Essar Steel eyeing Wheeling Pittsburg - Report

ET recently reported that Essar Steel, along with Severstal, is in the race to buy Wheeling Pittsburgh Steel Corp from Esmark Inc, which completed its takeover of the local steelmaker in November 2008.

The Economic Times also said that Essar Steel had no comment on the deal.

Mr Craig Bouchard president and vice chairman of the board of Esmark, declined to comment by saying that it would not be appropriate because Esmark is a publicly owned company.

The value of the Wheeling Pittsburgh has been at issue recently, as Esmark prepared federally required financial reports on year end and first quarter data.

Wheeling Pittsburgh manufactures a variety of steel products ranging from hot rolled coils, cold rolled coils, galvanized sheets to pre painted and tin mill sheets. The company’s annual capacity is estimated to be 2.5 million tonnes of flat steel.

NMDC to go solo on steel project in Chhattisgarh - Report

BL reported that National Mineral Development Corporation plans to set up a 3 million tonne a year steel plant on its own in Chhattisgarh and one of its JV partner Steel Authority of India Ltd is no longer involved with the project.

The report cited a SAIL spokesman as saying that “NMDC will go and build the plant on its own. As far as we are concerned, we have our ambitious expansion plans lined up in all our plants for the next three years. We will continue to focus on them.”
NMDC has identified land near Dilmilli village in Bastar district in Chhattisgarh and currently public sector MECON is preparing the techno economic feasibility report for the proposed plant. The new plant would be set up subject to the availability of land from the State Government and also on the availability of linkages for key raw materials, water and power, official sources said.

In August 2007, NMDC, SAIL and Rashtriya Ispat Nigam Ltd had signed a MoU to set up 4 million tonne integrated steel plant in Chhattisgarh through a joint venture company. This MoU will now be scrapped and NMDC will go it alone for the project whose capacity has also been revised.

However, RINL will remain linked to the project to provide technical support to NMDC in the areas of project management and construction related activities.

JSPL to start iron ore mining at El Mutun by 2008 end

It is reported that Jindal Steel & Power Ltd, which received a license from the Bolivian government for exploration work at the El Mutun iron ore mine, expects to start iron ore mining by the end of 2008.

Mr Navin Jindal vice CMD of JSPL told reporters that “We expect mining to start by the end of this year.”

JSPL plans to invest USD 2 billion in the mining and steel project in Bolivia. It will set up a 2 million tonne steel plant, which is expected to be completed by 2011. It also intends to set up a 6 million tonne sponge iron unit in Bolivia.

SAIL firming up coking coal import plans for 2008-09

BL reported that Steel Authority of India Limited has proposed to import an estimated 12.5 million tonnes of coal in the current fiscal as compared to 9.7 million tonnes in 2007-08. But the distribution of the projected import among the 3 east coast ports namely Haldia, Paradip and Visakhapatnam, is yet to be finalized.

For 2007-08, SAIL initially had set the coal import target at 13 million tonnes to be divided among the 3 ports in the following proportions
Haldia – 6 million tonnes
Visakhapatnam – 5 million tonnes
Paradip – 2 million tonnes

Subsequently, the target was revised downwards in view of the uncertainty over coal availability in the international market, particularly the problems at the loading ports in Australia. The revised target was set at 10.26 to be divided among the 3 ports in the proportions of
Visakhapatnam – 4.32 million tonnes
Haldia – 4.66 million tonnes
Paradip – 1.28 million tonnes

However, the year ended with a total import of 9.7 million tonnes and the distribution among 3 ports was
Visakhapatnam – 4.03 million tonnes
Haldia – 4.59 million tonnes
Paradip – 1.08 million tonnes

RINL to gain after inauguration of Gangavaram Port

BL reported that Gangavaram Port is getting ready for operations, with 5 berths in the first phase and the inauguration may take place sometime in May or June 2008. The commissioning of the port is a welcome development for the Rashtriya Ispat Nigam Limited as it is situated in the backyard of the plant, enabling the latter to cut down substantially on freight.

As per report, RINL and the Gangavaram Port have come to an understanding, reserving two berths for the plant for its imports and exports.

Currently, RINL imports 3 to 3.5 million tonnes of raw materials, mainly coking coal from Australia, limestone, boiler coal and iron ore pellets. The material is discharged at the Visakhapatnam port in the inner harbor and brought to the plant by rail.

Commissioning of Ganaavaram Port is likely to help RINL cut costs of raw materials due to following reasons

1. It is estimated that the plant spends INR 120 crore to INR 130 crore a year on rail freight and with the commissioning of the Gnagavaram port, the need for rail transport is obviated as the material would be imported at Gangavaram and taken to the plant through conveyor belts.

2. Gangavaram port has the deepest draft in India with 21 meters dept as against the 11 meters to 12 meter of the inner harbor at the Visakhapatnam port making it capable of handling Capesize vessels. According to rough estimates, it may be possible for RINL to save 30% or so on oceanic freight or at least USD 5 to USD 8 a tonne.

3. As Gangavaram is a new port with fully mechanized un loading facilities and there is no congestion, the discharge of material will be much faster and there will not be any hassles. This would again bring down the ocean freight rates to some extant.

RINL also exports about 600,000 tonnes of pig iron and steel products and can utilize this facility, if exports continue.

Minerals push Indian inflation rate to 7.33%

It is reported that a steep increase in mineral prices, including iron ore, led to the wholesale price index-based annual rate of inflation rising 7.33% in the week ended April 12th 2008 much higher than the 6.34% in the same week last year.

Iron ore prices rose by 54.77% while prices of other minerals rose 12.28% over the same period last year. On the whole, the minerals group in the index rose an annual 50%.

There is a strong sense of expectation that spike in iron ore prices may prompt the government to impose many measures shortly. An inter ministerial group had discussed the measure earlier this month, but a consensus could not be arrived then. The latest data increase the probability that the government will implement the measure aimed at discouraging iron ore exports, thereby augmenting domestic availability.

Chinese power equipment gain major grounds in India

It is reported that Chinese power equipment suppliers are fast gaining market share in India. As per report, as many as seven Chinese makers including Dongfang Electric Corporation, Shanghai Electric and Sepco Electric Power Construction, have cornered 20% of the market for new equipment supply to new power ventures in India.

Indian government has firmed up plans for adding 78,000 MW of Greenfield thermal capacity by 2012. Out of this, orders for 71,000 MW have already been placed, while Chinese equipment vendors have secured orders for about adding 16,000 MW of Greenfield capacity.

The orders bagged by them so far are
1. Dongfang Electric Corporation - 2,400 MW
2. Shanghai Electric - 5,800 MW
3. Sepco Electric Power Construction - 4530 MW

The details of project wise orders is as under

1. Dongfang Electric Corporation - West Bengal Power Development Corporation Limited’s 600 MW unit at Sagardighi
2. Dongfang Electric Corporation - Durgapur Projects’ 300 MW unit in Durgapur
3. Dongfang Electric Corporation - Lanco Amarkantak Private Power’s Pathadi thermal power project in Chhattisgarh for 600 MW
4. Shanghai Electric - Haryana Power Generation Corporation’s 1200 MW Yamuna Nagar thermal power station in Haryana
5. Shanghai Electric - Haryana Power Generation Corporation’s 1200 Rajiv Gandhi Thermal Power Plant at Hisar in Haryana
6. 1000 MW units at Rajwest Power plant at Barmer in Rajasthan being set up by JSW Rajwest Power
7. Supply of boiler turbine generator for Damodar Valley’s 1200 MW Raghunathpur project
8. Supply of boiler turbine generator for 1200 MW to Rosa thermal power project in Uttar Pradesh for Reliance Power.

Mr Jairam Ramesh union minister of state for power said that "In the 11th Five Year Plan, 20% of equipment supplies for 78,000 MW of fresh thermal capacity have been bagged by seven Chinese companies and they have offered strategic prices for nearly all projects they have bid for. We should ensure that maximum new equipment supplies should come from Indian manufacturers. However, if Chinese companies set up shop in India it is all right, but I am against direct imports."

Sesa Goa to consider stock split & bonus issue

Sesa Goa Limited has informed BSE that its board of directors at their meeting to be held on April 28th 2008 will also to consider the following

1. Sub-division (split) of the Equity Shares of the Company.

2. Issue of Bonus Equity shares.

AIAECC urges for steel regulatory authority to monitor prices

FE reported that All India Association of Engineering Construction Contractors has urged the government to set up regulatory authority for monitoring steel prices in India.

Mr Mahesh Mudda chairman of AIAECC said that "The domestic engineering construction industry which has shown phenomenal growth over the last couple of years contributing significantly to economic improvement is being badly hit by the spiraling prices of major inputs like steel and cement."

He added that "We have also urged that the government should put ban on futures trading in steel and also ban exports of steel products as prices have gone up substantially in recent time."

AIAECC has around 9,000 direct members from across the country involving more than 90 centers including 30,000 indirect members falling under the various regional contractors affiliated to the Builders’ Association of India.

Indian Railways reported to be facing effect of high steel prices

Mint reported that India Railways has begun to feel the pinch of rising steel prices with contractors refusing to complete work on bridges and other projects unless they are compensated for the steep hike in the price of inputs, particularly steel. As a result, the railways runs the risk of a major setback to its plans to ramp up freight capacity, which is currently operating at its peak, through a big step up in capital expenditure.


An official at the railway ministry said that, earlier this week, a delegation of 25 contractor associations from all over the country had held a meeting with the railway board, the apex management body of railways. He added that "The contractors could not complete the work unless they were compensated for the steep hike in steel prices and other input costs."

As per report, vendors who supply finished steel and other components used for manufacturing coaches and wagons, too, are backing out of contracts they had signed with the railway ministry. According to another railway ministry official, the Railway Coach Factory in Kapurthala has also been affected with vendors stopping supply of steel in the last two months, forcing the unit to renegotiate terms to avoid any stoppage in production. He added that "We are canceling existing contracts and signing them anew with the vendors so that they carry out the orders. We have been facing a shortage of steel for the last 3 months and reports coming in from all the zonal railways also suggest that some work is beginning to get affected."

However, an official at SAIL claimed the supply of rails to railways was being maintained. He added that "We supply around 700,000 tonnes of steel to the railways every year and we have been meeting their order requirements. However, when it comes to the problems they face with contractors, the railways must realize that this is an issue that is faced by almost every industry right now."

Bhutanese builders facing slowdown due to high steel prices

It is reported that the rising prices of rebars are beginning to effect builders in the construction industry of Bhutan resulting in a slow down in activities. The report cited Mr Tshewang Dorji a contractor in Thimphu as saying that market prices of TMT bars, nails and screws have shot up by 25%, delaying ongoing construction work.

As per report, prices of iron and steel had risen by 47.5% since October 2007. This is being fuelled, in addition to external factors like international price levels and cost pressures due to high raw material costs by the fact that the average demand for steel in Bhutan has gone up by 14%, whereas the production had increased by only 5% annually.

Some of steel makers and rerollers in Bhutan, located at Pasakha said that "With prices of input materials increased, industries under pressure have no choice but to increase the prices of their products."

Ms Sonam Dechen an official of Bhutan Concast said that "Rise in price of metals is a global trend with markets being volatile."

Of the 4 iron and steel industries in Pasakha, the Bhutan Concast Private Limited, which started production recently, has a total capacity of 5,000 tonnes of steel billets per month. The other 3 together produce 2,500 tonnes a month.

Indian Railways to buy 20,000 wagons from Titagarh in 2009

Mr Umesh Chaudhry MD of Titagrah Wagons Limited recently said that Indian Railways would be buying 20,000 wagons from Titagarh Wagons in 2008-09 fiscal.

Mr Chaudhry, in an exclusive interview with CNBC-TV18, said that "The order book is looking very healthy. The railways had announced that they would be buying 20,000 wagons in 2008-009 fiscal, which is against about 12,000 to 13,000 in 2007-08, so there is a very healthy order book that is picking up or is likely to pick up from the railways and we expect to be able to carry the momentum."

Mr Chaudhry added that "Wagons continue to remain our main core business and it did contribute to 80% of our revenues, but going forward we believe that all the other divisions like the passenger coaches and special projects will also contribute towards the company’s growth ahead."

Chennai Port invites bids for box terminal project

Chennai Port Trust has invited bids to develop its latest mega box terminal project that is projected to handle 4 million TEUs a year and was announced in August 2007. The final day for submission of requests for qualification is June 16th 2008, after which it will invite requests for proposals.

Chennai Port also announced plans for one of the proposed breakwaters at the new mega box terminal to be utilized as a deep drafted oil berth for handling very large crude carriers.

The estimated the cost of the mega box terminal is expected at USD 750 to USD 760 million and will be developed on a build operate transfer basis under a 30 year concession. Construction work would start in the next 2 to 3 years. The winning developer will design, finance, construct and operate the new facility while the CPT will handle the supportive works.

Officials at Chennai Port said that the project is in line with its long held plans for Chennai to become the container hub of the Indian east coast. Plans for an along side depth of 18 meters would rank the new terminal as among the world's deepest, while the proposed capacity to handle 4 million TEUs per year would make it India's single largest box facility.

Mr AK Gadkari chief engineer at Chennai Port said that Chennai International Terminal, the JV between PSA and Sical will not be allowed to bid for the project.

Chennai's current box facility, DP World run Chennai Container Terminal Private Limited handled 885,000 TEUs during 2006-07 up by 20.5% YoY.

PM dedicates Dulhasti hydel plant in J&K to nation

Dr Manmohan Singh has dedicated the 390-MW Dulhasti hydel power project in Jammu and Kashmir to the nation.

Dr Singh said there is an urgent need for tapping hydro power potential in the Himalayan region and that the development of hydro power projects in the Chenab basin should be taken up at faster pace. He said “Our several projects are not getting completed in time, which result in escalation of cost. If we continue with this, we cannot continue the economic progress.””

Built on the River Chenab in the newly created Kishtwar district, the foundation stone for the National Hydroelectric Power Corporation’s project was laid 25 years ago. When the foundation stone for the project was laid on April 19th 1983, its cost was estimated at INR 183 crore, but was finally completed last year at an investment of INR 5,228 crore.

The main components of the Dulhasti power station are a 65 metre high and 186 meter long concrete gravity dam across the River Chenab, a 10.5 kilometer long Head Race Tunnel, an underground Power House with three generating units of 130 MW each, and a 7.46-m diameter and 307 meter long Tail Race Tunnel. The first unit of 130 MW was successfully synchronized on February 28th 2007, followed by the second unit on March 18th 2007 and the third on March 26th 2007.

Indian cement makers energy consumption seen falling

According to a report released by the CII Green Business Centre, the Indian cement industry’s average thermal energy consumption is likely to come down to 710 kilo calorie per kilogram of clinker in the next 2 years. The report states that in the next 2 years the average electricity consumption will fall to around 78 kWh for a tonne of cement. This is in comparison to the average electricity consumption of 82 kWh per tonne and thermal energy consumption of 725 kilo calorie per kilogram in 2005-06.

Mr G Jayaraman chairman of Cementech 2008 and also executive president of Birla Cement Corporation said that "The improvements in energy performance in the recent past have been possible largely due to retrofitting and adoption of energy efficient equipment, better operational control and optimization." He added that companies have also upgraded the process control and instrumentation facilities, which have helped them in energy performance.

Mr Jayaraman said that "If the current trend of energy consumption is maintained then in the next 5 to 6 years the electrical energy consumption is likely to be between 56 kWh to 62 kWh a tonne and the thermal energy consumption will be around 650 kilo calorie per kilogram of clinker." He added that during the current fiscal there is likely to be a capacity addition of around 40 million tonnes and most of the new plants which are coming up have adopted better energy practices.

According to estimates, the energy requirement of the cement industry is likely to go up by over 50% in the next 2 years and that is why companies are looking at adopting more efficient and eco friendly fuels. The total capacity of the industry is likely to touch 350 million tonnes by the end of the current 5 year Plan from 185 million tonnes at present.

Mr Jayaraman said that some of the cement plants in India were operating with specific energy consumption numbers, which are the best in world. He added that "The cost of energy has been the predominant driving factor for such advancement in energy efficiency. However, we cannot do a like to like comparison with factories in the Western countries as the operational time of the plants here is much more than in Western countries. Also, the plants there have superior quality of coal, power situation is better and also may of them use oil and gas. So the situations are totally different."

Revival package for restructuring HSL under consideration

Mr TR Baalu union minister of shipping, road transport & highways recently said that a revival package in the form of rehabilitation cum financial restructuring of Hindustan Shipyard Limited is under active consideration of the government.

The said revival package is intended to turn around the yard so that it could compete in the global market and cash in on the global boom in shipbuilding and ship repair sector.

The state government of Andhra Pradesh has also emphasized on the need for such package for HSL. A group of ministers constituted in this regard, has considered it and made certain recommendations. A final proposal containing the recommendations of the GoM shall be placed for the approval of the competent authority.

Krishnapatnam Port phase I set to start in June 2008

BL reported that the first phase of the INR 10,000 crore Krishnapatnam Port is all set to begin commercial operations in June 2008, in just 18 months after the work began for the conversion of the existing minor port into a major one.

With the maritime trade witnessing significant growth and Chennai Port getting congested, Krishnapatnam Port is targeting to become a hub for containers, coal and petrochemicals.

Mr CV Rao CMD of Navayuga group said that "The port is going to be the biggest container terminal in India. It has generated interest among the industry, shipping companies and power firms. There are firm plans for generation of 12,000 MW of power in the vicinity. This includes 1,800 MW unit proposed by the group."

He added that the 5,000 acre port, with a debt equity ratio of 75:25, would start off with an initial cargo capacity of 20 million tonnes and would go up to 90 million tonnes four years later.

Mr Rao said that the Andhra Pradesh government has awarded the 50 year port project to Krishnapatnam Port Company on a build operate share transfer concession. He added that "This is going to be a shorter and better destination for iron exports from the Bellary Hospet region. The transportation to and from the port to the railway lifeline would be ensured. A 600 kilometer long railway line would be laid, covering a stretch of 114 kilometer to connect Obulavaripalem, giving access to the Chennai Gooty route of the railway network. In the short term, a 26 kilometer stretch would be completed to connect Venkatachalam on the Chennai Howrah line to coincide the launch of the port in June 2008."

Mr A Chakraborty appointed as CEO and VC of GMB

Gujarat Maritime Board has appointed Mr Atanu Chakraborty as new CEO and VC replacing Mr HK Dash, who moves on to head the ports & transport department as the principal secretary.

Before assuming charge at GMB, Mr Chakraborty was serving as secretary of tourism Gujarat government. Mr Chakraborty has held positions like MD of Gujarat State Financial Services Limited, CEO of Gujarat Infrastructure Development Board and executive director of Gujarat State Fertilizers & Chemicals Company Limited. In the union government, he has served as joint secretary in the ministry of finance.

Mr Chakraborty comes to the helm of GMB at an important time, when the state government’s port authority is set to play an even more crucial role in Gujarat’s development through initiatives in shipbuilding, privatization, modernization, creation of maritime institutions and infrastructure.

India plans electricity to all villages by 2009 – Report

Mr Jairam Ramesh union minister of state for power said that centre is planning to provide electricity to all villages across India by 2009.

Mr Ramesh said that under the Rajiv Gandhi Grameen Vidyutikaran Yojana, 90% capital subsidy is provided by the power ministry for distribution and 100% grant is given for providing free connections to households below poverty line. RGGVY forms part of Bharat Nirman and aims at providing electricity to about 125,000 villages and electricity connection to 2.3 crore below poverty line households in the country by 2009.

He said that to provide electricity to all rural households, the government has accorded approval of INR 28,000 crore as capital subsidy for continuation of the scheme during 11th Plan period. Rural Electrification Corporation has been asked to compress the project execution to 15 months from 18 months. He added that for implementation of RGGVY, periodic review meetings are being conducted by the power ministry, REC and state governments, for taking all suitable actions to ensure timely completion of the projects.

Mr Ramesh further added that the monitoring committee has approved 316 projects for execution during the 11th Plan period. De centralized Distributed Generation and supply has been brought under the ambit of RGGVY with an initial allocation of INR 540 crore.

RPL and BHEL discussing turnkey contacts for Krishnapatnam UMPP

ET reported that Reliance Power is in talks with Bharat Heavy Electricals Limited to place the turnkey contract for its 4,000 MW ultra mega power project at Krishnapatnam and BHEL has time till May 31st 2008 to come up with a competitive offer to bag the deal.

The EPC contract would involve supply of main power equipment package and balance of plants for the project located in Andhra Pradesh. The configuration of the equipment could either be 5 units of 800 MW sets or 6 units of 660 MW sets. With a project cost of about INR 17,000 crore, the engineering, procurement and construction package would work out to about INR 8,000 to INR 10,000 crore.

Mr Jairam Ramesh union minister of state for power said that "Reliance has made an offer to BHEL for giving equipment orders for its Krishnapatnam power project. The order would give a big boost to BHEL’s plans for entering manufacturing of supercritical power equipment. I am hopeful that BHEL would respond positively to the offer."


For BHEL, the Krishnapatnam order would its first bid for a UMPP project. It is looking for orders from large projects, especially for equipment based on supercritical technology. It is also banking on bulk orders from NTPC for its foray into manufacturing 800 MW sets.

For Reliance Power, it would be its first brush with a PSU for an UMPP project. It is negotiating with five foreign equipment majors like Ansaldo from Italy, Doosan of Korea, Japan’s Toshiba, Power Machines from Russia and Shanghai Electric from China for contract of main power equipment for its Sasan UMPP.

Maruti Suzuki to hike prices from first week of May 2008

PTI reported that, reeling under intense pressure from rising input costs Maruti Suzuki has decided to hike prices from the first week of May 2008.

According to sources, Maruti's sales department has written to dealers to be prepared for the imminent price hike and exhaust existing stocks before the new prices come in. The letter read that "There has been a continuous increase in the steel and commodity prices in the past few months. As a result our input costs have increased substantially. We have been trying to absorb this increase in the input costs, but now we are forced to pass on a part of this increase to the customers. The amount of increase is likely to be substantial and will increase the ex-showroom price by the first week of May 2008."

Maruti Suzuki had last increased the prices of its cars in February 2008 ranging between INR 1,000 and INR 11,000 across most of its models. It, however, reduced prices in its 6 models following the excise duty reduction announced in the Budget on small cars from 16% to 12%.

Maruti 800, Omni, Zen, Wagon R, Swift Diesel and Alto that qualify for the lower excise benefit, saw the price reduction ranging between from INR 6,500 and INR 18,030.

TATA Motors trebling captive power generation at Pune

BL reported that, in a move that appears to be hedging against irregular power supply and load shedding in the Pune region in the future, auto major TATA Motors is in the process of more than trebling captive power generation capacity at its Pimpri plant. The new generators will be a stand by arrangement in case power supply fails.

Once an additional 3 generator sets, acquired from the Thane works of Mafatlal group company Standard Alkali are installed and commissioned around June 2008, TATA Motors will have the capacity to generate 44 MW of power against the existing 14 MW.

A spokesperson for TATA Motors said that "TATA Motors is currently installing three diesel generator sets of 10 MW each, at our plant in Pimpri. Post installation, the total power generation capacity here will be about 44 MW. The existing generators at Pimpri have a capacity of about 14 MW."

TATA Motors’ average daily power consumption is pegged at 50 MW to 55 MW.

Indian new & renewable energy sources touch 11449 MW

Mr Vilas Muttemwarinister union minister of state for new & renewable energy said that a grid interactive power generation installed capacity of 11449 MW has been set up in India till and of March 2008.

This is based on various renewable energy sources. This comprises of 7939 MW wind power, 2062 MW small hydropower, 1446 MW bio power and 2 MW solar power.

Besides this large number off grid decentralized renewable energy systems or devices are making a significant contribution to conservation of conventional energy. A capacity addition of 15000 MW from renewable energy sources has been proposed during the 11th Plan period.

IIT Madras invited to take part in Chennai Metro project

Dr E Sreedharan MD of Delhi Metro Rail Corporation said that IIT Madras should look at collaborating with the government on the Chennai Metro Rail project.

Recalling his experience with educational institutes like IIT Delhi, which did not wish to work on the Delhi Metro Rail project on mutually acceptable terms, Dr Sreedharan said institutes should not miss out on such a learning opportunity.

He added that "The Metro is not a simple project. We need civil engineers, instrumentation engineers, those who know geophysics and ground water table management, air conditioning technology experts to design the ventilation of tunnels. It is a learning opportunity that may not come again."

He encouraged students to pursue a career in their field of undergraduate studies and not switch lines or decide to leave the country for good. He added that "The nation has invested so much of resources in your training as engineers. Do not throw it to the winds. Have pride in serving your profession."

Krishnapatnam port receives first vessel

Krishnapatnam Port Trust, which is expected to become a main gateway for the hinterlands of south and central India, recently announced that it has received the first vessel on its berth, a 160 meter long vessel MV Faruke.

The vessel is carrying two Gottwald mobile harbor cranes and is berthed using dedicated tugs, with in house expertise.

Marg Construction secures Cheyur Port contract in TN

BS reported that infrastructure development company Marg Constructions has been selected by Tamil Nadu government to develop a minor port at Cheyur in Tamil Nadu.

Under the contract, Marg Constructions would invest around INR 1,000 crore and would likely fund the project through a special purpose vehicle. The port will commence operations in 48 months.

A senior official close to the development said that the new port is likely to supply coal for the Tamil Nadu Electricity Board’s 4,000 MW power plant coming up near Cheyur at a cost of INR 16,000 crore.

This will be the second port project awarded to Marg Constructions in the southern region. In 2006, the Puducherry government had selected Marg Constructions to build a port at Karaikal. The port is likely to start commercial operations in the first quarter of 2009.

An SPV called Karaikal Port Private Limited has been created by Marg Constructions to set up the project. The SPV has invested INR 416 crore in Phase I of the project, of which INR 302 crore has been raised in debt funding. At the end of Phase I, the port will be capable of handling 4 million tonnes of cargo annually.

AV Birla to set up INR 600 crore carbon black unit in Mexico

PTI reported that the Aditya Birla group is close to signing a land deal with the port authority of Altamira in eastern Mexico to set up a carbon black plant with an investment of USD 150 million.

Mr Surendra Goyal AV Birla Group’s joint president in Latin America said that "We may sign the agreement next week. The USD 150 million project will be completed in 2 years." He added that an area near the port in the Mexican state of Tamaulipas is picked as an entry point to the US, where naphtha is cheaper.

The Aditya Birla group has a capacity to produce 750,000 tonnes of carbon black per annum, which makes it the world’s 4th largest manufacturer of the material. It has carbon black units at Alexandria in Egypt, a unit in Thailand and in China. In India, it has two plant in Uttar Pradesh and Tamil Nadu with a combined capacity of 230,000 tonnes annually.

The Aditya Birla group has planned an investment of about USD 600 million to ramp up its carbon black manufacturing capacities in India and abroad, aiming to increase its market share in the competitive industry. It is also planning to set up a plant in Oman.

M&M set to buy Belgian gear maker VCST for EUR 300 million

ET reported that auto major Mahindra & Mahindra is in an advanced stage of negotiation to acquire Belgium gear maker VCST for EUR 300 million.

VCST, which designs and manufactures gears, gear sets and shafts for automotive engines and brakes already, has a presence in India. It formed a 50:50 JV with Amtek Auto. It employs around 1,000 people and operates 5 manufacturing facilities in 3 locations of Sint Truiden in Belgium, Reichenbach in Germany and Detroit in Michigan.

If the sale goes through, this would be the fourth time in seven years that VCST has been sold. It was earlier sold by San Francisco based private equity firm Fox Paine to Alpha Fund and the management for EUR 250 million at the end of 2005.

Analysis of steel industry in Thailand

SEAISI in report released in March 2008, has outlined that steel industry scenario in Thailand as under

After recording an all time high in apparent steel consumption of 14.1 million tonnes in 2005, Thailand’s steel industry has been on a downward trend largely due to political uncertainties as well as the problem in the southern part of Thailand. Steel consumption in the country dropped by 5% to 13.4 million tonnes in 2006. This negative trend has continued into 2007, resulting in a further contraction of apparent steel consumption at 6% YoY to 12.6 million tonnes.

Thailand is a scrap based steel producing country with total annual capacity of 6.5 million tonnes of semi finished steel. The consumption of semi finished steel was highest in 2005 at 10.8 million tonnes. Latest figure for 2007 showed a decline to 8.8 million tonnes. However, domestic supply has been increasing and reached a high of 5.6 million tonnes in 2007. On the other hand, Thailand’s import of semi finished steel declined sharply from 5.7 million tonnes in 2005 to 3.9 million tonnes in 2006. Import continued to drop to 3.4 million tonnes in 2007. It is expected that Thailand will continue to enhance its self-sufficiency in domestic supply for semi-finished product in the coming years to serve its growing demand and to substitute import, the supply of which is tightening. Hopefully, the new steel-making projects could help to fulfill domestic requirements in terms of both quality and quantity.

Long product consumption (bar, wire rod and section) continued to decline significantly in the last two years. Total consumption in 2007 was 4.7 million tonnes, a decrease of 10% from 2006. The political uncertainties in the country caused a delay in the implementation of several major construction projects. This has resulted in a sharp drop in bar production, which is mainly to serve the construction sector. The Iron and Steel Institute of Thailand estimated that domestic output of bar declined by 7% in 2007, following a sharp drop of 14% in 2006.

Hot rolled sheet consumption in 2007 was more upbeat with a moderate increase of 3.5%, from a sharp drop of 12% in 2006. However, this was mainly met by the huge increase in import which registered a 22.5% growth rate to reach 2.9 million tonnes. The bulk of the import comprised of hot rolled carbon sheet and hot rolled pickled and oiled sheet, which were mainly high quality products to serve the automotive sector. Domestic output, however, dropped by 4.4% to 3.9 million tonnes. Export maintained an upward trend at 8% to 1.04 million tonnes.

Cold rolled consumption in 2007 declined 5% YoY to 2.2 million tonnes. Domestic production surged by 11% to 1.98 million tonnes, while import dipped 15% to 0.7 million tonnes. Production of hot dipped galvanized sheet declined 11%, while export remained almost at the same level as 2006. This was a reflection of the slowdown of construction sector in the country. On the other hand, import of hot dipped galvanized sheet from Japan and South Korea rose sharply at the rate of 8% and 40%, respectively. The imports were mainly high quality galvanized sheet, such as galvanneal or zero sprangle sheet to serve automotive and electrical appliances sectors.

Consumption of metal coated sheet such as Zinc alume and color coated sheet, mainly for the construction sector, declined slightly to total 354,000 tonnes in 2007. Domestic production registered a significant increase but it was mainly to serve export market.

Tinplate production in 2007 dropped substantially at the rate of 21% to 233,000 tonnes. However, import rose by 32% to 132,000 tonnes. Local producers claimed that the demand remained high but domestic producers were affected by low-priced imports. The recent capacity expansion of Thai Tin Plate would help to boost domestic production and replace some of the imports.

Thailand’s GDP growth rate for 2007 is estimated at 4.6% and the economy is projected to expand further to almost 6% in 2008. The new government of Thailand has launched various mega projects and is pushing for more economic activities for the first half of the year. This would lead to more construction projects, including condominiums and new housing areas. Hence, we can expect to see increased steel consumption from the second half of 2008.

For the automotive sector, domestic production growth rate has moderated over the last two years, compared to the sharp growth in the preceding years. Nevertheless, total production in 2007still grew at a healthy 9% to reach 1.3 million vehicles. About 75% of which was the production of pick up truck, which expanded at the rate of 8.5% in the same period. It is expected that the more stable political environment as well as the government’s policy to continue to promote the industry will boost consumer confidence and spending in 2008.

Taking into consideration the above positive developments, Thailand’s steel consumption is expected to regain its growth path in the coming years. Major steel consuming sectors have started to pick up and are expected to continue to grow further. The construction sector, in particular is expected to propel the consumption growth for steel. The Iron and Steel Institute of Thailand has projected a 5% growth rate in steel consumption for 2008 and 8% to 10% for 2009.

(Sourced from seaisi.org)

Scrap prices establish new baseline - Canaccord

According to Mr Eric Glover analyst of Canaccord Adams, soaring scrap prices may never return to previous levels.

Mr Glover said that recently buoyant markets may have established a new floor for scrap pricing, which may be as high as USD 250 per short ton, as compared with an average floor of between USD 80 per short ton and USD 125 per short ton for much of the 1990s. In 2004, Mr Glover said the floor spiked to USD 200, but even that level is now obsolete.

Mr Glover said that "Scrap is an increasingly valuable global commodity and the pricing floor continues to go up. We keep establishing new, higher pricing floors. Even USD 300 may not be too high as a new floor. Think of it like gas prices. You would not see USD 2 gas anymore."

He said that robust offshore demand and tightening US supplies have driven ferrous scrap prices to record heights, with the Platts prices assessment for shredded scrap, delivered Midwest, rising USD 160 to a midpoint of USD 555 most recently.

Mr Glover said that US exports of ferrous scrap have more than tripled from 5.2 million tonnes in 2000 to 16.4 million tonnes in 2007. People are paying higher prices to pry scrap away from others.” He added that further, growth in electric arc furnace capacity will drive additional scrap demand.

Ship orders volumes have to slow down in 2008 - Lloyd Register

According to Lloyd's Register Group, global ship orders may plunge more than half this year after optimism about world trade and China's need for raw materials caused demand to surge in 2007. Mr John Stansfeld president of Lloyd's Asia in an interview in Shanghai said that "It simply can't carry on at the unprecedented rates of last year. It has to slow down.”

According to Clarkson Plc, Orders for vessels to carry fuel, iron ore and consumer goods have all cooled this year amid concerns about a global slowdown and the subprime mortgage crisis. Hyundai Heavy Industries Co, the world's biggest shipbuilder, and other yards won a record 246.3 million deadweight tons of orders last year, 43 % more than in 2006.

Mr Lee Jae Won a Tong Yang Investment Bank analyst in Seoul said that “Uncertainty in the global market is making shipping lines hesitant about ordering more vessels. Still, shipyards have a backlog of almost four years and ship prices remain at record levels, so it's still a shipbuilders' market at the moment.''

According to London based Clarkson, the price of a ship able to carry 6,200 20 foot containers reached USD 107 million at the end of March from USD 106.5 million at the end of last year. The price of a 300,000 DWT oil tanker rose to USD 152 million last month from USD 146 million last year.

Mr Stansfeld said that South Korea, the world's largest shipbuilding nation, also faces rising competition from China, which is aiming to make more complex and profitable vessels. China surpassed Japan as the world's second biggest shipbuilder in 2006 and may rank first by 2015.

He added that “For China to get to the top of the industry, it needs to diversify its vessel types. It will take a great deal of effort to get to the same level'' of sophistication as Japan and South Korea.

Chun Yuan announces investments on steel mill in Vietnam

CENS reported that Chun Yuan Steel Co one of Taiwan’s leading manufacturers of steel plates, has resolved to invest USD 11.48 million to tap the Vietnamese market by joining a massive investment project jointly launched by China Steel Corporation and Sumitomo Metal Industries of Japan at the end of last year.

Chun Yuan in a statement said the investment in Vietnam is designed to help the firm secure stable supply of upstream raw materials and tap the ASEAN market in the years to come.

At the end of last year, CSC resolved to cooperate with Sumitomo to set up a joint venture steel mill for turning out cold rolled and hot dip galvanized steel coils. With a total investment of USD 1.15 billion, the proposed steel mill is designed to have an annual production capacity of 1.7 million tonnes of steel products. Where CSC will hold a 25% stake in the new joint venture with the remainder going to Sumitomo and other partners. The plant is expected to launch mass production in 2011.

Chun Yuan said that it currently purchase raw materials from CSC and has become one of CSC’s top five customers. To maintain close cooperation relationship with CSC, Chun Yuan has decided to take part in the joint venture in Vietnam. In addition, participating in the investment project will help Chun Yuan smooth the way into the ASEAN marketplace in the years to come.

Quanex shareholders OK purchase by Gerdau SA

AP reported that steel products maker Quanex Corp shareholders approved the USD 1.67 billion purchase of the US company by Brazil's Gerdau SA. With about 90% of the shares represented, over 99% were voted for the deal, set to close.

As part of the transaction, Quanex Building Products Corp, which makes engineered building components, has been spun off from the parent and will replace Quanex Corp in the S&P SmallCap 600 after the close of trading Wednesday.

Gerdau, whose American Depositary Shares trade on the New York Stock Exchange, is one of the largest steel producers in the Western Hemisphere.

RMDAS Ferrous Scrap Pricing index for US hit through the roof

Recycling Today reported that if mill buyers thought they were dealing with high prices in the first quarter of 2008, the second quarter started out by making those prices seem like the good old days of sub USD 500 scrap as buyers on the April spot market ran into per ton price increases of from USD 150 to USD 170 per ton, depending on the grade and region.

Regional aggregated spot market prices compiled by Management Science Associates of Pittsburgh, through its Raw Material Data Aggregation Service, show mills paid in a range of from USD 576 to USD 599 per ton for the new production scrap used to define the RMDAS Prompt Industrial Composite grade. While #1 Heavy Melting Steel and Shredded Scrap traded in a lower range, pricing for those grades also moved up by USD 150 to USD 160 per ton in April compared to March.

The report said that regionally, buyers in the North Midwest region faced the highest prices, with mills paying an average of USD 599 per ton for prompt industrial grades and USD 514 per ton for #1 HMS. Buyers in other regions may have paid a few dollars per ton less, but nonetheless faced record pricing that moved in a huge leap beyond what was being paid 30 days previously.

Corus may extend long term slab supply deal

Evening Gazette recently reported that TATA Corus Teesside Cast Products is planning to extend long term slab supply deal.

The report cited Mr Jon Bolton MD of Teesside Cast Products as saying that discussions would be getting under way soon on extending the 10 year agreement to supply a consortium of overseas companies, which breathed new life into the plant in 2004.

Mr Bolton said that “We are hoping progress will be made this year to renegotiate the consortium deal. It is going well and I do not see any reason why it would not be extended. The market is also currently very strong.”

Mr Bolton said that so far, the deal has leveraged GBP 40 million of investment from consortium members to create a dedicated rail link to Teesport. But an GBP 80 million upgrade to the blast furnace due in 2014 has triggered another round of talks, which will effectively commit the consortium to working with Corus well beyond the current agreement. He said that “The investment would also give the blast furnace a further lifespan of 10 years to15 years. The consortium brings with it investment. We are getting to the point where we need to make some decisions.”

Mr Bolton said the long term strategy was to exploit the market for high grade steel before emerging economies caught up. Since the supply agreement, we have introduced 300 new grades and 60 new products. If you can find a route to market for specialist slab, then Teesside has a future.

Duferco, Marcegaglia, Dongkuk and Imsa buys the bulk of steel produced on Teesside. With 75% of output now going abroad, the agreement helped push Teesside Cast Products to world number one in the export rankings for slab in 2007.

Monthly steel fact sheet for US import in March 2008

The preliminary data released by US show that overall steel imports in March 2008 increased by 1.2% MoM from February 2008.

The marginal change in March’s total amount of steel imports was due to an decrease in some goods, such as blooms billets and slabs by 19% and hot rolled sheet by 24% and an increase in other goods such as oil country goods by 48% and plates in coils by 32%.

There was a notable 69% increase in standard pipe. Similarly, stainless imports increased 1.11% resulting from mixed increases and decreases in individual stainless products. February 2008 imports of steel mill products were down by 17.4% compared to February 2007.

Preliminary Census Steel Import Statistic Comparisons

In tons
(Sourced from SIMA)

Metalico Q1 sales up by 230% YoY

Metalico Inc reported its best quarter ever, with sharp increases in revenues, operating income and net income for the first quarter of 2008.

Its net income for the quarter ended March 31st 2008 was USD 6.1 million on sales of USD 170.5 million compared to net income of USD 3.1 million on sales of USD 51.8 million for the quarter ended March 31, 2007, an increase in sales of USD 118.7 million or 230% over the same quarter 2007 results. Operating income for 2008 increased USD 7.9 million or 153% YoY to USD 13.1 million as compared to USD 5.2 million for the prior year quarter.

First Quarter Highlights

1. First quarter sales increased by 230% to USD 170.5 million in 2008 compared to USD 51.8 million in the prior year's first quarter.

2. Operating income for the quarter was USD 13.1 million, compared to operating income of USD 5.2 million for the quarter ended March 31st 2007, an increase of 153%.

3. Income from continuing operations increased 104% for the quarter to USD 6.5 million from USD 3.2 million in the prior year.

4. EBITDA rose to USD 15.8 million, an increase for the quarter ended March 31st 2008 of 57% over USD 10.0 million in the fourth quarter of 2007.

Metalico's Scrap Metal segment experienced QoQ volume increases of approximately 82% for ferrous and 95% for non ferrous metals. The Lead Fabrication segment volume remained unchanged QoQ>. Ferrous metal prices saw an increase of 50% QoQ, while selling prices for non-ferrous rose by 166% QoQ.

Mr Carlos E Agüero president & CEO of Metalico said that "We are extremely pleased with our performance. As a result of last year's acquisitions and the recent purchase of American CatCon in January, Metalico started 2008 with a much larger operating platform. In addition, we benefited from rising commodity prices throughout the quarter coupled with unit volume growth."

Raw material for 1 tonne of steel through BF

Source
1. Department of Primary Industries and Mines
2. Ministry of Industry
3. SMS DEMAG

Aichi Steel announces new chairman and president

Aichi Steel Corporation announced the appointment of Mr Akiyoshi Morita as Chairman of the Board and Representative Director, as well as Mr Syokichi Yasukawa as President and Representative Director effective June 20th 2008.

APM Terminals JV to develop new Vancouver box terminal

It is reported that the Vancouver Fraser Port Authority has named a joint venture of APM Terminals BV as the preferred bidder for its Terminal 2 project. Reports said that other bidders included Hutchison Port Holdings (HPH) and DP World.

The JV between APM Terminals North America and SNC Lavalin will now enter discussions with Vancouver Fraser Port Authority to confirm terms for an official agreement. APM Terminals expects negotiations to take four to six months.

The Terminal 2 project aims to expand container handling capacity at Roberts Bank via a new three berth facility with a reported capacity to handle 2 million TEUs per year. No schedule for the project has yet been confirmed.

Upon the signing of an official agreement, APM Terminals/SNC Lavalin is slated to proceed with site planning, investigation and environmental assessment, before submitting an environmental approval application to the appropriate government agencies.

According to APM Terminals, the development of Terminal 2 is part of a broader Vancouver Fraser Port Authority initiative to expand container terminal facilities at the port in response to the growth in containerized trade with expanding Pacific Rim nations.

The Vancouver Fraser Port Authority was formed at the start of this year as a merger between the three Lower Mainland port authorities Fraser River Port Authority, North Fraser Port Authority and the Vancouver Port Authority.

IHC Merwede acquires Sea Steel Ltd

IHC Merwede announced that it acquired 100% shares of Sea Steel Ltd and its subsidiaries on April 4th 2008. The company is based in Dorset in UK and has an extensive track record of developing innovative sub sea piling solutions for the oil and gas industries. The company will operate under the name IHC Sea Steel.

Sea Steel is responsible for a number of everyday innovative piling tools including the patented Fast Frame that has been developed to substantially reduce offshore installation times whilst maintaining pile orientation and verticality tolerances. The current rental fleet can be used for driving piles from 20” to 96” in diameter in water depths up to 2,000 meter.

Mr Govert Hamers president IHC Merwede said that “I am delighted that SEA STEEL is now part of the IHC Merwede Group. Sea Steel has been working together with equipment and hammer suppliers worldwide and will do so in the future. Sea Steel, in conjunction with IHC Hydrohammer and IHC Handling Systems can offer a complete pile driving package allowing clients the best possible options for expedient, accurate and successful offshore operations worldwide.”

IHC Merwede is world market leader in the construction of specialist dredging equipment and complex custom built offshore vessels. The clients of IHC Merwede include major dredging companies, oil and gas exploration groups, offshore contractors and government authorities. It has a staff of approximately 2,200 at its locations in the Netherlands. There are also branches in China, Houston, India, the Middle East, Russia, Singapore and the United Kingdom.

US wire rod market strengthens

As spot prices have been accepted at the higher level, US wire rod prices have soared by another USD 33 per ton.

The price rise is mainly supported by higher scrap prices and limited supply. Prices of low carbon wire rod from US mill is prevailing between USD 1,069 to USD 1,113 per ton and the high carbon wire price is offering at USD 1,124 to USD 1,168 per ton

US buyers have no choice but to purchase from Turkey. Current prices of wire rod for mesh have soared to USD 1,124 to USD 1,146 per ton.

(Sourced from YIEH.com)

Construction of Transnet Durban to J’burg pipeline to start in September

Engineering News reported that state freight logistics group Transnet would begin construction of the urgently needed ZAR 11.2 billion new multi product fuel pipeline from Durban to southern Johannesburg in August and was confident of completing the project by September 2010.

The plans envisage a new 535 kilometer 24 inch pipeline as well as a 170 kilometer 16 inch lines, four pump stations, a coastal and inland terminal and a new operating systems.

Ms Maria Ramos CEO of Transnet, while speaking at a media briefing at the Carlton Centre, reported that the front end engineering design for the pipeline had been completed and the orders had been placed for both the 16 inch and the 24 inch pipelines. She said that the environmental approval for the inland portion of the network was expected imminently, which would open the way for the construction of the 16 inch lines as from August. She added that the construction contract was scheduled to be placed in May.

Mr Ramos stressed that Transnet Pipelines had been working with the liquid fuel industry, as well as the Department of Minerals and Energy, on a range of mitigating strategies for the interim period while the pipelines were being built.

Given the September 2010 commissioning plan, the new infrastructure would also not be completed in time for the start of the FIFA World Cup, which kicks off in June and when inland fuel demand was expected to experience something of a peak.

ArcelorMittal plans surcharge for US steel customers

Citing high raw materials costs, the world's largest steel producer, ArcelorMittal, sent a letter to US auto makers and other US contract customers saying that it would apply a rare USD 250 a tonne surcharge to the price negotiated in existing contracts, according to people who received the letter.

Contract customers, including Ford Motor Co and General Motors Corp may have no immediate option but to pay up because of the tight steel market world wide. Moreover, other steelmakers are likely to increase prices or add surcharges for the same reason.

Japanese steel makers downbeat in 2008

Reuters reported that Japan's top two steel makers, Nippon Steel Corp and JFE Holdings Inc will likely forecast double digit percentage falls in profit for the business year that began this month due to soaring costs.

A Nippon Steel spokesman earlier this month said that costs for the entire Japanese steel industry could now balloon by more than JPY 3 trillion in 2008. Many analysts said although Japanese steel makers are likely to lift their forecasts over the course of the year as their price talks with carmakers and other clients progress, they probably won't hike prices fast enough to cover such cost rises,.

Mr Takashi Aoki senior fund manager at Mizuho Asset Management said that "The cost increases are such that it would take them two years to fully pass the costs on to end users. We expect profits to start rising again in the following business year, when costs will come down and prices will remain strong."

But China's No 1 steel maker, Baoshan Iron & Steel Co Ltd stung by a plunge in stainless steel sales last year, could see a 37% jump in profit for calendar 2008 helped by stable prices of nickel, a key ingredient in stainless steel.

Qatar Steel warns against hoarding of steel

Qatar Steel, which has announced its decision to freeze second quarter prices recently, warned traders and end users against hoarding.

Mr Nasser bin Hamad al Thani director & GM of Qatar Steel cautioned traders and end users not to overstock in view of the price freeze.

Asked whether the company, would initiate any action against those found hoarding, he said that "We may supply directly to market as we had done previously in one or two special cases. The project developers or end users would have to inform them regarding the size of the project and their requirements as well as the dealers through which they had been sourcing steel.”

Qatar Steel has fixed the retail price for standard sizes of 16mm to 40mm at QAR 3,250 to QAR 3,300 per tonne, which is lower by more than QAR 1,000 than prices prevailing in other GCC countries.

Qatar Steel has estimated production of 2.3 million tonnes of sponge iron, 1.63 million tonnes of molten steel, 1.6 million tonnes of billet, 1.75 million tonnes of bar and 300,000 tonnes of wire rod coils this year. Qatar Steel is also constructing a new plant with a production capacity of 1.2 million tonnes of molten steel per annum at an estimated cost of USD 700 million. The project also envisages production of some 800,000 tonnes of rebars.

Steel sector seen as a major job provider in Saudi Arab

Dr Mahmoud Mohieldin Saudi Arabia’s minister of investment, while addressing at Arab Union for Iron & Steel Conference, said that the steal industry is vital to investment and gives direct and indirect returns to the economy and community. He added that Arab and international steel markets record a remarkable increase in demand on steel products, driven by unprecedented growth rates in the region and development of infrastructure and steel based industries.

Dr Mohieldin noted that Arab markets provide great investment, expansion and growth opportunities for these industries. He cited studies concluding that each job in the iron and steel industry creates nine jobs in other related industries. He added that each investment unit in the iron industry opens doubled investments of ten times in feeding and consuming industries.

He highlighted the importance of integration in this leading industry to ensure a steady economic growth and creation of new jobs in Arab countries. He said that the iron industry still has a limited contribution in Arab GDP although Arab countries possess numerous and qualifiable laborers in addition to capitals that search promising opportunities of investment and growth.

Dr Mohieldin urged the private sector to increase its investments in people and spend more in research and development to increase production, reduce cost and support competition.

Dredging work begins for Khalifa Port

Abu Dhabi Ports Company recently announced that dredging and reclamation work has commenced for Khalifa Port, a multi purpose maritime facility located approximately 4.6 kilometers off the shores of Taweelah.

The project is part of Abu Dhabi Ports Company's multi billion dollar Khalifa Port and Industrial Zone, which will provide the necessary logistics infrastructure for Abu Dhabi's growing industrial and commercial sections, as outlined in the government's Plan Abu Dhabi 2030.
Mr Ahmed Saeed Al Calily CEO of Abu Dhabi Ports Company said that "Khalifa Port is designed to increase Abu Dhabi's port capacity far above the current marine traffic served by the existing port of Mina Zayed. It will create a gateway for the import of all cargo into Abu Dhabi and export of goods manufactured in the adjacent industrial zone."

He added that "This will be a state of the art facility and one of the most important industrial developments in the region."

UAE and US sign pact on nuclear energy

UAE news agency WAM reported that Mr Sheikh Abdulla bin Zayed Al Nahyan foreign minister of UAE and Ms Condoleezza Rice US secretary of state have signed a MoU on cooperation in peaceful uses of nuclear energy. The signing follows the public launch of the detailed policy document by the UAE on the evaluation and potential development of peaceful nuclear energy within the UAE as the best viable alternative to meet the power demand.

Commenting on the signing of the bilateral agreement, Sheikh Abdullah said that "The UAE US MoU represents an excellent example of cooperation the UAE hopes to forge with responsible nuclear supplier states in the area of peaceful nuclear energy. There are potential mutual benefits to both parties from deepening cooperation in the development of the UAE's domestic nuclear energy sector."

He further welcomed the prospect of negotiating a more extensive bilateral agreement for peaceful nuclear cooperation known as Section 123 Agreement in the United States, which would establish the necessary legal basis for trade in significant nuclear commodities between the two countries. It also contains a number of commitments and strategies designed to ensure that these principles would be upheld by any UAE domestic nuclear program, including a pledge to forego any domestic enrichment or reprocessing capability in favor of long term external fuel supply arrangements.

The UAE policy in this respect is based upon the principles of complete operational transparency and the highest standards of safety, security and non proliferation. The first phase of the program will be carried out with foreign assistance, and offer JV arrangements to foreign investors for construction and operation of future nuclear power plants.

Mr Hamad al Kaabi representative of the UAE ministry of foreign affairs for international nuclear cooperation said that "Nuclear power is proving an option that that UAE can not ignore because it's cost competitive." He added that by 2020, natural gas will be insufficient to meet the country's energy requirements.

It may be recalled that in March 2008, UAE announced plans to establish Nuclear Energy Program Implementation Organization, a AED 375 million initiative to evaluate and potentially realize the transparent nuclear energy program within the UAE. It was preceded by an agreement with France to help UAE develop the nuclear capability in January 2008.

Eships inks shipbuilding contract with STX Corporation

Emirates Ship Investment Company has signed a shipbuilding contract with Korea's STX Corporation for the construction of 2 semi refrigerated LPG tankers. The contract for these additional tankers was finalized during a recent signing ceremony, which was attended by Mr Ahmed Saeed Al Calily chairman of Eships and Mr DK Bae deputy president of STX Corporation.

The vessels, which are valued at approximately USD 38 million each, are scheduled for delivery in May and July 2010. They will be committed on long term period charters to Total.

Mr Scott Jones CEO of Eships said that "These 6500 cubic meter tankers are designed to meet the highest quality, with state of the art safety and environmental features. This is consistent with Total's stringent requirements and Eships' vision of providing industrial customers with safe, reliable and environmentally friendly marine transportation."

Eships, which is owned by Oman and Emirates Investment Holding Company, Mubadala Development Company and Abu Dhabi Investment Company already, has 4 vessels on time charter to Total.

Turkey to spend USD 826 million on exploration

Turkish Daily reported that Türkiye Petrolleri Anonim Ortaklığı will spend USD 826 million on gas and oil exploration in 2008 to meet rising demand.

Mr Hüseyin Yakar manager at Türkiye Petrolleri did not give a figure for last year's investment in exploration but according to the energy ministry, it was USD 350 million in 2006 and USD 70 million in 2002.

Turkey imports nearly all of its oil and gas and higher global energy prices have helped swell the current account deficit to USD 3.7 billion in February 2008. Energy demand is rising in Turkey amid 6 consecutive years of economic growth.

Mr Yakar said that Turkey has mainly explored off its Black Sea coast, where it hopes to find a giant field. Turkey began producing gas last year near the Black Sea town of Akçakoca, a site that's yielding 500,000 cubic meters a

He further added that Türkiye Petrolleri is now shifting priority to the Mediterranean and last year completed the collection of seismic data at two sets of blocks near the cities of Antalya and Mersin.

India expects FTA with Gulf within one year

Mr Kamal Nath commerce minister of India said that he expects substantial progress in reaching a free trade deal with the Gulf Cooperation Council within 1 year. He added that a deal has been delayed because negotiators have been busy with trade talks at the World Trade Organization.

Mr Nath, while addressing at the Dubai International Financial Centre, said that "We will be pushing this forward. We should make substantial progress in the next one year. There has been a slowdown in the negotiations not because of any content issues but because of resource issue. India is negotiating with the EU, Japan, South Korea and then they are doing the intensive WTO talks that have taken up the time of our negotiating teams."

Zarubezhneft eyeing investment in Iranian oil and gas sector

Tehran Times reported that Russia’s oil & gas major Zarubezhneft is interested in making investment in Iran’s oil and gas industry.

Mr Stanislav A Mikhailov deputy director for projects development and implementation at Zarubezhneft said that it is active in Iran in the 90s for digging a 6000 meter exploration well in the Caspian Sea and carrying out geological surveys in the region.

Zarubezhneft is a state run oil company which was established in 1967 to implement oil projects outside Russia. It is the leading foreign economic enterprise in the oil and gas industry of Russia. It enjoys a long and rich work history and is active in the development and implementation of complex oil and gas programs and projects abroad, covering all stages from exploration to facilitation of oil fields on land and offshore

Dolphin Energy starts supplying gas to Sharjah

Qatar’s Dolphin Energy Limited has announced that it is supplying Sharjah with gas for the first time through the Qatar UAE transit pipeline. The gas is being delivered to the Sharjah Electricity & Water Authority via Dolphin’s new pipeline connection to Dubai on an interruptible basis begun on April 18th 2008.

Through existing supply arrangements to the Federal Electricity & Water Authority and Sharjah Electricity & Water Authority, Dolphin now supplies all UAE Emirates with its natural gas. It already supplies gas directly to Abu Dhabi, Dubai, Fujairah and Ras Al Khaimah.

Mr Ahmed Ali Al Sayegh CEO of Dolphin Energy said that "Dolphin is happy that it can supply gas to Sharjah to meet the Emirate’s growing energy needs. Dolphin gas is currently helping all of the UAE’s emirates to meet power demand, and we shall assist wherever we can in future."

In February 2008, Dolphin has achieved full capacity that reached a daily maximum of 2 billion standard cubic feet of gas a day.

India and Pakistan agree to buy gas from Turkmenistan

PTI reported that India and Pakistan have committed themselves to buying natural gas from Turkmenistan despite cost of laying pipeline from Turkmenistan doubling to USD 6 billion. India, Pakistan and Afghanistan signed the framework agreement with Turkmenistan for laying the line by 2015.

Two days of deliberation of the steering committee of the Turkmenistan Afghanistan Pakistan India pipeline, that has the US backing, saw the formal induction of New Delhi and resolved issues regarding gas reserves in Turkmenistan and demand of the South Asian neighbors.

After the meeting, Mr Khwaja Asif Pakistan's petroleum minister said that "We are strongly committed to the project. We believe it is still economically viable for the four countries even after the escalation in cost."

According to a draft feasibility study prepared with the support of the Asian Development Bank, which is financially backing the pipeline, the estimated cost of the project has increased from USD 3.3 billion in 2004 to USD 7.6 billion. The escalation was due to sharp rise in steel prices, jump in construction costs and cost of compressor stations to be set up for the 1,680 kilometer line from Turkmenistan's Daulatabad gas field to Fazilka on the India Pakistan border after passing through Herat and Kandahar in Afghanistan and Multan in Pakistan.

Al Qahtani acquires Dalma Energy

It is reported that the ownership of drilling rig company Dalma Energy LLC and its subsidiary has been transferred to Al Qahtani Investments LLC.

Dalma operates 22 land drilling rigs in Oman, Saudi Arabia, Qatar, India and Algeria. Its fleet comprises of 7 light rigs, 4 medium rigs of 1,500 hp, and 11 heavy rigs of 2,000 hp. It offers a variety of services from shallow depth drilling and work over operations to drilling oil wells and deep gas wells.

Mr Sheikh Tariq Al Qahtani chairman of the board of Al Qahtani Investments LLC said that "We see this acquisition as a strategic long term investment for Al Qahtani Group, being in line with our interests in both domestic and international markets. It is our intention to develop Dalma Energy into one of the leading drilling and services companies in the region."

Meanwhile, Mr Abdulla Nasser director of Al Qahtani Investments LLC said that "Al Nasser Group is keen to diversify its portfolio in the oil field services. The acquisition of Dalma will help to expand our oil field services still further."

Shougang to move out of Beijing by 2010

It is reported that Beijing Shougang Group, China's fourth largest steel maker will move all its plants to neighboring province by 2010. After one year's construction the new base began to enter producing preparation work stage.

The new base covering about 20 square kilometers will be located in Caofeidian, an island 80 kilometer south of Tangshan in Hebei Province. The first phase will be put into operation in October this year.

According to a Shougang plan submitted to the State Council, the group will build a new base in neighboring Hebei Province, with an expected annual production capacity of 9 million tonnes.

Yunnan Luoping Zinc cuts two thirds capacity on power shortages

It is reported that Yunnan Luoping Zinc & Electricity Co a Chinese producer of the metal has cut two thirds of its capacity because of a lack of power.

Yunnan Luoping Zinc & Electricity Co said in a statement to the Shenzhen Stock Exchange April 24th 2008 that production has dropped to 50 tonnes of zinc a day. Rivals Yunnan Chihong Zinc & Germanium Co. and Yunnan Aluminum Co. said they shut some plants for planned maintenance because of expected power shortages.

Luoping said the company ran 60% of its capacity in the first quarter after snowstorms disrupted power and one third of capacity since mid April. A seasonal drought led to serious shortages with power supply cut to almost one third of normal.

Goldman Sachs Group Inc said on April 17th 2008, an electricity shortage that shows no sign of abating is limiting metals production and boosting commodity prices. Copper, aluminum and zinc output were reduced this year in China and South Africa because of a lack of power.

Mr Cai Jinrong an analyst at Wanxiang Resources Co said “It will be serious if the power cut spreads to bigger producers in the province. Producers can ramp up production after the power is restored, but the market trades on short-term changes in supply and demand.''

According to Beijing Antaike Information Development Co Luoping is among the top 15 Chinese zinc producers.

Xinxing Pipe to buy stake in New Yegang's mill

It is reported that Xinxing Pipe Corporation and Hubei New Yegang Co signed an acquisition & restructuring framework contract in Beijing.

As per report under the contract, Xinxing Pipe Corporation will buy 60% stake by cash in Huangshi Xinxing Pipe Co, which is invested by Hubei New Yegang Co and its cast pipe company leaving the left 40% to be held by New Yegang Co.

Dalian Port gets first vessel of iron ore from Hope Downs

It is reported that in the morning of April 20th, the first ship of 17 tonnes high grade iron ore was unloaded at Dalian port which was bustled with the loud sounds of drums and the dance of Chinese lions to welcome the ceremony for the maiden voyage of ore from Hope Downs.

The ceremony was held by Austrialian Rio Tinto and Ansteel together. Mr Fu Bin and Li Xiongfei the vice general manager of PDA corporation, Mr Wang Heng manager of international business in Ansteel, president of marketing and sales department of Rio Tinto mining group, president of the Hancock Prospecting directorate and some other guests from home and aboard and news media of about 200 people witnessed this moment.

Mr Fu Bin the vice general manager of PDA Corporation made a speech on behalf of his company. He said that Ansteel is the most important iron producing base in China, Rio Tinto is a world famous ore producing company, and PDA is the most important international business port in northern China. With the rapid development of Chinese economy, the continuing increase in foreign trade and the increasing importation of resources, the cooperation of the three sides will forcefully advance the construction of international voyage center in northeast Asian and the development of Dalian Port.

Hope Downs is a cooperative program of Rio Tinto, and its one stage production realized 22 million tonnes. It will be the largest ore supplier for Ansteel.

Baori Wire makes new production records

It is reported that Baori Wire’s major parameters of performance, sales revenue and profit of steel wire grew by 19%, 28% and 63% respectively in the first quarter of 2008, the best in its history.

The release added that “Baori Wire keeps stainable development after its secondary steel wire project committed last year.”

Currently, the cold heading steel wire of the company has become a stable supply source for many home abroad joint ventures. In addition, further nationalization of automobile fasteners has come into a material stage. The cold heading steel wire by deep process to the end-use parts products in batches has already universally used in making brands cars.

COSCO plans USD 2.3 billion vessel buying

It is reported that China Cosco Holdings has revealed a massive new building plan for 25 vessels worth a total of USD 2.3 billion as it posted a 135% surge in its 2007 net profit.

The Shanghai and Hong Kong listed flagship of state owned China Ocean Shipping Company, which controls the largest bulk fleet in the world and boxline Cosco Container Lines, said that eight of the 25 vessels will be 13,350 TEU containerships to be built by Nantong Cosco KHI Ship Engineering Co 50:50 joint venture between its parent and Japan’s Kawasaki Heavy Industries.

The remaining 17 newbuilding vessels consist of nine 57,000 DWT bulk carriers to be built by Cosco Shipyard Group Co and eight 20,500 DWT bulkers by NACKS said the company. It did not disclose the unit price and delivery dates of the vessels.

Cosco Holdings has earmarked half of its planned capital spending budget for 2008 to support this massive new building plan and has expanded its capital expenditure by 36% from last year’s Yuan17bn to Yuan23.3bn in 2008.

Spending on the purchase of boxships will take up CNY 6.9 billion of the funds and CNY 4.9 billion will be used to pay for the firm’s bulk vessel orders. Cosco Holding, the parent of container port operator Cosco Pacific will invest CNY 4.4 billion in port development and Yuan3.4bn in the purchase of containers.

The group earned net profit of CNY 19.5 billion last year with its revenue rose 37% to CNY 108 billion.

Shanghai Port earnings up 14% on cargo boost

Shanghai International Port, China's biggest port operator by throughput posted a 14% rise in first quarter profit to USD 145 million compared with USD 127.8 million thanks to a robust growth in cargo throughput.

Shanghai International Port revenue was up by 23%YoY to USD 603.5 million. The port’s container throughput hit 6.61 million TEUs up by 12.2% YoY while cargo throughput in the period up by 4.8% to 89.5 million tonnes.

China Railway Group 2007 profit up by 92% on construction boom

It is reported that China Railway Group Ltd, Asia's largest construction contractor 2007 profit soared by 92.2% helped by the building boom in the world's fastest-growing major economy.

China Railway Group Ltd said its net income jumped to CNY 3.16 billion or CNY 0.24 per share based on domestic accounting standards. Revenue rose 13.2% to CNY 180.5 billion. Its newly signed contracts were valued at CNY 248.5 billion up by 25.8% YoY more than a year ago.

China Railway Group Ltd said, citing Ministry of Railway's statistics that China's investment in railway construction reached a record high of more than CNY 250 billion last year increase by CNY 43.2 billion more than a year earlier,

Mr Shi Dahua China Railway's chairman said in the statement that "The nation's robust economic growth would continue this year to boost demand for domestic infrastructures, in particular the transport. He noted China planned to invest a total CNY 3.8 trillion in transport infrastructure construction in the 11th Five-Year Period.

According to the statement during the five years, the government was expected to invest CNY 1.25 trillion in railway building and CNY 170 billion in inner-city rail construction. The statement said investment in highway construction was forecast to hit CNY 140 billion annually in the coming years through 2010 and CNY 100 billion before 2020.

China Railway, however acknowledged it also faced challenges, including the increasing fierce market competition, rising raw materials prices and uncertainties over the global economy and politics.

China shuts 83 small coal fired power plants in Q1 of 2008

Xinhua quoted the National Development and Reform Commission as saying that China has closed 83 small coal fired generators with an aggregate capacity of 4.7 million kilowatts during the first three and half months of 2008.

Mr Zhao Yinong an official with the State Energy Administration under the NDRC said the closed capacity accounted for 36% of the 13 million kilowatt target set this year to save energy and reduce greenhouse gas emissions.

The report added that the closures would help China save 7.1 million tonnes of coal and reduce carbon dioxide emissions by 14.2 million tonnes annually, since the closed capacity would be replaced by larger, more efficient plants.

China plans to close small, energy intensive coal fired units with a total capacity of 50 million kilowatt between 2006 and 2010. The closed capacity will save 14.5 million tonnes of coal and cut sulfurdioxide emissions by 247,000 tonnes and carbon dioxide emissions by 29 million tonnes annually.

Antimonopoly body allows Illich to control SLAV Handels

Ukrainian Journal Staff reported that the Antimonopoly Committee has permitted Mariupol Illich Steel Mill in Donetsk region to buy a share in the statutory fund of Austria's SLAV Handels GmbH which gives over 50% of the votes in the governing body of the company to the buyer.

The committee said that SLAV Handels buys steel products in Ukraine and sells them on foreign markets.

Evraz's IPSCO loan reduced to USD 500 million – Report

Reuters quoted a banker as saying that Russian steel maker Evraz Group's syndicated bridge loan has been reduced to USD 500 million following the company's recent USD 1.6 billion Eurobond transaction.

The banker said "I think it is safe to assume you can take USD 1.6 billion off the original loan amount."

Evraz announced recently that it had completed a Eurobond transaction totaling USD 1.6 billion, consisting of five year and ten year tranches. It said proceeds were for general corporate purposes, including financing of the recently announced IPSCO acquisition.

The USD 2.1 billion nine month loans launched to syndication earlier this month. The deal pays a margin of 150 basis points for the first three months, then 200 bps for the next three months and 250 bps thereafter.

Arranging banks are ABN AMRO and Calyon. Reuters reported recently that the original USD 2.1 billion loans to back the borrower's purchase of IPSCO's North American plate and pipe business from Sweden's SSAB had been reduced, though a new loan amount was not disclosed.

Kazakhstan joining Baku-Tbilisi-Ceyhan oil pipeline project

Itar-Tass cited Mr Sauat Mynbayev Kazakh Minister of Energy and Mineral Resources while speaking at a meeting of the Kazakh-Azerbaijani intergovernmental commission for economic cooperation said Kazakhstan is close to the completion of the legal registration of documents on joining the Baku-Tbilisi-Ceyhan oil pipeline.

Mr Sauat Mynbayev said “The Kazakh side informed the Azerbaijani colleagues that literally tomorrow the republic’s upper house of parliament will consider the draft law on the ratification of the republic’s agreement with Azerbaijan on support and assistance in the transportation of oil along the Baku-Tbilisi-Ceyhan system.”

He also noted that “experts of the Kazmunaigaz Company are staying in Azerbaijan and we hope in the short run to settle all technical nuances linked with the formation of the seas part of the Kazakh-Caspian transportation system.”

The lower house of Kazakhstan’s parliament on March 26 approved the draft law on the ratification of the republic’s agreement with Azerbaijan on support and assistance in the transportation of oil along the Baku-Tbilisi-Ceyhan system. The document envisages the creation of a new scheme of transportation of Kazakh oil via the Caspian Sea with its further pumping through this pipeline. The new oil transport infrastructure will be created with the implementation of this project.

The Baku-Tbilisi-Ceyhan pipeline is a crude oil pipeline that covers 1,768 kilometers from the Azeri-Chirag-Gyuneshli oil field in the Caspian Sea to the Mediterranean Sea. It connects Baku, the capital of Azerbaijan; Tbilisi, the capital of Georgia; and Ceyhan, a port on the south eastern Mediterranean coast of Turkey, hence its name. It is the second longest oil pipeline in the world after the Druzhba pipeline. The first oil that was pumped from the Baku end of the pipeline on May 10th 2005 reached Ceyhan on May 28th 2006.

Bulgargaz and Gazprom to set up JV for South Stream pipeline

RIA Novosti cited Mr Alexander Medvedev deputy chairman of Gazprom's Management Committee as saying that Gazprom and Bulgargaz, the Russian and Bulgarian state controlled gas distributors will sign an agreement for the creation of a company to design the section of the trans Black Sea South Stream gas pipeline that will cross Bulgarian territory.

The report added that both he countries signed in January 2008 an intergovernmental agreement on the project, splitting evenly the project company equity and opting for a Bulgarian domicile. The Bulgarian Russian agreement has been submitted for review by the competent ministries. It will also have to be ratified by parliament.

According to the text of the agreement posted on the website of the Bulgarian economy ministry, Gazprom is named as the operator of pipe on Bulgarian territory. In addition to the bilateral agreements with Bulgaria, Serbia and Italy a further multilateral intergovernmental accord will also be signed with the countries lying on the route of the facility.

Ms Galina Tosheva deputy economy minister of Bulgaria said recently the undersea section of the pipeline will be built and operated by a different company where Bulgaria will have no stake. The talks in which Gazprom was involved had made progress and that investment was deemed risky.

Gazprom holds regional policy commission meeting

Gazprom’s Regional Policy Commission has convened on its regular meeting moderated by Mr Valery Golubev head of the Commission, Deputy Chairman of the Gazprom Management Committee.

The Commission discussed issues concerning the execution of the Development Program for an integrated gas production, transportation and supply system in Eastern Siberia and the Far East, taking into account potential gas exports to China and other Asia-Pacific countries.

In particular, a focus was put on issues with regard to the organization of interaction between Gazprom, federal and regional authorities as well as oil and gas companies during the Program execution.
Special emphasis was placed on Gazprom’s role of the Eastern Program coordinator pursuant to the assignment of the Russian Federation Government.

Following the meeting results the Company’s core business units and subsidiaries received appropriate tasks.

Belarusian truck maker considers foreign car assembly project

RIA Novosti reported that Belarusian truck producer MAZ is considering starting the assembly of light vehicles mostly for the Russian market and is in talk with foreign carmakers.

Mr Nikolai Kosten general director of MAZ said "We are holding talks with three foreign companies AvtoVAZ a German and a Chinese company. He said it would take two or three years to coordinate everything, which would be followed by the preparation and equipping of the production facilities for the assembly of the cars.”

Mr Nikolai Kosten said annual output will initially be between 20,000 and 50,000 cars most of which will be sold on the Russian market.

State-owned MAZ is one of the largest state producers of heavy duty trucks as well as buses, trolley buses, trailers and semi trailers in Eastern Europe. The company sells around 60% of its vehicles to Russia, over 19,000 units in 2007.

RZD and North Korean Railways to implement pilot project Khasan-Rajin

Itar-Tass quoted RZD corporative communications department reported that Mr Vladimir Yakunin president of the Russian Railways Company and Mr Kim Yong Sam North Korean Minister of Railways signed a cooperation agreement recently.

Prime-Tass reported that the sides agreed to implement a joint railway pilot project Khasan-Rajin, which envisages the reconstruction of the Tumangan-Rajin railway line, the construction of a container terminal at the North Korean port Rajin and further operation of this infrastructure.

Under the agreement the RZD Company and the port Rajin will set up a joint venture company. This joint venture will attract investments for the funding of the project and will attract subcontractors for the designing and the reconstruction of the 52 kilometer long Tumangan-Rajin railway line and the construction of a container terminal at the port Rajin.

The joint venture company was established for 49 years with Russia possessing 70% of the stock and North Korea 30%.

Russia to supply 8 million tonnes of LNG to Japan in 2009

RIA Novosti reported that from 2009, Russia will supply 8 million tonnes of liquefied natural gas annually to Japan through the Sakhalin II oil and gas project.

The spokesman said ahead of a Saturday meeting between Mr Yasuo Fukuda PM of Japan, Mr Vladimir Putin president of Russia and Mr Dmitry Medvedev who chairs Gazprom that "Supplies to Japan will be launched no later than early 2009."

Mr Alexander Medvedev deputy chairman of Gazprom's management committee announced on Wednesday that the first gas deliveries as part of Sakhalin II were expected in early 2009. He said Gazprom planned to invest USD 45 billion in LNG projects by 2030 to become a major player on the LNG market. The company is seeking to supply about 90 million metric tons of LNG annually to world markets by 2030.

The Sakhalin-II project has estimated reserves of 150 million tonnes of oil and 500 billion cubic meters of natural gas.

Allegheny Technologies announces first quarter results

Allegheny Technologies Incorporated has posted net income of USD 142 million for the first quarter 2008 down by 28.2% YoY as against USD 197.8 million in the first quarter 2007.
First Quarter 2008 Financial Highlights

USD in million

Allegheny Technologies titanium product shipments reached 12.2 million pounds in the first quarter 2008 up by 26% YoY. Shipments of exotic alloys and grain oriented electrical steel grew by 38% YoY and 15% YoY respectively. Shipments of our high performance metals segment nickel based and specialty alloys decreased by 8% YoY due primarily to inventory management actions at some distributor customers.

Mr L Patrick Hassey chairman, president & CEO of Allegheny Technologies said that "Our key growth markets were solid in the first quarter. Demand from the global aerospace and defense, chemical process industry, oil and gas, electrical energy, and medical markets accounted for nearly 70% of sales. We derived 28% of our sales dollars in the first quarter from direct international sales. We believe that more than 50% of our sales are driven by demand from non US markets."

Mr Hassey said that "First quarter 2008 earnings were similar to those achieved in the fourth quarter 2007. As previously stated, we had expected the first quarter to be negatively impacted by certain raw material costs being higher than the raw material surcharges included in our selling prices for certain products. While this mismatch was largely offset by a LIFO reserve benefit of approximately USD 74 million in the fourth quarter 2007, there was no such offset in the first quarter 2008. Cash flow from operations was USD 66 million in the first quarter and included an investment of USD 149 million in managed working capital to support the higher business volumes, primarily in our flat rolled products segment. Cash on hand at the end of the quarter was USD 468 million after the managed working capital investment, USD 112 million in capital investments and USD 62 million of share repurchases."

"ATI is positioned to continue to benefit from the current and long term global growth opportunities of our major end markets. We continue our investments to give us unsurpassed manufacturing capabilities, which enable profitable growth. We are not only focused on product diversification but also on global market diversification. We are committed to maintaining a strong balance sheet. Although the condition of the U.S. economy, the impact of Boeing's 787 schedule delay and continuing raw material cost volatility create near-term impacts, we believe the first quarter 2008 earnings represent the bottom. Generally, base selling prices are flat to higher; volumes continue to improve; and raw material surcharges are in better balance. As a result, we expect second quarter earnings to be somewhat higher than first quarter results."

Charge and HC ferrochrome contract price spread widens

The majority of second quarter charge chrome and high carbon ferrochrome contracts have been settled, with the prices achieved showing a strong premium for the high carbon material.

The quotation for lumpy charge chrome and high carbon ferrochrome basis 6% to 8% carbon max rose to USD 1.92 to USD 2.10 per pound as compared with USD 1.20 to USD 1.22 per pound in the first quarter.

This is the first time that the spread in contract prices has exceeded 10 cents.

Second quarter prices rose from the first quarter on tight supply, caused by booming demand from the stainless steel sector and the power crisis in South Africa. Depreciation of the US dollar against the Rand and high prices for coking coal were also a factor in the higher pricing.

(Sourced from ferro-alloy.com)

Chinese wrought nickel exports dips by 76% YoY

Latest figures from the General Administration of Customs of China showed that China's unwrought nickel exports in March 2008 stood at 462 tonnes, which was a marginal 1.8% MoM increase as compared with the 454 tonnes exported in February 2008, but it represented a sharp fall of 76% YoY from March 2007.

Nickel exports over January to March 2008 quarter totaled 1,346 tonnes, down from 6,596 tonnes exported in the same quarter of 2007.

In March 2008, China imported 9,808 tonnes of unwrought nickel, down from 13,042 tonnes imported in February, but up from the 7,737 tonnes imported in March 2007. Total unwrought nickel imported in the January to March 2008 quarter was 35,688 tonnes, up from 29,559 tonnes imported a year earlier.

(Sourced from ferro-alloy.com)

ENRC confident of Q2 chrome premium

Eurasian Natural Resources Corporation is confident of securing a premium price for its high carbon material as it feels that the market is a bit stronger than the South African settlement of USD 1.92 per pound suggested when it finalizes its second quarter contracts for high carbon material.

Usually charge chrome and high carbon contract prices settle at similar levels. The low carbon ferrochrome market is very tight. Low carbon material basis 0.10% increased to USD 3.95 to USD 5.20 per pound on April 4th 2008 from USD 3.95 to USD 4.10 per pound previously.

ENRC will now scale up a 200,000 tonnes per year expansion of its high carbon ferrochrome operations. It believes that the ferrochrome prices will remain high in the coming years. It moved into the FTSE100 share index in March 2008 and recorded EBITDA of USD 1.7 billion. There is talk of a possible takeover of Kazakh copper producer Kazakhmys by ENRC.

Chinese molybdenum powder exports in March doubles

China also exported 677.199 tonnes of molybdenum powder in March 2008, up from the 567.584 tonnes exported in February 2008, and also a sharp rise from the 369.331 tonnes exported in March 2007.

Total molybdenum powder exported in the January to March 2008 period was 1,860 tonnes up significantly from the 729.345 tonnes exported in January to March 2007 period.

Molybdenum powder imports in March reached 20.379 tonnes up from 16.192 tonnes imported in February 2008 and also up from 16.448 tonnes imported in March 2007. Total imported amount in the first quarter of 2008 totaled 50.978 tonnes, which was a rise from the 47.388 tonnes imported a year ago.

(Sourced from ferro-alloy.com)

Chinese electrolytic manganese export slows down

According to statistics by China Customs, China exported 16,355 tonnes electrolytic manganese in March 2008 up by 10.2% YoY from February 2008. Export value was USD 55,362,315 increased by 26.2% YoY.

Compared with 2007, the high export volume in January 2008 has severely influenced the export later, both February and March. In 2007, export volume of the first 3 months was 17,821, 16,085 and 27,776 tonnes respectively, while 23,798, 14,837 and 16,356 tonnes for 2008.

Normally, export market of ferroalloys tends to be slim at the beginning of a year, but obviously recover in March. This year, export volume of most bulk alloys all increased by vast scale in March 2008, but export of electrolytic manganese still maintain low level. The total export volume in the first quarter is 54,991 tonnes down by more than 10% YoY from 61,682 tonnes of 2007.

As for chief importers, export volume to Japan, Russia and South Korea all recovered in March 2008, arriving at 4,388, 2,812 and 2,032 tonnes. Influenced by big stock in Rotterdam, export to Holland continued to slip, to 4,277 tons. Export volume to other countries is all below 1,000 tonnes.

(Sourced from ferro-alloy.com)

Shanxi coal industry to see many mergers in 2008

It is reported that in 2008 appears to be a year full of mergers and acquisitions in coal industry for the northern Shanxi province.

Total coal mine numbers will be squeezed down by over 30% by 2010 to shape a scenario of two 100 million tonne and three to five 50 million tonne large scale mines. Combined output of leading mines should account for at least 70% of the total in the province by then.

Currently, total coal mine numbers in the province has been cut to 2810 from the previous 4389 by means of closing down small mines and primary resources consolidation, a decrement of up to 36%, officials from local coal bureau noted yesterday. National key and local leading coal mines have produced over 60% of the total output in the province. Percentage extraction has hiked to nearly 70% from 25%.

Shanxi authority is ready to issue a directory to promote local coal industrial concentration rate. Several measures would be taken to achieve this
1. To boost regrouping between large state run coal mines and a collection of local medium and small scale mines to put a batch of large mines under control.
2. Forming some management companies to put those mills with low safety control and administration levels under trust. Those companies are mainly formed by large state-owned coal mines or local authorities.
3. Mines should be allowed to aggregate small scale mills nearby.
4. Closing down a body of mills that do not conform to industrial policies. Those that have caused environmental pollution, without safety insurance or located irrationally are also on the blacklist.

(Sourced from MySteel.net)

Teck Cominco denies early closure of Kimberley project

It is reported that Canadian miner Teck Cominco has denied reports it plans to close its Lennard Shelf Project in the Kimberley a year earlier than originally planned. Teck Cominco said it is on track to continue producing zinc from the mine for another 18 months. It said the original feasibility study only ever indicated a mine life of three years.

Mr Dan Gignac project manager admitted over supply of zinc in the market and poor prices has had an impact on profit but said that it will not force the mine's early closure. He said "We are committed to helping our employees find other work when the time comes, but as I say, we're 18 months away from that date."

He added that "The process has begun whereby we're looking at redundancy and those sorts of things, but we've got a little bit of time ahead of us before we finalize that plan."

Itera won auction of the Apsatskoe coal deposits

AK&M reported that OGC Itera on behalf of the company Arctic Development became the winner of the auction on the right of development of the Apsatskoe coal deposit in Zabaykalsky region.

The Apsatskoe coal deposit is located in the north of the Chita area. Stocks of coal make 2.2 billion ton, of methane up to 180 billion cube m.

Itera the independent gas company owns 63.5% of shares of OJSC Yugankneftegaz and 26% of shares of OJSC Sibneftegaz. The basic participant of the Society is Cyprian Itera Holdings Ltd which is supervised through Itera Group by Igor Makarov and Indian Sun Group.

Massey Q1 profit up by 28.5%

Massey Energy Company reported that its first quarter 2008 net income increased by 28.5% YoY to USD 41.9 million from USD 32.6 million in the first quarter of 2007. The improvement was driven largely by increased produced coal revenue, which increased 4.5% YoY to USD 543.2 million and higher operating cash margin per ton, which increased 8.5% compared to the first quarter of 2007. EBITDA in the first quarter of 2008 was USD 129.2 million compared to USD 117.7 million in the first quarter of 2007.

Massey in a statement said that produced coal revenue per ton during the quarter benefited from the expiration of some below market priced contracts and from the strength of the export market for steam and metallurgical coal. Utility and metallurgical coal price realizations averaged USD 47.89 and USD 80.63 per ton, respectively, in the first quarter of 2008, versus USD 45.01 and USD 73.68 per ton, respectively, in the first quarter of 2007. Total produced tons sold during the quarter were 9.6 million compared to 9.9 million in the first quarter of 2007. The decline in tons sold was entirely in the utility coal category and was related primarily to tight availability of rail cars in February and March. Sales of metallurgical and industrial coal remained consistent with 2007 levels a