Jharkhand Forum urges state to put MoUs on hold

The Telegraph reported that a forum of social activists, small scale entrepreneurs, economists and independent writers today demanded that all MoUs signed by Jharkhand government be put on hold till all existing sick and closed industrial units in Jharkhand were fully revamped.

The group, calling itself Jharkhand Alternative Development Forum, stressed that it would soon come out with a people’s development plan to meet the hopes and aspirations of the people of the state. The resolution said a committee comprising social activists and to be headed by Mr Ram Dayal Munda former VC of Ranchi University would draw up a people’s plan in consultation with local residents that would ensure the active participation of the beneficiaries in the developmental process.

The forum further demanded that no new industry should be allowed to be set up anywhere in the state till all those previously displaced by giant industrial and irrigation projects were fully rehabilitated. It stressed that the state rehabilitation policy being framed should contain provisions of granting shares to the displaced population in the industries set up on their land.

Mr PP Verma convener said that the existing state model has failed miserably. He added that "We will draw up suitable models in consultation with the people concerned. Once we are ready, we would implement these models on a pilot basis."

Prominent economist, Mr Aseem Shrivastava expressed concern on the collapse of the rural economy. Social activist Mr Sanjoy Bosumullik alleged that the current state policy is not only anti people but is also against nature.

Jharkhand government has signed more than 50 MoUs with national and international players mostly in the iron and steel and power sectors.

AP sets up panel to review steel prices

BL reported that Andhra Pradesh Government has set up a special panel to review the prices of steel periodically and fix prices according to its availability in the market. Concerned over the spiraling prices of steel and the impact on the construction activities in the state, Dr YS Rajasekhara Reddy chief minister of AP took this decision.

Consequently, the chief engineers’ panel with Mr Kondal Rao will meet on the 5th of every month and according to the quotations received from steel majors such as TATA Steel, RINL, SAIL and other steel units fix a rate at which it would be available in the open market.

The recommended rate would be communicated to the relevant departments and after consultation with the finance department, a GO would be issued. This rate would be applicable for a month.

RINL inaugurates sinter plant MIS software system

Mr PK Misra director operations of Rashtriya Ispat Nigam Limited has inaugurated the ‘SP-MIS’ software system, which takes care of the entire Sinter Plant MIS needs.

The software was developed by a group of IT engineers consists Mr P Chandra Sekhar, Mr JP Dash, Mr V Hema Sundara Rao and Mr V Srinivasa Reddy.

Mr P Kondaiah GM (IT) has briefed the usefulness of the system. The welcome address was given by Mr Karuppa Swamy head of sinter plant and Mr NNG Mastan Rao proposed the vote of thanks.

Smaller construction firms worst hit by steel price hike

BL reported that the mounting price of steel is likely to impact construction companies, especially those that have a higher proportion of fixed price contracts and also real estate developers.

Profit margins of larger infrastructure companies have reasonably withstood input price pressures, as they usually have inbuilt price escalation clauses in their contracts. Smaller construction players that execute contract work may feel the brunt of the hike as very few command favorable price terms with the project owner.

Steel accounts for a large chunk of cost for residential and office buildings. Unlike infrastructure developers, real estate players seldom have any agreement with the end users for raw material price hikes.

RKKR Steels launches new TMT line at Tiruvottiyur

RKKR Steels has recently announced the launch of its Thermex steel bars with technical collaboration from HSE Germany.

RKKR Steels has its rolling mills at Tiruvottiyur in Chennai, where it has set up the patented quenching system. The capacity has been doubled to 100,000 tonnes a year to meet the growing demand from the construction industry.

Thermex is one of the two patented technologies to manufacture thermo processed bars worldwide.

HZL cuts zinc price by INR 2,300 per tonne

Hindustan Zinc Limited announced that it has slashed prices by INR 2,300 per tonne or 2.1% to INR 104,800 per tonne with effect April 17th 2008.

HZL kept its lead prices unchanged at INR 131,300 per tonne

Timken India to become global manufacturing hub for bearings

It is reported that Timken India Manufacturing Private Limited, a wholly owned subsidiary of the USD 5.2 billion Timken Company in the US, will soon become the sole manufacturing hub for about 70% of varieties of the bearings produced.

The first phase of Timken India Manufacturing Private Limited with an annual capacity of 310,000 bearings will be completed by October 2008. The second phase will be operational by April 2009 and add another 420,000 units. Initially, more than 80% of the products manufactured would be exported to Timken’s plant across the globe and to several customers, including Caterpillar and Terex.

Mr James W Griffith president & CEO of Timken said that the USD 25 million Chennai plant would help the global company achieve its core strategic objective of accelerating growth in industrial markets in Asia. He added that "Timken already has another subsidiary company in Jamshedpur called Timken India Limited and the success of this facility gave us the confidence to make this investment."

Mr Sanjay Sinha GM of Timken India said that "Every product coming out of the assembly line is already sold to customers. The order book is full for the next 11 months."

Timken also has Global Technology Centre in Bangalore supporting more than 30% of the global IT related services. In addition the centre provides accounting both payables and receivables for the headquarters and also offers design, engineering and testing services. Besides manufacturing bearings, Timken has also been sourcing several components including turned rings and housings from India for its global operations.

Indian Railways RWF 2007-08 turnover up by 7.8% YoY

Bangalore based Rail Wheel Factory has registered a 7.8% YoY growth in its turnover to INR 541 crore during year ended March 31st 2008. RWF, which is the sole manufacturer and supplier of wheels and axles to the Indian Railways, has showed an improvement of 16.5% YoY in wheel production by producing 147,007 wheels, which is a new record.

During the year, RWF produced 52,870 axles. This was achieved in just 9 months of the year. The axle shop was shut down for 3 months for maintenance. The month of March 2008 witnessed a highest monthly production of 688 wheels per day. It has also produced 40,509 wheel sets during 2007-08.

For the year 2008-09, RWF has set a target of achieving 200,000 wheels and 84,000 axles. It is also aiming at a growth of 10% to 12% in its turnover to INR 600 crore during the present financial year.

Ghodawat to invest for manufacturing wind turbines

Ghodawat Industries India Limited has announced that it proposes to invest INR 100 crore for manufacturing 1.65 MW turbines by 2009.

Mr Shrenik Ghodawat MD of Ghodawat Industries said that "We are investing INR 100 crore in the first phase for manufacturing of turbines and for R&D. Wind turbines to be manufactured at Kolhapur, will have an initial production of 1.65 MW wind turbines in 2009."

Ghodawat Industries is foraying into wind turbine manufacturing in association with leading energy technologies company, American Superconductor Corporation. It will utilize AMSC's proprietary WT1650 wind turbine design, technology and core electrical components to begin manufacturing complete wind turbines for use in India and for export to countries in the Middle East, South Asia and Africa.

Ghodawat Industries has been manufacturing wind turbine towers in its state of the art facility in Kolhapur for customers such as Suzlon, Vestas and Enercon.

Industrialists call for 35% AD duty on Chinese goods

Exim News Service reported that industrialists have called upon the union government to impose a 35% anti dumping duty on capital goods imported from China to offset the indirect subsidy that the Chinese provide their industry by way of a fixed exchange rate.

A delegation comprising Mr AM Naik chairman of Larsen & Toubro, Mr Dilip Chenoy director general Society of Indian Automobile Manufacturers and Mr Ravi Kant MD of TATA Motors met union finance minister Mr P Chidambaram and explained to him the need for such a measure to counter the slowdown in industrial production.

The industrialists stressed that the industry had been hit by the appreciation of the rupee against the dollar, and had seen its cost competitiveness falling steeply due to the fixed rate of exchange of the Chinese currency against the dollar. They calculated that this worked out to a 30% indirect subsidy for manufacturers in China.

The meeting assumes significance against the backdrop of the industry growing by just 5.3% in January 2008 as compared to 11.6% in January 2007. The growth rate for the ten months of 2007-08 works out to 8.7% as compared to 11.2% in the same period of 2006-07.

SER plans INR 569 crore CAPEX

BS reported that South Eastern Railway has lined up an investment of INR 569 crore in 2008-09 for various projects like doubling of tracks, setting up new sidings for loading and unloading, signaling and also passenger amenities. This apart, SER is also planning to go ahead with a major project which is set to boost its coal loading by around 36 million tonnes per annum.

Mr AK Jain GM of South Eastern Railway said that "We are looking to build a 74 kilometer long track which will connect Mahanadi Coalfields Limited with the most suitable railhead. This project would be commissioned within 4 years and it is expected to bring an additional coal traffic of 36 million tonnes per annum for SER."

In January 2008, South Eastern Railway has completed the broad gauge conversion project between Bnkura and Rainagar and broad conversion project between Baripada and Bhanjpur was commissioned in February 2008.

WB to commission 100 MW green power units by 2009

BS reported that 10 renewable energy projects with a composite capacity of 100 MW are likely to be commissioned in West Bengal by the end of 2009. Among these 10 projects includes the proposal to set up a 50 MW wind park project and a solar park with a capacity of 26 MW.

Mr SP Gon Chaudhuri director of West Bengal Renewable Energy Development Agency said that "The wind power park is to be set up in Dadanpatra in East Midnapore district at an investment of INR 300 crore. Out of the composite capacity of 50 MW, Suzlon will be contributing 40 MW and the rest will come from other players. The project requires 700 acres of land which has already been identified. The solar park to be set up in Purulia by 2010 will have capacity of 26 MW."

Mr Chaudhuri said that private players like Reliance Power and US based Azure Solar Power were keen on setting up solar power plants near Purulia. The balance 24 MW of green energy would come from other renewable energy sources like micro hydel power, biomass and municipal solid waste.

He further added that West Bengal Renewable Energy Development Agency is in talks with IL&FS Infrastructure Development Corporation for undertaking municipal solid waste projects but did not share details. The overall renewable energy potential in West Bengal was estimated at around 10,000 MW while installed capacity of renewable energy in the state was 76 MW, with solar power contributing 7MW.

Electrotherm to issue 1.3 million shares to German firm DEG

Electrotherm (India) Limited has announced that it would issue 1.3 million shares to German financial institution DEG on a preferential basis. Electrotherm shareholders approved the proposal at an extra ordinary general meeting.

The preferential issue will be made at a price not less than INR 600 per share. At the maximum price, this could fetch the company around INR 800 million. However, the shares prices including premium are yet to be decided.

The meeting, which was held on March 28th 2008, also authorized the board to qualified institutional buyers allotment of shares for an aggregate sum not exceeding INR 3 billion. Electrotherm has also made a preferential issue of shares to ICICI Venture Fund and International Finance Corporation in the past.

Electrotherm has 3 divisions namely engineering, steel and electrical. The engineering division manufactures induction, melting and refinancing furnaces, heating and hardening equipments used in steel and foundry industry. The steel division manufacturers TMT bars construction and stainless steel, besides structural steel and DI pipes, while the electric vehicle division makes electric scooters.

CERC asked UPPCL to clear dues or face supply cuts

It is reported that Central Electricity Regulatory Commission has ordered the Uttar Pradesh Power Corporation Limited to clear its arrears for over drawing from the inter state grid.

CERC has directed UPPCL to clear its dues in 6 equal installments of INR 128 crore per month each, starting from May 2008. If UPPCL fails to comply with the orders, CERC plans to direct the Northern Regional Load Dispatch Centre to curtail power supply to the utility without further proceedings. CERC has asked the NRLDC to keep it informed about the payment status of UPPCL with respect to the UI pool account.

Mr Ravinder chief engineering at CERC said that "This is an unprecedented situation, which threatens discipline among stakeholders in the sector as a whole. We will ask NRLDC to take action if UPPCL defaults on any of the payments."

Over the last 6 months, UPPCL paid a total UI amount of INR 190 crore, while the charges for over drawing power during the same period were INR 360 crore. The principal amount overdue from the state as on March 31st 2008 is INR 767 crore.

South Eastern Railway 2007-08 freight earnings up by 12% YoY

In 2007-08, South Eastern Railway has loaded originating freight traffic of 111 million tonnes up by 12% YoY as compared with 99 million tonnes in 2006-07.

The share of iron ore was the largest with 67.3 million tonnes in 2007-08 up by 16% YoY as against 56.3 million tonnes in 2006-07. The earnings from the freight is recorded at INR 5,443 crore up by 12% YoY as against INR 4,877 crore.

South Eastern Railway handled 185.7 million passengers up by 3.8% YoY as against 178.9 million and 345,000 tonnes of parcel up by 21% YoY as against 285,000 tonnes. The earnings from passenger services amounted to INR 721 crore up by 12% YoY as against INR 644 crore and earnings from parcel was INR 63 crore up by 19% YoY as against INR 53 crore.

Tollygunge to New Garia metro extension moves ahead

It is reported that the centre, jointly with West Bengal government, is extending the metro from Tollygunge to New Garia.

The project, sanctioned in 1999-2000 and covering 8.60 kilometer, is making progress. It will have 6 stations of which 5 are elevated and 1 on the surface. The cost has been revised to INR 1,032 crore in October 2007 from INR 907.69 crore at the time of sanctioning. Metro Railway Kolkata has taken up responsibility for land survey and acquisition.

A spokesperson from Metro Railway Kolkata said that the centre, as the implementing agency, was taking 67% stake on the project cost, with the state sharing one third. He added that the fund did not include the cost of seven new rakes costing INR 200 crore, ordered by ICF Chennai for running trains in the extended portion.

The New Garia will be constructed on the surface structure and the other 5 are on an elevated structure over Tolly Nullah. The section will be an elevated structure and alignment will run along Tolly Nullah. The extension will bring South 24 Pargana districts closer to Kolkata's central business area and reduce pressure on Sealdah's south suburban section.

Rites Limited has been awarded the contract. The overall progress of civil engineering works so far is more than 90%. The spokesperson stated that the railways had decided to commence limited services up to Naktala station by September 2008. The whole expansion is tentatively expected to complete by 2009 end.

NHPC and UJVNL in fray for Lakhwar Vyasi project

It is reported that, after the centre declared 420 MW Lakhwar Vyasi as national project, National Hydro Power Corporation and Uttarakhand Jal Vidyut Nigam Limited are the 2 major contenders in the race to clinch the final deal.

Centre has so far remained non committal regarding the allotment of the project, which is hanging due to paucity of funds for the last 20 years. An investment of nearly INR 3,000 to INR 4,000 crore is proposed in the project.

Sensing that the NHPC was preparing the revised detailed project report of the project, UJVNL has intensified efforts for the allotment. The allotment process for the Lakhwad Vyasi, which will benefit several northern states like Delhi, Haryana and Uttar Pradesh, got hotter after centre declared it as a national project and promised to bear 90 per cent of its cost following techno economic appraisal of the DPR and investment clearance by the Planning Commission.

After Uttarakhand came into being in 2000, the state government handed over the responsibility of preparing the revised DPR of the multipurpose project, being built on the river Yamuna, to NHPC. Once the project is completed, it would likely produce 927 million units of power besides irrigating 40,000 hectares of land through east Yamuna canal.

The construction of the project initially started in 1979 by the Uttar Pradesh irrigation department. But due to paucity of funds, the project could not see the light of the day. There is going to be 200 meter high arch gravity concrete dam, underground power house with 2.7 kilometer long headrace tunnels.

Essel and Ess Dee Aluminum join global race for Rio Tinto unit

It is reported that two Indian companies namely Essel Propack and Ess Dee Aluminum have joined a global race to acquire the packaging unit of Rio Tinto Alcan, who would sell the USD 5 billion packaging business as part of a move to focus on core areas.

Essel and Ess Dee are joining hands to share the financial burden of bidding for this large unit, the personal care and pharmaceutical packaging units alone have combined revenue of around USD 1 billion or INR 4,000 crore. The joint bid is also being planned so that the 2 companies may split Rio Tinto’s unit subsequently, to merge with their own areas of operations.

Morgan Stanley, the financial advisor to Rio Tinto, had suggested dividing the packaging unit to make it easier for interested companies and private equity firms to bid. Buyers could more likely be keen if the packaging division is broken up and offered for sale as smaller entities, the advisor is reported to have indicated.

Although the INR 1,194 crore Essel Propack is one of the world’s largest specialty packaging company, it has a relatively smaller presence in the personal care packaging segment. For Ess Dee Aluminum, the deal would boost its market share in the pharma packaging business that currently sees total annual sales of around INR 2,000 crore in India alone.

RIL may form JV with BHEL for solar units

ET reported that Reliance Industries Limited and Bharat Heavy Electricals Limited are in talks to form a JV for setting up solar fabrication units. While RIL is scouting for partners for setting up 2 fabrication units, BHEL is looking for a strategic partner to venture into equipment manufacturing for solar power.

Mr K Ravi Kumar CMD of BHEL said that "We have received a communication from the Prime Minister’s Office in this regard and may go in for a JV with Reliance Industries."

The proposed JV is likely to venture into manufacturing of other small and medium equipment for solar power apart from the solar photo voltaic cells. The JV would also look for small and mid sized acquisitions in the international market for solar power.

The partners in waiting have not finalized the financial and technical details for the proposed JV and would firm up the plans in the next couple of months. The JV company would be eligible for capital subsidies and tax concessions for the solar fab units, a cost of INR 11,631 crore. The solar unit is proposed to be set up at Jamnagar in Gujarat.

OVL to sign agreement with Petroleos de Venezuela

ONGC Videsh is scheduled to sign an agreement with Petroleos de Venezuela SA to acquire 40% stake in the San Cristobal oilfield in Venezuela. The remaining 60 per cent will be held by PdVDA.

The 2 companies will form a JV company to develop the field from its current production level of 20,000 barrels per day to 40,000 barrels per day. OVL will make a total investment of USD 355.738 million comprising signature bonus of USD 173.1 million for the stake.

Besides, ONGC will also be required to sanction a loan of USD 355.74 million for the project that covers 160.16 square kilometer and is located in Junin in the Orinoco Heavy Oil belt of Venezuela.

Kirloskar Brothers bags LoA for Koderma power project

Damodar Valley Corporation has issued a letter of acceptance to Kirloskar Brothers for the water system package at 1000 MW Koderma thermal power project stage I in Jharkhand.

The total value of the contract is INR 166.77 crore. The scope of work involves supply and installation of balance of plant package. It also includes construction, erection, testing, inspection and commissioning and handing over of the project including all associated electrical civil, structural and architectural work as specified.

Reliance Rosa power plant to complete ahead of schedule

It is reported that Reliance Anil Dhirubhai Ambani Group promoted 1,200 MW Rosa power project at Shahjahanpur in Uttar Pradesh is slated to be completed by early 2010, nine months ahead of schedule.

According to sources, its construction is progressing and the first phase is all set to commence operation in the second quarter of 2009. Work on the second phase is expected to be completed by early 2010. While construction on stage I has gathered speed, EPC contract has been awarded for stage II to a consortium led by Shanghai Electric Company, which is also the EPC contractor for the first phase. It is expected that half of the power generated from the project would meet the requirements of UP. The remaining would feed neighboring states.

The INR 5,000 crore coal based power project is being developed in 2 stages of 600 MW each. The first phase of the project, costing INR 2,641 crore, has already achieved financial closure. To speed up the process, Reliance has obtained all statutory and regulatory clearances and approvals. Land, water and coal have already been arranged. During the first stage, the project will supply entire 600 mw to distribution companies in Uttar Pradesh.

Stage II of the project is also at an advance stage as statutory approvals from various authorities such as Airport Authority of India and Air Head Quarters have been obtained. The fuel for the coal fired plant would come from Jharkhand for which a long term supply linkage has been given. RPSCL has also signed a transportation agreement with Indian Railways.

Corus to cut tinplate operations at Trostre tinplate works

TATA Corus plans to shed nearly 300 jobs at its tinplate operation in Llanelli on the weekend blaming the move on overcapacity in the global marketplace.

Corus began a formal 90 day consultation process with unions over the planned job losses, which the company said were aimed at making a sustainable position of the packaged steel operation at Trostre, which currently employs 751. Only last year the Trostre site announced 100 redundancies. As well as reducing its headcount, the plant will also scale down output of products, such as tinned cans, by 150,000 tonnes.

Corus could not confirm at this stage if it would need to seek compulsory redundancies. However, it will examine the option of offering affected staff jobs at other Corus plants in South Wales, including its heavy steel operation at Port Talbot, which is part of TATA Corus Strip Products division.

Mr Hugo Loudon MD of Corus Packaging Plus said that "It is after extensive consideration and with great sadness that we make this announcement. CPP has an excellent record of continuous improvement and it is despite the best efforts of our employees that we must take these measures.”

He added that “The European tinplate market continues to experience very difficult market conditions due to significant overcapacity. To ensure the longer-term viability of our packaging steels business we must take action to improve our operating results.”

Olympic Steel to set up a service center at Sumter in South Carolina

US steel service center major Olympic Steel Inc announced that it plans to construct a new facility at Sumter in South Carolina state of US.

The facility is expected to be completed by 2008 end and involves the construction and equipping of a 100,000 square foot facility at a total investment of approximately USD 10 million. When fully operational, the facility is expected to employ 65 employees.

Mr Michael D Siegal chairman & CEO of Olympic Steel said that "We are pleased to announce a new Greenfield facility in Sumter, South Carolina. Complementing the 2006 acquisition of our North Carolina operations, we are excited to further expand our processing capabilities in the southeast region for our valued customers. The Sumter location was particularly attractive to us because of its excellent proximity to original equipment manufacturers and the availability of a skilled labor force. Importantly, this project would not have become reality without the tireless effort and support of the State of South Carolina and Sumter County.

Founded in 1954, Olympic Steel is a leading US steel service center focused on the direct sale and distribution of large volumes of processed carbon, coated and stainless flat rolled sheet, coil and plate steel products. Headquartered at Cleveland in Ohio, it operates 15 facilities.

IISI calls for prioritizing safety and health issues

The Executive Committee and Board of the International Iron and Steel Institute reaffirmed the industry’s commitment to safety and health at a Board meeting in St Petersburg.

IISI has launched a new industry wide position paper on safety and health and produced a guidance book on the IISI safety and health principles.

Mr Ian Christmas said Secretary General of IISI while speaking at the board meeting of IISI said that "The steel industry has today reaffirmed its commitment to the goal of an injury free, illness free and healthy workplace. The industry track record continues to improve, none the less safety has to remain a question of constant vigilance. To help achieve this IISI members are working in small networks to identify industry best practices in some critical safety and health topic areas. The practices are then made available to the membership, allowing them to benchmark and develop their internal procedures. The steel industry is united in pursuing all best practices that help lead the way to accident free workplaces."

He added that nothing is more important than the safety and health of the people that work in the steel industry.
1. All injuries and work related illnesses can and must be prevented.
2. Management is responsible and accountable for safety and health performance.
3. Employee engagement and training is essential.
4. Working safely is a condition of employment.
5. Excellence in safety and health supports excellent business results.
6. Safety and health must be integrated into all business management processes.

Ternium could maintain a stake in Venezuela unit

Reuters reported that steelmaker Ternium may maintain a stake in its Ternium Sidor unit, which is being taken over by the Venezuelan government.

Ternium parent company Argentine conglomerate Techint in a statement said that Ternium which is listed in New York and has its legal base in Luxembourg has set up a negotiating committee with the Venezuelan government to agree on compensation value.

The company previously said a government Sidor joint transition committee would take over operations at the Venezuela unit while the terms are agreed.

Techint said that Ternium Sidor is a major supporter of other industrial enterprises in the region and in that framework, Ternium could maintain a participation in the capital of Sidor.

Mr Paolo Rocca president of Techint met with Argentine Ms Cristina Fernandez President of Argentina who is an ally of Venezuela's President Hugo Chavez. Techint has asked Ms Fernandez to help it negotiate a fair price for Ternium, but the Argentine government has not made any public statements.

Argentina was caught by surprise last week when Venezuela announced it would nationalize Ternium Sidor, which had reached an agreement with Chavez last year to avoid being taken over.

Techint in a statement said that "Mr Paulo Rocca is committed to make his best effort to achieve an agreement that is positive for both sides, based on the friendly relationship between Argentina and Venezuela.”

CSC Q1 pretax profit falls by 9.4% YoY

Bloomberg reported that China Steel Corp had a 9.4% decline in Q1 pretax profit after costs climbed. Profit before taxes was TWD 14.3 billion (USD 472 million) in the three months to March 31st 2008 as compared with TWD 15.8 billion a year earlier.

It said that costs of importing coking coal used in steelmaking surged by 16% from a year earlier to USD 130.77 a tonne in the first two months of the year.

Trinecke zelezarny buys screw maker Sroubarna Kyjov

CTK reported that steel maker Trinecke zelezarny has become the new and exclusive owner of Sroubarna Kyjov, a large European producer of railway screws. The price of the transaction has not been disclosed.

Ms Dusana Chrenekova a spokeswoman of Trinecke told CTK that German antitrust office has approved the acquisition these days.

She explained that Trinecke will add sophisticated products for the railway industry and for bearings to its line. The company uses materials from Trinecke and raises their value added, Tomas Chrenek, chairman of the supervisory boards of Trinecke zelezarny and Moravia Steel.

Mr Kristian Chalupa Czech antitrust office UOHS spokesman said the office has not yet received the application for permitting the merger.

Sroubarna, whose sales reached around CZK 708 million in 2006, was owned by brothers Mr Petr and Mr Pavel Holesinskys. It exports goods to over twenty countries, including Pakistan, Mauritania, Malaysia and Vietnam and newly also to Syria.

Pig iron prices continue to move upward

Global pig iron prices are soaring to historic levels. As per report current pig iron transaction prices in Southeast Asia are prevailing at USD 680 to USD 690 per tonne supported by strong demand.

A buyer in Taiwan reportedly paid USD 700 per tonne for Russian pig iron on CNF basis. The quoted price in Japan is now also at as high as USD 710 per tonne to USD 720 per tonne CNF.

Japanese Nippon Steel has been purchasing from India and Brazil. However, import price of pig iron was pegged at USD 710 per tonne to USD 720 per tonne CNF in Japan. The company is reluctant to pay a higher price than USD 700 per tonne. There will be few deals being concluded in the coming weeks.

(Sourced from YIEH.com)

ISRI announces new executive team

The Institute of Scrap Recycling Industries’ board of directors has elected a new leadership team for its association. The elections were held during ISRI’s recently concluded Convention and Exposition.

The new team includes the following
1. Mr George Adams Jr of SA Recycling as chairman
2. Mr John Sacco of Sierra International Recycling as chairman elect
3. Mr Jerry Simms of Atlas Metal & Iron Corp as secretary treasurer
4. Mr Doug Kramer of Kramer Metals Inc as secretary treasurer

Also elected to Director at Large seats on the ISRI board were the following:
1. Mr Nicholas Cerminaro of Keywell, LLC
2. Mr Alasdair Gledhill of ELG Metals, Inc
3. Mr Howard Glick of Tri State Iron & Metal Co
4. Mr Mike Potash of Sioux City Compressed Steel Co
5. Mr Mike Hinsey of Granutech Saturn Systems Corp was elected as associate member director at large.

US fines Ohio Pickling and Processing over safety violations

It is reported that Ohio Pickling and Processing LLC, of Toledo has been cited for several safety violations and fined USD 27,450 by the US Occupational Safety and Health Administration.

Ohio Pickling and Processing LLC was cited for serious violations, including unsanitary conditions, lack of safety guard rails on standard fixtures and failure to provide safety equipment such as chemical resistant suits and splash aprons and inadequate safety training.

Japanese H2 scrap average prices up

During the third week of April, Japanese H2 scrap average price was at JPY 55,091 per tonne in three largest regions, an increase of JPY 1,766 per tonne than last week.

Among them, H2 scrap price was JPY 55,167 per tonne in the Kanto region, increasing by JPY 1,500 per tonne than last week; JPY 54,640 per tonne in middle part, increasing by JPY 2,000 per tonne; JPY 55,467 per tonne in Kansai region, up by JPY 1,800 per tonne.

Japanese H2 scrap average price was JPY 55,353 per tonne in the first week of April.

(Sourced from YIEH.com)

AK Steel leads way for US steel price increases

It is reported that a recent surge in US steel prices led by AK Steel Holding Corp has been getting mixed reviews from analysts as to whether the increases are a good move in today's unsure economy.

According to Purchase magazine, US prices for flat rolled steel on average jumped to USD 740 a ton in March from USD 655 per ton in February. However, AK Steel recently pushed the price to USD 1,000 a ton after raising prices for hot rolled steel by USD 150 a ton.

Other steel companies have been moving to follow suit, with ArcelorMittal announcing it will increase prices by USD 250 a ton on some steel shipments. US Steel Corp. is expected to make a similar announcement.

Mr Charles Bradford steel industry analyst of Bradford Securities of New York said that “This market has gone crazy. You'll probably see USD 1,000 a ton steel by June.”

But analysts from the financial site TheStreet.com said that stocks in the Market Vectors Steel ETF, which includes US Steel and ArcelorMittal, could be overvalued. The analysts pointed to the recent surges in steel stocks despite a weakening US economy as a potential concern for steel investors.

Ms Nancy Gravatt a spokeswoman for the American Iron and Steel Institute said that as long as the overseas demand for steel continues to increase, steel prices as well as US company values will remain high.

New Orleans port receives shipment of steel piping

It is reported that an unusually large shipment of heavy equipment cargo arrived at the Port of New Orleans.

The delivery to the port's Louisiana Avenue wharf included more than 25,000 cubic meters of steel piping from China for a coal fired power plan at Livery in Illinois.

Stevedores spent the day moving the pipes onto 24 hopper barges, which will move the materials to their destination up the Mississippi River.

Weirton city leaders continue Weirton Port talks

wtov9.com reported that Weirton city leaders are continuing to discuss the possibility of building a port in the city and even have a particular piece of property in mind. Mayor Mark Harris said that Brown’s Island would be an ideal spot for the port plan but the property is owned by Arcelor Mittal. He said that they hope to talk to the steel company about donating the land to the city.

It added that then Weirton city leaders would try to obtain up to $9 million available from the Army Corps of Engineers.

Mr Harris said if the city gets Brown’s Island, the possibilities for both West Virginia and Ohio are endless, especially when it comes to business. Mr Harris added that “There’s some mention last year maybe of an amusement park or a water park. That would be a great idea if we can get someone to come forward and put the money here.”

Sale of Croatian shipyards to start soon – Report

According to coalition agreement between Croatian Democratic Union, Croatian Peasants' Partyand Croatian Social Liberal Party, the privatization of Croatian shipyards should start in year 2008.

As per agreement the first step should be corporate restructuring and improvements in management mechanisms. The main goal is to enable shipyards for profitable production where Government will participate only through subventions for research, development and innovation.

Vietnam tightens control over investments and prices

VNA reported that Vietnam’s Politburo has recommended tighter price controls and a stronger role for the State bank in overseeing investments, as part of a series of measures to overcome the challenges the national economy has been facing.

At a recent meeting discussing socio economic issue of the year’s first quarter, it urged that relevant parties had to make concerted efforts to overcome challenges in developing the economy. The Politburo stressed the importance of regulating financial and monetary policies, managing the emerging stock and real estate markets; strengthening market price controls; encouraging export and limiting deficit. It also asked relevant offices to ensure every measure was taken to ensure businesses could boost their production while strengthening social welfare policies.

As for the State’s financial policy, the Politburo said that measures should be taken to increase the State budget’s revenues while implementing a tight financial policy, cutting down on regular expenses and increasing the efficiency of investment that fell under the State budget.

It said it was essential to raise export taxes at an appropriate rate on some mineral resources and increase import taxes and inland taxes on some non essential and luxurious consumables. The Politburo continued that measures should ensure there was no loss of tax revenue.

Projects considered to be less efficient and not urgent will not be provided State funds this year, while efforts will be concentrated on key national projects.

TNB Q2 earning fell by 31% YoY

Malaysian power utility Tenaga Nasional said that its earnings in the Q2 fell 31% to MYR 1.069 billion from MYR 1.574 billion a year ago, due to lower operating profit and decline in foreign exchange translation gains. Tenaga Nasional said that its revenue was however higher at MYR 6.10 billion compared with MYR 5.68 billion a year ago up by 7.3% YoY.

Elaborating on the Q2 revenue, it said this was on the back of higher sales of electricity in Peninsular Malaysia, which rose 8.2% YoY or MYR 154.3million for the commercial segment. As for the domestic segment, its sales rose 7.7% YoY or MYR 67.3 million while for the industrial sectors, sales rose by 5.6% YoY or MYR 126 million.

Tenaga Nasional Berhad is the largest electricity utility in Malaysia with more than MYR 67.0 billion in assets. The Company is listed on the main board of Bursa Malaysia and employs approximately 28,000 people to serve a customer base of over seven million in Peninsular Malaysia and Sabah. TNB plays an integral role in the national, economic and social prosperity of the country by providing reliable and efficient services.

Recession reports - US demand for copper battered by housing and construction

Reuters reported that demand for base metals in the United States has been falling sharply on the back of the US housing debacle and the trend is likely to worsen with expected slowdowns in commercial and industrial building. So far metals investors have ignored doom and gloom from the world's biggest economy and instead poured billions into metals, especially copper which is up 27% on the year and trading near record highs at USD 8,480 a ton on the London Metal Exchange.

According to the US Department of Commerce, indeed US imports of refined copper are off almost 29% in the first two month of this year to 116,389 tonnes from 163,699 in the same period a year ago. Likewise, aluminum was off nearly 10% in the period and zinc imports are down 6%. Nickel, used in stainless steel, however, was up almost 27%. With the construction of a typical house in the United States consuming 439 lbs of copper, it was inevitable the collapse in housing would hurt demand for the industrial metal.

UK based commodity consultancy CRU said that 25% of the copper price was due to speculative demand. But with US metal imports slumping and Chinese demand growth also looking tepid, some of the fundamental support underpinning lofty metal markets in New York and London could be weakening.

Mr Edward Meir analyst of MF Global said that "Recession risks are rising. Demand in the United States is declining and demand growth in China is slowing. With all this going on and the woeful state of the US housing market, why on earth is copper around record levels? Fundamentally it makes no sense. This is all down to investment flows."

Ms Catherine Virga an analyst with CPM Group in New York said that "I expect copper demand in the US to be weak, especially in this first half of the year and even in the second half. If you look at residential housing, that market has been very weak."

Meanwhile US construction spending in February declined for the fifth straight month, hitting its lowest annual rate since mid 2005. Mr Torsten Slok senior economist at Deutsche Bank in New York said that "It is definitely clear that things are still looking pretty weak in construction for the home-building sector in particular.”

But the depressed state of housing in the United States, which accounts for about 40% of all domestic copper use, may be only the first hit to the construction industry. Signs are emerging that the commercial, industrial and heavy construction sectors, which have so far shrugged off the worst of the slump, are about to weaken markedly.

CEZ to invest more than CZK 5.5 billion on renewable sources by 2012

Thomson Financial reported that Czech power group CEZ is planning to invest more than CZK 5.5 billion in power production from renewable sources, with the majority of it going into wind farms.

As per report CEZ plans to construct wind farms with a total combined installed capacity of 100 MW by 2012 and to have biomass and bio gas projects with a total combined output of 20 MW.

CEZ said it will spend CZK 4 billion on the development of wind farms, and CZK 1.2 billion should be spent on bio-gas and biomass projects while CZK 350 million will be used to enhance output from small hydroelectric plants.

HK government to go ahead with CT10

It is reported that Hong Kong government has decided to go ahead with its plan to build a 10th container terminal in southwest Tsing Yi.

As per report there has been strong industry opposition to the building of the terminal with more container traffic moving to cheaper mainland ports, but a government study said that Hong Kong will need Container Terminal 10 by 2015.

Southwest Tsing Yi has been chosen as the site for the new terminal over northern Lantau for environmental reasons.

Hong Kong's container throughput has grown by an average of three per cent a year in the past three years and reached a high of 24 million TEUs last year.

Iraq qualifies 35 firms for oil exploration

It is reported that Iraq’s oil ministry has approved a list of 35 global oil majors qualified for bidding in soon to be announced tenders to develop oil and gas fields.

As per report, 120 companies had submitted documents between January 9th 2008 and February 18th 2008 to participate in the licensing round.

The qualifying companies, in alphabetical order by country, are as follows

1) Australia: BHP Billiton, Woodside
2) Britain: BG International, BP, Premier
3) Canada: Nexen
4) China: CNOOC, CNPC, Sinochem, Sinopec
5) Denmark: Maersk
6) France: Total
7) Germany: Wintershall BASF Group
8) India: ONGC
9) Indonesia: Pertamina
10) Italy: Edison, ENI
11) Japan: Inpex, Japex, Mitsubishi Corp, Nippon Oil Corporation
12) Malaysia: Petronas
13) Netherlands: Shell
14) Norway: StatoilHydro
15) Russia: Gazprom, Lukoil
16) South Korea: Kogas
17) Spain: Repsol
18) United States: Anadarko, Chevron, Conoco Phillips, ExxonMobil, Hess Corp, Marathon, Occidental Petroleum

It is planning to soon open at least 6 major oil and natural gas fields for exploration and production in the first bidding for licenses since the US led invasion in 2003.

IMF predicts Turkey to become world's 15th largest economy

The latest forecast in the World Economic Outlook of the International Monetary Fund has revealed that, with the adoption of revised national accounts using improved methods of calculation, Turkey's gross domestic product in terms of purchasing power parity will climb to USD 941.6 billion as of the end of 2008.

IMF has published its predictions on countries for the 2006 to 2013 period in its World Economic Outlook, assessing Turkey with its new figures, which the Turkish Statistics Institute updated in accordance with a new basis year. Turkey had been calculating its national accounts by taking 1987 as the basis year, following UN procedures. However, it recently switched to using 1998 figures as the basis for calculations and adopted the methodologies of the EU. This change in method caused the GDP of the country to grow by one-third on paper. Turkey is currently accepted as the 19th largest economy in the world.

This change in methodology does not create real growth in the economy, but it does include parts of the economies that previously existed but were not taken into consideration in GDP calculations. Calculations performed by the Anatolia news agency on the IMF predictions for world economies show that Turkey would remain in 19th place with USD 773.7 billion if it had not changed its system.

Turkey's gross national product, on the other hand, is expected to be USD 748.3 billion for 2008, and this figure will keep it in 17th place among the world's largest economies in terms of GNP.

Although Turkey is among the leading economies in terms of the aggregate size of its economy, it is located somewhere in the middle in terms of the per capita gross domestic product in terms of purchasing power parity. Turkey will be 60th after Malaysia with its USD 13,511 per capita GDP.

The figures obtained from the IMF report also indicate that the world's wealthiest people will be living in Qatar, where the per capita gross domestic product in terms of purchasing power parity will be USD 84,833 by the end of 2008. It will be followed by Luxembourg with USD 83,456 and Norway with USD 55,452.

Another striking prediction from the IMF is that India will pass Japan by 2013 if it can maintain its current pace of development. Brazil will become the eighth largest economy in 2013, surpassing France, and Mexico will rise to first place by overtaking Spain. South Korea will replace Canada to become the 13th largest economy. The Netherlands is expected to drop out of the top 20 league this year, but Poland, currently 21st, will enter this group for the first time.

Iran may replace Turkmenistan in Nabucco gas project

Mr Alan Waddams EU's new ambassador in Azerbaijan said that Iran could replace Turkmenistan in the Western backed Nabucco pipeline project designed to pump gas from the Caspian to Europe bypassing Russia.

Mr Waddams said that EU representatives had agreed to export gas to Europe via Nabucco, but if the Turkmen side changed its mind, then Iran could step in as an alternative.

The USD 7 to USD 8 billion Nabucco pipeline, backed by the EU and the US, is expected to link energy rich Central Asia to Europe through Turkey, Bulgaria, Romania, Hungary and Austria.

Construction on the pipeline with a projected annual capacity of between 20 and 30 billion cubic meters has been tentatively scheduled to begin in 2010.

Azerbaijan, Iran, Turkmenistan and more recently, Iraq have been seen as possible suppliers for the project. Iraq is being backed by the United States.

Building contracts unviable due to price hike

The Post reported that All Pakistan Contractors Association has declared that in view of the unprecedented escalation in the prices of essential building material, the contracts signed for various projects are no more viable.

An emergent meeting of the association held recently reviewed the whole situation and decided to approach the new government to express their helplessness in executing various projects.

Pointing out the problems of the contractors, the meeting noted that the cost of steel products like ingots, billets, steel bars has risen by about 60% to 80%. According to builders, the steel products alone were not allowing them to dare accomplish their projects. They said that it was not steel products , the increase in transportation charges, cement and labor all have put together to cover the building industry.

Explaining the current situation, one builder highlighted that the steel bars which were costing PKR 40000 per tonne were now available for PKR 84000 per ton. He said, such an unusual jump was not allowing the contractors to execute projects because the cost of products has escalated for more than the amount agreed in the contracts.

They were unanimous in their opinion that if timely measures were not taken, the building sector and all the areas of construction industry would be hit badly.

Foster Wheeler unit wins Banagas deal

Trade Arabia News Service reported that a Foster Wheeler subsidiary has won a contract to carry out the pre front end engineering design for the revamp and expansion of the Banagas liquefied petroleum gas facilities in Bahrain.

The expansion will allow the plant to increase its gas throughput, which is planned to reach 530 million standard cubic feet per day by 2020. The contract will be carried out by the UK headquartered Foster Wheeler Energy Limited. The contract value for this project was not disclosed.

Foster Wheeler will develop the configuration for the expanded plant, which will include high yield LPG recovery units. It will also produce a licensor evaluation and the basis of design for the selected technology and other areas to be revamped for inclusion in an invitation to bid for the Feed phase of the project.

Mr Michael J Beaumont chairman & CEO of Foster Wheeler Energy Limited said that "The award of this contract continues Foster Wheeler's long standing relationship with Banagas. With our knowledge of Banagas' existing facilities and our in depth technical expertise, we will work with our client to develop an optimized development scheme of this expansion."

Foster Wheeler is a global company offering a broad range of engineering, procurement, construction, manufacturing, project development and management, research and plant operation services.

USD 600 million GIIC expansion puts on hold – Report

Gulf Daily News reported that work on one of the Gulf's biggest industrial schemes underway in Bahrain has been put on hold until it complies with global environment standards.

As per report, the USD 600 million expansion of the Gulf Industrial Investment Corporation's plant operations in Hidd must first comply with a range of local and international standards on air quality and noise pollution.

Manama based Posford Haskoning Environment Gulf was appointed to carry out an environmental impact assessment and has brought in experts from its UK based partner company Royal Haskoning.

Ms Halel Abdulrahman MD of Gulf Industrial Investment Corporation said that the project could not go ahead until officials obtained approval from the general directorate of environment and wildlife protection.

More than 272,000 square meter of land is needed to construct a second GIIC plant and the project will also include the expansion of a stockyard and jetty. The development will increase its iron ore palletizing capacity from 6 million to 11 million tonnes a year and help Bahrain become the main supplier for the Gulf steel industry. The new plant is expected to begin production in the third quarter of 2009.

Ms Abdulrahman said that the study had been underway for a year and involved site assessments, consultations and secondary data collection. It found the expansion would not adversely affect the environment, as long as GIIC follows the agreements and implements a series of measures. She added that "The assessment included a detailed air monitoring exercise, noise and ground water assessment, waste and chemical usage, material handling and dust management."

Pakistan trade deficit surging

The Dawn reported that Pakistan’s trade deficit stands at USD 14.486 billion during July 2007 to March 2008 period, crossing over the annual budgetary projections of USD 14.022 billion and exceeding the target by 3.3%.

According to the trade figures released by the Federal Bureau of Statistics, Pakistan suffered an all time high USD 14.486 billion trade deficit during July 2007 to March 2008 period as against USD 10.041 billion deficit during July 2006 to March 2007 period, showing an increase of 44.27% YoY.

Comparison of March 2008 over March 2007
Pakistan’s exports witnessed a healthy increase of 17.29% YoY with total exports USD 1.786 billion during March 2008 as compared to exports of USD 1.523 billion in March 2007. Imports during March 2008 were also on the higher side and stood at USD 3.823 billion as against the imports of USD 2.622 billion made during March 2007, showing an increase of 45.78% YoY. Trade deficit during March 2008 jumped to USD 2.036 billion as compared to a deficit of USD 1.099 billion during March 2007 indicating an increase of 85.26% YoY.

March 2008 over February 2008 comparison
Exports of Pakistan witnessed an increase of 14.89% MoM with total exports at USD 1.786 billion as compared with exports of USD 1.554 billion during February 2008. Imports increased by 4.48% MoM that amounted to USD 3.823 billion in March 2008 as against the imports of USD 3.659 billion in February 2008. Trade deficit showed decline by 3.20% MoM in March 2008 with total deficit of USD 2.036 billion as against the trade deficit of USD 2.104 billion in February 2008.

The government has fixed exports target at USD 19.2 billion and in order to meet the target, Pakistan requires exports to the tune of USD 4.713 billion in April 2008 to June 2009 period. Pakistan’s exports have been made uncompetitive in the international market by decline in industrial production due to power and gas shortages, increase in the prices of raw material and transportation charges.

In July 2007 to March 2008 period, Pakistan’s total exports amounted to USD 13.476 billion as compared to USD 12.377 billion, indicating an increase of 8.87% YoY. While the imports amounted to USD 27.962 billion as compared to USD 22.419 billion, projecting an increase of 24.73% YoY.

Dr Ather Maqsood Ahmed member of Fiscal Research & Statistics, in his recent analysis, said that the unprecedented increases in prices of oil and primary products like wheat and edible oil have put tremendous burden on the import bill of Pakistan. On the other hand, the performance of export sector has remained unsatisfactory, if not disappointing, thereby providing no respite to the balance of payment position.

CNPC inks LNG supply deal with Qatar Petroleum & Shell

China National Petroleum Corporation recently announced that it has signed an agreement with Qatar Petroleum and Royal Dutch Shell for a 25 year LNG supply deal. The deal was signed by Chinese Premier Mr Wen Jiabao and Qatar Prime Minister Mr Sheikh Hamad bin Jassem al Thani.

Under the agreement, CNPC will purchase 3 million tonnes of LNG per year from the Qatargas 4 LNG project, in which Qatar Petroleum holds 70% and Shell 30%.

The Qatargas 4 LNG project is expected to produce 1.4 million cubic feet of gas per day. It will entail the development of facilities capable of producing 7.8 million tonnes of LNG per year.

It may be noted that China is increasingly turning to clean energy such as LNG as part of an effort to reduce greenhouse emissions. China is seeking to boost gas consumption to 9% of total energy used from the current 3%.

Update on DP World’s performance in 2007

DP World has announced excellent results from its portfolio of 42 marine terminals for the year ended December 31st 2007. New developments were won and planned capacity expansions came on line, allowing DP World to keep pace with the expanding needs of its customers globally.

Mr Sultan Ahmed Bin Sulayem chairman of DP World said that "This is an excellent set of results driven by DP World’s well positioned portfolio which benefits from the strong Asia to European trade routes and the growth of container cargo in the faster growing economies of the emerging markets. This is a trend we expect to continue. This outstanding result, a 52% growth in profits, was achieved at the same time as the company made significant business wins and undertook an initial public offering. We have now built an excellent financial platform to support our future growth."

He added that "DP World continues to invest for its growth. Taking the capital intensive nature of our business into consideration, but acknowledging that we are a financially strong company with the ability to finance our existing pipeline of 13 new developments, the board is recommending a greater than expected dividend of 1.33 cents per ordinary share for the full year 2007."

Mr Mohammed Sharaf CEO of DP World said that "2007 saw DP World move to become a pure port operator. We entered new markets in Africa and won approval to develop two new ports in capacity constrained northern Europe with London Gateway and Maasvlakte 2, Rotterdam. Our volumes increased well ahead of the market during 2007, growing 18% against an expected 12.2%3 for the global market overall. Our flagship port, DP World Jebel Ali, grew to become the world’s seventh largest port, handling a record 10 million TEU."

DP World is one of the largest marine terminal operators in the world, with 43 terminals and 13 new developments across 28 countries4. Its dedicated, experienced and professional team of nearly 30,000 serves customers in some of the most dynamic economies in the world.
DP World aims to enhance customers’ supply chain efficiency by effectively managing container, bulk and other terminal cargo.
The company constantly invests in terminal infrastructure, facilities and people, working closely with customers and business partners to provide quality services today and tomorrow, when and where customers need them.

DP World performed strongly in 2007, delivering increased profits and adding value for customers. Our strong financial performance in the first half of 2007 continued into the second half, with profits more than doubling over that period to record a 2007 profit of USD 420 million up by 52% YoY over 2006.

Chinese steel mills raise product prices

It is reported that some domestic steelmakers slightly raised their steel products prices recently as anticipated by the industry. These steelmakers include Shaoguan Iron & Steel, Liuzhou Iron & Steel and Lingyuan Iron & Steel.

Shaoguan Iron & Steel adjusted ex plant prices of selected products based on the ex plant prices on April 7th with a universal hike of CNY 100 per tonne on top of the ex plant price of steel sheets, low alloyed sheets, carbon steel sheets, boiler plates and pressure vessel plates. The ex-plant prices for regular wire, high speed wire and reinforced steel remain unchanged.

Liuzhou Iron & Steel marked up the prices for hot rolled sheet with a thickness of 12mm and above by CNY 60 per tonne. Lingyuan Iron & Steel marked up the guidance price for reinforced steel, round steel, carbon structural steel and medium width hot strip by CNY 50 per tonne respectively.

Prices quoted by Benxi Iron & Steel for its products remain unchanged.

Tangshan Steel seeks funds

It is reported that Tangshan Iron & Steel Co, the publicly traded unit of China's second biggest steel maker needs to raise CNY 10 billion to fund expansion after posting a 51% profit gain.

The Hebei Province based Tangshan Iron & Steel Co said in a statement to the Shenzhen Stock Exchange that its net income in 2007 rose to CNY 2.14 billion from a revised CNY 1.42 billion a year earlier

CNPC starts construction of western segment of West East pipeline II

CNPC announced that it had kicked off construction of the 132 kilometer western segment of the West-East China pipeline.

The released said the construction starting from Jinghe County to Kuitun County the western segment will be connected by 1,219 mm diameter steel pipelines.

The 9,102 kilometer West East pipeline II construction, which started in February, is planned for completion by 2010 and would transport central Asian and western China natural gas to energy-guzzling southeastern region.

CNPC is parent of PetroChina.

April HR production plan of major Chinese steel makers

MySteel after a survey has reported the production plan of HR by major Chinese steelmakers for the month of April is as under.

(In million tonnes)

(Sourced from MySteel.net)

Shougang inks iron ore transportation pact with NYK

It is reported that on April 15th 2008 a four member delegation of China Shougang International Trade & Engineering Corporation led by Mr Wang Chunli president of Shougang visited NYK to meet with Mr Hidenori Hono managing corporate officer of NYK.

During the meeting, Mr Wang and Mr Hono signed a contract for the transport of one million tonnes of iron ore per year from Brazil to China over a three year period beginning from the second half of 2008. This is the second long term contract between the companies, and certainly a sign of a strengthening relationship.

Mr Wang emphasized his desire for steadfast relations between the companies and expressed his gratitude for the stable transport of iron ore from Western Australia that NYK currently provides.

NYK will make every effort to provide Shougang Corporation with a stable supply of iron ore by safely fulfilling this newly signed three year contract and the 16 year contract signed by the two companies last year.

Shougang International Trade & Engineering Corporation is the trading and logistics arm of the Shougang Corporation, which is an iron and steel manufacturer established in 1919. Their steel production volume is 12.86 million tonnes in 2007 ranked at the 7th biggest in China. Regarding this time contract, Caofeidian in Hebei province in China will be the main port for discharging.

Province wise output of steel products in China in Q1 of 2008

China province wise output of steel product in Q1 2008 is as under

In million tonnes

(Sourced from MySteel.net)

Chery reports surge in export in Q1

Xinhua reported that Chinese carmaker Chery Automobile has recorded a 68.8% YoY growth in the number of exported vehicles during the first quarter.

It exported 37,976 vehicles, 15,478 ones more than the corresponding period last year. The exports accounted for 34.9% of its sales in the first quarter.

The report added that to date, the 11 year old company, based in Wuhu east China's Anhui Province has sold cars to 69 foreign countries. It is ambitious to enter another 15 countries in Central America and the Caribbean this year.

Chery plans to raise its annual output to one million vehicles by 2010.

GAIL and Arrow may join Chinese coal bed methane project

According to Mr Liu Ming Hui MD of China Gas Holdings Ltd GAIL India Ltd and Australia's Arrow Energy may join coal bed methane projects in China.

He said "GAIL is one of our important shareholders and Arrow has experience in CBM, so we would like to join with them. He added that China Gas is holding talks with GAIL for coal bed methane exploration and will decide on an equity stake in the venture soon.

Mr Liu said the company will decide on the volume of imports from Oman by the second half of the year. He said the company may sell as much as 2 million tonnes of LPG from a domestic trading company it acquired. China Gas bought a 53% stake in Zhejiang Zhongyou Hua Dian Energy Co last month.

Mr Liu said China Gas owns 11 LPG terminals, a 15,000 kilometer pipeline network and 3.2 million household customers.

China Gas Holdings Ltd has also an equal joint venture with Oman Oil to ship natural gas to China from the Middle East.

China Merchants 2007 net profit surges by 40% YoY

It is reported that the Hong Kong listed company’s China Merchants Holdings net profit rose to USD 455 million from USD 325.6 million in 2006. Revenue was up by 58% to USD 802.56 million from USD 507.69 million.

China Merchants 2007 throughput rose by 17% YoY to 47.12 million TEUs with mainland China ports handling 40.11 million TEUs up by 20% from 2006

China Merchants has container port investments in Shenzhen, Shanghai, Hong Kong, Tianjin, Qingdao, Ningbo and Zhangzhou.

Chinese fixed asset investment in Q1 of 2008 up by 24.6% YoY

Xinhua cited Mr Li Xiaochao spokesman of the National Bureau of Statistics as saying that China's first quarter fixed asset investment surged by 24.6% YoY to CNY 2.18 trillion from a year earlier.

He said the growth was 0.9 percentage points higher than a year ago.

Chalco to add 900,000 tonnes of alumina capacity in Guangxi

Interfax China reported that the Aluminum Corporation of China Co. Ltd will officially bring online an additional 900,000 tonnes of alumina production capacity on May 26th 2008 as part of an ongoing project at Pingguo county in Guangxi Province.

An official with Chalco's Guangxi subsidiary said that "The Pingguo plant plans to produce 1.22 million tonnes alumina this year, including output from the third phase of the project which is scheduled to come online on May 26th 2008".

The first phase project began operations in 1995 and second phase got underway in 2003, giving the project a total capacity of 900,000 tonnes of alumina each year. The third phase of the project, will double the project’s total current capacity, bringing it to 1.8 million tonnes of alumina per year.

Chalco Guangxi has access to abundant bauxite resources in Pingguo, which will feed the company's three alumina projects. The company also has an on-site electrolytic aluminum production plant.

TMK pipe shipment in Q1 dip by 8% YoY

TMK one of the world’s largest pipe producers announced its production results for the Q1 of 2008.

TMK shipped 707,000 tonnes of pipes, which is 8% YoY less than in the Q1 of 2007. Despite an 8.5% YoY decrease in demand for pipes at the Russian market in the Q1 of 2008, it managed to increase its Russian market share to 25.7% YoY up from 24.8% YoY in Q1, 2007.

The Q1 2008 sales volumes of seamless pipes down by 7% compared to the Q1 2007 figures and amounted to 485,000 tonnes.

TMK’s shipments in the Q1 2008 are down by 12% amounting to 222,000 tonnes. Nevertheless in March, 2008 the Company increased large diameter pipes sales by 10% against February

TMK release said that “This growth was due to an increase in supplies of line pipes, including anticorrosion coated both seamless and welded line pipes by 7% and 43% respectively. Oil and gas industry, which is now experiencing the shift to oil and gas production in challenging geological conditions, has shown greater demand for such pipes. The demand for such tubular goods in the CIS also enabled the Company to increase its shipments of seamless line pipes by 16%.”

The released added that in Q1 2008 TMK continued implementing its Strategic Investment Program, aimed at increasing production volumes of higher value added tubular goods, improving product quality and reducing costs. The scheduled shutdown of obsolete Pilger mills to be replaced by the state of the art PQF rolling mill at Tagmet rendered significant impact on seamless pipe sales volumes.

However, commissioning of the new 600, 000 tonnes per annum high tech PQF mill scheduled for the Q3 of 2008 will enable TMK to enter the market with new products of a higher quality, including Premium connections, and to increase its seamless pipe shipment volumes at year end. Moreover in Q1 of 2008, despite a 6% decrease in OCTG shipments, the Company continued increasing shipment volumes of drill and tubing pipes by 40% and 2% respectively against Q1 2007 figures.

Delays associated with the implementation of large-scale pipeline projects, such as “Eastern Siberia Pacific Ocean Pipeline” resulted in a decline of the Russian large diameter pipe market. This situation remains favorable for TMK, as in the Q3 of 2008 the Company is going to launch its new welding mill producing longitudinal large-diameter pipes with up to 42 mm wall thickness, which will significantly enhance TMK’s competitiveness and readiness prior to the launch of large scale pipeline projects.

ISTIL completes deal to acquire holding company Berycan

It is reported that Istil Group Holdings Limited has completed the deal on April 9th 2008 in London to acquire the company Berycan Limited 100% of the shares.

It was reported that an agreement on the deal was signed on January 21, 2008, but for the treaty to enter into force required to fulfill a number of conditions.

Berycan Limited Company represents an investment company "MirInvest" in the person of the deputy State Duma of Russia Vadim Varshavsky and his top managers.

Khartsyzsk Pipe 2007 net income down by 17.8% YoY

According to an official statement by the company, Khartsyzsk Pipe Plant decreased net income to USD 64.0 down by 17.8% YoY while its net sales dropped to USD 612.9 million down by 1.8% YoY with a net margin of 10.5% in 2007.

HRTR's sales went down due to lower orders, especially in the second half of last year, which caused output to drop to 486,000 tonnes down by 16.4% last year.

(Sourced from Millennium Capital)

Poland and Ukraine back oil pipeline from Azerbaijan

Islamic Republic News Agency quoted Mr Lech Kaczynskipresident of Polish President and his Ukrainian counterpart Mr Viktor Yuschenko as saying following their meeting in Warsaw that Poland and Ukraine want to press ahead with their oil pipeline project from Azerbaijan in an effort to lessen their dependency on Russian energy supplies.

The report said both heads of states signed an accord for the construction of an oil pipeline from the Polish-Ukrainian border to the Baltic Sea port of Gdansk. Georgia and Lithuania are also involved in the project

As part of the pipeline project, oil from Azerbaijan is to be transported via Georgia to the Black Sea where it is to be shipped to the Ukrainian port city of Odessa.

Warsaw hopes that the Odessa-Brody-Gdansk oil pipeline which would transport Caspian oil west to Poland and Europe could be operational in 2011 despite lingering logistical problems. The 673 kilometer long Odessa-Brody pipeline was completed in 2002.

The main strategic importance of the Odessa-Gdansk pipeline is as revenue producer since charging transit fees can also help spur development in the economically-depressed post-Soviet states. The completed pipeline would supply PKN Orlen, Central Europe's leading fuels refiner and distributor, with Caspian crude oil.

Odessa port to be restructured

Mr Iosif Vinsky Ukrainian Minister of Transport announced that the Odessa Commercial port to be reorganized.

According to him the port needs about USD 500 million of investments.

Zaporizhya Aluminium net income in 2007 down by 20.6% YoY

Zaporizhya Aluminium Plant announced that its net income decreased to USD 15 million down by 20.6% YoY in 2007.

The released added that ZALK earned a net loss of USD 3.7 million in Q4 2007 against net profit of USD 2.6 million in Q3 2007. The news is neutral for ZALK as the net income in 2007 is in line with our expectations. Global aluminum prices dropped significantly in July 2007.

Millennium Capital analysts said that “On the background of rising electricity tariffs down by 30% YoY last year this caused the net income of ZALK to drop in the last two quarters. Though the plant did not manage to lobby special tariffs regulation for itself in February, 2008 we believe that ZALK could be profitable this year as the prices for aluminium could grow from USD 2640 in 2007 to about USD 3500 in 2008 thanks to the electricity crises that happened this year in China and SAR. This could generate global aluminum supply limitations this year.”

(Sourced from Millennium Capital)

Kazakhstan industrial growth slows down in Q1

Reuters reported that Kazakhstan's industrial output growth stalled in the first quarter of this year due to a fall in copper and steel production in a key industrial region.

The statistics agency said industrial production grew at a slower pace of 3.7% YoY in the first quarter of 2008 compared with almost 10% YoY in the same 2007 quarter. Industrial output growth was 10% MoM in March up from 4.3% in February. In YoY terms growth was 4.2% in March 2008.

Ms Aigul Yepbayeva head of the agency's macroeconomic department, told Reuters slower growth was due to a cut in copper and steel output in the industrial region of Karaganda. She said "We are talking about Kazakhmys corporation which has explained it is gradually decreasing production."

Ms Yepbayeva said there was also a decrease in steel production in March at ArcelorMittal's Temirtau production facility in Karaganda. The company had previously forecast a 13% rise in total 2008 production. She said "The same problem can be seen at Temirtau. There is a fall in rolled steel output". ArcelorMittal Temirtau could not be immediately reached for comment.

Severstal Auto changes name to become Sollers

It is reported that Severstal Auto, Russian producer of UAZ off roaders and local partner of Ssangyong and Fiat decided to change its name. The new brand name will be Sollers.

Mr Vadim Shvetsov, CEO of Severstal Auto said Sollers is the Latin for clever, skilful, and this is an appropriate name for our services focused company.

Severstal Auto was born in 2000 when steel giant, Severstal took control of the UAZ automobile factory in Ulyanovsk and the ZMZ engine factory in Zhavolzhe. In 2005 Severstal Auto made a deal with Ssangyong, a South Korean maker of SUVs on local assembly. It was followed by a similar deal with Fiat in 2006.

In order to cater for CKD assembly of Ssangyong and Fiat models, Severstal Auto took over ZMA in Naberezhnye Chelny in 2006. Today it assembles various Ssangyong and Fiat products. A new Severstal Auto-Fiat facility was opened in Elabuga earlier this year, where the Ducato LCV will be produced.

In early 2007 Severstal sold Severstal Auto to Mr Vadim Shvetsov, CEO of Severstal Auto for an undisclosed sum. With the new brand name, the company will open a new chapter in its history.

Russia to increase its share at ship market

Mr Sergey Ivanov senior VP of Russia announced at the session of Sea College Russia may occupy up to 7% at the world specialized ship market.

According to him, producers have to build gas and chemical vessels and ships to serve arctic shelf. He said "If we take 5% to 7% of world market, we will have great orders."

Price hike for SS flat in US fail to stick - Report

Puchasing.com reported that North American stainless sheet buyers appear to have forced producers to withdraw a 5% base price hike. Buyers said that purchases have been so soft that buyers are holding back on orders rather than accept higher prices.

Mr Mark Parr analyst at KeyBanc Capital Markets said that "True demand for stainless steel remains subdued. At this point, the market appears to be struggling to absorb a 5% in April 2008 base price increase on commodity grades."

Mr Parr said that inventory de stocking at the service center link of the supply chain ended late last year and stockpiles are below normal, but in line with current demand levels. He added that "So, a near term return to normalized profitability levels for domestic commodity stainless steel and select specialty metals players appears elusive given the current end market environment."

Stainless steel purchasing in the US dropped by 14% in 2007 despite strength in aerospace and energy end markets. So far in 2008, YoY buys are more than 20% lower than in 2007.

ATI Allegheny Ludlum changes to its surcharge policy

In response to the continuing escalation of raw material prices, ATI Allegheny Ludlum has recently announced the following changes to its surcharge policy for certain stainless and HTA nickel alloy sheet, strip, precision rolled strip and specialty plate products

1. Addition of niobium surcharge
A niobium surcharge will apply to all grades with an ASTM minimum niobium requirement.

2. Addition of Copper Surcharge
A copper surcharge will apply to all grades with an ASTM minimum copper requirement. The trigger level for the copper surcharge is a copper price of USD 1.60 per pound. The surcharge is based on the London Metal Exchange monthly average copper price.

3. Modification of HTA nickel alloy and stainless surcharge for chromium
The chromium surcharge will be modified for certain HTA nickel alloy and certain stainless grades to more accurately reflect consumption of premium chromium units required in manufacturing. Chromium required for these grades is purchased in a variety of forms. The new chromium surcharge will reflect a composite chromium charge mix required for each of these grades.

The new surcharges for stainless alloys are effective with May 4th 2008 shipments and for HTA nickel alloys with immediate effect.

The release added that all other components of the surcharges remain unchanged.

Prices of 304 series SS flats in China

SS 304 2B

In CNY per tonne
Inclusive of 17% VAT

SS 304 No 1

In CNY per tonne
Inclusive of 17% VAT

Competition squeezes European domestic SS304 prices

It is reported that the European domestic price for Series 304 stainless cold rolled coil has dropped back to EUR 1250 to EUR 1300 per tonne, the price at which it has been trading for all but one of the past ten weeks.

Prices increased slightly in the first week of April 2008, but fell back as buyers took advantage of the competition within the domestic market. However, prices are expected to rise again to EUR 1400 per tonne in May 2008 as stainless mills try to keep prices high by only supplying the minimum quantities required by the market.

Shanxi Taigang to raise SS production by 28% in 2008

It is reported that Shanxi Taigang Stainless Steel, the listed arm of Taiyuan Iron & Steel, plans to increase crude stainless steel production by 28.4% to 2.6 million tonnes per annum in 2008 as its 1.5 million tonnes per annum integrated stainless steel project ramps up to full capacity.

Electrical steel prices in Shanghai remain stable

It is reported that the cold rolled silicon steel price remained steady with Baosteel made 470 grades offered at CNY 8200 per tonne, Wuhan Steel made 600 at CNY 7850 per tonne, Angang 800 at CNY 7500 per tonne and Baosteel made 1300 grade at CNY 7450 per tonne.

(Sourced from MySteel.net)

Iron ore price negotiations – BHP and Rio seeking spot prices

Bloomberg, citing a Chinese industry official, reported that both BHP Billiton Ltd and Rio Tinto Group want to charge Chinese steelmakers spot rates for iron ore from Australia if they do not agree with Baosteel Group Corp on contract prices by June 30th 2008.

Mr Chen Xianwen head of market research at the China Iron and Steel Association in an interview in Shanghai said that “They told some of China's top 16 steelmakers that if an agreement can not be reached by then, they will sell the ore under cash prices.”

He added that “Selling the ore under spot prices is irrational. It will hurt demand for the Australian ore over the long term. Both the buyers and sellers should maintain the existing long-term pricing mechanism, and study market changes ''

China imported 146 million tonnes of iron ore from Australia last year and long term contracts currently make up about 90%.

The spot price of iron ore arriving at Beilun port in China as of April 18th was CNY 1480 per tonne equivalent to USD 210 per tonne.

Samarco starts new pellet plant in Brazil

Brazilian iron ore pellet maker Samarco Mineração has inaugurated its third pelletizing plant. The plant at Ubu in southeastern Espírito Santo state would expand Samarco's pellet production capacity by 54% to 20.6 million tonnes per year.

It is part of a BRL 3.10 billion project that also includes an iron ore processing plant in Minas Gerais state and a 398 kilometer pipeline. In addition, technical feasibility and environmental impact studies are underway for related investments in port infrastructure and are due for completion in 18 months.

Mr José Tadeu de Moraes president of Samarco said that the outlook is positive for the pellet market for the coming years, so much so that the company has already begun studies into the construction of a fourth pelletizing plant. He said "We are building the Samarco of the future, a company attentive to market opportunities, more conscious of its social and environmental responsibilities.”

Samarco is a 50:50 JV between Brazil's Vale and Anglo Australian BHP Billiton.

Chinese iron ore import price in Q1 up by 80% YoY

According to the Customs statistics, China imported iron ore and concentrate of 35.68 million tonnes in March 2008 with a value of USD 4.495 billion and in the first three months, accumulative import totaled 110 million tonnes valued at USD 14.132 billion up by 10.5% YoY and 99.5% YoY respectively.

The comprehensive import price averaged USD 128.47 per tonne up by 81.4% YoY

Mr Hu Kai analyst with umetal said that staggering rise of the FOB iron ore price on spot market led to the comprehensive landed price surge. As India keeps correcting iron ore export policy, the spot trading price has been surging, reaching USD 185 to USD 190 per tonne for the moment. Mr Hu said that mounting freight rate also pushes up ore import price, these factors will necessarily generate higher steel production cost and escalating steel price, as well as price rise on home appliance, automobile etc.

According to Mr Luo Bingsheng the deputy director of CISA, China imported 383 million tonnes iron ore in 2007. This year, the iron ore import volume is estimated at 433 million tonne up some 50 million tonne or 13% from 2007,

CISA criticizes resell of contracted iron ore

According to Mr Gu Jianguo vice chairman of China Iron and Steel Association and general manager of Magang Holding Co Ltd recently that some domestic steelmakers and traders resold contracted iron ore to those who are not qualified for import licenses at high prices, providing foreign suppliers with an excuse for price advances. Mr Gu criticized that this move in domestic steel industry pushed up iron ore prices along with some market reasons.

Mr Luo Bingsheng executive vice chairman of CISA disclosed the resell in as early as July of 2006. He criticized the move and claimed this would drive up domestic price. CISA and CCCMC further amended the qualification last year and introduced import information registration system, compelling traders to lock up buyers before imports. In spite of that, resell still exists. As contract price increases 65% to 71% this year the price gap with spot price widens and resell can bring more profits.

The elimination battle started from February of 2005 when CISA and China Chamber of Commerce of Metals Minerals & Chemicals Importers & Exporters swept out more than 200 importers, including many private enterprises. Only some 110 enterprises were licensed to import long term contract iron ore. The battle was launched to regulate iron ore trade order and raise concentration, but the enterprises washed out had to import resources through the agency of qualified enterprises, hence those qualified ones began to abuse authority to seek more gains.

CISA calculates that spot price is usually 15% or CNY 200 per tonne higher than contract price, whereas current contract price still stays below spot price even after a 65% hike. To catch up with spot price, contract price should gain 120% for Brazilian iron ore and 200% for Australian ore.

(Sourced from MySteel.net)

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