PM to lay foundation stone of SAIL BSL expansion project

Dr Manmohan Singh prime minister will lay the foundation stone of the INR 80 billion (USD 2 billion) expansion project of Steel Authority of India Limited’s Bokaro Steel Plant on April 22nd 2008.

BSL plans to ramp up its total capacity to 7.5 million tonnes from the current 4.5 7.5 million tonnes.

This expansion plan is part of SAIL's overall expansion and modernization program worth INR 540 billion. SAIL plans to increase its capacity to 26 million tonnes by 2010 and thereafter to 60 million tonnes by 2020.

SAIL BSP and NTPC JV commissions 250 MW unit

The first 250 Mw unit of the Bhilai expansion thermal power project of NTPC SAIL Power Company Pvt Ltd, a JV of NTPC and SAIL, was commissioned at Bhilai by Mr Jairam Ramesh minister of state for commerce and power. The second 250 MW unit of the expansion project will come on stream by September 2008.

BHEL is the boiler and turbine supplier for the project. The JV with an installed capacity of 314 Mw before the Bhilai expansion, is owned 50% each by NTPC and SAIL and owns and operates captive power stations for SAIL at Durgapur, Rourkela and Bhilai.

Steel prices decline by INR 5000 per tonne – Ministry

Mr Jitin Prasada union minister of state for steel said that steel prices have come down by 10% after deliberations with steel industry. Prices of steel bars, rods and structurals have declined by INR 4000 to INR 5000 per tonne. The decline in prices happened between March 15th 2008 and April 12th 2008.

Mr Prasada said that there is no evidence of cartelization by the steelmakers and that there is no formal proposal to set up a regulator for the sector.

He added that "The steel prices are determined by market forces, such as demand and supply and international prices. The government is closely monitoring the movement in steel prices and will take appropriate fiscal measures if necessary."

ASSCHAM calls Orissa to improve project implementation

Statesman News Service reported that the Associated Chambers of Commerce and Industry of India has suggested Orissa government to adopt a more flexible land acquisition policy and provide more incentives under a new industrial policy expressing grave concern over inordinate delays in mega projects taking off in the state.

Mr VN Dhoot president of ASSOCHAM said "The Industrial Policy Resolution of 2007 adopted in the state needs to be revisited with more tax exemptions for industries.”

Citing instances of Tamil Nadu, Maharashtra and even West Bengal, Mr Dhoot said things moved much much faster than in Orissa. He said Why is it that projects are not taking off and what are the problems relating to land acquisition in Orissa?. That is one reason why Orissa is lagging behind.”

He added that "Assocham is willing to partner the state over the next three years, help formulate the IPR and attract investments to the state.”

PM congratulates TATA Steel on centenary celebrations

Dr Manmohan Singh prime minister of India will be visiting the Jamshedpur on April 22nd 2008 to participate in the Centenary celebrations of TATA Steel.

PM will address a gathering at JRD Sports Complex and plant a Banyan tree sapling, in the same manner as Pandit Jawahar Lal Nehru did on the 50th anniversary of the steel company in 1958.

Dr Singh will also launch a special postage stamp specially created to mark TATA Steel's centenary year by the Government of India's Ministry of Communications.

Brahmani Industries to by Chinese equipments

BL reported that Brahmani Industries Limited has awarded contracts worth INR 930 crore to China Shougang International Trade and Engineering Corporation. As per report, LoI was issued to China Shougang by Mr G Janardhana Reddy CMD of Brahmani at Bellary recently,

As part of these contracts the Chinese company will construct a modern coke oven complex, blast furnace and sinter plants. The coke oven complex contract is valued at INR 480 crore and both blast furnace and Sinter plant are valued at INR 450 crore.

Brahmani is in the process of setting up an integrated steel plant at Jammalamadugu at Kadapa district of Andhra Pradesh. It will produce 1.0 mt gross coke annually. Two more such coke oven batteries will be installed subsequently as a part of expansion. The plant will have waste heat recovery boilers to produce steam necessary for power generation.

Do not blame futures for steel price surge– FMC

Mr BC Khatua chief of Forward Markets Commission said that "Futures trading has become a newfound scapegoat for price rise in commodities."

Criticizing the manufacturers’ demand for a ban on steel futures trading, Mr Khatua said that "India produces about 60 million tonnes of steel per annum, while exchanges trade just about 1 to 1.5 million tonnes. How can exchanges influence prices?"

Referring to the recent ordnance providing autonomy to the FMC, Mr Khatua said that though the ordnance had lapsed, certain changes would be incorporated in the FCRA Bill and will be presented to Parliament.

Vizag Seaport makes new record for day iron ore loading

It is reported that Vizag Seaport Pvt Limited has created a new record by loading 30,800 tonnes of iron ore in 24 hours. The operation ended at 1PM on Sunday.

The iron ore was loaded into MV Tai Chung at EQ 9 berth. The entire operation involving receipt of cargo, storing, feeding to hook point and loading into the vessel was accomplished by VSPL’s own logistic facilities.

The export was done on behalf of Bharat Earth Movers Limited.

Bangladeshi rebar makers against price fixation

The Daily Star reported that leaders of the steel and re rolling industry have urged Bangladeshi government to free the import of old scrap ships and vassals to reduce the cost of scraps and building materials and not to fix rebar prices.

Mr Ali Hossain president, Mr Madul Alam Masud secretary general of Bangladesh Re rolling Mills Association and Mr Fazlur Rahman secretary general of Bangladesh Steel Mills Owners Association said that fixing the prices are opposed to the concept of the market economy based on competitiveness. They added that "It will hurt the industry because if the mils and factories are forced to sell products below the production cost. It will erode the business confidence."

They said that the owners of the steel and re rolling mills should be allowed to import scrap ships freeing the import from the monopoly of the few importers now controlling a large part of the raw materials. Moreover, the government should withdraw the import duty, VAT and advance income tax which together constitute 28% of the import cost for reducing the cost of raw materials of the industry.

They said the government should also allow the import of power generators free of duty so that mill owners can set up their captive power plants to run production unimpeded. The government may realize the import duty on the basis of the import volume to be ascertained by weighting in the port.

They further added that the government should also remove the tariff discrepancy which 10% for import of melting scraps and re rolling scraps while it is only BDT 1,000 for per tonne of scraps from import of vassals and old ships carried out by ship breakers.

Recession reports - India less vulnerable to global turmoil

Mr Y Venugopal Reddy head of RBI said that India's financial sector is likely to be less affected than similar sectors in most emerging economies by the turbulence in global financial markets.

Mr Reddy said that "The money, government securities and foreign exchange markets have been stable in India and, in our view, they may not be vulnerable in terms of direct and first round effects."

Mr Reddy also said that domestic output and prices are under pressure due to high global prices of food, fuel and metals and the turbulence in the financial markets.

Highlights of PGCIL performance in 2007-08

During 2007-08, Power Grid has commissioned transmission projects worth about INR 6,000 crore, thereby adding transmission network of 7,350 circuit kilometers, 9 EHV AC sub stations and transformation capacity of more than 13,700 MVA.

Following are some of the performance highlights

1) Major projects commissioned during the year include, Kahalgaon II transmission system with INR 2830 crore, Vindhyachal III transmission system INR 690 crore, 400 kV D/C Bina Nagda transmission line with INR 388 crore, System strengthening III of southern region with INR 285 crore.

2) At the end of 2007-08, Power Grid is operating around 67,000 kilometers of transmission lines along with 111 sub stations with transformation capacity of more than 73,000 MVA, thus wheeling about 45% of total power generated in India through its transmission network.

3) Power Grid has recorded an impressive financial performance during 2007-08, achieving a turnover of INR 4,700 crore and net profit of INR 1,420 crore as compared to INR 4,082 crore and INR 1,229 crore. With the addition of huge transmission network, gross asset base of the company has been enhanced to more than INR 35,000 crore in 2007-08 from INR 29,015 crore in 2006-07.

4) The state of the art Unified Load Dispatch & Communication schemes implemented by Power Grid are operational in all 5 regions and are greatly contributing to bring quality and economy in operation of power system besides improving data availability, visibility and transparency.

5) In line with the plan to establish an Integrated National Grid in a phased manner, various inter regional transmission schemes have been commissioned undertaken for implementation during the year. Inter regional power transfer capacity of National Grid has been enhanced to about 17,000 MW from 14,100 MW in 2006-07. Four major power regions of the country namely, North Eastern, Eastern, Western and Northern are now operating as one synchronous grid. Southern Region Grids connected to this synchronous grid through HVDC links.

6) During 2007-08, about 43,000 million units of inter regional energy transfer was facilitated, an increase of about 13% YoY as compared to previous year of about 38,000 million units.

7) Under open access, more than 9,560 transactions were approved during the year involving 30,000 million units of energy as compared to 5787 transactions and 23,000 million units of energy during 2006-07, up by 30% YoY. Energy worth about INR 10,100 crore transacted through UI mechanism as compared to INR 6,814 crore during last year, up by 48% YoY.

8) From its telecommunication business, Power Grid received revenue of INR 125 crore during 2007-08, up by 62% YoY as against INR 77 crore in 2006-07.

9) During 11th Plan, Power Grid envisages an investment of about INR 55,000 crore for further developing National Grid including inter regional transmission systems, system strengthening schemes, transmission system for evacuation of power from generation projects under central sector and UMPPs. Inter regional power transfer capacity of the National Grid is envisaged to be enhanced to more than 37,000 MW by year 2012.

10) Under APDRP, Power Grid is acting as advisor cum consultant to lend its managerial and technical expertise for improvement of distribution system in 177 distribution circles, towns and schemes spread over 18 states costing about INR 6,626 crore.

11) Under Rajeev Gandhi Grameen Vidyutikaran Yojana, Power Grid has been assigned the job for execution of rural electrification in 68 districts covering 87,300 villages at an estimated cost of about INR 9,400 crore. Cumulatively, it has electrified 22,082 villages including 300,000 BPL connections. During 2007-08, more than 5,000 number of villages were electrified by Power Grid.

TATA Power synchronizes unit 1 of Haldia Project

TATA Power Company Limited has announced that its unit 1 of 180 MW phase of Haldia Project was synchronized with grid on April 2nd 2008. The second unit is scheduled for commissioning later in 2008.

TATA Power had acquired the 90 MW independent power plant from Hooghly Met Coke & Power Company Limited. The plant will utilize coke oven gases to generate power, a part of which will be sold under a power purchasing agreement to the West Bengal State Electricity Distribution Company Limited and the remaining traded through TATA Power Trading Company Limited.

TATA Power will also set up an additional 30 MW plant to meet the power requirements of Hooghly Met coke's operating plants moving forward.

Lanco’s MP power plant will come up in Balaghat

BS reported that Lanco Infratech Limited has now proposed to set up its 1,200 MW power project in Balaghat and not in Chhindwara.

A state power department official said that "The project will now come up in Balaghat and it had asked the centre for supply from the Mandla North coal block in the Pench Kanhan coal mining area."

It will invest INR 5,000 crore in the project and has been given in principle sanction for land acquisition and water supply. A government source said that "Lanco has asked for coal and environment clearance, and has been given ‘in principle’ sanction for land acquisition and water supply. We hope the firm is able to announce its schedule soon."

Lanco had inked a deal with the Madhya Pradesh government on January 17th 2008 at Khajuraho for the project but it dropped the idea of setting up its unit in Chhindwara because it had not been allocated coal blocks.

GDP growth to moderate at 7.9% 2008-09 – ASSOCHAM

According to ASSOCHAM Research Bureau Analysis, based on the Survey from 217 CEOs under the banner of ASSOCHAM Business Barometer, Indian growth story is set to moderate with inflation and high interest rates impacting major industrial sectors and dampening consumer demand. They have stated the GDP growth figure may remain close to 7.9% for the fiscal 2008-09.

Releasing the ASSOCHAM Survey, Mr Venugopal N Dhoot president of ASSOCHAM said that 66% of the ASSOCHAM Business Barometer participants stated that US recession, domestic inflationary pressures, high interest rates and supply constraints have started hurting industrial growth and consumer demand that may further impact the GDP growth in the current fiscal.

Around 75% of the corporate heads consider the challenges thrown by appreciating rupee and soaring prices of international crude oil and industrial metals may come in the way of sustaining high growth rates by the Indian economy. While the overall growth rate in India’s exports seems to be healthy at 23% in dollar terms for the period April to February 2007-08, slowdown in exports is visible in rupee terms with a meager 9% growth.

GDP forecasts for 2008-09 are as follows

Owing to the depreciating US Dollar there has been a major decline in export growth of the sectors like textiles, petroleum products and engineering goods. These sectors clocked a growth rate of 8%, 32% and 21% respectively over the first eleven months of 2007-08 as compared to the much higher growth rates in the fiscal 2006-07 at 11%, 87% and 38% respectively.

Finished Steel and cement, which were witnessing huge demand arising from infrastructure projects being undertaken by the government and private bodies, are now recording decline in growth. In steel, the growth dropped from 11.1% to 5.1%, while in cement, the growth was 7%, down from 9.9%.

Buoyancy in the transportation sector has been maintained with cargo, air and railway traffic witnessing sustained growth momentum. The cargo traffic at major ports has risen by 12.5% YoY during April to December 2007 period as compared to 8.3%. The passenger traffic at air terminals grew by 26.8% YoY during April to November 2007 period on top of a 33.2% increase in first eight months of 2007. The total railway freight earnings recorded a low growth rate of 8.2% during April to December 2007 period as compared to 9.7% April to December 2006 period.

Navabharat Power begins groundwork for phase II of Malaxmi project

SNS reported that Hyderabad based Navabharat Power Private Limited is preparing the groundwork for the 1,200 MW phase II of the 2,050 MW Malaxmi mega thermal power project at Meeramundali and Kharagprasad villages in Dhenkanal district of Orissa.

Mr PN Bhaskar senior VP of Navabharat Power Private Limited said that the 1,050 MW phase I of the project, coming up on 1,200 acres of land provided by the Orissa government, is nearing completion. He added that "We started off with a plan to set up a 2,050 MW power plant of which phase I is 1,050 MW, involving an investment of INR 4,800 crore. 75% of the project cost is funded by financial institutions and the balance 25 per cent through equity."

Mr Bhaskar said that "NPPL has just invited proposals for expression of interest cum request for qualification for phase II." He added that bids had been invited from EPC contractors for setting up two units of 600 MW or any other configuration that conforms to the capacity. The completion period for the first unit is 36 months and that for the second, 40 months.

According to Mr Bhaskar, Navabharat Power Private Limited has signed the power purchase agreement under which 25% of power will be exported to Grid Corporation of Orissa and 75% to Power Trading Corporation, with a tariff rate of INR 2.35 per kW as approved by the Central Electricity Regulatory Commission. It is also allowed to sell 30% of PTC's share of 75% at an agreed rate of INR 4.50 per kW.

Mr Bhaskar further added that "NPPL can make good amount of money out of this deal. Although Orissa is currently facing power shortage, once all the power projects such as ours come through, the state will emerge power surplus."

Government formula for price escalation inadequate – Builders

BL reported that contractors executing civil public works said that the government's formula for price escalation in public construction contracts fails to cover the full impact of recent escalation in the cost of construction steel and is likely to hamper execution of government and quasi government rate contracts for construction work.

Mr Anand J Gupta general secretary of Builders Association of India said that “At the heart of the problem is the 70% hike in such steel over the last one year, which has seen prices go up from INR 28,300 a tonne in January 2007 to INR 48,000 a tonne in April 2008. The rate contracts are linked to the wholesale price index and in terms of the formula for escalation contractors can only expect a mere 4% to 5% raise in contract value for the hike in steel prices, though steel had gone up by about 50% since December 2007.”

Mr Gupta also said that government and quasi government contracts at the all India level were worth about INR 370,000 crore and the steel component in them was about 35%.

Mr Mahesh Mudda chairman of Mumbai chapter of Builders Association of India said that "The northbound steel prices have put in jeopardy the government's grandiose plans for the 2010 Commonwealth Games. The Central Public Works Department, one of the executing authorities for construction work for the games, has not received bids for two tenders floated in the last 10 days."

Mr Mudda said that it had been pointed out to the central government that steel companies were arbitrarily jacking up prices. Five major integrated steel plants control 65% of the total steel production in the country and they had formed an association called 'Indian Steel Alliance'. Periodical price increases by them were almost identical, it alleged. Of the 5 steel majors, only 3 produce steel bars, rods and structural steel called long products.

Petronet LNG to invest USD 3 billion in Australian CBM project

Thomson Financial News reported that India's Petronet LNG Limited will invest USD 1.5 billion to USD 3 billion to join one or more coal bed methane projects in Australia.

Mr Prosad Dasgupta MD of Petronet said that the Queensland based projects would convert coal based methane to LNG, which would later be imported to India. He added that it is likely to make an announcement on the projects in the next 6 months.

ABG trying to raise USD 200 million for 3rd shipyard

Exim News Service reported that ABG Shipyard Limited is trying to raise USD 200 million by means of a share sale to part finance the setting up of a third shipyard and to expand its facility in Dahej.

Mr Rishi Agarwal MD of ABG Shipyard said that this is part of the company’s growth plans.

ABG’s proposed third shipyard has been planned with a view to constructing vessels measuring 350 meter in length, as compared to 250 meter at its existing facility in Gujarat.

Shipbuilders, including ABG and Bharati Shipyard Limited, are increasing capacity encouraged by the brisk demand for new vessel, that has been largely triggered by the rising oil and commodity prices. Internationally, shipbuilders, including ABG, have a backlog of orders right up to 2011.

New hydropower policy finalized for NE states

It is reported that centre has finalized a new hydropower policy for the North Eastern state, under which 1% power from a power project will be earmarked for the local area development fund.

The fund will be aimed at providing regular stream of revenue for income generation and welfare schemes for the local community. A capacity addition of 4,261 MW has been envisaged during the 11th Plan to meet the power requirements of the region.

The major projects to be taken up during the 11th Plan include Lower Subansiri hydro electric project of 2,000 MW, Kameng hydro project of 1,200 MW, Bongaigoan thermal project of 750 MW and Tripura gas project of 750 MW.

ICRA assigns LBBB rating to the term loan of Hazira Plates

It is reported that ICRA has assigned an LBBB rating to the INR 11.5 billion term loan facilities of Hazira Plate Limited. This is the moderate credit quality rating assigned by ICRA to long term instruments. The rated instrument carries higher than average credit risk.

Hazira Plate Limited has been promoted by Essar group and is setting up a wide width plate manufacturing plant at Hazira in Gujarat with a manufacturing capacity of 1.5 million tonnes per annum. The rating takes into consideration the experience of its promoters in the steel business.

Slabs would be sourced from other companies belonging to the Essar group with their plants adjacent to HPL’s plant. This is likely to keep HPL’s inward transportation costs nominal and working capital requirements under control. ICRA expects HPL’s strategic location, adjacent to a port, to provide the company with a freight advantage, especially for the Middle East market as well as key domestic markets in the western region.

In addition, the project being located in an SEZ would allow the company to enjoy fiscal benefits. The rating is however constrained by the risks associated with a large Greenfield venture, the cyclicality inherent in the steel business leading to variabilities in profitability and cash flows and a high project gearing of 1.49 times.

GAIL likely to award National Gas Grid Project phase I by May

It is reported that GAIL India is likely to award contracts for the first phase of National Gas Grid project by mid May 2008. The tender has already been issued and bids have also been received.

The first phase to be built at a cost of INR 14,500 crore, will comprise a pipeline length of 3,500 kilometer, will connect GAIL's existing terminals and extend up to the 1,600 MW Pragati Phase III gas based power plant at Bawana in North West Delhi. Petronet LNG will supply gas for the plant. The first phase is expected to be complete by 2009-10.

The second phase of the pipeline will aim at connecting terminals between Dabhol and Mangalore, Kochi and Mangalore and Jagdishpur and Haldia. It will have a length of 2,000 kilometer.

JK Tyres plans INR 480 crore CAPEX for 2008

It is reported that JK Tyres is planning to invest INR 480 crore to increase capacities of its truck and passenger radial tyres in 2008.

Out of the total investment planned for 2008, around INR 315 crore will be spent on augmenting its truck radial tyre capacity to 800,000 tyres from the existing 367,000 tyres and another INR 120 crore will be spent on off the road tyre capacity.

Indian Steelmakers Directory 2008

The fast developing Indian steel industries are continuing beyond what most believed was possible. As one of the world's fastest growing economies, India has become the most happening place among world steel market over last few years and thus is in the radar of most of global players associated with steel industry. But it is difficult and time consuming to contract them due to fragmented nature of industry and no comprehensive list of smaller steel makers was readily available.

Published in February 2008, “Indian Steelmakers Directory 2008” has been comprehensively researched and prepared, to bring you a fully up to date guide to India's rapidly growing steel makers. “Indian Steelmakers Directory 2008” is one the top sources of information available on steel making companies in India! It is one of the most comprehensive and accurate directory of Indian steel companies that have ever been published. This powerful directory is your connection to the entire Indian steel industries sector.

This Directory will be extremely useful to businesses that deal specifically with companies in the iron and steel industry, ferro alloys, consumable suppliers, raw material sellers, equipment makers and others. Whether you are a product manager, in charge of marketing, raw material seller, in equipment business or simply interested to remain in touch with the latest developments in the Indian steel industries, this directory will save you time and effort in finding the information you need.

This directory will enable you to profile steel makers in India, build new business prospects, generate new customers, discover who your competitors are and make vital contacts. You would save the time, money and effort of doing your own research. This directory has been especially compiled to assist with market research, strategic planning, as well as contacting prospective clients or suppliers. It is also an indispensable guide to India’s and steel industries.

Why spend hundreds of hours searching for new contacts? Invest in a copy TODAY! Whether you are buying or selling metals, minerals or steel products, this new directory will make an extremely worthwhile investment. Do not miss this opportunity to own your copy of this superb directory for the Indian steel makers in India.

This directory covers name and details of 720 of Indian steelmakers in Alphabetical as well as location wise order. The details given in the directory are basic only and covers company name, address and phone number. Fax number, email and website URL are also given where ever available. The directory is available as a PDF file containing 720 steel makers and has 396 pages.

Content
Company name -723 entries
Address-723 entries
Phone number-723 entries
Fax number -590 entries
Email -446 entries
Email -446 entries

Publish Date: February 2008
No. of Pages: 396
Price: INR 100,000 plus 12.36% service tax for Indian buyers
USD 2800 for overseas buyers
Delivery Format: PDF Format

You can order your copy to reports@steelguru.com, who will send you an invoice for the report

ArcelorMittal sees mid term increase in steel demand

French business daily Les Echos reported that ArcelorMittal sees that the global steel industry should grow by 4.5% a year over the medium term.

Mr LN Mittal president & CEO of ArcelorMittal during an interview told Les Echos that "Apart from western markets, all markets are going to grow. In these zones, there will be investment in infrastructure in housing and boats etc and for that, steel will be necessary. Ultimately, the market is in a situation of tension over the medium term.”

Mr Mittal added that his group would find it difficult to expand its current capacity.

SA steel exports in Q1 down by 15.5% YoY

According to a recent release from South African Iron and Steel Institute, carbon steel sales in South Africa in Q1 of 2008 rose by 2.2% YoY to nearly 1.5 million tonnes and by 20.5% QoQ.

Flat product sales in the quarter decreased by 5.5% YoY and long, products sale increased by 11.8% YoY. The dip in flat products is attributed to production outages and relines by ArcelorMittal South Africa.

Exports, meanwhile, slumped by a dramatic 31.8% during the first quarter of 2008 and totaled only 323 000 tonne. This was also a 39.2% decrease on export figures recorded for the fourth quarter of 2007. SAISI said that, during the first quarter of 2008, exports of flat carbon steel products amounted to 75% of total exports and exports of profile carbon steel products to 25% of total exports. But the export of flat products was also down 38.9% YoY.

SAISI said that imports of finished carbon and alloy steel products totaled 108 308 tonnes during the period.

Mozambique breaks ground for pipe mill at Maputo

It is reported that the construction works of a new steel pipe mill have been officially launched in the Industrial Park of Beluluane province of Maputo and is expected to start operating by the end of the current year. The project will budget at USD 44 million and initially employ 200 workers.

As per report the civil works are expected to be completed within the next 15 weeks and the equipment to be installed by the end of the current year, while commissioning in the first months of 2009.

Initially, the new plant will start with a production capacity of 200,000 tonnes a year that will be increased at a later stage to 700,000 tonnes, using raw materials imported from countries such as Turkey, China and South Africa.

With Africa and the United States being the main markets, steel pipes and tubing produced by this mill will be used for the construction of oil and natural gas pipelines.

This venture includes Mozambican and foreign companies, with the South African Capital Star Steel and Seven Star Group from China sharing a major stake, with 50% and 40% respectively. The remaining 10% are shared by a group of Mozambican companies, including Mozambique Zimbabwe Pipeline Company, Petromoc, Electricidade de Mocambique, Matola Gas Company and Petroline.

Indonesian to limit tin production

ITRI reported that officials of both the ministry of energy and mineral resources and ministry of trade of Indonesia have commented on proposals to limit Indonesian tin production at 100,000 tonnes per year.

Mr Mangantar Marpaung a director of ministry of energy and mineral resources told reporters in Jakarta that the government may issue a ruling in the next two months. He said that “We can not sacrifice our villages for the sake of those tin users.” He added that the mining minister will set a limit on national output, while the governments of tin producing regions will issue detailed rules.

A senior official at the trade ministry of Indonesia confirmed to the official Antara news agency that such plans were under discussion and added that controls on production were preferable to export quotas.

Mr Diah Maulida external trade director general said that “The government will limit tin exports. This policy has become a discourse among government ministries. The export restriction will be effected not through a trade minister's regulation, but through a production quota that will restrict producers' outputs. Restricting production will be more effective than limiting exports because export limitations can be manipulated by smugglers.”

The trade ministry already monitors and controls tin exports through a licensing system introduced in February last year. Various proposals to cap exports or production have been under discussion since last March.

(Sourced from www.itri.co.uk)

Power shortages pushing commodity prices - Goldman Sachs

According to analysts at Goldman Sachs Inc, a shortage of electricity generation that shows no sign of abating is underpinning gains in global commodity prices.

Mr Jeffrey Currie in a research note dated April 17 said that a lack of infrastructure in South Africa, Latin America, China and Australia has led to the disruption of feedstock supplies or halted power generation. This cut metals production and boosted demand for replacement fuels including diesel.

The analysts said that “One of the key themes that seem to pervade the entire commodities complex is the significant shortage of power generation throughout the world.”

Goldman analysts said that “the shortage of power generation highlights a longer term problem of infrastructure for mining, smelting and exploration activities in the broader commodities space, adding that more investments in capacity are needed.”

Commodities have entered a seventh year of rallies as demand from countries including China, the world's fastest growing major economy, expanded. Miners such as BHP Billiton Ltd are boosting production to keep up with demand. Rising energy prices and power shortages may stall capacity growth.

Zinc market underperforming over the last 18 months - Report

UK based consulting firm GFMS said that the zinc market over the last 18 months has been underperforming as compared to the other base metals.

It said that “From the recent high of March 4 of USD 2,806 per tonne the zinc cash quote fell to USD 2,260 per tonne at the end of the month. The average price in Q1 was USD 2,426 per tonne compared to USD 3,216 per tonne in the previous quarter and USD 3,446 per tonne a year earlier. The outcome for Q1 was slightly below our forecast of USD 2,500 per tonne.”

GFMS said that “The latest data from ILZSG seems to confirm our view that supply growth continues to outpace demand growth, particularly at mine production stage. It said that increased concentrate availability should allow a surge in Chinese refined zinc production and exports later in the year that will reverse the trend seen in the first couple of months of 2008. Weather related disruptions kept refined zinc output up to February largely unchanged from the corresponding period of last year at 565,834 tonnes.”

GFMS concluded that “It appears that zinc mining operations were not affected by the harsh weather conditions as domestic concentrate production rose by 24.3% YoY. In addition, the country has been sucking in concentrate from elsewhere. Imports in February were up 26% YoY at 129,000 tonnes on a gross weight basis. This follows the massive level of imports of 266,000 tonnes in January. Cumulative imports to February were 157% higher at 395,000 tonnes.”

Nippon Steel introduces new beam into the US

Purchasing.com reported that Japan’s Nippon Steel is marketing a new type of wide flange beam it is making available in the US which it hopes will prove popular in the competitive North American steel sections market.

The Hyper Beam whose flange thickness extends downward, rather than upward and offers a higher flange to web thickness ratio was unveiled to potential US buyers at the recent North American Steel Construction Conference at Nashville in Tennessee.

The downward flange design enables beams with varying flange thicknesses and weight supporting capabilities to maintain a uniform surface level or outer dimension. It is yet to be determined what lengths and widths will be available in the domestic market.

Nippon and two other mills currently sell about 500,000 tonnes per year of this type of structural section in the Japanese market.

Marubeni Itochu Steel America is the authorized distributor of Nippon beams in US.

Global demand for energy to increase by 40% by 2030 - ExxonMobil

ExxonMobil, the large US oil company, estimates that the international demand for energy will rise by 40% in 2030 and will total 325 million barrels of oil equivalent a day.

According to a report posted on the official website ExxonMobil, there will be a high demand especially in the developing countries. The rise in the international demand for energy will total to 1.3% by 2030.

ExxonMobil forecast that the fossil fuel will make up 80% of energy supplies, 60% of which will account for oil and gas. The rise in oil demand will total 1.2% per year and 1.7% for gas accordingly.

The renewable resources of energy will rise by 1.5% per year by 2030. The world demand for oil will go up from 86 million barrels oil equivalent per day up to 116 million barrels by 2030.

According to estimations from experts, in 2005/2030, the growth rates in Economic Cooperation and Development Organization will total 0.6% on average. The rise in the demand for fuel in Economic Cooperation and Development Organization will make up 1% to 2% on average during this period.

The growth rate for the demand for fuel in countries not included in ECDO will increase by 5 times and will total 3% per year.

Worldwide steel scrap shortage to hit Taiwan

Taiwan’s scrap imports in March 2008 totaled 665,000 tonnes, which may be the highest historical import quantity of scrap with 135% YoY increase compared with the same period of time last year.

US suppliers have announced that they will raise scrap price by USD 150 to USD 155 per long ton for March/April; sharply increasing price signifies that the market supply situation will be more serious.

This shortage of scrap suggests that the huge demand in Taiwan will not be satisfied. The situation has caused problem for mills which must either consider production cost or adjust selling price; the situation will become more serious in June.

(Sourced from YIEH.com)

Indonesian refined tin exports rise in March

ITRI reported that provisional data based on surveyors’ reports shows that the volume of refined tin inspected prior to export from Indonesia rose from 7,431 tonnes in February to 8,606 tonnes in March.

The latest figure was slightly lower than the March 2007 volume of 8,699 tonnes. The rise from February to March reflects seasonal factors and the resumption of shipments by PT Koba Tin.

Most Indonesian in transshipped via Singapore, which was the destination of 7,559 tonnes in the March figures. The other main destinations were Malaysia 477 tonnes and Japan 225 tonnes.

The surveyors’ reports are part of the export licensing system introduced by the Indonesian ministry of trade last February. In the twelve months to end March 101,417 tonnes of refined tin were checked for export.

(Sourced from www.itri.co.uk)

Queensland Rail and Asciano may seek partners

Bloomberg reported that Australia's biggest rail transporter of coal Queensland Rail may seek partners for expansion to cope with rising export sales by mining companies and competition from Asciano Ltd.

Mr Lance Hockridge CEO of Queensland Rail in a briefing said that “The business has to re position itself for the future. The scale of the growth opportunities is enormous. It is no mean feat for anybody to come in and take us on. We have obviously followed with considerable interest, if not amusement in some respects, the position that has been taken by Asciano. We will be a fierce competitor but a very fair competitor.''

Melbourne based Asciano, Australia's largest port and rail operator, plans to enter Queensland state's AUD 20 billion coal export industry, which produces more than half of the nation's coal. Asciano, owner of Australia's second biggest coal haulage company Pacific National, in December said that it would spend AUD 529 million expanding into coal transport in Queensland. The company said it was in talks with more than one coal producer in the state to seek a share of future output.

Queensland Rail, owned by the state government, is spending AUD 3 billion to improve networks and buy more locomotives after a lack of capacity stalled coal exports from companies including BHP Billiton Ltd. and Xstrata Plc. Queensland Rail's revenue from coal operations last financial year gained to AUD 1.15 billion, helping to more than double net income for the 12 months that ended June 30 to AUD 183 million.

Bottlenecks in the rail system and at the Dalrymple Bay port in Queensland have been blamed for delays in exports to steel companies and power utilities in Asia, sending coal prices to records. An independent review into coal transport efficiency in the state last July estimated AUD 1.2 billion in lost sales and higher shipping costs as result of the congestion.

Indonesian government advised not to sell PT Krakatau to ArcelorMittal - Report

ANTARA News reported that the State Enterprises Watch has asked the government on Sunday to drop its plan to sell state owned steel company PT Krakatau Steel to ArcelorMittal under a strategic sales scheme.

Mr Naldy Nazar Haroen chief of BUMN Watch said that “If the government was to privatize PT Krakatau, it should opt to an initial public offering to prevent foreign control of the company’s shares and avoid internal conflicts in the company.”

Mr Naldy said that foreign control of strategic state enterprises shares would not only harm the interests of the state and nation but also cause conflicts within the state companies in question. He added that "The track record of Mr LN Mittal in Surabaya is not quite good. During 30 years of its presence in Surabaya, it made no significant progress. In fact, its nail factory in Surabaya has even collapsed.”

Mr Taufiequrachman Ruki chief commissioner of PT Krakatau said that the government’s plan to privatize PT Krakatau under a strategic sales scheme ignored the company’s capability. He expressed optimism that without privatization PT Krakatau could raise its steel production to 5 million tonnes in 2011 from the current 2.5 million tonnes.

Earlier, Mr Sofyan Djalil state enterprises minister had said the privatization of PT Krakatau would help the company improve its performance.

Taiwanese steel plate market weakens

It is reported that Vietnam has also joined the resell line after South Korean traders resold Chinese plates to Taiwan.

The traders indicated that Vietnam has started to resell 20,000 tonnes to 30,000 tonnes of A 36 plates from China to the Taiwan market at a price of USD 940 per tonne CNF recently and some business has been carried out.

South Korean stock traders had resold China plates to Taiwan at C&F USD 940 per tonne CNF not long ago. However, the price was recently increased to USD 970 per tonne CNF.

Insiders have indicated that the resold plate quantity is over 100,000 tonnes, through South Korea’s reselling to Taiwan.

But Taiwan’s actual purchase quantity at present is unsure. In that case Taiwan’s plate market will be impacted under the effect of South Korea and Vietnam joining in the reselling.

(Sourced from YIEH.com)

Taiwanese seamless pipe imports in March jump by 60% MoM

Due to a serious shortage of billet, with continually rising prices, Chinese seamless pipe mills keep raising their price. As per report the mills have increased prices by USD 100 per tonne to USD 150 per tonne to Taiwan.

Taiwan imported 10,410 tonnes of seamless pipe in March 2008, a huge increase of 60% MoM compared with February. The main imports are from China. They have seen 83.42% increases, while Japan has been second, with a 24.5% hike.

As a result, Taiwan seamless pipes dealers said that sharply increasing imports of seamless pipe are mainly caused by steel stock holders tending to feed stock in consideration of price rises and billet shortage.

(Sourced from YIEH.com)

Shredded scrap exports from US up in February

The export of shredded scrap from US has risen by 14.5% to 513,644 tons in February due to robust demand from mills in Asia and Eastern Mediterranean.

US Department of Commerce has stated that ferrous still was considered as the major material for many overseas mills, which have also occupied nearly 33% of around 1.51 million tons of ferrous scrap export volumes such as South Korea taking 67,115 tons.

On the other hand, Turkey has imported the shredded scrap about 101,747 tons, increasing by 68.8% from few months ago. Also, Greece took double of 22,979 tons, Thailand has hiked by 47.5% from 65,049 tons and India took 30,462 tons which are two times as many as the total volume in January.

(Sourced from YIEH.com)

Eurogate to spend USD 1.7 billion for expansion in 4 years

Europe’s largest container terminal operator Eurogate is planning to spend USD 1.7 billion over the next four years to expand its facilities.

Eurogate in a statement said that the money will go toward enhancing Eurogate’s German facilities in Bremerhaven and Hamburg and upgrading several international projects such as in Morocco and Russia.

It said that the Bremerhaven facility will receive 14 gantry cranes and 127 van carriers over the next four years and the CT4 container terminal will be completed in October.

In Hamburg, the group will widen the third berth and is going to buy four gantry cranes and 176 van carriers by 2012. In addition, it will enlarge its terminal to the west to achieve an increase in capacity by 1.9 million TEUs.

French port workers extend strike

AFP reported that French port workers dug in Saturday as unions extended strike action at the country’s biggest cargo terminals in Marseille, Le Havre, Nantes and Rouen into next week.

Action against government plans to outsource part of the heavy machinery operations under an overhaul of France’s port system has been extended to Sunday at least with partial blockades also ordered throughout most of next week. The government is due to debate proposed legislation on Wednesday, according to union opponents.

Mr Pascal Galeote CGT union leader at the country’s biggest port, Marseille told AFP that “The strike against ports privatization will continue until Sunday. We are now into resistance territory we will take all necessary forms of action.”

Mr Galeote said the government had adopted a dogmatic position, ignoring consultations despite holding out the promise of negotiations. A full strike started on Thursday among crane drivers and signals operators, with the already privatized dockers and other handling staff also staging timed walk outs in support.

All cargo including petrol deliveries has been blocked in Marseille. At the port of Nantes Saint Nazaire, the crane-drivers’ protest was hardening although the petrol and gas terminal there was still functioning with Sunday blacked out and further disruption planned for Monday, Tuesday and Thursday nights, plus all of Wednesday.

ABB receives five FACT orders in Q1 of 2008

ABB has announced five orders in the first quarter 2008, totaling USD 25 million, to install flexible AC transmission systems for steel plants located in Australia, Egypt, the Republic of Korea, Russia and Turkey.

All of the contracts are based on ABB’s Static Var Compensators technology that is part of the FACTS solution portfolio. The power industry term FACTS covers a number of technologies that enhance the security, capacity, and flexibility of power transmission and distribution systems, as well as improving power quality and productivity in industry.

Mr Peter Leupp who heads ABB’s power systems division said that “ABB is a worldwide leader in FACTS. We have more than 500 installations in operation or under construction across the world and value the trust we have earned from customers in this growing market.”

Hanwha joins bid for Daewoo Shipbuilding

It is reported that the competition to take over Daewoo Shipbuilding & Marine Engineering grew fiercer with an announcement by Hanwha Group last week that it will join the bid. A decision on the preferred bidder is expected to come around late August.

As per report four other conglomerates have already expressed their intentions to bid for the shipbuilder, namely Hyundai Heavy Industries, POSCO, Doosan Group and GS.

The Korea Development Bank, the largest shareholder in the shipbuilder, with a 31.3% stake, welcomed Hanwha's participation. A Korea Development Bank official said that "We welcome any enterprise to the bid, as long as it has enough funds and sufficient management ability. We hope many potential buyers will participate so that Daewoo Shipbuilding can be sold at a good price.”

With Hanwha participating in the bid, the takeover price of Daewoo Shipbuilding will likely reach KRW 7 trillion more than double its value of KRW 3.5 trillion based on its current stock price, industry insiders predict.

Hanwha Group has operations in the energy business with its subsidiaries Hanwha Corp and Hanwha Chemical Corp. The conglomerate has also been exploring energy resources in Canada and Southeast Asia. Thus the group hopes to achieve synergy effects by taking over Daewoo Shipbuilding, which earns 76% of its sales on energy related ships such as oil tankers.

Global aluminum market in surplus: WBMS

According to the World Bureau For Metal Statistics, the global aluminum was in a surplus of 186,000 tonnes during the first two months of 2008.

The surplus was 25,000 tonnes in the same time last year. WBMS indicated that the demand of primary aluminum was 6.37 million tonnes, which was 423,000 tonnes higher compared to the same time last year.

(Sourced from YIEH.com)

Caterpillar Q1 net rises 13% on international sales

The world's largest maker of bulldozers and excavators Caterpillar Inc announced that its Q1 profit rose by 13% beating estimates as equipment sales in China, the Middle East and emerging markets grew about seven times faster than in North America.

Caterpillar said that sales increased by 18% to USD 11.8 billion, also topping analysts' predictions. Demand from mining companies in China and builders in Russia helped Caterpillar reaffirm its forecast for increases of as much as 15% in earnings and 10% in revenue this year. Net income climbed to USD 922 million from USD 816 million

Mr Birnstiel takes over as head of the press office of Siemens

Effective immediately, Mr Constantin Birnstiel has taken over as head of the Corporate Press Office of Siemens. His predecessor Mr Eberhard Dombek has been ill for the past few months and apparently will not be able to resume his work.

Mr Birnstiel has been working at Siemens since 1997 in various communications functions. Prior to his previous job as head of the Business and Financial Press department, he served as an Investor Relations manager at Corporate Finance from 2004 to the end of 2005.

Mr Stephan Heimbach head of corporate communications and government affairs at Siemens said that “I am pleased that Mr Birnstiel an experienced and highly professional colleague, is taking over this important position, and I look forward to continuing our close cooperation in his new function.”

Jordan cuts sales tax to maintain domestic steel prices

It is reported that Jordan has reduced the sales tax imposed on steel from 16% to 8% last week for maintaining current domestic market prices in case of further rises in steel prices on the international market.

The decisions are in line with His Majesty King Abdullah’s directives to the government to take necessary measures to protect citizens and curb prices.

UAE contractors want contracts with escalation clause

ArabianBusiness.com reported that in the face of rising costs, contractors no longer want to sign fixed-price contracts. The report cited some contractors in the UAE as saying that they are fed up of being forced into signing fixed price contracts as the construction cost crisis worsens.

Mr Philippe Dessoy GM of Besix said "We are quite fed up with the situation as our hands are tied. We sign fixed price contracts with developers yet suppliers keep raising their prices and eating into our budgets. Suppliers can not be blamed as the price of cement and aggregates are going up.”

Mr Thomas Barry GM of Arabtec Construction said that "Contractors definitely want cost-plus contracts, especially given the current circumstances. More and more attempts are being made by contractors to include the price escalation clause in contracts with developers. Fixed-price contracts are no longer safe and the risk factor is too high to make business sense any more.”

Rising materials costs have crippled the industry since the turn of the year, leading to several projects either grinding to a halt or being totally abandoned. But to correct the situation, cost-plus contracts need to be implemented now as contractors have already begun turning down jobs. But developers still prefer to execute projects through fixed-price contracts.

Oman shortlists 8 firms for power and desalination plant

ArabianBusiness.com reported that Oman Power & Water Procurement Company said that it has short listed eight international firms for the construction of a 400 MW power and water desalination plant in Salalah.

The eight firms are
1. US based General Electric
2. Spain's Union Fenosa
3. Japanese Mitsui
4. Japanese Marubeni
5. Malaysian Malakoff
6. Australian Transfield Services Infrastructure
7. Abu Dhabi's Mubadala
8. Singapore's SembCorp

The bids are expected to be opened on May 12th 2008, with the contract awarded three to four months later. The project will be awarded on a build, own, operate and transfer basis. The desalination plant will supply 15 million gallons of water per day. The power plant is expected to be in operation in the summer of 2009, while the desalination plant will be operational by mid 2010.

Water shortages looming in MEA

The amount of water per person in Middle East will be decreased to a half by 2050. The World Bank has warned that overuse of water resources in the Middle East has put the region at the risk of serious water shortages.

According to a report from the bank, the amount of water available per person in the Middle East, one of the world's most arid regions, will halve by 2050. However, the World Bank said that the crisis can be avoided if the regional governments tackle water waste, build more efficient networks and reduce water use.

Mr Julia Bucknall natural resource management specialist at the World Bank said that "We have simply got to reduce the amount of water used, especially in agriculture which accounts for 85% of the total. If we plan for the future, it is a lot simpler than crisis management further down the line.

Declining water quality has already decreased gross domestic product in Morocco, Algeria and Egypt by around 1% and almost 3% in Iran.

Pakistan announces privatization of NPCC

Pakistan Privatization Commission has decided to privatize the National Power Construction Company on May 5th 2008 and has sought EoIs from the potential bidders to acquire 51% shares along with management control. The decision was taken due to the increasing interest of parties in the transaction and to creating maximum opportunity for the investors in the related field.

National Power Construction Corporation Limited is a specialist contracting company of Pakistan for construction and management of turnkey power projects including extra high voltage transmission lines, distribution networks, substations, power generation plants, industrial electrification, external lighting of housing complexes etc. NPCC’s major area of operation during the last three decades had been in the Middle East with concentration in Saudi Arabia. NPCC has successfully secured and completed projects valuing over USD 650 million.

The Privatisation Commission has asked the prospective investors engaged in the engineering construction to submit EOI, providing information such as name of company, nature of business together with copies of constitutive documents proof of net worth of PKR 300 million as per audited financial statements.

Saudi to spend USD 119 billion on energy infrastructure

Trade Arabia News Service reported that Saudi Arabia is expected to invest USD 119 billion in energy infrastructure projects from 2007 to 2009.

As burgeoning energy requirements continue to mirror the current pace of economic development across the region, National Oil Companies including upstream, midstream and downstream operations in the Middle East are facing challenges such as ageing infrastructure and equipment, lack of efficiency in refinery processes and shortage in skilled manpower.

Mr Peter Venn business development director of Oil & Gas SAS Middle East & Africa said that "In this rapidly growing industry, it is essential to make quick but intelligent operational decisions to ensure efficiency and maximize productivity. By integrating our solutions within their operations, issues that traditionally take months for companies to make a decision on can now be dealt with in a matter of days, which leads to less risks, better recovery rates and increased efficiency and production."

Enabling companies to quickly create a logical data model that integrates all relevant data from simulations, process, product and equipment-related systems at multiple assets, fields and locations, SAS solutions provide companies in the oil and gas sector a holistic view of their critical operation data as well as additional information with regard to their customers, suppliers and service providers. Organizations can also benefit from the solutions by basing their decisions on data from a precise monitoring of their operations and business performance, thereby gaining them valuable efficiency and effectiveness advantages.

Mr Venn further added that "Energy requirements across the globe are growing at a very fast rate, and it is critical for companies to address challenges that arise within the entire production process to meet the growing demands. For a company to be successful amidst the massive extent at which the oil and gas sector is growing, it is truly a tremendous advantage to utilize a robust decision and collaboration tool. As an organization with extensive experience and a pool of highly trained professionals, we are fully equipped to address this need."

GCC suggested minimum wages of USD 445 per month

A poll conducted by Construction Week on the ideal minimum wage in the GCC, has revealed an average salary of USD 445 per month. People interviewed for the poll included contractors, consultants, architects, lawyers, embassy officials and construction workers.

The lowest suggested minimum wage was USD 245 per month in addition to free accommodation, while the highest was USD 954 per month in addition to free or subsidized accommodation. The most frequently suggested amount was USD 272 per month.

All labor sending countries to the GCC are considering the introduction of a minimum wage for their citizens. Talks of a minimum wage first surfaced when strikes by construction workers started to hit the UAE, with Arabtec and Besix being among the biggest firms to be affected.

Mr Bishoy Azmi GM of Al Shafar General Contracting said that "We have no objection to the introduction of an official minimum wage, because at the moment the minimum wage we are paying our workers falls between USD 218 and USD 272 per month anyway." According to Dessoy, the in house minimum wage at Besix is USD 250 per month in addition to food and accommodation.

Mr Riad Kamal chairman of Arabtec said that "When our workers went on strike in November 2007, we saw it as an issue for the whole industry. The consensus was that we should have a minimum wage."

Bangladesh has already introduced a minimum wage of USD 147 in Saudi Arabia. The Indian Ambassador to the UAE, Mr Talmiz Ahmed, said that there is already a minimum wage of USD 165 in the UAE for unskilled Indian workers, but that has not been updated since 2005.

Voltas secures USD 70.8 million deal from Empower

Arabian Business reported that engineering and air conditioning services provider Voltas has won a USD 70.8 million contract from Emirates Central Cooling Systems Corporation for the construction of a cooling plant in the north district of Dubai International Financial Centre.

Under the contract, Voltas will have to complete civil as well as mechanical, electrical and plumbing works in addition to the construction of the 66,000 refrigeration tonne district cooling plant. The project is expected to be completed in 15 months.

Mr Ahmad bin Shafar CEO of Emirates Central Cooling Systems Corporation said that "Voltas Limited was chosen for its successful track record in implementing massive projects, strict adherence to delivery schedules and its commitment to the highest international quality standards."

As one of the major engineering solutions providers for a wide spectrum of industries such as heating, ventilation and air conditioning, Voltas brings substantial expertise to our project deliverables.

UAE forex reserves surges by 50% to USD 75 billion

United Arab Emirates foreign exchange reserves surged by 50% in November 2007 to USD 75 billion.

That was the same month UAE Central Bank governor Mr Sultan Nasser Al Suweidi said that UAE was under pressure to drop its peg to the dollar and might consider linking to a basket instead.

Reserves jumped from USD 50.4 billion the month before, the biggest rise since data going back to 1990.

Global oil majors to help increase in gas supply in GCC

It is reported that the fast growing economies of the GCC face a looming energy shortage that can be addressed through increased cooperation between resource owning countries and international oil companies, utilizing the majors' global expertise in developing difficult hydrocarbons.

Mr Steve Peacock president of BP Middle East and South Asia said that "The trends we see in the Middle East are similar to other parts of the world there are plenty of hydrocarbons, but they are becoming more difficult and more costly to extract and unprecedented growth in demand means that supply is struggling to keep pace in some areas, especially for gas. This rate of demand growth and shortage of gas for power generation, desalination and industrial feedstock is putting some national growth plans at risk."

Mr Peacock said that "International oil companies, like BP, have significant global know how in achieving extraordinary recovery from existing oil and gas fields, in developing difficult gas and in tackling carbon emissions The challenge of closing the GCC energy gap presents an opportunity for governments and industry to work together in partnership. We can take best practices and processes developed from around the world and bring them to bear on specific national issues, in a way that is beneficial to all."

Iran and Turkey discuss investments in South Pars gas field

Today’s Zaman reported that an Iranian energy delegation met with officials from the Turkish Petroleum Corporation and the Turkish Pipeline Corporation and have made coordination for striking a deal by the end of 2008 for Turkey to invest in the development of phases 22 to 24 of the South Pars gas field.

The investment models in the 22nd, 23rd and 24th phases of the South Pars field, which will be developed and prepared for production by the TPAO, were discussed during the meeting.

A Turkish energy ministry official said that he does not see any reason for the agreement not to be signed this year. However, he noted that there had not been any concrete progress on the electricity deal signed with Iran.

The energy cooperation between the two countries now embodied in the MoU was criticized by the US, who has reminded Ankara of existing sanctions against Iran while also stressing a commitment to trans-Caspian energy projects that would bypass the Dardanelles and Bosporus Straits and Iranian routes.

The contents of the MoU seem positive for Turkey, which has long wanted to become an energy route between the energy rich Caspian region and Europe.

GCC can not escape from inflation – IMF

International Monitory Fund has warned that Middle East oil powers are using their increased wealth to weather the global economic strife but cannot escape the inflation that has been fueled by their main export. In Iran, consumer price index is at 20% and is near 14% in Qatar and above 9% in the UAE a 19 year high.

Growth across the Middle East remains strong at 5.8% across the region in 2007 and hitting 6.1% in 2008 and next. All the major oil exporters would see stable growth this year.

It said that “The region's economies are becoming more diversified and benefiting from improved policies and structural reforms that are underway in many countries. This should strengthen the resilience of the region to a slowdown in the advanced economies.”

Iran
Inflation in Iran is predicted to peak at 20.7% in 2008, leading a surge in prices across the Middle East. Iran's economy is predicted to expand 5.8% in 2008, unchanged from last year, before falling next year to 4.7%.

Saudi Arab
Saudi Arabia is predicted to see 4.8% growth in 2008, up from 4.1% in 2007 and rising to 5.6% in 2009.

Egypt
Egypt's economy is predicted to advance 7% in 2008 and 7.1% in 2009.

Lebanon
Lebanon's growth fell this year however to 3% from 4% in 2007 and is only predicted to start recovering next year at 4.5%.

Review on Chinese steel exports in recent years

Chinese steel export has maintained strong growth momentum over the years, which has helped ease the supply pressure on domestic market and beef up the competitiveness of Chinese steel industry in the global arena.

China steel export has surged nearly twelve fold from 4.85 million tonnes in 2001 to 62.64 million tonnes in 2007.The export growth has hit over 100% both in 2004 and 2006, but touched lower at 41.4% in 2005 and 45.5% in 2007.

China's finished steel products export during 2001-2007.

(In million tonnes)

East Asia and US are the main export destinations for Chinese steel products in the past, and HK, US, South Korea have always taken up the top three spots for quite a long time. However, the picture has changed now.

South Korea has overtaken HK to become the biggest buyer of Chinese steel exports for the first time in 2002, and hold on to that for six straight years. China has accounted for 20.5% to 26.9% of its steel imports during 2003 to 2006 the steel shipment to South Korea has slid to 11.6 million tonnes last year representing merely 18.5% of South Korea's total imports.

China's steel export to European Union has started to pick up since 2006 and the shipment volume has hit 11.1 million tonnes last year, with the average export price to EU surpassing that to South Korea by USD 166 per tonne. Meanwhile, emerging markets like Middle East, India and Southeast Asia have shown promising growth of steel consumption bolstered by robust economic growth.

In Middle East, China's steel export to Iran, UAE and Saudi Arab combined only reaches 160,000 tonnes in 2001 but soared up to 6.28 million tonnes last year with the growth rate over 200% in last two years. So far, China has sent 10% of its total steel exports to above three countries. Neighboring Southeast Asian countries like Vietnam, Singapore and Thailand have always been one of the major recipients of Chinese steel exports. Last year, the region has taken 10.54 million tonnes of steel exports from China representing 16.8% of the country's total export, almost level with EU.

China’s steel export to India has surged to 2.87 million tonnes last year from 14,000 tonnes in 2001 as the country has shown rapid economic growth in recent years. Mysteel analysts believe that India would continue to one of the major importers of Chinese steel products in years to come.

The shift in China's steel export structure has partially reflected the altering global demand. For examples, wire products have clawed back the strength last year as a result of booming infrastructure across the world. That's why the construction steel price rally has far exceeded that of flat products. However, tube/pipe export has been hampered by anti-dumping attempts in the major destinations.

(Sourced from MySteel.net)

Chinese iron ore import situation for 2008

Mr Luo Bingsheng deputy director of China Iron & Steel Association on the 2008 international metallurgy and minerals conference gave a speech on 2007 China iron ore import situation and analysis for 2008. Below are the major points of the speech.

1. Forecast of total import volume
In 2008 a number of uncertainties are affecting steel production in China, including enhancing of macro control, slowdown in GDP, fixed asset investment and foreign trade value, as well as climbing raw materials prices, squeezed profitability and weakening global economy. Against such background, steel production may be constrained, while the prices are predicted to stay on a high track, hinging on supply and demand correlation. Meanwhile, fluctuating prices would also impact on output, and help promote elimination of backward capacities.

According to forecast, crude steel production in 2008 can reach 520 million tonnes to 540 million tonnes up by 30 million tonnes to 50 million tonnes or 6.3% to 10.4% from 2007; pig iron may come to 500 million tonnes to 520 million tonnes up by 31 million tonnes to 51 million tonnes or 6.5-10.8%. If bf pig iron output stands at 520mt, there will be an additional demand of 81mt iron ore compared with last year.

It's predicted crude iron ore output would be 910 million tonnes around, 100 million tonnes more than in 2007 equivalent to 47 million tonnes iron concentrate. In this case, a gap of 34 million tonnes will be imported. Considering other factors, like inventory, it's estimated a total of 433 million tonnes iron ore will be procured from overseas market this year up 13% YoY.

2. The world iron ore trade situation, supply and demand
The three miners are expanding mining capacities. Vale exported 265 million tonnes ore in 2007 and plan to export 290 million tonnes in 2008; Rio Tinto produced 170 million tonnes last year and plans to add 15 million tonnes more this year; BHP made some 120 million tonnes, scheduling to raise 10 million tonnes. The above three are expected to increase ore supply of 50 million tonnes in addition, Australian FMG forecast to complete a 50 million tonnes per year ore project and operate it in May to provide 28 million tonnes around yearly; while India's supply on the international market may reduce 8 million tonnes on surging demand at home.

To sum up, additional supply of iron ore in 2008 could be 70 million tonnes, feeding steel production of China and the other regions. The supply and demand should keep balance generally, except periodical and regional tightness given scattered Chinese importers and monopolized market.

3. Marine transport
Since new delivery of ships keeps stable, the dry bulk shipping force may increase 6.8%, carrying volume up 7%; but the global trade volume, affected by US subprime mortgage crisis and slower growth in global economy, may decline and growth rate in bulk cargo shipment is possibly coming down from 2007, suggesting a balance of the market or even turning it slightly relaxed.

4. Ore import situation in January to February 2008
From January to February2008 China imported a total iron ore of 75.0039 million tonnes up by 10.4147 million tonnes or 16.12% YoY.

Average price of imported iron ore was USD 128.47 per tonne up by USD 58.96 per tonne or 84.28% from a year before; in terms of source, Australia accounted 28.5341 million tonnes taking up 38.04%; India accounted 16.857 million tonnes, taking 22.47%; Brazil accounted 16.4148 million tonnes, taking up 21.89%; South Africa 2.6806 million tonnes, 3.57% and other countries and regions 10.5174 million tonnes taking up 14.02%.

(Sourced from Mysteel.net)

US ITC to continue preliminary AD case on steel threaded rods from China

The United States International Trade Commission on weekend determined that there is a reasonable indication that a US industry is materially injured by reason of imports of certain steel threaded rod from China that is allegedly sold in the United States at less than fair value. All six Commissioners voted in the affirmative.

As a result of the Commission's affirmative determination, the US Department of Commerce will continue to conduct its antidumping investigation of imports of this product from China, with its preliminary determination due on or about August 12th 2008.

The steel threaded rod in this investigation is made from carbon steel, can be any length or diameter, and into which threaded grooves have been applied along its length. A variety of finishes or coatings, such as a plain oil finish, zinc coating, paint, and other similar finishes and coatings, may be applied to the merchandise. Threaded rod is primarily used in commercial construction to suspend conduit, pipes, and ductwork. Normally one end of the threaded rod is fastened to the ceiling and the other end is fastened to the support that is holding the pipes or ductwork.

U.S. Imports
1. From China during 2007 – USD 28.8 million
2. From other countries during 2007 - USD 8.9 million
3. Leading sources during 2007 - China and India.

Beijing to ban construction projects during the Olympics

It is reported that China recently unveiled ambitious plans to improve its capital's heavily polluted air in time for the Olympics, including halting construction and heavy industry. Beijing's Municipal Environmental Protection Bureau laid out a range of tough measures to cut back pollution, such as closing numerous petrol stations and even banning spray painting.

Mr Du Shaozhong deputy director of the bureau warned that even more strident measures would be taken if the weather remains unfavorable by the time the games begin in August. The month is regarded as one of the worst in terms of pollution in the city because the air is humid and often stagnant.

Since March, some types of construction work have been banned on windy days. But from July, all digging and pouring of concrete on sites will be suspended for two months. Production will be stopped at cement, concrete mixing and cement grinding plants in south east Beijing. Nearby quarries will also cease to operate. About one in 10 petrol stations will be closed at the end of next month, while many more will be fitted with devices to reduce the level of fuel fumes they produce. Outdoor spray painting will also be banned during the period as will spraying or painting with "harmful solvents".

Nineteen heavy polluting companies also have been told to cut their emissions by another 30% from July and coal burning boilers that fail to meet emission standards will be closed. Factories in areas surrounding the capital including the city of Tianjin, the provinces of Hebei, Shanxi and Shandong; and the huge Inner Mongolia region will also shut down during the summer.

Officials have not yet published their traffic plans, but are expected to ban about half of Beijing's 3.3 million vehicles during the games to reduce pollution. They have also said they may encourage residents to take holidays, to reduce congestion. But international teams competing in the Olympics are pursuing their own solutions in advance of the games in case organizers fail to meet the targets for air quality. The US has developed special masks for athletes which include a carbon filtration system.

Baosteel automotive sheets sales in Q1 up by 81% YoY

It is reported that the sales of exclusive products and leading products of Baosteel automotive sheets demonstrate a cheerful trend which reached 158,000 tonnes and 408,000 tonnes in the first quarter respectively up by 81% YoY and 7.4% YoY.

In the first quarter, among the exclusive products of automotive sheets, pickled, CR and electro galvanized products account for a large percentage, among the leading products CR and hot dip galvanized products become the main force.

Moreover, the R&D and production of new products of automotive sheets in the first quarter are pleasing as well, with 12,000 tonnes of new products produced accumulatively and the annual planned target is accomplished above quota, among which the high strength steel series that is in short supply in the market accounts for the absolute majority.

In 2008 by bringing the synergetic effect into play, the production, sales and R&D team of automotive sheets closely links the site with the market, keeps optimizing the product mix, strengthens the market development and continues to cement the halt share in domestic automotive sheet market with advantageous products.

China Railway wins USD 263 million construction deal

Reuters reported that China Railway Group has won a CNY 1.84 billion (USD 263.1 million) contract for a domestic railway construction project.

In a filing with the Shanghai stock exchange, China Railway Group said it would build a 70 kilometer railway in the southwestern province of Yunnan and the value of the contract represented 1.1% of its 2006 revenue. It added that the project would take 1,796 days to complete.

China Railway Group raised USD 5.5 billion in a dual Shanghai and Hong Kong listing late last year, attracting strong investor interest as it benefits from massive infrastructure spending in China and expansion overseas.

Caofeidian refuses polluting and energy intensive projects

It is reported that Tangshan has refused over 60 high polluted and high energy consumption projects last year among which Caofeidian refused the projects with the investment of more than CNY 10 billion.

Mr Cao Zhanhua introduced Tangshan was striving to adjust and optimize the industrial structure in order to improve resources maximum utilization. He said we did not choose the high pollution and high energy consumption projects even the projects with huge investment and high profits.

At the same time, they will eliminate the obsolete capacity to promote the energy saving and close 901 enterprises with high pollution and high energy consumption.

Chinese ports throughput to surpass 5.6 billion tonnes by 2010

It is reported that a well developed port network will take shape in China by 2010 when Chinese ports are expected to handle 5.6 billion tonnes.

As per report China will reportedly have established a port oriented international container transport network and a bulk network by 2010, making it a strong shipping nation with more rational port layout, further improved port capacity, more diversified port services and more advanced port facilities.

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

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

In million tonnes

(Sourced from MySteel.net)

China steel export recovery to spread into months ahead

It is reported that China's finished steel exports rebounded in March to 4.16 million tonnes after dipping in February to their lowest since May 2006 at 3.11 million tonnes. The export downslide has far beyond the market expectation and most believe the steep export price is the major reason.

However, March's finished steel exports were down by 22.6% YoY and the export volume in the first three months of this year now stands at 11.39 million tonnes down by 19.3% YoY. China exported 10,000t of semis in March, up from 2,500 tonnes in February. The total semis export volume in the first three months this year is 90,000 tonnes down by 95% YoY. Semis export volume has slumped dramatically during February to March and even hit the bottom at 16.52 million tonnes in February.

Beijing has further increased the export taxes on certain products as of January 1st 2008. As a result, export volume of low value added products including semis, pig iron, wire rods, rebar and narrow strip all has posted sharp decline in the first two months of this year. China's steel products export during January to February 2008

(In million tonnes)

Chinese mills and traders had widely anticipated the surge, given export prices have been rapidly strengthening since early March and Feb export volume has been fairly low due to the shortened month and severe snowstorm.

(Sourced from MySteel.net)

Shagang enters long term COA with Agelef

Interfax China reported that southeast China based Shagang Group, China's largest private steel mill entered into long term iron ore contracts of affreightment with Agelef Shipping Co Ltd.

The official said that the COAs include a 10 year shipping contract and a 5 year new carrier contract to deliver Shagang's imported iron ore. However, the official did not disclose the volumes contracted or when the contracts come into effect.

According to a recent company announcement, Shagang has been expanding the volume of quality iron ore it has been importing in order to aid business development. It expects to import 19 million tonnes of iron ore this year up by 3 million tonnes or 18.75% from last year.

Shagang already holds a number of other contracts for iron ore delivery and the new COAs with Agelef will further boost supply. The report added that in June 2007 Shagang inked a 13 year iron ore COA with South Korean based STX Pan Ocean Co Ltd for the delivery of 11.52 million tonnes of Brazilian iron ore between 2008 and 2010.

Release of steel exporters qualifications has no timetable

It is reported that China is likely to release norms for steel exporter qualification soon.

Mr Chen Xianwen head of market survey department of China Iron & Steel Association at the sideline of the 3rd International Steel Forum April 10th 2008 informed that the qualification standards have not been finalized as yet but it is for sure that they will be put into practice soon.

Mr Chen said that the thresholds, export volume in past years may not be a suitable measurement for a qualified exporter. He said quality should be stressed rather than quantity and enterprises' being in line with industrial policy and environmental protection standard are of great importance. He added that if steel export resurges in April and May, regulatory measures will be taken soon, but the measures are still being studied now.

Mr Luo Bingsheng deputy director of CISA on the meeting said "I think making thresholds for steel exporters are necessary, they are requirements of the industry. He suggested that qualifications of the exporters should be gradually improved so as to raise the industrial thresholds ultimately. This is constructive to build a healthy steel import and export trade order in a long term.”

As a result, small and medium exporting enterprises may be cracked down and export by the middlemen will thus plunge which is more risky and less profitable.

Recession reports - China should draw lesson from subprime crisis

Xinhua reported that China should draw a lesson from the subprime mortgage crisis in the United States and strengthen risk control and supervision in its financial reforms.

Mr Liu Mingkang head of the China Banking Regulatory Commission, said that China's financial reforms aimed to open the market wider and the crisis would not change the fundamental direction.

He said "The crisis reminded us that China's financial industry must open step by step to the outside world. Otherwise, we will be incapable of coping with the accompanying risks and problems. Supervision and monitoring is very important."

Mr Jiang Jianqing chairman of the Industrial and Commercial Bank of China said supervision should be stricter in the future and the government should have problematic financial institutions go out of business to make the market more efficient. He said "Financial institutions, especially those in emerging Asian economies, should diversify their investments to spread risks. Corporate governance plays a very important role in risk control. Board members with different expertise and experience will give advice on risk management from different angles."

Mr Lord Leon Brittan vice chairman of UBS Investment Bank recognized that it was wise and correct of China to promote financial liberalization in a gradual and orderly manner. He said China's financial industry should not open further wider until it was well prepared in corporate governance and in dealing with bad debts and assets. He added that agreeing that the government is obliged to supervise financial institutions and too much interference would lead to higher costs.

Ilyich net income in 2007 up by 55.6% YoY

According to Unian, Maripiupil based Illich increased its net income to USD 280.6 million up by 55.6% YoY in 2007. Over the period trade receivables dropped to USD 425.6 million down by 15% YoY.

The announced preliminary results show a decreasing trend in MMKI's net income in the last three quarters of 2007. Namely, it went down from USD 136 million in Q2 2007 to USD 70 million in Q3 2007 and USD 10 million in Q4 2007.

Millennium Capital analysts said that “It is not a secret that MMKI is unsecured in iron ore and coke supplies. This reflected in the plant's financials, which have been dramatically worsening due to sharp increases in the prices for raw materials which started in H2 2007. However, we do not exclude that MMKI could improve its financials in the current year by passing higher costs to its consumers by setting higher prices for steel.”

(Sourced from Millennium Capital)

Stalprodukt to become majority shareholder in Cynk-Mal SA

Stalprodukt SA announced that it has signed a letter of intent to start negotiations with Cynk-Mal SA based in Legnica in Poland on a contract, pursuant to which Stalprodukt SA would acquire a new share issue of Cynk-Mal SA and acquire a 51% stake in the company.

The share issue of Cynk-Mal SA will be directed solely to Stalprodukt SA. The terms of the possible contract will be determined by May 15th 2008.

Nizhnodniprovsk Pipe net in 2007 down by 23.2% YoY

According to an official statement by the plant, Nizhnodniprovsk Pipe Plant's net income dropped to USD 85.8 million down by 23.2% YoY while net sales grew to USD 929.3 million up by 23.1% YoY in 2007.

(Sourced from Millennium Capital)

Russia and China examining pipeline project

Interfax cited Mr Andrei Dementyev Deputy Russian Industry and Energy Minister, during the International Pipeline Forum in Moscow, as saying that the Russian and Chinese sides have decided to develop project documentation for the construction of the oil pipeline from the system Eastern Siberia to Pacific Ocean oil pipeline to China,

He said "For now, all project work has practically been concluded. To begin construction of this branch, China will need to agree with the Russian side on filling the pipeline. What matters is who will make supplies and what supplies will be made on this section. If China agrees with Russian partners on supplies and on the volume of oil, then they will make decision on the beginning of construction of this branch.”

He added that neither Transneft, nor China seeks to build the pipeline so that it should be idle."

The Eastern Siberia Pacific Ocean oil pipeline is being built to transport oil to the Asia Pacific market. The project is planned to be implemented in two stages.

1 It is envisioned to construct a 2,400-kilometer-long pipeline section Taishet Skovorodino and to erect oil loading terminal on the Pacific shore with an annual capacity of 30 million tons of oil. It is planned to transport oil from Skovorodino to the Pacific by rail.
2. It is planned to construct oil pipeline section Skovorodino Pacific Ocean and to increase the capacity of the ocean terminal. It is planned that in case of construction of this branch to China, 30 million tonnes of oil will be transported yearly and 50 million tonnes of oil on the route Skovorodino Pacific.

It was planned that the construction of the first stage of the ESPO pipeline would be concluded by late 2008. Yet in the fall 2007, Transneft said that it would be able to conclude it only in the fourth quarter of 2009. In early 2007, Russian Industry and Energy Ministry submitted to the government proposals to postpone the terms of construction till 2009.

MNP to buy Krasnye Barrikady shipyard

It is reported that the owner of Krasnoye Sormovo has filed a request with the Russian Antimonopoly Service to buy 100% of Krasnye Barrikady Shipyard.

As per report analysts assess the plant’s worth at about USD 45 million. Astrakhan based Barrikady builds dry cargo ships and tankers and was founded in 1886. MNP also owns Volgograd Shipyard.

Russia cancels Libyan debt in exchange for contracts

It is reported that Russia cancels Libya USD 4.5 billion debt in exchange for contracts for Russian companies worth several billions of dollars.

The debt abrogation was part of an intergovernmental agreement on bilateral economic and financial relations signed by visiting Mr Vladimir Putin Russian President and Mr Muammar Qaddafi Libyan leader. The parties announced their intention to strengthen cooperation in the areas of national security and defense, particularly through closer ties between the bodies involved.

After the signing ceremony, Mr Putin told reporters “We are satisfied with the way we have resolved this problem. I am absolutely convinced that the scheme we have arrived at will benefit both Russian and Libyan economies as well as the Russian and the Libyan people.”

Mr Putin said more than ten agreements were reached, including a contract for the Russian Railways worth more than USD 2 billion. An agreement on military cooperation was also signed.

Russia and Libya also agreed to collaborate in arms control measures, nuclear non-proliferation and disarmament, to boost efforts to turn the Middle East into a zone free of weapons of mass destruction and to reduce military operations in the Mediterranean in order to make it a region of peace, stability and cooperation.

Mr Alexei Kudrin Finance Minister of Russia told reporters that the size of Libya's debt to Russia had been brought down by USD 100 million from USD 4.6 billion to take into account Russian state bank VTB's debt to Libyan companies.

Russian GDP in Q1 2008 up by 8% YoY

Interfax quoted the Russia Economic Development and Trade Ministry said in a statement that Russia's GDP grew 8% YoY in the first quarter of 2008 compared to the same period of 2007. The Federal State Statistics Service said GDP grew 7.4% in the first quarter of 2007.

It was reported earlier that Russian industrial production increased 6.2% in the first quarter of 2008, agricultural production up by 4.5%, retail turnover up by 16.7%, fixed capital investment up by 20.2% and real wages up by 10%.

The ministry said Urals oil cost an average of USD 93.6 per barrel in the first quarter of 2008 compared to USD 54.2 in the same period of 2007.

Russian foreign trade increased 50.3% in the quarter, including a 55.2% rise in exports and a 41.6% increase in imports.

The Economic Development and Trade Ministry recently issued an updated economic forecast for the period until 2011, raising the GDP forecast for 2008 to 7.6% from 7.1%. Russian GDP grew 8.1% in 2007.

Gazprom Czech unit signs agreement with MND on gas storage

Thomson Financial reported that Czech privately owned oil and gas group Moravske Naftove Doly signed a MoU with Gazprom's Czech unit Vemex on cooperation in the Czech Republic.

Moravske Naftove Doly said the biggest oil and gas mining group in the Czech Republic plans to build and operate a new underground gas storage facility in cooperation with Vemex but final conditions still need to be negotiated.

A Moravske Naftove Doly spokesman said costs to build the storage unit could reach 'several billion crowns. He said MND posted 2007 pretax profit of 1.5 billion crowns and estimates its asset value at 9.5 billion crowns.

SASSDA warns of substandard material into SA market

Southern Africa Stainless Steel Development Association has advised that there have been cases of substandard and under specification stainless steel being imported and sold in South Africa. Against this background, the association said that buyers of primary and secondary products, such as plate and sheet, bars, rods and sections of tube and pipe, must insist on a test certificate when buying.

The substandard and under specification stainless steel is a result of a small and limited tonnage of imported stainless steel decorative tube, which was affected because of an increase in the nickel price, which drove up the price of certain grades of stainless steel. As a result, a few importers decided to import a small tonnage of nickel free stainless-steel decorative tube and, as the importers were not familiar with the different grades of stainless steel and their correct applications, the material failed in service.

Mr Michael Campbell MD of Southern Africa Stainless Steel Development Association said that the grade of decorative stainless steel tube imported by these opportunists is not fit for purpose and carries no test certificates, resulting in shipments being rejected by many stockiest and by the end markets, such as the architectural, building and construction sectors.

Mr Campbell added that "The test certificate is the only way to confirm that material meets international chemical and mechanical specifications. Without this certificate, buyers should be aware that the product they are purchasing will not have a guarantee of origin and, as such, they will have no recourse should the product fail in any way, or suffer from accelerated corrosion."

Mr Campbell said that by insisting on this procedure, the possibility of under specification, nonconforming stainless steel entering the South African market is limited, as is the liability of the producers, importers and end-users.

However, Sassda has stressed that the engineering industry, including the petrochemicals, chemical, food and beverage, pulp and paper, and sugar sectors, has not been affected by the importation of substandard, under specification, and nonconforming stainless steel input materials. Mr Campbell concluded that "Only a small, limited tonnage of decorative stainless steel tube that was imported was substandard and under specification. The organization has implemented the necessary control procedures and has the full support of industry in insisting on test certificates with all stainless steel that is bought and sold."

US probing Chinese SS imports for Cuban nickel

It is reported that the US’s Office of Foreign Assets Control is investigating the alleged use of Cuban origin nickel in stainless steel exported to the United States from China.

Mr David A Hartquist counsel for the Specialty Steel Industry of North America while speaking at AMM's Stainless and Its Alloys Conference in Pittsburgh last week said that OFAC has launched a probe after the association raised concerns that the imported stainless could contain nickel from Cuba and therefore violate long standing US sanctions.

Mr Hartquist said that “SSINA believes that the use of Cuban nickel by Chinese stainless steel producers is another challenge facing US stainless steel producers that are trying to compete with cheaper material produced in China. The law exists and it should be enforc