Inter ministerial group on steel to review progress of projects

PTI reported that a government panel inter ministerial group set up to facilitate investments in the booming steel sector will meet on October 18th 2007 to discuss projects proposed by global giants like ArcelorMittal and POSCO among other issues. The meeting was earlier scheduled for October 8th 2007, but has been postponed as some of the members were traveling abroad.

The report cited a senior steel ministry official as saying that "The inter ministerial group will now meet on October 18th 2007 as senior officials of the steel ministry and steel majors are currently overseas.”

The official added that "We envisage an investment of INR 276,880 crore in the sector by 2011-12. The inter ministerial group will deliberate on ways and means to fructify these projects in its meeting."

As per report, Mr RS Pandey union steel secretary has gone to Berlin to attend a conference. Mr SK Roongta chairman of SAIL and Mr PK Bishnoi chairman of RINL have also gone there to attend the conference organized by International Iron and Steel Institute.

CIL chairman calls for making coal reserve estimates realistic

Mr PS Bhattacharya chairman of Coal India Limited recently said that the coal reserve estimates of India need to be pruned down and made realistic.

Mr Bhattacharya said that “Taking into account the mineable reserves, India could run out of coal in 40 to 45 years.”

According to current estimates, India has coal reserves of 222 billion tonnes, which include proven, indicated and inferred reserves. However, a significant part of this coal is however not mineable as it is located in inaccessible or sensitive areas like forests, making the reserve estimate somewhat illusory.

JSW Energy close to buying coal mines in Australia, Indonesia

ET recently reported that JSW Energy is close to acquiring coalmines in Indonesia and Australia as it has finished due diligence of these mines. As per report, the total cost of acquisitions is expected to be over USD 500 million.

The report cited Mr NK Jain vice chairman of JSW Energy as saying that “Our coal based power projects will be ready by 2008-09. Before completing these projects, we have to ensure coal linkages through mine acquisitions. We have shortlisted a few companies in Indonesia, Australia and Mozambique and talks are progressing.”

As per report, JSW energy would requires 10 million tonne to 15 million tonne of thermal coal every year to feed its power plants and is looking aggressively to secure the supplies. As per report, it has already acquired a few small mines in Indonesia and Mozambique.

JSW Energy plans to set up power projects having a cumulative capacity of 4,000 MW at an investment of around INR 12,000 crore. It already operates a 260 MW power plant in Vijaynagar from which it sells 60 MW to group company JSW Steel and 200 MW to other utilities. A 600 MW imported coal based project is coming up at Vijaynagar in Karnataka. Another 1,200 MW coal fired project is under construction at Ratnagiri in Maharashtra. JSW Energy also operates and maintains JSW Steel’s captive 230 MW plant. It is also setting up a 1,000 MW lignite based power plant in Rajasthan and a 260 MW hydel project in Himachal Pradesh.

Nippon Steel may buy stake in Gangotri Iron - Report

It is reported that Nippon Steel may pick up a 10% stake in Gangotri Iron & Steel Co Ltd through a preferential issue at INR 80 to INR 85 per share. As per reports, Nippon Steel's subsidiary will acquire the stake as both the parties are in the final stages of negotiations and the announcement is expected in the current quarter.

The report cited Mr Sanjiv Kumar Chowdhary MD of Gangotri Iron & Steel as saying that "I do not want to comment anything on the stake dilution to Nippon Steel at this stage. If anything happens, the company will inform the exchanges."

Steel industry experts said that a stake dilution would help Gangotri Iron to work on its infrastructure development plans.

Gangotri Iron & Steel has acquired 14 acres of land to set up a fully integrated steel plant with a capital outlay of INR 60 crore in Bihar. The plant will manufacture 120,000 tonnes TMT bars per annum through Thermax process and wire rods. The plant is expected to commence its trial production by December 2007.

AP CM announces freezing of power tariff for next 5 years

It is reported that Andhra Pradesh government is planning not to increase power tariff for the next 5 years.

Dr YS Rajasekhara Reddy chief minister of Andhra Pradesh recently said that “APGenco and Transco provides a model to run public sector enterprises on profit path and an action plan should be prepared to sustain no further hike in power tariff without losing profitability.”

Dr Reddy directed that “There has been no power tariff hike in the state for last 3 years. This should be continued for next 5 years and Andhra Pradesh will set a record for not hiking power tariff in 8 years in a row.”

CCCML update on its coal mining venture in Chhattisgarh

It is reported that Raipur based Chhattisgarh Captive Coal Mining Limited is rapidly progressing work on the coal blocks allocated to it by the central government.

As per a release, geological report has been purchased from Central Mine Planning & Design Institute Limited for INR 4 crores and bank guarantee of INR 41.75 crores has been deposited with Ministry of Coal as per terms of allocation letter. A mining plan has been prepared and submitted to government for approval and formal approval is expected shortly, which is a pre requisite for undertaking mining operations. The release added that applications for grant of mining lease and forest clearance are under process of approval. It added that work of preparation of Environment Management Plan has been initiated with ministry of environment and forests.

The mine will produce 5 million tones of coal per annum.

Chhattisgarh Captive Coal Mining Ltd Raipur is a JV of Godavari Power & Ispat Limited, Ind Synergy Limited, Shri Nakoda Ispat Ltd, Vandana Global Limited, and Shree Bajrang Power & Ispat Limited for development of coal blocks for sourcing coal for their captive use in sponge iron and power plants. It has been allocated Nakia I and II coal blocks 80 Kilometer north east of Korba in Chhattisgarh in 2006, which is reported to have 243 million tones of mineable reserves. The allocation was modified in May 2007 to suit the requirement of JV partners as under

In million tonnes

Rathi Bars to raise INR 25 crore through IPO

It is reported that rebar manufacturer Rathi Bars Limited is looking at raising INR 25 crore through an initial public officer to fund expansion plans.

The issue will open on October 18th 2007 and close on October 23rd 2007. The promoters are looking at diluting around 44% of the stake in the company.

Mr KK Rathi MD of Rathi Bars Limited said that “We propose to tap the capital market with 7.143 million shares to raise around INR 25 crore to fund the expansion program of our manufacturing facility located here. The shares with a face value of INR 10 would be issued at INR 35 each.”

Mr Anurag Rathi director of Rathi Bars Limited said that “Its current production unit has capability for manufacturing 70,000 tonnes and it has a capacity utilization of around 90% to 95%. We plan to raise it to 0.1 million tonnes per annum. The public issue would fund the bulk of the expansion and the remaining capital required will be raised from debt and internal accruals.”

Rathi Bars Limited had a turnover of INR 194 crore during 2006-07 with a profit after tax of INR 6.08 crore. It has been witnessing a growth rate of 15% to 20% in the last couple of years. It has close to 900 dealers across 6 states in Delhi, Punjab, Haryana, Rajasthan, Himachal Pradesh and Uttar Pradesh.

2 killed in CIL CCL coalmine in Jharkhand

It is reported that bodies of 2 miners, who were trapped in a Jharkhand mine after it caved in, have been recovered. Officials said that rescue operations are underway, as 4 to 5 people are still believed to be trapped.

The incident occurred in the early hours of Sunday morning when a portion of the mine capsized, as the villagers were digging coal from the Karma Project of Coal India Limited’s subsidiary Central Coalfields Limited in Jharkhand's Ramgarh district.

Villagers alleged that the government officials reached very late at the accident site. Local people said that "The incident happened between 6 AM and 6.45 AM. The government officials have come only around 10.30 AM."

The report cited a police official as saying that CCL was operating the mine illegally and action would be taken against it. He said "Police have always taken action against illegal mines, but this falls under the CCL. The accident is CCL's carelessness and action will be taken against them."

ICCL restructuring challenged in the court

SNS recently reported that the financial restructuring of Indian Charge Chrome Limited, which subsequently merged with Indian Metals and Ferro Alloys Limited, is being challenged in the court on the grounds of irregularities and opposition parties are demanding a CBI probe.

NCP leaders told reporters that they had raised the issue a long time ago. They added that someone has moved the court it only strengthens our stand and it is high time the CBI should investigate because it involves the funds of several banks.

However the report cited Indian Metals and Ferro Alloys Limited as clarifying that debt restructuring does not involve the state or the central government in any manner. It said that “After Indian Charge Chrome Limited was granted mining lease in 1999, it was regular in repayments and had subsequently entered into a debt restructuring scheme in accordance with RBI guidelines.”

Indian Metals and Ferro Alloys Limited claimed to maintain highest standards of corporate governance and transparency and said it will respond to the PIL in court with all the facts.

Kakinada Ports considering 1 time settlement of revenues to AP

It is reported that Kakinada Sea Ports Limited plans to go in for a one time settlement of its revenue share with the state government as against the existing yearly installment scheme.

The deepwater port was constructed by the Andhra Pradesh government with three berths at a cost of INR 293 crore and was handed over to Kakinada Sea Ports Limited a private consortium, on maintenance, operate and transfer basis for a period of 20 years.

According to the present agreement, the Kakinada Sea Ports Limited has to pay INR 525 crore for 20 years on the basis of increasing revenue share every year to the government. So far, the company has paid INR 125 crore in eight installments.

Kakinada Sea Ports Limited is now planning to pay the entire amount in lump sum as it feels it would benefit the company. A Kakinada Sea Ports Limited official said that “It has to pay INR 400 crore in remaining 11 installments including the interest and if it goes for OTS, it need not pay the interest on the remaining installments, which comes to around INR 200 crore”

GE Shipping takes delivery of medium range product tanker

Great Eastern Shipping Company Limited recently announced that it took delivery of its new building medium range product tanker called Jag Prerana.

The 47,400 DWT double hull medium range product tanker was built at STX Shipping Co Ltd in Korea.

With this, GE Shipping's fleet of 48 vessels comprises 36 tankers with 14 crude carriers, 20 product tankers and 2 LPG carriers and 12 dry bulk carriers with an average age of 11.3 years, aggregating 3.29 million DWT. GE Shipping's current new building order book comprises four LR1 product tankers aggregating 0.30 million DWT.

Samudera Shipping to purchase 2 container vessels

Samudera Shipping Line Limited announced that it has entered into an agreement to purchase 2 container vessels for a total of USD 83 million.

The vessels, to be built by Guangzhou Wenchong in south China, will each have a capacity of 1,740 TEUs and be delivered in the fourth quarter of 2008.

Mr Dhrubajyoti Das executive director of Samudera Shipping Line said that "The addition of the 2 new vessels will give us added flexibility in fleet deployment. With charter hire prices continuing their up trend, owning these vessels will help provide stability in operating costs."

Samudera Shipping currently operates 22 vessels on a combination of short and long term lease. It intends to deploy the vessels in one of its major trades in line with its strategy of improving frequency.

8 Vishwakarma awards for BHEL employees

Bharat Heavy Electrical Limited announced that its 8 employees have bagged Vishwakarma National Awards for 2006 for innovative suggestions leading to cost reduction and high productivity.

The awards have been shared by the 8 employees from BHEL's Haridwar, Bhopal and Trichy units. This has taken the total number of Vishwakarma awards won by the company's employees to 100.

Also, 3 national safety awards have been received by BHEL's electronics & electro porcelains divisions of Bangalore for achieving longest accident free period.

Tamil Nadu maoist opposing Setu project

It is reported that Mr Sundaramurthy a Maoist leader in Tamil Nadu has raised his voice against the Sethusamudram Ship Canal Project, saying it will affect the livelihood of fishermen.

He announced that "We will oppose the Setu project as it will affect livelihood of 1.5 million fishermen."

Mr Sundaramurthy was arrested at Marugamalai in Theni district on July 9th 2007 and the court has extended the remand till October 22nd 2007.

EU steel users reject calls to curb steel imports from China

It is reported that in response to European steel industry executives move for the imposition of antidumping duties against China's fast growing imports, European steel consumers have opposed any reductions in imports of Chinese steel saying that they are already facing shortages of steel.

Mr Adrian Harris secretary general of the European engineering association Orgalime said that "Our companies are therefore finding it ever more difficult to buy steel locally in the quantities and qualities they need at competitive conditions. If increasing quantities of certain steel grades are finding their way into the European market, it is clear this is because of demand in the EU is on the rise, while output is not able to keep up and stocks of steel in the EU are limited."

He said that "It just does not make sense to hit the competitiveness of the EU's metalworking and mechanical engineering SMEs, which provides over 7 million jobs throughout the EU to protect the interests of an industry, which, through its increasingly global development, now only provides 250,000 jobs in a few European countries.”

Mr Harris said that “For us matters are simple. Our companies must have access to the supplies of steel they need at competitive market conditions."

Orgalime represents national groups whose members include big steel consumers such as Siemens AG and ABB Ltd.

Zinc to see deficit in 2007 and surplus in 2008

It is reported that the world market for refined zinc metal is expected to show a supply deficit of 47,000 tonnes in 2007 but in 2008 increased supply is expected to result in a surplus of about 250,000 tonnes.

The International Lead & Zinc Study Group recently forecast anticipated increases in global demand for refined zinc metal of 3% to 11.38 million tonnes in 2007 and 5.1% to 11.96 million tonnes in 2008.

It will be due principally to expected further robust growth in China of 8.8% in 2007 and 12.1% in 2008. It said elsewhere in Asia it is anticipated that Indian demand will continue to rise steadily, but in a number of other countries, in particular in South East Asia, growth is predicted to be limited. In the US, a decline of 1.9% is predicted in 2007 with demand remaining stable in 2008, while European usage is forecast to rise by 2.5% in 2007 and 1.4% in 2008, primarily as a consequence of increases in Belgium and Italy.

The International Lead & Zinc Study Group said Global refined zinc metal production is expected to increase by 5.9% to 11.32 million tonnes in 2007 and by 7.8% to 12.2 million tonnes in 2008.

It said the largest rises will be in China and India, where Hindustan Zinc's second 170,000 million tonnes per year capacity plant at Chanderiya is due to open at the end of 2007 adding that an increase in Europe would be mainly influenced by rises in Belgium, Finland, France, Poland, the Russian Federation and Spain. Production is also expected to be higher in Australia, Kazakhstan, the Republic of Korea, Mexico, Thailand and the US. Recently opened San Cristobal mine will substantially boost production in Bolivia, while Australian and Canadian output is also predicted to rise sharply, influenced by the commissioning of a number of mines in both 2007 and 2008. It said anticipated rises in Peru would be principally the result of increases at the Antamina mine and the opening of Minera Milpo's Cerro Lindo operation. Zinc mine production is also forecast to rise in a number of other countries including China, Brazil, India, Ireland, Kazakhstan, Mexico, Portugal and the US.

Upbeat forecast for Chinese steel market outlook in October

It is reported that China's steel market has gone through downward correction in September 2007. In particular, prices of certain steel products like HRC have tumbled due to overly price rally in previous days. Moreover, the news of dwindling steel export in August has also weighed on the market sentiment. According to Mysteel analysts nevertheless, healthy economic outlook, strong overseas demand and escalating input cost are set to prop up steel prices in October 2007.

The market fundamentals remain quite optimistic both at home and abroad. China's domestic economy sustains hectic growth as its fixed assets investment keeps growing at 26.7% in January to August 2007. Real estate and steel shipment to other countries appears to accelerate at a desirable pace.

On the export front, EU, Japan and a host of emerging economies have shown notable demand growth for steel products which have supported global steel prices to held steady or inch upward recently. The price spread between China's domestic market and overseas market has given great incentive for the exporters. For example, HRC price stays at USD 690 per tonnes to USD 700 per tonnes in EU market as opposed to USD 580 per tonnes FOB China.

China's monthly steel shipment falls back to 5.38 million tonnes in August 2007. Of this, export of commercial HRC and medium plate maintains at a high level of 900,000 tons and 760,000 tons respectively. By contrary, CRC shipment hits a new record of 240,000 tons, almost coming close to the import tonnage. However, construction steel export has been hit hard by the export tax levy. The statistics show that rebar and wire rod export both more than halved in August. Mysteel analysts believe China's flat products export would remain competitive in the global market in days to come.

Now the market participants are concerned that the authority may further rise up the export tax on steel products in near future. However, Mysteel analysts predict that such curbing policy is unlikely to be released in the short term.

The analysts fear that slowdown in raw material supply and escalating prices would check the utilization of steel capacity in the future. China's iron ore import slips 10.7%YoY to 29.29 million tonnes in August 2007, the fourth time below 30 million tonnes so far this year. China's iron ore import volume has only expanded 14.5% in January to August 2007 with the growth rate dips 4% from 2006. Meanwhile, domestic iron ore output also declines to 62 million tons in August 2007 down 2.1% from the same time of 2006.

Limited availability of raw materials like iron ore would restrict the growth of steel output in October, forecast by Mysteel analysts. They are upbeat about domestic steel market next month on back of robust demand and steep input costs.

(Sourced from MySteel.net)

US SSINA releases 6 months market data for special steel

US based Specialty Steel Industry of North America has released statistical data on imports, US consumption and import penetration for YTD June 2007 as compared to January to June 2006 for

Imports of total specialty steel comprising stainless steel, alloy tool steel and electrical steel in January to June 2007 was 524,773 tons up by 13% YoY, US consumption was 1,473,690 tons down by 4% YoY and import penetration was 36%, a 6% point increase.

Stainless Steel
Imports of total stainless steel during January to June 2007 was 412,463 tons up by 8% YoY, US consumption was 1,202,652 tons down by 6% YoY and import penetration was 34% a 4% point increase.

Alloy tool steel
Imports of alloy tool steel during January to June 2007 was 52,275 tons reflecting no change as compared to January to June 2006 and US consumption & import penetration are not calculable.

Electrical steel
Imports of Electrical steel during January to June 2007 was 60,035 tons up by 87% YoY, US consumption was 227,930 tons up by 2% YoY and import penetration was 26%, a 12% point increase.

SSINA is a Washington DC based trade association representing virtually all continental specialty metals producers. Specialty metals are high technology, high value stainless and other specialty alloy products. Its member companies are AK Steel Corporation, ATI Allegheny Ludlum Corporation, ATI Allvac, Carpenter Technology Corporation, Crucible Specialty Metals, Electralloy, Haynes International Inc, ThyssenKrupp Mexinox SA de CV, North American Stainless, Outokumpu Stainless Inc, Precision Rolled Products Inc, Latrobe Specialty Steel Company, Universal Stainless and Alloy Products and Valbruna Slater Stainless Inc.

POSCO to hike SBQ plate price by 10%

Yonhap reported that South Korean steel maker POSCO Co would increase its price of ship building quality plates by 10% later this month as costs of raw materials rise.

POSCO Co in a statement said that starting October 25th 2007, it would hike the price of steel plates to KRW 665,000 (USD 727) per tonne from KRW 605,000.

Klöckner & Co Q3 EBITDA down due to SS price declines

On the basis of its provisional figures, Klöckner & Co AG announced that they improved YoY sales by roughly 15% to EUR 4.75 billion in January to September of the financial year 2007.

The release said that “However, due to the unsatisfactory development of certain steel prices in the third quarter, especially for stainless steel, it will post an EBITDA some 10% under the figure of the previous year of EUR 395 million in the 2007 financial year, thus under the previous forecast.”

Klöckner said that “While the volumes in Europe and North America remained satisfactory, it experienced increasing pressure on the gross margins in the distribution of steel products during the third quarter. It was particularly prices for stainless steel, which developed negatively, the result of a dramatic fall in the nickel price over the last few months. This resulted in a major negative impact on gross margins for stainless steel and a write down on inventories as of September 30th 2007.”

Dr Thomas Ludwig CEO of Klöckner & Co AG said that "Even if the development of steel and in particular the stainless steel prices in the third quarter mean that we will not achieve our original target for the current year, we will post the second best result in the history of Klöckner & Co. The profitable growth track remains intact.”

Klöckner & Co is one of the largest independent producer and distributor of steel and metal products in the European and North American markets combined. The core business of the Klöckner & Co Group is the storage and distribution of steel and non ferrous metals. About 200,000 active customers are supplied through approximately 250 distribution locations in 15 countries in Europe and North America.

Asian thermal coal prices cross AUD 71 mark on firm demand

Reuters reported that benchmark Australian spot thermal coal prices rose by 2% to more than AUD 71 a tonne recently finding support through robust demand in Asia as utilities aim to lift stockpiles before winter.

As per report Japanese and Taiwanese utilities, affected by Newcastle port's latest 2.2 million tonnes cut in export quota, have been forced to seek spot cargoes in the market to make up for the supply shortfall in the fourth quarter.

A source from a major Australian producer said "And we all know there is not a lot of spare tonnage lying around in Indonesia or anywhere else, so prices can only head north."

However the recent lift in Australian coal prices, which have hovered at about AUD 70 a tonne, will mostly benefit traders and Indonesian and Chinese sellers because Australian producers have either fully contracted their 2007 supplies or were seeing their supplies strapped at home due to infrastructure constraints.

Nickel prices likely to stabilize due to renewed buying

It is reported that nickel prices have bottomed and are likely to stabilize as SS makers have started buying to build their inventories.

Credit Suisse said that "Nickel prices appear to be bottoming out as stainless mills begin to slowly restock and this could push LME prices significantly higher. Notes nickel supply growth is likely to be 4.6% in '07 and 5.3% in '08 in an industry where nickel demand can swing from 0% to 10% depending on the restocking and destocking cycles of the stainless producers."

Mitsui Bussan Commodities Limited said "Consolidation of the mining industry into financially strong industrial groups is providing the exploration and development capital to pursue major resources, but the scarcity of world class deposits in copper and nickel has been an impediment to a ramp up in metal supply."

Mr Michael Khosrowpou analyst for Triland said "Nickel stocks held by exchanges, industry to continue to rise in short term which should soften prices. LME nickel retains recently gains after LME lifts nickel lending guidance imposed June 6th 2007 to stop market becoming disorderly; move past USD 33,000 per ton likely to trigger upside stops, r; adds upside advances past USD 36,000 appear capped for now as result of current high underlying stock figures."

Chinese nickel project in Myanmar delayed

Reuter reported that the building of a USD 600 million nickel project in Myanmar has been delayed because of the government's request for a larger stake and political unrest in the country.

An official at the Chinese partner said that state owned China Nonferrous Metal Mining Co Ltd had planned to start construction of the project, of which it would own 75% with an investment of USD 600 million, in September and begin production in 2009 and Myanmar's government had planned to take the remainder.

The official said that “It is not only about the political situation. It has made some adjustments in its state mining policy. His firm was still in talks with Myanmar's government and hopes to reach an agreement. Prolonged talks might result in a smaller stake for the Chinese firm but with a similar investment. They want more shares. Ours may be smaller than the original plan."

The official expected talks to end soon and construction of the nickel project to begin before the end of this year. The project is designed to produce 1 million tonnes of ore, to be used to make 20,000 tonnes of nickel in ferronickel.

Under Beijing's instructions, China Nonferrous started work on the nickel project in 2004.

Delong Holdings confirms break up with Cape Lambert

Interfax China reported that Delong Holdings Ltd, a privately run steel maker and trader in China, announced on October 5th 2007, that the company has not been able to come to any agreement on a proposed acquisition of a stake in a subsidiary project of Cape Lambert Iron Ore Ltd.

China Nickel to spend USD 800 million in Indonesia - Report

Reuter reported that China Nickel Resources Holdings plans to invest at least CNY 6 billion (USD 800 million) in the next five years to expand its stainless steel business, mainly in Indonesia.

The South China Morning Post quoted Mr Dong Shutong chairman as saying that China Nickel planned to raise its annual stainless steel capacity to 4 million tonnes by 2011 from around 500,000 tonnes at the end of this year.

Mr Dong told the newspaper that the company would invest a further CNY 4 billion for the second phase of the Kalimantan project to raise its capacity by 2 million tonnes. The plant, expected to start production next year or early 2009, was located next to an iron nickel mine in southern Kalimantan. Mr Dong said "Indonesia produced 3 million tonnes of steel last year, meeting only half of its demand. We have a big market here with very low production cost and high margin.

He added that the company also planned to invest CNY 1 billion to raise its capacity at its stainless steel plant in Henan to 1 million tonnes from 500,0000 tonnes. The plan is subject to government approval.”

1 killed and 4 missing in Fujian coal mine flood in China

Fujian media reported that at least one worker was killed and four others remained missing in a flooded colliery in east China's Fujian Province.

According to the Fujian’s provincial coal production watchdog, mountain torrents flushed the Chankeng coal mine of Yongding County in Fujian's far most western area that has not been affected by tropical storm Krosa, at about 11Am on Sunday trapping two electricians working underground.

It added that three workers who entered the shaft to rescue them also failed to get out of the flooded pit. Rescuers retrieved the body of one of the trapped people on Tuesday and is still searching for the four missing.

Krosa churned its way to the East China Sea on Monday after pounding China's southeast coast for more than 26 hours. It made landfall in the bordering area between Zhejiang and Fujian provinces on Sunday afternoon as a typhoon and quickly weakened to a tropical storm without causing deaths on the Chinese mainland.

Terra Nostra announces year end results: Record Revenue of $284.8 Million

Terra Nostra Resources Corporation, a majority owner of two JV in the copper and stainless steel industries in China has announced financial results and highlights for the fiscal year ended May 31st 2007.

The highlights are
1. Record revenue of USD 284.8 million
2. Operating profits of USD 1.8 million as compared to an operating loss of USD 13.5 million for fiscal 2006
3. Pre selling production to meet strong market demand
4. Ramping up of stainless steel production facilities
5. Inauguration of 150,000 tonnes stainless steel rolling mill.

The release attributed the increase in revenue to increased sales in the stainless steel JV and completion of the acquisition of the copper joint venture.

Mr Sun Liu James Po CEO of Terra Nostra said that "At present, strong market conditions for our products exist in China. Demand for stainless steel and copper remains high, driven by continued economic growth and development in China. This market situation has allowed Terra Nostra to pre sell certain production at premium contracted prices," stated "We expect these strong market conditions to remain for the foreseeable future while the Company continues to ramp up production at current facilities to full capacity to meet market demands."

Terra Nostra is one of the leading copper producers in China through its 51% interest in Shandong Terra Nostra Jinpeng Metallurgical Co., Ltd, which has an existing and under construction total production capacity of 170,000 tonnes of electrolytic copper, 20,000 tonnes of low oxygen copper, and value added copper rod and wire facilities. Terra Nostra is also emerging as a leading stainless steel producer in China through its 51% interest in Shandong Quanxin Stainless Steel Co Ltd, a modern stainless steel production facility with a 230,000 tonnes capacity casting mill and a 150,000 tonnes rolling mill.

Aurox Balla Balla iron ore project to cost AUD 603 million

Aurox Resources Ltd has estimated capital costs of AUD 603 million for its wholly owned Balla Balla iron ore project in Western Australia's Pilbara region.

Aurox said that of this, about AUD 158 million will be used to construct a slurry pipeline to transport concentrate between the mine and a new multi user export terminal at Port Hedland.

Aurox has completed its bankable feasibility study for the annual production and transport of 6 million tonnes of magnetite concentrate from the project, which also contains vanadium and titanium. The project is expected to generate annual revenues of AUD 418 million and earnings before interest tax depreciation and amortization of AUD 216 million.

Mr Charles Schaus MD of Aurox said that "Commissioning could start at the end of 2009 or early 2010. We are looking to raise project finance, about half through equity and the other half through the banks."

Mr LN Mittal conferred with Eisenhower Award

It is reported that Mr LN Mittal has been chosen for the 2007 Dwight D Eisenhower Global Leadership Award recently by a leading New York based Business Council for International Understanding. The award will be presented at Business Council for International Understanding's Annual Opera Gala at the Metropolitan Opera House at Lincoln Center in New York City, tentatively scheduled for Fall 2007.

Mr Peter Tichansky president & CEO of BCIU said "Mr LN Mittal has transformed the fragmented steel industry, turning it once again into a global force for good in communities worldwide."

Mr LN Mittal president & CEO of ArcelorMittal said that "Receiving the Dwight D Eisenhower Global Leadership Award is an honor that I accept on behalf of the individuals representing 45 nationalities who represent the fabric of Mittal Steel Company."

Business Council for International Understanding is a non profit making US business association dedicated to forging relationships and promoting dialogue between business and government communities across the globe. Since its inception in 2003, the Dwight D Eisenhower Global Leadership Award has been given to business executives who exemplify the definition of an international business leader by exhibiting outstanding contributions to global commerce.

Voestalpine may issue hybrid bond of EUR 1 billion

Thomson Financial reported that Austrian steel producer voestalpine AG is very likely to issue a hybrid bond of up to EUR 1 billion to help partly finance its acquisition of a 79.2% stake in Bowler Uddeholm AG.

Mr Gerhard Kuerner a spokesman of voestalpine told the Austrian press agency APA although it is very likely, the formal go ahead for the issue has not yet been extended.

APA citied Mr Kuerner as saying that Voestalpine's final decision on whether to go forward with the bond issue will depend on feedback from the road show the company will launch on October 10th 2007.

Earlier an the start of October, voestalpine announced that it had mandated Dresdner Kleinwort, Erste Bank and UBS to serve as joint book runners for the possible benchmark hybrid bond issue.

ISRI challenges SRI conclusions on steel recycling figures

Mr Robin Wiener president of the Institute of Scrap Recycling Industries in Washington DC, recently challenged conclusions in a Steel Recycling Institute press release that announced the steel recycling rate decreased in 2006.

Mr Wiener said that steel recycling increased by about 7% in 2006 in terms of volume and the recycling rate citied by the Steel Recycling Institute reflected the strength of the steel marketplace because economic growth stipulated a greater demand for steel products.

ISRI also challenged Steel Recycling Institute's claim that ferrous scrap prices indicate that inventories of the material are at historic lows, saying that obsolete scrap is the largest component of steel making from recycled material, and obsolete scrap supplies will continue to meet the demands of domestic steel mills and foreign consumers.

Egypt Iron & Steel 2006-07 profit up by 700% YoY

Reuters reported that Egyptian Iron & Steel made a net profit of EGP 197.22 million for the year ending June 2007, up by 700% YoY. Its net profit for the year 2005-2006 stood at EGP 23.61 million.

Egyptian Iron and Steel, which is Egypt's third biggest listed steel company with a market capitalization of EGP 9.28 billion has been going through a restructuring plan led by the ministry of investment.

US weekly crude steel production up by 0.1% YoY

American Iron & Steel Industries reported that in the week ending October 6th 2007 US’s raw steel production was 2,137,000 million net tons while the capability utilization rate was 90.1 %. Production was 2,134,000 million net tons in the week ending October 6th 2006 while the capability utilization then was 86.2%. The current week production represents 0.1% YoY increase from the same period in 2006.

Production for the week ending October 6th 2007 is up by 0.5% from the previous week ending September 29th 2007 when production was 2,125,000 million net tons and the rate of capability utilization was 89.8 %.

Adjusted YTD production through October 6th 2007 was 81,531,000 million net tons at a capability utilization rate of 85.7%. That is a 4.7% YoY decrease from the 85,619,000 million net tons during the same period 2006 when the capability utilization rate was 89.8%

AISI’s estimate is based on reports from companies representing about 75% of the US’s raw steel capability and includes revisions for previous months.

Corus announces price increase for Engineering Steels

Corus has announced that its Engineering Steels will be applying an increase to prices ranging from 3% to 6% on its aerospace products, effective for all orders scheduled for delivery beyond January 1st 2008.

The released said demand for aerospace steels is expected to remain high for the foreseeable future, due to the projected build rates for commercial narrow body aircraft and the development of the next generation of twin aisle jets.

Mechel announces winning auction for Siberian coal deposits

As the results of the auction, which was held on October 5, 2007, Mechel acquired 3,031,488 ordinary registered shares of Yakutugol OJSHC comprising 75% less one share of its charter capital and 586,000 ordinary registered shares of Elgaugol OAO comprising 68.86% of its charter capital, for a total of RUB 58.2 billion.

In addition, a real estate complex owned by JSC Russian Railways was put to the auction and acquired by Mechel The complex includes the railway spur track from Zeisk station of the Far Eastern Railway to the Elga coal deposit and an access road from Zeisk station of the Far Eastern Railway to the Elga deposit.

As the result of its winning at the auction, Mechel’s stake in the charter capital of Yakutugol OJSHC increases to 100%, given that the company already held 25% plus one share in its ownership. Yakutugol OJSHC mines mainly coking coal with a certain steam coal output. Its total coal output is about 10 million tonnes annually. The coal reserves of Yakutugol’s existing assets are estimated at approximately 200 million tonnes according to Russian reserve valuation standards.

Elgaugol OAO holds the license for development of the Elga coal deposit with the total reserves of fat coking coals amounting to approximately 2.2 billion tonnes. According to the experts’ estimates, coal reserves in this region can reach 30 billion to 40 billion tonnes.

Mr Igor Zyuzin CEO of Mechel said that “We are pleased with our victory at the auction. By acquiring Yakutugol, we have gained control over the last operating un privatized coal asset, concluding a three year privatization process. Although there had been some uncertainty among some investors that Mechel would obtain control over Yakutugol, we are glad that we proved our ability to bring all our undertakings to conclusion. Yakutugol will significantly strengthen Mechel’s position on the Russian and international coking coal markets. Secondly, we obtained access to the largest deposit of high quality coking coals, which lays a reliable foundation for long term development of Mechel’s coal mining. With ownership of Southern Kuzbass, Yakutugol and Elgaugol, we hope to establish a world class modern coal mining company. We plan to ship most of the mined coal to Russian consumers including Mechel's subsidiaries.”

West Australia government revises iron ore infrastructure plan

The Australian newspaper, without saying where it got the information, reported that plans for a new iron ore port and rail project in Western Australia have been revised with the state government proposing to split the development into three parts.

As per report, Mr Alannah MacTiernan WA’s planning minister is proposing the parts be funded separately by private investment.

The paper reported that Mr Eric Ripper WA’s deputy premier met with representatives of Mitsubishi Corp in Japan last week to discuss the revised plan. Mr Ripper will travel to China this week to meet with five Chinese government backed organizations that have signed accords with Yilgarn Infrastructure Ltd.

Yilgarn, backed by China’s Sinosteel Corp the Export Import Bank of China and Australian iron ore mining company Midwest Corp, is seeking to build the AUD 3 billion port and rail project. Japan’s Mitsubishi and mining company Murchison Metals Ltd are also seeking rights to the project.

FAS to decide on Gazprom and SUEK JV by October end

Interfax reported that the Russian Federal Antimonopoly Service will decided its position regarding the impact of the proposed JV between Gazprom and Siberian Coal and Energy Company on the Russian energy market by the end of October 2007.

Mr Anatoly Golomolzin deputy director of FAS said that “FAS is assessing the JV position on the market with changes to anti monopolies legislation taken into consideration. If the JV share of a single free electricity zone exceeds 20% then options of a structural nature including the mandatory sale of selected generating capacity are possible."

SUEK, Russia's biggest coal producer and Gazprom, the country's gas monopoly, reached a preliminary agreement to pool their coal and power generating assets back in February. They said they would close the transaction during the first half of 2007. At one of their first meetings the companies laid down a plan of action, according to which a list of assets for inclusion in the joint venture was supposed to be ready by April 1st 2007.

SUEK plans to contribute almost its entire business, thought by analysts to be worth USD 5 billion to USD 7 billion, to the joint venture. The Gazprom assets have not officially been announced, but market sources reckon the Russian gas monopoly would limit its contribution to its 10.5% stake in Unified Energy System.

Both companies are among the biggest strategic investors in the Russian power sector. In addition, they both play a key role in supplying the power sector with fuel. Gazprom is the biggest gas supplier to Russia's power stations and SUEK is their biggest coal supplier. Gazprom estimates that the proposed joint venture would control 49,000 MW of Russian power generating capacity.

Ma'anshan bags order for 2nd line of West East gas pipeline

It is reported that China's Ma'anshan Steel has inked contract to supply 1000 tons of pipeline steel for the second line of West-East Gas Pipeline, which starting from Xinjiang's Huoerguosi and ending at Shanghai and Guangxi's Nanning.

The line lasts over 7000 kilometers and would consume 4 million tonnes of X80 grade coil and plate including 2.24 million tonnes of coils. The line is scheduled to start construction from December of 2007 to 2011. The long gas pipeline requires steel with high strength and tenacity and satisfying corrosion resistant and temperature difference proof performances.

Ma'anshan Steel began trial production of 2250mm HR in this May and rolled out qualified pipeline steel two months later.

(Sourced from MySteel.net)

ArcelorMittal announces publication of notices for EGMs

ArcelorMittal announced the publication of the convening notices for an Extraordinary General Meeting of shareholders of ArcelorMittal and for an Extraordinary General Meeting of shareholders of Arcelor, both to be held on November 5th2007.

ArcelorMittal said that both meetings will take place at Luxembourg and will deliberate on the steps required to bring about the merger of both companies, as announced on September 26th 2007.

S&P assigns BB rating with positive outlook to Klöckner & Co

Standard & Poor's announced that its assign 'BB' rating and positive outlook on German metal distributor Klöckner & Co AG will remain unaffected by the company's announcement that its 2007 results will be impacted by price declines in the third quarter.

S&P said the company's solid credit profile has sufficient flexibility to absorb the adverse financial impact of reduced stainless steel prices and resulting write down in inventory value.

Although S&P expressed concern over the big fall in Knocker’s gross margins, it sees the financial impact limited to the third quarter and offset by subsequent profitable growth.

Puda Coal appoints Mr Tang as independent director

Puda Coal Inc announced the appointment of Mr C Mark Tang as an independent director to its board of directors. This appointment increases the size of the board of directors to 4 members, the majority of which are independent.

Mr Tang is the founder and chairman of World Technology Ventures, LLC, an international merchant banking and advisory firm specializing in financing and advising healthcare biotechnology and small medium enterprises in the US and Asia. Prior to his current position at establishing World Technology Ventures LLC, he was a member of the faculty and director of Biotech Commercialization at Rutgers Business School in New Jersey. He has over ten year's experience as a senior biotech analyst, investment banker, venture capitalist and investment advisor through his work at global investment banks including Paine Webber and Morgan Stanley.

Mr Zhao Ming chairman & CEO of Puda Coal said that "Mark brings a strong financial background to the board with extensive experience in financial operations, capital markets, and investment management that can be applied to a diverse set of industries. We are very pleased to have him join us as a new independent director, and we look forward to his contribution as Puda Coal continues to develop its platform for future growth and success."

Puda Coal, through its subsidiary Shanxi Coal, supplies coking coal to the steel making industry for use in making coke and currently possesses 3.5 million tonnes of annual coking coal cleaning capacity.