SAIL sets new performance landmarks in 2007-08

Steel Authority of India Limited, which entered its golden jubilee year of production in February 2008, has ended the year 2007-08 with new landmarks in performance by producing 13.04 million tonnes of saleable steel for the first time. This was a consequence of several initiatives like utilizing full potential of available assets and human resources, R&D interventions, implementation of de bottlenecking schemes etc.

Production of hot metal and crude steel was also highest ever at 15.2 million tonnes and 14 million tonnes, respectively. About 465,000 tonnes of additional saleable steel were produced during the year by utilizing 118% of rated capacity. It also achieved highest ever sales during 2008 at 12.4 million tonnes. The financial results of SAIL for 2007-08 will be announced in May 2008.

Highest ever production of 1.2 million tonnes of saleable steel in March 2008 was the highlight of this record annual performance, matched by record March 2008 sales of 1.3 million tonnes.

During 2007-08, the component of finished steel in saleable steel went up to at 10.8 million tonnes up by 83% YoY with improved performance of finishing mills. Growth of 30% was recorded in production of special steels and value added items during 2007-08 at 3.7 million tonnes. There was marked improvement in various categories of special steel
1) Electrode quality wire rods – up by 22% YoY
2) TMT HCRM wires & rounds – up by 731% YoY
3) LPG grade HR coils/sheets/plates – up by 11% YoY
4) SAILCOR HR/CR coils – up by 44% YoY

SAIL achieved highest ever production of rails at 911,000 tonnes. Long rail production exceeded the 100,000 tonne mark up by 58% YoY. The captive mines of SAIL met 100% iron ore requirement of the company's steel plants by producing around 25.7 million tonnes of iron ore during the year. Coal production by the company's captive collieries almost doubled to 1.018 million tonnes.

SAIL achieved lowest ever values in specific energy consumption of 6.95 giga calorie per tonne of crude steel, coke rate of 535 kilograms per tonne of hot metal and metallic input of 1,134 kilograms per tonne of crude steel, among other efficiencies. Production through the energy saving continuous casting route rose to 8.9 million tonnes up by 7% YoY, with capacity utilization at a record 128% during 2008. SAIL also recorded best ever labor productivity at 213 tonnes per man during 2008, with Bhilai Steel Plant reaching a level of 288 tonnes per man.

At 11.9 million tonnes, SAIL achieved highest ever domestic sales during 2007-08. Sales of value added products by SAIL showed substantial growth during the year. Sales of steel products used by the common man also grew considerably, like TMT bars at 53% and medium structurals at 15%. Record supplies of 2.4 million tonnes was made for projects of national significance to meet the critical requirements of key sectors like airports, railways, Metro Rail, highways, power projects, etc.

During 2007-08, SAIL expanded its distribution network to every district of India. With addition of 1,200 dealers during the year, the number of SAIL dealers in India has gone up to 1,897. This resulted in sales through dealers increasing by 300% during the year in which the company also made 8 new warehouses operational for better customer service.

NMDC to set up INR 16,000 crore steel plant in Chhattisgarh

Mr Rana Som chairman of National Mineral Development Corporation told Hindustan Times that it will invest INR 16,000 crore to build a 4 million tonne per annum capacity steel plant at Dilli Mili in Chhattisgarh. The proposal has been cleared by union steel ministry.

NMDC will hold 100% equity in the project while Rashtriya Ispat Nigam Limited will provide technical assistance while the plant is under construction. Mr Som said that the plant will be set up in less than 4 years and the work for NMDC’s steel plant will begin shortly.

He added that "NMDC is in the process of short listing a global consultant to carry out the detailed project report for its upcoming steel plant. On completion the plant will take the annual turnover of the corporation to INR 22,000 from INR 6,000 crore now."

According to Mr Som NMDC will source iron ore from Bailadila mines in Chattisgarh. Mr Som said that “Iron ore deposits at Bailadila were explored by NMDC and will make use of coke virtually redundant. We chose Dilli Mili from among 3 sites suggested by the project consultant MECON."

No plan to ban iron ore exports - Mr Pandey

BS quoted Mr R S Pandey steel secretary after a meeting with miners as saying that the government has no plans to ban exports of iron ore or levy an ad valorem duty on exports.

The meeting was called to discuss rising iron ore prices, which is prompting steel producers to increase prices.

The mining companies said they would look into possible ways to help the government check inflation. They, however, remained non committal on reducing prices.

Outotec to deliver two sinter plants to BSL

Outotec announced that it has been awarded a contract by Bhushan Steel Ltd for two iron ore sinter plants to be built at Bhushan Steel's integrated steel works at Meramandali in Orissa state of India.

The contract price is approximately EUR 18 million. The new sinter plants are expected to become operational in the second half of 2010.

Outotec's scope of delivery covers basic engineering as well as proprietary and special equipment for two sinter plants with a grate area of 204 square meter each.

Mr Tapani Järvinen president & CEO of Outotec said that "Outotec has delivered more than ten iron ore sinter plants in the last five years in India. The order of these two plants consolidates our leading position as a supplier of agglomeration technologies in India.”

Orissa government details 1,000 anti POSCO protestors

SNS reported that the massive police arrangement and prohibitory orders imposed since one week fell apart as hundreds of villagers including women and children broke barricades and cordons to reach the venue of Vikalpa Vikas Samabesh organized by POSCO Pratirodh Sangram Samiti and a host of other outfits.

As per report, several platoons of armed policemen watched helplessly as rallies led by villagers from different directions defied prohibitory orders, pulled down security barricades and reached Balithutha for the meeting. Police detained nearly 1,000 anti POSCO project activists while they were proceeding to participate in a rally.

Emboldened by the success of people reaching the Vikalp Vikas Samabesh meeting venue, leaders of POSCO Pratirodh Sangram Samiti, Visthapan Virodhi Janamanch of Kalinga Nagar, Naba Nirman Samiti, Rastriya Yuva Sangathan and left party leaders delivered fiery speeches. They vowed to oppose the proposed POSCO steel plant and asserted that they will not budge an inch from their land.

The speakers lambasted chief minister Mr Naveen Patnaik for selling minerals and water to the industries at the cost of the farming community. They rhetoric reached high pitch today with leaders claiming that the meeting had exposed the false claims of the government that majority for the people in the region were agreeable to displacement and had supported the project.

The week long drill of the administration and the imposition of Section 144 at the meeting venue collapsed to the public onslaught. There were a few tussles with policemen who tried to chase away villagers but failed. The police had also conducted preventive arrests of 200 people but villagers were undaunted.

POSCO had earlier planned to hold a ground-breaking ceremony for its plant at the proposed site on April 1st 2008. However, it was postponed last month due to procedural delays in various sanctions.

Broner Metals takes Metsys as partner in India

It is reported that leading provider of supply chain planning, scheduling and manufacturing execution systems specifically for the Metals Industry Broner Metals Solutions has appointed Metsys Engineering and Consultancy as its official sales and marketing partner in India.

Metsys main areas of operation are supply and engineering of process automation and electrical systems, which include engineering services with design and process control software, design and development of Level 2 systems and ERP and consultancy services prior to project initiation.

Broner said that “Metsys is an engineering and technical consultancy company focused primarily in the area of process automation with many years experience in catering to the needs of the metals industry. Specialists from Metsys have worked for companies like Danieli and ABB and implemented projects at steel companies such as Jindal Steel, SAIL and Isibars. This new partnership provides a strong combination that will ensure the most effective project implementation, with skilled and experienced local resources from Metsys and proven unique metals industry decision support solutions from Broner.”

Mr David Mushin CEO of Broner said that “This is yet another new Broner partnership worldwide, contributing to the steady growth and development of the Broner brand as the foremost solution for improving the business metrics of metals producers.”

Mr T Raghunath director of Metsys said that “Broner solutions are well known and respected worldwide and we are honored to represent Broner in India. We believe that together we offer a compelling proposition for Indian metals companies, and look forward to a long and prosperous partnership.”

Broner Metals Solutions specializes entirely in delivering value to the Steel and Aluminum industries. It provides Supply Chain Planning, Scheduling and Manufacturing Execution Systems and Consultancy, which improve shareholder value, through: reduced inventory; shorter manufacturing lead times; increased throughput; improved delivery performance and better customer service.

Lloyds British Testing opens its Indian outlet

It is reported that Lloyds British Testing has opened a division for its Lloyds Somers specialist handling products in Kolkata. With international headquarters already established in Dubai and Egypt, the new office will supply slab, coil and sheet handling equipment to metal producing industries on the Asian continent.

Lloyds British Testing intends to expand into service, repair and new product manufacture at this location within the next 12 to 18 months. The India office will be headed up by Mr Swapan Bose GM of Lloyds, who has significant sector experience, having worked for high profile industry specialists Jessops and Mukand.

Mr Ian White CEO of Lloyds British Testing said that "This is a major investment in offering our products at the all important local level. However, we are convinced that the Indian marketplace is one that will reap sizeable benefits for the business and enhance our support to our international client base."

Mr White added that "It is our intention to open complementary international offices over the next 12 months. Our short to medium term aim is to build an international lifting equipment engineering group of companies and we are already exploring further options in Saudi Arabia, Nigeria and Kuwait."

In the UK, Lloyds British Testing's annual turnover is now in excess of EUR 18million, with employing over 300 people within its ten UK outlets.

NMDC starts price hike drill

The Telegraph reported that National Mineral Development Corporation Limited has shot off letters to domestic steel companies, signaling a possible hike in prices.

In a letter written, NMDC said that new prices would come into effect from April 1st 2008 though it stopped short of quantifying the increase. It has stated that the new price would be benchmarked against the fresh contract to be entered with Japan Steel Mills for 2008-09.

The letter read that "Japan Steel Mills has not finalized the percentage increase or decrease in the prices for the year 2008-09 in respect to NMDC ore. Therefore, NMDC could not finalize the price with effect from April 1st 2008 for our long term customers."

It is likely that Indian steel makers will have to pay 65% more on lump and 88% on fines with effect from April 1st 2008 as global bench mark iron prices have gone up by 65% to 71%.

SAIL R&D files for 36 patents in 2007-08

The Telegraph reported that Research & Development Centre for Iron & Steel has filed more than 36 patents on intellectual property rights during 2007-08. The patents of the Ranchi based research and development wing of SAIL are related to plant performance, cost efficiency, energy conservation and quality improvement.

Mr Jagdish Singh ED in charge of RDCIS said that they developed several new products during 2007-08 fiscal. He said that “Armor plates for tanks for the defense sector, special steel and leaf springs for the automobile sector, plates for earthmoving equipment and special grade micro alloyed rails for railways are among the achievements.”

He added that "It has also indigenously developed an energy efficient burner technology called curtain flame ignition system, which has been successfully installed at the SAIL plant in Bhilai. The technology has helped reduce energy consumption by as much as 30% and improved the plant’s improvement drastically."

During 2007, RDCIS won 9 awards. But the most notable mention was in the publication Steel Plant Technologies, which gave a complete overview of the various steel plant technologies and products. Other achievements include publication of more than 170 RDCIS technical papers in national and international journals.

PM may intervene to ensure iron ore blocks to ArcelorMittal

PTI reported that Mr Ram Vilas Paswan Indian steel minister said that Dr Manmohan Singh prime minister of India could intervene to provide iron ore blocks to ArcelorMittal for its proposed 12 million tonne each in state of Orissa and Jharkhand in India.

The report cited Mr Paswan as saying that "Mr Mittal's problems will be sorted out and his demand for iron ore block will be met, if need be, by the intervention of the Prime Minister."

Mr Paswan said that "We will sit and sort it out and if necessary, the prime minister will intervene in the matter."

ArcelorMittal has signed MoUs with Jharkhand and Orissa governments to set up Greenfield steel plants wherein it will invest a total of INR 80,000 crore. ArcelorMittal requires 600 million tones iron ore every year for each plant. ArcelorMittal has already been allotted 2 coal blocks, 1 each in Jharkhand and Orissa.

Iron ore rail freight set to increase by 6%

It reported that freight cost for iron ore is set to increase following the reclassification of products by Indian Railways. The move would increase the transportation charges of iron ore by about 5% to 6%.

As iron ore price makes up 30% of steel cost, higher freight could further impact prices of the alloy that have risen by a third in the past few months.

Indian Railways, however, cut port congestion surcharge from 60% to 30% levied on ore moving from source to ports on ore meant for domestic use, while increasing the surcharge for ore meant for exports to 100% with immediate effect.

PFC floats subsidiary for consultancy services in power sector

Power Finance Corporation has floated a wholly owned subsidiary called PFC Consulting Limited to provide consultancy services in the power sector and in the related areas. The proposed subsidiary will have consultancy assignments of INR 60 crore to be executed over the next 18 months. The consultancy arm of PFC would be an extension of consultancy services group of PFC.

The new subsidiary would conduct bidding process for awarding projects of state utilities, besides offering contract and legal services and preparing feasibility reports for projects. It will also carry out services related to ultra mega power projects, including formation of special purpose vehicle.

Mr VK Garg CMD of PFC told newspersons that “There are huge opportunities for consultancy services in the power sector. PFC has decided to focus on these opportunities with the new subsidiary.”

Mr Garg added that the subsidiary is in talks with an international consultancy firm to float a joint venture to provide technical expertise to domestic power utilities.

PFC, a dedicated lending institution focusing on the power sector, had earlier been designated as the nodal agency for handling the 4,000 MW UMPPs. Of the nine UMPPs envisaged by the Government, three have been awarded by PFC, while the rest would be handled by PFC Consulting Ltd.

CIL MCL workers may go on strike to stop privatization of work

SNS reported that all the workers trade unions of Coal India Limited’s Mahanadi Coalfield Limited have stoutly opposed the move of the MCL authorities to privatize the burden removal work of Lingaraj mine from April 2008 threatening to paralyze the mine on this issue.

Addressing a big protest rally of workers here MCL trade unions leaders Mr Prafulla Pradhan, Mr Ananata Patra and Mr Badal Maharana of Indian National Trade Union Congress, Hind Majdoor Sabha and Bharatiya Mazdoor Sangh respectively vehemently opposed the move describing it as anti worker designed to deny job to land oustees and scale down the workers in the mine. They were critical of the management's move while there is no sanction of the parliament on privatization coal mine works.

Coming down heavily on the MCL authorities for the move, they said that there is no point in privatizing the burden removal works when the mine in the current year recorded highest ever production in burden removal and coal output from the mine.

A memorandum signed by Mr Ashok Samanta, Mr Chintamani Pradhan and Mr GD Mahanaty was also handed over to the Lingaraj area general manager Mr Amlesh Kumar in which trade unions threatened to go for all out strike at any time without prior notice unless the authorities scrap the tender.

According to colliery official sources, a tender was already floated for the removal works some months back wherein one private agency which is already engaged in coal production works in Lingaraj mine stood the lowest one in rate. It may be noted that there is strong under current of resentment prevailing in colliery set up against the private company which faced a lot of stir by its workers in past for its violation of various laws.

Calcutta HC urged CIL to complete the takeover of MAMC

It is reported that Calcutta High Court Justice Nadira Patherya has directed Coal India Limited to complete the process for the takeover of Mining & Allied Machinery Corporation Limited by June 2008.

As directed by the High Court, CIL deposited a bank guarantee of INR 75 crore for the purpose of preparing the groundwork for reopening of MAMC. CIL had filed a petition seeking time for such reopening, which was allowed by the court. The matter will next appear on June 9th 2008.

Earlier, in October 2007, CIL and Damodar Valley Corporation got the permission from Calcutta High Court to take steps for taking over MAMC, to run it as a going concern.

South East Central Railway crosses freight loading target

It is reported that South East Central Railway has crossed the freight loading target of 119 million tonnes set for 2007-08 and hopes to end up with a throughput of 121.5 million tonnes.

Mr Pradeep Kumar GM of South East Central Railway has congratulated the employees and officers for the outstanding performance of the zone in freight loading.

Bangladesh to stick to May deadline for gas bids – Report

Reuters reported that Bangladesh is sticking to a May 2008 deadline for international oil firms to submit documents for offshore gas bidding because it is keen to press on with efforts to boost output. As per report, the move comes despite requests by a number of international companies for Bangladesh to extend the time limit for submitting the documents, which closes in the first week of May 2008.

Mr Jalal Ahmed chairman of Bangladesh Oil, Gas & Mineral Corporation or Petrobangla said that "We conveyed to them our inability as we are keen to begin exploratory work by October 2009, otherwise the total package of gas drilling in 28 offshore blocks will be delayed."

Mr Muhammad Muqtadir Ali director of Petrobangla said that "The demand is growing fast and we will face a crisis by the 2011. Before that, we must add more gas to ensure at least 7% economic growth."

It may be noted that, before the bidding, Bangladesh organized a 2 day presentation on the energy sector attended by representatives of 28 international oil companies, which ended on March 31st 2008 in Dhaka. Bangladesh, with 13.54 trillion cubic feet of proven and recoverable gas reserves, is facing at least 100 million cubic feet of gas shortages a day. It now supplies up to 1,738 million cubic feet of gas daily against a daily demand of 1,833 million cubic feet of gas.

TATAs may sell stake in HV Axel and HV Transmission

BS reported that, to fund its Jaguar Land Rover buyout, TATA Motors is preparing to divest stake in 2 of its 100% owned business units namely HV Axel and HV Transmission.

According to sources, TATA Motors has been in talks with automotive firms, which include an international transmission giant. It is unlikely to offload a majority stake in both the profitable subsidiaries.

The report cited a TATA Motors spokesperson as saying that "As we pointed out on March 26th 2008, TATA Motors is examining several plans and will make appropriate announcements after internal assessment. We do not have any comments beyond this."

TATA Motors to invest INR 6,000 crore in Pune facilities

PTI reported that auto major TATA Motors will invest INR 6,000 crore in its existing plants and for setting up vehicle testing facilities in Pune in the next 4 to 5 years. It signed a MoU with the government of Maharashtra for the purpose.

Mr Ratan TATA chairman of TATA Group said that "This MoU with the Maharashtra government is a step towards realizing TATA Motors' plans to augment capacity at Pune plants in order to meet ever increasing customer expectations and demands both in India and abroad." He added that the investment is expected to generate additional direct employment of 1,500 at full capacity.

PGCIL secures USD 600 million loans from World Bank

Power Grid Corporation of India Limited last week announced that it has signed a loan agreement with World Bank for USD 600 million.

Dr RP Singh CMD of PGCIL and Ms Isabel M Guerrero country director India of World Bank have signed the loan agreement in the presence of officials from ministry of finance and ministry of power. Government of India has extended guarantee for this loan.

The loan will be utilized to fund a basket of the PGCIL's transmission projects during 11th plan, which shall strengthen the transmission system in the power deficits regions of India and also enhance inter regional power transmission capacity in India. Under the loan assistance, PGCIL shall implement HVDC terminal stations at Balia in Uttar Pradesh and Bhiwadi in Rajasthan along with inter regional and grid strengthening schemes for formation of strong and vibrant National Grid.

PGCIL, which is responsible for developing and operating regional and national transmission grid, has a long association with World Bank. It had earlier availed loans from World Bank for about USD 1.7 billion for various transmission projects.

Road transport share goes up in last 6 years

BL is reported that, between 2001-02 and 2006-07, the combined cargo volume handled by rail and road increased from 2,046.10 million tonnes to 3,464.25 million tonnes.

As per report, the share of the rail cargo dropped from 24.07% to 21.01% while, the share of the road sector steadily increased from 75.93% to 78.99%.

NTPC signs MOU for generating 2.09 billion units of electricity

National Thermal Power Corporation Limited recently announced that it has signed a MOU with power secretary, government of India for generating 2.09 billion units of electricity during the financial year 2008-09.

In addition, the MOU includes targets of important milestones relating to project completion schedule of ongoing power projects, coal mining activities, total quality management, human resources development, business development activities including activities of gas exploration, distributed generation, R&R, ERP and R&D, energy technology project management certification, ash utilization and environment measures and also the targets in respect of subsidiaries of NTPC.

75 auto ancillaries to come up at TATA Motors Pantnagar

BS reported that several auto ancillaries units are setting up shop near TATA Motors’ plant at Pantnagar in Uttarakhand.

As per report, TATA Motors is starting its new Ace manufacturing facility, spread over 1000 acres, at an investment of INR 1000 crore.

The facility would house nearly 75 ancillaries, out of which nearly 63 have already been given industrial plots. The ancillaries would set up their units in Pantnagar at a total investment of more than INR 800 crore.

There are expectations that TATA Motors might start something big besides manufacturing Ace. Officials do not rule out the possibility that some parts of Nano may be produced in Pantnagar.

Gammon to redevelop business district in Bhopal

BS reported that Gammon India has finally clinched the INR 338 crore re densification project to build a central business district in a prime business locality of Bhopal as the state cabinet has decided to accept the single bid offer by the company, which qualified for it in December 2007. Gammon outbid 17 big companies like L&T, Reliance and DLF to clinch the deal.

A government spokesperson said that "State cabinet has accepted Gammon India’s single bid for the project. As many as 133 residential quarters have been vacated and most of them have been demolished in the locality and 59 families have been shifted in other locality."

Reports earlier surfaced that the government had been toying with the idea of canceling the bid offer, which was 150% more than the reserved floor price of INR 225 crore.

The project is to create shopping malls, Cineplex and other facilities in an area of 15 acres of land on public private model. To arrange land for the project, 192 residential quarters for government employees will be demolished, which were constructed in 1958.

Cairn India reports net loss of INR 24.54 crore in 2007

Cairn India has announced a net loss of INR 24.54 crore for the year ended December 31st 2007 as against a net loss of INR 21.17 crore in the year ended December 31st 2006. The income rose to INR 1,144.67 crore in the year ended December 31st 2007 from INR 44.96 crore in the year ended December 31st 2006.

Cairn India announced a standalone net loss of INR 78.82 crore for the year ended December 31st 2007 as against a net loss of INR 29.22 crore in the year ended December 31st 2006. The standalone income rose to INR 33.96 crore in the year ended December 31st 2007 from INR 5.91 crore in the year ended December 31st 2006.

OVL makes USD 1 billion offer for 3 blocks in Angola

ET reported that ONGC’s overseas arm ONGC Videsh Limited has made a USD 1 billion offer to develop three offshore oil blocks in Angola. As per report, OVL, along with two other oil majors, has made a proposal to Angola for development of the three oil exploration blocks that currently have Sinopec of China and Angola's national oil firm Sonangol as equity participants.

In March 2007, Sonangol ended talks with China Petroleum & Chemical Corporation over investing in the plant, which was then estimated to cost USD 3.7 billion. Angola has proven oil reserves of over 10 billion barrels. It plans to increase average output to two million barrels a day by the end of 2008.

Mr Jairam Ramesh union minister of state for commerce took up OVL's case for a stake in the blocks that may hold sizable oil reserves, when he met Angola's petroleum minister Mr Desiderio da Costa. Mr Ramesh said that India also expressed interest in building a 200,000 barrel per day oil refinery in the port of Lobito at an estimated cost of USD 5 to USD 6 billion. He added that "The petroleum minister has promised to expedite the proposal which has been pending for sometime."

Mr Ramesh further added that "Not much progress has been made since then and we do not want to lose this opportunity now. India has again expressed its interest in participating in the refinery and will expedite the process."

POSCO unveils mega growth plans on 40th anniversary

South Korean steel major POSCO on its 40th anniversary announced that it aims to triple its revenue to KRW 100 trillion by 2018 by beefing up overseas businesses.

At an anniversary event held at POSCO's Pohang headquarters, Mr Lee Ku taek CEO said the company is seeking to produce over 50 million tonnes of steel with 40 million tonnes at home and the rest overseas in 10 years.

Mr Lee said that “We will achieve our goals through new growth engines adding that reaching the KRW 100 trillion revenue target will not be easy. But we must press on further as we have done so in the past through times of globalization.''

He added that “Today's global economy tells us that circumstances aren't going to be on our side. But our past 40 years tells us that hardships are there to be overcome.''

Mr Lee said that new production plants in India, the Middle East, the Americas and Europe will undergo expansion to maximize the steel maker's overseas sales networks. He added that currently, POSCO has plans to build integrated steel mills in India and Vietnam, which is expected to significantly speed up the company's output.

Mr Lee further added that in an effort to sustain growth, POSCO aims to boost revenue from its non steel operations to KRW 30 trillion annually by strengthening its existing engineering and energy units.

POSCO said that its target revenue for 2008 is KRW 34.3 trillion on a consolidated basis and target output is 35 million tonnes.

Vale and BNDES sign financing contract

Vale announced that it has entered into a contract for a committed credit facility with Banco Nacional de Desenvolvimento Econômico e Social, the Brazilian National Development Bank for ZAR 7.3 billion.

The release said that “The funds provided under this credit facility should be used by Vale to finance part of its CAPEX program of USD 59 billion for 2008/2012. In addition to investment in mining and logistics, the funds could also be allocated to finance investments in social and environmental projects.”

It said that “The committed credit facility will be available for 60 months. The loans will have a 10 year tenor, including grace and amortization periods, which is in line with the long term nature of mining investment and consistent with our strategy of mitigating refinancing risks.”

Vale added that “The contract signed is an important support to our CAPEX program, enhancing our capability to create shareholder value and thousands of new jobs.”

Champion Pipes and Mitsui Tubular to merge

Champions Pipe & Supply Inc and Mitsui Tubular Products LLC announced that they will merge, effective April 1st 2008. The combined company will be known as Champions Pipe & Supply Inc.

Champions, founded in 1985, is one of the major OCTG distributors in the US market with access to domestic mills. Mitsui Tubular Products, established in 1983, is a distributor of 13 Chromium OCTG, drill pipe, line pipe, specialty tube, and plate, with access to mills in international markets, including Japan.

This merger will enable Champions to provide one stop shopping services as a full line tubular products distributor for the Oil & Gas Industry. The new combined company will generate approximately USD 600 million in annual sales and will be staffed by 40 employees.

Mr Ken DeLuish president of Mitsui Tubular Products, who will become the president of Champions said that "Over more than twenty years of operations, Champions and Mitsui Tubular Products have individually established a strong presence in the pipe industry. However, to meet our customers' ever increasing demands, we decided to merge the two companies and give customers the opportunity to find everything they need by contacting one company. Champions' access to domestic mills and Mitsui Tubular Products's access to Japanese and other mills outside the US will enable the new Champions to provide such services."

He added that "With this merger, the new Champions will have access to Mitsui USA and its parent company, Mitsui & Co Ltd both of which hold extensive assets globally. In addition to building on the strength of our U.S. business, we intend to grow the company by focusing on increasing our export business. We also intend to pursue opportunities to expand our business and product lines."

Mitsui & Co Inc is the majority shareholder of Champions and the sole parent of Mitsui Tubular Products. Immediately prior to the merger becoming effective, Mitsui USA will purchase the minority shares and become the sole parent of Champions. This decision reflects Mitsui USA's commitment to the energy related steel industry.

Strike Resources in talks for sale of Peru iron ore projects

Platts reported that Australian iron ore and base metal exploration company Strike Resources is in negotiations with a group led by a major international mining company for the potential sale of its iron ore projects in Peru.

Strike said it is in talks for the potential sale of up to 100% of the Cuzco and Apurimac iron ore projects in Peru, as well as other iron ore assets in Peru, for a sale price of USD 650 million. Strike did not name the mining group, and added that no binding agreement has been reached yet.

The Cuzco site, located in Peru's southern Andes is estimated to have 500 million tonnes of iron ore reserves and Apurimac also in southern Andes, 730 million tonnes of hematite and magnetite. The report said the Cuzco site is expected to start iron ore production in 2009, and the target output in 2011 was set at 20 million tonne per year of iron ore and this plan has attracted the interest of steelmakers and trading houses in China and Japan.

Canada to propose advance notice on import shipments

Exim News Service reported that a proposal similar to the US’ advance notice on import shipments has been introduced in the Canadian Parliament.

The relevant portions of the Customs Act include Clause 16, section 164(b) which requires the owner or person in charge of a conveyance to give advance notice of the time and place of arrival in Canada and other information relating to its passengers and goods.

Klöckner 2007 sales up by 13.4% YoY

The international multi metal distribution company Klöckner & Co, announced that its sales increased by over 13% in the last financial year, thus generating the second best operating result in the 100 years of the company’s history. At the same time, with the acquisition of twelve companies and the realization of the demanding objectives of the STAR improvement program, all the strategic and operating targets set for 2007 were achieved.

Due primarily to the acquisitions made, the Klöckner & Co Group increased its sales volume by 5.7% YoY from 6.1 million tonnes to approximately 6.5 million tonnes, despite streamlining locations. Driven primarily by acquisitions and price increases Group sales increased from EUR 5.5 billion in 2006 by 13.4% YoY to over EUR 6.3 billion in 2007.

(In EUR million)

Dr Thomas Ludwig chairman of the Klöckner & Co AG management board said that “2008 also began in a very promising manner. Supported by the favorable demand situation and the price increases already implemented, an operating result above the level of the previous year is indicated for the first quarter. As of April 1st 2008 the Klöckner & Co Management Board is extended by Ulrich Becker.” He added that "For the current financial year, we are well positioned. Due to the current development on the market of steel and metal distribution, we expect a favorable result for the financial year.”

Klöckner & Co is the largest producer-independent distributor of steel and metal products in the European and North American markets combined. The core business of the Klöckner & Co Group is the storage and distribution of steel and non-ferrous metals.

Esmark settles lawsuit with Metal Management

Esmark Incorporated confirmed the settlement of litigation pending in state court in New York since June 2007 between its wholly owned subsidiaries, Esmark Steel Service Group Inc and Wheeling Pittsburgh Steel Corporation and Metal Management Inc.

The litigation arose out of a commercial dispute relating to steel scrap purchased by Wheeling Pittsburgh from Metal Management, Inc. By mutual agreement, the terms of the settlement were not disclosed.

Nippon Steel president seeks larger and more global operation

JMB quoted Mr Shoji Muneoka president of Nippon Steel as saying that Nippon Steel seeks sustainable growth as a global player.

He said the firm expands the raw steel output to more than 40 million tonnes while the firm expands the offshore business to serve offshore buyers and transplants of Japanese manufacturers.

Mr Muneoka said the firm tries to improve the cost structure under extremely higher raw materials cost while the firm tries to improve the steel selling price.

PSI BT bags contract from Vallourec & Mannesmann Tubes

The PSI subsidiary PSI BT GmbH announced that it has been contracted by Vallourec & Mannesmann Tubes with the implementation of the production management system PSI metals at its tube mill at Aulnoye in France. Under the contract PSI will supply PSImetals Production Execution System to ensure production quality at the shop floor level.

PSImetals continuously captures controls and monitors all production and quality data and processes in the tube production. Constant, reliable material quality throughout the entire production process and delivering products on schedule are the results of this integrated production management.

Based on a successful specification phase, PSImetals will now be implemented as an integrated production management system in a first project phase for the complete rolling process of seamless tubes. Phase two, covering the heat treatment and several finishing lines, will be implemented separately.

The aims to be achieved are: single tube tracking, online inventory management, quality assurance and a higher level of process control and transparency. In the course of the harmonization of the ERP level the SAP implementation afterwards will be prepared. The implementation is planned for the end of April this year.

PSI BT belongs to the PSI Group and is Germanys leading software solution provider for the Metals Producing Industry in the area of advanced planning & scheduling as well as manufacturing execution.

Cerro Matoso strike ends with losses totaling USD 109 million

BNamericas reports a labor strike organized by employees of the Cerro Matoso nickel complex, owned by BHP Billiton in Colombia, has ended while leaving the company with losses of USD 109 million.

Mr Carlos Barroso, VP of the Sintracerromatoso union, told BNamericas, "The strike ended Monday, after a vote with 479 employees where we counted 450 votes accepting the company's offer, 23 votes to continue the strike and six blank ballots.”

The union leader said the company offered an 8% salary raise in the first year of a new contract and will hire 35 new permanent employees. Each unionized employee was also granted a bonus of USD 4,900.

Employees halted operations on February 27th 2008 due to salary issues and to demand the company hire more permanent personnel.

According to Mr Roger Herrera, president of Sintracerromatoso “Although the strike ended Monday, production will only be able to resume on Wednesday because the company needs to remove the security seals that the ministry placed on the equipment.”

Tenaris completes sale of Hydril pressure control business to GE

Tenaris SA has completed the previously announced sale to General Electric Company of its Hydril pressure control business for a total consideration of USD 1,115 million.

Since its acquisition of Hydril Company in May 2007, Tenaris has integrated Hydril's premium connection business into its core tubular business and managed the Hydril pressure control business separately. The Hydril pressure control business manufactures, sells and services pressure control products and systems that control and contain fluid and gas pressure during drilling, completion and maintenance of oil and gas wells in harsh environments.

Tenaris is a leading global supplier of steel tubes and related services for the world's energy industry and certain other industrial applications.

German state of Saarland allows limited resumption of hard coal mining

Frankfurter Allgemeine Zeitung reported that the German state of Saarland plans to allow the limited resumption of hard coal mining by RAG Steinkohle AG.

The paper said that state issued a complete halt to coal mining in late February after an earthquake induced by mining activities led to severe damage to buildings in the region. RAG operates Germany's eight remaining hard coal mines.

The report, which quoted a statement by the state's government as saying that several studies commissioned by the government as well as RAG concluded mining at the Grangeleisen bed near Saarwellingen can be resumed without danger. The government plans to obligate RAG to repair damaged buildings and reduce the speed of mining.

The report said that a final agreement is to be drafted by June 9th 2008

RAG on March 19th 2008 said it plans to exit hard coal mining in 2012. It said it will not resume mining at its profitable Primsmulde bed.

The sudden halt to hard coal mining in the area could affect German utilities RWE AG and E.ON AG that operate several hard coal fired power plants in Germany.

Korea Zinc in treatment charge talks - Report

Reuters reported that Korea Zinc Co one of the world's largest zinc smelter is in talks with zinc ore suppliers including Canada's Teck Cominco on treatment charges.

A source at the South Korean company said that "Some of the negotiations have been already settled but we are still in talks with many others.” He said that some discussions may be prolonged until the end of April, although differences over the terms of the agreement had been narrowed.

Treatment charges, commonly referred to as TCs, are the fees miners pay smelters to process raw materials into refined metal. Traditionally TC deals are settled at the American Zinc Association Conference in February, but this year no general agreement was reached amid deep uncertainties about the supply outlook.

Metal Bulletin reported last week that Korea Zinc could have reached a TC deal with Teck at around USD 300 per tonne based on a London Metal Exchange zinc price MZN3 of USD 2,000 per tonne coupled with an escalator of 10 cents a pound and a de escalator of around six cents a pound.

Sources with companies involved in the discussions said in February that there remained a wide gap on price ideas, with smelters proposing a rise in fees to between USD 320 and USD 360 a tonne on an LME basis price of USD 3,000 per tonne, while miners seek a cut.

Zambia introduces higher taxes on foreign miners

Reuters reported that Zambia has begun enforcing a new tax code on that will see mining firms pay more in royalties and other taxes despite objections that the government has reneged on tax exemption deals with foreign investors. A minimum 25% windfall profit tax has been enacted.

As per report all foreign firms in the copper rich southern African nation are required this month to start paying the higher taxes. The mineral royalty has increased to 3% from 0.6% while corporate tax on the miners has risen to 30% from 25%. Zambia also has introduced a 15% variable profit tax on taxable income above 8%.

Mr Kalombo Mwansa mines and minerals development minister told Reuters that "There is now a law in place with effect from today. We have a new tax regime for the mines and it is really a matter of the law.” He added that the bigger tax bite has outraged mining firms who have said the move could discourage investment in the sector, a major employer in Zambia accounting for a large share of foreign earnings.

Mr Frederick Bantubonse the head of the Chamber of Mines of Zambia, said the new taxes flew in the face of development agreements that had exempted foreign investors from paying taxes for as long as 20 years in some cases. He said that "This will discourage direct foreign investments because investors will have no confidence in the government if it can not honor signed agreements.”

He added that mining companies might also face problems raising capital for upgrades and expansions of existing copper and cobalt mines in Zambia as a result of the tax changes, which would have a spin off effect on job creation.

Western Canadian Coal approve acquisition of the Falls Mountain Coal

Western Canadian Coal Corp announced that its shareholders have approved at special meeting of shareholders the Company's acquisition of Falls Mountain Coal Inc and the amending of the conversion rate in the related party loan made to the company by its largest shareholder, Cambrian Mining plc.

Upon receipt of the approval the Company has indicated that work will commence immediately in restarting production at Falls Mountain's Willow Creek mine. This will allow the Company to commence producing low volatile PCI coal at a run rate of 60,000 tonnes per month from the Willow Creek mine as early as September 2008 and open the opportunity to increase the Company's Brule mine to operate at 2.0 million tonnes per year of low volatile PCI coal from its current operating rate of 1.3 million tonnes per year.

Mr John W Hogg president & CEO said that "The acquisition of Falls Mountain is the next significant step in the growth of Western Canadian Coal. With record coal prices expected in the upcoming coal year and higher coal prices expected in the next few years, the access to over 13 million tonnes of high quality metallurgical coal provides a tremendous opportunity for the Company."

The Company expects the Falls Mountain acquisition to close in April 2008.

US weekly crude steel production up by 3.4% YoY

American Iron & Steel Industries reported that in the week ending March 29th 2008, US’s raw steel production was 2.144 million net tons while the capability utilization rate was 89.9%. Production was 2.073 million net tons in the week ending March 29th 2007, while the capability utilization then was 86.3%. The current week production represents 3.4 % increase from the same period in 2007.

Production for the week ending March 29th 2008 is up 1.2% from the previous week ending March 22nd 2008 when production was 2.118 million net tons and the rate of capability utilization was 88.8%.

Adjusted YTD production through March 29th 2008 was 26.851 million net tons at a capability utilization rate of 88.5%. That is a 4.9% increase from the 25.588 million net tons during the same period last year, when the capability utilization rate was 83%.

District wise production for the week ending March 15th 2008
1. Northeast Coast: 192
2. Pittsburgh/Youngstown: 220
3. Lake Erie: 85
4. Detroit: 109
5. Indiana/Chicago: 528
6. Midwest: 260
7. Southern: 656
8. Western: 94
(In thousands of net tons)

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

Minara approves AUD 300 million nickel expansion

Perth based nickel miner Minara Resources Ltd announced that it has received in principle approval from its board for a AUD 300 million heap leach expansion project.

This will see the expansion of the company's heap leach project deliver 8,000 to 10,000 tonnes of nickel per annum. The additional capacity will come on stream progressively from late 2009.

The innovative expansion plans include adding a further five heap leach pads which will enable the company to expand up to 1 million tonne per annum under leach, installing a large liquor pre heating circuit and enhancing the existing iron rejection circuit.

Mr Peter Johnston MD & CEO of Minara said that this is a significant investment by Minara delivering a second, low cost, low risk production source enabling the company to maximise throughput of Murrin Murrin's plant capacity. He added that "Our investment in the nickel heap leach project is part of Minara's growth strategy and confirms our confidence in the pilot plant which has been running successfully for 12 months. The heap leach project is the world's first commercial nickel heap leach operation.”

Mr Chavez may support new Maranhao steel mill in Brazil

BNamericas reported that Mr Hugo Chávez president of Venezuela's will analyze a proposal from the governor of Brazil's Maranhao state, Jackson Lago, to work together on the construction of a steel mill in the state.

Mr Chávez was quoted as saying that the Venezuelan government would be pleased to work with the governments of Brazil and Maranhao to build a steel mill.

However, he said that "I cannot promise construction but I can promise that I will speak with Mr Lula soon president of Brazil and added that he will send a team to evaluate the project.

The University of Sao Paulo recently announced it would begin studies in April to measure the environmental impact of installing a steel plant in the capital of Maranhao state, Sao Luís and in Bacabeira city, located 50 kilometer away.

Maranhao in northeastern Brazil, produces and exports nearly 100 million tonne per year of iron for industrialized nations and the plan is to add value in the state itself.

CSC raises HR export price for Q2

After domestic prices were raised by 19% last week, China Steel Corp announced its new export prices for the second quarter up by USD 200 per tonne.

Market participants state that China Steel Corp’s HR, CR, plate and bar prices in the first quarter were USD 140 to USD 200 per tonne less than the international prices. As a result, some of HR price will be increased to about USD 810 per tonne but it is still USD 70 per tonne lower than that from China.

China Steel Corp said that the price increase of iron ore, coal and freight make them under big pressure. After raising the prices, China Steel Corp’s new prices can keep pace with international prices.

(Sourced from YIEH.com)

US galvanized steel prices continue to raise

US galvanized steel price has been rising for three months in a row since the beginning of 2008. It’s said that domestic galvanized steel mills are planning to raise the price again in May and maybe raise it further this June.

Most buyers expected that the price hike will end up soon. Contrarily, most analysts forecasted that the price hike won’t end up until this June and eventually will stop rising in the third quarter. Although the demand is not high, US steel mills still increase hot dip galvanized price based on low stocks, decrease in imports and high raw material costs.

Currently, CGI stock quoted at around USD 1,279 to USD 1,323 per tonne FOB in mid west US. Meanwhile, the price of the same product will be USD 66 more in the west coast.

(Sourced from YIEH.com)

US Steel appoints Ms Grabe as GM business planning

United States Steel Corporation announced that Ms Deborah A Grabe has been named general manager of business planning. She will reports to Mr John C Price who was recently appointed vice president, supply chain.

In her new role, Ms Grabe is responsible for planning and scheduling production at all of US Steel's North American steelmaking and finishing facilities.

Her career at US Steel began in 1988 as a management associate in the company's purchasing department at its Pittsburgh headquarters. After advancing through increasingly responsible roles in purchasing, finishing operations at Mon Valley Works near Pittsburgh, raw materials planning, procurement, distribution and sales and tubular products, she was named manager, raw materials in 2004. In 2006, she advanced to her most recent position, general manager, procurement, at US Steel Kosice where she oversaw all purchasing activities for the company's steelmaking operation in the Slovak Republic.

AK Steel increases prices for SS products

AK Steel announced that it will increase transaction prices for stainless steel sheet, strip and continuous mill plate products in the 200, 300 and 400 series, as well as duplex grades, effective with shipments on April 6th 2008.

The price increases will be accomplished through a two percentage point reduction in the functional discount rate, which equates to an increase in base prices of approximately 4% to 6%, depending upon the grade.

AK Steel said that the price increase is in response to increased demand for stainless steel products, as well as the need to recover increased costs of steel production.

Thessaloniki Port profit up four fold in 2007

Thessaloniki Port Authority reported that its 2007 profit increased nearly four fold as sales increased. Net profit for the year advanced to EUR 13.9 million from EUR 3.64 million in 2006, while turnover rose 44% to EUR 66.28 million.

The port also recently launched tender inviting companies to upgrade and run commercial facilities at its ports in Piraeus and Thessaloniki to boost their role as regional hubs.

The port of Thessaloniki has been touted as an ideal location for acting as a transshipment hub for the Balkans. Among the companies which have been reported as highly interested in assuming control of the container berths in Thessalonica is Australia’s Hutchinson Group.

Coal International H1 loss narrows to GBP 1.7 million

Thomson Financial reported that Coal International Plc loss for the six months ended December 2007 narrowed to GBP 1.7 million from GBP 3 million in same period last year on turnover of GBP 17.2 million up from 7.6 million in 2006.

Coal International said that its turnover rose as a result of increasing sales volume and prices in West Virginia.

LME base metal prices move higher last week

The weakness of the US dollar and the strength of funds for investment are driving all base metal prices on the LME rebound last week.

The three month prices of nickel gained by 3.2% to USD 30,550 per tonne last week. In other metals traded on the LME, the three month price of copper raised by 4% to USD 8,405 per tonne. Aluminum was increased by 3.8% and the three month price of zinc was up by 0.9%.

(Sourced from YIEH.com)

POSCO E&C wins USD 112 million Vietnamese terminal deal

Yonhap reported that POSCO Engineering & Construction Co a construction unit of South Korea's leading steelmaker POSCO Co has clinched a USD 112 million preliminary deal to build an international container terminal in southern Vietnam.

POSCO E&C in a statement said that the container terminal expected to process 1.15 million 20 foot containers a year will be built in Vung Tau, 125 kilometers south of Ho Chi Minh City.

Cleveland Cliffs announces convertibility of preferred stock

Cleveland Cliffs Inc announced that the trading price condition for the conversion right of its 3.25% redeemable cumulative convertible perpetual preferred stock is satisfied and as a result, the preferred stock may be surrendered for conversion at any time during the fiscal second quarter ending June 30th 2008.

The trading price condition was satisfied because the closing share price of Cleveland Cliffs' common shares for at least 20 of the last 30 trading days of the fiscal 2008 first quarter exceeded 110% of the then applicable conversion price of the preferred stock. The satisfaction allows conversion of the preferred stock only during the fiscal 2008 second quarter. Conversion may continue after the fiscal 2008 second quarter if certain conditions set forth in Cleveland Cliffs' amended articles of incorporation are satisfied.

The preferred stock was also convertible during each of the previous 13 fiscal quarters due to the satisfaction of the trading price condition during the applicable periods of the relevant preceding fiscal quarters.

The conversion rate is currently 66.1881 common shares per share of preferred stock. This equates to a conversion price of approximately USD 15.11 per common share, subject to adjustment in certain circumstances including payment of dividends on the common shares. Effective May 15th 2008, the Company will be distributing additional common shares pursuant to its two for one stock split declared on March 11th 2008. As a result, at the opening of business on May 16th 2008, the conversion rate will adjust accordingly.

Beginning January 20th 2009, Cliffs may redeem shares of the preferred stock by paying cash, its common shares valued at a discount of 2.5% from their market price or any combination thereof in an amount equal to the liquidation preference, plus any accumulated and unpaid dividends to the redemption date. Other conditions and terms can be found in the related prospectus dated July 22nd 2004.

Erdemir performance improves after privatization

Zaman reported that, contrary to the apprehension of layoffs and closures ate the time of privatization, Erdemir has done very well after OYAK purchased it 2 years back. Erdemir has not only increased production and profitability but has also made substantial investments and increased employment opportunities. As per report, it has also strengthened position at the stock market.

Some of the highlights are
1. TRL 1.4 billion in net profits in the last 2 years
2. Its stocks rose by 35% during the last 6 weeks, while its market value climbed to USD 6.4 billion. Foreign share at Erdemir's stocks rose to 62%.
3. Erdemir, which had 14,598 staff before privatization, increased this figure to 15,063 by the end of 2007.
4. Total assets of the company rose by 34% to surpass TRL 9.6 billion in the last 2 years.
5. Having paid USD 54.4 million in cash dividends in 2006, Erdemir decided to pay TRL 298 million in dividends this year.
6. Erdemir invested USD 947 million in 2007, while Oyak Group invested USD 2.3 billion in the company within the last 2 years.
7. The flat product manufacture rose from 3.5 million tonnes to 4.206 million tonnes since privatization.
8. It obtained savings of USD 20 million with the increase of labor force productivity.
9. Erdemir also saw a decline in energy consumption by 2%.

Erdemir’s 49% stake was purchased by Oyak Group for USD 2.9 billion.

Qatar Steel to increase production in next 5 years

Doha Times reported that Industries Qatar subsidiary Qatar Steel is boosting production capacity in the next 5 years.

As per report, Qatar Steel is aiming to increase production of rebars by more than 3 fold to 2.55 million tonnes in 2012 from 0.83 million tonnes in 2007. Qatar Steel is expecting a flat 1.75 million tonnes bars production in 2008 and the next 2 years. But with the phase II expansion expected to be completed by the first quarter of 2011, output is poised to grow to 2.15 million tonnes in 2011.

From 0.12 million tonnes in 2007, Qatar Steel is expecting production of wire rod coil to jump more than 154% to 0.30 million tonnes in 2008 and then to remain flat for the next 4 years.

Billet production is expected to reach 2.85 million tonnes in 2012 as compared with 1.15 million tonnes in 2007. Output is expected to be flat at 1.60 million tonnes in 2008-10, after which it will grow to 2.15 million tonnes.

Molten steel output, which is expected to be 1.63 million tonnes during 2008-10, is estimated to reach 2.90 million tonnes in 2012, while sponge iron production is to remain stable at 2.30 million tonnes during 2008-12.

New PM promises to overcome power crisis in Pakistan

Khaleej Times reported that Pakistan's incoming government is planning to produce 2200 MW of electricity during 2007-08 by establishing new units that would reduce the duration of load shedding during summer.

Mr Yousaf Raza Gillani prime minister of Pakistan said that the aim is to overcome the power shortage that is projected to touch the 4000 MW figure next year by widening the supply gape from the present 3000 MW deficit. He added that "The government would take the masses out of darkness by installing new power generation plants."

Mr Gillani said that power crisis is one of the major issues being faced by the new set up. The government would also launch a countrywide power saving campaign under which 500 MW electricity would be saved. He added that "Today, Pakistan is faced with a multitude of crisis including power, water, atta and inflation. We should not tell lie to the masses. We should take them into confidence. I am sorry, but all these problems could not be solved instantly."

Mr Gillani said that the government had launched the Thar Coal project with the aim of producing 5000 MW during the first phase, and now the present government would extend the project's capacity by 20,000 MW. He added that Water & Power Development Authority had also been directed to complete feasibility studies for the construction of major dams so that not only electricity generation is increased but also the availability of water to the agriculture sector through the construction of reservoirs.

Major cities of Pakistan are witnessing 5 to 7 hours of unannounced load shedding while small cities, towns and villages are faced with up to 12 hours of black out every day. The situation is likely to worsen in the peak summer.

Jordan Steel acquires remaining 50% of Jordanian Alliance

Jordan Steel Plc has announced that it signed a purchase agreement to acquire the remaining 50% of the share capital of Jordanian Alliance for Iron Steel Company for a total value of JOD 30 million. It is now wholly owned by Jordan Steel Plc.

Rising steel prices and load shedding hit industry in Pakistan

APP reported that over 100% increase in raw iron prices in the last 3 months, coupled with unprecedented power load shedding, has crippled Pakistan’s local industry and brought production down to barely 30%.

This was observed by agriculture machinery manufacturer Mr Muhammad Iqbal Mughal, auto parts manufacturer Mr Munir Mughal and surgical instruments manufacturers Mr Siddiq Azeem Moghul at a joint press conference. They said that small manufacturers were the worst hit in the present circumstances and asserted that several were facing starvation.

Mr Iqbal Mughal said that "All stakeholders associated with this sector have been badly affected, with high input costs and work in factories grinding to a halt for hours with every power shutdown." He added that the government fixed price of raw iron is PKR 60 per kilogram, but certain profiteers who have monopolized the iron market are selling at exorbitant rates.

Meanwhile, Mr Siddiq Mughal urged the concerned authorities to ensure implementation of the government fixed price of raw iron of INR 60 per kilogram, to save the national industry from total disaster. He added that "Some months ago raw iron supply to the industries in Daska stood at 2000 tonne per month, while now it has dwindled to 300 tonne, while some suppliers are not selling due to the erratic prices."

Punj Lloyd secures USD 68 million order from Tecnimont SPA

Punj Lloyd Limited recently announced that it has received an order from Tecnimont SPA of Italy for an approx value of USD 68 million for Borouge 2 Polyolefins Project of UAE based Abu Dhabi Polymers Company.

The scope of the work involves mechanical work PE3 and PH areas including steel erection, piping fabrication & erection, equipment erection and painting.

Annual truck sales in GCC to reach AED 10 billion – Report

It is reported that the value of annual truck sales in the GCC and the Middle East is expected to increase to a massive AED 10 billion in the next 12 months spurred by heavy demand from the booming construction industry.

As per report, demand for trucks in the region’s construction industry has almost tripled in the past 2 years, led by the massive projects. In a couple of years, the industry expects sales to grow to almost 20,000 trucks per annum.

Mr Anders Schultz area manager of Scania AB for Gulf said that "Sales figures in the 1980s and 1990s were really low. But during the past two years, sales have almost doubled. We expect sales to rise to 1,200 in 2008. Despite the slowdown in the American and European economies, the Middle East has remained vibrant and sales look promising."

To counter the problem, Scania recently announced that once its new production facility at Jebel Ali starts functioning it would begin training programs for aspiring drivers. It has decided to tap into this newly emerged market and start production within the UAE as part of its strategy to strengthen its position in important growth markets.

Mr Schultz said that there is a severe shortage of trucks in the region, especially in Dubai. He added that "The new facility will start its operations in early 2009. It will initially encompass vehicles for construction haulage, such as tipper and concrete trucks, but the facility will also be adapted for future bus chassis delivery."

Suez Canal increases transit tariff

Daily News Egypt reported that Suez Canal Authority will implement its scheduled transit tariff increase starting April 2008.

As per report, transit fees will be raised by varying rates, ranging between 4.2% and 14.1%, averaging 7.1%, based on vessel and cargo type.

The increase in fees is expected to generate an additional USD 300 million, at least, with additional revenues accruing from the rise in trade related traffic. Container vessels traffic constituted 51.6% of total traffic in 2007. The completion of the deepening of the Canal to 66 feet, from the current 62 feet, will allow the passage of bigger vessels, with cargo exceeding 220,000 tonnes.

Suez Canal Authority will continue to offer incentives to transiting vessels to encourage higher use of the waterway. Suez Canal revenues, representing Egypt’s third largest source of foreign currency, had reached USD 4.6 billion in 2007, up from USD 3.8 billion in 2006, on the back of higher non oil traffic.

(Sourced from Daily News Egypt)

No delay by DEWA in delivering utilities to projects – Report

Emirates Business 24/7 reported that Dubai Electricity & Water Authority has delivered power and water supplies to all development projects as requested by developers in Dubai without any delay.

Mr Saeed Mohammad Al Tayer MD & CEO of DEWA said that "Projects do not get delayed due to shortage of power generation capacity. This is because bulk power facilities are built beforehand for all developments provided the developers approach DEWA at the initial stage of their projects."

Mr Al Tayer added that DEWA proactively engages developers and their consultants as its partners to provide DEWA with their plans at an early stage, provide essential requirements of plots and right of ways and keep the public utility informed through updates to overcome associated lead times.

He added that "Failure on the part of a developer to do so may compromise that end. We can quote so many examples of power stations that were constructed purposely for private developments and yet left without proper utilization for long periods of time due to delays of the development projects themselves."

He further added that the current electricity generation capacity of the DEWA system is about 5,000 MW while ongoing projects will commission another 5,000 MW with their associated networks by 2010. He said DEWA’s capacity is expected to increase to 20,000 MW of electricity and 1,000 million imperial gallons per day of water by 2020.

Dubai’s electricity demand is set to reach 5,400 MW in 2008 and will further jump to 8,513 MW and 16,000 MW in 2011 and 2015, respectively. Water demand for 2008 is 250 million imperial gallons per day and will grow to 341 million imperial gallons per day and 800 million imperial gallons per day in 2011 and 2015.

Iran, Azerbaijan and Russia hold railway conference

IRNA reported that Iran, Russia and Azerbaijan have kicked off tripartite conference on railway cooperation in Tehran recently.

The conference is to conduct preliminary survey and studies on running electronic trains connecting Tabriz, Azarshahr as well as construction of new rail track connecting Ghazvin, Rasht and Astara.

Officials from Iran, Russia and Azerbaijan, taking part in the conference, called for expansion of technical and expertise cooperation to help implement JV projects in Iran.

Mr Hassan Ziyari MD of Iran's Rail Road said that north south corridor needs renovation to help boost trade among regional countries. He added that "It is expected to witness landmark progress through formation of expert groups and holding consecutive conferences every 6 month."

Iran, Russia and Azerbaijan republic are located on north south corridor.

Russia to deliver fourth cargo ship to Iran

It is reported that Russia's Volgograd Shipyard has built its fourth double screw dry cargo vessel for Iran, thus fulfilling its contract with Iran. The 4 ship contact had been signed in August 2005.

Fitted with 4 cargo tanks and boasting a total capacity of 10,800 cubic meters, the multi purpose ship meets all the requirements of international conventions. The vessel was designed to transport general and bulk cargo, timber and large size cargo.

According to MNP Group, 3 of the vessels were delivered to Iran's Irinvestship Limited in 2007 and the fourth ship is expected to be handed over to Iran in the near future.

Salam International to build mega tank farm at Aqaba

Khaleej Times reported that Jordan based transportation and trade services provider Salam International Transport & Trading Company will construct a 50,000 tonne tank farm to store chemicals, liquids and other oil products. It has formed a strategic partnership with Al Jaffali Group to undertake the project aimed to enhance the regional investment scene in Aqaba.

Initial construction of the JOD 20 million facilities has already started and it is projected to be operational before the end of 2008. In line with the agreement, a piece of land was chosen for this project, which will be constructed at a prime location at the southern area of the Port of Aqaba, near the chemicals terminal and crude tankers.

Mr Ahmad Armoush founder of Salam International Transport & Trading Company said that "The political stability and inviting investment environments that Jordan enjoys are both factors that make it a hub for regional transportation and business expansions."

Mr Tarek Dajani GM of Salam International said that "Jaffali Group has played a major role in the development of the Saudi Arabian market. It has introduced many new quality products, as well as innovative services and advanced technologies to the country and the region at large."

Founded in the year 1997, Salam International is specializing in shipping, land cargo transportation, real estate development and offers investment solutions to local and regional markets.

Political issues could delay Kuwait refinery

MEED reported that Kuwait's landmark new refinery at Al Zour could be delayed even further, following the resignation of the state's government and the calling of new elections for late May 2008.

Sources involved in the bidding process for the massive USD 14.5 billion, 615,000 barrel a day scheme say that the political situation means the client, state refinery operator Kuwait National Petroleum Company, will find it hard to make key contract awards.

As per report, KNPC has asked bidding firms to extend their bid bonds, which guarantee the validity of their offers, by three months to the end of June. All bidding groups are understood to have agreed to comply with the request.

More than 15 international contractors submitted bids for the re tendered project in December 2007. KNPC has previously said it plans to announce the winners in April 2008, one month later than the original schedule.

Australian regulator blocks Shougang buy of Mt Gibson stake from Gazmetall

It is reported that Australian securities regulators had blocked Chinese steel maker Shougang from acquiring a 20% stake in Australian iron ore minor Mount Gibson Iron Ore Ltd from a Russian billionaire.

The Takeovers Panel ruled that a relationship existed between Shougang and APAC and that there would be an unacceptable effect on the control or potential control of Mount Gibson if Shougang acquired Gazmetall's stake. It said it was canceling the agreement between Shougang and Gazmetall.

Mount Gibson said in a statement on Tuesday it was pleased that its serious concerns had been addressed.

Mount Gibson last month asked the regulatory body to block the sale after Shougang's Hong Kong listed subsidiary, Shougang Concord International Enterprises Co Ltd agreed to buy 19.73% of the Australian firm from Russian Gazmetall. Mount Gibson said the sale should be blocked because Shougang had not informed it that it planned to launch a takeover as required under Australia takeover rules in large stock purchases.

Shougang already owns 18% percent of APAC Resources Ltd, which in turn holds 20.22% of Mount Gibson.

Mount Gibson operates the Tallering Peak mine 175 kilometers east of Geraldton and the Koolan Island mine off the Kimberley coast in Western Australia. It is expected to produce more than 6 million tonnes of iron ore this financial year.

Chinese HRC export price may see corrections

It is reported that export offer for HR coils, which have continued upward movement in the first week of April 2008, and are likely to rise further in the short term, may witness downward adjustment in the near future.

Prevailing HRC offers for June shipment are at USD 875 per tonne to USD 880 per tonne FOB up by USD 15 per tonne to USD 20 per tonne than late March. It is also heard that a tier one steel producer has even shoot up quotation to around USD 890 per tonne FOB basis.

On Shanghai market, commercial HRC in 4.5mm to 11.5mm thickness and 1500mm width was being quoted CNY 5380 per tonne up by CNY 80 per tonne to CNY 100 per tonne from recently. Prices for 1800mm wide material have jumped by CNY 70 per tonne to CNY 5650 per tonne. Low alloyed 1500mm wide HRC goes at CNY 5550 per tonne, 1800mm wide cargo at CNY 5750 per tonne a jump of CNY 100 per tonne to 120 per tonne from early last week.

Taking price for 4.5 mm to 11.5mm*1500mm HRC as benchmark, it will reach CNY 5500 per tonne on Shanghai market. If it is not able to exceed CNY 5500 per tonne, there would be swift downward corrections. However, strength above CNY 5500 per tonne would further bolster the bullish outlook to CNY 5800 per tonne or even CNY 6000 per tonne

Accordingly, export quotations for commodity grade HRC may rise to USD 950 per tonne FOB at most in April and then start to drop to drop. Mysteel conjectures that it would go back to around USD 700 per tonne FOB even if it approach USD 1000 per tonne FOB in next three months.
(Sourced from MySteel.net)

China steel product exports likely to increase in March

XFN-Asia cited Mr Qi Xiangdong vice secretary general with the China Iron & Steel Association as saying that exports of Chinese steel products in March 2008 are expected to rise against February levels.

Mr Qi at a recent conference organized said that the growth in exports would be mainly due to the large gap between domestic and overseas market prices.

Mr Qi said that in 2007, steel products exported to the US fell 23.25% while exports to Southeast Asia rose 53.9%. Exports to the Middle East rose 506.85%.

He said that prices of crude steel and steel products are expected to stay at high levels in 2008 due to rising demand and higher production costs, including the cost of iron ore, coke prices and shipping. Meanwhile, the closure of some small producers could also lead to shortages. He proposed that domestic steelmakers accelerate overseas expansion in both mines and plants, while tapping markets in developing and emerging countries.

He projected China's crude steel output in 2008 at 520 million tonnes to 540 million tonnes up by 6.3% to 10.4%, with steel products output seen at 500 million tonnes to 525 million tonnes up by 7.02% to 12.37%.

Vale plans 10% increase in iron ore sales to China in 2008

It is reported that Brazil's mining giant Vale plans to ship more than 100 million tonnes of iron ore to China this year under term contracts, a rise of 10% from 2007.

Mr Michael Zhu president of Vale China told reporters "We have no scope to increase that amount."

Vale produced 295.9 million tonnes of iron ore in 2007 of which 96 million tonnes were sold in China.

China frees some Australia spot iron ore cargos at ports

Reuters cited industry sources as saying that Chinese authorities have released 150,000 to 200,000 tonnes of Australian iron ore which had been stranded at ports for about a month because of delays in issuing import permits.

The sources said customs officials have recently allowed three buyers to take some iron ore parcels which have been lying at ports since late February or early March.

The sources said that there are more iron ore cargoes stuck at ports.

Although Chinese authorities have denied delaying of import permits for spot iron ore cargos from Australian suppliers, it is seen by industry experts as a move to deter steel makers from buying spot cargos aiming to cool down spot price levels.

China steel output in 2008 may go up by 11.5% YoY

XFN Asia cited Mr Qi Xiangdong vice secretary general of the China Iron and Steel Association as saying that China's steel output will rise 11.5% in 2008 easily outpacing an expected global average increase of 6.8%

Mr Qi while speaking at an industry conference said 2008 will be the 12th consecutive year that China leads the world in steel production. He said that China's steel exports, which hit a record 40 million tonnes last year, would decline this year, but that rising demand from Southeast Asian markets will help sustain exports amid slower sales to North America and Europe.

Mr Qin said “We will continue to work to minimize trade disputes with all countries.”

China Iron and Steel Association said China produced 489.24 million tonnes of steel in 2007 up by 15.66%.

More hostile bids from China ahead

Chinese minerals trader Sinosteel’s hostile bid for Australian iron ore miner Midwest has signaled that now Chinese companies are gearing up to take the gloves off and make a more aggressive play for Western corporations.

Mr Huang Tianwen president of Sinosteel said that if Sinosteel failed in its tilt at Midwest that would not stop it from it making similar bids either here or elsewhere. He said "Every company cannot say it will be always 100% successful."

He added that "Even for Sinosteel in this kind of takeover there are two outcomes. For other companies in China, it's the same. Whether it is successful or not, it will not affect Sinosteel in the future."

Mr Huang said that more hostile takeovers in future by Chinese companies would be quite possible and quite normal. On March 14th 2008 Midwest told shareholders to take no action until it had an opportunity to consider the offer.

Sinosteel lodged its bidder statement recently for its USD 1.2 billion hostile tilt at West Australian iron ore hopeful Midwest. Rhe document contained little beyond the confirmation of an all cash bid a basic description of Midwest and Sinosteel's operations and an outline of the risks faced by stock holders. Sinosteel has had a joint exploration agreement with Midwest since 2005 to explore one of its sites, a deposit of haematite at Weld Hills.

Vale eying more iron ore pallet ventures in China

Mr Michael Zhu president of Vale China told reporters that Vale is in talks to set up several iron ore pellet plants in China, including ones in northern cities of Rizhao, Anyang as well as Caofeidian.

He declined to disclose the size and investment.

In January, Vale started operation of a pellet plant in Zhuhai in southern Guangdong province with an annual capacity of 1.2 million tonnes.

Shougang calls for government role in overseas takeovers

While reacting to the decision of Australian securities regulators blocking Chinese steel maker Shougang from acquiring a 20% stake in Australian iron ore minor Mount Gibson Iron Ore Ltd from a Russian billionaire, Shougang has expressed serious concerns and called for intervention of Chinese government.

Mr Wang Shuanghong director of Shougang Corporation Resources Office said that Chinese firms are running up against obstacles because of their rush to expand aggressively to control more resources overseas.

He told a conference in Beijing that "This has led to some panic reactions in some societies overseas. Some of the facts are very complicated. It is not only a problem among the companies but also linked to political problems, especially the concept of China as a threat, which has arisen this year with the development of Chinese enterprises.”

He urged that "The Chinese government should communicate to establish a peaceful environment for investment by Chinese companies.”

He however added that Chinese corporations should be cautious about how they choose takeover targets."

Chinese steelmakers and commodity traders are keen to cut dependence on Rio Tinto Ltd and BHP Billiton Ltd amid rising prices for the bulk commodity and have been forming joint ventures with junior iron ore companies. Sinosteel Corporation, China's largest iron ore trader, has gone one better and launched a AUD 1.2 billion hostile bid for WA iron ore miner Midwest Corporation.

Sinosteel MECC’s contract for MSPL pellet project

It is reported that a few days ago, Sinosteel Equipment & Engineering Company received the advanced payment of the annual 1.2 million pellet project from MSPL Limited. Through hard efforts, Sinosteel MEC has formally turned the above contract signed with MSPL Limited in January 2008 in operation.

According to the contract, Sinosteel MECC, as the general contractor, should be responsible to producing an advanced and efficient product line of annual pellet ore outputs of 1.2 million tonnes for MSPL within 16 months.

This project is the first large-scale pellet construction project undertaken by Sinosteel MECC overseas. Sinosteel MECC has realized the breakthrough in foreign metallurgical engineering markets with the successful implementation of this contract.

Chinese pig iron exports in February 2008

According to the recently released information by Chinese custom authorities, Chinese pig iron export during February 2008 amounted to 39,402 tonnes.

In tonnes

Large coalmines account for half of Chinese coal output

According to a report published by the National Development and Reform Commission large coal enterprises groups have kept growing strong and big in 2007 and coal enterprises with annual sales revenue exceeding CNY 300 million mined 1.29 billion tonnes of coal in the year accounting for over half of China's total raw coal output.

The report also shows that coal enterprises with annual sales revenue exceeding CNY 300 million accounted for three fourths of the main operating income and 70% of the gross profit of large scale coal enterprises in China in the year.

Statistics show that China's coal output reached 2.536 billion tonnes in 2007 up by 6.9% YoY; coal consumption, 2.58 billion tonnes up by 7.9% YoY; and coal export, 53.17 million tons and import, 51.02 million tonnes, leaving a net export of 2.15 million tonnes.

The report points out that China's coal industry is still in a rehabilitative development period, and coal enterprises still face many difficulties:
1. The irrational mining structure and low level technology and equipment
2. The increasing pressure of resources and environment protection
3. Rapid growth of production cost of coal as policy cost keeps increasing and many problems left over by the history.

Chinese domestic prices in March up by 23% YoY

According to China Iron and Steel Association, China's steel prices increased by 23% YoY in March compared with the same period of the previous year.

According to analysts the rising price is mainly resulted from the growing domestic demand and rising costs of raw materials, including those for iron ore and coal coke.

The government has been striving to eliminate the outdated capacity, but the deployment of the newly developed production capacity has not been on the place. Moreover, the reconstruction after the severe winter whether and rising investment in the real estate all pushed up the steel demand.

The report added that since the benchmark price for iron ore was settled, at least 57 domestic steel mills have increased their prices. Baosteel, China's leading steel manufacturer said in February that it would increase the steel prices by as much as 20% for the second quarter of 2008.

High iron ore prices to help in obsolete capacity elimination in China

XFN-Asia cited Mr Jia Yinsong an inspector with the economic operations bureau of the National Development and Reform Commission as saying that China should take advantage of the increased price of iron ore to eliminate smaller, dirtier and less efficient steel producers.

Mr Jia said 'We need to continue to retire outdated capacity. There is tremendous pressure on Chinese steelmakers from rising raw material costs. We need to nurture larger steelmakers to help them consolidate and more efficiently use resources and reduce emissions. He added that higher raw material costs should be seized as an opportunity to retire less efficient, higher energy consuming steelmakers.”

Mr Jia was less than optimistic when asked if he was confident the government would be able to retire the bulk of low capacity, inefficient steel mills by 2010. He said “Local phase out are going slowly and it is very difficult. More macro measures will be taken. Water and power pricing measures will favor larger, more efficient producers.”

He said the property sector and the construction industry as a whole which together consume over half of China's total steel output were in large part responsible for rapid capacity expansion and investment in the steel industry.

Mr Jia said “Investment growth and credit extension in China is too fast, it's alarming. We need to control it. Property investment alone was up by 29.2% last year which bolsters capacity expansion by Chinese steelmakers. He said the country would continue to discourage large scale exports of steel to reduce over reliance on external demand and avoid trade frictions with key partners.”

Mr Jia said “There is still a huge price gap between average global steel prices and domestic prices. But since January, Chinese policy has helped limit steel exports and this policy will continue. But international demand is a huge factor and there will be a huge attraction to seek profits, so we must continue to control large volume exports of steel.”

He said “We don't want to return to high volume steel exports. HReduced exports and continued strong domestic demand will help keep steel prices in China at healthy levels. He also said that Chinese steel output was up 70 million tonnes in 2007, but this year output will increase more slowly so prices will be more stable than last year.”

Chinese coal contract price hike may exceed 90%

It is reported that coal price in China has presented overall upswings since March 2008 as market insiders forecast coal enterprises will benefit a lot as coal contract price will increase over 90% in the price negotiation.

As per report during the ongoing negotiation between Japan and Australia, both sides have agreed with a preliminary 100% price advance. According to usual practice, contract price for China's coal will modestly exceed that for Australian ones due to geographic proximity.

Mr Han Yong an analyst with China International Capital Corporation Limited said contract price for China's coal will gain more than 90%. As 2008 price will be implemented from April 1st 2008 a 90% price advance can be translated into a 70% hike for average export price this year.

China National Coal Group Corp, China Shenhua Energy and Yanzhou Coal Mining contribute 20.25%, 12.47% and 7.6% respectively of total coal exports. China National Coal Group Corp. is expected to become the largest winner.

China's coal exports keep declining. Last year the first batch of export quota accounted for 60% of the total amount of the year. As per the proportion, the first batch in 2008, 31.8 million tonnes, implies total quota of some 53 million tonnes in whole this year down 17 million tonnes from the 70 million tonnes in last year. The figure goes in line with actual exports in 2007.

QPSS to sell 20% state owned shares for funding CR expansion project

It is reported that Qingdao Pohang Stainless Steel Company Limited has listed on Qingdao Equity Exchange to transfer 20% state owned shares for a reference price of CNY 169.75 million with the purpose of promoting the steelmaker's cold rolling expansion project.

According to Qingdao Equity Exchange, QPSS has total assets of CNY 1702.787 million gross debt CNY 854.037 million and ownership interest CNY 848.75 million. QPSS funded USD 180 million in the phase 1, introducing in advanced equipments and techniques from France, Germany, Belgium and South Korea, scheduling to produce 180,000 tonnes CR stainless a year.

QPSS noted that the transferee of its 20% state owned shares must consent to participate in the CR expansion project and fund USD 6 million to make a warrant to USD 26 million bank loans.

The transferee is required to have registered capital of no less than CNY 1 billion net asset of above CNY 1.5 billion and good credit. Further, it should not be a stainless manufacturer to prevent leaking of technology.

The cold rolling expansion project was agreed between POSCO and Qingdao Iron & Steel Group Co, the two shareholding parties and approved by the government in 2003. In December 2007, POSCO decided to make the investment.

Ansteel develops welded gas cylinder steel

It is reported that recently, Ansteel has successfully exploited welded gas cylinder steel plate HP345 which is a high tech and high value added variety steel in 1,780mm hot strip production line in the second smelting steel rolling plant. After the inspection, all the performances met the national standards.

Baotou net profit in 2007 up by 55% YoY

As per a report released on rare earth business by Baotou Iron and Steel Corporation, its operation revenue amounted to CNY2.5 billion in 2007 with CNY308 million net profits up by 55.33% and 325.84% separately.

The annual report disclosed that the company will rely on the advantage of research and development of Rare Earth Institute to exploit downstream products, optimize the industrial chain, and construct rare earth materials, scientific research and the application of materials three parks. In 2008, Btsteel’s rare earth company plans to achieve sales revenue of CNY 3.5 billion.

On the risks, the report pointed out that this year, China implements 15% to 25% export tariff on some rare earth products and renminbi continues to appreciate, these have certain effect on rare earth products’ export. At the same time, the product chain of the company will extend, from e neodymium oxide, praseodymium neodymium oxide products to metal neodymium, metal praseodymium neodymium products, the price change of these products will affect the company’s outstanding achievement. Btsteel’s rare earth company will be concerned about the price trend, timely adjust the supply volume in the market and eliminate the adverse factors.

Chinese ferromanganese exports in February 2008

According to the recently released information by Chinese custom authorities, Chinese ferromanganese export during February 2008 amounted to 14,174 tonnes.

In tonnes

China to invest in regional special iron and steel enterprises

According to Mr Chi Jingdong vice secretary general of China Iron and Steel Association China is inclined to develop regional special iron and steel enterprises especially large iron and steel corporation.

Mr Chi said that the members of CISA completed CNY 803.7 billion investment and made CNY 1,104.1 billion gross profits in the 2001 to 2007 periods. He said that the profits made by top ten iron and steel enterprises accounted for 55.76% to 64.68% of the total, especially in 2005 when the price of steels fell sharply.

Mr Chi said some iron and steel enterprises suffered losses, while the profits made by these ten enterprises accounted for 64.68% of the total, which meant these enterprises are stronger than other enterprises in fighting against risks.

Statistics showed that China's iron and steel industry completed CNY 1,249.21 billion investments in fixed assets in the 1996 to 2006 period up by 14.84% annually, while the production capacity of pig iron, crude steel and steel products grew over 20% in the 2001 to 2005 period.

Jiugang HongXing 2007 net up by 60% YoY

According to the annual report released by Jiugang HongXing on April 1st, the operating revenue of the company in 2007 reached CNY 22.319 billion up by 58.47% YoY, the net profit was CNY 798 million, up by 63.95% YoY income of per share was CNY 0.88.

The report said that the main reason for the increase of main operating revenue is the effectively increase of the output and sales volume, the reason for the increase of net profit is the increase of steel prices.

In 2008, Jiugang HongXing Company plans to produce 5.6 million tonnes iron, 5.9 million tonnes steel, 3.6 million tonnes materials to realize operating revenue of CNY 20.billion

Chinese state grid electricity sales in 2007 up by 27% YoY

It is reported that China's State Grid sold 212.96 billion kilowatt hours of electricity in 2007 surging 26.39% from a year earlier.

According to an annual report of China's electricity market released by State Grid Corporation of China the power generation right transaction involved 53.6 billion KWH of electricity, 6.16 million tonnes of coal equivalent were saved and 143,000 tonnes of sulfur dioxide emission were reduced.

As per report last year, the State Grid set up three levels of electricity trade markets, respectively national, regional, and provincial, with trading forms varying from bilateral negotiation to high low match. The power generation right transaction was mainly the replacement of small thermal power generators with efficient, environment friendly and energy saving generator units.

Across region and across province electricity trade amounted to 322.262 billion KWH in 2007. The State Grid allocated 1.165 billion KWH of hydropower, nuclear power, and coal fired power through its platform, to ease supply shortages in Central China like provinces of Hubei, Hunan and Sichuan.

Inner Mongolia aims to close 15.52 million tonnes coke capacity

According to the economic committee of Inner Mongolia Autonomous Region that the province closed down 75 coking mill, involving backward capacity of 4.6 million tonnes in 2007 on top of the elimination of 6.12 million tonnes in 2006.

According to the blueprint, it aims to further weed out 4.6 million tonnes in 2008 and next, so as to bring the accumulative eliminated volume to 15.52 million tonnes for the 11th five year plan period.

General Steel Q4 of 2007 profit up by 531% YoY

General Steel Holdings Inc one of China's leading non state owned steel products producer announced its results for the fourth quarter and year ended December 31st 2007.

It net sales for the Q4 of 2007 up by 531% YoY to USD 268.2 million compared to USD 42.5 million for the same quarter in 2006. Net income increased to USD 12.1 million

In USD million

Mr Henry Yu CEO & chairman of General Steel Holdings Inc said "We continued to experience solid growth as evidenced by our ability to make successful acquisitions and deliver measurable revenue growth. Our 2007 revenue more than quadrupled the prior year. The pipeline of potential acquisitions remains strong as we continue to grow organically and expand our customer base. He said that we are well positioned to capitalize on what we believe is the beginning of a long term, secular growth opportunity in steel production. He added that our proven strategy to grow through aggressive mergers, joint ventures and acquisitions brings us closer to our vision of becoming one of the largest non government owned steel companies in China."

East West gas pipeline to add second main source in 2009

It is reported that China's West East trunk gas pipeline line is expected to have a second key reservoir soon with the development startup of Dina-2, China's largest condensate gas field.

Dina-2 located in southern Xinjiang has 175.218 billion cubic meters of cumulative proven natural gas reserves and 13.389 million tonnes of proven condensate reserves, which make it the second gas field with reserves over 100 billion cubic meters in Tarim after Kela-2, the West East pipeline's current main sources.

CNPC plans to complete the production buildup of Dina-2 gas field by June 2009, by which time it will be ready to supply natural gas to the west east gas pipeline. Upon completion, Dina-2 is expected to produce 4.5 million tonnes per year of oil equivalent, which breaks down to 5 billion cubic meters per year of natural gas and 560,000 tone per year of condensate oil.

Fujian Province discovers large coal reserves

It is reported that Fujian province 197 geological departments recently discovered a new large scale coal mining area near Tian Hushan and the initial forecast of coal resources is estimated to exceed Tian Hushan mine.

The new proven mine locates in the lower part Tian Shanhu’s Shang Yao mine, in the existing 8 coal targets, 6 coal resources have been tested by drill, there into, the coal resources of west coal of Shang Yao mine and east of the lead coal mine are predicated to exceed 29 million tonnes and can reach a maximum of 63 million tonnes.

According to the expert analysis, this new coal bed appeared underground of Tian Shanhu coal mine and these coal beds are all high quality anthracite. It is good for power, chemical and civilian.

As per report, in accordance with the existing design production capacity, the new discovered mine can maintain 50 years exploration. With further exploration, its coal resources may be larger than that of the forecast.

Ferrexpo preliminary results for 2007

London listed Ukrainian iron ore producer Ferrexpo announced its 2007 result.