Indian government likely to approve new mineral policy this month

It is reported that the new National Mineral Policy, will be put before the cabinet for approval this month and may be tabled in Indian parliament in the winter session. National Mineral Policy seeks to remove the bottlenecks impeding investments in the mining sector, where the government expects an investment of nearly INR 100,000 crore in the next 10 years.

Mr T Subbirami Reddy minister of state for mines while speaking at a Federation of Indian Mineral Industries function said that "The National Mineral Policy is ready and we will seek the Union cabinet's approval on it this month. Once the cabinet's nod is received, we intend to table it in parliament in the coming winter session."

Mr Reddy said that "To facilitate more investments in the mining sector, National Mineral Policy will have a single window clearance system where ministry officials concerned will together address the bottlenecks impeding investments." He added that union mining ministry would also try to ensure the same system, while deciding on mining lease applications.

Mr Reddy clarified that “There is no attempt to take away the powers of the mineral rich states in deciding the fate of mining leases. "I have spoken to the governments in these states and they now seem to be convinced. Although states would continue to enjoy their right to decide on mining lease applications, they are bound to complete this exercise within 15 months. We will not deprive the mineral rich states of their say in the National Mineral Policy, but they cannot sit indefinitely on mining lease applications and would have to dispose them of within a stipulated time.”

However, CPI(M), has disapproved the proposed policy as it allows unfettered export of iron ore. It said "This would be short sighted and harmful policy. Indiscriminate exports of iron ore and other mineral resources will denude India of its natural resources. The Politburo demands that the mining policy not be approved by the union cabinet and be placed before the Parliament for further discussion.”

Iron ore exports from Goa in H1 down by 15%

BL reported that some miners feel that Goa’s iron ore exports might not touch last year’s figure of 40.5 million tonnes as it is down by around 15% YoY in April to September period and that the reduction in export volumes may hit the private iron ore export industry as they are already reeling under the continuing appreciation of the rupee.

The report cited a sources in the Goa Mineral Ore Exporters’ Association as saying that “This itself could mean a reduction of over 10% in export earnings, should the rupee continue to appreciate.” Industry representatives pointed out about the adverse effect of export duty on the exports of the iron ore in the beginning of this financial year, which was subsequently reduced substantially on low grade ore but many shipments between March and April were cancelled.

However, the report added that the iron ore exporters are not perturbed by the poor performance in the first part of the year, as it largely comprises the monsoon season but are really apprehensive about the congestion at the port, which could affect overall export performance as the season is about to take off. GMOEA is worried over the virtual collapse of one of the two ship loaders at the iron ore export berth at the Mormugao Port Trust, which could delay operations, resulting in increase in demurrage charges. The ship loader is expected to be back in operation by the end of November.

However, the effect of almost doubling of iron ore prices is not outlined by the exporters in this report, which is likely to take care of the reduction in volumes, strengthened rupee and other issues.

TATA Steel may build captive jetty on Haldia river front

It is reported that TATA Steel is keen to have its own jetty on the riverfront at Haldia in West Bengal.

As per report, Mr B Muthuraman MD of TATA Steel in a letter to the Chairman of Kolkata Port Trust wrote “The projected increase in our traffic calls for a dedicated berthing and handling facility captive in nature at Haldia. We will design, construct and develop our own captive riverine jetty at Haldia to meet our export import throughput requirement.”

As per report, Mr Muthuraman has expressed his desire to have the jetty commissioned on September 1st 2009. The plan is to sign the concession agreement by May 2008, start construction of the jetty and development of backup facilities by September 2008 and complete construction and installation of equipment by August 2009.

As per report, the proposed project is estimated to cost INR 100 crores. The proposed jetty will primarily handle clean cargo and have the final capacity of 2 million tonnes annually. The location of the jetty should be outside the lock gate but not far from the existing oil jetties on the riverfront. There should be an open back up storage space of 15 acres with a railway siding of 800 meters and two mobile harbor cranes. The draft of the Hooghly river at the jetty should be the same as that at present.

TATA Steel’s current throughput of export import traffic at Haldia is around 2 million tonnes with about 90% being accounted by imports of raw materials such as coking coal, limestone, coke and other materials. The raw material requirement is projected to rise many times more with the expansion plans underway.

RKKR steel to double capacity of alloy steel plant in Nellore

BL reported that Chennai based RKKR Steels Limited has decided to set up an integrated alloy steel project in the country at Kolanakoduru of Manobolu mandal in Nellore.

RKKR Steel had earlier proposed to set up the integrated alloy steel project in three phases under the special purpose vehicle Special Bar Quality Steels Limited with an investment of INR 500 crore with a production capacity of 0.25 million tonnes per annum and has already acquired 151.63 acres of land for the plant.

But it has now decided to invest more than INR 1,100 crore to set up alloy steel project at Kolanakoduru in more than 500 acres of land with a production capacity of 0.5 million tonnes per annum. Besides, it will set up 60 MW thermal power project based on imported thermal coal,

SBQ Steels Limited will have sinter plant, blast furnace with down stream steel making and rolling facilities to manufacture alloy and special steel required for the automotive and engineering sectors and is expected to begin its commercial operations in September 2008.

Essar to complete Minnesota acquisition by November

Metal Bulletin reported that Essar Steel’s subsidiary Essar Global will complete the USD 1.6 billion acquisition of US based Minnesota Steel by the end of November 2007, following acceptance of its environmental impact study in September 2007.

The report cited Mr Alain Davezac executive VP of Essar Global as saying that after the acquisition, Minnesota will build an iron ore mine, a pellet plant, hot briquetted iron plant and 1.5 million tonne per year melt shop in the first phase. He told that “In the second phase, the Minnesota slab capacity would be raised to 3 million tonnes and the excess tonnage would be sold to third parties.”

He added that "Our strategy is becoming clearer and clearer. 5 years ago, Essar was a 2 million tonnes steel maker, today it is on the verge of being 8 million tonnes and in the 5 years' time it will be 15 million tonnes to 20 million tonnes."

Metal Bulletin also quoted Mr Prashant Ruia director of Essar Group as saying that the company's North America plans reflect a new steel strategy that is emerging for the group worldwide.

Essar is spending nearly USD 3 billion to double its slab capacity in the company's Hazira plant in Gujarat to 9 million tonnes. It is also planning new iron ore mining projects in Orissa, where it would build a 12 million tonnes beneficiation plant near Paradip.

S&P forecasts Indian economic growth at 9% in 2007

Standard and Poor expects India's economy to grow by 9% in 2007 and 8.8% in 2008.

S&P in a recent report also said that Indian interest rates are clearly peaking and the rupee is likely to end the year at 40.5 per dollar.

The Reserve Bank of India forecasts the Indian economy to grow by 8.5% in 2007- 08.

L&T chief calls for imposing AD on Chinese imports to save Indian industry

BL reported that Indian engineering major Larson & Tubro feels that the rupee appreciation, combined with the Chinese artificially locking in their currency, is affecting some of the manufacturing units in the company and wants Indian government to impose anti dumping duty on China till they float yuan before Indian manufacturing is badly affected.

Mr AM Naik CMD of L&T told BL “We are struggling. We can not give up something unless we make a full representation to the government. My appeal to the Government is impose 30% anti dumping duty on China until such time they float the currency. The day they float the currency, withdraw it.”

Mr Naik said that “While the rupee is free floating, the Chinese currency yuan is artificially locked in at a low price. If China freely floated its currency, it would appreciate within a week and then all of L&T’s units would become competitive.”

He said that “He had taken this up with the government, including the finance and commerce ministers and highlighted that Indian industry would be wiped out, if not badly affected, by Chinese imports. If these businesses did not do well, the company would be forced to either close them down or sell the units.” He has asked Indian government to take the matter to the WTO to straighten out the issue.

As per report, L&T has a number of manufacturing units that are affected by imports from China.

Vesuvius India to expand Kolkata unit and set up one at Vizag

It is reported that Vesuvius India Limited is planning to expand its refractory manufacturing capacity at its Kolkata unit and also set up a new unit at Vizag to match the likely expansion of steel capacities in India and also cater to boiler linings in power sector.

As per report, the work on doubling of the capacity at Vesuvius India Limited’s refractories manufacturing facility in Kolkata will be taken up in January 2008. Estimated to cost INR 50 crore, the expansion project will be completed by 2009. Mr Tanmay Ganguly MD of Vesuvius India Limited said that the Kolkata plant is equipped to manufacture 800 pieces of refractories daily and after expansion, this would go up to 1,600 pieces per day.

Vesuvius India Limited is also setting up another 40,000 tonnes per annum capacity refractory manufacturing unit in Vizag at an estimated investment of around INR 12 crore.

According to Mr Ganguly, while the steel industry contributes to around 70% of Vesuvius India’s revenue, it would now focus on the power sector as well.

However Mr Ganguly expressed serious concern over the steep increase in the prices of raw materials required by the refractory manufacturers and said that “We are looking at a combination of internal efficiencies and an increase in the prices of our product offerings.”

9 firms reported to be in fray for Krishnapatnam UMPP

It is reported that 9 firms are in the fray for 4,000 MW Krishnapatnam ultra mega power plants in Andhra Pradesh after 4 firms including AES China have pulled out of the race.

As per reports, the list of interested bidders include Reliance Power, TATA Power, Essar Power, Sterlite Industries, Larsen & Toubro, DS Construction, Japan's Sumitomo Corp and CLP GMR combine.

Power Finance Corporation, the nodal agency for ultra mega power projects, has extended the last date for accepting bids for Krishnapatnam project to October 24th 2007. PFC has extended the last date for accepting bids several times. It had last extended the date to September 21st 2007 from August 25th 2007. The request for proposals for Krishnapatnam project, which would run on imported coal were issued in April 2007.

REL and TATA Power have already bagged 1 ultra mega power project at Sasan and Mundra respectively.

NHPC awards Chutak power project to BHEL

It is reported that National Hydroelectric Power Corporation has signed an agreement with Bharat Heavy Electrical Limited for execution of electrical and mechanical works package of its 44 MW Chutak hydroelectric power project in Kargil district of Jammu & Kashmir at a cost INR 227.73 crore.

The scope of work involves design, manufacture, supply, transportation to site, handling, erection, testing & commissioning works of turbines including digital type governing system, generators along with static excitation system, DVR including associated accessories and auxiliaries, generator step up transformer, bus duct, computer based control, protection and monitoring equipment and all other electrical and mechanical auxiliaries.

The Chutak project would harness the hydropower potential of river Suru in Kargil. The barrage of the project is located near village Sarzhe and the power house in near village Chutak. The project is expected to generate 212.93 million units in a 90% dependable year.

GAIL signs gas sales agreement with Pragati Power

It is reported that GAIL India Limited has inked a gas sales agreement with Pragati Power Corporation to supply 2 metric million standard square cubic meters per day of regassified LNG.

The gas supply for 1,500 MW combined cycle gas turbine power project to be set up by Pragati Power Corporation at Bawana will commence from October 2009 and the validity of this agreement will be till the year 2024. The power plant is expected to be fully commissioned by October 2010.

Gas will be sourced from Petronet LNG Limited and GAIL will be transporting it to PPCL for which a MoU has already been signed with BPCL and IOCL. Further, to bring gas from Dadri to Bawana, pipeline with 2 compressors will be laid. A loop line will also be laid in the GREP pipeline system of GAIL, which involves INR 5000 crore investments.

The regassified LNG shall be supplied to PPCL Bawana and the price of delivered gas will be in line with pooled price policy directive issued by ministry of petroleum & natural gas.

NALCO inducted new independent directors

SNS reported that NALCO has inducted Dr A Sahay, Mr SS Sohoni and Mr KS Raju as independent directors for a period of 3 years.

While Dr Sahay is a professor in the MDI in Gurgaon, Mr Sohoni is an IAS officer of the 1970 batch and former secretary to the President of India and Mr Raju is the former controller general of Indian bureau of mines.

Jaipur district administration holds talks over NINL dispute with villagers

SNS reported that in a bid to resolve the deadlock between Neelanchal Ispat Nigam Limited with Sarangapur villagers over the issue of displacement in Kalinga Nagar, administration of Jajpur and Kalinga Nagar and Mr DS Kute superintendent of police held talks with the irate villagers.

The villagers alleged that NINL has been polluting the ground water the natural resources of the village, damaging the roads and destroying cultivable lands Organized under the banner of the Sangram Jan Manch, villagers have been demanding an immediate displacement with adequate compensation and rehabilitation packages. Sangram Jan Manch has locked all the entrance and exit gates of the NINL twice, protesting against the plant’s dilly dallying attitude towards the villagers’ displacement issue.

Mr Harekrushna Sahoo leader of Sangram Jan Manch said that “The Sarangapur village has over 650 residents. The plant is located in close proximity to our village, as a result of which dust, smoke and other effluents are causing harm to our lands and polluting the water bodies, besides spreading various diseases among the villagers.”

PFC Q2 net profit up by 22.5% YoY

Power Finance Corporation Limited has announced that it has posted net profit of INR 282.22 crore for the July to September 2007 quarter up by 22.5% YoY as against INR 230.35 crore in July to September 2006 quarter while, total income rose to INR 1,227.5 crore in July to September 2007 quarter from INR 889.91 crore in July to September 2006 quarter.

MEPS forecasts 100 million tonne steel output addition in 2007

MEPS forecast that global steel production is now expected to reach over 1.35 billion tonnes in 2007 up by 8.5% YoY. Asian steel makers will account for 56% of the global steel output in 2007. Chinese and Indian producers will contribute around 73% of the extra 100 million tonnes manufactured this year.

MEPS forecast that BF iron making in 2007 would be over 955 million tonnes up by 9.3% YoY from 874 million tonnes in 2006 and DRI production in 2007 would be 63.4 million tonnes.

In million tonnes
Source MEPS

US ITC keeps AD duty on HR from China, India, Indonesia, Taiwan, Thailand and Ukraine

The US International Trade Commission announced its determinations in its 5 year sunset reviews concerning hot rolled steel products from Argentina, China, India, Indonesia, Kazakhstan, Romania, South Africa, Taiwan, Thailand, and Ukraine.

US ITC said that “With respect to the existing countervailing duty orders on hot rolled steel products from India, Indonesia, and Thailand and the existing antidumping duty orders on these products from China, India, Indonesia, Taiwan, Thailand, and Ukraine, the it determined that revoking the orders would be likely to lead to continuation or recurrence of material injury within a reasonably foreseeable time. As a result of these affirmative determinations, the existing orders on hot rolled steel products from China, India, Indonesia, Taiwan, Thailand, and Ukraine will remain in place.”

It added that “But with respect to the existing countervailing duty orders on hot rolled steel products from Argentina and South Africa and the existing antidumping duty orders on these products from Argentina, Kazakhstan, Romania, and South Africa, the Commission determined that revoking the orders would not be likely to lead to continuation or recurrence of material injury within a reasonably foreseeable time. As a result of these negative determinations, the existing orders on hot rolled steel products from Argentina, Kazakhstan, Romania, and South Africa will be revoked.”

This action comes under the 5 year sunset review process required by the Uruguay Round Agreements Act. The reviews concerning Hot Rolled Steel Products from Argentina, China, India, Indonesia, Kazakhstan, Romania, South Africa, Taiwan, Thailand, and Ukraine were instituted on August 1st 2006.

Global crude SS production in H1 up by 9.1% YoY

Preliminary figures released by the International Stainless Steel Forum show that global stainless steel crude steel production has increased in the first half of 2007 by 9.1% YoY. Total production for the first six months of 2007 was 15 million tonnes.

In Asia, stainless steel production grew by 20.2% YoY to 8.5 million tonnes. Driving forces were again China with 54% YoY and India with 7% growth. China produced 3.5 million tonnes of stainless crude steel and has increased its lead as the world’s leading SS making nation. The strong production increase is mainly based on new capacities. The growth will continue for the rest of 2007 as further new capacity is commissioned. Production in Japan has compensated for last year’s losses.

The second biggest producing area, Western Europe and Africa reported a 3.1% YoY decrease in stainless steel production during the first six months of 2007. Total production was 4.9 million tonne in this period. In The Americas region, stainless crude steel production declined by 2.1% YoY to 1.4 million tonnes in the first half of the year.

Stainless and heat-resisting crude steel production details

In 000 tonnes
Source: International Stainless Steel Forum

ISSF forecasts that healthy demand from end users will remain, but production will slow down considerably due to de-stocking. During the rest of 2007 ISSF predicts the use of stainless steel in fabrication will continue to grow. However, following the trend from the first half of 2007, apparent consumption will slow down considerably, showing negative growth rates compared to the second half of 2006. This is based on a stronger than expected need for de stocking at stockholders and stainless steel fabricators. The de stocking is influenced by the decrease in the price of nickel. Stockholders and fabricators are trying to reduce stocks of stainless steel that contain high-priced nickel.

As a result, ISSF has lowered its stainless crude steel production forecast to 1.1% growth for the whole of 2007. This would mean total production of 28.7 million tonnes in 2007. In May 2007, ISSF forecast growth of 5.1% for 2007. The new forecast stainless and heat resisting crude steel production for 2007 is as under

In 000 tonnes
Source: International Stainless Steel Forum

Hot band spot price movement mixed during last fortnight

SteelBenchmarker reported that the US hot rolled band spot price for October 8th 2007 rose 0.7% to USD 580 per metric tonne, FOB the mill for the fourth consecutive time. The World export HRB price rose 1.6% to USD 583 per tonne, FOB the port of export, for the third consecutive time. The Chinese HRB ex works price fell by 1.0% to USD 472 per tonne, for the second consecutive time. The Western European HRB price dropped by 0.4% to USD 677 per tonne, ex works after two consecutive rises.

USA
USD 580 per metric ton FOB mill
Up by USD 4 per ton from USD 576 two weeks ago
Down USD 50 per ton from USD 630 on April 9th 2007
Up by USD 20 per ton from USD 560 on August 13th 2007

China
USD 472 per metric tonne EXW
Down by USD 5 per tonne from USD 477 two weeks ago
Down by USD 15 per tonne from USD 487 a month ago
Up by USD 15 per tonne from USD 457 on May 14th 2007
Up by USD 70 per tonne from USD 402 on July 9th 2007

Western Europe
USD 677 per metric tonne EXW
Down by USD 3 per tonne from USD 680 2 weeks ago
Down by USD 19 per tonne from high of USD 696 on June 11th 2007
Up by USD 17 per tonne from the low of USD 660 on March 12th 2007

World Export Price
USD 583 per metric tonne FOB port of export
Up by USD 9 per tonne against USD 574 two weeks ago
Down by USD 13 per tonne from USD 596 on March 26th 2007
Up by USD 33 per tonne from USD 550 on July 23rd 2007

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

Murchison makes AUD 986 million bid for Midwest

Murchison Metals Limited announced its intention to make an unconditional takeover offer to acquire all of the shares in Midwest Corporation Limited.

Under a two tiered offer structure, Murchison is offering a higher price for Midwest shares if Murchison is reasonably satisfied, prior to the end of the offer period, that Midwest will not incur a material tax liability if Midwest sells a 50% interest in the Weld Range and Koolanooka projects to Sinosteel Corporation. The Base Price offered by Murchison is 1 new Murchison share for every 1.16 Midwest shares held. The Base Price values your Midwest shares at AUD 4.38 each and represents a premium of 25% based on the closing price of Midwest shares and Murchison shares on 9 October 2007. The Higher Price is 1 new Murchison shares for every 1.08 Midwest shares held. The Higher Price values your Midwest shares at AUD 4.70 each and represents a premium of 34% based on the closing price of Midwest shares and Murchison shares on October 9th 2007.

The highlights of offers are
1. Unconditional offer
2. Substantial premium via two tier offer structure
3. Compelling financial and strategic logic
4. Combined Stage 1 projects with planned production of 4 million tonnes per annum in 2008
5. Combined Stage 2 projects with targeted iron ore production of 45 million tonnes per annum.
6. Potential for superior value creation through synergies and optimized project development

Murchison believes that the combination of Murchison and Midwest represents a unique opportunity to unlock cost and revenue synergies, accelerate the development of the emerging mid west iron ore province and provide greater certainty for the development of new mid west port and rail infrastructure. Murchison believes the proposed offer is compelling. Midwest shareholders will benefit from an immediate uplift in the value of their investment in Midwest and will also share in the value that Murchison believes will be created if Midwest and Murchison jointly develop the Jack Hill's and Weld Range projects. These are highly complementary projects with similar ore types, located in the same geographic region and relying on the same rail and port infrastructure.

Mr Paul Kopejtka executive chairman of Murchison said that "We have held a number of discussions with Midwest directors who represent Midwest's major shareholder seeking to agree terms for a merger. Whilst it was apparent from those discussions that the benefits of combining Midwest and Murchison were well recognized, we could not agree merger terms. We therefore decided to make this offer so that the full Midwest board and all Midwest shareholders can consider what we believe to be the compelling merits of combining the two companies."

Murchison is being advised by Gresham Advisory Partners Limited, RBC Capital Markets and Franklyn Legal on this deal.

POSCO seeking US or European steel maker for mega merger

It is reported that POSCO would be keen on a sizeable merger with a suitable US or European company if the right opportunity presented itself.

Mr Lee Ku Taek CEO of POSCO while speaking at the International Iron and Steel Institute's meeting in Berlin said that “It would depend on the right situation. I support the idea of a more globalize steel industry and POSCO cannot be said to be globalized while we have no more than 5% of our steel being consumed outside Asia.”

He said that it would be open to the idea of expanding in Europe or the US on account of good market opportunities for selling high value steel an area in which POSCO has expertise for instance, to the motor industry.

He said that “If there was a chance to get greater access to the European or North American markets I'd take it, but it would have to be on terms that aided our overall competitive position.”

But Mr Lee did not name potential merger partners but observers believe they could include ThyssenKrupp and US Steel.

ArcelorMittal announces industrial plan for Liège

ArcelorMittal has unveiled its industrial plan for the Liège region.

Mr Michel Wurth member of ArcelorMittal's Group Management Board explained to staff representatives it's plan for the region with regards to the steelworks' upstream and downstream activities like cold phase and packaging to R&D and to its contribution to the economic redeployment of the region.

In view of a much stronger demand than anticipated in 2003, ArcelorMittal has decided to rebuild an integrated steel plant in Liège. In this context, it is currently realizing the investments required to refire the Seraing blast furnace. It added that measures would have to be taken to bring the Liège steelworks' production costs to the level of the Group's other European plants. In addition, the continuation of production in Liège is subject to the sustained availability of the necessary CO2 quota.

Regarding the downstream activities, ArcelorMittal intends to focus Liège on high return and high technology activities, such as Arceo, its prototype plasma vacuum coating line. Management pointed to the very negative evolution of the packaging market and to the need to reduce packaging steel exports and the Liège based production of this product.

ArcelorMittal announced its intention to further develop its R&D facilities in Liège, so as to give the region a strong innovative impetus fit to attract new industrial activities. The Group has also confirmed its contribution to the economic redeployment of the Liège region on the basis of local partnerships and of the experience acquired over the past four years, eg the creation of Magnetto Automotive Belgium and spinoffs. Under an ArcelorMittal mandate, Sodie to date has signed 107 conventions for a total of 1700 new jobs of which 650 have already been created.

Mr Wurth said that “In view of the new bases for social dialogue, rooted in trust and transparency, it was important for us to discuss the new industrial plan in the framework of constructive consultation between social partners. Our ambition for Liège is to rebuild an integrated steel plant based on high return and high technology products.”

Japanese steel majors plan to double overseas auto steel output

Nikkei, without citing source, reported that Japan's top four steel makers Nippon Steel Corporation, JFE Steel Corporation, Sumitomo Metal Industries Limited and Kobe Steel Limited are planning to double their overseas production of automotive steel sheet in three years to capture a combined 40% share of the market.

The report said that Nippon Steel Corporation, JFE Steel Corporation, Sumitomo Metal Industries Limited and Kobe Steel Limited produce a combined 4 million tons of automotive steel sheet at overseas facilities each year, but if expansions go as planned, total production volume will rise to almost 8 million tonnes by 2010, which is about 70% of domestic steel sheet output and 40% of the global market.

As per report, JFE Steel will soon outsource production to ThyssenKrupp to provide products to European plants of companies such as Toyota Motor Corp, Sumitomo Metal will outsource production to TATA Steel to supply Japanese automakers in Europe. Kobe Steel has begun considering expanding its JV with US Steel and Nippon Steel plans to spend more than JPY 100 billion to double overseas output, which is currently at just under 3 million tonnes per year.

Sea bulk freight rates climb to record levels

According to the Baltic Exchange Coal and iron ore freight rates rose to a record as demand for the largest type of dry bulk vessel gained after a weeklong holiday in China and gains in the shipping futures market. The Baltic Dry Index, an overall measure of commodity shipping costs on different routes and ship sizes, rose 1.4% to 9,665 recently surpassing its previous high of 9,566 on October 2nd 2007.

Charter rates have more than doubled in the past year on surging demand for raw materials, led by China and India, the world's most-populous nations. Gains in the shipping futures market and congestion at major ports have pushed rates higher.

Mr Ryu Je Hyun a Hong Kong based analyst at Mirae Asset Securities Co said "We saw a correction last week because of the Chinese holidays but now the market is hotter than we estimated. Rates may rise further should there be more demand for thermal coal as we enter the winter season and Chinese steel mills produce more steel after the monsoon season."

LME announce first steel billet brands for future trading

The London Metal Exchange announced that it has selected three brands of steel billet that will be delivered to all buyers of its new steel billet futures contracts to be launched next year.

LME in a statement said that “There are two brands from the Greek producer Hellenic Halyvourgia and one from the Turkish producer Colakoglu Metalurji.”

It added, "Like other LME futures contracts, the steel contracts will be backed by physical stock that will be warehoused, stored and available for delivery up to 15 months forward.

Ms Liz Milan manager of LME steel business said that “Physical delivery is an indispensable part of the LME steel billet futures contract in that it provides price convergence and credibility. Producer brands that conform to the LME’s exacting requirements are one of the most vital aspects of this approach. We will launch the steel contracts on the floor of the Exchange on April 28th 2008. They will be soft launched on Select and the telephone market on February 25th 2007. We are making good progress as those dates come closer and I am particularly pleased to be able to announce that, some nine months before the first cash date falls prompt, we have listed the first brands of billet that will be deliverable against the contracts.”

Carnavale acquires two iron ore tenements in Brazil

Australian based resources company Carnavale Resources Limited announced that it has signed an agreement with Puma Metals Mineracao Ltda to acquire additional two iron ore projects in Brazil.

Under the terms of the new agreement, Carnavale will pay US$1.105m to Puma based on staged payments up to a period of 36 months from the date of the agreement. A further US$1.5m is due after the calculation of JORC standard mineable reserves and US$1.4m is due upon the commencement of mining activities.

Highlights:
1. The Maraba project comprises 160 square kilometer of tenement area in Brazil, surrounded on the eastern and western sides by tenements held by MMX Mineracao Ltda and actively exploring the area for iron ore.

2. The Pancada project comprises 80 square kilometer of tenement area in Brazil and was delineated based on a prominent regional air magnetic trend extending through the property.

Carnavale Resources Limited is a mineral exploration company listed on the Australian Stock Exchange and on the Frankfurt Stock Exchange with its registered office at Balcatta in Western Australia.

Mr Lisin of NLMK gains control of Northwest Shipping

Interfax reported that Mr Vladimir Lisin, who controls Russian steel major Novolipetsk Steel, has acquired control of Northwest Shipping Company. Mr Lisin owns Havensight Shipping, which owns 62.42% of Northwest Shipping Company.

Mr Viktor Olersky chairman of Northwest Shipping Company's board of directors told Interfax that changes had occurred among the its shareholders, but he declined to say who had bought and sold shares.

Nanjing Steel to set up 1.5 million tonne steel mill in Indonesia

Interfax China reported that Nanjing Iron & Steel Group is planning to build a 1.5 million tonne steel mill in the Indonesian province of South Kalimantan in 2008 with a total investment of roughly USD 500 million.

Mr Anshari Bukhari director general for metal, machinery and textiles at the Indonesian department of industry said that the steel mill project, designed with a capacity to produce up to 1.5 million tonnes of billet and slab could see production capacity expanded to 2 million tons in the future. He added that Nanjing Steel wanted to team up with a local hot rolled coil manufacturer, Gunung Garuda Group, to ensure supply of the basic materials.

Raw material for production including coal and iron ore will be predominantly sourced in Kalimantan and if needed, the project will also import iron ore from Australia.

Mr Jia Liangqun an analyst with Mysteel told Interfax that "A trend is developing in which Chinese steel mills are establishing steelworks overseas, as China has become a net steel exporter. Chinese steel makers are looking for opportunities in growing economies, like India, Brazil and Indonesia, where they have abundant resources and increasing demand, whereas further expansion at home is relatively limited."

German steel makers take lead on AD action on Chinese steel imports

Interfax China citing Beijing based Custeel reported that Germany's two largest steel mills ThyssenKrupp AG and Salzgitter AG have raised the issue of AD sanctions against Chinese steel product exports at the International Iron and Steel Institute AGM held in Berlin on Monday. As per report, both ThyssenKrupp and Salzgitter have submitted a formal complaint to the European Commission in Brussels last weekend.

According to an announcement on the Stahl-Zentrum website, an umbrella organization for the German steel industry, the German federal government supports AD measures against Chinese steel product exports and dispatched the federal minister for economic affairs Mr Michael Glos to the AGM in order to hurry the process along.

However, European Union Industrial Commissioner Mr Gunter Verheugen commented that it is still unclear as to whether the European Commission will implement AD and CVD measures against China, as investigations have not yet been completed.
According to a presentation given at the AGM by Mr Dieter Ameling, president of the German Steel Federation and chairman of the Steel Institute VDEh, a number of European steel producers are currently preparing anti-dumping cases against China. However, the use of trade sanctions is always a last resort when all political initiatives have been exhausted in order to protect EU industry against unfair trade practices. Mr Ameling also advised China that instead of exporting steel produced at the expense of the Chinese environment, they would do better to remove their uneconomical and heavily polluting capacities from the market in order to prevent the current dispute from becoming a long standing trade conflict.

The EU is currently China's second most important export market after Asia, receiving approximately 17% of China's annual exports. China's steel product exports to the EU are set to double from last year to 10 million tonnes this year, after only having passed the 1 million tonne mark in 2005.

US Metalforming terms continuation of AD on HR as sever blow for manufacturing

Mr William E Gaskin president of Precision Metalforming Association has expressed sever disappointment at the US International Trade Commission's decision to continue the anti dumping and countervailing duties on hot rolled steel from six of the ten countries under review, including the most significant hot rolled steel exporters, calling the verdict a tough blow for American steel consumers.

Mr Gaskin said that "It is unfortunate that today's vote by the ITC missed the fact that American steel consumers need access to steel products at globally competitive prices, and that the US steel industry is world class, healthy, highly profitable and no longer in need of government protection from international competition on hot rolled steel products. Steel products, especially hot rolled, are a major input for American manufacturing companies, accounting for up to 70% of their costs. Today's decision ignores the reality of the marketplace to remain competitive and meet customer demand industrial consumers need to count on consistent supplies of globally priced raw materials. This decision provides another blow to American metal formers and other manufacturers already struggling to successfully compete in the global marketplace."

Mr Gaskin continued that "Today's vote underlines the importance for Congress to pass the American Manufacturing Competitiveness Act, introduced by Reps. Joe Knollenberg and Ron Kind. The legislation would provide US industrial users with full interested party standing throughout the AD CVD process and require that the ITC consider the impact its decisions will have on domestic industrial consumers of the products in question. This bill will help guard against the ITC making more decisions like this one that result in greater harm than benefit to American manufacturers."

US ITC voted to continue anti dumping and countervailing duties on China, India, Indonesia, Taiwan, Thailand and Ukraine, and to terminate the duties for Argentina, Kazakhstan, Romania and South Africa. The duties on hot rolled imports from The Netherlands were rescinded earlier due to the US Department of Commerce decision to comply with a World Trade Organization ruling to end the use of zeroing in certain trade cases. The use of zeroing inflates margins in dumping calculations. The remaining duties will be left in place until the next ITC review in 2012.

The Precision Metalforming Association is the full service trade association representing the USD 91 billion metal forming industry of North America the industry that creates precision metal products using stamping, fabricating and other value added processes. Its nearly 1,200 member companies include metal stampers, hot rolled fabricators, spinners, slide formers and roll formers as well as suppliers of equipment, materials and services to the industry. Members are located in 30 countries, with the majority found in North America as well as Canada and Mexico.

Odebrecht to reconstruct iron ore infrastructure in Liberia for ArcelorMittal

It is reported that ArcelorMittal has awarded Brazilian construction giant Odebrecht a USD 21 million contract to refurbish a railway and port serving its planned iron ore mine in Liberia.

Mr Malay Mukherjee of ArcelorMittal group management board told a news conference that Odebrecht would undertake reconstruction of the port of Buchanan, repair the 300 kilometers railway line to Yekepa in northern Liberia and survey the disused mines there.

Liberia was the world's 5th largest producer of iron ore before a devastating 1989-2003 civil war, which killed some 200,000 people and laid waste to the West African nation's infrastructure. ArcelorMittal announced the USD 1 billion investments in Liberia as part of its drive to becoming increasingly self-sufficient in supplies of iron ore. Arcelor Mittal expects to ship its first iron ore from the mine by the end of 2009.

Norilsk Nickel acquires 100% of Lion Ore

Norilsk Nickel has acquired 100% of the shares of Canadian Lion Ore Mining Ltd for USD 5.234 billion. Norilsk Nickel acquired 46 million of Lion Ore ordinary shares totaling USD 1.190 million in August of 2007 and 90.7% of Lion Ore ordinary shares for USD 5.233 billion in June of 2007.

LionOre is nickel and gold producer in Australia, Botswana and South Africa. The company produced more than 34,000 tonnes of nickel and 155.2 ounces of gold in 2006. LionOre also produces copper, cobalt and platinum group metals.

Norilsk Nickel Group is one of the largest companies in the world producing precious and non ferrous metals. It produces more than 20% of nickel, 10% of cobalt and 3% of copper in the world market. Norilsk Nickel produces more than 96% of nickel, 55% of copper and 95% of cobalt in the domestic market.

Corus to sell aluminum plants in Germany and Netherlands

Reuters reported that TATA Steel owned Corus would put its primary aluminum smelters in Germany and the Netherlands up for sale after electricity contracts have been agreed for the plants.

Mr Philippe Varin CEO of Corus on the sidelines of the IISI conference in Berlin told Reuters that electricity supply contracts were currently underway for the plants in both countries. He said "When these contracts are in place our goal is to find a strategic future for this business, the primary aluminum production, in an environment which is more supportive of the aluminum business outside of Corus.”

The smelters in Delfzijl in the Netherlands and Voerde in Germany have combined capacity to produce around 250,000 tonnes of primary aluminum annually and, including secondary production from scrap, have total output of more than 300,000 tonnes of aluminum a year.

voestalpine likely to win order for North Stream project- report

Austrian Oberoesterreichische Nachrichten reported that voestalpine AG is close to securing a contract possibly worth EUR 160 million to provide about 200,000 tonnes of plates needed for the North Stream pipeline.

As per report, LOI has been issued and the conclusion of the contract for the project is likely to take place by November 2007.

AISI updates analysis on indirect steel trade with 2006 data

American Iron and Steel Institute has updated its analysis of US indirect steel trade to include 2006 thus expanding the earlier analysis for years 1999-2005. This report identifies the volume and value of steel incorporated in finished products in eight major consumer markets imported and exported between the United States and 11 major countries and four regions.

The AISI report shows that US indirect steel imports hit a new high of 39.8 million net tons in 2006 up by 8% from 2005 and up by 22% since 2000. US indirect exports of steel also reached a new high of 20.6 million net ton in 2006 a 2% gain from 2005 and up 15% from 2000. Since indirect import gains outpaced the rise in indirect exports, the indirect steel trade deficit worsened in 2006 to 19.2 million net ton. This is 15% greater than 2005 and only 4% below the record year of 2002.

For the automotive sector, which remains the single largest source of indirect steel imports, the indirect steel trade deficit grew to 9.5 million net tons in 2006, after being relatively stable in 2003-2005. However, while the indirect steel trade deficit for this sector rose modestly from the 2003-2005 sector average of 8.7 million net ton, which was 22% below the sector deficit in 2002, the indirect steel trade deficit in 2006 remained well short of the sector’s record deficits in 2001-2002. This decline reflects in part the increasing automotive production in the United States, largely by foreign producers such as Toyota, Nissan, Honda and Hyundai, which have significantly expanded the scope and scale of their US operations, which rely mainly on domestically produced steel.

While the automotive sector’s indirect steel deficit since 2002 is one positive development, the significant overall deficit in America’s indirect steel trade highlights continuing structural problems for US manufacturing. Of particular concern to domestic steel maker is the fact that US indirect steel imports from China last year of 6.1 million net ton increased by 20% from the level in 2005. Moreover, our 5.5 million net ton indirect steel trade deficit with China in 2006 was the largest deficit with any country and was 3.9 million net ton greater than in 1999.

Mr Andrew G Sharkey III president & CEO of AISI said “China has the world’s most heavily subsidized steel industry and a huge excess of inefficient steel capacity. Its mercantilist model of government subsidies, currency misalignment and export-led growth extends well beyond steel to include downstream producers throughout the Chinese manufacturing base. Because no US manufacturer, regardless of how efficient it is, can compete against the Chinese government, this model of economic development represents a growing threat to the US steel industry, the American manufacturing base and US national security. AISI therefore joins with other US industries in urging the adoption of a pro-manufacturing US policy that has at its core more effective laws against unfair trade. The place to start is with passage into law this year of strong China trade legislation.”

AISI has been publishing data on U.S. indirect steel trade by world areas and steel consuming markets expressed in tons of steel since 1984. These reports provide data on the total amount of indirect steel trade each year in the US economy, and show the main sources of foreign competition faced by major steel using industries in the United States. This latest report includes detailed data for the last seven years (2000-2006). To obtain the full report, please visit www.steel.org.

Nucor counsel applauds US ITC decisions on HR sunset reviews

Mr Alan H Price counsel to Nucor Corporation has applauded determinations of the US International Trade Commission in the sunset review of the antidumping and countervailing duty orders covering imports of hot rolled steel into US.

Mr Price said "The ITC correctly recognized that imports of hot-rolled sheet from China, India, Indonesia, Taiwan, Thailand and Ukraine would injure the domestic industry if the orders were removed. China has a staggering amount of excess capacity, while the other countries depend on exports to maintain production. Maintaining these orders is critical to the domestic steel industry and we are pleased that the ITC has recognized the importance of these orders."

US ITC made negative determinations with regard to Argentina, Kazakhstan, Romania and South Africa. Mr. Price added that "Although we are disappointed with these determinations, on balance we are pleased with the result.”

AIC Ventures acquires 2 facilities of SET Enterprises

AIC Ventures announced today that it has completed a sale leaseback transaction with SET Enterprises. The transaction includes two SET facilities located at New Boston in Michigan and North Vernon in Indiana.

AIC Venture, a real estate fund, NL Ventures VI, acquired the property and simultaneously entered into a long term absolute NET lease with SET Enterprises. The assets encompass 371,570 square feet of manufacturing, warehousing and office space.

SET Enterprises is a provider of metal processing services specializing in the production of flat sheet steel blanks for use by major US and foreign automotive makers.

ArcelorMittal signs global network deal with BT

It is reported that ArcelorMittal has signed a GBP 13.9 million global network services agreement with BT covering its wide area network services at 700 sites spread across 40 countries worldwide as a part of it's IT consolidation and standardization strategy, which was put in place after the merger of Arcelor and Mittal Steel towards the end of 2006. BT already manages Arcelor’s international backbone and network.

The contract gives BT first and last refusal for any additional sites to be added to the network. It also paves the way for BT and ArcelorMittal to work together to deliver other forms of networked IT, such as VoIP and local area network services.

Under the deal, BT will install a highly resilient IP network to connect ArcelorMittal’s sites across the world. The network should be a key enabler for the firm's global IT plan to optimize its production capability by moving work orders more efficiently around the world. It is also being touted as enabling global shared services for functions like HR.

Mr Patrick Vandenberghe group CIO of ArcelorMittal said that BT was trusted to go the extra mile to make best use of our existing infrastructure.”

RBCT coal lines to reopen on Thursday

Reuters reported that the two rail lines to South Africa's Richards Bay Coal Terminal closed by a derailment would reopen on Thursday, earlier than initially thought.

As per report, around 50 trains have been cancelled as a result of the derailment, which forced the closure of both lines to RBCT. It was first thought at least double that number of trains would be cancelled, incurring a loss of up to 800,000 tonnes but both rail lines will resume operations two days earlier than originally projected.

This equates to a loss of 320,000 tonnes. The eventual total loss will be a little higher than that as the system is brought back into balance with full and empty trains spread evenly throughout it.

The lost tonnage will push stocks at RBCT lower but would have a negligible impact on vessel loading. However, industry sources said, another loss of a similar size before the end of the year could affect loading.

Nucor to invest in EAF dust recycling plant in Arkansas

It is reported that Nucor Corp and the Heritage Group will invest USD 29 million to create a PIZO Operating Co to process a waste byproduct from two Nucor plants near the Mississippi River. The PIZO facility will be near the Nucor Yamato Facility at Blytheville in Arkansas. A groundbreaking will be held in early 2008 and the plant is expected to be complete and operational by the end of next year.

It will process 50,000 tonnes of electric arc furnace dust from the Nucor Hickman and Nucor Yamato steel plants and convert it into products used largely by the metals industry.

The technology used at the facility was developed by Indiana based Heritage Environmental Services a member of the Heritage Group,

Mr Mike Beebe governor of Arkansas said "This investment by Nucor and The Heritage Group is good news on two fronts. The creation of PIZO means more high quality jobs for northeast Arkansas, and also production of usable materials from waste, helping us better utilize our resources. This is a great example of employing environmentally friendly ideas as an engine for economic development.”

Mr Nigel Morrison president of PIZO said "We are delighted to announce that the first PIZO facility will be built in Blytheville Arkansas. This venture has been made possible due to an excellent joint effort between Heritage, Nucor, State and local officials.”

PIZO operated a demonstration plant at a foundry in South Bend, Ind., last year. Nucor holds the rights to PIZO technology in North America.

Hadeed SABIC starts producing colored coil products

It is reported that a new line in the metals coating mill in the complex of the mills of the Saudi Iron and Steel Company in the industrial al Jubail City had started commissioning by the end of the second quarter of this year.

Mr Mohammad Saleh Al Jabr executive VP of Saudi Basic Industries Corporation said that "The commercial production of the new line of coils is expected to start before the end of 2007. Setting up this mill is within the strategic plans of SABIC for the development and growth of the iron and steel industry in Saudi Arabia."

The production capacity of the mill is estimated by 120.000 tonnes per year of high quality steel flat and colored products according to the requirements of the market. The mill will produce coils in thickness between 0.2mm to 1.6mm in widths between 500mm to 1400mm.

Taiwanese Walsin to buy 59.76% stake in SS unit in China

It is reported that Walsin Lihwa Corp has decided to invest USD 56.84 million in acquiring a 59.76% stake in a stainless steel venture in Jiangyin city of China's Jiangsu province on the Yangtze River.

Walsin Lihwa Corp said that the investment plan is a revision of what was announced in March, which was to acquire a 51% stake for USD 48.27 million.

It said it is injecting a further USD 21.45 million into another wholly owned steel venture in Changzhou also in Jiangsu province, raising its cumulative investment in the unit to USD 58.24 million.

Given Taiwan's restrictions over direct China bound investments, Walsin Lihwa is going through its overseas units to make the investment in both projects.

TISCO produces SS CR in 1,500mm and 2,000mm width

YIEH reported that China’s Taiyuan Iron & Steel Group has produced 1,500mm and 2,000mm width stainless steel cold rolled coil successfully.

The output of 1,500mm cold rolled production is estimated to reach 200,000 tons per year and 300,000 tons per year for 2,000mm width. TISCO is also planning to add a new 1,500mm width stainless steel cold rolled line.

It is expected that the total production output will hit 1.5 million tonnes, once those new facilities have been commissioned in the end of this year.

Rio Tinto offer for Alcan gets Australian FIBR approval

Rio Tinto announced that it has received approval from the Australian Foreign Investment Review Board for its proposed acquisition of Alcan Inc by a subsidiary of Rio Tinto.

Rio Tinto said that receipt of the Australian Foreign Investment Review Board's approval and other regulatory clearances, is a condition to Rio Tinto's offer to acquire the outstanding shares in Alcan Inc.