TATA Steel and Essar get approval for Bailadila iron ore deposits

PTI reported that TATA Steel and Essar Steel have received the approval from central government to prospect more than 250 million tonnes of iron ore in Bailadila mines in Chhattisgarh for their proposed steel projects with a total capacity of 8 million tonnes.

Mr J Mehra CEO of Essar Steel Holdings told PTI that "The Centre has accorded its approval to allow us to prospect Bailadila III deposit in Chhattisgarh. We are awaiting forest clearance from the government and will commence work only after receiving it. "We will complete prospecting within six months after we began the work.” Prospecting would be done on more than 2,000 acres of land and it is expected that the deposit has about 150 million tonnes of iron ore.

Essar Steel had signed an MoU with the Chhattisgarh government to set up a 3.2 million integrated steel plant at an estimated cost of INR 7,000 crore.

TATA Steel has also received the government's nod for prospecting the Bailadila I deposit that has an estimated reserve of up to 150 million tonnes.

TATA Steel plans to build a 5 million tonnes steel plant at Bastar in Chhattisgarh at an estimated investment of about INR 10,000 crore.

Indian coal reserves up by 4 billion tonnes

Dr Dasari Narayana Rao union minister of state for coal informed the parliament that the exploration activity has established additional resources during 10th Plan period in several coalfields including Orissa and West Bengal. Dr Rao said that during the January 2006 to March 2007 period, 4.080 billion tonnes of new coal resources have been estimated in India.

Geological resource of coal in India, prepared by Geological Survey of India, has increased by 4.080 billion tonnes as indicated below:

In billion tonnes

Dr Rao further informed that out of the total addition of coal resources mentioned above 520 million tonnes have been estimated in the state of West Bengal and 1234 million tonnes in the state of Orissa. The state wise and coalfield wise details of estimation of additional coal resources in blocks where exploration has been concluded during the period from January 2006 to March 2007 are given as under

In million tonnes

Dr Rao added that based on the potential of the blocks revealed from regional exploration data the detailed exploration is under process in different blocks areas.

Last 10 decades of TATA Steel

As per a release of TATA Steel, on the occasion of completion of 100 years of its existence, the important milestones in the last 10 decades have been as under.

Decade I - (1907 - 1917)
On August 26th 1907, the TATA Iron and Steel Company, now TATA Steel Limited, was registered and shares were issued to the Indian investors. It obtained its first collieries in 1910 and the first ingot of steel was rolled out in February 1912. The Company introduction of an eight hour working day for laborers and employees, long before these were enforced by law in this country. The Greater Extension Scheme was launched in 1916 to raise capacity to 450,000 tonnes and diversify production.

Decade II - (1917 - 1927)
In acknowledgement of TATA Steel’s contribution in the allied war efforts, Lord Chelmsford visited Sakchi and renamed it Jamshedpur. Jamshedpur Technical Institute was opened in 1921 with 23 students on board. The New Rail Mill, Merchant Mill and Sheet Mill went into operation in 1925.

Decade III - (1927 - 1937)
Netaji Subhas Chandra Bose, then President of the Jamshedpur Labor Association, visited Jamshedpur in 1928 and a historic agreement was signed between him and Sir NB Saklatvala chairman of TATA Steel and Mr CA Alexander general manager. Profit Sharing Bonus was granted for the first time in India in the year 1934.

Decade IV - (1937 - 1947)
"A" Furnace was 'blown in' into operation on December 17th 1939. Special steel for war purpose was manufactured during the years 1941-42. The period of one year between 1942 and 1943, was characterized by the efforts of the Steel Company to produce a wide variety of special steels required for defense purposes including armored cars called ''Tatanagars''. TATA Steel's step towards nation building was in 1943 with the construction of Howrah Bridge.

Decade V - (1947 - 1957)
The Community Development & Social Welfare Department was established in 1951 with the objective to address issues arising out of urbanization in Jamshedpur. The Two Million Expansion plan was undertaken in 1953-54. To address the problem of Population explosion, in 1954, Mr JRD Tata initiated Family Planning. Bipartite Agreement in 1956 saw a landmark agreement in India, when the union and the management agreed to participate in a 3 tier system of joint consultation on major issues.

Decade VI - (1957 - 1967)
The Ferro Manganese Plant commenced production at Joda in April 1967. This was a very special occasion for Joda, an otherwise remote valley. Modernization through IBM 1401 was introduced in 1967. At that time, Tata Steel was the first institutions in India to have gone for total computerization as part of a Modernization process.

Decade VII - (1967 - 1977)
TATA Steel Growth Shop, which was introduced in 1968, was not just a massive engineering workshop, but a symbol of self reliance.

Decade VIII - (1977 - 1987)
TATA Steel entered a new era of steel making with the commissioning of the 1.1. million tonne per annum LD Shop on 23rd March 1982. The First Phase of Modernization in 1984, TATA Steel introduced BOF steel making. TATA Steel Rural Development Society was established in 1979 to assist in irrigation, agriculture, safe drinking water, basic health care service, income generating activities, environment and forest protection, youth and women development programs in villages around Jamshedpur.

Decade IX - (1987 - 1997)
The Second Phase of Modernization was in 1988 when the Company concentrated largely on the iron making area. On March 2nd 1991, Jamshedpur received a sprawling, multi crore sports complex called JRD Sports Complex dedicated to JRD. Lifeline Express, the world's first hospital on wheels sponsored by TATA Steel was started in 1991, which provides basic medical facilities in remote rural areas. During the Third Phase of Modernization in 1994, TATA Steel set up an internationally competitive flat products complex. Apart from a one million tonne hot strip mill, a new one million tonne G blast furnace was also installed. The one million tonne per annum Hot Strip Mill, was commissioned on March 2, 1992. The First Slab Caster came into operation during 1993-94. The Third Phase of the Modernization Program was completed in 1994 - 95. TATA Steel became the First Steel Plant in India to be ISO - 14001 Certified. It received the Award for Best Integrated Steel Plant in 1994-95. The Company also received the Prime Minister’s Trophy for the Best Integrated Steel Plant for the year 1994-95. This award was subsequently conferred again in 1998-99, 1999-2000, 2000-01 and 2001-02.

Decade X - (1997 - 2007)
World Steel Dynamics recognized TATA Steel as India's only ''world-class steel makers'' thrice in a row. It started Cold Rolling Mill Complex in 2000. The Final Phase of Modernization was to bring about productivity enhancement through the expansion of the Hot Strip Mill from one million tonnes per annum to a two million capacity. TATA Steel launched the ''Green Millennium'' wherein 1.5 million trees were planted by the company across all its locations. It signed MoU's with the Sate Governments for its Green field Projects at Kalinga Nagar in Orissa in 2004 and in Bastar District of Chattisgarh. TATA Steel Limited signed four Memorandums of Understanding (MoUs) with the Government of Jharkhand not only for the Greenfield Project but also the enhancement of capacity of Jamshedpur Works. The current capacity of Works in Jamshedpur is 5 million tonnes.

TATA Steel's first step in the Global Market was when it acquired the steel business of NatSteel Limited, Singapore. It also signed a joint venture BlueScope Steel Limited of Australia in 2005 for setting up a metallic coating and painting unit. To boost the economy of South Africa and also add significantly to the Indian economy, TATA Steel commenced the work on Ferro Chrome Plant in 2006. On 2nd April 2007, TATA Steel acquired Corus for USD 12 billion, which made TATA Steel the sixth largest steel producer globally and the second most geographically diversified steel producer in the world. It also entered into an agreement to acquire controlling equity stake in two rolling mills located at Haiphorg in Vietnam. It signed MoU & MoC for an investment in a 4.5 million tonnes per annum plant in Vietnam.

Orissa contemplating re valuation of NINL assets- Report

NewIndPress recently reported that the proposed merger of Neelachal Ispat Nigam Limited with Steel Authority of India Limited may get a bit delayed as Orissa government is contemplating to go for revaluation of NINL shares.

The report cited some official as saying that Orissa government had engaged IDBI Capitals for valuation of NINL shares after it decided in principle for merger of the company with SAIL. The merchant banker evaluated the price of each NINL share at INR 27. However, the valuation appears to be very low to Industrial Investment Promotion Corporation of Orissa Limited, the other key promoter of the company. Raising some doubts over the parameters adopted by IDBI for valuation of NINL share, Industrial Investment Promotion Corporation of Orissa Limited recommended Orissa government to go for revaluation of MINL.

The report said that officials believe that the mines granted in favor of NINL were not taken into consideration during valuation of the company. Orissa government has earmarked 1,850 acres of iron ore mines in Sundargarh and Keonjhar districts to NINL however, the mining lease has not been executed due to lack of certain clearances from the center.

Neelachal Ispat Nigam Limited’s 1.1 million tonne capacity pig iron plant is located in Duburi of Jajpur district and Orissa government has provided 2,250 acres of land to the plant, which was planning to opt for capacity addition of four million tonnes. The annual production capacity of the plant is 0.492 million pig iron, 0.276 million tonnes of billets and 0.3 million tonnes of wire rod and beside, it has a 62.5MW captive power plant.

Orissa’s Industrial Investment Promotion Corporation of Orissa Limited has 22% share in NINL, the Orissa Mining Corporation has only 4% stake and the remaining are with MMTC and MECON.

PFC defers RFP for Krishnapatnam UMPP to September 21st

FE reported that Power Finance Corporation has once again deferred the submission of request for proposal to September 21st 2007 for the 4,000MW Krishnapatnam ultra mega power project in Andhra Pradesh. Originally, the submission of Request for Proposal was slated for March 9th 2007, which was deferred to April 11th 2007 and subsequently to May 25th 2007 and thereafter to August 24th 2007.

As per report, qualified bidders including TATA Power, Reliance Energy Ltd, NTPC, Essar, Sterlite, L&T, Torrent, AES, DS Construction and Sumitomo were in the midst of completing the necessary formalities including the bid bond of INR 120 crore to meet the deadline of August 24th 2007.

Power Finance Corporation roadmap for the bidding process for Krishnapatnam project had envisaged issuance of notice for request for qualification bidding process issue of RFQ documents, submission of bids, issue of Request for Proposal, submission of Request for Proposal, selection of developer, transfer of special purpose vehicle.

However, Power Finance Corporation time table has already gone haywire as it was recently involved in the resolution of controversy over the Sasan UMPP for the alleged misrepresentation made by Globeleq Singapore Lanco consortium. However, after the decision by the empowered group of ministers, the Globeleq Singapore Lanco consortium has been disqualified and the Sasan project been awarded to Reliance Energy Ltd.

IOC to increase pipeline capacity by March 2008

Mr Dinsha Patel union minister of state for petroleum & natural gas informed parliament recently that Indian Oil Corporation is planning to increase pipeline capacity from 61.718 million tonnes per annum as on March 31st 2007 to 75.480 million tonnes per annum by March 31st 2008.

The details of capacity addition and approved cost are as under

Capacity in million tonnes per annum
Cost in INR crores

PM calls for need to develop all type of energy resources

Dr Manmohan Singh Prime Minister of India while speaking at the laying of foundation stone of Rajiv Gandhi Urja Bhavan recently said that there is a need to develop all energy resources like coal, gas, oil, hydro and nuclear along with renewable such as wind and solar power.

Dr Singh said that “From a long term perspective, nuclear energy and solar energy can play an important role in addressing our energy security needs. Our government is committed to the development of nuclear energy. We are blessed with an abundance of solar energy, it could be a major energy source in the coming years and we must invest in research and development for commercial use of solar energy. Several non conventional energy sources fall in the domain of high technology and are presently commercially not viable and immediate need is to develop these technologies to make such energy available to the masses in the shortest possible time.”

He said that real energy security implies assured supply of good quality energy at affordable prices. He said “India’s energy needs, which will grow with the pace of economic development, cannot be met with oil and gas for long. Expressing his concern over the growing import bills for imported crude oil, he said that as we grow, import oil bill would put an unbearable and an unsustainable burden on our economy.

He said that “Today, when we aim for a 10% growth rate, we must recognize the critical importance of energy security. By energy security, I refer not merely to the assurance of the supply of energy in ample quantities. Real energy security implies assured supply of good quality energy at affordable prices. India’s energy needs, which will grow with the pace of economic development, cannot be met with oil and gas for long. Currently, the total domestic production by Indian companies is less than one third of our current domestic consumption of hydrocarbons. As we know, oil and gas reserves in India are quite limited though there is always a scope to discover a new reserve through exploration. As we grow, our growing import bill for imported crude oil will put an unbearable and unsustainable burden on our economy. Therefore we need to develop all our energy resources like coal, gas, oil, hydro and nuclear along with renewable, such as wind and solar power.”

Chhattisgarh becomes No 3 mineral producer in India

PTI reported that Chhattisgarh has become the 3rd largest producer of minerals in India just behind only Orissa and Jharkhand with record production worth INR 7000 crore during 2006-2007.

Officials said that Chhattisgarh has also earned revenues of INR 832 crore from minerals and in order to maintain this trend, the state government has decided to give priority to the mining of iron ore, coal, bauxite and lime stone in the current year's plan.

The officials added that besides, deposits of diamond have been found in Raipur, gold has been discovered in the Sonakhan area of the capital while Sitalpur Bhelwapani, Mitchgaon, Bhuski and Gardi in Kanker district also have precious metal deposits. Uranium has also been found in the Gotulmuta area in Durg district and the Indrawati river basin.

Update on ultra mega power plants in India

Union ministry of power had launched an initiative for the development of coal based ultra mega power projects, each of about 4000MW capacity, to be developed on a build, own and operate basis and the project developer is selected through a tariff based competitive bidding process.

The Central Electricity Authority in consultation with the states had identified the following 9 locations for these ultra mega power projects
1. Sasan in Madhya Pradesh
2. Mundra in Gujarat
3. Krishnapatnam in Andhra Pradesh
4. Akaltara in Chhattisgarh
5. Tadri in Karnataka
6. Girye in Maharashtra
7. Cheyyur in Tamil Nadu
8. Sundergarh district in Orissa
9. Tilaiya in Jharkhand

But so far only TATA Power Limited has been selected as the project developers for Mundra ultra mega power project and Reliance Power Limited has been selected as the project developers for Sasan ultra mega power project. In addition, the bidding process has been initiated in respect of the ultra mega power projects at Krishnapatnam in Andhra Pradesh and Tilaiya in Jharkhand.

Union ministry of power has taken up with the concerned state governments to provide the requisite clearances and examine the feasibility of alternate sites for development of the ultra mega power projects in their respective states.

Punjab to invest INR 2,000 crore in power sector

It is reported that Punjab government is planning an INR 2,000 crore investment to revamp the power infrastructure for urban and agricultural sectors in the state.

Under the plan, 301 new sub stations of different capacities including 13 of 220kV, three of 132kV, 188 of 66 kV and seven of 33/66 KV sub stations will be set up. In addition, the 47 existing sub stations will be upgraded, out of these 9 sub stations of capacity of 132kV to be upgraded as 220 kV, 11 of 66 kV capacity be upgraded as 220 kV and 27 existing sub stations with capacity 33 kV be upgraded as 66 kV sub stations under the new plan. Apart from setting up new substations and upgrading the existing units, over 12,000 circuit distribution lines across, the state will be modernized to transmit the increased power load.

According to proposed plan, INR 203 crore will be spent on up grading of power infrastructure in border areas that will be implemented in a given time frame to avoid additional stress on the distribution lines from the ever increasing demand.

Committee to study climatic change impacts formed

Mr Namo Narayana Meena union minister of state in the ministry of environment & forests recently announced that “Central government has set up the expert committee on impacts of climate change on May 7th 2007 under the chairmanship of Dr R Chidambaram principal scientific advisor to the government of India to study the impacts of anthropogenic climate change on India and to identify the measures that we may have to take in the future in relation to addressing vulnerability to anthropogenic climate change impacts.”

Dr RK Pachauri director general of the energy resources institute is also the chairman of the inter governmental panel on climate change, which has submitted its 3 working group reports recently.

These reports provides a global assessment of observed climate change, climate processes and estimates of projected or future climate change, impacts of climate change on natural, managed and human systems and their vulnerability etc. and provides findings at the continental level. No country specific findings for any country including India have been provided in these reports.

NTPC Kaniha laden with fly ash disposal problem

SNS reported that, with a whopping 25 million tonne of fly ash deposit in its 2 ash ponds, the National Thermal Power Corporation Kaniha authorities are worried about how to dispose it off, in order to make way for future accumulation and realizing the emerging threat, the authorities are working out a plan for ash disposal.

It is reported that NTPC has asked the central mine planning and design institute limited to submit a feasibility report to backfill any of the abandoned coal mines by ash accumulation.

Unless ash deposits are removed from ponds, stretching over about 1,600 acres of land, the plant may face problems in disposing off its fly ash in the near future. The daily production of fly ash from the six 500MW units are said to be around 20,000 tonne.

The report cited a NTPC source as saying that “It is amazing that despite being the best quality ash due to boiler design no one takes it, while at other NTPC plants like in Farakka, there is a rush to lift it free of cost. For Farakka plant’s ash mafias are emerging to control its sale both in India and abroad.”

Mr Somenath Banerjee executive director of NTPC Kaniha plant said that “We are ready to market our ash which is best suitable for construction works, cement industry, land filling, mine void filling and for use in agriculture, but so far no response has come.” He added that a small amount of ash has been taken by the Dhenkanal based Utkal asbestos which is doing extremely well in the market an hopes that once people are aware of its application there would be no problem for disposal.

BILT Power to set up a 1,200MW power plant in Orissa

BS reported that Ballarpur Industries Limited’s power outfit BILT Power is planning to set up a 1,200MW independent power plant in Orissa at an investment of around INR 6,000 crore. Discussion for the project is at the highest levels of Orissa government and a MoU is expected to sign soon.

BILT Power has already cleared the screening committee process for setting up the plant and requirements for setting up the independent power plant in Choudwar in Orissa on 950 acres have been forwarded to the state government. Funds for the project would be sourced through loans from banks and financial institutions in a debt equity ratio of 70:30.

Mr Anil Bhargava CEO of BILT Power said that “The detailed project report and feasibility study reports have already been submitted to the government. We are just awaiting the government nod to go ahead with the project.”

Currently, BILT Power aggregates 100MW of captive power plant capacity at Sewa in Yamunanagar in Haryana and 2 plants each at Pune and Ballarshah in Maharashtra with capacities between 25MW and 30MW each. BILT Power has also applied for allotment of coal blocks at Mandakini in the Talcher Coalfields of Orissa.

Sicals‘s Norsea buys dredger from Shanghai Duo

Sical Logistics Limited announced that it’s wholly owned subsidiary Norsea Offshore Private Limited has purchased a dredger for USD 25 million from Shanghai Duo Jun Dredging Co Limited, which will continue to be deployed in China.

The new dredger can dredge up to 25 meters and has a production capacity of 3,000 cubic meters per hour. It comes with a 24 meter 750 KW anchor handling tender boat.

Sical Logistics said that the acquisition was funded out of the proceeds of a foreign currency convertible bonds issue that it made in 2006. It expects that Norsea Offshore Private Limited will earn revenues of close to USD 10 million annually from the dredger.

Suzlon aiming to reach 5,000 MW capacity

It is reported that Suzlon Energy is targeting to reach 5,000MW capacity installations from the current 2,700MW by March 2008, to become one among the top 4 integrated wind energy manufacturers in the world and as part of this, it is in the process of investing about INR 3,310 crore at its Indian and overseas facilities.

Mr Tulsi R Tanti CMD of Suzlon Energy said that “As per the current ongoing expansion, our capacity will reach 4200MW and after the integration of the recently acquired German wind power turbine maker REpower by the third quarter of 2007-08, our total capacity will touch 5000 MW.”

He added that the acquired Belgian gearbox maker Hansen Transmissions is expanding its manufacturing capacity from about 3600MW to 5800MW with an investment of about INR 800 crore. In India, the capacity is added from 3500MW to 9300MW and the investment is to the tune of INR 980 crore. Suzlon is also setting up a Greenfield forging facility in Baroda with an investment of INR 250 crore, a foundry unit at a special economic zone in Coimbatore for INR 500 crore and a testing facility at Baroda for INR 30 crore. All the capacity additions are targeted to be completed by March 2008.

In the case of wind turbines, Suzlon has 1,500MW capacity in India and 600MW each capacity in China and US and an additional 1,500MW capacity is being added at Udupi in Karnataka with an investment of INR 750 crore.

Coking coal prices likely to rebound in 2008

Bloomberg reported that Coal used by steel makers might snap a three year slump in 2008 because of a decline in exports from China.

Mr Gerard McCloskey founder Chairman of McCloskey's said that exporters of Australian coking coal to Asia such as Rio Tinto Group and Xstrata Plc are likely to sell coking coal in 2008 at much higher prices than USD 98 per tonne in 2007. He said that “Australian producers would be profoundly disappointed if they get less than USD 130. Hard coking coal is the rarest commodity in the steel making process.''

Mr McCloskey said combined Chinese exports of coking coal and steam coal would fall to 50 million tons in 2007. Chinese coal exports were 72 million tons in 2006. He said that China's export and imports might be in balance in 2008 as it looks to retain as much of its own raw material as possible.

Mr McCloskey said more coal from the US might be exported to Asia next year to meet demand. US exports will fetch very high prices when shipping and insurance is included. More Canadian coal may also be transported across the Pacific.

Mr McCloskey said “Countries which relied on China, Japan, Korea, and Taiwan are increasingly worried about long term security of supply, and also short term security of supply. They have now taken to taking coal from South Africa.''

Coking coal benchmark prices are typically agreed to annually effective from the start of the Japanese fiscal year in April.

ThyssenKrupp Services to set up 2 service centers in Russia

ThyssenKrupp Services AG has announced investing of around EUR 18 million in the construction of two new warehouse logistics and processing centers in Russia to be used by ThyssenKrupp Materials.

ThyssenKrupp Materials has purchased five hectares of land in St Petersburg and 2.5 hectares in Nizhny Novgorod. The center in Nizhny Novgorod is expected to open in September 2008, followed a little later probably in May 2009 by the St Petersburg facility. Both sites will feature state of the art equipment such as flame cutting, band saw laser cutting and packaging lines.

Mr Joachim Limberg VC of the executive board of ThyssenKrupp Services said “The Eastern European economy is performing very well and Russia in particular is becoming increasingly attractive for our business. In the future we intend to establish high quality materials more strongly in Eastern Europe and further reduce the share of commodities. We will also continue to improve the quality of our products and services and expand our customer portfolio.”

In addition to Russia, ThyssenKrupp Services has Eastern European operations in Bulgaria, Poland, Romania, the Czech Republic, Ukraine and Hungary. These companies employ over 1,000 people and last fiscal year generated combined sales of around EUR 700 million.

BHPB sees India as a driver for energy business

It is reported that global mining giant BHP Billiton is confident of delivering nine projects in 2008 on time and budget and sees India as the driver for its energy business.

Mr Marius Kloppers incoming CEO of BHP Billiton told a briefing in Melbourne that “We are going to commission nine projects this year. These projects are getting very close to completion, that most of them will commission in the next six months some in the next twelve months, we have not far to go. We have appropriate contingencies in place to deliver them barring any really unforeseen events like a hurricanes."

Mr Chip Goodyear CEO of BHP was bullish about growth in India and China indicating the sub continent's growth had exceeded that of its neighbor. He said “We are actually seeing India grow faster than China, but from a much smaller base.”

Mr Kloppers added that demand from India is primarily focused on energy products, while China's hunger was for steel making materials. He said “China obviously is a large consumer of base metals, iron ore and so on but largely self sufficient in coal. What you have in India is a very energy short but largely self sufficient in iron ore and bauxite. India is going to drive our energy business.”

Gerdau to focus on overseas consolidation for expansion

It is reported that Brazilian steel maker Gerdau will focus on international market for expansion. Mr Osvaldo Burgos Schirmer financial director told the local press on that Gerdau's expansion plans have been targeting China, which is a globally important market, particularly when it comes to special steels. He stressed that the company will continue to focus on its consolidation abroad.

Mr Schirmer said that 55% of Gerdau's production capacity, of 17 million tons per year, is concentrated in the international market. It currently operates production units in the United States, the Dominican Republic, Mexico and Venezuela.

In June 2007, Gerdau and the Kalyani Group announced the creation of a joint venture to operate a steel plant in India, with a capacity to produce 275,000 tons of steel per year. Mr Schirmer explained that such strategy aims to allow the company to face foreign competitors and grow beyond the limits imposed by the Brazilian market.

However, he stressed that the global targets will not replace the domestic ones and the possibility of acquisitions in the local market is not discarded. He also revealed that Gerdau plans to expand its total capacity to 20 million tons up to 2009, with an investment of USD 1.3 billion over the next three years.

Steel scarp recycling in US holds strong despite low inventories

US based Steel Recycling Institute has announced that the recycling rate for globally most recycled material steel is 68.7%. This means more than 72 million tons of US domestic steel scrap was charged into furnaces, both in the United States and abroad to make new steel products.

As worldwide production of steel has continued to escalate, so too has the global demand for quality steel scrap. This increased demand has had some notable consequences. Prices for steel scrap remain significantly above the historical average price and as a result, inventories of steel scrap across America are at their lowest levels since World War II.

Mr Bill Heenan president of the Steel Recycling Institute said “As price goes up due to domestic and international demand for scrap, the collection effort increases in the local communities such that scrap peddlers go further and further out from the metro areas to gather scrap. This intensive effort has drawn down scrap reserves that typically accumulate during periods of lower scrap demand.”

One thing that will help meet this need for increased supply is that an increasing number of cities, including New York, Portland, and Seattle, are expanding their curbside programs to include light ferrous materials, such as toaster ovens, clothes hangers, and irons. The Steel Recycling Institute, through its regional operations staff, will continue to work with communities to increase the volume of steel being recycled and diverted from landfills.

Mr Heenan added that “We are actively working with recycling coordinators to educate them about the benefits of additional sources of steel scrap in their recycling programs. At the same time, we are increasing public and institutional education efforts to maximize the volume of steel that they are recycling so it gets back to the mills where it is needed.”

Mr Heenan said that “Steel continues to be recycled at a volume higher than all other recyclables combined, and the steel can still holds the distinction of being food’s and beverage’s most recycled container. As we continue to work with recycling coordinators to increase the flow of steel scrap to meet the demands of the scrap hungry steel furnaces, the steel industry will continue to benefit from the environmental benefits of recycling steel scrap.”

Japanese crude steel output in FY to reach 120 million tonnes

JMB reported that Japan’s raw steel output could reach 120 million tonnes for fiscal year 2007-08.

The report said that the output increases with high domestic demand for manufacturers and record level export at more than 36 million tonnes annually.

It further added the output would keep more than 110 million tonnes for 5 years in a row while the output reached 110 million tonnes only 4 times before that.

Chinese billet and slab export during January to June 2007

Despite 10% export tax on billet and slab export, China has exported 0.752 million tonnes in the month of June 2007 and the total export during January to June 2007 has been 4.369 million tonnes.

During the first half of 2006, South Korea with 0.953 million tonnes accounted for 21.8% share and along with Vietnam, Taiwan, Thailand and Indonesia accounted for almost 75% of the total export volumes.

China billet and slab export to different countries during January to June 2007

In tonnes

Billets and slabs referred to in the above table includes
1. Common carbon billets and slabs
2. High carbon billets and slabs
3. Stainless steel billets and slabs
4. Alloyed forging billets and slabs
5. Other alloyed billets and slabs

(Sourced from MySteel.net)

EC guidance classifies BF slag in UK as byproduct

Waste & Resources Action Program announced that a decision by the UK Environment Agency under the guidance of the European Commission to reclassify steel blast furnace slag as a byproduct rather than waste, will permit the re use of the approximate 3 million tonnes of slag produced in the UK each year.

The reclassification came as a result of a consultation exercise with industry undertaken by the Waste Protocols Project a JV between the Environment Agency and WRAP. Recently issued guidance from the European Commission on the distinction between byproducts and wastes was considered and helped shape the outcome.

Mr Richard Swannell joint project executive at Waste & Resources Action Program said that "Blast furnace slag is a first rate quality resource for the production of aggregates for a range of high value applications reducing the demand for primary aggregates.” He added that as ground granulated BFS it has even greater benefits as a cement replacement improving concrete quality and reducing concrete's carbon footprint.

Mr Martin Brocklehurst head of environmental protection external program at the Environment Agency said "Considering all the information available about air cooled and ground granulated BFS produced in the UK have been able to conclude that this material can be classified as a byproduct and not a waste. He added that this is good news for the industry, which contributed greatly to the technical report that helped inform this decision."

Previously, some BF slag had been controlled under waste legislation, resulting in its unnecessary disposal in landfill sites.

Demand for BF slag is high in UK and it currently outstrips supply. The statement also said that approximately 75% of UK BFS production is converted into ground granulated BF slag and the remainder into air cooled BF slag. Virtually all granulated BF slag produced is for sale to the UK concrete market. Air cooled BFS is however, commonly crushed and screened for UK aggregate sales.

Mechel eying ferroalloy assets in Russia

FIS recently reported that Mechel is planning to purchase ferroalloy assets in Russia and one of likely candidates for the purchase is Bratsk Ferroalloy Plant owned by IST Group.

At the same time analysts believe that Mechel may also get interested in other Russian ferroalloy assets like Klyuchevsky Ferroalloy Plant, a member of RosSpetsSplav and a major Russian producer of metallic chromium. Besides Mechel may also be looking closely at Kuznetsk Ferroalloys Company.

Miranda and Ihlosi forms JV to explore Sesikhona Kliprand deposits

South Africa exploration company Miranda Mineral Holdings announced that it had entered into a JV agreement with junior firm Ihlosi Project Mining to do more exploration and mining at its Sesikhona Kliprand coal and anthracite deposit in KwaZulu Natal. Miranda Mineral said that analysis of samples and existing borehole data showed an estimated deposit of some 22 million tonnes of high grade anthracite, of which 10 million tonnes are conducive to opencast mining.

Miranda in a note to the JSE said that Ihlosi would pay Sesikhona Kliprand an initial fee of ZAR 6 million of which ZAR 1 million was payable within 7 days from signature of the agreement and the remainder in ZAR 500,000 a month installments for the next 10 months.

Ihlosi would conduct a program of confirmatory drilling of existing drill holes and bulk sampling. Upon completion of satisfactory prospecting activities and approval by the Department of Minerals and Energy, Sesikhona Kliprand would then immediately apply to the department for the conversion of the prospecting permit to a mining license.

Once a mining license had been obtained, Ihlosi would have the exclusive right to mine the project and once production started it would pay Sesikhona Kliprand a participation fee of ZAR 50 per tonnes of coal mined over the life of mine, increasing yearly in line with the consumer price index.

Miranda holds an 88% direct and indirect stake in Sesikhona Kliprand with the local community holding the remaining 12%.

Urals Steel triples earnings in H1

Interfax reported that Urals Steel, a steel unit of the Gazmetall Group, increased net profit by 210%YoY to RUB 3.115 billion in January to June 2007.

Urals Steel revenue grew by 25.6% to RUB 22.637 billion while costs increased by 18.3% to RUB 17.238 billion. Its gross profit jumped by 56.6% to RUB 5.399 billion operating profit doubled to RUB 4.126 billion and pretax profit tripled to RUB 4.153 billion.

Urals Steel payables dropped from RUB 3.429 billion to RUB 2.815 billion in January to June while receivables rose from RUB 4.265 billion from RUB 5.219 billion.

Henan finds new coal deposits of 600 million tonnes

It's learned from Henan Province Geology and Mineral Bureau that a big coalfield was lately found in Jiaozuo with coal reserves forecast to top 600 million tonnes.

Expert said that the new field is located to the east of Jiaozuo coalfield, in south part of Taihangshan with prospecting areas stretching 55.23 square kilometer. It is found reserves held by coal bed above 1500 meters depth is 390 million tonnes under that, 240 million tonnes. This coalfield is to be mined for at least 88 years with coefficient of recovery of 70%. It has proven two layers of quality thermal coal and anthracite.

Expert added that the discovery is a big contribution to Jiaozuo's coal mining industry as the old resources are being exhausted.

(Sourced fromMySteel.net)

Nippon Steel and JFE to setup multi crystal silicon facilities

Nikkei recently reported that Nippon Steel Corp and JFE Steel Corp each plan to build facilities for making multi crystal silicon for solar cells in view of increasing demand from cell makers.

Nippon’s new plant will be constructed at its Yahata steelworks in Fukuoka Prefecture at a cost of JPY 3 billion and begin producing the material in October 2007. It is aiming at annual output of 480 tonnes.

Honeywell introduces material tracking SW for mining

It is reported that Honeywell has released Material Tracking R100 as part of its Business FLEX manufacturing execution system applications. Material Tracking is a configurable software framework that enables mining, mineral processing and metals production companies to synchronize supply chains with financial processes resulting in improved productivity and reduced costs.

Material Tracking can be used in several industries including mining, blending and shipping, iron and steel making, ore processing and concentration, metals refining and chemical batch operations. The program allows tracking, tracing, storage and analysis of all supply chain data including material flow, quality, ore type and other information. It also provides site specific, near real time views of critical production information with intuitive displays that allow operators to execute and adjust production plans within the supply chain in order to ensure safety, efficiency and reliability.

The system also can serve as a link between production and financial operations. It also can transmit actual production totals and summary data to ERP systems. Additionally, the software receives laboratory data and automatically associates it with recorded inventories.

Material Tracking interfaces to plant historians and or control systems to track material movement data and movement event triggers. The solution manages stockpiles and blending, including simulation and movement reconciliation. It also provides graphical batch analysis functionality that includes full genealogy tracking.

Mr Ashish Gaikwad global business director of Advanced Solutions for Honeywell Process Solutions said that "Material Tracking can give manufacturers a better handle on their supply chains which leads to multiple benefits including better data analysis and the ability to match inventories with customer demands. He added that this integrated approach can help align the financial process with the supply chain and result in more efficient productivity on the plant floor."

ArcelorMittal Poland launches HSM at Krakow in Poland

It is reported that a new 2,100 mm hot sheet rolling mill was launched at the ArcelorMittal Poland steel mill in Krakow thus fulfilling one of its obligations stemming from an agreement signed with the Ministry of Treasury in October 2003 concerning the privatization of Polskie Huty Stali SA.

As per report in the Polskie Huty Stali privatization agreement, LNM Holdings undertook as a strategic investor to implement an investment program to the tune of over PLN 2.4 billion. The program whose aim was to broaden the offer and to introduce highly processed products provided for four main investment projects
1. The construction of a new hot strip rolling mill in Krakow
2. Building of a third steel slab caster in Dąbrowa Górnicza
3. Modernization of the wire rod mill in Sosnowiec
4. Construction of a color coating line in Świętochłowice.

DMI to set up wind tower unit at Tulsa in Oklahoma

It is reported that West Fargo North Dakota based wind tower manufacturer DMI Industries has formally acquired a building at Tiger Switch Road at Tulsa in Oklahoma for its new wind tower production plant, which is expected to be operational in early 2008.

The Tulsa plant will feature half a million square feet of production space. According to the company, DMI's annual tower production from the Tulsa plant and two existing facilities will support a total of more than 3,000 MW of installed wind project capacity, based on tower and turbine technologies and designs.

DMI said that it plans to employ about 450 people at the new plant and is currently seeking at least 200 employees to begin operations on opening day. It plans to hire the vast majority of employees locally, including welders, painters and steel plate rollers as well as general management, supervisory, human resources and administrative personnel. Tulsa employees will be trained on site and in the company's West Fargo and Fort Erie facilities.

Pilsen Steel bags USD 55.6 million contracts

OMZ has announced that its subsidiary Pilsen Steel, formed by the merger of former parts of Skoda Steel, SKODA Kovarny, Plzen sro and SKODA HUTE in April 2007, has concluded contracts with Russian and foreign customers valued at more than USD 55.6 million.

Pilsen Steel specializes in the production of forged blanks of 1 to 80 tons. It is a world leader in the production of forged shafts for wind powered electricity plants and the second biggest supplier of crankshafts for four stroke diesel engines. Pilsen Steel also manufactures rotors and propeller shafts. It also supplies to the global market casting products of up to 200 tonnes, including casting products for steam and gas turbines, engine units, housings for rolling mills and processing machines and also casting products for the shipbuilding industry.

Yanzhou Coal H1 profit up by 4.8% YoY

Yanzhou Coal Mining Company, a unit of China's 4th largest coal producer, said that its first half profit rose 4.8% after sales and prices increased. Yanzhou, based in the eastern province of Shandong in a statement to the Hong Kong stock exchange said that its net income in H1 of 2007 climbed to CNY 1.50 billion (USD 198 million) from CNY 1.43 billion in H1 of 2006 and sales increased by 13% YoY to CNY 6.70 billion.

Yanzhou said that ”The economic development of the People's Republic of China is maintained at a rapid rate which results in strong demand for coal by primary industries. It average sales price in the first half of 2007 increased by 12.9% YoY to 390.1 per tonne. The average domestic coal sales price rose by 20% YoY to CNY 395 per tonne. The average export price dropped by 20% YoY to CNY 336.15.

Yanzhou said China is changing from a net coal exporting country to an importer and this will increase domestic supply. Still, enhancements to China's railway system have failed to end bottlenecks that restrict coal supplies. Its cost of sales and railway transportation jumped 28% in the first half. It said that China is for the first time aware of the importance in energy saving and CO2 emission reduction which will accelerate the consolidation of the coal industry. This will enhance the competitive advantage of large scale coal companies.

The company forecast slightly tight' global supplies in the rest of 2007. It said “Global coal supplies will be slightly tight in the second half with prices of the fuel to rise amid constraints on shipments from Australia and increased imports by China and Japan.”

Angang complete a 7 meter tall coke oven project

It is reported that the construction of first JN70-2 large coking furnace with 7 meters tall batteries in China was completed on August 15th 2007. The furnace is located in coking plant of Bayuquan Project of An’gang.

The furnace was contracted and constructed by ACRE Coking & Refractory Engineering Consulting Corporation of MCC using indigenous technology.

As per report, 75 days after start up the coking furnace will have the first batch of production on November 15th 2007.

Japanese spot ferromolybdenum prices bottoming out - Report

Platts citing Japanese trade and consumer sources reported that Japanese spot ferromolybdenum prices might be bottoming out now after a month of trading amid soft sentiment.

The report cited a Japanese trader as saying that Japanese steel maker sourced 40 tonnes of ferromolybdenum at USD 72 per Kilogram CIF Japan from southern China, higher compared with USD 71 per Kilogram to 71.50 per Kilogram CIF Japan level of last week. Other traders said they have been offered USD 73 per Kilogram to 74 per Kilogram CIF Japan from Chinese producers. He said “This had a psychological effect I have been tempted to close a deal, because the prices may rise further tomorrow."

A second Japanese trader said he might advance forward with his plan to hold a tender if offers continued to rise at a fast pace in coming days. He said “There is a general atmosphere for higher prices people giving many different explanations for higher prices. So is this just a sentiment, or based on a real change in demand and supply I need to be discreet."

Japanese traders and consumers said Chinese sellers had attributed reduced availability of molybdenum concentrate due to flood damages in China, steel material demand picking up in the country, active European buyers pushing prices up, among others.

Maanshan H1 net profit up by 3.5% YoY

According to the Maanshan's interim report Maanshan Iron and Steel Co Ltd, the dual Shanghai and Hong Kong listed arm of Maanshan Iron and Steel Group, has reported a 3.5% YoY net profit rise for the January to June 2007 period to CNY 1.12 billion (USD 147.36 million).

LKAB appoints Mr Heyden as VP Market Division

Swedish mineral producer LKAB announced that Mr Johan Heyden has been appointed as VP Market Division of LKAB with placement at the group head office in Luleå. He would assume his new position on December 1st 2007 when Mr Bengt Hjärpe, who is currently VP Market Division, retires.

Mr Johan graduated with an MSc in mechanical engineering, specializing in material science and material engineering, from Luleå University of Technology in 1988. He was employed by LKAB 1996 and has worked, in among other positions, as Sales Manager for LKAB Nordic region. Since July 1st 2005, Mr Johan has been VP of LKAB Far East Pte Ltd in Singapore.

LKAB is an international high tech minerals group, one of the world’s leading producers of upgraded iron ore products for the steel industry and a growing supplier of industrial minerals products to other sectors. LKAB has subsidiaries and facilities for industrial minerals in Sweden, Finland, Greenland, the UK, Germany, the Netherlands, Greece, Turkey, Thailand, Hong Kong, China and the USA. LKAB’s chief assets are the magnetite ore of the Orefields of northern Sweden. Most of the iron ore products are sold to European steel mills. Other important markets are North Africa, the Middle East and Southeast Asia. Industrial minerals are sold mainly in Europe, but businesses are growing in Asia and the USA.

Huludao Zinc H1 net profit down by 42% YoY

Shenzhen listed Huludao Zinc Industry Co Ltd announced that its net profits during January to June 2007 fell to CNY 116.59 million (USD 15.37 million) down by 41.98% YoY.

According to an interim report released by Shenzhen, during January to June 2007 Shenzhen made CNY 110.56 (USD 14.58 million) in non operational revenue, generated through a local government income tax exemption and a debt asset swap. As the company did not encounter the same opportunities in the first half of this year net profit declined.

However, Huludao Zinc did manage to record an operating revenue of CNY 4.89 billion (USD 644.59 million) in the January to June 2007 period lifting by 72.74% YoY as compared to January to June 2006 on the back of an increase in both zinc product production and prices.

Baosteel heavy SBQ plates get RINA certification

Italy's Registro Italiano Navale Group RINA announced that China’s Baosteel Group's TMCP vessel plate product has been qualified as the excellent heavy plate levels internationally.

TMCP steel processing technology can control accurately the rolling process and the annealing process and is one of the most advanced heavy plates processing technology in the world. By using such technology, TMCP can produce heavy plate sources with lower cost and better quality also the users can weld the plate directly to increase its efficiency.

The TMCP vessel plate products that developed by Baosteel have already obtained several certifications from global shipping association. Baosteel has exported about 3,000 tonnes of TMCP plate in the past few years.

Hangang net profit during H1 up by 16.75% YoY

According to Hangang’s mid term report, it achieved net profit of CNY 501 million up by 16.75% YoY during January to June 2007. Its revenue from sheet division was CNY 7.928 billion with gross margin of 18.93% up by 4.24% YoY, from bar division CNY 1.805 billion with gross margin of 0.32% down by 12.75% YoY and from overseas market CNY 722 million up by 264.5% YoY.

Its production of crude steel was 3.033 million tonnes down by 2.48% YoY, finished steel was 2.801 million tonnes up by 6.5% YoY.

Hangang said that “Market competition became more furious due to aftereffect from national macro regulatory, pressure from environmental protection, coupled with changes of export rebate.”

Baosteel and Hangang also signed cooperation on May 10th 2007 to set up a JV Hangang Hanbao Company, which mainly deals with construction, operation and development of Hangang new area where a 4.6 million tonnes per year sheet production line will be built to produce short supplied high value added materials such as pipeline steel, auto sheet and home appliance.

US Steel to acquire Stelco

United States Steel Corporation and Stelco Inc announced that they have entered into a definitive agreement pursuant to which US Steel will acquire Stelco for CAD 38.5 in cash per share. Under the terms of the definitive agreement, US Steel will acquire all of the outstanding shares for an aggregate value of approximately USD 1.1 billion based on approximately 30 million fully diluted shares. The acquisition will be accomplished as a Plan of Arrangement under Canadian law. The acquisition is subject to review by US and Canadian regulatory authorities and other customary conditions and is expected to close before the end of 2007.

Shareholders owning more than 76% of Stelco's outstanding shares, including Tricap Management Limited, Sunrise Partners Limited Partnership, Appaloosa Management LP and Mr Rodney Mott CEO of Stelco have entered into agreements with US Steel irrevocably committing to support the transaction.

US Steel has also made commitments to the Province of Ontario with regard to Stelco's main pension plans and operations in the Province. US Steel plans to make significant capital expenditures at the Hamilton and Lake Erie facilities and to endow a Priority Chair in the Department of Materials Science and Engineering at McMaster University to facilitate the continuing development of steel making technology in Ontario.

US Steel expects the acquisition of Stelco to strengthen its position as a premier supplier of flat rolled steel products to the North American market. Stelco's Lake Erie Works is the most modern integrated steel plant in North America and the slabs produced at Stelco's Lake Erie and Hamilton Works will expand US Steel's semi finished steel supply chain capabilities to support finishing facilities for both flat rolled and tubular products. Stelco also owns several JV interests including iron ore operations in the United States and Canada, and a 60% interest in Z-Line. After the acquisition, US Steel will have annual raw steel capability of approximately 33 million net tons.

Mr John P Surma chairman & CEO of US Steel said "Our acquisition of Stelco is another example of how we are building value for our stakeholders. From the increased utilization of our Minnesota Ore Operations through the conversion of slabs and hot bands produced at Stelco by our other finishing facilities, this transaction optimizes our operations and allows us to better serve our customers. With major facilities located on both sides of the Great Lakes, this acquisition will significantly increase our ability to respond to market demands and our customers' needs.”

Mr Rodney Mott president & CEO of Stelco said "The fit with US Steel is excellent. This is an outstanding deal for Stelco's owners, employees, customers, suppliers and communities. Our goal through the Stelco restructuring process was to re establish Stelco as a competitive steel company and position it to be part of a larger, stronger company that can provide additional security for our employees and their communities. Our transaction with US Steel represents the successful conclusion of an exhaustive review of opportunities for Stelco. US Steel brings the financial strength, operating experience and advanced research and technology capability that are critical for the continued success of the Stelco facilities."

JP Morgan Securities Inc acted as financial adviser to US Steel and CIBC World Markets and UBS were financial advisers to Stelco. Morgan Lewis & Bockius and Osler Hoskin & Harcourt served as counsel to US Steel and McCarthy Tetrault served as counsel to Stelco.