9.2 million for January to March 2007 quarter down by 49.1% QoQ as compared to net income of USD 18.1 million in October to December 2006 quarter. Its EBITDA was USD 20.6 million in the first quarter of 2007. Lone Star attributed the decrease in net income to reduced revenues from oilfield products and USD 3.1 million in expenses, net of income taxes, for professional fees associated with the proposed acquisition of Lone Star by United States Steel Corporation.

Its quarterly revenues was USD 311 million down by 7% QoQ as compared to revenue in fourth quarter of 2006, as oilfield revenues of USD 245.1 million declined by 8% QoQ. Oilfield shipment volumes decreased by 5% QoQ due to 15% lower shipments of line pipe. Average selling prices decreased by 4% QoQ principally due to a less favorable mix of OCTG products shipped.

As a result of stronger demand, revenues from specialty tubing products for the first quarter of 2007 increased 13% to USD 48.3 million from the fourth quarter of 2006 on 12% lower average selling prices related to product mix and 29% higher shipment volumes. The increased revenue is attributable to increased sales to original equipment manufacturers and incremental shipments of boiler tubes and fuel economizers.

Revenues from flat rolled steel and other products declined 31% to USD 17.6 million compared to the fourth quarter of 2006 on a 27% decrease in shipment volumes combined with 5% lower average selling prices.

Mr Rhys J Best chairman & CEO of Lone Star said "While first quarter 2007 average natural gas spot prices improved approximately 4% from the fourth quarter of 2006, distributors remained cautious with their OCTG purchases and our OCTG shipment volumes remained essentially unchanged. Line pipe shipment volumes declined approximately 15% in the quarter from the high level established in the fourth quarter, but demand for line pipe is expected to remain healthy and grow throughout 2007. We look forward to completing the merger with US Steel and quickly commencing integration. Additionally, we remain excited about our strategic joint venture with Valin Tube and Wire. We believe that the combination of US Steel and Lone Star, along with the Valin joint venture, will create a world-class platform to offer our customers the broadest array of high-quality products available on a global basis."

Lone Star Technologies Inc's principal operating subsidiaries manufacture, market and provide custom services related to oilfield casing, tubing, couplings, and line pipe, specialty tubing products used in a variety of applications and flat rolled steel and other tubular products.

LME may launch steel contract in early 2008

Mr Martin Abbott LME CEO said during a panel discussion at the Institute of Scrap Recycling Industries conference informed that the London Metal Exchange is still working out details of an over the counter steel contract and is now targeting 2008 for a likely launch. However, Mr Abbott added that "Although, there is an outside chance that we will be trading in late calendar 2007.

He said a specific steel benchmark product has not yet been decided upon, although hot rolled coil is among the products being carefully considered and that pricing will almost certainly be index based and regional in nature.

Mr Abbott indicated that With HRC in particular, we find it very difficult to construct a physical delivery point contract. Physical contracts may well be global. On the other hand we think there is no point in forcing a global benchmark if the markets are really regional.

Previous indications by LME had indicated a launch within 2007.

Grupo Simec posts results for Q1 of 2007

Mexican Grupo Simec SAB de CV recently announced its results of operations for January to March 2007 quarter. Its net sales in the quarter increased by 4% YoY from MXN 5,848 million for the first quarter 2006 compared with MXN. 6,079 million for the same period 2007 due to an increase in volume as prices remained stable.

Gross profit increased by 25% YoY to MXN 1,210 million compared to MXN 967 million in Q1 of 2006 and operating profit increased by 35% YoY from MXN 634 million in Q1 of 2006 to MXN 856 million. Operating profit as a percentage of sales in the first quarter 2006 was 11% as compared to 14% in the same period 2007. This was due to increase in volumes of products sold and stable prices.

Net sales increased by 27% YoY due to an increase of 13% in prices and a 12% increase in volume making net sales go from MXN 4,785 million for the fourth quarter 2006 to MXN 6,079 million for the first quarter 2007. Its sales of finished steel products increased 4% YoY to 704,000 tonnes in the first quarter 2007 as compared with 680,000 tonnes in the same period 2006. Its total sales outside of Mexico for the first quarter 2007 decreased by 4% YoY to MXN 4,250 million as compared with MXN 4,443 million for the same period 2006 and total Mexican sales increased by 30% YoY from MXN 1,405 million in 2006 to MXN 1,829 millions in the same period 2007.

Macedonian MakSteel to increase production

MaKfAX reported that MakSteel, one of the largest steel companies in Macedonia, will increase its output by 190.000 tonnes in the next two years.

Mr Minco Jordanov Board President of MakSteel said that MakSteel will boost its output by 190.000 tonnes in the next two years. The statement was made in the presence of Mr Nikola Gruevski prime minister and the Mr Zoran Stavrevski deputy prime minister of Macedonia and it was welcomed by the prime minister.

MakSteel recently signed a deal with Stopanska Banka and the Greek National Bank for EUR 43 million worth of credit line. As per report, a total of EUR 22 million of the loans will be used for development of production and the rest of the loan will be used for environmental protection projects.

MakSteel manufactures around 330.000 tonnes of steel products a year and intends to boost the production to a total of 520.000 tonnes per year.

Ipsco Q1 profit dip by 27% YoY

Canadian steelmaker Ipsco Inc has posted net profit of USD 109.4 million in January to March 2007 down by 27% YoY as against USD 150.7 million in Q1 of 2006. Ipscos sales were up by 14.3% YoY to a record USD 1 billion as it benefited from the acquisition of a Kentucky based company NS Group last year.

Mr David Sutherland CEO of Ipsco said that the company remains strong despite its Q1 2007 profits slide down. Mr Sutherland said that the bottom line was affected by a range of events including the amortization of the remaining USD 24 million fair value increment allocated to NS Group inventory, higher scrap costs, expenses related mill maintenance downtime in Mobile, Al and higher tubular product costs. Poor whether for oil drilling in Western Canada was also being blamed for the dip. The oil industry is a big user of the company's steel pipe.

Still, Mr Sutherland said he was pleased and said that "Looking forward the prospects for Ipsco continue to be very positive. We have an excellent footprint in the facilities and the markets that we participate in and an excellent pipeline of projects which will further develop our business."

Ipsco with 2,500 employees is a leading producer of energy industry tubular products and steel plate, with an annual steelmaking capacity of 4 million tonnes. It operates 4 steel mills and 11 pipe mills and other processing centers in the United States and Canada.

Mechel commissions shearing press at Mechel Targoviste

Mechel announced the installation and commissioning of a new shearing press in the electric arc furnace shop at its Romanian steel plant Mechel Targoviste. The work has been completed in line with the current stage of Mechel Targoviste production facilities modernization program designed for the period of 2007 to 2011.

The shearing press is designed to process oversized metal scrap and provide steel melting works with high quality charge. The new shearing press is a modern fully automated unit and is completely analogous to the current operating equipment in terms of its technical characteristics. Depending on the metal used for reprocessing, its production capacity ranges from 15 to 22 tonnes per hour with a cutting force of 700 tonnes.

This is the second shearing press installed at the plant with the first put into operation in 2004.

Mechel plans to significantly reduce per tonne fixed costs with a complex of technical measures aimed at further modernization of EAF No 2, including modernization of the transformer and a change of the furnace's operating charging baskets and steel teeming ladles and to reach annual capacity of 600,000 tonnes in 2008.

Tianjin Iron & Steel orders for 2 steel mini mills

Chinas Tianjin Iron and Steel Co Ltd and Concast of Switzerland have concluded a contract for the supply of two electric steelworks.

The supply scope for the engineering and the plants contains two arc furnaces each with a capacity of 110 tonnes, 2 ladle furnaces, a vacuum degassing station, a continuous billet caster and a continuous bloom caster.

The arc furnaces are designed for charging with up to 40 % hot metal. However, plans are also being made for an operating practice with 100% scrap. Both furnaces will be operated with 80 MVA transformers. In addition to a Concast electrode positioning control, they will be equipped with slag control and detection system and CONSO systems for the introduction of chemical energy and for rapid decarburization for performance optimization.