Essar to set up 2 million tonne steel plant in Bangladesh

ET reported that the Ruias promoted Essar Group has decided to set up a 2 million tonne gas fired steel plant in Bangladesh, through a collaboration with four local partners. The plant, estimated to cost about INR 8,000 crore, will make hot rolled steel, a base grade steel category that can be value added into higher grade products. The Ruias will invest USD 550 million for 60% of the equity.

When contacted, an Essar spokesperson told ET that “We keep evaluating investments in various projects and would not like to comment upon a specific project. Interestingly, the Ruias plan for a steel plant in Bangladesh, comes even as the TATAs’ plan for a similar steel project has been delayed due to political hurdles.”

Sources said that Essar Bangladesh is scheduled to come up in the port city of Chittagong and is likely to start commercial production by 2010. Essar has signed a MoU with local players like the S Alam Group, PHP, KDS and Abul Khair. However, the final agreement is yet to be signed. The proposed steel plant is expected to get approval from Bangladesh’s investment board as the consortium may not seek tax and other special incentives that other investors had sought earlier.

An industry source said that “Essar project may get Bangladesh’s government approval because of the local partners there. They may also not have problems in sourcing gas.”

TATA sets up JV with MMTC for mining in Africa

FE cited Mr Jairam Ramesh minister of State for Commerce as saying that state run export house MMTC will enter into JV with TATA Steel to bid for mining projects in Africa.

Mr Ramesh said “MMTC will hold 26% stake in the proposed JV while the 74% will be held by TATA Steel. The JV will jointly bid for mining projects in the Africa’s and explore opportunities in diamond, gold, iron ore and coal mining.”

Mr Ramesh who has just returned from a four day trip to Angola said “the Angolan government has offered us opportunities in gold and diamond mining in their country. He said TATA Steel’s board has approved the JV while the MMTC board has given an in principle nod the formalities of the JV will be tied up soon.”

Mr Ramesh said India is the largest consumer and importer of gold and diamonds. Both these imports amount to USD 10 billion each. He added that such exploration activities will be beneficial for the Indian market that has a huge appetite for gold and diamonds.

MMTC’s precious metals business stood at INR 13,300 crore in 2006/07 and expected to go up to INR 17,000 crore in 2007/08.

CIL BCCL to seek higher coking coal price from SAIL

IANS reported that Bharat Coking Coal Ltd a subsidiary of Coal India Ltd will ask for a 40% hike in coking coal prices supplied to Steel Authority of India Ltd from 2008/09.

Mr A.K Paul chairman & MD of BCCL said that “Keeping in mind the coking coal price increase in the international market, we have decided to seek a price of INR 6,300 per tonne from SAIL. At present we are selling coking coal to SAIL at a price of INR 4,500 per tonne.”

Mr Paul said “We have already got offers from Rashtriya Ispat Nigam Ltd and Durgapur Project Ltd, a domestic steel and mining machinery manufacturing company in West Bengal, who have agreed to buy coking coal from us at a price of INR.6,300 per tonne.”

He said that “The old agreement with SAIL expired on March 31st 2008. Now we will demand a higher price from them. If they agree with the increased amount, we would go into a further contract. Otherwise we will supply coking coal to RINL and DPL at the new price. He added that BCCL was in talks with both the domestic steel players.”

Mr Paul said “We are presently supplying 40,000 tonnes of coking coal to RINL on a temporary basis.”

BCCL has set a target to produce 4.38 million tonnes of raw coking coal in 2008-09 of which 2.2 million tonnes would be washed coal production

JSW hikes raw material surcharge, others likely to follow suit

ET reported that the rift between the Indian government and steelmakers on the price of the commodity could widen further following private sector players such as JSW Steel and others effecting INR 5,000 per tonne raw material surchage on HR coils. The move could push up inflation which touched the 7% mark last week a 59 week high.

Though only JSW Steel has announced a hike so far, industry sources told the media that all private sector players have imposed the surcharge with effect from Wednesday. The sources said "Yes, all of them have increased."

Mr Seshagiri Rao director of JSW Steel was the most forthcoming of the lot, admitting to the INR 5,000 surcharge hike. This was done to offset the increase in raw material prices, particularly coal. He added that "We import our entire coal requirement. The contract price for coal has gone up by USD 200 per tonne from USD 96 last year. We have no option but to increase the price. He added that the price of coal is as high as USD 400 per tonne in the spot market.”

Railway workshop rolls out SS wagon prototype

It is reported that the Golden Rock Railway Workshop has developed a prototype of stainless wagon, which will go into production this fiscal. The prototype, developed in three weeks, is based on the design provided by the Lucknow based Research Designs and Standards Organization which comes under the Railway Ministry.

After certification by the RDSO, the workshop will start making the wagons in a couple of months. During this fiscal, the workshop is planning to turn out around 150 wagons, which will have a payload of 71 tonnes each, three tonnes more than the conventional wagon’s capacity. Furthermore, the stainless steel wagons will be non corrosive, sturdier and stronger, besides being slightly longer in length, width and height than the conventional wagons. These wagons with polyurethane painting will be supplied solely for the Railways.

Besides the Golden Rock workshop, the Jamalpur, Samastipur and Amritsar workshops will roll out these wagons.

CIL seeks permission to return used land

It is reported that Coal India Ltd has approached the Centre seeking amendment in the Coal Bearing Areas Act, 1957 to help the company return the used land to the society for other usage.

According to a quick estimate, the existing provisions of the act had forced Coal India to unwillingly possess approximately 30,000 hectare of land, which is no longer required for the company’s mining activities.

Mr Partha S Bhattacharyya Chairman of Coal India Limited said “We have in our possession approximately 0.15 million hectares of land. We guess roughly 20% of the same is already used and is no longer required by CIL. However, the Act does come in the way of releasing the land back to the society for other usage.”

While preliminary discussions are already held with the Centre underlining the need for amendment of the Act, the company appointed a committee last week to asses the quantity of such used land for making a detailed presentation before the Ministry. The report is expected within a month.

The company’s emphasis on handing over used land is understandably linked to the ambitions that the 11th Plan targets for coal production, requiring acquisition of 67,000 acres of fresh land for mining purposes.
Stalling practices

Taking a queue from delay in embarking on number of new projects due to land acquisition delays and the increasing controversies concerning land acquisition, Coal India has been actively campaigning for socially sustainable mining practices underlining the need for wider contribution in rehabilitation and re-settlement of the communities affected due to mining industry.

A proposal has already been submitted before the Coal Ministry underling the need for greater contribution towards lives of people in the mining areas other than the existing practice of offering job to a handful of landowners.

Mr Bhattacharyya said “Once the legal hurdles are removed, a mechanism should be created to encourage re use of land for the benefit of society.”

BHEL Trichy posts INR 1,496 crore PBT in FY 2008

BS reported that Bharat Heavy Electricals Limited Tiruchirappalli unit's profit before tax up by 161% YoY to INR 1,496 crore in 2007/08 from INR 872 crore in 2006/07.

Bharat Heavy Electricals Limited said the Trichy unit's turnover increased by 21% YoY to INR 5,606 crore during 2007/08 compared to INR 4,606 crore in 2006/07. During the year, the order book increased by 24% YoY to INR 10,200 crore from INR 8,217 crore a year earlier. It also bagged fresh orders from overseas customers. The year ended with highest ever outstanding orders of INR 17,400 crore.

Gearing up to meet the nation’s power needs in the XIth Five Year Plan and thereafter, BHEL is pursuing implementation of capacity augmentation schemes. It will invest INR 732 crore under Phase II plans to increase manufacturing capacity from the present 10,000 MW to 15,000 MW by March 2009. This follows the first phase of expansion which was completed on schedule by December 2007 at an investment of INR 190 crore.

BHEL Trichy in 2007/08 also entered the super critical league by bagging orders to supply two super critical boilers of 660 MW capacities from NTPC for Barh Stage II. The company also entered into MoU with the Tamil Nadu Electricity Board for the first 2x800 MW supercritical thermal power project coming up in Tamil Nadu.

Essar Steel submits 3.3 million carbon credits project for CDM registration

It is reported that Essar Steel Limited has submitted its 340 MW Gas based combined cycle power project expansion at Hazira for CDM registration. The project hopes to generate a total of 3.33 million CERs over the 10 year crediting period.

The proposed project activity is the Phase-II 340 MW capacity gas fired CCGT. ESTL is setting up this project through a special purpose vehicle Bhander Power Ltd and has obtained the necessary approvals from the regulatory authorities to this effect. The project activity receives Natural Gas in pipelines from ESTL and water is pumped from the Tapi River. BPL and ESTL have entered into a Power Purchase Agreement. The Phase I of the project is being developed as a CDM project.

Project emissions due to CO2 emissions from on site combustion of natural gas is about 10,54,17 tonnes CO2e while the baseline emissions are 1,458,188 tonnes CO2e per year. Leakage emissions due to fossil fuel combustion / electricity consumption associated with the liquefaction, transportation, re gasification and compression of LNG into a natural gas transmission or distribution system is about 70,196 tonnes CO2e per year. The net as per calculations is 333,875 tonnes CO2e per year.

ADB postpones funding

The Daily Star news reported that Asian Development Bank decided to put financing of the Phulbari Coalmine Project on hold and expressed its unwillingness to talk to British company GCM Resources in this regard.

BBC Bengali Service reported protesters of the Phulbari Coalmine Project say other investors should follow suit and not invest in the project.

The ADB was considering giving GCM Resources, popularly known as Asia Energy, a loan of USD 100 million and another USD 200 million for political risk guaranty. ADB is now saying that it is not interested in holding talks with the British company about financing the project.

ADB officials in Dhaka also said the plan to finance the Phulbari Coalmine Project is now on hold.

Mr Anu Mohammad general secretary of National Committee to Protect Oil, Gas, Mineral Resources Electricity and Port said "The project is a destructive one. There is no instance of open pit mining at a place where the density of people is so high. He said we hope other funding agencies will also follow the way of ADB so that Asia Energy has to leave the country cancelling the project. Now the government should develop its own institution which would extract coal in a suitable way for the country and internal demands would be priority one."

Chennai port handles 57 million tonnes cargo in 2007/08

It is reported that the Chennai port handled an all time high of 57.15 million tonnes of cargo during 2007/08, surpassing the Shipping Ministry’s target of 55.86 million tonnes and registering a 7% increase over the previous year’s handling of 53.41 million tonnes.

Mr K Suresh chairman of Chennai Port Trust said “It was a record performance despite the inclement weather that affected port operations for a few days last year. For 2008/09, the target is 62 million tonnes. Of the total throughput, export was 24.31 million tonnes and import was 32.84 million tonnes.”

Mr Suresh said container traffic in 2007/08 at Chennai Container Terminal operated by Dubai Ports reached an all time high of 1.12 million TEUs, an increase of 27.41% over the previous year. Next year, the terminal will achieve its full capacity, a year ahead of time. He said that the port retained the position as the premier car exporting port recording an all time high performance of handling 1.37 lakh cars in 2007 08 up by 20% increase over last year. It is likely to handle around five lakh cars in the next two to three years with various manufacturers, including Hyundai, increasing their exports.

Mr Suresh said the provisional net surplus after tax for 2007/08 was INR 257 crore on operating income of INR 675 crore. He said ChPT will soon call for ‘request for qualification’ proposals from private operators for the Chennai mega terminal planned at a cost of INR 3,105 crore to come up in the outer harbour. He added that the technical feasibility and financial viability reports are ready for the terminal, which can handle five million TEUs a year.

Mr Suresh said the ChPT will go in for viability gap funding from the government’s infrastructure fund or forego revenue share and include the tariff in the vessel related charges. This will make the project more attractive for private operators. He said it will take 3 to 4 years for the project to start, and by then, the two private container terminals will together handle around two million TEUs. As per the concession agreement signed with PSA-Sical, till the second container terminal handles one million TEU or completes four years of operations, whichever is earlier, a competitive facility shall not come up at the port.

Mr Suresh said the mega terminal will have two new breakwaters with a total length of around 4 kilometer; continuous quay length of 18 meters alongside depth and basin area of 300 hectares and back up area of 100 hectares. The terminal can handle ultra large container ships of over 15,000 TEUs. He said the second private container terminal will commence operations in April 2009. The terminal will have an annual handling capacity of 1 million TEUs. The project cost is INR 495 crore and the revenue share offered 45.801%.

Garware Offshore to buy 5 new vessels

Reuter reported that shipping services firm Garware Offshore Services Ltd plans to buy three anchor handling tugs cum supply vessels for USD 13 million to USD 15 million each

The official, who did not want to be identified, said "We have already contracted to buy three vessels. It can earn us USD 10,000 to USD 11,000 per day. He said 2 of the three vessels used for towing and handling the anchors of offshore construction vessels are scheduled to be delivered in June and August, while the third one would be delivered in February next year.”

He further added that "It was almost 23 to 24 years old. Also, today it's more a sellers' market so it is better to sell old ships now."

The official said the company is expected to post a profit of INR 250 million to INR 300 million on revenue of INR 1.05 billion to INR 1.1 billion in the fifteen month period ending March 2008. He added that "We are expecting our topline to double in 2009 because of the vessels being added. Also, higher oil prices would mean more exploration and production opportunities for us."

Suzlon energy ink with Horizon Wind

Suzlon Energy Ltd has informed BSE that Suzlon Wind Energy Corporation, the USA, the step down subsidiary of Suzlon Energy Ltd has signed a repeat order with Horizon Wind for 200 MW of wind turbine capacity.

The original contract calls for delivery of 400 MW of turbine capacity in 2008 and 2009 and now has been expanded to include an additional 200 MW in 2009.

The capacity will be supplied in Suzlon's S88 2.1 MW wind turbine and will be delivered to various ready to build sites across the United States. The turbine agreement includes the supply of 95 units of the S88 2.1 MW in 2008 and 190 units in 2009.

Foundation of second steel processing unit in Bihar

Bihar Times reported that the foundation stone of the INR 266 crore hi tech Steel Processing Unit of the Steel Authority of Indian was laid by the Mr Ram Vilas Paswan Union minister of Steel, Fertilizer and Chemicals at Afzalpur village under Mahnar block of Vaishali district on Tuesday. The foundation was laid amidst chanting of Vedic hymns.

Mr Paswan while speaking on the occasion said that SPU would usher in prosperity in the years to come. He reiterated that development was on the top of his political agenda.

The report added that it is second SPU of which Mr Paswan had laid the foundation stone in the state in the recent past. A couple of months back a similar unit was set up in the outskirt of Bettiah in West Champaran district.

Mr Pawar to present Rajiv Gandhi National Quality Awards 2007

It is reported that five companies have been selected for the 14th Rajiv Gandhi National Quality Awards, for the year 2007. The honour is scheduled to take place on April 10 with the presence of Mr Sharad Pawar Minister of Agriculture, Consumer Affairs, Food and Public Distribution.

The award was instituted in 1991 with the name of India’s visionary Mr Rajiv Gandhi late PM of India to promote and encourage Indian manufacturing and service sector with special emphasis on quality program in international market. This recognizes organization leading the quality movement in India with an aim to meet optimum consumer satisfaction and at the same time increasing competitiveness of indigenous product in global market.

The Bureau of Indian Standards involved in the development of standardization, marking and quality certification, takes the credit of presenting the award since its inception. It also sets guidelines and criteria that can be used to evaluate quality improvement program of different companies.

This time apart from five national awards which includes two large scale, two small scale industries and one best of all awards, sixteen other organizations have also been selected for commendation certificates under various categories.

Mr Sukhbir Singh takes over as member electrical, railway board

It is reported that Mr Shri Sukhbir Singh took over as the member electrical, ministry of Railways, Railway Board, New Delhi and ex officio secretary to the government of India with effect from April 8th 2008. Prior to his present assignment, he was general manager, North Eastern Railway from July 31st 2006.

Mr Sukhbir an officer of 1971 batch of the Indian Railway Service of Electrical Engineering worked in various capacities in Indian Railways. He worked as general manager, Chittaranjan Locomotive Works, chief electrical engineer western railway, divisional railway manager Allahabad, chief electrical engineer (Loco) central railway, chief electrical engineer western railway Mumbai, additional divisional railway manager central railway, Nagpur and additional divisional railway manager, Mumbai.

JK Tyres to invest INR 480 crore for capacity expansion

PTI reported that JK Tyres plans to invest INR 480 crore in 2008 to increase capacities of both its truck and passenger radial tyres.

Mr Arun Bajoria president of JK Tyres said that "We plan to invest INR 480 crore to increase our capacity of radial tyres. He said of the INR 480 crore investments planned for this year, INR 315 crore would be spent on augmenting its truck radial tyre capacity to 8 lakh tyres from the existing 3.67 lakh tyres and another INR 120 crore on increasing the off the road tyre capacity. He added that the company also plans to invest the remaining in power plant and other projects.

Mr Arun Bajoria said that "A part of this enhanced capacity in the OTR sector will be dedicated to Bharat Earth Movers Ltd, which supplies bumpers to Coal India. He said investment worth about INR 225 crore has already been pumped in between 2005/07 to ramp up the company's truck radial tyre capacity by 50%. He added that the company's radial tyres too have been hiked by 30%."

He also said that truck radialisation was on an upswing in the country and that it would soon touch the 11% to 12% levels. He added that the company also has plans to invest another INR 700 crore for capacity expansions by 2011.

ArcelorMittal completed acquisition of mining interests in Russia

ArcelorMittal confirms it has completed its previously announced acquisition of three coal mines and associated assets in Russia for total consideration of USD 718 million.

The Company has acquired a 97.9% stake in the Berezovskaya Mine together with a 99.46% stake in the Pervomayskaya Mine from Severstal. Both mines produce coking coal and are located in the Kemerovo Region.

As part of this agreement ArcelorMittal has acquired the exploration and mining rights to the Zhernovskaya 3 coal deposit, which is a subsidiary of the Pervomayskaya Mine.

As previously announced, the company has also acquired the Severnaya Coal Preparation Plant which is part of the Berezovskaya Mine and three companies that provide the mines with associated services. Additionally the Company has completed its acquisition of 100% of the Anzherskoye mine in the Kemerovo Region.

Annual production from the three operating mines which have a combined estimated total reserve of more than 140 million tons was 3.14 million tons RoM in 2007. The Zhernovskaya 3 coal deposit has an additional estimated reserve of 46 million tons.

LME announces third consecutive year of record volumes

The London Metal Exchange has announced its annual volume figures for 2007, revealing a third record year for the Exchange. Nearly 93 million lots were traded, across Futures and Options, representing an increase of around 7% on 2006 figures.

Four contracts saw volume growth of more than 10% on 2006 figures:

The Primary Aluminium contract saw Futures growth of over 10%, taking the total traded to over 40 million lots; the Copper Grade A contract grew 13.6% to 21.4 million lots; the NASAAC contract grew over 19% to 1.2 million lots and the Aluminium Alloy contract grew almost 11% to around 0.5 million lots.

Mr Martin Abbott CEO of LME said that “These results clearly demonstrate another excellent year for the LME, its high levels of liquidity and the continued confidence and credibility of its services. Our current and expanding portfolio of service offerings, led by the launch of the steel billet contracts in February, means that we are on track to meet our target to double volumes in the next five years.”

AISI rolls out new online bar steel machinability estimator

The American Iron and Steel Institute introduced the new Bar Steel Machinability Estimator, a tool for automotive engineers to complete calculations on the machining productivity of carbon and alloy steels in carbide tooling applications. The machining productivities of different steel grades can be compared and used in designing parts to lower overall manufacturing costs.

The new Machinability Estimator is an online tool developed from 10 years of automotive steel data using the most up to date machining methodology, steels and technology. Design, materials and manufacturing engineers can estimate the machining productivity of carbon and alloy steels prior to production for maximum manufacturing impact.

Mr David Anderson director, Long Products Market Development Group AISI said that "Machining costs are 20% to 70% of the overall value of automotive parts. The Bar Steel Machinability Estimator offers OEMs and suppliers the ability to select optimal process parameters, which can assist in designing cost- effective parts."

Users can input a steel composition and receive a relative machinability number or an estimated cutting speed for 30 minutes of tool life in surface feet per minute.

The Machinability Estimator builds on the Bar Steel Machinability Database, which is a detailed record of automotive bar steel machinability under single point carbide turning conditions. It was developed from several years of controlled testing at eight different steel and automotive companies. Machinability tests were conducted on more than 30 significant industrial carbon, alloy, resulfurized and microalloyed steel grades using carbide tools in a standardized single point turning test.

Mr Roger Joseph, project manager, Machinability Estimator and Machinability Database said that "The Machinability Estimator is the most progressive online resource available for machining productivity. This online resource moves technology and information forward for today's automotive industry. Tests are currently underway using coated carbide tools, and those test results will be incorporated into the Machinability Estimator upon completion."

Through the support of the American Iron and Steel Institute, the Long Products Market Development Group is growing the market for value added steel bar and rod products. With seven member companies and two task forces Automotive/Heavy Equipment and Construction/Infrastructure the group is committed to developing innovative solutions to the challenges facing their clients and the steel industry.

Coking coal price surge proof BHP and Rio tie up bad - EUROFER

According to European association of steel producers, the massive price increase in coking coal key to the process of making steel provides further evidence that a merger between mining titans BHP Billiton Ltd and Rio Tinto PLC is bad for competition in the mining industry.

Japan's three biggest steel makers Nippon Steel Corp, JFE Holdings Inc's JFE Steel unit and Sumitomo Metal Industries Ltd all agreed to accept Australian miner BHP's offer to supply coking coal at USD 300 a tonne for the fiscal 2008, up from USD 98 previously.

Mr Gordon Moffat director general of EUROFER in a statement said that "This further massive rise in costs brings into perspective the crucial issue of raw material supply as a key factor in the competitiveness of European industry and provides further evidence if more were needed of the inappropriateness of the proposed merger between BHP Billiton and Rio Tinto.”

Mr Chavez moves to nationalize Venezuela steel maker

It is reported that Venezuela will nationalize the country's biggest steelmaker Ternium Sidor, controlled by Argentine capital, after talks on a union contract broke down.

The report quoted Mr Ramon Carrizales vice president who held talks with union and company representatives early today, said the nationalization is intended to protect workers’ rights. He said Mr Chavez did not want to let the labor conflict drag on.

Mr Carrizales said that “We made a great effort to search for solutions. There was no will on the company’s part to settle the conflict."

He said one option would be for the government to assume an ownership share of about 60% with the company’s owners keeping a 20% share.

The nationalization of key industries has been a centerpiece of Mr Chavez’s socialist agenda. The government took majority control of telecommunications and electricity companies last year, along with Venezuela’s last remaining privately run oil projects.

Nucor seeks wide flange beams price above USD 1,000 per tonne

According to reports by the Steel Business Briefing and American Metals Market subscription newsletters, Nucor is reported to be increasing the May list prices on merchant bar and rebar by USD 147 per tonne or roughly 20% and on wide flange beams by USD 110 per ton, about 16%. As usual, there has been no corporate pricing announcement but the increase was included in a letter to customers.

Based on previous Nucor claims that the April price for merchant bar is USD 803, the May delivered price will become USD 850. The pricing action will put May rebar (concrete steel reinforcing bar) at USD 900 per tonne up from USD 753 this month while wide flange beams will move to USD 1010 from USD 900.

The Nucor numbers are all somewhat higher than the buyer reports. Purchasingdata.com has reported that the March price average for merchant bar was USD 770, rebar was USD 677 and wide flange beams were USD 858. Some upward movement for April deliveries was being expected by buyers, primarily due to scrap surcharge increases, but the anticipated USD 20 to USD 25 per tonne hikes still would undercut the Nucor list pricing for this month.

Flat prices continue rising in Southern Europe

The price of steel plates rises in Southern Europe. In order to keep stay on a par with the imported price, it is expected that the domestic price will climb higher and that steel mills will further raise the price within the next few days.

Due to strong demand, the imported price has gone up. The price of HR from Italy and India is EUR 700 per tonne; the price of GI is EUR 800 per tonne CFR; the price from Ukraine is also EUR 1,000 per tonne and the price of heavy plates from China is FOB USD 1,070 per tonne FOB and CFR EUR 765 per tonne to EUR 770 per tonne CFR.

(Sourced from YIEH.com)

Firm ferrous scrap price in Tokyo

JMB reported that ferrous scrap market price keeps firm at around JPY 46,500 per tonne for H2 grade at dealers' purchase price including freight around Tokyo.

As per local electric furnace steel makers pay JPY 54,000 to JPY 55,500 and some makers pay as high as JPY 56,500. The price is expected to keep the high level under tight supply.

South Korea export of HRC up in February

South Korea exported 350,000 tons of hot rolled coils in February 2008 up by 89% YoY. The export price on average was at USD 634 per tonne FOB, up by USD 30 per tonne from the same period of last year.

The export quantity was expected to be up in March as well. China was the main export country of raw material for South Korea, and Southwest Asia countries are the main importers of South Korea’s hot rolled coils.

(Sourced from YIEH.com)

Rautaruukki delivered steel structures for new opera house in Oslo

Rautaruukki has delivered most of the steel structures for Oslo’s new Opera House, which is to be opened later this week. The construction project was challenging since the Opera House has been built partly on water and partly on harbour landfill. Rautaruukki delivered the frame, foundation piles and retaining wall structures for the project.

Statsbygg, the Norwegian state’s Directorate of Public Construction and Property, chose Ruukki as the supplier on the grounds of best overall value for money, quality and delivery reliability. The total delivery value was EUR 18 million. The Opera House will be officially opened on April 12th 2008.

Ruukki delivered the retaining wall structures to keep the sea water out of the working area, some 20 metres below sea level. The soil conditions also posed challenges and in some places the steel piles for the foundations extend to a depth of up to 60 metres before reaching the bedrock. The largest piles were 2.5 metres in diameter. Traffic in front of the Opera House is being reorganised and vehicle traffic will drive through a specially-built approximately 1.5 kilometre Bjørvika tunnel, for which Ruukki has also delivered the retaining wall structures.

The steel frame for the Opera House was fire resistant coated and delivery included installation. This impressive building required demanding frame structures. For example, the four inclined columns supporting the roof to the entrance of the building had to be temporarily secured before the permanent roof structure was completed. The roof above the main stage rests on top of a steel structure, this so called steel crown was also delivered by Ruukki. Ruukki also installed the required steel structures required for the stage technology.

Ruukki’s deliveries to the foundation contractors Kynningsrud Fundamentering and Entreprenørservice, as well as to the main contractor, Veidekke, began in 2003. Oslo’s new Opera House is 207 metres long and 110 metres wide and there are 1,811 seats in the auditorium. Total stage height is 54 metres and the stage floor is 16 metres below sea level.

ArcelorMittal Shelby hikes seamless tube price

ArcelorMittal Shelby announced to increase its hot rolled, cold drawn and alloy seamless tubing prices, which will be effective on orders shipped after 1 May.

As per release the company planned to increase hot rolled price by USD 200 per short ton and USD 300 per short ton for cold drawn product. The increase is aimed to cover the increasing raw material, freight and energy costs.

(Sourced from YIEH.com)

American steel prices to raise

Recently, American main steel manufacturers indicated that they will be raising their domestic price in May in order to reflect cost. Among them, AK Steel plans to raise HR coil price to USD 940 per tonne, a rise of USD 130 per ton compared to USD 810 per ton in April.

According to the data, America common steel stock amounts to about 12 million tons and will remain low stock for a short time. As for stainless steel, American stainless steel stock is only 470,000 tons. As America’s domestic market remains weak, steel stock also remains very low. So it remains unsure whether price increases in May will be possible.

(Sourced from YIEH.com)

Teck Cominco upgraded to sector outperform

newratings.com reported that analysts at Haywood Securities upgrade Teck Cominco Ltd from sector perform to sector outperform. The target price has been raised from CAD 48 to CAD 58.

In a research note published, the analysts mention that BHP Billiton and the Japanese steel makers have agreed to a more than 200% hike in coal prices from USD 98 per tonne to USD 300 per tonne for the 2008 coal year.

The analyst said that the substantial hike in coal prices is mainly on account of floods in Australia, which has resulted in many producers declaring force majeure. The coal price per tonne assumption for the 2008 coal year has been raised from USD 175 to USD 285.

Albidon to hike nickel production from Munali

Thomson Financial reported that Albidon Ltd will increase production from its Munali nickel project in Zambia by 20% to about 10,000 to 10,500 tonnes of nickel in concentrate per annum.

Albidon said it estimates capital costs for this upgrade at USD 2.5 million and expects first concentrate to be produced before the end of April, some two months ahead of the original schedule.

Argentina to open bids in USD 650 million railway project

Reuters reported that Argentina will open the bidding for a USD 650 million project to modernize a busy train line this week, in the latest project to upgrade the country's dilapidated railways.

The project is to electrify the San Martin commuter line linking Buenos Aires to its northern suburbs and upgrade signaling and other infrastructure along the 35 mile route, which is currently operated by diesel locomotives.

The Transport Secretariat in a statement said that "The official budget totals USD 650 million, adding that Ms Cristina Fernandez President would launch the bidding process on Thursday.

About 4 million passengers travel every month on the San Martin line, which has been in state hands since 2005, when the operating company was stripped of its contract. In recent months, the center-left government has embarked on several rail projects, including the construction of a high speed link connecting the capital with two other cities and the overhaul of another key commuter line.

Universal Stainless appoints Mr Kornblatt to board of directors

Universal Stainless & Alloy Products, Inc announced that Mr M David Kornblatt has joined the Company's Board of Directors, increasing the number of Company Directors to five. As an independent Director, Mr. Kornblatt will serve on each of the established committees of the Board.

Mr Kornblatt will brings diverse industry and in depth financial experience to his position as a Director of the Company. He currently serves as senior vice president and chief financial officer of Triumph Group, Inc.

Mr Mac McAninch chairman ofUniversal Stainless said that "We are very pleased to add Mr David Kornblatt to our Board. His experience in the aerospace, steel and heavy equipment manufacturing industries combined with his knowledge of international finance fit well with our end markets and growth plans. We look forward to his contribution to the strategy and growth of Universal Stainless & Alloy Products."

Universal Stainless & Alloy Products, Inc headquartered in Bridgeville, Panama, manufactures and markets a broad line of semi finished and finished specialty steels, including stainless steel, tool steel and certain other alloyed steels. The Company's products are sold to rerollers, forgers, service centers, original equipment manufacturers and wire redrawers.

Tronox and Exxaro approve expansion of Tiwest titanium dioxide plant

Diversified resources group Exxaro Resources Limited and United States based Tronox Incorporated have announced that the boards of directors of both companies have given approval for the expansion of their Tiwest joint venture titanium dioxide pigment plant at Kwinana in Western Australia.

With expectations for continued strong demand growth in the Asia Pacific region, the expansion will allow Tiwest to capture future opportunities in this rapidly growing market. The project, which will increase the plant’s current annual capacity from 110 kilo tonnes per annum to around 150 kilo tonnes per annum is expected to cost about AUD 100 million. Tiwest plans to begin construction during 2008, subject to appropriate regulatory approvals. The additional capacity is expected to come on line in early 2010.

The release added that the joint venture partners have signed an agreement under which Exxaro will provide ongoing funding for the expansion. Tronox has the option to contribute its share of the capital at its discretion throughout the project and until a date two years from commissioning, which will be taken into account when calculating its final interest in the expanded production.

The Kwinana plant, with a current annual capacity of 110 kilo tonnes, produces chloride process titanium dioxide pigment using Tronox’s proprietary technology and marketed under the TRONOX® brand.

Mr Sipho Nkosi CEO of Exxaro’s said “The Tiwest development is an important contribution to Exxaro’s strategy of downstream value adding in our mineral sands business.” Together with the South African east coast KZN Sands operation and the soon to be completed acquisition of the Namakwa Sands business on South Africa’s west coast, the combined developments position Exxaro as a major supplier to the titanium and zircon industries.

Mr Tom Adams chairman & CEO of Tronox said “This expansion will provide us with the additional capacity needed to meet the future demands of our existing customers and prospective new customers in the Asia-Pacific region, which is projected to be the world’s largest pigment consuming region in 2008 and beyond.”

The Tiwest Joint Venture is the world's largest integrated titanium minerals production and manufacturing company. Established in 1988, Tiwest operates in Western Australia. Its facilities include the Cooljarloo mineral sands mine, the Chandala synthetic rutile plant and the Kwinana titanium dioxide pigment plant. Tiwest's success has been built on the development of high quality mineral reserves and the application of sophisticated process technology.

Steel costs set to add to Volvo construction equipment prices

Record global demand for commodities has led to sharp increases in the cost base of heavy equipment manufacturers. Consequently, Volvo Construction Equipment will raise the price of its machines and components by 5% globally.

Restricted supply and burgeoning demand for steel, especially in China, has led to the cost of iron ore rising by over 70% on the worldwide markets. This has resulted in a sharp increase in the price of steel and consequently in the production costs of manufacturers of construction equipment. To offset some of the impact of these rises, Volvo Construction Equipment will increase the prices of its machines, attachments and parts by 5%.

Mr Scott Hall executive vice president of Volvo Construction Equipment said that "Manufacturers of heavy construction equipment are being particularly hard hit by the current record prices of commodities, such as steel, oil, iron ore and rubber. With no sign of commodity prices cooling in the foreseeable future it has become unavoidable that these costs be offset in the form of a price increase."

The price increase will be made across Volvo Construction Equipment's entire product range and implemented globally.

Genesis Worldwide Inc continues expansion into European market

Genesis Worldwide Inc an industry leader in green structural building technologies using light gauge steel announced that it has entered into a license and services agreement with Spelera Holdings Limited based in Cyprus.

Spelera is a special purpose entity established for investment in building materials, traditional construction, and real estate development projects in Ukraine. The Agreement initially calls for the construction of a light steel panel manufacturing facility in the industrial city of Dnipropetrovs'k, Ukraine, with the potential for further expansion.

This announcement follows on the heels of similar license and services agreements that were announced in 2007 for Spain and in early 2008 for Russia. For Genesis, this is another step in the successful execution of the Company's planned growth strategy, particularly in Europe.

Under the terms of the Agreement, Spelera will pay Genesis USD 2.2 million from licensing the Genesis technology, the sale of industrial equipment and hardware, and various training and consulting services required for the commissioning of the plant. Spelera will be the exclusive provider of Genesis building systems in Ukraine, and will maintain exclusivity as long as annual minimum gross sales targets are achieved. This Agreement is for a five-year period and will automatically renew for an additional five-year period.

The burgeoning European market is a major element of Genesis' growth strategy, and this new licensee Agreement significantly enhances the Company's presence in Europe. Dnipropetrovs'k, the third largest city in Ukraine, is the centre of the region's steel industry. The plant is scheduled to be completed and operational by the end of 2008, and will begin to meet the growing demand in Ukraine for desirable, architecturally designed homes, constructed with light gauge steel panels.

Eastern Europe and Ukraine in particular, is one of the fastest growing construction markets in the world. Ukraine, which continues to rebuild after the Soviet era, has an energized economy and offers many opportunities for foreign investors. According to the CIA World Fact Book website, as of July 2007, the population of Ukraine was 46,299,862, with a GDP growth rate of almost 7%. The Construction Ukraine website states that "Cottages/single-family houses became the most popular sector of housing in Ukraine and the Institute for Economic Research and Policy Consulting recognizes in their macroeconomic forecast that Ukraine construction will continue to increase due to investment activity as well as a high demand for residential construction.

Mr Mag Mostafa vice president of Business Development of Genesis said that “We recognize that there is an increasingly affluent middleclass in Ukraine and a need for improved housing to suit consumer needs. We researched and provided in depth analysis of the local Ukraine construction market in order to help Spelera recognize the potential within the marketplace." As part of the project, Genesis completed a competitive analysis, as well as a complete analysis from an engineering and marketing perspective.”

PSM raises product rates again

Dawn reported that Pakistan Steel made a fresh increase in the prices of its products, including billets, bloom, galvanised steel and hot and cold rolled, on Wednesday.

As per report it made an increase by PKR1,000 for billets and bloom, PKR 3,500 per tonne for hot and cold rolled products and PKR 3,500 to PKR 4,500 per tonne for galvanised products depending on their size.

On March 7, it had increased the rate of billets of all sizes by PKR 2,500 per tonne, followed by an increase in hot and cold rolled products by PKR 5,000 to PKR 7,500 per tonne and PKR 2,000 per tonne in galvanised products.

The Pakistan Steel attributed the recent increase to a substantial increase in basic raw material prices, like iron ore, coke, coal and other inputs. The mills raised its prices by 65% between January 2007 and April 9th 2008, due to an increase in the rate of basic raw material in the world markets.

The price of iron ore has surged from USD 60 to USD 150 per tonne in the last one year, followed by met coke price to USD 550 from USD 160 per tonne in the same period. Meanwhile, the coal price, which was USD 98 per tonne before March 31st 2008, is now being quoted at USD 30 per ton.

A Pakistan Steel spokesman said that any large gap in prices between PS and international level would reduce imports, thereby increasing the already existing demand and supply gap. Hence it had become essential for the PS to review its prices periodically so that normal supplies to the markets are not disturbed. The PS had not reviewed prices of hot and cold-rolled products despite pressure of price-hike in the global market.

Sabic eyes iron ore acquisitions

Reuter reported that Saudi Basic Industries Corp is considering investments in iron ore mines overseas to reduce the impact of rising prices on its steel production unit.

Mr Mohamed al Mady CEO of Sabic said that demand for steel in Saudi Arabia has been outpacing supply and competitors of Hadeed, the steel producer that Sabic controls, have been raising prices.

London based MEED citing a source close to the company said that Sabic, the Gulf's largest steel maker, is looking at possible investments in iron ore mining. But it gave no further details.

Hadeed can produce as much as 5.5 million tonnes per year of steel.

Mr Mutlaq Al Morished CFO of Sabic could not immediately be reached for comment. But in November last year Mr Morished said that Sabic will almost triple steel output by 2020, but was not seeking steel acquisitions beyond its home region.

Sabic's sources of iron ore include Turkey and Ukraine.

Air Liquide to boost Middle East investment to USD 1 billion

Bloomberg news service reported that Air Liquide SA plans to boost its Middle East investment from USD 200 million to USD 1 billion over the next five years.

Mr Benoit Potier CEO at the opening of the French industrial gases distributor’s regional office in Dubai said that “This region will be very important. Energy is cheap and feedstock is available.”

Mr Potier seeking to reduce their dependence on oil and gas export revenues, countries in the Persian Gulf are widening their portfolios to include petrochemical, steel and aluminum plants. According to the news service Air Liquide is in talks with Saudi Aramco, the world's largest oil company and petrochemical and steel companies in Saudi Arabia.

He added that “Within 12 months, we'll have a few contracts signed. The growth in the world today is coming from China, India and the Middle East. This will represent a major portion of our growth.”

Air Liquide also plans to spend roughly USD 15.7 billion on acquisitions and new factories to keep pace with surging demand in the health, oil refining and electronics industries.

Insiders deny black market steel trading

Emirates Business reported that the head of a leading building materials company has denied there is a shortage of steel and the existence of a black market in the metal, despite the recent rise in prices.

Mr Rizwan Sajan chairman of UAE based Danube Building Materials, told Emirates Business that “There is still no shortage in the steel market but you have to pay the high prices.” He added that “There is also no black market because availability is plentiful. Whatever quantity you want is available, it’s just that the price has become inflated. But in the case of the cement sector, even if you want to pay the price, supplies are not available. So then the black market comes into the picture.”

Mr Sajan said that the price of steel has climbed by about 40% since the beginning of 2008 from AED 3,000 per tonne to AED 4,000. The current price is a 60% increase on last year’s average price of AED 2,500.

Figures from Dubai Chamber of Commerce and Industry show that the price of steel has increased almost 14 times in five years. Mr Sajan. Said that “Steel suppliers have taken big losses because a lot of us agreed contracts at AED 3,000 and now it is trading at AED 4,000. But whatever I have lost on a particular contract I can make up in others contracts. Prices usually remain valid for three to six months.”

But some industry figures say those purchasing steel are facing problems including a burgeoning black market in the commodity, as previously reported.

One trader said that “Many suppliers won’t sell if you are asking for less than 300 tonnes and some have much higher minimum for orders. So if you are a small contractor you are facing problems.”

And another source, who asked to remain anonymous, said there was a worldwide shortage. He added that “The steel industry must now strike a fine balance between short-term profitability and long-term sustainability. Global and regional demand has risen to such an extent that the steel shortage is now delaying construction.”

IPIC buys 2% stake in EDP

Reuters reported that Abu Dhabi's government owned energy investment company IPIC had acquired a 2% stake in Energia De Portugal.

IPIC in a statement said that the acquisition forms part of IPIC's diversification plans and marks the entry of IPIC into the utility sector.

EDP is a leading utility in the Iberian peninsula with 10.5 million customers and 15,894 MW of installed capacity.

AHMSA gears up to reopen King Solomon’s mines

It is reported that Leading Mexican steel and mining company AHMSA is looking forward to reviving mining on the site of the world’s oldest known copper mines located in the Arava Valley, part of Israel’s southernmost Eilot district. Having completed a feasibility study and pilot test of its plant and refining process, AHMSA Israel’s Arava Mines expects to reopen the Arava copper mine later this year and then move on and start producing copper cathodes for both export and domestic consumption.

As per report though the link to King Solomon and the 10th century BCE is a tenuous one, the copper mines and ore deposits at the Arava Mines’ site are generally acknowledged to be the oldest in the world, having been reliably dated back to ancient Egyptian times. The Egyptians had extensive mining and smelting operations and settlements there nearly 8,000 years ago.

In addition to the site’s historical and cultural significance, the environmental aspects and implications of the project are also of particular concern the mines are adjacent to the Timna Park Reserve, a national park frequented by holiday goers and tourists known for its scenic red rock desert geography, geology and ecosystem.

AHMSA’s plans to invest some USD 160 million to bring the Arava Mine back into production. It expects to extract about 2 million tonnes of copper oxide ore per year, which after passing through a heap leaching process then solvent extraction and electrowinning processes will yield 22,000 tonnes of copper cathodes per year for the next 20 years.

Ms Carla Garcia Granados director of Arava Mines said “We expect to have the plant operating by the end of 2009. We’ll start ordering equipment for long term delivery in a couple months in order to avoid delays.”

She said to date, AHMSA Israel’s Arava Mines has received the approvals and permits necessary to move forward with the construction and working of an underground mine and processing plant. She added that “We’re in the process of completing a basic engineering study and obtaining approvals and permits for plant construction, which will allow us to order and buy equipment for long-term delivery and start some building.”

Completing the basic engineering study is one of three near term project milestones Arava Mines is working to realize. The second is taking delivery of essential equipment, including a continuous miner, a scoop tram, four low profile SandvikToro 40 trucks and the manufacturing of a rod header. One continuous miner and two low profile Toro 40s are already working on site.

Arava is also looking forward to completing installation of a 500 meter conveyor that will enable the company to start preparing the tunnels that will connect the extractor and conveyor and pave the way for opening all the mine’s ventilation systems.

Assembling all these components of the production process and testing them together will enable the company to estimate its mining and production costs in sufficient detail - +/- 10% - for management to complete and finish its basic engineering study.

Allied establish JV with KADDB and DMV Holdings

AM Allied Defense Group Inc announced that its Belgian subsidiary, MECAR SA has entered into a joint venture with King Abdullah II Design and Development Bureau or KADDB, an independent Jordanian government entity and DMV Holdings LLC, an international investment and marketing company.

MECAR is an integral and strategic partner of the JV because it has the necessary technical & operational experience, manufacturing & assembly equipment and intellectual property.

AM Allied Defense Group Inc said that the aim of the joint venture is to establish an ammunition manufacturing and assembly facility in Jordan for small caliber cartridges cases and bullets, as well as assembly of large caliber charges and tank ammunition.

Allied Defense added that for MECAR, the joint venture presents not only an initial sales opportunity of equipment and technical know how but also an opportunity for annual recurring product sales to the joint venture company.

Lemhyer recommended setting up of 4 hydropower stations

Daily Times reported that Bhasha consultant, the German Company Lemhyer has recommended the government to set up four hydropower stations of 1,150MW under Bhasha Diamer Dam Project for the royalty to North West Frontier Province and Northern Areas.

Lemhyer has recently completed the draft of detailed engineering design of Bhasha Dam Project. The draft has been circulated to concerned departments and ministries. However, the final engineering design would formally be issued by June 30. Bhasha dam is one of the five major reservoirs that Mr Pervez Musharraf president announced in 2005.

Sources said in the detailed draft engineering design circulated to different concerned departments, the company has recommended to keeps flow rate of water at the level to fill the dam in four years. According to the initial design, it was recommended to fill the dam in two years. The company has also recommended storing 60% water in the dam from the water inflows and release 40% water from dam to generate power and irrigation.

The official informed Lemhyer has also recommended to the government to maintain outflow of 35,000 cusecs water from the dam every month. In the draft, the company has asked to keep 1,160 meter height of the dam instead of 1,170 meters height set earlier. The company has said that this change in height will help to store the water at the time of sudden melting of glaciers.

Sources said that “The Company will brief the WAPDA on April 30 about the environmental impact of the dam’s construction and all stakeholders will hold meeting to review the environmental impact of the dam construction in the third week in Gilgat.” Diamer Bhasha consultants in the detailed engineering design have indicated cost of USD 8.505 billion at present against the earlier projected cost of USD 6.5 billion in year 2005.

KPI to invest USD 600 million in Kuwait-Japan oil refinery

MENAFN reported that Kuwaiti and Japanese oil companies will formally embark next week on their first ever joint project to build a refinery in a third country, with Kuwait Petroleum International being expected to shoulder about USD 600 million of the funds. Construction of the refinery and petrochemical complex will start as early as 2010, aiming to be operational late 2013.

An Idemitsu spokesman told MENAFN that a signing ceremony of the joint venture deal is to take place in Hanoi.

KPI an international arm of state run Kuwait Petroleum Corporation and Japan's third biggest refiner Idemitsu Kosan Co will evenly own a 35.1% stake in the venture to construct a USD 5.8 billion petrochemical complex with a refining capacity of 200,000 barrels per day in northern Vietnam.

State owned PetroVietnam will hold 25.1% Mitsui Chemicals Inc 4.7% respectively. Nghi Son Refinery and Petrochemical LLC, slated to be set up in June with a capitalization of USD 200 million, will spend two years in studying basic equipment design, economic efficiency and finance scheme to determine whether to build the plant.

According to the spokesman, the partners will aim to secure about 70% of the construction costs through project financing led by the government-affiliated Japan Bank for International Cooperation. He said "As the participating firms will provide the reminder of the funds depending on our ratio of investment, KPI and Idemitsu are likely to contribute around USD 600 million each."

The spokesman said "Though Vietnam is also an oil producer the refinery will be designed to process 100% Kuwaiti heavy crude oil, which churns out high priced petroleum products such as gasoline and kerosene in a cost effective manner."

Shenhua to buy USD 1.6 billion of parent's assets

Reuters reported that China Shenhua Energy Corp, the world's most valuable coal miner plans to buy assets worth CNY 11 billion from its state parent.

A source close to the deal, which is a typical path employed by listed Chinese firms hoping to expand rapidly told Reuters recently that the assets to be bought included non coal operations, but he declined to elaborate.

Shenhua has long expressed its intention to gradually absorb its unlisted parent's sprawling assets, and is keen particularly to buy high quality coal operations. The firm is now exploring acquisitions as far afield as Australia, Indonesia and Mongolia.

Shenhua plans to expand its coal production by about 15 million tonnes annually, hoping to hit 200 million tonnes of yearly production by 2010.

Taigang 2007 net profit grows by 73% YoY

It is reported that Taigang Stainless Steel Company Limited reveals in its annual report 2007 achieving a net profit of CNY 4,248,605,880.72 up by 73.81% YoY.

During the year covered by the report, Taigang Stainless built second coke oven with tallness of 7.63 meter per 90 tonnes extra high power eclectic oven per 180 tonnes RH vacuum oven and CR stainless wide breadth hot rolling line etc and put then into operation. Its CR silicon steel expansion item was also completed and started production to full capacity, making annual capacity up to 400,000 tonnes.

Taigang made pig iron of 7.4081 million tonnes up by 85.6% YoY; steel of 9.293 million tonnes up by 72.27%; stainless steel of 2.0255 million tonnes up by 82.54%. Operating revenue totaled CNY 81.105 billion up by 100.5%; gross profit CNY 5.301 billion up by 57.05%.

Taigang further plans to produce 7.62 million tonnes pig iron 10 million tonnes steel, including 2.6 million tonnes stainless steel and 9.74 million tonnes billet/slab including 2.39 million tonnes stainless semis. It will also issue CNY 4 billion short term financing bills this year to feed production and operation.

Shougang ink agreement with Malaysia Lion Group

It is reported that China Shougang Group and Malaysia Golden Lion Group on April 4th singed a contract in Kuala Lumpur. Mr Cheng Yonghua Chinese ambassador to Malaysia, Mr Mu Youding minister of Malaysia International Trade and Industry department, Mr Zhong Tingsen president of Golden Lion Group and Mr He Wei president of Shougang International Engineering Technology Company were present at the ceremony.

Mr Zhong Tingsen expressed that Golden Lion Group has more good cooperation with Chinese iron and steel enterprises the contract worth with Shougang Group this time reaches MYR 239 million. Shougang will construct 2.2 million tonne coke furnace and 2.8 million tonne slag plant for it. In addition, Golden Lion Group will invest MYR 4.2 billion to construct BF smelting plant, to enhance the steel production capacity to 8.2 million tonnes from current 4.2 million tonnes. At that time, it will become the largest steel producer in ASEAN region.

Mr He Wei said that Shougang Group is a large steel enterprise in China, Golden Lion Group is the famous steel production enterprise in Malaysia. Through this cooperation, Shougang will rely on professional technical equipments to assist Golden Lion Group enhance the production capacity, reduce the energy consumption and production cost, improve its competitiveness, and promote Sino-Malaysian further cooperation in iron and steel industry.

First homegrown stainless continuous casting machine debuts

It is reported that the first self-made 220×1,600mm stainless arc-shape slab continuous casting machine has produced the first tap of billet at Taishan Iron and Steel Group, which lies in province Shandong, the east of China. The single-strand caster has a capacity of 800,000 tonnes per year.

The 20th China Metallurgical Construction Corporation of MCC, as the project contractor, took seven months to install over 2,400 tonnes of equipment, almost 90 tons of pipes and lay around 35 kilometers of cable since the project broke ground on September 8th 2007.

Handan Steel successfully exploited new mechanical steel plate

It is reported that Handan Iron and Steel Company medium plate plant recently has successfully rolled out Q500D mechanical steel plate. After inspection, the yield intensity, tensile intensity, elongation rate of this product reached 545 Mpa, 670Mpa, 19% respectively, the three indicators are all better than the international standard, and the plate type and the surface quality are good.

Q500D mechanical steel plate is a higher technological content and high value added product in medium plate series. It has high intensity, excellent welding performance, good low temperature toughness etc specialties. The demand for this product is very stable, the monthly demand from two large scale machinery manufacture factories in central China and North China is more than 2000 tons.

Q500D mechanical steel plate is often used in crane, excavator, heavy vehicle etc large-scale machinery and coal hydraulic pressure bracket, bridge construction etc fields.

Province Hebei plans to merger Tangshan Steel and Handan Steel

An official from State owned Assets Supervision and Administration Commission in province Hebei said that “It is possible for the merger of Tangshan Steel and Handan Steel at present and we have to wait for the decision of provincial government now.”

However, the performance of the merger may not be so soon. Different from iron and steel industry in province Shandong, there are only three super sized steelworks with a capacity over 5 million tonnes per year in province Hebei, but total crude steel capacity in province Hebei is 110 million tonnes per year. Only new Tanggang Group and Handan Steel Group are under control of State owned Assets Supervision and Administration Commission in province Hebei.

According to the program in “11th five year plan” in province Hebei, they plan to construct two steel groups in the south and north. In the south of province Hebei, Handan Steel would acquire Shijiazhuang Steel and Xingtai Steel, while in the north, Tangshan Steel would acquire Xuanhua Steel and Chengde Steel. The merger in the north has obtained great progress, but the merger in the south develops slowly.

Mr Wang Junjie the general manager of Handan Steel said “We would not like to acquire private steelworks around us by the advantage of raw materials price hike. He said because some private steelworks in province Hebei have strong ability in resisting risks. Although Handan Steel is using long-term contract ore, raw materials cost is lower than it in private steelworks, the labor cost is much higher, so the production efficiency in private steelworks is even higher than it in Handan Steel.”

It is realized that province Hebei would boost the consolidation or strategic cooperation of Tangshan Steel and Handan Steel after Handan Steel have completed the merger of small sized steelworks in the south, in order to build a super sized steel union with a capacity of over 50 million tonnes per year which is able to lead domestic steel market and influence international market as well.

NOOC to complete first step towards internationalization goal this year

Interfax China reported that China National Offshore Oil Corp aims to complete the first step of its plan to become an integrated energy company capable of competing on the international market this year, an official with CNOOC said yesterday at a conference in Beijing.

Mr Luo Ming an analyst with the CNOOC Development Institute, which plans the company's long term goals said that this year, the company will finish all its downstream projects that have been in the pipeline since 2004. In addition, it will produce 40 million cubic meters of oil and gas this year, which is the main feature of the company's 10th five year plan and the first step in its plan to become an international energy company.

Mr Luo said CNOOC still lags behind its foreign offshore counterparts in its ability to explore oil deposits far under the sea. CNOOC's deepest offshore oilfield is 333 meters deep, while other offshore oil companies can operate oilfields that are as much as 2,192 meters deep. He said the company has already begun to explore for oil in the South China Sea, as well as acquire overseas oil and gas fields to increase the company's overseas output.

However, one industry insider who wished to remain anonymous told Interfax at the conference that CNOOC's efforts to explore for oil in the South China Sea could be offset by political issues. Insider said "Some surrounding countries control parts of the oil and gas fields in areas where China and these countries have sovereignty disputes. This will be a big political issue that CNOOC will have to address when exploring for oil in the South China Sea."

China encourages mineral firms to list overseas

Xinhua quoted China Ministry of Land and Resources said that China will encourage domestic mineral exploration companies to list on overseas exchanges to raise funds for their development.

According to China's first geological exploration plan which was issued by the ministry recently, the government will support their foreign and domestic listings.

Analysts said overseas listings would address the lack of funds that had stymied the development of China's mining and minerals sector, which had long relied on state finance.

Mr Hu Cunzhi director of the ministry's planning department said Government backed exploration had dominated the sector, which didn't suit a market economy and weakened the industry.

The plan stated that exploration should focus on commercially viable projects and the government wouldn't invest in profit-making projects in principle. It said that foreign investment would be encouraged in domestic mining and exploration. The government would support joint efforts by private and state-owned companies to form large mining groups with an international competitive edge.

By 2010, China aims to have established a group of overseas bases for the exploration and production of oil, natural gas, coal, iron and copper.

AD investigation against steel nail from US will shut down many steelworks in China

It is reported that the primary result of anti dumping investigation by US against steel nails imported from China has been issued for only two months, but the effect on Chinese steel nails producers is significant now. It is indicated that the result has caused some medium and small sized steel nail mills in China whose key export destination is the USA collapsed.

A steel nail producer in China noted that they have to give up the market in the USA and move to export to other countries or regions. The decrease of business scale would bring a loss of a hundred million of RMB. Moreover, he revealed that they are now actively preparing for final investigation.

According to statistics from China Chamber of Commerce of Metals Minerals % Chemicals Importers & Exports anti dumping investigation this time covers 70 companies in China.

SanSteel Minguang Q1 net profit up by 70% YoY to 100% YoY

It is reported that the net profit of SanSteel Minguang Company in the first quarter of 2008 up by 70% YoY to 100% YoY than the same period last year.

The main reasons for it as follows:
1. Output of the company increased by over 40% than the same period last year.
2. Business income increased by over 100% than the same period last year, medium and heavy plate sales rose up over 150% and sales income rose up over 200%.
3. Tax rate dropped by 8% than the same period of last year since they implemented the new business income tax policy this year.

Ansteel once more raised HRC and CRC sales prices for May

It is reported that Anshan Iron and Steel Company has raise again hot rolled coil and cold rolled coil sales prices of CNY 200 per tonne and CNY 100 per tonne respectively for May after CNY 750 per tonne and CNY 650 per tonne price rising in April.

The ex-work price of Q235 5.5mm hot rolled coil will reach to CNY 4870 per ton, and CNY 5437 per ton for ST12 1.0mm cold rolled coils.

Q235 5.5mm hot rolled coil quotation in Shanghai was CNY 5350 to 5400 per ton at present, but ST12 1.0mm cold rolled coil market price was CNY 6350 to CNY 6400 per ton, the above-mentioned all included 17% value added taxes.

Chalco new alumina plant to cost over CNY 3 billion

XFN Asia cited Mr Zhang Qing Chalco's investor relations manager as saying that Aluminum Corp of China Ltd expects to start work soon on an 800,000 tonnes per year alumina refinery in northern China with the cost estimated at over CNY 3 billion.

Mr Zhang told XFN Asia referring to the National Development and Reform Commission, China's central government economic planning agency 'We've gotten NDRC approval for the new plant, but haven't broken ground on the site yet.

Mr Zhang said a rule of thumb construction cost estimate of around CNY 5,000 per tonne of capacity which suggests overall costs nearer to CNY 4 billion. However, he would only say that the cost is expected to be over CNY 3 billion.

Taigang cooperated with Butting Group

It is reported that Taigang Group International Trade Company has signed a medium and heavy plate order of around 7.50 million tonnes with Butting Group, a large scale welded pipe enterprise in German. This is the second time for Taigang to cooperate with Butting Group.

Butting Group is a specialized welded pipe producer for 230 years, and the annual stainless pipe output exceeds 40,000 tonnes.

The cooperation between Taigang and Butting Group indicated that Taigang played an important role in China’s stainless steel enterprises.

Nickel price predicted to be drop in Q3 this year

Mr Liu Boya an analyst of Macquarie Bank said in a meeting that nickel price predicted to be drop in the third quarter this year.

Nickel price remained strong in the second quarter because stainless steel production was in the peak season. The increasing demand for stainless steel is likely to promote nickel price to USD 35,000 to USD 40,000 per tonne from the current USD 29,000 per tonne. But after this period, nickel price will begin to drop gradually. Nickel price will drop back to USD 18,000 to USD 25,000 per tonne from 2009 to 2010, and USD 12,000 to USD 15,000 per tonne after the year of 2011.

Stainless steel output slowed down since the year of 2007. Crude stainless steel output in 2007 was 7.50 million tonnes and predicted to reach about 9.0 million tonnes in 2008, the average growth rate in the next few years predicted to reach 10%.

Handan Steel unveils latest EXW prices

It is reported that Handan Steel publishes its latest EXW prices for some products, on the basis of prices released on March 28th 2008.

Wire Rod price up by CNY 20 per tonne
Rebar and Round Bar price unchanged.
Q235 6.5mm common carbon wire rod is quoted at CNY 5070 per tonne
Q235 6.5mm high speed wire rod price at CNY 5110 per tonne
HRB335 12mm rebar price at CNY 5370 per tonne
HRB335 14mm rebar price at CNY 5320 per tonne
HRB335 16mm to 25mm rebar price at CNY 5170 per tonne
Q235 16mm to 25mm round bar price at CNY 5210 per tonne.

Medium Plate price up by CNY 50 per tonne.
Latest EXW price for Q235B 20mm medium plate stands at CNY 6100 per tonne.

Ship-building Plate price unchanged CNY 50 per tonne higher for those with thickness of 50mm or more.
CCSA20mm ship-building plate is offered at CNY 6595 per tonne.

Prices listed above are inclusive of 17% VAT effective as of April 8th 2008.

(Sourced from MySteel.net)

Rautaruukki to strengthen service centre operations in St Petersburg

Rautaruukki announced that it is planning to increase the capacity of its service centre in St Petersburg to meet growing demand in Russia. A new cut to length line will start up at the Parnas service centre in northern St Petersburg in autumn 2008. The existing machinery at Parnas has already been modernized.

A comprehensive range of cut to length and slitting services will enable us in particular to serve light engineering customers who relocate their production to the St Petersburg area. Relocating the production of roofing products, which has been fairly minor, to Finland will free up the space Ruukki needs to grow service centre operations in St Petersburg.

Mr Olavi Huhtala president of Ruukki Metals said that Russia is an attractive, growing neighboring market for Ruukki. Despite the growing market, there is still no serious competition in service centre operations in Russia. A comprehensive range of prefabrication services, local personnel and prompt delivery times give our customers the chance to focus on their own core business.

The Parnas service centre was opened in 2001. Ruukki established its first production unit in Russia in the mid 1990s. In addition to St Petersburg and Moscow, Ruukki has sales operations in a number of Russian growth centres.

Ruukki has about 2,100 employees in Russia.

Ukraine climbed to rank 4 among largest steel exporters in 2007

According to Iron and Steel Statistics Bureau, Ukraine ranked 4th among the largest steel exporters in 2007. Last year Ukraine swithched postitions with Russia that was 4 in 2006. The largest exporter was China with 65.2 million tonnes steel exports volumes. This country continued to be a major driver not only for the world steel production but also for steel exports. The latter grew by huge 33% YoY in 2007.

In million tonnes

Siberian cement to buys Turkish division of Italcementi

FIS reported that Siberian Cement, Russia's second largest cement holding entered into an agreement with Italy's largest cement producer Italcementi Group on the purchase of the Turkish cement holding Italcementi Set Group.

The report said 10 companies took part in the auction on the purchase of Italcementi Set Group, including the funds representing the interests of Alfa Group and Baselcement.

Under the agreement the vendor, Ciments Français is to transfer to the buyer 78.49% of the shares of Afyon Çimento Sanayi TAŞ., 100% of the shares of SET Group Holding AŞ, 100% of SET Beton Madencilik Sanayi ve Ticaret AŞ. The deal's worth totaled EUR 600 million.

ArcelorMittal gives Severstal a discount

Kommersant reported that Severstal has overcome stiff competition to reach an agreement with ArcelorMittal on the purchase of the Sparrows Point steel mill near Baltimore at Maryland in the United States. The Russian company bought the mill for USD 810 million. Last year, the E2 Acquisition Corp consortium agreed to purchase the mill for USD 1.35 billion but was unable to raise the money. The sale of the mill was one of the conditions placed on the merger between Arcelor and Mittal Steel by American antimonopoly authorities.

Severstal was interested in Sparrows Point last year, when E2 won it. E2 is made up of the American companies Esmark Inc and Wheeling Pittsburgh Steel Corporation, the Brazilian CVRD and the Ukrainian Donbass Industrial Union. The current deal is expected to be completed by the end of the second quarter of the year. It will make Severstal the fourth largest steel producer in the US by production volume. Sparrows Point is the only steel producer in the US that uses its own raw materials and has direct access to the ocean. It also has its own 120 MW electric plant. The mill has a capacity of 3.6 million tonnes of steel per year. In 2007, it produced 2.3 million tonnes and its profitability was less than 5%.

A source close to the seller said that Severstal's offer was far from the best it received. The source said that a consortium of the Russian Magnitogorsk Iron and Steel Works and the Indian Essar offered cash and stock in their joint venture worth USD 1.6 billion and the mill's union played a significant role in the choice of Severstal. The Ukrainian Private group is said to have bid USD 860 million and the Russian Novolipetsk Steel less than USD 800 million. Analysts say its new acquisition should increase Severstal's receipts by 7% and its EBITDA by 5%.

NVTR to increase statutory fund

It is reported that Novomoskovk Pipe Plant is going to increase its charter fund 16.7 times to USD 10 million. If the issue is approved, which is the most probable scenario, 188 million of new ordinary shares at USD 0.05 par value will be issued. The subscription is to take place in two stages scheduled from June 9th to 23rd 2008 and from June 24th to 29th respectively with ex rights date June 9th 2008.

Novomoskovk Pipe Plant said we think the subscription to be aimed at a capital structure adjustment with a view toward rising debt. Currently Novomoskovk Pipe Plant operates with a dramatically low share capital of USD 0.6 million. We are staying positive on Novomoskovk Pipe Plant and recommend accumulating the stock and participating for the equity increase. If the stock does not fully adjust, which is typical for the Ukrainian stock market, the strategy will earn an additional return.

LTPL Plans to increase output to USD 300 million in 2008

According to the press service of Luhanskteplovoz, the company plans to increase output to USD 300 million in 2008. It was also noticed that in the current year Russian orders will amount to at least USD 180 million.

Russian Railways has ordered 110 sections for 2TE116U main line diesel locomotives from LTPL.

There exists a large and stable market for LTPL's products since Russian Railways intend to purchase 160 sections for main line diesel locomotives annually until 2015. However, in the mid term there is a risk that orders will be placed at Russian railcar producers if the ownership conflict does not end in favor of Bryansk Railcar Plant.

The company won a privatization auction for a 76% stake in LTPL in summer 2006. But the auction was judged illegal by the Higher Economic Court of November 8th 2007. The Supreme Court of Ukraine recently refused to review the ruling of the Higher Economic Court. We believe the news is neutral for LTPL.

Russian Railways to team up for copper deposit tender - paper

RIA Novosti reported that Russian Railways is establishing a consortium to develop the world's third largest copper deposit in the Chita Region in Russia's Far East.

Business daily Kommersant reported that the Russia ministry of natural resources announced that it would announce within a week the terms of a tender to develop the Udokan copper deposit located 30 kilometer south of the Chara station of the Baikal Amur rail line.

The paper said RZD is setting up a consortium with the state run corporation Development Bank and the Urals Mining and Metals Company. RZD and the Development Bank will hold a total of 51% in the consortium.

RZD will contribute an unfinished railroad approach to the Chineisky copper deposit in the Chita Region and will be responsible for transport infrastructure in the consortium, Vnesheconombank will provide the larger part of financing and UGMK will be the project's sectoral operator.

The paper quoted Mr Vladimir Yakunin president of RZD as saying that "RZD will stay in the consortium until it repays its investment."

The Udokan deposit accounts for 15% of the world's copper reserves. As of January 1st 2008, its balance B+C1 reserves included 14.4 million tonnes of copper, 7,300 tonnes of silver and 1.9 tonnes of gold.

Vnesheconombank and UGMK have not yet officially commented on their plans about the Udokan copper deposit.

Russian gas producer Novatek's proven reserves in 2007 up by 0.3% YoY

RIA Novosti reported that Russian gas producer Novatek proven SEC standard natural gas reserves had grown 0.3% YoY in 2007 to 653 billion cubic meters.

Russia's largest independent gas producer said its SEC standard liquid hydrocarbon reserves totaled 4.678 billion barrels of oil equivalent in the reporting period, compared with 4.664 billion barrels a year earlier.

Novatek which established in 1994 handles prospecting, production and refining of gas and liquid hydrocarbons. Its gas fields are located in the Yamal Nenets autonomous area, which has the world's largest natural gas reserves. The region accounts for over 90% of Russian natural gas output and around 20% of global gas production.

Kazakhstan and China plan to start work on gas pipeline

Kazinform reported that China and Kazakhstan will start building a cross border natural gas pipeline this year and the second phase of a crude oil link between the nations.

Mr Zhou Jiping vice president of China National Petroleum Corp said China National's oil production in Kazakhstan, where the company has invested USD 6.5 billion reached 18.62 million tonnes last year. That's about 373,000 barrels a day. But he declined to give more details on the pipelines.

Mr Zhou said that ”We will further enlarge investment in Kazakhstan and also welcome Kazakh companies to come and invest in China.''

Mr Wang Jing deputy director in the energy bureau of the National Development and Reform Commission said that Kazakhstan plans to increase gas production to 80 billion cubic meters in 2015 from a projected 35.7 billion cubic meters in 2009. China's gas demand may rise by more than 15 percent annually for the next 20 years.

Mr Uzakbai Karabalin CEO of energy producer KazMunaiGaz National Co said Kazakhstan plans to spend about USD 3.4 billion on a pipeline to take natural gas from the Caspian Sea through the country's south and on to China by 2011. He said the project will transport as much as 5 billion cubic meters of Caspian gas a year via the Beyneu-Bozoy-Samsonovka link.