Indian steel majors roll back rebar price hike

It is reported that Indian steel ministry has convinced major steel producers to roll back prices of long products by INR 2,000 a tonne as a part of its fire fighting exercise to rein in inflation.

Mr RS Pandey secretary steel after the meeting with steel majors said that “Producers of long steel products like TMT bars, prices of which had increased sharply, have agreed that they will roll it back. It is expected that these companies, including TATA Steel and RINL, will provide a relief of INR 2,000 a tonne to ensure that the common man is not hit.”

Mr Pandey said that the steel producers gave the government an assurance that they would adopt a transparent pricing system and the prices of various products would be regularly updated on their company websites.
He added that “The prices of secondary steel products, he said, had already declined by INR 1,600 per tonne to INR 2,000 per tonne. In any case, the Government was keenly watching the global price situation.”

The steel ministry has also advised companies to go in for long term contracts with consumers to prevent frequent price fluctuation from affecting industry.

Among the major steel producers who attended the meeting were the public sector majors SAIL and RINL along with private sector giants such as TATA Steel, JSW, Jindal Steel and Power, Essar, Ispat and Bhushan Steel.

It may be noted that Indian government has announced a series of measures aimed at controlling prices and has held meetings with industrialists to persuade them to keep prices under control. In case, steel producers do not agree to reduce prices, the Union steel ministry, given its resolve to rein in prices, may be forced to recommend fiscal measures to ease supplies.

SAIL RSP posts record performance for 2007-08

Steel Authority of India Limited’s Rourkela Steel Plant has posted all time best performance in major areas of production mainly hot metal, crude steel and total saleable steel since inception.

Performance highlights are
1. Hot metal production of 2.229 million tonnes
2. Crude steel production of 2.093 million tonnes
3. Saleable steel production at 2.068 million tonnes
4. Capacity utilization of 114% in hot metal, 110% in crude steel and 124% in saleable steel

RSP's finishing mills also achieved more than 100% of annual performance plan.
1. Plates from plate mill 468,820 tonnes - 163% capacity utilization
2. Hot rolled plates 315,323 tonnes – 341% capacity utilization
3. Hot rolled coils 763,105 tonnes – 170% capacity utilization
4. Silicon steel mill 80,689 tonnes – 109% capacity utilization

RSP also took major initiative in enhancing profitability in its cost control effort by improving process parameters. All time best performance was recorded during the fiscal in coke rate per tonnes of hot metal, special energy consumption per tonnes of crude steel, water consumption per tonne of steel, lining life of LD converters and several others that contributed to improve RSP's techno economics.

SNS quoted Mr BN Singh MD of SAIL Rourkela Steel Plant as saying that it has been a champion in all parameters in the financial year 2007-08. He added that this has been made possible by its committed, dedicated and enterprising employees.

Mr Singh said that the plant has crossed its capacity in all areas of operation. He added that "RSP has surpassed the 2 million tonne mark in the production of crude steel as well as saleable steel, doing so for the first time in its history apart from crossing 2 million tonnes mark in the production of hot metal for the second time since inception. There has not been a single month in which any department has performed badly and not a single hour has been lost due to Indian Railway problems. This consistent performance has been possible because of the cohesion, team effort and harmony by our employees."

Indian steel majors cut prices of GC sheets

It is reported that Indian steel ministry has convinced major steel producers to roll back prices of and galvanized corrugated steel by INR 500 per tonne to INR 1,000 per tonne as a part of its fire fighting exercise to rein in inflation.

Mr RS Pandey secretary steel after the meeting with steel majors said that “As for GC steel sheets, the price cut would be to the extent of INR 500-1,000 a tonne.

Among the major steel producers who attended the meeting were the public sector majors SAIL and RINL along with private sector giants such as TATA Steel, JSW, Jindal Steel and Power, Essar, Ispat and Bhushan Steel.

SAIL SSP sets record for production and sales in 2007-08

Steel Authority of India Limited’s Salem Steel Plant has ended the financial year 2007-08 with many records in production, sales and techno economic fronts.

Saleable steel production of 230731 tonnes during 2007-08 has been the highest ever since inception with a record capacity utilization of 132% YoY and a growth of 26% YoY over 2006-07. This highest production consists of 58788 tonnes of stainless steel and 171943 tonnes of carbon steel products.

Sales during 2007-08 have also been highest ever at 224581 tonnes with a growth of 13% YoY over 2006-07. Out of this, 55352 tonnes have been stainless steel which includes 6153 tonnes of export and 169229 tonnes have been carbon steel.

In the techno economic front, lowest ever electrical energy consumption of 171 units per tonne and lowest LPG consumption of 37 kilogram per tonne have been achieved in hot rolling mill.

SAIL release said that “These achievements have been possible due to full involvement and commitment of employees and various innovations carried out to improve the operational efficiency of the plant.”

Indian cold rollers asked to cut prices – Report

It is reported that Indian government has asked cold rolled steel makers to voluntarily reduce prices as it is adding to inflationary pressures.

Mr RS Pandey secretary steel, in a meeting with representatives of secondary steel producers’ associations and makers of sponge iron, pig iron and CR steel recently, said that prices of CR steel should be brought down voluntarily. The government’s contention is that CR steel firms are boosting their profit margins by raising price.

However, domestic CR steel producers said that the price hike is inevitable given the sharp rise in hot rolled steel prices and proposal to the government to ban HR steel exports. Hot rolled steel accounts for 70% to 80% of the cost of producing CR steel. As per reports, cold rollers have asked the government to deal with supply side issues first.

Mr SC Mathur president of CR Steel Manufacturers Association said that "As of now there’s a demand supply gap of 2 million tonnes of HR steel in India. While some steps have been taken by cutting down export incentives, it will not be enough to stop the HR steel makers from exporting and therefore, additional measures need to be taken."

Panchmahal Steel commissions new SMS

Panchmahal Steel has successfully commissioned the new steel melting shop that will increase the steel making capacity of the company from 50,000 tonnes to 150,000 tonnes per annum.

Panchmahal Steel has a product range which includes austenitic, martensitic, ferritic and precipitation hardening grades in various sizes and finishes in the form of billets, hot rolled bars, wire rods, cold finished bars and wires.

Panchmahal Steel is a member of the All India Stainless Steel Industry Association, Indo French Chamber of Commerce & Industry, Export Import Club of India and other organizations.

BAI seek government intervention in steel prices

BL reported that the apex bodies of construction industry under the aegis of Builders’ Association of India has sought government intervention to rein in steel price hike and warned that contractors executing key projects for the Central Public Works Department and for the Commonwealth Games may be forced to close the work if the situation did not change. It is asking the government to set up a regulatory authority for the steel sector.

Mr Ralhan Lal Chand chairman of Builders’ Association of India said that with all major steel producers having captive mines and with importing of the balance requirement of coking coal from Australia, Africa and other countries, input costs varied with each producer. He said that "But still it is observed that selling prices of steel are by and large uniform despite each plant having different production cost. This leaves room for doubt that steel producers are acting in concert."

Mr DL Desai general treasurer of Builders’ Association of India said that the average price has steadily increased from INR 17,750 in July 2002 to INR 35,000 per tonne in January 2008 and to INR 48,500 a tonne in March 2008. He added that "The construction industry’s growth rate has slowed down to 9.6% in the current fiscal from 16.5% in 2005-06." Mr Desai further added that the average profit of 3 major steel producers namely TATA Steel, SAIL and RINL, however, has soared.

BAI also expressed doubts about completion of projects connected with the Commonwealth Games 2010 as the two recent tenders one for constructing a hostel cum media centre and another a wrestling stadium did not attract any bids.

Scrap and pig iron price hike takes toll on foundry units in Agra

It is reported that the foundry industry of Agra, which ranks among the oldest industrial clusters of India, is struggling to survive in the wake of competition from foundries in other states, where the units use better technology and its survival efforts have got a fresh blow with the unprecedented rise in the prices of scrap & pig iron.

According to Mr Amar Mittal president of Agra Iron Founders Association, the scrap metal prices have risen by almost 50% over 6 months. The foundries, however, were unable to raise the prices of the manufactured goods as a large part of the production was being undertaken on contract rates, agreed upon at least a year back with the buyer.

Mr Mittal said that over the last 6 months, the prices of iron scrap had risen from INR 18 per kilogram to INR 25 per kilogram, while pig iron had shot up from INR 22 per kilogram to INR 30 per kilogram, causing a 50% rise in the production cost. He said that “As a result foundries in Agra had dropped their production rates to nearly 25% to 30% of the original production but even that was not helping them much, as the units had to comply with the minimum gas consumption guarantee agreement signed by them with the Gas Authority of India Limited.”

POSCO supporters change stand after April 1st events

SNS reported that the total collapse of administration in the wake of the Vikalp Vikas Samavesh by anti POSCO groups has outraged locals who were supportive of the government and the project. As per report, several people of Nuagaon and Gadakujang panchayat who had actively helped the administration to carry out socio economic survey work have now turned against the administration.

Angry villagers while questioning the motive of the administration said that "The April 1st 2008 incident has proved that it is safer to join hands with anti POSCO groups. It is better to join hands with the anti POSCO groups who established the fact that they have support from various parts of India."

Agitated people of Nuagaon protested saying that the government claims to be committed to the project and yet everybody remained silent when hundreds of anti POSCO activists violated the law, broke barricades, indulged in vandalism and successfully held an impressive meeting at the prohibited Balitutha area.

Mr Soumendra Nayak panchayat samiti member of Nuagaon further added that at least 75 families who were actively supporting the project and participating in committee meetings to facilitate displacement etc have joined hands with the anti POSCO movement leaders.

Over the last 6 months villagers of Gobindpur, Nuagaon and Gadakujang had worked tirelessly with the local administration to ensure smooth conduct of the socio economic survey work. A United Action Committee was formed to facilitate the project and villagers joined the committee to push the project forward.

Indian Railways invites fresh bids for cast wheel plant

BL reported that Indian Railways has floated fresh tenders, inviting companies to bid for the construction of a cast wheel manufacturing plant in Bihar at an approximate cost of works around INR 780 crore.

An official close to the development said that "Originally, the Indian Railways wanted to adopt a public private partnership route for the plant and we had evinced interest. In a presentation to the officials concerned last year, we quoted an investment of INR 500 crore for the proposed plant that would manufacture 150,000 wheels annually at Chhapra in Bihar. Later, they decided to set up the facility on their own and invited global tenders for supply of plant equipment for which TATA L&T submitted the bids."

As per the original plan presented late in 2007, a Greenfield facility to be owned by a separate company, in which Amsted will have a 30% stake, JP Morgan OEP 25% stake and the remaining 45% stake owned by Patil Rail was to be formed.

According to industry sources, this renewed attempt has caused delay in the supply of the essential component especially since the demand for freight wagons has increased considerably in recent times.

Currently, the wheels are supplied by the Rail Wheel Factory, which Indian Railways owns. It has a manufacturing capability of 130,000 wheels a year. Incidentally, this plant was set up by Amsted. Another 70,000 wheels are produced by SAIL’s Durgapur plant and the balance is imported as the Indian Railways requires around 300,000 wheels annually and the requirement is growing at 20% annually.

MIDHANI turnover crosses INR 250 crore

BS reported that Hyderabad based defense sector undertaking Mishra Dhatu Nigam Limited has posted a sales turnover of INR 256 crore and a profit before tax of INR 27 crore during 2007-08 while, the order book stands at INR 700 crore.

Mr M Narayana Rao CMD of Midhani said that it is for the first time the company has crossed the INR 200 crore mark in its sales after its turnaround in 2003-04.

He added that "It has embarked upon a modernization and up gradation program partly funded by its strategic customers and from its internal resources to meet the hi tech special material requirement of the ambitious Chandrayan and other programs of the department of space and also the core of India’s nuclear program's fast breed reactors."

Set up primarily for achieving self-reliance in critical materials, Midhani has been supporting programs of national importance in strategic sectors including space, defense, aeronautics and atomic energy. Advanced aerospace technologies have also been employed as a spin off to develop and manufacture a wide range of low cost titanium bio medical implants, which have been supplied to various hospitals in India.

JSW Steel defers listing Dutch unit on LSE

Reuters reported that JSW Steel Limited has deferred listing its Dutch mining unit on the London Stock Exchange due to uncertainties in the global economy.

The report cited Mr MVS Seshagiri Rao director of finance at JSW Steel as saying that "Looking at the current market situation, we will not do it now."

Mr Rao said that it was yet to decide on the amount and what it planned to do with the money.

JSW Steel, which holds a majority stake of 70% in the Netherlands based subsidiary, had announced its listing plan in January 2008.

TATA Power profits USD 52 million via Bumi

DNA reported that TATA Power’s USD 1.2 billion investment in Indonesian Bumi Resources has already started paying dividends.

PT Bumi Resources reported a hefty 255% YoY increase in net income of USD 789 million in 2007 as compared with USD 222 million in 2006. A back of the envelope calculation reveals that the profits accruing to TATA Power would be about USD 52 million as Bumi Resources said core net income rose by 67% YoY to USD 317 million in 2007 as compared with USD 190 million in 2006, after adjusting for TATA Power’s minority interest in Bumi’s coal assets from July 1st 2007.

An analyst said that the USD 52 million profit accruing to TATA Power is on a pro rata basis as it is only for 6 months because TATA Power’s association with Bumi began in July 2007. He added that, for 2008, TATA Power could double its earnings from Bumi, if profits and demand for coal remain on the same keel.

In July last year, TATA Power, through a special purpose vehicle, acquired a 30% stake in KPC and Arutmin Mines owned by Bumi resources. Bumi Resources owns 2 mine blocks namely KPC and Arutmin which currently has proven reserves of 1.1 billion tonnes. As per the off take arrangements signed between TATA Power and Bumi, the power company will source 10.5 million tonnes plus or minus 20% of coal per annum from the KPC and Arutmin coal mines of Bumi Resources. The agreement is for 10 years beginning from financial year 2011.

NALCO and BEML join hands for aluminum coaches

It is reported that National Aluminum Company has entered into a MoA with Bharat Earth Movers Limited for production of aluminum wagons and aluminum rail coaches. Mr CR Pradhan CMD of NALCO and Mr RK Rustagi director HR of BEML have signed the MoA.

According to the agreement, the products would be jointly developed. NALCO would supply aluminum extrusions after conversion from its billets and ingots through a third party.

Aluminum wagons and coaches have advantages of light weight, higher carrying capacity, environment friendliness and lower life cycle cost.

SJVNL to generate 6,600 million units power in 2008-09

BS reported that Himachal Pradesh based Satlej Jal Vidyut Nigam Limited is aiming to generate a record 6600 million units of electricity in this financial year. It has built and now runs India’s largest hydel project namely the 1500 MW Nathpa Jhakri project in Himachal.

A SJVNL official said that "It plans a gross energy generation of 6600 million units with an expected revenue realization of INR 1378 crore during 2008-09 from the 1500 MW Nathpa project. A MoU to this effect was signed between Mr Anil Razdan union power secretary and Mr HK Sharma CEO of SJVNL."

The official said that “The MoU also targets construction of the 412 Rampur project to be coming up on the Sutlej river and filtered waters of the Nathpa project are being diverted to the Rampur project downstream. The MoU also provides for excavation of 5250 meters of the 15 kilometer long head race tunnel of this project by March 2009. It also spells out schedules for submission of detailed projects reports of 2 other hydel projects, the 252 MW Devsari and 56 MW Naitwar Mori hydel projects located in neighboring Uttarakhand."

He further added that "According to the deal, the ministry of power will support SJVNL as to be designated as a schedule 'A' company and help it join the club of Mini Ratna PSUs. Three years ago it has already entered the selected club of Central Public Sector Undertakings, who sign a MoU with the government of India every year. Last year SJVNL achieved a record power generation of 6450 million units surpassing the target of 6397 million units."

Sikkim identifies 22 mega projects to generate 4430 MW power

It is reported that Sikkim Power Development Corporation has identified the prospective private developers for the 22 mega projects which would generate 4430 MW of power. The total estimated cost of these projects would be around INR 25,000 crore.

Out of this, SPDC would be partnering in 6 projects directly through JVs with private players on a 26:74 equity sharing basis. This includes
1) Teesta I – 280 MW, with Australia based SMEC Limited
2) Teesta II – 330 MW, with Hyderabad based Navyug Engg Limited
3) Teesta III – 1200 MW, with Delhi based Teesta Urja Limited
4) Panam project – 280 MW with Himagiri Energy Private Limited
5) Teesta VI – 500 MW, with Hyderabad based Lanco Energy Limited
6) Ranjit II – 120 MW, with Hyderabad based Jal Power Corporation

The total cost for the projects would be around INR 15,000 crore and the total capacity would be around 2,710 MW. The remaining 16 projects would be developed by the players like NHPC which has two projects.

Mr P Wangchen principal secretary at energy & power department, government of Sikkim said that "The prospective developers on built, own, operate and transfer principle would provide 12% free power for the first 15 years and 15% thereafter to the state of Sikkim."

Mr Wangchen said that consequently, once all these projects are commissioned, Sikkim would earn around INR 1,500 crore as revenue from power trading alone at present rate, excluding the dividend income from the equities. He added that "Presently with annual revenue of INR 100 core, the power department is the highest revenue earner among the various government departments and after completion of all the proposed power projects, our revenue generation would jump 15 times."

He added that 510 MW Teesta V would be fully commissioned by the end of April 2008. He said "Apart from four ongoing small hydel projects under development with capital subsidy support from the ministry of renewable energy, 9 new projects have been identified and planned to be taken up during 11th plan by arranging fund through external borrowing."

Mr Wangchen concluded that the total cost of the 9 projects would be around INR 470 crore. This implies that the Sikkim government is planning for 31 new hydel power projects, with a total capacity of 4,489 MW and these projects would be commissioned by the end of 11th Five Year Plan. This includes 9 small projects with a total capacity of 59 MW and 22 mega projects with a total capacity of 4430 MW.

Indian Railways DFC to see funds in early 2009

BL reported that Indian Railways is expecting to start receiving funds for its ambitious dedicated freight corridor project from early 2009.

Mr KC Jena chairman of Indian Railway Board said that "The Western corridor is expected to cost INR 23,680 crore including escalation and interest during construction. This also includes the cost of electric locomotives as the Japanese agency linked the funding to this aspect. For the Eastern corridor, the cost works out to about INR 19,613 crore. We are in talks with multilateral agencies for the funding of Eastern corridor."

Steel Strips wins major wheel supply order from Renault

Steel Strips Wheels Limited recently announced that it has received an INR 110 crore order for supply of about 1 million steel wheel rims over a period of 5 years from French carmaker Renault.

This export order is for one of Renault's new vehicle to be produced in Europe.

Steel Strips Wheels expects its exports to grow over 200% in 2008-09. During January to March 2008 quarter, it registered a growth of 24.27% YoY in sales of wheels rims over the previous year.

BEML plans INR 115 crore CAPEX for 2008-09

It is reported that Bharat Earth Movers Limited is planning a capital expenditure of INR 115 crore during 2008-09 to modernize all its manufacturing units in Bangalore, Mysore and Kolar Gold Fields. In 2007, it invested INR 157 crore for modernization of the plant and machinery in all major manufacturing divisions.

Mr V RS Natarajan CMD of BEML said that besides bringing rail unit 2 on stream at Kolar Gold Fields in 2007-08, BEML completed setting up a new assembly facility for manufacture of transmissions at Kolar Gold Fields and a new automated assembly line for engines at Mysore complex. He added that it had drawn up a modernization plan involving an outlay of INR 415 crore spread over 5 years starting 2004-05. Of this, till now it has spent INR 215 crore and the remaining amount will be spent during the next couple of years.
Mr Natarajan said that meanwhile, it has increased the CAPEX plan to INR 550 crore by adding another INR 100 crore from the funds raised through a follow on public issue in July 2007. It had raised INR 526 crore to meet its modernization expenses. He added that BEML will soon commence assembling BEML products in Brazil where it has formed a JV company called BEML Brazil Paricipacoes Ltd for an initial investment of INR 100 crore spread over 2 to years.

According to Natarajan, BEML will initially export 25 machines to Brazil and market them through its JV. The machinery includes excavators, dozers and loaders. He said that "Once we sell these machines we will start assembling them locally for the Brazilian market."

Mr Natarajan said that BEML’s new JV company BEML Midwest Limited has bagged orders worth INR 96.32 crore. This includes the first contract mining project at Manganese Ore India Limited valued at INR 3.35 crore. For 2007-08, BEML has declared an interim dividend of 55% as against 120% for 2006-07.

Mr Natarajan further added that the trading division of BEML has made a head start by achieving sales of non BEML products to the tune of INR 160.83 crore during 2007-08. Its technology division also contributed well by doing internal billing to the tune of INR 11.69 crore and direct billing of INR 7.6 million.

BHEL announces provisional results for 2007-08

Bharat Heavy Electricals Limited has announced the following tentative financial results, as approved by its board of directors in its meeting held on April 3rd 2008.

BHEL’s turnover rose to INR 21,608 crore in the year 2007-08 up by 15% YoY from INR 18,739 crore in 2006-07. The net profit rose from INR 2,415 crore in 2006-07 to INR 2,815 crore in the latest fiscal, up by 17% YoY.

INR in crore
Based on enhanced equity post bonus issue

The order inflow also crossed INR 50,000 crore mark in the year. The order inflow rose to INR 50,265 crore in 2007-08 up from INR 35,643 crore in 2006-07.

UBS increase coking coal price forecast for 2008

It is reported that UBS said that already high price of coking coal could go well beyond earlier forecasts.

Mr Peter Galloway analyst with UBS in a note to clients said that “Comments in the trade press indicate that supply deals for hard coking coal, and even some semi hard varieties, are taking place at USD 300 per tonne. That is well above his forecasted price of USD 225 per tonne for the 2008 contract year that started April 1, a figure that is already higher than consensus estimates.”

He said that “The reason why the prices are skyrocketing, relates to production issues in Australia and continued strong demand from the steel industry, especially in India and Brazil, both which are totally reliant in imported coking coals.”

Mr. Galloway pointed out that these are not yet benchmark settlements but noted that the prices are supported by comments from ArcelorMittal at a recent investor day in New York, where management spoke of their expectations of a 200% YoY increase in coking coal from USD 95 in 2007.

However, Mr. Galloway expects some relief in 2009, forecasting a return to normal production in Queensland in 2009 and a contract price of USD165.

ArcelorMittal acquires 50% share in Gonvarri Brasil

ArcelorMittal announced the acquisition of a 50% share of Gonvarri Brasil to form a Steel Service Centre joint venture. Gonvarri Brasil is one of the major players for servicing automotive, industry and distribution customers.

Gonvarri Brasil initiated its activities in 1999 with a first Steel Service Center at Curitiba in Paraná State, mainly dedicated to the automotive sector. In 2002, the Gonvarri Group opened a second Steel Service Center in Campinas to continue with its growth strategy in Brazil and for supplying the industrial sectors of the São Paulo area. Today the company is one of the leaders of the flat steel processing in Brazil and its activities include pickling, slitting, blanking, cutting to length, with a total processing capacity of around 1.3 million tons of steel. The Company has 320 employees and owns more than 80,000 square meters of facilities.

ArcelorMittal and Gonvarri group have had a close relationship for many years ArcelorMittal holding a significant stake in Gonvarri Holding and being a major supplier. The two groups already own a common facility at Senica in Slovakia, which started operations in 2007. With this acquisition, ArcelorMittal intends to build a strong presence in the Brazilian flat steel downstream segment, in line with the leadership of its Tubarão and Vega do Sul plants. Synergies will also be realized with ArcelorMittal Belgo's existing distribution network in Brazil, active both in flat and long products.

Mr Gonzalo Urquijo senior executive vice president and member of the group management board, in charge of Long Products and ArcelorMittal Steel Solutions and Services said that "This is a first step for Steel Solutions and Services in Brazil. This joint venture will allow ArcelorMittal and Gonvarri to become a major player in the Brazilian steel downstream market, with significant growth expected in the next years by operating state of the art facilities.”

Mr Jon Riberas CEO of Gonvarri said that "This JV is an important step in the strengthening of our relationship with ArcelorMittal, allowing us to develop synergies and paving the way for further partnerships. It will also allow us to further grow in this very promising market.”

MEPS forecast another record SS output in 2008

UK based MEPS said that “Global stainless steel production is still expected to reach a record level of 29 million tonnes this year.” MEPS added that “During the first quarter, most markets across the world have been quite soft. This was the result of unexpectedly large increases in steelmaking during the final trimester of 2007 in the EU and China.”

MEPS said that “These actions prompted us to make an upward revision to our estimate for 2007 global crude stainless supply, to a figure near to 27.9 million tonnes. This represents a modest one percent reduction on the outturn in the previous twelve months. The market was extremely tight in 2006 but last year it was in surplus. This is likely to be the picture throughout most of 2008.”

For EU MEPS said that “The steel mills in the EU have lost substantial volumes of export business to China over the past two years. Local market demand is fair but is not rising sufficiently quickly to make up for weaker foreign sales. Consequently, we predict total output this year rising marginally from 2007 but falling well below the 2006 outturn.”

MEPS said that “In Japan, inventory levels are excessive. The mills continue to regulate availability. A small output gain is forecast for 2008. Severe production cuts in South Korea have helped to control the oversupply situation. This is likely to continue to mid year. Rising steelmaking is anticipated in the second half. A similar picture is forecast for Taiwan.”

MEPS added that “Inventories in the US are at a low level. Demand on the mills should improve during the second half of this year pushing up total production to slightly above the 2007 figure but below the outturn in the boom year of 2006. Import volumes are likely to be reduced due to the weak dollar. We anticipate stainless steel production rising in 2008, year on year, in India, Brazil and South Africa. The gains will be limited due to relatively weak export markets.”

MEPS further added that “Despite poor demand in the early part of this year, we forecast higher output in China compared to 2007. However, the improvement will be at a much slower rate than in recent times. Substantial new capacity is available but plants will be operated at much less than maximum utilization rates”

Japan removes import duty for HC ferrochrome

Platts reported that Japan has removed its import duty for high carbon ferrochrome with over 4% carbon content effective from April 1st 2008.

An official at the Japan’s ministry of finance said that Japan had applied a 3.18% import duty for high carbon ferrochrome imported from countries that fall under Generalized System of Preferences, such as South Africa and Kazakhstan and a 5.3% duty was set for imports from non GSP countries like Norway.

The official said that it will maintain import duties for low carbon ferrochrome at 3.18% for GSP origins and 5.3% for non GSP origins.

Japan imports around 900,000 tonnes of high carbon ferrochrome a year. Imports from South Africa comprise around 50% to 60%, from Kazakhstan 30% to 35% and India 7% to 10%. Japan also imports 75,000 tonnes of low carbon ferrochrome annually. Imports from Russia account for around 50% and from South Africa and Kazakhstan 20% each.

POSCO E&C buys Daewoo Engineering for USD 222 million

Reuters reported that South Korean builder POSCO Engineering & Construction Co Ltd, a unit of POSCO had bought 60% of unlisted Daewoo Engineering Co for KRW 216 billion (USD 221.7 million).

The sale of the shares, held by Daewoo Engineering itself, comes as the construction unit, 90% owned by steel maker POSCO, is mulling a 2008 initial public offering in Seoul.

The acquisition is aimed at entering the booming petrochemical plant construction industry in line with growing demand for petrochemical products, as well as expanding overseas business which POSCO Engineering lacks.

A POSCO Engineering spokeswoman said that "Since Daewoo Engineering has benefited from the petrochemistry and energy industry abroad, POSCO came to obtain a controlling stake.”

Daewoo Engineering was spun off to its own employees from the Daewoo Group before the parent group failed in the late 1990s. It earned a KRW 13.8 billion net profit in 2007 on sales of KRW 445 billion.

Malachite Resources discovers tin at Elsmore project

ITRI reported that Malachite Resources said that they have made a significant new tin discovery at its 100% owned Elsmore Tin Project, located about 20 kilometer east of Inverell in northern New South Wales. The new discovery is at the Newstead Prospect, which comprises a large tin bearing greisen system, with associated alluvial and other surface deposits and numerous shallow old tin workings.

The new discovery is situated within Malachite’s EL6196 on freehold land and consists of semi-consolidated alluvial material that extends from surface to an unknown maximum depth, in excess of 3 meter. The full area extent of the alluvial deposit has not yet been determined but individual occurrences mapped so far range from about one hundred metres square to approximately one square kilometer, all within an area of 3.5 x 1.5 kilometer. It is not yet known whether the areas mapped separately link up beneath soil cover, but this is thought to be quite likely in some cases.

Mr Garry Lowder MD of Malachite Resources said that “This discovery comes at a time of record tin prices and offers us excellent scope to start a very competitive tin mining operation at low capital cost. The deepest we have drilled so far is 3meter, but from looking down some of the old shafts and pits in the area, the tin bearing wash appears to be at least 8m deep in places.

He added that “It is too soon to say just how much tin is present at Newstead, but a few thousand tonnes of contained tin looks like a reasonable resource target at this stage.” he further added that “The Newstead alluvial deposit also contains sapphires and our rights under EL6196 cover both metallic minerals and gem minerals.”

(Sourced from www.itri.co.uk)

Japanese structural steel demand to rise to 7 million tonnes

JMB reported that Sumitomo Metal Industries expects Japanese structural steel demand will increase to around 7 million tonnes for fiscal 2008 starting April from 6.5 million tonnes to 6.6 million tonnes in fiscal 2007.

Sumitomo expects following breakup of demand
1. H beam - 4 million tonnes
2. Sheet piles - 650,000 tonnes
3. Pipe piles – 650,000 tonnes
4. Light beams - 120,000 tonnes.

Vietnamese steel import in Q1 surges by 111% YoY

According to the Vietnam’s General Statistics Office, Vietnam imported over 3.4 million tonnes of steel billets and finished products worth more than USD 2.4 billion in the Q1 of 2008 up by 110.7% YoY and 161.9% YoY respectively.

The General Statistics Office said that between January and March 2008, the country imported 959,000 tonnes of steel billets, material for steel production valued at USD 595 million up by 88.8% YoY and 168.7% YoY.

According to the Vietnam Steel Association, Vietnam is accelerating production of steel billets and finished products, import billets from more countries, lower production costs and improve distribution networks to curb rising steel prices.

Vietnam had imported over 7.7 million tonnes of steel billets and finished steel products in 2007 mainly from China, South Korea, Malaysia, the Philippines and Singapore in 2007.

ArcelorMittal SA in competition trouble

It is reported that South African Competition Tribunal said that it has granted Barnes Fencing Industries and Dunrose the right to intervene in the Mittal Steel SA case currently before the tribunal. With this, Barnes Fencing may succeed in opening a second investigation into the steel giant's alleged contravention of the competition laws.

Barnes Fencing, which questioned the pricing of wire steel, initially lodged a complaint with the Competition Commission in December 2003 and after investigation the commission made a referral alleging that Mittal Steel SA had engaged in uncompetitive behavior by offering rival firms cheaper raw materials in the wire products industry.

Barnes makes wire, in particular galvanized wire for fencing and wire products from the wire rod, while Dunrose manufactures nails.

Mittal Steel SA, which is now trading as ArcelorMittal SA, was fined ZAR 692 million by the competition authorities after it was found guilty of contravening the Competition Act by abusing its dominance in the market for the supply of certain products. The first case, over excessive pricing of flat steel, was brought against it by Harmony Gold.

ICE & GlobalCOAL launch joint coal futures contracts

It is reported that GlobalCOAL and Inter Continental Exchange have joined hands to launch two new coal futures contracts on ICE Futures Europe

The contracts will consist of financially settled Newcastle Australia (NEWC R) coal futures, to be launched mid 2008 and physically settled Antwerp-Rotterdam-Amsterdam (ARA) coal futures, to be launched later this year.

Mr David Peniket president of ICE Futures Europe said that “Expanding further into the coal market is a natural extension of our global energy complex. We believe that the development of traded futures contracts will help to build liquidity and transparency in the coal marketplace, and provide producers and consumers with new tools for managing their price risk.’

Mr Eoghan Cunningham CEO of GlobalCOAL said that “The development of futures is the next stage in the commoditization of the coal market and will provide tremendous opportunity for investors and pure financial players, as well as physical coal market participants.”

Vale Xstrata tie up - Deal is dead

It is reported that Cia Vale do Rio Doce said that a deal to acquire Xstrata Plc to become the world's biggest mining company is dead.'

The report quoted Mr Fabio Barbosa CFO of Vale as saying that “"The operation is dead. The financial support is over, it made no sense keeping it. The Xstrata acquisition is over, it is dead. We do not have the financing.”

Vale also provided a copy of a thank you letter it sent to the financial institutions involved Santander, HSBC, Calyon, Citibank, BNP Paribas, RBS, Credit Suisse and Lehman Brothers. It said the deadline for Vale to use the credit expired on March 31st 2008. The letter said that “Vale is really confident that we will have other opportunities to work together in the near future."

A Vale spokesman said that "Now we're after new things organic growth and opportunities that may arise.”

Schnitzer Steel Q2 revenue up by 24% YoY

Schnitzer Steel Industries Inc announced net income of USD 36 million for the Q2 ended February 2008. The earnings per share were a second quarter record and quarterly revenues of USD 751 million were the highest ever. Compared to the second quarter of fiscal 2007, revenues increased 24% and earnings per share increased 34%.

Mr John D Carter president & CEO of Schnitzer Steel said that “Our second quarter operating results were strong. All three of our operating businesses recorded year over year growth in both revenues and operating income. Driven by continued strong worldwide demand for recycled metals, prices for ferrous scrap reached unprecedented levels, and our export platform continued to provide us the ability to sell to the regions of the world where demand was greatest. Prices in our Metals Recycling Business not only more than offset freight price increases which occurred in the first quarter of this year but also outpaced increases in the cost of acquiring raw materials. As a result, we were able to expand margins both sequentially and compared to the prior year.”

Mr Carter added that “The Auto Parts Business continued to show year over year improvements in both revenues and operating income through our ongoing focus on increases in vehicle purchases. The Steel Manufacturing Business benefited from positive supply and demand dynamics as selling prices increased due to shortages in finished steel resulting from a low level of imports.”

Schnitzer Steel Industries is one of the largest manufacturers and exporters of recycled ferrous metal products in the United States with 34 operating facilities located in 11 states throughout the country, including six export facilities located on both the east and west coasts and in Hawaii. The company's business also includes auto parts and steel manufacturing.

NAS starts to apply energy surcharge

It is reported that, driven by rising natural gas costs, North American Stainless Inc will introduce an energy surcharge on its products, following AK Steel and Allegheny Technologies Inc’s similar price mechanism which have implemented for more than 1 year.

However, North American Stainless has not released how much it will impose starting the shipment this month. But market participants said that North American Stainless did not impose energy surcharge since before is because North American Stainless has newer and energy efficient facilities than its rivals. Also, those competitors locate in states with higher power rate.

(Sourced from YIEH.com)

LKAB plans to increase iron ore pellet price

It is reported that Sweden’s Luossavaara Kiirunavaara AB is planning to raise its iron ore pellet price by 87%.

Italian steel marker, IIves and Brazilian iron ore producer, Vale, have decided upon their iron ore pellet prices. But LKAB will negotiate price with European customers soon.

This year, LKAB will produce 21 million tonnes of iron ore pellet, up by 3 million tonnes as compared to 2007. Also, until 2010, LKAB will only produce iron ore pellet.

(Sourced from YIEH.com)

Update on coal shipments from Newcastle in Q1 of 2008

Bloomberg reported that Newcastle port increased shipments of the fuel by less than expected in the first quarter as wet weather and lack of available coal crimped loadings early in the period.

Port Waratah Coal Services Ltd said that shipments at the port's two coal terminals rose by 6.8% to 22.26 million tonnes in the three months ended March 31st from 20.84 million tonnes a year earlier. That's an annualized rate of 89.5 million tonnes, less than the planned 95 million tonnes.

Port Waratah said that the average number of vessels waiting outside the port to load coal was 33 in the first quarter, down from 59 a year earlier. Ships had to wait an average of 13.1 days to load coal, down from 22.4 days.

Mr Graham Davidson GM of Port Waratah said that coal throughput via the rail and port system for the Hunter Valley mines was 6% below plan in January because of a lower arrival rate of ships at Newcastle, February throughput was about 9.1% below budget and March loadings were almost in line with plan,

Mr Davidson said that the queue is forecast to shorten through April and May after mining companies had their port capacity allocations cut by 1.1 million tons in March. He added that the reduction in allocations doesn't affect the amount of coal exported, rather the rates at which ships arrive off the port.

Hunter Valley Coal Chain Logistics Team, coordinator of coal transportation through the rail and port system in statement said that capacity through the rail and port system is expected to run at an annualized rate of 95.3 million tonnes in the second quarter. Hunter Valley Coal Chain Logistics Team said that the number of waiting ships should decline to 30 by the end of the month, from 41 at the end of March and then to 18 by the end of May.

Cigading Port to become Indonesia largest bulk port

Port World reported that Indonesia state owned steel maker PT Krakatau Steel will expand its Cigading port to become the country's largest port for bulk cargoes.

Mr Faswar Bujang President of Krakatau Steel said that Jakarta's Tanjung Priok, the country's largest port has been plagued by congestion. He added that the Cigading port at Cilegon in Banten has served as a special industrial port facilitating mainly import of industrial basic material to and exports of manufactured products from the Krakatau Steel Industrial Estates in that area.

Mr Faswar said that in fact loading and unloading of part of bulk cargoes including industrial and food products, previously handled by Tanjung Priok has been taken over by the Cigading port.

US steel import permit in March down by 2% MoM

Based on the Commerce Department’s most recent Steel Import Monitoring and Analysis data, the American Iron and Steel Institute reported today that steel import permit applications for the month of March 2008 totaled 2,413,000 net tons. This was a 2% MoM decrease from the 2,454,000 permit tons recorded in February 2008, and also a 2 percent decrease from the February preliminary imports total of 2,458,000 net tons.

Import permit tonnage for finished steel in March was 1,960,000 net tons an increase of 3% from the preliminary imports of 1,905,000 net tons in February. For the Q1 of 2008 including March, total steel imports were 7,537,000 net tons down by 13% YoY from the 8,655,000 net tons imported in the first quarter Q1 of 2007.

For March 2008, the largest finished steel import permit applications for offshore countries were:
1. China 233,000 net tons
2. Korea 189,000 net tons
3. Japan 133,000 net tons
4. India 117,000 net tons
5. Germany 80,000 net tons

Finished steel import permit applications for China declined by 1% in March compared to February preliminary imports. Product categories that increased in March vs. February preliminary include:
Cut Length Plates up by 110%
Standard Pipe up by 60%)
Oil Country Goods up by 43%
Hot Dipped Galvanized Sheet & Strip up by 35%

Products that showed an increase in Q1 2008 as compared to Q1 of 2007 include:
Oil Country Goods up by 44%
Standard Pipe up by 13%
Structural Shapes Heavy up by 6%

Mr Andrew G Sharkey III president & CEO of AISI said that “While imports overall in the first quarter of 2008 are trending below the level in the same period last year, finished steel imports this year on a monthly basis remain at a rate that is 10% higher than the monthly average in the last quarter of 2007. There is no reason to believe that injurious unfair trade in steel has been eliminated from the US market and AISI will continue to monitor closely imports of certain products from certain countries.”

Arch Coal named one of America’s most trustworthy companies

Arch Coal, Inc announced that it has been named one of America's most trustworthy companies by Forbes magazine based on its sound accounting practices and financial reporting.

The independent research firm, Audit Integrity, Inc identified Arch Coal among the top 15 large cap companies of 2008. More than 8,000 public corporations were considered for the Trustworthy 100 list. Arch was the only company listed from the US coal industry.

Mr Steven F Leer chairman & CEO of Arch Coal said that "Our selection as one of the most dependable and transparent US companies makes us extremely proud. We firmly believe that our sustained focus on integrity, transparency and corporate governance buoys investor and customer confidence and builds shareholder value."

Autlán to double Q1 sales to USD 83 million

BNamericas reported that Mexican manganese ferroalloy producer Minera Autlán expects to double sales year on year in the first quarter to MXN 876 million (USD 82.9 million).

According to Autlán, higher consumer demand for its products, due to increased global steel demand, a shortage of ferroalloy supply, as well as cost control strategy and investment projects, have led to the auspicious guidance.

It said that EBITDA is expected to surge some 500% YoY to 368 million pesos, buttressed by more exports to the US and a 30% price increase in ferroalloy products.

Autlán is part of Mexico's Grupo Ferro Minero, which owns the Molango and Nonalco mines and the Tamós and Gómez Palacio ferroalloy plants. It is carrying out a USD 40 million investment program in 2008.

Nucor ranked 25th in the BusinessWeek 50 top performers

For the third time in four years, steel maker North America's largest recycler Nucor Corporation appears on the BusinessWeek 50, which ranks top performing companies based on the rate of return on investment and sales growth over a three year period.

As per release “Nucor comes in at number 25 on the BusinessWeek 50 list, which was topped this year by luxury goods maker Coach. Other notables on the 2008 BusinessWeek 50 include Apple in 6th, Sunoco in 20th, Google in 34th, Microsoft in 40th and ExxonMobil in 50th. The rankings are in the April 7th issue of the magazine that is now on newsstands.”

Mr Daniel R DiMicco president & CEO of Nucor said that “Nucor is made up of a team of 20,000 dedicated men and women whose goal is to take care of our customers. We achieve this by working to be the safest, highest quality, lowest cost, most productive and most profitable steel company in the world. Being ranked regularly on the BusinessWeek 50 is quite an honor because it takes into account performance over multiple years and measures consistent, sustained growth."

Nucor was ranked on the BusinessWeek 50 as number 1 in 2005 and number 4 in 2007. Because of the way the list ranks companies based on growth factors, repeating on the list from year to year is difficult. The BusinessWeek 50 has been published annually since 1997, recognizing the magazine's top performers in each of the sectors that make up the S&P 500.

CEZ to reduce lignite fired capacity to 4,000 MW by 2025

Thomson Financial reported that Czech power group CEZ sees capacity from lignite fired plants falling to 4,000 MW from current capacity of just under 6,000 MW by 2025 provided the country's current mining limits stay in place.

CEZ in a statement said that the estimate includes the company's planned plant retrofits and new plants. It had earlier said it would spend CZK 100 billion on renewal of its lignite plants aimed at raising efficiency 14% to 25%. It added that if the mining limits were removed, capacity would stay around the same level as now.

CEZ said that limits that currently stop miners from exploiting about 1 billion tonnes of protected lignite resources were introduced in the early 1990s to protect villages in the north of the country, where the mines are situated. The current government, which includes junior partner the Green Party has said in its coalition that it has no plans to lift the limits.

CEZ, the country's dominant power producer, has been looking for ways to improve supply conditions for its coal fired plants, which make up around two thirds of its total output.

Vale ratings placed on review for possible upgrade - Moody

Moody's Investors Service said it has placed Brazil based Companhia Vale do Rio Doce's 'Baa3' local currency issuer rating and 'Baa3' foreign currency rating under review for possible upgrade

Moody said that the review will focus on the sustainable level of earnings and cash flow generation in a more normalized metals cycle and the company's level of debt within its capital structure.

Moody's also placed under review for possible upgrade the 'Baa3' foreign currency rating of Vale Overseas Ltd. and the 'Baa3' corporate family rating and senior unsecured rating of the Canada based Vale Inco a principal operating subsidiary of Vale.

Hillsborough inks coal agreement with Quinsam and Vitol SA

Hillsborough Resources Limited announced the execution of a coal offtake agreement between its wholly owned subsidiary, Quinsam Coal Corporation and Vitol SA, of Geneva, part of the Vitol Group a major international energy and commodity trading and marketing conglomerate.

The agreement covers the sale of 730,000 tonnes of thermal coal, of which 130,000 tonnes has already been announced and is due for shipment in the last quarter of 2008 at USD 91 per tonne. The balance of the off take coal is deliverable equally in 2009 and 2010 at prices based off the Newcastle index, less a small discount for the Canadian/Australian freight differential. Price for the final 600,000 tonnes has not yet been set, but is expected to average in excess of USD 100 per tonne. The agreement also allows for the advance drawdown of up to USD 10 million by Quinsam, with interest at LIBOR + 2%.

Mr David Slater president & CEO of Hillsborough Resources said that "I am delighted to be able to announce this agreement. Vitol have proven to be excellent partners and we are certainly impressed with their excellent understanding of the dynamics of the thermal coal market. We are looking forward to a long and mutually fruitful association."

Hillsborough Resources Limited is a coal mining company that operates the Quinsam underground thermal coal mine near Campbell River, British Columbia, which serves the local and west coast US cement industry and is increasing export sales. The Company is a limited partner in the Peace River Coal Limited Partnership, which has substantial metallurgical coal properties both in production and under development near Tumbler Ridge, British Columbia.

Bulgarian l production in 2007 up by 110%

The Bulgarian Chamber of Mining and Geology said that the closure of two units of Bulgaria's Kozloduy nuclear power station led to a pick up in demand from local power stations and a 110% increase in domestic coal production to 28.4 million tonnes in 2007.

The Maritsa Iztok mining company alone produced 24 million tonnes. The thermal power plants buy 97% of the locally mined coal; the rest is sold to households.

All 17 of the nation's coal mining businesses averaged higher output in 2007.

Quest receives purchase coal supply order

Kentucky based operator of energy and mineral related properties Quest Minerals & Mining Corp announced that its wholly owned subsidiary Gwenco Inc has received a large purchase order for up to USD 8 million of coal through December 2008 from Logan & Kanawha Co LLC a West Virginia company.

Mr Eugene Chiaramonte president of Quest said that "We are excited and optimistic about resuming our coal production during April. This purchase order is a very significant order for us, and we fully anticipate being able to fulfill the entire order during the course of 2008. We expect to announce initial progress reports on operations next quarter. This purchase order confirms that, with an inherent sulfur reading below 0.6% and over 13,000 BTUs, our Pond Creek coal remains in high market demand."

Quest Minerals & Mining Corp acquires and operates energy and mineral related properties in the southeastern part of the United States. Quest focuses its efforts on properties that produce quality compliance blend coal.

Alcoa launches new website on aluminum can recycling

Alcoa announced that it has launched a new corporate recycling website detailing how aluminum recycling is part of the clean air solution.

Alcoa said that the website, www.alcoa.com/recycling, explains why it’s important to recycle and how recycling helps the environment and the economy. A video explains how the ultimate recyclable package the aluminum beverage can is recycled and brought back to the grocery shelf in 60 days or less as a brand new soda can. Recycled aluminum requires 95% less energy to produce and can be recycled many times, reducing carbon dioxide emissions.

The website also provides tools to find recycling centers for consumers and businesses, links to recycling organizations, information on how to become an Alcoa approved recycler, fun facts, an interactive recycling blog, and a selection of YouTube videos from recycling enthusiasts.

Alcoa pioneered the recycling of aluminum 30 years ago when it formed Alcoa Recycling Company, when the popularity of aluminum cans began to explode. Today, the US recycling rate is among the lowest in the world, even though Americans are the biggest users of aluminum beverage cans.

Mr Greg Wittbecker director of Alcoa Metal Recycling Strategy said that “At that time and today our mission is the same to help the public understand the importance of recycling. But today recycling is even more critical, because recycling aluminum is a key element to slow and stop the growth of greenhouse gases caused by power generation. Recycling aluminum is the smart choice.”

Aleris appoints Mr Baan head of European operations

Aleris International, Inc announced that Mr Roeland Baan will join Aleris as executive vice president & president of Aleris Europe. He will report to Mr Steven J Demetriou chairman & CEO of Aleris on April 7th 2008.

In this role, Mr Baan will be responsible for all business and operational activities in Aleris's European region as well as its European headquarters.

Mr Demetriou said that “Mr Roeland brings diverse career experiences involving a wide range of operations and challenges. He has a proven track record of delivering improved results and integrating multinational organizations and we believe will be able to make an immediate contribution to our European business.”

Aleris International, Inc is a global leader in aluminum rolled products and extrusions, aluminum recycling and specification alloy production. It operates 48 production facilities in North America, Europe, South America and Asia and employs approximately 8,800 employees.

Westmoreland Coal announces management changes

Westmoreland Coal Company announced the following management changes:

1. Mr Kevin A Paprzycki has been named CFO replacing Mr David J Blair who is leaving the Company. He has served as the Company’s Controller and Principle Accounting Officer since June 2006.
2. Mr Douglas P Kathol has been named treasurer and will assume that role in addition to his duties as vice president, development. He joined the Company in August 2003.
3. Ms Mary A Hauck has joined the Company as vice president, human resources.
4. Mr Russ H Werner has been named director of accounting.
5. Mr Bruno J LaCrampe has been named director of internal controls.

Westmoreland Coal Company is the oldest independent coal company in the United States and a developer of highly clean and efficient independent power projects. The Company’s coal operations include coal mining in the Powder River Basin in Montana and lignite mining operations in Montana, North Dakota and Texas. Its current power operations include ownership and operation of the two-unit ROVA coal-fired power plant in North Carolina and an interest in a natural gas-fired power plant in Colorado.

Pakistani steel sector to use 40% domestic iron ore

According to a meeting of Engineering Development Board’s committee on competitiveness & efficiency improvement in steel sector, chaired by committee chairman Mr Tawfiq H Chinoy, Pakistan’s steel industry would be using 40% local iron ore by 2010 as the manufacturers have already taken steps towards this direction.

The committee finalized its recommendations, to be incorporated in the budget 2008-09, for the promotion of steel sector. The recommendations would be forwarded to Federal Board of Revenue for final approval. The committee agreed that the incentives would be linked with the improvement of efficiency, especially in the energy sector.

The committee members were unanimous in opining that the survival of steel sector lied in the development of local inputs especially iron ore deposit. The committee also underlined the need for controlling the rising price trend but felt helplessness due to international market trends.

It may be recalled that EDB had formed 20 sectoral committees for suggesting tariff structure in the forthcoming budget 2008-09. Each committee comprised of manufacturers and experts as members and is headed by experienced industrialist or expert as its convener.

Turkish steel exports surge by 45% YoY

According to a March export figures released by Turkish Exporters Assembly, Turkish exports hit USD 10.95 billion in March 2008 up by 22.8% YoY over March 2007. Turkish exports in the first quarter of 2008 increased by 36.2% YoY to USD 31.4 billion over the same period of 2007. As of the end of March 2008, YoY exports had grown by 26.6% hitting USD 114.3 billion.

Iron and steel exports saw the second highest rise with 44.56%.

By revenue generated, the highest export numbers came from the industrial sector making USD 9.7 billion. Agriculture exports hit USD 1.07 billion, while metal and mineral exports totaled USD 220,282. In terms of export destinations, Germany took the first spot, followed by Italy, UK, Russian Federation, France, Spain, US, Romania, the Netherlands and UAE.

Mr Oğuz Satıcı president of Turkish Exporters Assembly said that recent political developments had forced Turkey away from being a state of law with all institutions operating in harmony. He added that "And unfortunately this causes a perception that Turkey has lost its way. Our aim is to establish welfare and democracy at the same time."

Mr Kürşad Tüzmen Turkish foreign trade minister said that Turkey’s exports for the past 3 months were equal in value to all export revenue in 2001. He also emphasized that Turkish exporters had increased their exports despite negative developments in world markets. Mr Tüzmen said that Turkish exporters followed global developments closely and were taking measures to turn threats into opportunities. He added that the Foreign Trade Under secretariat, TİM, exporters’ unions, Exim bank and the Export Promotion Center were working in harmony.

Abu Dhabi customs officials deny allegations

Zawya.com reported that Abu Dhabi Customs Department has refuted the allegation by steel and cement traders in Abu Dhabi that the Abu Dhabi customs department is violating the decision of Mr Sheikh Mohammed bin Rashid Al Maktoum VP and also prime minister of UAE and Ruler of Dubai, to exempt cement and steel from the 5% customs duties.

Mr Saeed Al Muhairi director general of Abu Dhabi Customs Department said that his department has complied with the exemption decision ever since it was issued on March 16th 2008.

He said certain section of traders was using Mr Sheikh Mohammed’s decision to demand exemption for shipments that had entered Abu Dhabi four months ago. He added that "Unfortunately, traders are not satisfied with the big profits they made when the prices were high and want more profits at the expense of consumers and the future of the emirate. Even now, some are making big efforts to starve the market of cement and steel in an effort to raise their prices."

He added that there is a huge demand in the market for cement and steel to meet the needs of real estate projects, especially those launched by Aldar Properties, Sorouh, Abu Dhabi Commercial Bank and Abu Dhabi Islamic Bank.

The complaint comes at a time when the price of cement and steel in Abu Dhabi has risen considerably. A tonne of cement was selling for AED 4,200 as compared to AED 3,780 2 weeks ago. The price of a bag of cement ranged from AED 28 to AED 30, up from AED 24.

AED 20 billion road projects under way in Abu Dhabi

Emirates Business 24/7 reported that road projects worth AED 20 billion are under way in Abu Dhabi, marking a significant upgrade to the emirate’s infrastructure to keep ahead of the rapid growth in population.

Mr Juma Mubarak Al Junaibi director general of Abu Dhabi Municipality said that the new projects are focused on facilitating traffic flow on main arteries into and out of the capital, such as Al Salam Street and Airport Road. He added that the largest single project in terms of cost will transform Al Salam Street. The AED 3 billion to AED 5 billion undertaking is made up of 4 separate construction contracts and will take 3 years to complete.

Mr Al Junaibi said that a tunnel will be built, comprising 4 lanes in each direction, to allow non stop traffic movement along the route. The tunnel starts from Al Mina Street, goes under Al Salam Street and finishes after the junction of Al Salam Street and Al Falah Street. The tunnel will be able to accommodate 6,000 vehicles per hour. The contract also includes the construction of additional local roads from Al Salam Street to neighboring areas as well as the construction of other tunnels linking Corniche Street with Al Salam Street.

He said that once the project is completed, residents will be able to travel the length of Al Salam Street without the need to stop at traffic lights. The second giant project topping Abu Dhabi’s infrastructure development plan is along Corniche Street. The first phase of this project, which has already been completed, included the construction of the new Corniche East Street and the expansion of the old road. Three tunnels were also built to facilitate traffic movement at main junctions.

Mr Abdullah Saeed Al Shamsi director of roads & infrastructure at Abu Dhabi Municipality said that the infrastructure plan includes more roads within the capital and carries a hefty price tag. He added that "The final cost of under construction roads goes up to AED 20 billion. The figure could rise even more as the prices of building materials increase."

Mr Al Shamsi said that the largest construction project on an external road would take place on Abu Dhabi Al Guwaifat Street. The four phase retrofit is expected to cost more than AED 4 billion. The municipality has also started work on Al Mafraq Road and Bridge with a total cost of AED 725 million. It will be completed in 24 months.

Depa wins USD 102 million deal from Dubai metro

Dubai based interiors contracting company Depa Limited has announced that it won an AED 375 million contract to fit out metro stations in Dubai.

Lindner Depa Interiors, a JV with Germany's Lindner Group which Depa controls, will fit out 13 stations on one of two urban railway lines being built. The contract is for the Red Line, which will open in 2009.

Depa aims to raise at least USD 400 million in an initial public offering in May 2008 to finance expansion and acquisitions and will list its stock on exchanges in Dubai and London.

Voltas wins AED 260 million cooling plant contract in Dubai

Trade Arabia News Service reported that Emirates Central Cooling Systems Corporation has awarded an AED 260 million contract to TATA Group’s Voltas for the construction of a cooling plant at the Dubai International Financial Centre. Mr Ahmad Bin Shafar CEO of Emirates Central Cooling Systems Corporation and Mr Shaukat Ali Mir regional director and deputy COO of Voltas has signed the deal.

Under the contract, Voltas will complete civil, mechanical, electrical and plumbing works in addition to the construction of the 66,000 refrigeration tonne district cooling plant. The project will provide the financial centre with green and environment friendly district cooling that will effect substantial savings in energy consumption. The project is expected to be completed in 15 months.

Mr Bin Shafar said that "Voltas was chosen for its successful track record in implementing massive projects. As one of the major engineering solutions providers for a wide spectrum of industries such as heating, ventilation and air conditioning, Voltas brings substantial expertise to our project deliverables."

Spread over 110 acres, the Dubai International Financial Centre is the world’s fastest growing international financial centre, being developed on the lines of other global centers such as in New York, London and Hong Kong.

Iran Khodro to set up auto assembly plant in Algeria

IRNA reported that Iran's auto manufacturing giant Iran Khodro Company is planning to establish an auto assembly plant in Algeria in near future.

Mr Hakim Ekini advisor to Algeria's Famoval Company said that everything is ready for establishment of Iran Khodro Company assembly plant. He added that "Some 1,000 vehicles of various types have been sold here and automobiles are being distributed officially by 10 representative offices in the cities of Algiers, Vihren, Constantine and Annaba."

Mr Ekini announced that the number of distribution centers will double in near future and be extended to other Algerian provinces. He added that "The after sale services and auto parts have completely satisfied customers."

OPEC to hold informal meeting in Rome in April

Organization of Petroleum Exporting Countries will hold an informal meeting on the sidelines of an oil producer consumer conference in Rome later in April 2008 to discuss whether current oil market developments warrant calling a special session to consider adjusting output.

OPEC governor said that "A meeting is planned. They will informally discuss developments in the oil market and see whether it is necessary to hold an extraordinary meeting." The head of Libyan oil policy Mr Shokri Ghanem told Mr Dow Jones that the meeting is yet to be confirmed but was being discussed.

OPEC ministers, when they last met in Vienna in early March 2008, decided to keep production unchanged and meet in September 2008 but agreed to talk again unofficially at the International Energy Forum, which is scheduled for April 20th to April 22nd 2008 in Rome.

Turkey asks Kuwait help for building refinery

Kuwaiti news agency Kuna quoted Mr Mohammad al Olaim acting oil minister of Kuwait as saying that Turkey has asked Kuwait to participate in building a new oil refinery in Turkey. As per report, Turkey also wanted OPEC member Kuwait to invest in crude storage facilities.

Mr Olaim said that Kuwait would make a decision about these projects after having carried out a feasibility study. He added that Kuwait is considering using the Turkish port of Ceyhan to store Kuwaiti crude as a gateway to Europe.

Kuwait gave the nod last week to take a stake in building a new USD 6 billion refinery in Vietnam and is also in talks to take a role in new plants in China and India.

Iran Khodro to increase production capacity to 600,000 cars

IRNA reported that Iran's auto manufacturing giant Iran Khodro Company is planning to increase its production capacity to 600,000 cars in the current Iranian year beginning on March 20th 2008.

Mr Manouchehr Manteqi MD of IKCO said that some 520,000 cars will be manufactured in Tehran site, 100,000 in Khorasan, 30,000 in Tabriz and over 20,000 cars will be produced in IKCO sites located abroad.

Mr Manteqi also noted that the first hybrid bus will be delivered on October 2008. He cited the completion of the second phase of Khorasan plant with the capacity of 150,000 cars, completion of second phase of Syria plant with the capacity of 30,000 cars, increasing the capacity of Belarus site, establishing the second production line of low fuel consumption vehicles, establishing the second phase of Iran Khodro plant in Tabriz and establishing subway equipment production line in Abhar as the most important schemes of the IKCO for the current year.

Referring to the performance of IKCO during the previous year, Mr Manteqi put the value of IKCO exports at USD 575 million, showing an 83% increase compared to the same period last year. He said "After 3 years of non stop efforts, IKCO managed to export Samand to Turkey in 2007, which indicated that Iran has met the European standards."

Pakistan asks Sindh to review agreements with power firms

Daily Times reported that Pakistan’s new federal government has asked Sindh Mines & Mineral Department to review all the agreements of interested coal based power producing companies including the core issue of upfront tariff as soon as possible.

Sources in the Sindh Mines & Mineral Department said that the federal government is seeking the detail reports of existing status of the company’s development activities, negotiations and profiles. They said that the new government has asked all the concerned departments and authorities for coal based power development to point out all pending issues of interested companies so that could be resolve at the earliest.

Besides, several leaders of Pakistan Peoples Party have also said that they will change the existing policy for coal based power generation so that the widening deficit of energy could be reduced in future. The interim Sindh government has already asked foreign and domestic coal based power generating companies to start its drilling and exploration works in their respective allotted areas.

Out of 6 various companies that inked MoU with concern authorities, there are 2 companies who have started drilling work in their respective areas.

1. China National Machinery Import and Export Corporation has conducted its operations at Sonda Jherruk, Thatta and proposed 10 cents per unit to generate electricity.
2. Oracle Coal Field has commenced drilling the first borehole of a 7 hole program on Block VI of the Thar Coalfield.

AES Oasis Limited has signed MoU for establishment of 1000 MW coal fired power plant at Thar in pursuance of Bankable Feasibility Study of Thar Coal Mining. Ukrinterenergo of Ukraine has also inked MoU for coal washing plant of 1 million tonnes coal annually. Dadabhoy for establishment of 200 MW coal fired power plant at Sonda Jherruck in district Thatta. Al Abbas Group has also inked MoU with Sindh government.

China to have over capacity of H beams in 2008

It is reported that Mr Zhang Shengsheng deputy GM of China's biggest sections maker Laiwu Steel Group China's H-beam while speaking at the MB Minmetals' 6th Far East Steel & China Iron Ore Conference in Beijing said that market may face oversupply later this year. As per report, the projected output in 2008 is about 10.3 million tonnes up by 48.6% YoY.

He said that “There will be a lot of new H beam capacity starting operations this year. Although market demand will also increase stably, oversupply may emerge later this year.”

Much of the new capacity will come from private mill Hebei Jinxi Iron & Steel, which is set to take over as China's largest H-beam producer after its 1.2 million tonnes per year mill starts up at the end of the month, taking its H-beam capacity to 2.7 million tonnes per year. Tangshan Lixing Steel Co commissioning a 500,000 tonnes per year H-beam mill last month.

Chinese H Beam output in 2007 was 6.93 million tonnes in 2007 up by 38.3% YoY as compared to 5.01 million tonnes in 2006. The main producers of H Beams in China during 2007 include
1. Laiwu Steel - 2.2 million tonnes
2. Ma An Shan - 1.8 million tonnes
3. Rizhao Steel - 1.4 million tonnes
4. Jinxi Steel - 1.3 million tonnes.

Iron ore price negotiations – Chinese threaten revenge

The Australian Financial Review reported that Chinese steel makers has confirmed boycotting some Australian iron ore imports and has also warned that Australia is jeopardizing billions of dollars in iron ore sales by pushing for large contract price rises,

Mr Chen Xianwen deputy director general of the China Iron and Steel Association told the newspaper in an interview in Beijing that “Australia could face revenge for the aggressive pursuit of higher prices by iron ore miners BHP Billiton Ltd and Rio Tinto Ltd.”

Mr Chen said that Chinese steel mills that are boycotting Australian iron ore in the spot market were angry at moves by Rio Tinto to divert some of its contracted sales into the more lucrative spot market. He said that "Buyers and sellers should not be hostile - they should be interdependent.”

Chinese plan for shutting down steel plants during Olympic Games

It is reported that China which plans to shut down factories in Beijing during the Olympic Games will also target other big time polluters in the neighboring municipality Tianjin as well as the provinces of Hebei, Inner Mongolia, Shanxi and Shandong.

The shutdown will begins on July 17th 2008 and will continue till September 20th 2008.

In addition to that, Beijing city also plans to shut down construction sites to help improve air quality during the Olympic Games.

The official website of the Olympic Games reported that Mr Zhou Shengxian head of the State Environmental Protection Administration will close several coal fired power plants as well as steel mills and cement plants, to cut emissions of the acid rain causing pollutant.

As per report, more than 10 factories in Beijing and Hebei scheduled for closure over the next two years will now be already are shut down before June.

BHPB bid for Rio – Difficult for Chinalco to block the Bid

A Chinese media quoted Mr Marius Kloppers CEO of BHP Billiton as saying that it would be difficult for Aluminum Corp of China to block the miner's takeover bid for its rival Rio Tinto Ltd.

In an interview with Chinese reporters in Melbourne, Mr Kloppers said that the 9% stake taken by Chinalco and Alcoa Inc would not hinder BHP's takeover plans. He said that "We hope to acquire 100% of Rio Tinto's shares, but our minimum offer is for a 50.1% stake. Therefore it will be difficult for a shareholder with a 9% stake to stop the deal."

Mr Kloppers dismissed claims by Mr Tom Albanese CEO of Rio Tinto that Rio Tinto is outperforming its predator. He said that "His claim that Rio Tinto's performance is 45% better than ours is unjustified.”

He added that "BHP Billiton has increased its offer, and Rio Tinto's shareholders should give this consideration."

Chinese iron ore import growth to slow down in 2008

It is reported that China, the world's largest consumer of iron ore, may slow the pace of imports this year because of record prices and as the government reins in lending and real estate expansion.

Mr Zou Jian head of the China Metallurgical Mining Enterprise Association said at a conference in Beijing, said that imports may rise 14% to 435 million tonnes this year, which is slower than the 17% gain last year. Mr Zou had forecast in April 2007 that Chinese iron ore imports in 2007would grow by 20% YoY.

Mr Zou said “In some regions in China, we are starting to see slight falls in spot iron ore prices, and it may be a sign that higher prices are deterring purchases. The government may introduce more measures to control investment and tighten lending' which will hurt steel demand.”

He said global iron ore supply could exceed demand by 10 million tonnes this year. He did not give details on the falling cash prices of iron ore sold in China.”

He added that steel production may rise 8.4%in 2008 to 530 million tonnes and prices will fall in the second half of the year after gains in the first six months.

Chinese coal prices drop as energy crunch eases

According to China National Coal Association, Coal prices in China have started to decline as the nationwide energy crisis triggered by wild February snowstorms starts to ease.

China Central Television Station reported recently that coal production across China has been restored from 4 million tonnes to the previous level of about 5 million tonnes per day, while the country's coal consumption decreased by 300,000 tonnes each day due to warmer weather. Stockpiles of coal at power plants across the country are sufficient to meet demand for up to 15 days.

The report said the association also expected that China's coal production will rise by more than 200 million tonnes this year which is just enough to cover a demand growth in industrial sectors such as electricity, construction materials and iron and steel production.

POSCO eying stakes in Chinese steel makers - Report

Reuters reported that POSCO is considering buying a stake in a Chinese steel maker to expand its presence in the world largest but most fragmented steel market.

The report cited POSCO as saying that "We are closely monitoring progress in China's steel industry shakeout and possible changes in the Chinese government's policy on foreign investment with a view to buy a stake in a Chinese steel company."

POSCO, the world's fourth largest steel maker by output, already operates BX Steel POSCO Cold Rolled Sheet in China a joint venture set up with Benxi Iron and Steel in 2003 and said in January it would spend USD 2.5 million to form a car parts plant in China.

Laiwu new plate mill project to come on line in 208

It is reported that China’s Laiwu Iron & Steel is going on new project to add a new plate mill with 1.5 million tonnes per year capacity aiming to commission end this year or no later than early next year, for which construction was started last year.

As per report the new plate mill will be focused on wide and heavy plate in thickness range of 6mm to 500mm in maximum width of 4,000mm. The mill will produce high end grades including API X80.

Auto steel demand in China to see sizeable growth

Mr Yao Jie deputy secretary general of China Association of Automobile Manufactures while speaking at the Far East steel conference said that China's demand for automobile steel may come up to 13.71 million tonnes in 2008.

He said that the demand would reach 15.1 million tonnes in 2009, 16.37 million tonnes in 2010, 21.76 million tonnes in 2015 and 27.67 million tonnes in 2020 nearly doubling the figure this year.

Mr Yao made the forecast based on the automobile production and number of retained vehicles by the social communities 2008-2020, automobile steels' composition and ratio of localization etc.

Mr Yao said as seen from composition of the auto vehicle, 50% to 60% of it is made of steel and 12% to 15% from cast iron. This year, output of auto vehicles is to reach 10 million up by 12.61% YoY including 7.3 million passenger vehicles and 2.7 million commercial vehicles, growing 14.42% and 8% respectively.

Haier ties up with Baosteel

It is reported that Chinese white goods major Haier Group has tied up with five suppliers including Baosteel Group recently, forming the first air conditioner quality alliance in the country. Besides Baosteel, Haier's cooperators include Japan's Mitsubishi Electric, NEC, Finland's LUVATA and US Honeywell.

Haier said that the move is aimed to strengthen raw material quality and forge stable supply chain.

Mr Fan Zengnian director of air conditioner department revealed that the cooperation between Haier and Baosteel began in 1999 and said that its purchase volume would increase this year on account of swelling production scale.

Shipbuilding steel demand in China predicted to grow

According to Mr Zhang Jiaguo chief analyst with the economic research center of China Shipbuilding Industry Corporation, China's demand for shipbuilding steel would come to 41.52 million tonnes during 2006 to 2010, 8.3 million tonnes on average annually and during 2011 to 2015 and the figure will total 51.41 million tonnes or 10.28 million tonne annually.

In China, a host of steelmakers expanded shipbuilding steel capacity from 2003, increasing the output from 3.68 million tonnes in 2004 to 6.54 million tonnes in 2006 presenting a higher growth than the ship completion. Home production basically met demand and the export also grew but for certain higher grade varieties, such as high strength ship plate, anisotropic plate, extra wide, long or thin plate and T-shape plate etc, the supply is far from enough.

In the next few years, a batch of medium plate rolling mills will be built in China, hopefully to improve quality and diversify breed of the homemade shipbuilding steel and gradually satisfy demand from shipbuilding industries.

Tangshan closes last obsolete wire rod production line

It is reported that Tangshan Steel has weeded out its last common wire rod mill. It is reported that No.3 rolling production line in No.2 rolling mill in Tangshan Iron & Steel Co formally stopped the production recently.

As per report the production line has served the steelmaker for nearly 50 years, mainly yielding 8mm to 10mm common carbon wire rod.

The line produced 490,000 tonnes of wire in 2007 and has cumulatively produced 7.49 million tonnes of wire billets in 49 years. Due to outdated technology, however, the line cannot meet the demand for the development of iron and steel industry.

Pansteel invests CNY1.4billion in pyrite mine in Yibin

Panzhihua Iron & Steel Co signed strategic cooperation agreement with the government in Xingwen Town, the city of Yibin and Sichuan Jinwei Group Corporation recently.

According to the agreement, Pansteel will exploit pyrite mine project in Wenxing Town by two phases. In the first phase, they will install selecting equipment with a capacity of 1 million tonnes per year in order to produce 300,000 tonnes of high grade pyrite concentrate. In the second phase, they plan to construct a selecting project with a capacity of over 1 million tonnes per year and suppose to build vitriol mill according to local market, in order to extend industrial chain.

Mineral resources are abundant in Wenxing Town in the city of Yibin and there are 25 varieties of minerals. A pyrite reserve is as high as 910 million tons. It is predicted that potential economic value of mineral resources there is over CNY 80 billion.

Chinese mineral survey plan to be launched soon

It is reported that Chinese government’s plan for implementing a survey on exploitation of mineral resources in 30 provinces, autonomous regions and municipalities has passed examination of experts and now the exploration work will soon spread nationwide in China.

As per report the survey will be an investigation into the national conditions in mineral resources sector, focusing on 28 kinds of minerals including oil, natural gas, coal, uranium, steel, copper, aluminum, potassium and phosphorus. It aims to obtain concrete data on the quantity, structure, grade, layout and exploitation of various mineral reserves.

Experts hold that the work will help China take stock of its mineral reserve, enliven the stock and ensure sustained and stable supply. Through the survey, China may renew its mineral resources reserve data and provide a basic prop up to the country's economic construction and macro policy making.

Jinxi Steel develops X 52 grade

It is reported that on March 28th 2008, Jinxi Steel successfully produced API 5L PSL1 X52 oil pipeline steel, filling the blank of smelting and rolling API grades in Jinxi Steel.

It produced 200 tones of X52 grade steel and inspection and testing reveled compliance to API X52 grade

According to its product development plan for 2008, its technology center, quality inspection center, steelmaking plant, rolling mill closely cooperated with each other.

Chinese ferroalloy exports in February 2008

According to the recently released information by Chinese custom authorities, Chinese ferroalloy export during February 2008 amounted to 197,136 tonnes.

In tonnes

China to discover 20 new gas and oil big fields by 2010

It is reported that China seeks for domestic oil and mineral reserves of key resources, such as iron ore and crude oil, to reduce dependence on imports.

According to the government's plan, by 2010 China intends to find 10 new oil fields of at least 100 million tonnes reserve each and 8 to 10 new gas fields, each with a reserve of more than 100 billion cubic meter of natural gas. Furthermore, by the same year it is planned to find about 200 large mines with coal, iron and copper.

Mr Ju Jianhua head of the Ministry of Land and Resources said "The plan is of strategic importance to China, which is becoming increasingly dependent on imports."

China is the world's second largest crude oil importer.

Chinese coal firm Dynamic Energy to boost capacity

Reuters reported that Chinese coal producer Dynamic Energy Holdings Ltd plans to set aside CNY 2 billion to buy mines and more than quadruple its annual coal production capacity to 6 million tonnes by 2011.

Mr Bao Hongkai chairman of Dynamic Energy Holdings Ltd said Dynamic Energy, based in the central province of Henan plans longer term to boost its capacity to 10 million tonnes in five years. He said that the firm plans to boost its coal reserves to 100 million tonnes by 2011 and 200 million tonnes in five years.

Chinese coal consumption has roared in past years alongside economic growth, propelling ex mine prices for the hydrocarbon to record highs in 2008 and spurring a raft of capacity expansion plans at the likes of Shenhua and China Coal 1898.HK.

Dynamic, formerly a power generating firm known as Everbest Energy, had decided to pool its assets and resources in thermal coal mining instead.

Chinese common carbon slab imports in February 2008

According to the recently released information by Chinese custom authorities, Chinese common carbon slab imports during February 2008 amounted to 632 tonnes.

In tonnes

Dong Ling and Yuguang to start production of Zinc in August

Reuters reported that China's Dong Ling Group will start production at an 80,000 tonne a year zinc facility in July to August which will boost capacity to about 250,000 tonnes a year.

Company official said Yuguang Gold and Lead, China's top lead producer will also begin production at a new 100,000 tonne zinc facility in August to September.

A trade manager at Dong Ling said the firm also wanted to build two more 100,000 tonne zinc facilities in Shaanxi province as part of a plan to boost zinc capacity to 500,000 tonnes a year in 2012. He said "We still have two more 100,000 tonne projects. We will focus on zinc in the future."

The Dong Ling trade manager said the firm was optimistic about growth in domestic zinc consumption, as infrastructure development would boost steel production in China, the world's top steel producer. He said Dong Ling is expanding its investment in lead and zinc mining in Xinjiang and Tibet and hopes to produce 300,000 tonnes of lead and zinc in ore in 2012.

The manager said the firm is operating 200,000 tonnes of lead and zinc capacity of which 20,000 to 30,000 tonnes is lead. It has no plan to expand its lead capacity. He said Dong Ling will produce 230,000 tonnes of refined lead and zinc this year of which 20,000 to 30,000 tonnes will be lead. It produced nearly 170,000 tonnes of lead and zinc last year.

An official at Yuguang Gold and Lead Co said the listed firm's parent would start up 100,000 tonnes of new capacity at its zinc plant in August to September, which would double plant's capacity.

Chinese ferroalloy price up last week

It is reported that the price of ferroalloy in China was affected by imported iron ore's price to hike strongly in last week. But other materials like FeMo and FeVa was experiencing a downward spiral.

As per report last week the price of FeSi increased. By Friday, 75#FeSi was at CNY 6,600 per tonne to CNY 6,700 per tonne and 72# FeSi was at CNY 6,500 per tonne. In addition, the offer for export was at USD 1,400 per tonne to USD 1,450 per tonne.

The reasons for hiking of FeSi are including cost rising and tight supply. It is expected that the price of FeSi will go on rising this week.

(Sourced from YIEH.com)

China to find 200 large coal, iron and copper mines by 2010

Platts reported that China in a bid to reduce its growing dependence on imports of mineral resources aims to find about 200 large mines, with coal, iron and copper. The report added that the plan is drafted by the Ministry of Land and Resources.

China Daily quoted Mr Ju Jianhua deputy head of the ministry's planning department as saying that "The plan is of strategic importance to China, which is becoming increasingly dependent on imports.

He added that "As a result of a slowdown in geological surveying since the 1980s, when China was moving towards a market oriented economy, we are now facing the prospect that by 2020, domestic supplies of nearly 20 kinds of minerals could be insufficient to meet demand."

China is the world's largest importer of iron and copper ores. It depends on imports for roughly 50% of its copper production.

Mr Owens visits Caterpillar facility in China

It is reported that Mr Jim Owens chairman & CEO of Caterpillar Inc visited Caterpillar's newest prime product manufacturing facility in China, Caterpillar Paving Products Limited, during his most recent visit to Asia.

The CPPX facility produces Asphalt Compactors, Cold Planers and Soil Compactors. This facility is an essential part of Caterpillar's global strategy to competitively manufacture products in all regions of the world for Caterpillar customers.

Mr Owens said "We are continuing to make significant new investments in China to provide our customers here with the world's best products and services. He said the paving facility is one of many examples of our commitment to this market."

Mr Mike Baunton Vice President of Caterpillar with responsibility for the Global Paving business said "This facility joins our other paving product plants, which are strategically located in the Americas and Europe. It is the centerpiece of our growing paving business in the Asia Pacific region and will ensure Caterpillar's ability to suppor