JSW Steel buys UK based Argent Independent Steel

JSW Steel announced that JSW Steel Ltd, through its wholly owned subsidiary JSW Steel (UK) Ltd has entered into a share purchase agreement to acquire 100% stake in Argent Independent Steel (Holdings) Ltd of UK, which in turn owns all the shares of Argent Independent Steel Ltd, a steel service centre company at Newport in South Wales of UK for INR 31 crore (GBP 3.75 million).

The consideration of GBP 3.75 million includes an existing loan of GBP 2.1 million. JSW Steel proposes to fund the cost of acquisition from its cash accruals.

Argent Independent Steel Ltd was formed in October 2006, after a management buyout of ThyssenKrupp Service Centre UK Ltd, a part of ThyssenKrupp Germany. Argent Independent Steel has an annual processing capacity of 150,000 tonnes at Newport in South Wales. It is involved in slitting, blanking and recoiling processes of steel products and caters to the automotive and construction sectors. The turnover of the company in 2006 was GBP 26.3 million.

Mr Sajjan Jindal vice CMD of JSW Steel said the acquisition would enable JSW Steel to reach customers in the developed market faster. He said We will send finished steel from India to the UK to be tailor made for customers there. We hope to gain from this experience and set up similar centers across Europe.

Indias sponge iron production forecast to cross 30 million tonnes by 2020

Dr Akhilesh Das minister of state for steel informed the lower house of parliament that the union government has no specific proposal for development of sponge iron industry. However, Government has formulated a National Steel Policy under which sponge iron industry finds an important role.

Dr Das informed that, Indias National Steel Policy envisages sponge iron production to 30 million tonne per annum by the year 2020 from the current level of about 13 million tonne per annum.

Dr Das added that Sponge iron like steel is completely deregulated industry. Therefore, initiative on quality improvement of the product rests with the entrepreneurs. Since the sector is deregulated, the sponge iron producers are free to explore national and international market for their products.

Mr PK Bishnoi takes charge as CMD of RINL

BL reported that Mr PK Bishnoi director finance of Rashtriya Ispat Nigam Limited has assumed charge as CMD of RINL on Monday.

Prior to joining RINL in 2004 as director finance, Mr Bishnoi served in L&T, the Planning Commission and Balmer and Lawrie Co Ltd.

Mr Bishnoi graduated from the Indian School of Mines Dhanbad and later obtained the MBA degree from the Indian Institute of Management Ahmedabad.

JSW plans a 5 million tonne CR complex in US

PTI reported that JSW Steel plans to set up a 5 million tonne Greenfield steel processing facility in the US at an investment of 1 billion dollars to tap the world's largest automobile market.

Mr Sajjan Jindal vice CMD of JSW Steel said "We are actively planning to set up a Greenfield steel plant in the USA, capable of manufacturing 5 million tonnes of cold rolled steel, to cater primarily to the automobile market there. Mr Jindal, denying reports that JSW was planning to go buy a company in the US, said that he opposed such acquisition as this could invite pension liabilities, outdated machinery and unionized labor.

Mr Jindal said that semi finished steel from the proposed West Bengal steel plant would be shipped to the US facility to be processed further and sold to the buyers. He added that JSW Steel is scouting for a location close to the port to ferry semi finished steel from India.

Mr Jindal informed that he favored USA for setting up a steel plant, as it consumed around 135 million tonnes of steel. Out of which it produced 95 million tonnes and imported the rest.

Mr Jindal also said that he is interested for setting up similar plant in Europe also and the possible locations were Spain, Portugal, Italy and Turkey.

NMDC to produce 50 million tonne iron ore by 2014-15

National Mineral Development Corporation Limited has planned to increase the production of iron ore from the level of 27 million tonnes achieved in 2006-07 to 50 million tonnes per annum by 2014-15.

The details of targets for production of iron ore and achievements by NMDC during the last three years are given below

In million tonnes

Dr Akhilesh Das minister of state for steel informed the lower house of parliament that although NMDC applies to various state governments for grant of mining leases from time to time, it can not be forecasted as to when the concerned state governments will take a decision on mining lease applications made by NMDC.

NTPC commissions stage III of VSTPP

Mr Sushilkumar Shinde union power minister has recently commissioned the 2nd 500 MW unit of Stage-III Vindhyachal Super Thermal Power Project at Vindhyanagar in Madhya Pradesh thus taking total installed capacity of the station to 3260 MW. With this, Vindhyachal has becomes the largest power station of the country.

The foundation stone of NTPC Vindhayachal was laid by Late Prime Minister Ms Indira Gandhi in the year 1982. Vindhayachal has 6 units of 210 MW and 4 units of 500 MW. States of Madhya Pradesh, Maharashtra, Chhattisgarh, Gujarat and Union Territories of Goa, Daman, Diu and Dadra Nagar Haveli are the major beneficiaries of the station. Vindhyachal power station has been rated as one of the top 10 power stations of the country during the year 2005-06.

NTPC is Indias largest power generation company, with 14 coal based, 7 gas based and 4 JV power stations. The company has now grown into a multi location and multi fuel company. With the commissioning of the unit, the total installed capacity of NTPC Limited has risen to 27404 MW.

Cochin Shipyard delivers 2nd platform supply vessel to Deep Sea Supply

Cochin Shipyard Ltd has delivered a platform supply vessel to Deep Sea Supply of Norway last week. This is the second of a series of 8 ships being built for this owner.

The vessel is one of the popular UT 755 L design by Rolls Royce ship technology group and there are about 120 vessels of this design which is already built or being built all over the world. It is designed for satisfying the specific demands of the offshore industry for transport of deck cargo, pipes, liquid cargo, cement etc and unloading to rigs and production platforms and pipe laying barges.

A press release said that these vessels are the workhorse of offshore oil field industry, which acts as a lifeline carrying all operational supplies and stores to far off offshore installations.

CSL is constructing 19 platform supply vessels for European clients. Apart from this, 3 bulk carriers for Clipper Bahamas are under advanced construction. The total order book of CSL is 22 ships amounting to over INR 2,000 crore excluding the Air Defense Ship for the Indian Navy. CSL has also proposed a small ship division, which has received in principle approval from the shipping ministry and planning commission.

CSL's ship building achievement this year was an all time high of 179,000 DWT surpassing the previous best of 110,206 DWT achieved in 2005-06 and its net profit is expected to be around INR 50 crore in 2006-07 with a turnover of INR 800 crore.

Suzlon facing land problems in Maharashtra

BL reported that as many as 44 wind turbines operated by Suzlon in Sangli District in Maharashtra have been shut down following protests from local residents demanding more money for their land.

Dr Anil Kane corporate adviser of Suzlon told Business Line that the company has 222 MW of installed capacity in Sangli, of which 74 MW has been shut down and it works out to 34% of the installed capacity.

Mr Vivek Kher spokesperson for Suzlon said that though the company has been facing this problem for sometime, it has now reached a stage where its power production is seriously affected. Mr Kher added that "Despite our efforts to resolve the matter, we have not been getting enough support from the state government officials. The issue has reached such a stage that we are forced to defer the installations of turbines in some sites in Sangli and Dhule and shift some of the turbine installations to the neighboring state of Gujarat. We are also forced to cancel the turbine installations in a few other sites in Maharashtra."

PTC India ties up for 6676 MW power trading

PTC India Ltd announced last week that it has entered into long term agreements for power purchase for 6 projects totaling a capacity of 3144 MW and power sale relating to 6 projects for 2314 MW reaching the cumulative capacity tied up through long term projects to 6676.3 MW.

PTC also said that it has entered into MOUs with another 35 projects totaling to a capacity of 16,703 MW, for which power purchase and sale agreements are being negotiated.

As per Indias national power tariff policy, long term procurement of new power capacity by state power utilities & distribution companies is mandated to be through competitive bidding only. PTC has adapted its business model to this change and has participated successfully in several competitive bidding processes in states.

ADB to loan USD 620 million to MP's power sector

It is reported that Asian Development Bank is extending a USD 620 million (INR 2,790 crore) loan to Madhya Pradesh's power sector which will run from 2007 to 2012. The investment program will run from 2007 to 2012 and involves funding from the Madhya Pradesh government as well as the private sector.

ADB will source the funding for the facility from its ordinary capital resources. ADB funding will be disbursed in 5 tranches. The first 2 tranches of the facility will have a principal repayment period of 20 years excluding a 5 year grace period and terms of future tranches to be sourced from the facility may vary.

The loan would be used to finance projects involving energy efficiency improvements in transmission, distribution and nonphysical investments facilitating strategic public private partnership in distribution as well as the establishment of the energy conservation fund and other energy efficiency initiatives. The proposed ADB investments will almost reduce transmission and distribution losses from about 41% to about 23%.

ADB had also approved a USD 350 million loan to support the Madhya Pradesh Power Sector Development program in 2001 to facilitate the restructuring of the power sector and boost efficiency through technical investments.

SKF to set up a bearing unit in Uttarakhand

It reported that SKF India will invest over INR 150 crore in setting up a new manufacturing site in Haridwar in Uttarakhand. The new bearing factory situated over an area of 40,000 square meters. It is likely to raise the existing ball bearing capacity by more than one-third and will be operational in March 2008.

Mr Rakesh Makhija MD of SKF India said that "Uttarakhand is an emerging industrial hub within the country. SKF's move to increase production capacity signifies our commitment to serve our customers effectively. It also reinforces our leadership position in the Indian subcontinent."

SKF India has launched its range of power transmission products in February 2007 offering customers an integrated solution for all their transmission needs.

Ternium to obtain control of Mexican Grupo Imsa

Ternium SA announced that it has entered into a definitive agreement under which it expects to obtain control of Grupo Imsa SAB de CV in Mexico for a total consideration or equity value of approximately USD 1.7 billion. Ternium will finance the transactions primarily through debt, for which bank commitments have been secured. The transaction is subject to Mexican and U.S. antitrust clearances, approval by the Mexican securities regulator, and other customary conditions. It is expected to close in the third quarter of 2007.

Under the agreement, Ternium, or any of its subsidiaries, will make a tender offer in accordance with applicable Mexican law for all of the issued and outstanding share capital of Grupo Imsa at a price of USD 6.4 per share. Concurrently with the consummation of the tender offer, Grupo Imsa's majority shareholders, owning approximately 90.4% of Grupo Imsa's issued and outstanding share capital will have their shares redeemed in cash at the same price per share.

Grupo Imsa is a steel manufacturer with operations in Mexico, the United States and Guatemala. It has an annual production capacity of 2.2 million tonnes of hot rolled coils, 1.8 million tonnes of cold rolled products and 1.7 million tonnes of galvanized products. In addition, Grupo Imsa produces panels and other steel products. Grupo Imsa had net sales of USD 3.4 billion in 2006.

Mr Paolo Rocca chairman of Ternium's said "Upon the completion of this transaction, Ternium will strengthen its position in North America, where more than 60% of its revenues will be concentrated. The integration of Imsa will expand Ternium's industrial capabilities in value added steel products in Mexico and in the USA, where it will have a team of more than 13,000 highly trained and committed employees."

Ternium is one of the leading steel companies in the Americas, producing a wide range of flat and long steel products. With operations in Mexico, Argentina and Venezuela and 18,000 employees, Ternium had net sales of USD 6.6 billion and a production of 9 million tonnes of finished steel products in 2006.

China unveils list of steelmakers for shutting down

Industry Department of Chinas National Development & Reform Commission has unveiled the first list of steelmakers in 10 Chinese steelmaking provinces and municipalities which are required to phase out or close down outdated steel capacities prior to said deadlines. The statement came shortly after the written commitments signed last Friday by 10 steelmaking provinces & municipalities to eliminate obsolete capacities by the end of 2007 or prior to 2010.

The list specifies the steel maker's names, volume & capacity of the blast furnaces, EAFs & converters to be shut down and the deadlines for such capacity closedown.

Involved in the list are 1 steelmaker in Beijing, 35 in Hebei, 172 in Shanxi, 7 in Liaoning, 58 in Jiangsu, 15 in Zhejiang, 4 in Jiangxi, 17 in Shandong, 2 in Henan, and 33 in Xinjiang.

Nr Ma Kai director of NDRC at a high level television conference targeting energy saving and pollution last Friday revealed that 10 provinces and municipalities, i.e. Beijing, Hebei, Shanxi, Liaoning, Jiangsu, Zhejiang, Jiangxi, Shandong, Henan, Xinjiang, have signed written commitment to shut down and eliminate outdated iron making capacity and obsolete steelmaking capacity of 39.86 million tonnes and 41.67 million tonnes respectively in the next five year with 22.55 million tonnes and 24.23 million tonnes to be closed down by the end of 2007. Mr Ma added that such capacity slashing campaign will be extended to other provinces with more written commitments on the way.

In a nationwide context, the entire China targets elimination of outdated iron making capacity and steel making capacity of 30 million tonnes and 35 million tonnes respectively by the end of 2007 and eventually 100 million tonnes and 55 million tonnes respectively to be phased out by the end of 2010.

(Sourced from MySteel.net)

Court rules against Xstratas McArthur River zinc plans

It is reported that an Australian court recently ruled against an AUD 110 million (USD 92 million) redevelopment by Xstrata plc of the giant McArthur River zinc mine after a challenge by local landowners.

The decision by the Supreme Court of the Northern Territory overturns an earlier ruling giving Xstrata permission to proceed in 2006 after a lengthy legal battle but the court found the government did not follow the correct legal approval process. Supreme Court agreed proper procedures under the Mines Management Act were not followed.

The mine opened in 1995 as an underground operation yielding 320,000 tonnes annually of lead and zinc in bulk concentrate, or ground ore, form. Xstrata wants to dig a new underground mine at the mine to replace an ageing open pit operation that is running out of rich ore, requiring the diversion of the McArthur River for 5.5 kilometer. Environmentalists fear that prolonged rainy seasons in the Territory pose a significant risk that contaminated seepage from mining and milling will reach the 300 kilometer long McArthur River.

Xstrata said the decision was disappointing and it would carefully consider the judgment in the coming days but did not say whether it would appeal.

Chinese steel majors post 282% YoY increase in Q1 profits

According to the China Iron and Steel Association, 99 large and medium-sized steel plants in China reported a YoY 282% rise in net profits in January to March 2007 quarter.

Mr Luo Bingsheng deputy secretary general of CISA said that combined profits of these steel plants jumped to CNY 34.5 billion (USD 4.5 billion) in the first three months due to increase in steel prices. He said that the composite price index of steel products stood at 109.8 by end March, 4.42% higher than the beginning of 2007.

The 99 steel enterprises posted an industrial output value of CNY 390.8 billion up by 37.99% YoY and their sales shot up by 39.34% YoY to CNY 431.6 billion.

Mr Bingsheng said that China's double digit economic growth has been fuelling steel consumption in its road and factory construction.

CVRD to move ahead with Goro nickel project

Companhia Vale do Rio Doce has signaled its confidence in the nickel market by granting final board approval for the USD 3.2 billion Goro laterite project in New Caledonia despite years of delays cost blow outs and disputes with locals.

Mr Roger Agnelli CEO of CVRD told Brazilian media recently that "We think the nickel market is really very strong. Customers have been asking for more products so we've brought these demands home."

Goro has been one of the most watched developments in the world amid speculation that CVRD could cancel it and place further pressure on the already tight nickel market. This was after CVRD reassessed the project, it gained through the purchase of Canada's Inco in 2006.

Inco had originally planned to start production at Goro in 2005 with a total budget of USD 1.45 billion, less than half the final price tag. CVRD expects Goro will produce its first nickel by the end of next year or early 2009, with production eventually ramping up to 60,000 tonnes a year.

The nickel price has reached record highs of more than USD 50,000 a tonne this year amid increased demand for the stainless steel ingredient. But the cost of large building projects needed to lift global nickel supply has also increased.

Peruvian mining workers begin strike

A national strike by mine workers in Peru has spread to half the industrys unions, threatening to disrupt global supplies of metals such as copper, zinc and gold after 4 days of lengthy negotiations between the federation and the labor ministry to avert the strike failed on Sunday.

The walkout began at midnight local time. Workers at 33 unions of 70 mining unions joined the strike, including employees of Southern Copper Corp, Doe Run Resources Corp and Pan American Silver Corp. The miners' federation claimed that as many as 40,000 members had joined the strike out of about 110,000 miners estimated to be work in the mining sector overall. The National Federation of Mining, Metallurgy and Steel Workers, which represents some 22,000 miner said that the strike is indefinite.

Mr Jorge del Castillo prime minister of Peru described the strike as a complete flop. Perus labor ministry in a statement said "In the coming hours, the strike will be declared illegal and any worker who has been absent from work for three straight days after that may be fired by his employer." It is not immediately clear if the union could appeal the measure and continue with the protest.

The majority of Peru's mines are controlled by large multinational companies, whose profits have surged on high metals prices. Miners are seeking a greater share of profits and better pensions as surging metal prices generate record earnings for producers.

The last nationwide strike took place three years ago, when miners stopped work for 48 hours to protest the previous government's labor policies.

Peru is the worlds largest producer of silver, the 3rd largest in zinc, copper and tin and ranks 5th in gold. Mining is Peru's main economic drivers and accounts for more than half of export earnings. According to the Web site of Peru's Energy and Mines Ministry, Peru produced 1.05 million tonnes of copper, 203,269 kilograms of gold, 1.13 million tonnes of zinc and 1.3 million kilograms of silver in 2006.

Liberian Senate approves Mittal Steel iron deal

Liberian government announced that USD 1 billion iron ore mining contract with Arcelor Mittal has been approved by the Liberian Senate. Liberia's upper house of parliament approved the project in a special session late on Friday and the lower house endorsed the project last week. In a final formality, Ms Ellen Johnson Sirleaf president of Liberia is now due to sign the agreement for it to be promulgated.

Mr Lawrence Bropleh information minister of Liberia announced the formal ratification. He said "This agreement is a significant step. The contract is expected to create about three thousand jobs for our people. Mittal Steel is a huge company and its operation in Liberia will mean a lot for the people of this country.

In November 2005, the erstwhile National Transitional Government of Liberia, headed by Mr Gyude Bryant, entered into a Mineral Development Agreement with Mittal Steel for mining of iron ore in Yekepa, Nimba County, formerly mined by the Liberia American Mining Company that folded as a consequence of the Liberian civil crisis. Ms Johnson Sirleaf led government renegotiated last year an initial Mittal Steel agreement boosting the state's interest in the deal and raising the investment from USD 900 million. The revisions to the accord ensured the Liberian state would retain control of its main port of Buchanan and a railway serving the mine, both of which had been awarded to the steelmaker under the original agreement.

The renegotiated vision of the Mittal Steel Agreement was then sent to the National Legislature for ratification, where it stayed over three months, with members of the first branch of government identifying flaws and vowing not to hastily rectify the Act. Following months of debates and public hearings with the management of Mittal Steel, government officials, mining experts and civil society organizations, the House of Representatives, a week ago, ratified the Agreement with onward transmission to the Liberian Senate for concurrence. The Liberian Senate which heard series of debates and hearings, last Friday finally concurred with the House of Representatives and ratified the Agreement, thereby giving the largest steel company the green light to resume full scale mining activities in the country, expected to provide thousands of job opportunities to Liberians.

The 25 year deal signed in December 2006 gives Mittal Steel the right to mine a huge, high quality ore body in northwest Liberia with reserves currently estimated at 500 million tonnes of iron ore.

Chinas Q1 steel outputs and exports up in Q1

After the release of steel output, consumption and export figures during January to March 2007 quarter by China Iron & Steel Association, many uncertainties have come up.

In million tonnes
Change is with respect to January to March 2006 quarter

China exported 1.781 million tonnes of billets in Q1 and imported 80,000 tonnes.

Supply and demand were in basic balance. Market demand kept on rising. There were also many uncertainties as follows

First, the basic balance in Q1 was reached by high exports. In Q1, China reached an accumulative net export of 12.072 million tonnes of crude steel in Q1 accounting for 57.66% of 20.944 million ton fresh crude steel outputs. Under such circumstances, balance between supply and demand in domestic market will be broken if steel and billet exports fall down in the future, leading to sharply rising domestic supplies.

Second, China's apparent consumption of crude steel went up by 12.51%YoY; GDP by 11.1% YoY, social fixed asset investment by 23.7% YoY, total foreign trade value by 23.3% YoY. Against such backgrounds, Chinese government will strengthen macro control to cool down the economy overheating and prevent fixed asset investment from rebounding up. Besides, the government will also curb outputs of high energy consumption products. Thus Chinas domestic demand will climb up with slower growth.

(Sourced from MySteel.net)

Kobe Steel to increase 2007 FY CAPEX by 15% YoY

Kobe Steel Ltd plans capital investments of JPY 110 billion in fiscal 2007 ending March 31st 2008 up by 15% YoY from the estimated JPY 96 billion in fiscal 2006. Most of the investments are in the Iron & Steel segment and the Aluminum and Copper segment to improve the manufacturing capabilities of upper end products that increase the competitiveness of the company.

For the stable production of steel products, Kakogawa Works will complete the refurbishment of its No 2 blast furnace, while Kobe Works will reline its blast furnace. In the Aluminum and Copper segment, work will continue at the Chofu Plant on the upgrade of the cold temper rolling mill and installation of a new plating line. In addition to environment related investments, other work includes modernizing and necessary repairs.

Construction costs and outlays are as under (Parent only)

In JPY billions
E is estimated
P is planned

Iron & Steel segment figures are a subset of each category.

Depreciation in fiscal 2007 includes the effect of a change in the depreciation method due to a revision in the tax system

Investments by segment (Parent only, construction cost basis)

In JPY billions
E is estimated
P is planned

The main projects for fiscal 2007 are as follows

Iron & Steel Segment

Aluminum & Copper Segment

Aluminum & Copper Segment

The highest capital expenditure in the past 20 years was 186 billion yen in fiscal 1991. Kobes capital investment in previous 10 years is as under

In JPY billion

Laiwu Steel to increase H Beam production in 2007 by 25% YoY

Bloomberg last week reported that China's biggest producer of H beams Laiwu Steel Group will boost output of the product 25% in 2007 as China economic growth boosts demand.

Mr Zhang Shengsheng VP of Laiwu Steel Group during a recent conference at Beijing said that Laiwu Steel Group will boost H beam production to 3 million metric tons in 2007. Mr Zhang said H beams and sheet products are the priority in our development. It will only use 86% of its capacity for making H beams this year as it upgrades one of its production lines.

Shandong province based Laiwu Steel and other Chinese mills which supply a third of the world's steel are shifting output to higher grade bars and beams used in buildings and sheets used in automobiles and appliances to tackle overall steel market excess capacity.

Arcelor Mittal is waiting for Chinese government approval to buy a 38% stake in Laiwu Steel Corp the listed unit of Laiwu Steel Group. Arcelor agreed in February 2006 to buy the stake for CNY 2.1 billion (USD 272 million) from Laiwu Steel Group but the proposal has not been approved by Chinese government so far.

LISCO to expand to 4 million tonnes by 2010

It is reported that Libyan Iron and Steel Company is planning to boost its production capacity of liquid steel up to 4 million tonnes by 2010. LISCO's plan for expansion and increasing the production capacities comes as a need of the hour to meet the demand from the domestic market.

Early this April, the company signed an agreement of a financing loan with the Libyan banks for LYD 840 million to execute this plan, in addition to the allocations made in the development budget for LYD 250 million to expand the port and maintain the electricity, water and gas station.

Dr Mohammad Zidan GM of LISCO said that it plans to increase its production of iron and steel products in 2007, which in 2006 for the second consecutive year exceeded 1 million tonnes. The production figures achieved in 2006 exceeded the design capacities of the company's mills.

TKC Steel to buy Zhangzhou Stronghold & Treasure Steelworks

TKC Steel Corp announced that it plans to acquire 90% of Zhangzhou Stronghold Steel Works Co Ltd in China's Fujian province and 100% of Treasure Steelworks Corp in Iligan province in southern Philippines. No details were given about the purchase prices for them.

Zhangzhou Stronghold produces pipes for use in the oil and gas industry in China and other markets in Southeast Asia.

Treasure Steelworks operates a billet plant in the Philippines with an annual rated capacity of 300,000 tonnes.

The acquisitions will be funded by an equity infusion of PHP 680 million from its majority shareholder Star Equities. TKC also plans to raise additional capital through a follow on offering within the fourth quarter of this year, which will be used to expand its business in China.

TKC said it has appointed First Metro Investment Corp as its financial adviser and issue manager for the capital raising exercise.

Sinosteel regroups Jilin Ferroalloys Co Ltd

Sinosteel Corporation has signed a contract for the regrouping of Jilin Ferroalloys Co Ltd, under which Sinosteel will take shares of Jilin Ferroalloys that previously were owned by state owned Assets Supervision and Administration Commission of Jilin Province and will increase investment together with the latter by CNY 300 million and CNY 100 million respectively.

Jilin Ferroalloys Co Ltd is one of the 156 key projects in China's first Five Year Plan. Its annual capacity has risen to 550,000 tons from original 44,000 tons.

Sinosteel will support Jilin Ferroalloys Co Ltd's development, in virtue of its mineral resources and marketing strategy, to integrate the country's ferroalloy industry. After the regrouping, Jilin Ferroalloys Co Ltd will raise production capacity and adjust product mix. It aims to lift capacity to over 700,000 tonnes in 2008 and produce 1 million tonnes in 2010.

(Sourced from MySteel.net)

Chinas coke exports in March up by 86% MoM

Statistics from Chinese Customs show that Chinas coke exported in March 2007 jumped remarkably from a month earlier. In March 2007 China exported 1.526 million tonnes of coke as compare to 705,400 tonnes or 86% MoM more than that in February 2006 with a YoY increase of 451,600 tonnes or 42%.

Besides fewer days as well as China's Lunar New Year in February bloomy global demand and tight home supply and rising domestic price push up export market in March.

As per report Shanxi, Tianjin, Xinjiang, Jiangsu and Heilongjiang contributed most to March exports with Shanxi taking the lead at 515,000 tonnes while Shandong, Liaoning and Yunnan reported few exports.

(Sourced from MySteel.net)

Outokumpu to set up SS service centre near Katowice in Poland

To service the growing Eastern European market Outokumpu has decided in March end to set up a new stainless steel Service Centre in Southern Poland near Katowice. The total investment is some EUR 20 million and the Service Centre is scheduled to be operational by the end of 2008.

The selected site near Katowice is connected to the region with optimal road and rail connection. The operation will be a combination of a coil service centre with slitting and cut to length lines together with a plate service centre with plasma and water jet cutting.

Mr Jan Myczkowski GM of Outokumpu Poland said "Outokumpu has a long-standing presence in Poland and in the region and has until now served the market through sales companies. Now the setting up of the new Service Center will enable us to take advantage of the growing market, both related to the volume and added value products. The state of the art facility will enable us to execute the company vision to be the undisputed number one in stainless in Eastern Europe, as well."

The Service Centre will serve Poland and other countries in the region like Czech Republic, Slovakia and Hungary and will challenge new potential markets in Eastern Europe.

German IG Metall begins warning strikes

Metals Insider reported that Germany's powerful trade union IG Metall, which represents workers in the Germanys metals industries, said that it began a series of warning strikes over the weekend to apply pressure in the annual round of wage talks with employers.

As per report there is a big gap between the two sides negotiating positions. The union is demanding a 6.5% wage hike with employers offering only 3%.

The preliminary actions are expected to escalate into wider spread walk outs this week in what is a tried and tested tactic by IG Metall in previous stand offs with the employer federation Gesamtmetall.

Air Products completes purchase of BOC Gazy from Linde

Air Products announced that it has completed the acquisition of the industrial gas business of BOC Gazy Sp zoo from The Linde Group for EUR 370 million. Air Products had earlier announced on January 8th 2007 its intention to acquire the BOC Gazy business and has since received clearance from the European and Polish regulatory authorities.

BOC Gazy headquartered in Warsaw have five major industrial gas plants and six cylinder transfill facilities serving customers across a diverse range of industries, including chemicals, steel and base metals, among others. Combined with Air Products' existing Polish business, 2006 sales were about EUR 140 million.

Mr John McGlade, president & COO of Air Products said that "This is a very compelling investment for Air Products. We now have the assets, infrastructure, people and management talent to take full advantage of the opportunities that come from having the leading position in one of the world's fastest growing economies. Poland is the fourth largest recipient of foreign direct investment next to China, India and Brazil. Our combined operations are in the industrial heartland of the region where we can bring new applications and technology to drive quality, efficiency and performance in our customers' businesses."

Air Products Founded in 1940 operates in 15 countries throughout Europe, including the central and eastern European countries of the Slovak Republic, the Czech Republic, Russia and Poland. Total European sales in Air Products 2006 fiscal year were approximately USD 2.6 billion.

Angangs Q1 net profit doubles YoY

Liaoning based Angang Steel announced that its net profit in January to March 2007 quarter more than doubled. Angang Steel in a statement to the Shenzhen stock exchange said that its net profit, based on Chinese accounting standards, for January to March 2007 surged to CNY 2.39 billion compared to CNY 1.13 billion in January to March 2006. Its revenues in the quarter also jumped up by 32.6% YoY to CNY 16.02 billion up from CNY 12.08 billion in Q1 of 2006 and operating costs went up by 19% YoY to CNY 12.4 billion.

Following the strong first quarter performance, Angang said it expects first half earnings to be boosted by 50% to 70% on a continuing trend. Mr Tang Fuping VC of Angang said earlier this month that although a reduction in the export tax rebate would have an impact on us, the rise in market prices could counter this.

Angang expects steel output in 2007 to hit 16 million tonnes up from 15.2 million tonnes in 2006. In 2006, the company's net profit more than tripled to CNY 6.845 billion after it acquired assets from its parent, Anshan Iron & Steel Group.

USs steel production continues to remain week in last week

US domestic raw steel production was recorded 2.032 million net tons while the capability utilization rate was 84.9% in the week ending April 28th 2007 as compared to production of 2.189 million net tons in the week ending April 28th 2006 when the capability utilization then was 91.4%. The current week production represents a 7.1 % decrease from the same period in 2006.

Production for the week ending April 28th 2007 is also down by 0.5% from the previous week ending April 21st 2007 when production was 2,043 million net tons and the rate of capability utilization was 85.4%

Adjusted YTD production through April 28th 2007 is 33.539 million net tons at a capability utilization rate of 83.9%, 7.3% decrease from the 36.271million net tons during the same period last year when the capability utilization rate was 89.6%.

AISIs estimates are based on reports from companies representing about 75% of the USs raw steel capability.

5 dead and 10 missing in coal mine blast in Shanxi

It is reported that 5 people were found dead and 10 missing in a blast at an illegal coal mine located at Liujiacun village of Yuxian in Yangquan City of Shanxi province in China. The accident took place at about 3.40 AM.

A spokesman with Coal Mine Safety Administration said that four other people have been rescued group and a group of rescuers led by Mr Jin Shanzhong vice provincial governor are searching for the missing people. But he did not give further details, saying that the cause of the blast and the exact number of casualties is still being investigated.

China to produce 50,000 tonnes of nickel pig iron in 2007

It is forecasted that China will produce 50,000 tons of nickel pig iron in 2007, although government think rapidly growing output maybe a disaster for country environment.

Mr Alan Heap of Citigroup said that China government has no intention to take some tightening measures to curb the output because Chinese market acutely short of nickel.

In past, Chinese government has tried to shut down blast furnaces for highly polluting and energy intensive units. But they were reopened to produce nickel pig iron due to the shortage of nickel required by booming stainless steel sector.

Cape Lambert to start drilling in its iron ore project

Cape Lambert Iron Ore Ltd announced that it expects to start drilling on its iron ore project in Western Australia by the end of April with another 10,000 m diamond core drilling program scheduled to begin in June.

Cape Lambert Iron Ore said its objective is to define sufficient ore reserves to produce 10 million tonnes to 15 million tonnes per annum of magnetite concentrate over a 20 year mine life. The company also said it expects to complete a resource update by the end of July.

Mr Ding Liguo a Chinese businessman last month entered into a contract to acquire 40 million Cape Lambert options, giving him a 13.7% stake in the company on exercise.

Olympic Steels announces Q1 results

US national steel service center Olympic Steel Inc announced its financial results for the Q1 of 2007. Its net sales for the Q1 of 2007 totaled USD 259.4 million an increase of 8.6% YoY as compared to USD 238.9 million in Q1 of 2006. Olympic Steel said that its net income totaled USD 5.3 million in Q1 2007 as compared to net income of USD 8 million during Q1 of 2006.

Olympic Steels sale during January to March 2007 quarter decreased by 7.9% YoY to 312,000 tonnes from 338,000 tonnes in the first quarter of 2006, which is almost in line with the Metals Service Center Institute statistics of a 7.4% decline in YoY flat rolled shipments for the first quarter of 2007.

Mr Michael D Siegal Chairman & CEO of Olympic Steel stated We are pleased to report improved sales and earnings performance over the fourth quarter of 2006. The first quarter carbon steel market was quite challenging, as the year began with high inventories at steel service centers, causing a very competitive landscape.

Mr Siegal added that Looking forward, carbon imports continue to be low, steel making input costs such as scrap and pellets have risen, service center inventories are now at more balanced levels and demand appears to be slowly recovering, leading to a potential improving price and earnings environment for the second quarter of 2007.

He said On a longer term view, we are increasing our capital spending in new equipment, facilities and technology solutions to support future growth. In 2007, we have placed orders for a new Red Bud stretcher leveler cut to length line in Minneapolis, and new laser, plasma, and machining equipment in Cleveland and Chambersburg to support our growing value add services. We have also broken ground on an expansion to our existing Iowa facility, and our previously announced new IT system project is proceeding on plan.

Founded in 1954, Olympic Steel is a leading US steel service center with headquarter at Cleveland in Ohio and operates 16 facilities. Olympic Steel is mainly focused on the direct sale and distribution of processed carbon, coated and stainless flat rolled sheet, coil and plate steel products.

Lebedinsky offers to buy stake from minority shareholders of Mikhailovsky GOK

Lebedinsky GOK in an announcement last week said that it set an offer on purchasing common shares from minority shareholders of Mikhailovsky GOK accounting for 1.43% stake. At present Lebedinsky GOK controls 98.57% of MGOK shares

As per report the price of one Mikhailovsky GOK common share was fixed at RUB 13.685. The offer affects within 70 days from the date it has been received. Bank of Moscow is the guarantor.

Mikhailovsky GOK is the largest Russian enterprise principally engaged in the production of iron ore raw materials. In 2006 MGOK increased concentrate output by 12.8% to 17.1 million tons. In IQ 2007 the plant remained production on the previous year level. MGOK ranks second in terms of ore reserves and second in terms of iron ore raw metal production. Its consumers are the biggest Russian, European, American, and Chinese steel producers. Its reserves total 11 billion tons.