Refractory brick laying inaugurated at SAIL RSP

BS reported that refractory brick laying of the coke ovens battery number 4 was inaugurated by Mr BN Singh MD of SAIL Rourkela Steel Plant.

With the objective of setting up an environment friendly, the contract for rebuilding battery number 4 was awarded to a Ranchi based company at a cost of INR 142.6 crore. The entire project will be implemented in a schedule time of 24 months. After commissioning of this battery, more than 1,000 tonnes additional hard coke will be available per day to meet the requirements of the blast furnaces to maintain the required production level of hot metal.

Also the coke oven gas available will supplement the energy balance of the plant. It will also facilitate taking up planned repair of other existing batteries without affecting the productivity of the blast furnace.

The environmental control feature of the battery will ensure the pollution free charging of coal into the oven. The chimney height from existing 90 meters to 95 meters will ensure a better combustion and effective evacuation of waste gas.

Export duty on steel hits supplies to SEZs – Report

FE reported that the government's move to impose export duty on certain steel products to rein in inflation has put itself in a fix as the decision is now affecting supplies of steel to special economic zones, where there is a huge demand for it.

Sales from domestic tariff area to SEZs are treated as deemed exports. Domestic tariff area is the area within the country where normal tariffs apply. This does not include SEZs, which is deemed as foreign territory for tax purposes and are therefore tax free enclaves. Imposition of export duty on such steel products has made these items costlier in SEZs.

On May 10th 2008, the finance ministry had issued a notification regarding the imposition of 5% to 15% export duty on semi finished and finished steel products.

A senior commerce ministry official said that "We have sought a clarification from the law ministry in the matter. Also, a reference has been made to the finance ministry. The commerce ministry has demanded that the export duty be exempted for sale of steel products for 'consumption within the SEZs."

In a similar instance, Mr Kamal Nath union commerce & industry minister had given some relief to the cement sector saying that export ban on cement will not apply to sale of cement from DTA to SEZs. These tax free zones, under various stages of becoming operational, are witnessing massive construction activity that needs huge quantity of cement and steel. Besides, SEZ units manufacturing items including auto-components and engineering products also use steel products.

The commerce ministry and Export Promotion Council have received several queries from SEZ units and developers on the issue of export duty on steel products for export oriented units and SEZs.

Mr LB Singhal director general of Export Promotion Council said that the SEZ rules define export as goods exported out of the country, supply of goods from DTA to SEZ and supply of goods from one SEZ to another. He added that since the finance ministry's notification is applicable only to goods exported out of the country, it should issue a clarification or carry out an amendment to that extent.

In the case of cement exports, the directorate general of foreign trade had subsequently carried out an amendment saying the prohibition of cement export is not applicable to supply of cement to SEZs for consumption within SEZs.

Meanwhile, the steel industry is lobbying the government hard to withdraw the export duty, arguing that they have already helped calm inflationary impact of rising steel prices by cutting their prices by INR 2,000 to INR 4,000 per tonne.

PSL Limited secures orders worth INR 1,225 crore

BL reported that pipe manufacturing company PSL Limited has bagged 2 orders worth INR 1,225 crore from HPCL Mittal Pipelines Limited and Larsen & Toubro.

PSL Limited said that HPCL Mittal Pipelines Limited had placed an order for its entire requirement of steel pipes valued at INR 917 crore for the Mundra Bhatinda crude carrying line for the Bhatinda Refinery. The order would be executed this fiscal

L&T has placed an order for full steel pipe requirement, including coating, for its 220 kilometers long Barmer water pipeline. The order is to be executed at PSL’s Phagi pipe manufacturing facility near Jaipur.

Mr Ashok Punj MD of PSL Limited said that "These deals redefine our position in the market and we expect to complete these projects ahead of schedule."

Notice for acquiring land near Nandigram spark protests

ET reported that West Bengal government has issued a notice for acquiring nearly 500 acres of agricultural land at Geonkhali near Nandigram for setting up a ship building yard and downstream units, sparking protest by villagers.

The notice, issued by the district magistrate Mr Anup Agarwal, said that a total of 493 acres would be acquired for setting up a ship building factory. The notification for the shipyard, to be built by the Bharti group in collaboration with the Appejay group, came immediately after the panchayat polls.

It may be noted that at least 150 villagers under the banner of Bhumi Raksha Committee, floated by the Congress, demonstrated today before the panchayat office protesting against the move. They also took out processions yesterday led by a local Congress leader Mr Suman Batabyal. He said that "We will never allow fertile land to be acquired by building promoters under any circumstance."

Maruti hikes prices up to INR 15,000 on rising input costs

BS reported that Maruti Udyog Limited has raised the prices of its vehicles by as much as INR 15,000 to offset the rising input costs. It raised the prices between INR 1,000 on the Zen Estilo and Wagon R hatchbacks to INR 15,000 on the diesel variant of its Swift model.

It may be noted that prices of steel have risen both globally and locally, forcing automobile makers such as Maruti and Honda Siel Cars to raise prices. Maruti's price increase comes amid prospects of a slow down in sales because of rising interest rates. Maruti also withdrew the special introductory price on the newly launched Swift DZire model.

Mr Shinzo Nakanishi MD of Maruti said in April 2008 that it was negotiating with steel companies on new contracts and faced a price increase up to 40%. Maruti had cut the prices of some models in February end 2008 after the government reduced the excise duty on small cars to 12% from 16%.

Meanwhile, Mahindra & Mahindra raised the prices of its vehicles by up to 2.5% last week.

Centre lines up INR 5,000 crore port expansion projects

BL reported that union ministry of shipping is launching 10 major expansion projects in 2008-09 at an estimated investment of INR 5,000 crore. About 60% of this investment will be for the Chennai mega container terminal, expected to cost around INR 3,100 crore.

Expansion projects are being taken up at 8 major ports namely Paradip, Vizag, Chennai, Tuticorin, Cochin, New Mangalore, Goa and Kandla in 2008-09. The sudden deluge of projects is on account of the government’s plan to enhance port capacities significantly by 2011-12. As per the National Maritime Development Program, the objective is to raise capacity from 383.7 million tonnes to 615.7 million tonnes.

As Paradip is located close to India’s major iron ore and coal mining belt, the plan is to add 2 new deep draft berths. Separate berths are planned for both iron ore and coal shipments.

The government plans to set up a mechanized iron ore handling facility at the New Mangalore port. Shipments of iron ore and coal are expected to see a 70% rise at Indian ports between 2005 and 2012.

Two separate cargo terminals are to be developed at Vizag for liquid and bulk cargo. An international cruise terminal at Kochi, a multi purpose cargo berth at Kandla and a bulk cargo berth at Goa are also on the cards. At Tuticorin, berth number 8 will be converted into a container terminal.

The slew of projects planned for the current fiscal is in contrast with the previous years. Earlier, only 1 or 2 projects were commissioned every year. All projects in the pipeline will now be commissioned on a build operate transfer basis and will have both public and private participation.

Navratnas cannot raise funds from equity market - Report

ET reported that Navratna companies like National Thermal Power Corporation, Bharat Heavy Electric Limited, Indian Oil Corporation and Steel Authority of India Limited among others cannot raise funds by from the equity market. This is a direct fall out of the strong influence of Communist allies in the government.

Recently, union finance ministry had rejected the application of NTPC to raise INR 6,000 crore from the equity market. The ministry in a clarification said that since the present policy does not allow envisage disinvestments by government in a Navratna company, the ministry rejected the application. It added that the sale of equity involved 4.75% disinvestments of the government’s holding.

A senior merchant banker said that this would affect the future expansion program of all the large companies. But with this clarification, now it is clear that lowering of the government stake because of a public issue, where the funds raised will go to the company to expand its operation is also not allowed.

The banker said that in the case of NTPC, it would require more than INR 100,000 crore to meet the target. In the present balance sheet, NTPC cannot raise debt of the entire amount to fund the expansion program. That means it was forced to go to the finance ministry to raise risk capital, which would have increased its capacity to take loan also to fund the expansion of generating capacity.

The proposed issue would have lower the government’s stake by only 4.75% to 84.75% from the present level of 89.5%.

Tyre sector sees 10% growth in 5 years – CARE Report

According to a study by Credit Analysis & Research Limited, Indian tyre industry is expected to clock a tonnage growth of 9% to 10% over the next 5 years.

As per report, while the truck and buses tyres are set to register a compounded annual growth rate of 8%, the light commercial vehicles tyres are poised for a compounded annual growth rate of 14%.

According to the CARE study, the growth in the Indian tyre industry will be fuelled by the expansion plans of the automobile companies, government's focus on development of road infrastructure and sourcing of auto parts by the global Original Equipment Manufacturers. However, the tyre industry has to grapple with raw material price volatility, rupee appreciation and cheap Chinese imports.

The tyre industry in India recorded a compounded annual growth rate of 9.69% during 2002-07. The size of the industry was estimated at INR 19,000 crore in 2006-07 with a total production of 73.6 million units of tyres. In 2006-07, the replacement tyres accounted for 53% of the total tyre tonnage off take, followed by 31% share of OEM and 15% by exports.

Out of the 73.6 million tonnes of tyres, 54.49 million units worth INR 2,600 crore were exported. The exports from India posted a compounded annual growth rate of 13% in unit terms and 18% in value terms between 2002 and 2007.

Japan questions western freight corridor’s feasibility

BS reported that Japanese government, which had shown interest in financing an 800 kilometers long portion of the western dedicated freight corridor between Rewari and Baroda, has now expressed doubts over the project's technical viability and asked the railway ministry to conduct a feasibility study. The portion would cost INR 10,000 crore.

The railways had proposed to lay electric wires at a height of 7.4 meters to run double stack container trains. The Japanese side said that the height was much more than the norm of 6.6 meters in other parts of the world.

Following this, the railways have asked Research Design & Standards Organization to conduct a trial run on a 60 kilometers long stretch in Orissa. The trial is expected to be finished in June 2008. The final report is expected be submitted by the end of June 2008.

Meanwhile, Indian Railways said that it has planned a height of 7.4 meters as most rolling stock in India are flat whereas most other countries in the world use well wagons, which have a lower base.

Mr VK Kaul MD of Dedicated Freight Corridor Corporation of India Limited said that "There would be trial run to see if electrification of the corridor is possible or not. If it succeeds, we will go ahead or look at other options like reducing the height of the wires and using well wagons."

World Bank to sanction INR 16,000 crore loan to UP

Projects Today reported that World Bank is likely to sanction a loan of INR 16,000 crore to the UP government. The loan UP Development Policy Loan is in advanced stage of negotiation and likely to credited to UP with in the current fiscal.

The loan will immensely benefit the finances of the state government as the loan will enable UP to retire costly old debt which will reduce the annual interest burden by INR 700 crore.

The objective of the UPDPL is to retire the old high cost debts from national small saving fund loan on the UP government which was about INR 15,250 crore by the end of March 2008. The WB loan will enable the UP government to swap the costly debt with cheaper loan.

OVL to relinquish block in Libya

Projects Today reported that ONGC Videsh is planning to relinquish its onshore exploration block in Ghadames basin in Libya in favor of the National Oil Company as OVL and its partner Turkish Petroleum Overseas Company felt that the prospects were not very attractive commercially.

In the proposed onshore exploration block of Block NC 188, OVL holds 49% stake and Turkish Petroleum Overseas Company is having the remaining 51% participating interest and is the operator.

OVL has taken the approval of its board for the same. After completing the seismic surveys in the area as per the program, two exploratory wells were drilled in Block NC 188 which were plugged and abandoned as dry wells. Subsequently, the exploration phase of the block has been extended till June 11th 2009.

REC sanctions loan to North Chennai power project

It is reported that Rural Electrification Corporation has sanctioned a loan of INR 3,796 crore to NTPC Tamil Nadu Power Company's North Chennai power project Stage II.

NTPC Tamil Nadu Energy Limited is a 50:50 JV company promoted by NTPC and Tamil Nadu Electricity Board for the project, which will come up at Kuruvimedu village near Chennai.

REC will fund the project single handedly rather than go for a consortium route because it is satisfied with the track record of the promoters. The repayment for the Ennore project will begin only after the project is commissioned and the entire loan will have to be re paid in 15 years.

The first unit of the project, for which BHEL is the contractor, is expected to be commissioned in 2010-11.

Hyundai Motors India to upgrade ITIs in Assam

BS reported that Hyundai Motors India Limited, which had last year upgraded the automobile section of the Industrial Training Institute in Guwahati, is planning to include all the ITIs in the state in a phased manner. Besides, it plans to support other engineering institutes in Assam by supplying training material and providing job opportunities for its students.

Under the plan, Hyundai Motors will supply training material to these institutes and will also train its instructors about the latest automobile technology for the next 5 years. Certificates will be issued by the company to graduates who pass out from these ITIs.

Mr B Mani senior GM of Hyundai Motors India said that "We would include all the ITIs in Assam which have automobile section in a phased manner. Under the Phase I, we upgraded the Guwahati ITI and would include a few more institutes in the next phase."

Mr HS Lheem MD of Hyundai Motors India said that it wants to expand its cooperation in the field of education in Assam.

The company, under the aegis of Hyundai Motor India Foundation, had taken up the Guwahati ITI as the first educational institution to provide such support last year. It has renovated and upgraded the institute's training facility. The renovations were carried on in the classrooms, workshop and the training area to create a more conducive environment for the students.

Mr Mani said that it had invested around INR 30 crore for upgrading Guwahati ITI and would invest further amount as and when required for upgrading other ITIs. Upgrade would include providing special training on the latest automotive technologies to all the trainers at the ITIs. It would provide engine, transmission and other assemblies to the ITIs to enhance the skill and knowledge of the students. He added that presently, 18 trainers from Guwahati ITI have been placed at various dealerships across the state. Assam has 28 ITIs, out of which 18 have automobile sections.

Suzlon may sell some of its REpower stake – Report

Mr Tulsi Tanti chairman of Suzlon Energy Limited said that it may sell a part of its stake in Germany's REpower as the valuation is attractive.

Mr Tanti said that "It is lucrative for us right now." He added that Suzlon directly owns 33.66% of REpower. It also planned to double its China capacity by 2009-10 from the current 600 MW.

IRFC to raise INR 1000 crore via bonds – Report

ET reported that Indian Railway Finance Corporation is selling bonds to raise up to INR 1000 crore. It is selling bonds in 4 tranches. These are 10 year bonds with bullet repayment, 15 year with amortized equal repayment every year, 20 year with amortized equal repayment every year and 20 year with a bullet repayment.

There is no indicative yield specified by the company and the bonds will be sold via book building. The minimum subscription amount under each of the above tranches is INR 500 million and coupon on the bonds is payable semi annually.

Astonfield to invest USD 1.5 billion on renewable power projects in Indian

BS reported that Astonfield Renewable Resources Limited will invest close to USD 1.5 billion over the next 2 years in India in various renewable energy projects. It will also invest an additional USD 500 million in telecom infrastructure business in India.

Astonfield is also about to close on the allotment for a 36 MW municipal solid waste to energy plant in Dhapa in West Bengal, a project that the company has been working on since October 2007.

Last week, Astonfield bought its first plot of land in Bankura, a total of 26 acres that is slated to house a five megawatt solar PV plant, which Astonfield plans to start building later this year.

Mr Sourabh Sen director of Astonfield said that "We have also submitted our proposal to be a part of the 30 MW solar park that the government has sanctioned in Purulia. Several companies together would execute it and Astonfield would want to take up a 15 MW project there."

Mr Sen said that "Our next stop is Bihar and we are already talking to the government. We plan to take up a 100 MW biomass project in Bihar as well as solar and solid waste to power projects."

In 2007, Astonfield received allotments for 10 MW of biomass, 5 MW of solar PV, and 1 MW of manure to power to be executed in Gangarampur, Bankura, and Kalyani respectively.

Deep Industries receives petroleum exploration license

Projects Today reported that Deep Industries has received petroleum exploration license for coal bed methane block at Singrauli in Madhya Pradesh.

This in respect of SR CBM 2005/III with effect to the contract signed with government of India for exploration of CBM.

Global crude steel production in April up by 5.6% YoY

World crude steel production for the 66 countries reporting to the International Iron and Steel Institute was 116.4 million tonnes in April. This is 5.6% higher than the same month last year.

Total world crude steel production was 457.3 million tonnes since January to April 2008 up by 5.7% YoY.

In the first four months of 2008, China produced 169.8 million tonnes of crude steel an increase of 9.1%YoY as compared to the same period in 2007. In April 2008, China’s moving annual total growth rate slowed further to 11.0% compared to its MAT growth rate of 20.6% in April 2007. China’s crude steel production for April 2008 was 44.7 million tonnes an increase of 10.2%YoY on April 2007.

Overall, Asia produced 65.7 million tonnes of crude steel in April 2008 compared to 60.5 million tonnes in April 2007 an 8.7% YoY increase in crude steel production.

In North America, the MAT growth rate for April 2008 was 3.4%, continuing its upward trend. US production was an estimated 8.3 million tons an increase of 1.1%YoY from April 2007, Mexico 1.6 million tons up by 10.5% YoY from April 2007 and Canada 1.4 million tons up by 3.7% YoY from April 2007.

The ‘Other Europe’ region of seven countries outside the EU produced 2.7 million tonnes in April 2008 an increase of 3.1% YoY from April 2007. Turkey’s crude steel production was 2.3 million tonnes which was 2.7% YoY higher than the same month last year. Turkey produced 8.2%YoY more crude steel in the first four months of 2008 than over the same period last year.

Brazilian steel consumption to grow 7.7% per year

The Brazilian Steel Institute forecast that consumption of steel should rise to 40 million tonnes per year up to 2015. The growth, according to estimates should reach 7.7% per year. It is practically double the average forecasted for global demand.

According to the institute, nowadays the Brazilian market absorbs 22 million tonnes of steel a year. The institute said that these forecasts are based on the new forecasts for growth of the Brazilian Gross Domestic Product and on investment to be made in the Brazilian economy in coming years.

The institute said that investment should be in programs that cause great impact on the steel sector, like the Brazilian government's Growth Acceleration Program and the policy for expansion of production. A press statement by the IBS recalls that there are also optimistic forecasts for several Brazilian industrial sectors.

IBS said that Brazilian steel production should also grow. It forecasts that it should reach 63 million tonnes by 2013.

The institute added that investment in the sector should reach USD 32.9 billion by 2013. This causes the IBS to forecast a capacity of 80.6 million tonnes for the national industry between 2015 and 2016. Investment, according to the institute, should permit Brazilian ironworks to supply the domestic demand in Brazil and to maintain the strong export position, generating a trade balance surplus to the country.

Nippon Steel hopes to build steel plant in Thailand – Report

Nippon Steel, which is gearing up production capacity to meet the strengthening demand, has expressed its strong interested in building a steel plant in Thailand, as the country is looking for a foreign partner to develop its steel production.

Besides Nippon Steel, Japan's JFE Steel Corp, ArcelorMittal and China's Baosteel Group Corp. have offered to participate in the project.

Mr Muneoka president of Nippon Steel expressed his confidence as the Japanese firm has a strong lead over other companies in technologies for steel plant construction, also the know how on products for Japanese companies and can securely build a steel plant with an annual output of 3 million tons.

Mr Muneoka said that in addition, ArcelorMittal has no experience of building steel mills on its own and he also questioned the firm's ability to produce steel sheets for Japanese home electronics makers.

Thailand is expected to choose only one firm.

Kremikovtzi to get EUR 30 million from ArcelorMittal

It is reported that the largest Bulgarian steel plant Kremikovtzi is to get a financial injection of EUR 30 million from ArcelorMittal.

According to the Kremikovtzi steel mill management, the money is to be used to pay the debts of Kremikovtzi, as well as for workers' salaries.

ArcelorMittal is one of the bidders for the purchase of 71% of Kremikovtzi. Vorskla Steel of the Ukrainian tycoon Mr Konstantin Zhevago is the other candidate for the plant.

Esmark responds to USW objections to proposed transaction with Essar Steel

Esmark Incorporated responded to the position taken on Friday by the United Steelworkers concerning the proposed tender offer and subsequent merger with Essar Steel Holdings Limited emphasizing that the Company has in all cases observed both the spirit as well as the letter of the right to bid process under the Collective Bargaining Agreement, both in its negotiation with Essar and interaction with the USW.

Mr James P Bouchard chairman & CEO of Esmark said that "The Esmark proposed transaction was unanimously approved by the Company's Board of Directors. Essar is a fine company with the resources and management commitment to invest significantly in the Ohio Valley. Esmark brought Essar management to Pittsburgh early in the negotiation process to meet with union officials, and we consistently invited the USW's involvement in and support of the Essar transaction."

He said that “The USW is attempting to challenge a transaction which would maximize value for our shareholders and revitalize Wheeling Pittsburgh Steel and the Ohio Valley. Despite the USW's direct involvement in the sale process of the Company since as early as February of this year, the USW has not made or otherwise arranged an offer for the Company that is equal to or superior to Essar's proposed transaction.”

Mr Bouchard noted that "Therefore, Esmark is encouraging the USW to join in immediate, open and constructive dialogue with Esmark and Essar to complete the only transaction to materialize as of this date a transaction which is in the best interests of the shareholders, debt holders, employees and the communities supported by all Esmark facilities and our Wheeling Pittsburgh Steel subsidiary. Essar Steel Holdings, which owns Algoma Steel, Minnesota Steel and the Essar DRI project in Trinidad and Tobago, has the potential to become a leading low cost steel producer in North America."

Essar's proposed tender offer for the common stock of Esmark Incorporated and subsequent merger is subject to certain conditions, including expiration or waiver of any USW right to bid period, the valid tender in the offer of a majority of the fully diluted Esmark common stock and other customary conditions as well as the approval by the Department of Justice and Committee on Foreign Investment in the United States.

Morgan upgrades ArcelorMittal Georgetown steel plant

According to Mr Danie Devapiriam manager rolling mill division, the installation of Morgan Construction Company’s No Twist Mill® guide upgrades has resulted in significant improvements in mill utilization at the ArcelorMittal Georgetown steel plant at Georgetown in South Carolina State of US.

Mr Devapiriam said that “In May 2007, we completed a total upgrade to the latest Morgan guide equipment for both strands in our mill. At the time of the upgrade, we had been experiencing many delays and cobbles in the NTM utilizing outdated equipment.”

He said that “After the upgrade of the static receiving guides and mounting, static delivery guides and mounting, and the X clamp roller entry guide system including the guides, mountings and precision optical alignment equipment we have seen significant reductions in the cobble rate as well as improved product tolerance and the reduction of flutter in the mill. Overall we have experienced better than expected performance and benefits from this upgrade over the past five months.”

Morgan Construction Company is a designer and producer of high quality rolling mill products and services for the metal industry worldwide.

US seamless tube prices increases

Vallourec & Mannesmann Tubes, a world market leader in the manufacture of seamless hot rolled steel tubes for all applications in US, has announced to increase the price of seamless mechanical tubing by USD 250 per short ton.

It is expected that this price increasing will be effective from May 15th 2008 for new orders. Besides, the price increasing will be effective on all sizes and grades.

(Sourced from YIEH.com)

US weekly crude steel production increase by 1.1%YoY

American Iron & Steel Industries reported that in the week ending May 17th 2008, US’s raw steel production was 2.146 million net tons while the capability utilization rate was 89.9%. Production was 2.121 million net tons in the week ending May 17th 2007, while the capability utilization then was 88.4%. The current week production represents 1.1% increase from the same period in 2007.

Production for the week ending May 17th 2008 is up 0.4% from the previous week ending May 10th 2008 when production was 2.136 million net tons and the rate of capability utilization was 89.5%.

Adjusted YTD production through May 17th08 was 41.736 million net tons at a capability utilization rate of 88.7%. That is a 3.3% increase from the 40.399 million net tons during the same period last year, when the capability utilization rate was 85.1%.

District wise production for the week ending March 15th 2008
1. Northeast Coast: 181
2. Pittsburgh/Youngstown: 214
3. Lake Erie: 86
4. Detroit: 106
5. Indiana/Chicago: 520
6. Midwest: 247
7. Southern: 698
8. Western: 94
(In thousands of net tons)

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

Vietnam exports more billet due to weak domestic demand

It is reported that Vietnam steel billet makers are anxious to export more capacity due to falling domestic demand.

Two of major producers, Van Loi Steel and Dinh Vu Steel are planning to export an estimated 10,000 and 30,000 tonnes steel billets to the Philippines and Southeast Asia due to inflation control on the part of the government.

Vietnam steel billet export price has been marked at USD 800 per tonne which is lower than the regional prices, but the domestic market price has already increased up to USD 950 per tonne.

This may result in the regional producers looking for material in the domestic market instead of importing stock from overseas.

Carbon steel plate import in Taiwan up by 42.15% MoM

According to Custom’s related statistics, Taiwan imported 84,626 tonnes of carbon steel plate in April 2008 up by 42.15% MoM. The import from China was the top at 67,715 tonnes up by 64.18%MoM and the import price on average was at USD 984.57 per tonne.

Also, the import from Japan and Romania was followed by 532 tonnes and 490 tonnes and the import price was at USD 1090.58 per tonne and USD 720.38 per tonne respectively.

In Taiwan, the January to April 2008 period was at 288,024 tonnes. Besides, Taiwan’s export of carbon steel plate in April 2008 was at 7,215 tonnes and the total export from January to April was at 54,973 tonnes.

(Sourced from YIEH.com)

ArcelorMittal announces bond issue

ArcelorMittal on May 19th 2008 completed the pricing of a USD denominated issue of 5 year and 10 year notes, consisting of USD 3,000,000,000 aggregate principal amount split equally between the 5 year and the 10 year issue.

The notes will bear interest at a rate of 5.375% for the 5 year and 6.125% for the 10 year and will mature on June 1st 2013 and June 1st 2018, respectively.

The Notes will be issued by ArcelorMittal and it will be offered and sold under the US Securities Act 1933.

The net proceeds raised will be used to repay existing indebtness.

Fitch assigns ArcelorMittal bonds an expected 'BBB' rating

Fitch Ratings said that it has assigned ArcelorMittal SA’s prospective USD bond issue an expected senior unsecured BBB rating. The expected rating is in line with ArcelorMittal SA’s BBB Long term Issuer Default rating. At the same time, Fitch has affirmed ArcelorMittal SA’s Long term IDR and senior unsecured ratings at BBB and Short term IDR at F2. The Outlook for ArcelorMittal SA’s Long term IDR is Positive.

Proceeds from the bonds are expected to be used to refinance and extend the tenor of existing group debt. The bonds will be a direct, unconditional and unsecured obligation of ArcelorMittal SA’s. The final rating for the issue will be assigned once the tenor and amount of the bonds are known and is subject to receipt of final documentation materially conforming to the draft documentation reviewed by Fitch.

Fitch notes that the bond draft documentation includes protection to bondholders in the event of an acquisition through a change of control clause, although there are some exceptions including in respect of a change of control involving members of the Mittal family. While there are no restrictions on additional debt, the bonds benefit from a negative pledge regarding secured indebtedness at ArcelorMittal SA’s and material subsidiaries. The draft documentation does not contain specific financial covenants.

ArcelorMittal SA’s outlook was revised to Positive from Stable on December 14th 2007. The revision reflects Fitch's opinion that ArcelorMittal SA’s scale and diversity, combined with current developments to strengthen its operational should enable the group to record more stable financial performance relative to industry peers.

Moody assigns A1 rating to Nucor

Moody's Investors Service has affirmed Nucor Corp's A1 senior unsecured rating and Prime-1 short term rating, with a stable outlook, after the company announced an offering of 25 million shares and its intention to raise up to USD 1 billion as debt in the near term.

Moody said that the A1 rating reflects the steel producer's strong operating characteristics, low cost profile and technological competencies.

However, it also recognizes the cyclic nature of the steel industry, the company's increasing financial leverage position as a result of recent growth related capital spending and acquisitions and the competitive threat from imports, which could disrupt domestic pricing.

Moody downgraded Zlomrex corporate family rating to Caa1

Moody's Investors Service said that it has downgraded Zlomrex SA's B3 corporate family rating and Zlomrex International Finance's Caa2 senior secured rating to Caa1 and Caa3 respectively citing higher than expected leverage per year end 2007 and the continued aggressive business model in terms of refinancing where the company's operations are dependent upon frequent renewals of short term lines of credits.

Moody's said that the outlook on both ratings is stable, reflecting the assumption that the steel producer is more likely than not to continue to be successful in extending these facilities as they expire in 2008.

Though Moody's expects that results in 2008 will be better and more stable than in 2007 due to improving local markets in central and Eastern Europe and additional cash flows, the risks related to the uncertainties for the 2008 performance and the short term maturities of Zlomrex debt outweigh the expected positive contribution from businesses acquired at the end of 2007.

Nucor announces common stock offering

Nucor Corporation announced that it has commenced a public offering of 25,000,000 shares of its common stock. Nucor has granted the underwriters an option to purchase up to an additional 3,750,000 shares of common stock at the public offering price, less the underwriting commission, within 30 days following the closing date. The offering is expected to close on or around May 29th 2008.

Nucor intends to use the net proceeds from the offering for general corporate purposes, including acquisitions, capital expenditures, working capital needs and repayment of debt. In addition, Nucor intends to raise up to USD 1 billion in the debt capital markets in the near term, subject to market conditions.

Banc of America Securities LLC, Citigroup Global Markets Inc and J P Morgan Securities Inc. are acting as Joint Book-Running Managers for the offering.

Quanex appoints Mr Petratis as new CEO

Quanex Building Products Corp a manufacturer of engineered materials and components for the building products market said that it appointed Mr David Petratis as president and chief executive, effective from July 1st 2008.

Mr Petratis who is currently CEO of Schneider Electric's North American operating division will succeed Mr Raymond Jean.

EAF gaining currency over BOF

Global warming is the buzzword reverberating all over the boardrooms of corporates across the world. This ecological concern is forcing manufacturers to scout around for eco friendly systems and processes to survive longer. Steel makers are no exception and hence the search and switch to better technologies. As a result, Electric Arc Furnace steelmaking is gaining an upper hand over the traditional or conventional Basic Oxygen Furnace.

It is no exaggeration to claim that the iron and steel industry has undergone a technological revolution in the last few years. In a short span of time, this industry has observed the complete disappearance of basic open hearth process. Now there is a complete shift in the steel making industry towards the electric arc furnace technology.

Steel is produced through mainly two methods – Integrated steel making route and EAF route.

Integrated steel making route is based on blast furnace and Basic Oxygen furnace. Main raw materials used in this procedure are iron ore, limestone, coal and recycled steels.

Second technology is Electric Arc Furnace steelmaking. In this advanced technology an electrically heated furnace is used that makes steel from the recycled iron and steel scrap metal. EAF technology is more preferred option as it uses scrap that is otherwise very harmful for the environment. Moreover it consumes lesser energy. A large number of steel making companies have already shifted to this technology. According to the Intergovernmental Panel on Climate Change (IPCC), the steel industry accounts for between 3-4% of total world greenhouse gas emissions.

Innovative Actions
So, more companies are going for the EAF steel manufacturing. Apart from the conventional processes, many steel manufacturing companies are taking more innovative actions. Steel companies all over the world are investing in state-of-the-art systems to improve their operations and yield. Technological advancements over the past 25 years have enabled substantial reductions in CO2 emissions from steel production.

A good example of this is the FINEX iron making process, used by Korean company Posco. The Finex system is an innovative eco-friendly technology that has reduced emissions of environmentally-harmful materials.

This technology reduced the emissions by almost 80% as compared to blast furnace route. In Sept. 2004 the Posco started the construction of 1.5 million metric tons a year plant. So the FINEX technology is expected to emerge as the technology that will be a source of clean steel in 21st century.

Other leading steel companies like Arcelor, Erdemir, China Steel Corporation, US Steel Corporation, Nippon steel, Corus, Blue Scope, Riva etc all are adopting the eco-friendly technologies.

Water Conservation
Another example is set by the CST a subsidiary of Arcelor in Brazil. Here is a water resource management system in which sea water is used as 96% of the total water used for steel manufacturing. Thus this system helps in saving the fresh water. Only 4% of water used comes from local fresh water sources.

In the same way Saldanha Steel ltd., a subsidiary of Mittal Steel South Africa Ltd. uses treated sewage water. Various facilities are being installed for reverse osmosis and to desalinate the water used so that fresh water usage is decreased significantly.

Declining Coal Dependency
Other than these eco-friendly technologies the steel industry will see another change in near future. The output from BOS process will significantly decrease due to diminishing supplies of coking coal and other raw materials. So it will give a boost to steel recycling techniques through EAF.

All the leading companies are going for usage of pulverized coal, natural gas and recycled plastics to replace the metallurgical coke used as the primary reductant and source of chemical energy. This change represents an important development in the steel making process.

Usage of Coke and the process of coke-making are extremely harmful for the environment. Therefore moving away from the use of coke is a new step in the steel making process that will lead to a cleaner steel manufacturing.

Recovery & Reusage
More companies are investing in energy savings with usage of new iron and steelmaking technologies. This is being done through the recovery and re-use of waste gases and through heat recovery from the various steel making processes. These recoveries make steel manufacturing more affordable.

New technologies used are bound to add to the quality of the steel. Still industry needs to invent more technologies to cut CO2 emissions. Further steps can be taken to move away from carbon and give preference to hydrogen and electricity.
The continuous improvements are taking place in EAF process control and the use of ore-based scrap substitute materials such as direct reduced iron, hot briquette iron and pig iron. These further advancements will lead to significantly increased product quality range. These goals can be achieved only by moving towards new and advanced technologies.

(Eco friendliness is driving steel makers towards EAF, writes Ramesh Kumar & Rohini Varma for SteelGuru readers)

Vietnam Ho Chi Minh City Metal projects USD 237 million revenues in 2008

VNA reported that Vietnam Ho Chi Minh City Metal Joint Stock Co planned to gain total turnover of VND 3.8 trillion (USD 237.5 million) and a pre tax profit of VND 60 billion (USD 3.75 million ) in 2008. Its dividend was expected to reach between 16-18 percent.

Metal Joint Stock Co said that in the first quarter of the year obtained some VND 1.1 trillion in net revenues, up by 42.2% QoQ and nearly VND 16 billion in after tax profits up by 45% QoQ.

MHI stands firm against Japanese steel mill push for prices

Lloyd’s List reported that Japan’s fifth largest shipbuilder Mitsubishi Heavy Industries has denied Japanese news reports that it has buckled in negotiations with steel mills and conceded increases of JPY 30,000 (USD 200) per tonne.

A spokesman of MHI told Lloyd’s List that “We have heard the story but it is not true. Our purchasing department has told us that negotiations are continuing.”

A source from another major shipbuilder said that “We don’t believe that MHI has given in. All our sources both internally and externally suggest that negotiations are still ongoing at MHI as they are at the other major yards in Japan.

The senior executive denied that there was any joint effort among the yards involved to resist the steel mills’ demands but added that they were in communication and agreed to let each other know if any had given in under the intense pressure the mills were beginning to bring to bear.

The report said that Japanese shipbuilders have been adopting a siege position since protracted negotiations with the steel mills began in February. But the country’s two major steel mills JFE and Nippon Steel are digging their heels in as their manufacturing costs escalate.
At the start of negotiations the steel mills had originally requested a mark up of JPY 20,000 following their acceptance of a 65% increase in iron ore prices from Vale of Brazil and Australian mining concerns. But as talks progressed the steel suppliers found themselves confronted with further increases from coal suppliers of 300% and subsequently upped their demands for steel plate increases to JPY 30,000 or close to 40%.

In response to the news that MHI may have broken the chain of understanding between the nation’s shipyards that none of them would give in to the demands of the mills.

Flat product price increase pace slows down in US

Platts reported that flat rolled steel prices continued to gain in the US market for product from domestic mills. The magnitude of the increases by USD 20 to USD 25 per short ton appears to be lessening compared with price gains earlier this year. What is more, US mills are quoting a fairly wide range of price offers for bookings in late June, July and even August.

The prices range from USD 1,060 per short ton ex works for hot rolled coil from ArcelorMittal USA for July to August delivery, to USD 1,125 per short ton ex works from smaller producers such as AK Steel, WCI Steel and Wheeling Pittsburgh.

Other mills fall somewhere in between, according to either their own announcements or reports from buyers. These include Nucor, which is offering HRC at about USD 1,090 per short ton ex works for July; Steel Dynamics, which is said to be quoting the same product at USD 1,090 per short ton ex works for any remaining June tonnage and USD 1,080 per short ton ex works from US Steel.

As a result and based on reported transactions, the Platts price assessments increased to a midpoint of USD 1,050 per short ton for HRC and to USD 1,135 per short ton for CRC, both ex works Indiana.

Some buyers are starting to wonder if the mills offering July HRC at USD 1,125 per short ton ex works, might show some flexibility given the fact that other producers are as much as USD 65 per short ton below such a price.

One Chicago area buyer told Platts that "It is too early to say. They certainly have not backed off yet. It all depends how many tons are available in July. If the market remains tight, I doubt they will back off from USD 1,125 per short ton ex works.”

S&P says Nucor ratings outlook unaffected by USD 2 billion equity issuance

Standard & Poor's Ratings Services said that its ratings and outlook on US steel maker Nucor Corp are not affected by the company's announcement that it plans to issue about USD 2 billion of common equity.

S&P said that the proceeds will be used to help fund the company's capital spending and acquisition plans, which will likely greatly exceed internally generated cash, despite favourable operating conditions.

Nucor has been acquiring scrap processors and downstream fabrication businesses and recently announced plans to build a pig iron facility in Louisiana and to invest in two European joint ventures.

Bulgarian trade unionists want Kremikovtzi declared bankrupt

It is reported that Bulgaria's Podkrepa Labor Confederation insisted that the troubled Kremikovtzi steel plant be declared bankrupt and that a new owner take over.

Podkrepa has submitted a declaration to the Prime Minister Sergey Stanishev and to the Energy Minister warning that the factory would stop working and workers' protests would follow unless funds for raw materials were provided by the end of the week.

The trade union is also insisting on a recovery plan for Kremikovtzi and the providing of at least EUR 20 million for environmental investments under government control.

Mr Lyudmil Pavlov chairman of Podkrepa's Metallurgy Federation said that the USD 500 million bid of Mr LN Mittal was several times larger than the bid of the Ukrainian tycoon Mr Konstantin Zhevago and his Vorskla Steel but pointed out that the Ukrainian company has made commitments to the social requirements of the workers.

With respect to the Mr Mittal's offer to provide a financial injection of EUR 30 million for the payment of the factory's debts, Mr Pavlov said it was made on the condition the negotiations for the sale of Kremikovtzi would be conducted only with ArcelorMittal.

Mr Pavlov said that "The difference between the two offers is that the first one of ArcelorMittal speaks about the future. The other one refers about how the factory should be operating at present so that it could survive.”

Japanese April crude steel output up by 4.2% YoY

According to Japan Iron and Steel Federation, Japan's production of crude steel rose 4.2% YoY in April 2008 to 10.15 million tonnes, its 23rd consecutive on year rise. But steel output was down 5.8% MoM from March 2008.

April 2008 productions figures are

(Volume in million tonne)
(Change in YoY)

Higher cost effecting electric wire makers profitability in Japan

JMB reported that Japanese 3 electric wire makers out of major 6 firms posted lower consolidated recurring profit for the year ending March 2008 from previous year due to higher yen rate.

As per report Sumitomo Electric Industries, Furukawa Electric and Hitachi Cable expect lower recurring profit for the year ending March 2009 due to higher yen rate, higher depreciation under new accounting system and higher raw materials cost. The major makers try to improve the profitability trough higher sales for strategic products, cost cutting effort and price hike.

Tentative agreement reached between AAM and UAW

It is reported that the United Autoworkers bargaining team has reached a tentative agreement with American Axle Manufacturing. The deal which is presently being voted on by union workers was reached by the bargaining sides on May 16th 2008.

Mr Ron Gettelfinger president of UAW said that "Our members at American Axle have displayed extraordinary solidarity during this strike. The bargaining committee worked extremely hard to achieve this tentative agreement and they have voted to recommend it to the membership."

The strike began in late February and shut down American Axle Manufacturing plants in Michigan and New York.

The strike created a ripple effect, with some partial shutdowns at around 30 different General Motors plants throughout North America.

Air Products to build ASU at Canadian unit of US Steel

Air Products announced the signing of a new long term supply contract between its subsidiary, Air Products Canada Ltd and US Steel Canada, Inc.

In conjunction with this new agreement, Air Products will build a new air separation unit with a high efficiency liquefier facility. The new facility, to be on stream in the fourth quarter of 2009, marks an expansion of Air Products’ oxygen and nitrogen supply to the steel mill and increased merchant liquid argon capacity, as well as a more efficient production of merchant liquid oxygen and nitrogen for Air Products’ operation at its Nanticoke facility.

The new ASU will supply over 1,200 tons per day of gaseous oxygen for US Steel’s operations. The new high efficiency liquefier will produce over 500 TPD of liquid oxygen and liquid nitrogen and increase pure liquid argon production capacity for North American customers in several market applications. The larger and more efficient facility will replace the original Air Products’ plant at the same location.

Mr Alex Masetti vice president Tonnage Gases North America for Air Products said that “We have been supplying the Lake Erie facility’s tonnage industrial gas requirements with our original Nanticoke air separation plant since 1980. This latest investment by Air Products keeps pace with Lake Erie's increased demand for industrial gases and represents another milestone in our long-term relationship. At the same time, the new liquefier will increase our supply capacity and improve our market position in the Eastern Canada and Northeastern U.S. markets for liquid products.”

AK Tube honored for safety performance

AK Steel announced that the Walbridge, Ohio plant of AK Tube LLC has been honored with two awards for its safety performance from the Ohio Bureau of Workers' Compensation, division of Safety and Hygiene.

The awards are the 100% Award for operating the entire year of 2007 without a lost-time injury; and, the Achievement Award for logging a 2007 OSHA incident rate more than 25% lower than the previous year. The awards were presented at the Safety Council of Northwest Ohio's annual industrial safety awards banquet held on May 15th 2008.

Mr James L Wainscott chairman, president & CEO of AK Steel said that "We congratulate our AK Tube Walbridge employees for their outstanding safety achievements in 2007. It is especially significant that they worked the entire year without a single lost-time injury."

Overall, AK Steel led the steel industry in safety during 2007 with a corporate wide injury rate that was 12 times better than the industry average, according to data compiled by the American Iron and Steel Institute.

Top 10 GCC steel plant projects total USD 9.5 billion – Report

According to the database of research company Proleads, the top ten new steel production projects in GCC countries amount to a staggering investment value of USD 9.5 billion. The projects are listed below

1) Al Tuwairqi Group Integrated Steel Complex
The USD 2 billion planned project is for an integrated complex of steel factories in Dammam industrial area. The complex will have a 500,000 tonne per annum railway bar manufacturing plant, a 3 million tonne per annum integrated iron and steel processing and production plant and 800,000 tonne per annum steel pipeline manufacturing plant.

2) Qatar Steel Company Mesaieed Integrated Steel Facility
The USD 1.5 billion project currently being executed is for an integrated steel facility with a hot briquette iron plant and a flat rolled steel products plant. The facility will have a production capacity of 4 million tonne per annum.

3) Saudi Iron & Steel Company Jubail mill expansion 3
The USD 1 billion planned project calls for expanding steel production by 1 million tonnes per year.

4) Sojitz Corporation Steel Plant in UAE
The USD 1 billion planned project in Fujairah is for a plant that will turn iron ore pellets into steel billets with capacity of 1.5 million tonnes a year.

5) Essar Group Steel Plant in Qatar
The USD 800 million project currently being carried out is for a 1.5 million tonnes per year steel rolling mill plant and a 1 million tonne per year hot briquette steel.

6) Al Ruya Industries Hamriya Steel Plant in UAE
This USD 700 million project under study is for an integrated steel making facility in Hamriya free zone.

7) Sohar Industrial Port Company Iron Ore Pellet Plant in Oman
The USD 700 million project is being carried out for an iron ore pellet plant. The plant will receive 7.5 million tonnes of raw materials a year. Sohar will export the pellets to steel producers in the GCC.

8) Boulder Seamless Tube Project in UAE
This USD 600 project is the design phase for a seamless steel tube finishing facility with a capacity of 175,000 tonne per annum in Hamriyah Free Zone. Feedstock will come from Boulder steel mill in Queensland in Australia.

9) Saudi Iron & Steel Company Jubail mill expansion 2
The USD 600 project currently being carried out is for a direct reduction iron plant with a capacity of 1.76 million tonnes per annum. It includes increasing annual production capacity of electric steel making by 1.22 million tonnes per annum.

10) Pan Kingdom Investment Company Jizan Economic City Steel Plant Future Expansion in Saudi Arabia
This USD 600 project is under study for expanding the production capacity of the plant, including a rolling mill, melt shop and a direct reduction iron plant.

L&T bags EPC contracts worth INR 635 crore in UAE and Oman

Projects Today reported that Larsen & Toubro has bagged 4 EPC electrical project orders worth INR 635 crore from UAE and Oman in the Gulf Region. The projects will be executed by the electrical projects and gulf operations vertical of L&T's construction division.

Two of these orders valued at INR 521 crore were secured from Abu Dhabi Water & Electricity Authority and involve supply and construction of five 33/11 kV GIS substations and 33 kV cabling works.

Apart from this, L&T’s subsidiary L&T Oman has bagged two orders valued at INR 114 crore. While one order is from Oman Electricity & Transmission Company for construction of 132 kV grid substation and associated transmission lines at Saham area of Oman, the other order is received from Muscat Electricity Distribution Co for 33/11 kV substation at the Mabella Region of Oman. Both projects are to be completed within 10 to 13 months.

UAE joins GCC power grid – Report

UAE news agency WAM reported that UAE has officially joined the GCC power grid in its current phase.

Mr Yousef Ahmed Janahi director of planning at Qatari Water & Electricity Corporation said that UAE has fulfilled its financial obligations as provided for in the relevant agreements. He added that the draft of the multilateral power grid agreement is ready and will be sent to the GCC secretariat.

The USD 1.6 billion project is being carried out in three phases, with the entire grid system connecting the 6 Gulf Arab states set to be completed by 2010. Phase one of the project will link the grids of Qatar, Saudi Arabia, Kuwait and Bahrain.

GAIL may get stake in IPI pipeline project – Report

BL reported that GAIL (India) Limited could become a consortium partner in the Pakistan India portion of the Iran Pakistan India gas pipeline project.

A senior official said that "In the portion of the pipeline being constructed from Pakistan to the Indian border, it has been proposed that an Indian company would be a stakeholder." The official also told that as stakeholder the Indian company will also have a place in the management of the consortium.

The proposal was made at the recent ministerial level bilateral meeting between Pakistan and India on issues pertaining to the tri national pipeline project. Three bilateral issues were discussed at the meeting, the structure of the pipeline company which will execute and manage the project, the transportation tariff and the transit fee.

As regards the transit fee to be charged by Pakistan, the official said that it would be de linked from the price of the gas. He added that "The transit fee is a very small element of the total cost and it will be decided at a later stage by the respective governments."

The principles of transportation charges have already been agreed on between the two sides for the over USD 7 billion pipeline project. The transportation charges will be levied on CAPEX plus operating costs basis, based on international competitive bidding. India would now decide whether to have another round of bilateral talks before resuming trilateral talks on the project.

Gulf States may soon need coal imports to keep the lights on

It is reported that Emirates were built on oil and provide fuel to the world but already they need other sources of energy. Now the oil rich Gulf States are planning to import coal. An acute shortage of natural gas has led to the city states of the United Arab Emirates seeking alternative fuels to keep the air cool, the lights on and the water running.

Abu Dhabi is working with Suez, on a nuclear power project but coal is emerging as the best quick fix to avert blackouts as the world’s biggest hydrocarbon exporters struggle to cope with high prices for oil and natural gas, infrastructure weakness and a development boom. Some of the world’s biggest oil exporters may soon find themselves reliant on imported fuel from a leading coal exporter, such as South Africa.

As a result, Abu Dhabi’s national energy company Taqa plans to take a half share in a proposed EUR 500 million coal fired power plant, while Dubai Electricity & Water Authority hopes to start work on a clean coal project this year.

Oman Power & Water Procurement Company indicated in December 2007 that a planned 700 MW power and water desalination plant may need to be fuelled by coal instead of natural gas.

The dramatic transformation is taking place because, for the first time, the Gulf States are beginning to feel the burden of the soaring cost of fossil fuels. In March 2008 Dubai introduced an electricity pricing system that increased tariffs for heavy users. The new tariffs apply only to foreign businesses, expatriates and foreign-owned businesses. Emirates are exempt.

The sudden gas shortage has caught the Gulf States by surprise at a time when demand for power and water desalination is increasing annually at double digit percentage rates. Investment in infrastructure has lagged behind the region’s population expansion and construction boom. Anecdotes abound of apartment complexes left empty because there is not enough capacity in the local electricity grid.

Last summer Abu Dhabi’s oil output fell by 600,000 barrels per day as natural gas was diverted from injection into oil wells to power stations to meet peak demand for electricity. The Emirate has substantial reserves of gas but much of this is earmarked for injection into wells to maintain pressure and to improve oil output. With the crude oil price reaching USD 125 per barrel, the diversion of gas into local power stations is a huge cost to the country.

Meanwhile, the price of natural gas in the Gulf has soared amid shortages and increased global demand. Local gas resources in the Emirates have dwindled, and Abu Dhabi and Dubai are already importing gas by pipeline from Qatar.

Iran, which holds some of the world’s biggest gas reserves, is another option, but relations between the Western friendly Emirates and Iran are uneasy. A project led by Dana Gas, a private sector company based in the Middle East, to bring Iranian fuel across the Gulf to Sharjah has been locked in pricing disputes.

In a desperate attempt to avert power and water shortages in the summer, Dubai entered into a 15 year contract with Royal Dutch Shell last month to supply liquefied natural gas in the summer period from 2010. However, this is an expensive fuel and the Emirates have built their economies on gas at almost nil cost.

Sipil Construction builds structural steel factory in Turkey

Turkish Daily reported that construction firm Sipil Construction has started to manufacture structural steel in the fourth section of Manisa's organized industry region.

Mr Hakkı Bayraktar chairman of Sipil Construction said that the construction of the factory was completed in a short time and the firm utilized only its own resources. He added that "Covering an area of 15,728 square meters, 10,000 of which is an enclosed area, we completed the infrastructure and started to produce at some units of the factory."

Mr Bayraktar said that "We managed to produce steel colon, which is our first structural steel product and we sent them to Bursa. Having expert engineers and architects, Sipil Construction produces steel products successfully." He added that with a capacity of 5,000 tonnes it will grow in the production of structural steel.

Danube to invest AED 50 million in a new facility in Ajman

Danube Building Materials has announced its plans to invest AED 50 million in the construction of a new facility in Ajman, which is set to commence its large scale operations in 3 months.

With aims of increasing its production volume to address the mounting building material requirements in the Gulf region, the new facility is expected to supply high quality construction materials to major profile projects in the emirate, including Emirates Commercial City, Ajman Eye City, Al Helio Downtown, Al Zorah Beach project, Marmouka City, Wafi City and Ajman International Airport, along with other projects in UAE.

As the demand for grade ‘A' building materials continues to drive up regional construction costs, which have risen by about 30% in the past 12 months, Danube has recognized the need to establish a new hub to add to its factories in China, Bahrain and the UAE.

The new plant will span 120,000 square feet in Ajman's Al Jarf area, where high quality wood, laminates, multi density fiber boards, steel, aluminum, glass, hardware and sanitary solutions, low to high end flooring, ceiling, doors and kitchen fixtures will be manufactured in bulk.

Mr Rizwan Sajan chairman of Danube Building Materials said that "Our expansion into Ajman, which closely follows the recent launch of our plant in China, is a testament to the rapid growth pace at which we are moving at to leverage the booming construction market in the region. The fact that Danube is the first company to establish a dedicated facility for top grade construction materials to service the many multi-billion Dirham projects planned for Ajman reflects our confidence in this emirate, and highlights our commitment to supporting the growth of the regional market."

Danube has identified Ajman as an ideal location for its new facility due to the massive infrastructural developments being undertaken in the emirate, in addition to its conveniently accessible location. As a result, total investment in Ajman real estate has crossed the AED 400 billion mark in 2007, with the launch of multimillion dirham waterfront ventures, high end commercial projects and budget residential houses strengthening its repute as the newest real estate destination in the UAE.

Danube is one of the largest building suppliers in the UAE and the region with an extensive portfolio of 10,000 selections ranging from MDF, plywood, timber, laminates, veneers to sanitary fittings, hardware, ironmongery, aluminum and glass among others. In 2004, it began its operations in Jebel Ali with a 19,000 square meter warehouse cum office, which serves as its regional hub and caters to booming markets in UAE, Oman, Bahrain and India.

Fatalities at Istanbul Tuzla shipyards raised to 24 – Report

It is reported that fatalities from accidents at Istanbul's notorious Tuzla shipyards climbed to 24 in the past 10 months, when 2 more workers were killed separate accidents over the weekend.

As per report, on Saturday morning, Mr Deniz Kaskeman was crushed by a 2 tonne steel plate in the Selah shipyard and was pronounced dead on arrival at Doctor Lütfi KÄrdar Kartal Education & Research Hospital. In the 6 months, the Lort Marin Ship Building & Commerce Limited Company, which operated the Selah shipyard, was fined for having unsafe working conditions.

On Saturday night, Mr Murat ÇalÄŸkan, fell from a welding platform at the same shipyard and was pronounced dead in the yard.

Earlier in May 2008, one man was killed and 5 injured in an explosion in the engine room of a ship in build at a Tuzla shipyard.

Oman Gas set to venture into upstream gas business

Khaleej Times reported that Oman Gas Company SAOC, which owns and operates Oman’s burgeoning gas transportation network, is diversifying its business portfolio to include a significant role in the upstream side of the natural gas business. The move is in line with its vision to eventually grow into an integrated gas company with interests in, among other areas, upstream gas development, and construction and operation hydrocarbon processing facilities.

Dr Mohammed bin Hamad al Rumhy Omani minister of oil & gas and also chairman of OGC said that "The coming 5 years are likely to witness a great change in OGC's business as it focuses on being commercially more enterprising rather than a mere gas transporter. OGC is turning now to be an integrated gas company which will be taking greater custodianship of the gas energy market in Oman. The company intends to go more upstream starting with its participation in the new gas concession areas."

Mr Yousuf bin Mohammed al Ojaili CEO of OGC said that the aim is to manage gas as a resource on a countrywide scale, implementing strategies to meet the demand in terms of volume as well as quality. He added that "OGC is preparing to enter into partnerships in upstream gas development, as well as in the engineering, construction and operation of hydrocarbon processing facilities. Last year was the start of the journey to take OGC into the next stage of business and responsibilities."

Mr Al Ojaili said that "I am glad to note that this has progressed very well with the full support from the Board and government, and OGC is now getting ready to participate in upstream gas developments and will be teaming up with other government companies in the Sultanate to realize there opportunities."

OGC’s planned foray into the upstream gas business comes against a backdrop of an accelerated expansion of the gas transportation and compression capacity of its network. Work is under way on a new compression station in Fahud on the 32 inch pipeline that supplies gas to Sohar. A similar compression station is also under development at Buraimi to facilitate the import of low pressure gas from Dolphin Energy from the United Arab Emirates to Sohar. Work on both compression projects will be completed in the third quarter of this year.

OGC has also launched work on a new 250km loop line from Saih Rawl to Mukhaizna, which will be integrated with the existing Saih Rawl Salalah pipeline. The project is expected to be completed in the third quarter of this year. New EPC contracts are also due to be awarded for additional compression capacity at Nimr aimed at augmenting supplies to Salalah, where a major methanol scheme is under development, while a new power and desalination plant is envisaged.

Iran calls for foreign investments in petrochemical projects

IRNA reported that Mr Gholam Hossein Nozari Iranian oil minister has invited foreign companies to make investments in the upstream and downstream projects of the country's petrochemical industry.

Mr Nozari made the call in his address to the opening ceremony of the eighth session of Iran's Petrochemical Forum. The two day conference is participated by senior experts of oil and petrochemical industries from 118 Iranian and over 76 foreign companies from 27 countries.

The participants would discuss present and future challenges facing Iran and world's energy sectors and their petrochemical industries, the role of refining in petrochemical industry, prospects of the industry as well as technologies related to petrochemical industry.

Mr Nozari said that foreign companies could make both independent and joint investments in Iran working with their Iranian counterparts by financial and technological partnership. He added that based on the country's 20 Year Vision Plan for Economic, Social and Cultural Development, Iran's petrochemical industry needs about USD 30 billion investment.

Iran’s talks with UAE’s Crescent Oil very positive

Mehr News Agency reported that the latest talks between United Arab Emirates’ Crescent Petroleum and National Iranian Gas Export Company were very positive and in line with securing national interests.

Mr Nosratollah Seyfi MD of National Iranian Gas Export Company said that "We should try harder to reach the scheduled exploration volume of Iran Qatar joint gas field as soon as possible."

Mr Seyfi noted that the Assaluyeh Siri pipeline project will be definitely carried out. He added that "In case of not reaching an agreement with UAE, the produced gas from Khaf gas deposit of Salman field will be allocated for domestic use."

He asserted that either way the 240 kilometers long pipeline was completely economical.

COMCO of China assess investment in Chabahar

Mehr News Agency quoted Mr Mohammad Taher Baqerizadeh MD of Chabahar free trade industrial zone as saying that an engineering delegation from China’s COMCO Machinery & Equipment Corporation paid a visit to the region and reviewed the possible investment opportunities in the zone, located in southeastern Iran.

Mr Baqerizadeh said that in their 6 day visit, the delegation studied the various industries such as fishery, packaging, warehouse and cold storage buildings and some construction projects. He added that the Chabahar Port is the region’s main port for investment due to its appropriate geographical situation.

Chabahar free trade industrial zone was established in 1992 along with the two other free trade zones Qeshm and Kish Island to use global expertise as a tool for the development of the region, accelerating the completion of infrastructures, creation of productive employment, and representation in the global markets.

It gains importance mainly from its geographical location as the shortest and the most secure route connecting central Asian independent states and Afghanistan to warm waters and its proximity to one of the largest oil, gas and mineral resources of the world and as the only ocean port of Iran.

Iran and Slovenia review joint trade commission setup

Mehr News Agency reported that officials of Iran and Slovenia chambers of commerce in a meet have announced the establishment of a joint trade and economic commission in both sides’ capital cities.

Mr Zedniko Pavcek chairman of the Chamber of Commerce & Industry of Slovenia and Mr Javad Mossadeqi secretary general of Iran’s Chamber of Commerce, Industries & Mines reached agreements on promotion of bilateral relations.

Mr Mossadeqi said that the establishment of the commission will prepare the ground for the sides’ private sectors to increase their activities. He also voiced Iran’s preparedness to cooperate with Slovenia in the field of energy as well as tourism. He added that some 70% of Slovenia’s export bound products are for eastern Asia.

The Chamber of Commerce & Industry of Slovenia represents the business community and provides support and advice to companies as well as a full range of professional services aimed at strengthening competitiveness of its members.

IKCO’s permanent expo opens in Sharjah

Mehr News Agency reported that Iran’s giant carmaker Iran Khodro Company is to inaugurate its permanent exhibition in Sharjah on May 20th 2008.

Mr Alireza Aminifar an IKCO’s sales representative said that the fair aims at showcasing Iran’s car industry potentials and capabilities in the UAE. He added that "By offering services complying with international standards, we are after attracting a considerable number of clients in the UAE car market."

Iran Khodro’s products are supplied to both domestic and foreign markets. The company introduced Iran's first national car, Samand, which has been designed based on the Peugeot 405 platform.

Dana Gas plans to invest over USD 500 million in 2008

Dana Gas PJSC has announced investments of over USD 500 million in 2008 in its projects in Northern Iraq, Egypt and the UAE. Its announced investments for 2008, covering all sectors of the gas industry from the upstream through to the downstream, are expected to realize the value of these strategic positions and further boost revenues over the next stage of Dana Gas’s development.

Mr Ahmed Al Arbeed executive director of Dana Gas said that "This year is an important year for the company, as we will be building upon the important milestones and solid foundations achieved last year, and making major investments that will rapidly take Dana Gas to a new level in its growth and development."

Mr Al Arbeed added that "Dana Gas has already established strong positions in all areas of the natural gas business in the UAE, Egypt and Iraq, and we will continue to build upon these as well as expand into new countries in the GCC Region and North Africa, especially in view of the record oil prices currently witnessed. Our focus this year will be implementing the important projects in the UAE and the Kurdistan Region of Iraq, while significantly expanding the drilling program of new wells in Egypt in light of the encouraging new discoveries we have already achieved."

Dana Gas is currently implementing a major integrated gas project in Iraq’s Kurdistan region on a fast track basis in a record time of just one year, in a 50:50 JV partnership with Crescent Petroleum, at a combined investment of USD 650 million. The project, which involves gas development, production, processing and pipeline construction, is the largest private sector energy project in Iraq, and is already over 80% complete.

First gas production from the project is on target for the middle of this year, building up to a production of 300 million cubic feet per day by 2008 end, approximately twice the company’s current production in Egypt. Dana Gas’s agreements with the Kurdistan Regional Government of Iraq were signed in April 2007 and cover a range of energy related services and the building of substantial infrastructure to process and transport natural gas, as well as the development of the first Dana Gas City.

Tabreed signs AED 1 billion deal for Ijara syndication

Khaleej Times reported that Tabreed has formally sealed a landmark deal with HSBC Amanah, which lead managed and arranged a 12 year Ijara facility for AED 1 billion. The financing will be used to refinance existing facilities as well as support the on going expansion of cooling projects.

HSBC Amanah, acted as the initial mandated lead arranger and following general syndication was joined at the mandated lead arranger level by Abu Dhabi Commercial Bank, Dubai Islamic Bank, National Bank of Abu Dhabi PJSC, and Standard Chartered Bank. First Gulf Bank participated at the lead arranger level, while Abu Dhabi Investment Company, Badr Al Islami and BBK all acted arrangers, with United Arab Bank as a participant.

Mr Abdulla Matar Al Muhairi CFO of Tabreed said that "District cooling is a capital intensive business and requires huge fund inflows. It is one of the leading financial institutions with a global footing and a strong Islamic finance base. HSBC along with other esteemed partners on this Ijara syndication are the top international financial groups in the world with a proven track record. We believe our dedicated efforts combined with undeterred support from our key financers shall further facilitate our expansion plans. This mammoth Ijara syndication is significant as it also reflects the enormous confidence of the banks on us."

HSBC Amanah is the global Islamic banking division of the HSBC Group, and was established in 1998 and has become one of the leading providers of Islamic financial services worldwide. With more than 150 professionals serving the Middle East, Asia Pacific, Europe and the Americas, HSBC Amanah represents the largest Islamic banking team of any international bank.

Real estate market to pick up in September, realtors say

Turkish Daily reported that the real estate sector is facing a credit crunch. As per report, most of the companies in the construction sector accept that the booms in land prices as well as the increase in the prices of iron, cement and steel have led them to experience tough times.

Prices in the secondhand house market have dropped by 30%, which means that an apartment that was worth TRL 200,000 can be purchased for less than TRL 150,000 in cash.

Mr Nabi Cücük chairman of Reha Medin Real Estate Agency said that "The real estate sector will pick up in September 2008 as usual even though it is in stagnation at present."

HR sheet prices decline slightly in Beijing

It is reported that HR coil price declines slightly in Beijing by CNY 30 per tonne to CNY 50 per tonne on May 20th2008.

At present, market price of 3.0mm HRC in 1500mm width from Tangshan Steel is CNY 5,820 per tonne while prices of 5.5mm HRC in 1500mm width and 7.5mm HRC in 1800mm width from Shougang are CNY 5,850 per tonne and CNY 5,800 per tonne respectively.

Meanwhile, in the city of Tianjin, the quotation of HRC decreases slightly as well and now the leading market price is CNY 5,730 per tonne to CNY 5,750 per tonne. For CR steel, market price of 1.0 CRC made in Benxi Steel is around CNY 7,000 per tonne but transactions are not active.

Earthquake has little impact on Chinese coal market - SAWS

According to an official from the State Administration of Work Safety "Wenchuan earthquake has not had an effect on domestic coal supply so far because Sichuan province is a small coal yielding province and in Wenchuan and its mainland there are not many coal mines but smaller ones with limited capacities.”

Although transportation has broken down with the handicapped roads after the earthquake making thermal coal transit to the disaster areas difficult, power plants there have not yet all been revived for use.

The official said the province's limited coal capacity and exports will not hurt the whole market of China. In other places, productions have not been suspended despite strengthening safety check. He said that when the post-disaster construction starts, a large amount of coal will be needed, which will possibly make an impact on the coal supply market.

Currently, almost all coal mines in Sichuan have stopped operation and other provinces influenced by the earthquake are busy with safety check of coal mines.

Zinc drops on LME as Chinese output loss may not cut supply

It is reported that zinc dropped for a first session in three on the London Metal Exchange on expectations losses in output from the worst earthquake in decades in China are unlikely to create a supply shortage.

Macquarie Group Ltd said in a report that about 300,000 tonnes of zinc smelting capacity has been affected by the May 12th 2008 tremor that shook Sichuan and neighboring provinces. That's less than 1% of the country's annual output and may result in production suspension of 15 days or more.

Macquarie analysts led by Mr Jim Lennon and Adam Rowley said in the e-mailed report that this minor cut in supply is unlikely to significantly reduce the surplus that we were forecasting for the zinc market for 2008.'

Zinc fell by USD 50 or 2.1% to USD 2,315 per tonne after rising 9.8% last week. The metal rose as much as 6.5% May 13th 2008 after Beijing Antaike Information Development was reported to have said that the affected output could be as much as 500,000 tonnes.

ArcelorMittal announces donation for victims of Sichuan earthquake

ArcelorMittal is donating over CNY 1 million to the Chinese Red Cross Foundation to help the relief efforts in China following the earthquake that struck Sichuan on May 12th 2008.

ArcelorMittal China and its employees donated CNY 160,000 complemented by a CNY 900,000 donation from the ArcelorMittal Foundation. This represents a total of CNY 1,060,000. In addition to the cash donation, ArcelorMittal is offering to design, technically support and build a new earthquake resistant school for the region

ArcelorMittal China has also encouraged its employees to give blood to support disaster relief efforts as reports from quake stricken areas show blood and plasma products are urgently needed.

Mr LN Mittal Chairman & CEO of ArcelorMittal said that “On behalf of ArcelorMittal, I would like to express my deepest sympathies to all the people affected by this tragedy. As a responsible corporate citizen, ArcelorMittal is committed to offering further support to the Sichuan region for the reconstruction effort.”

Hebei Jinxi Steel supplies 1000 tonne H beams to Sichuan

It is reported that Hebei Jinxi Steel Stock Company Limited contributed 1000 tonne H-beam to Sichuan disaster areas for reconstruction after the earthquake. The first batch of 600 tonnes has been on the way to Sichuan.

Mr Feng Aimin general manager of the company said this contribution valued CNY 6 million is aimed to set up a high quality classroom building in the disaster area. He said that "We are prepared to give a hand any time when the people in the area need us."

Hebei Jinxi Steel was established in October 1986 and listed in Hongkong Exchange March 2nd 2004. As China's first private steel enterprise listed outside the mainland, Jinxi steel boasts comprehensive capacities of pig iron, crude steel and steel product, each for 5 million tonnes. Now it has developed into one of the biggest H-beam bases in China. It is located just in one of the areas once hit by the 1976 Tangshan Earthquake

(Source: Xinhuanet.com)

Anglo American to donate CNY 10 million to China earthquake relief

Anglo American plc announced that it has pledged to donate CNY 10 million (USD 1.4 million) following the earthquake in China's Sichuan province on May 12th 2008.

After consultation with the Minister of Land and Resources, Xu Shaoshi, Anglo American decided to make a donation to help the Ministry's regional units in Sichuan Province recover from the effects of the earthquake. The intention is to help the children who have suffered in the disaster and the Ministry will advise on the most appropriate use of the funds once the needs of the survivors and their families have been determined.

Ms Cynthia Carroll CEO of Anglo American said that “All of us at Anglo American have been deeply saddened by the terrible loss of life caused by the earthquake in Sichuan last week. I offer all those affected our deepest condolences and hope that this donation can play a significant part in aiding the recovery process. Anglo American has, over many decades, been working with friends and partners in Sichuan at all levels of government and society to identify and develop mining projects. We know from our own experience that the people of Sichuan will overcome even this huge tragedy. We share the sense of loss and from our hearts want to make a contribution to all our friends in need.”

Anglo American staff in China and around the world is also contributing personally to the Save the Children fund in order to help bring some immediate relief to the suffering of the many children caught up in this tragedy. Anglo American will match the contributions of its staff. It is a small but hopefully important addition to the recovery process.

Chinese average daily pig iron output hit new high in April

According to China's National Bureau of Statistics, China’s pig iron output totaled 41.267 million tonnes in April 2008 decreased by 262,300 tonnes than 41.529 million tonnes of March 2008 but increased by 3.456 million tonnes or 9.1% YoY.

China's average daily pig iron output hit 1.375 million tonnes in April 2008 setting a new record and registering a 35,900 tonnes increase from 1.339 million tonnes in March.

(Sourced from YIEH.com)

Harsco donates USD 75,000 for China earthquake relief

Worldwide industrial services company Harsco Corporation announced that it is donating CNY 500,000 (nearly USD 75,000) to support the relief efforts in China following the devastating earthquake in Sichuan province.

Mr Salvatore D Fazzolari chairman & CEO of Harsco said that “Harsco has strong ties to China as both a valued customer and as the home of a number of our employees and families. While our operations were not affected, we want to do our part to help those dealing with this enormous situation.”

Harsco’s donation to the Red Cross Society of China is being made through the Company’s Beijing office.

China Tobacco to invest in Coal Chemical Industry

It is reported that China Tobacco Corporation is planning to build a large scaled coal chemical base at Oerhtossu in Inner Mongolia and its total investment in 2008 in this field is expected to reach CNY 5 billion.

The tobacco company has set up in Inner Mongolia a mining company, Shanghaimiao Mining corporation with registered capital of CNY 600 million specializing in coal prospecting as well as in electricity and thermal force.

As per report the mining company will realize an annual capacity of 20 million tonnes and build a 2*30MW thermal power plant in the next five years as scheduled.

(Sourced from MySteel.net)

Metallic silicon price firms up after quake

It is reported that metallic silicon price in domestic market posted an upward trend after quake, and some traders have slightly raised up ex-works price and delivery price to drive up the market.

Productions in Guizhou and Hunan maintain stable. Latest offers keep at CNY 13000 per tonne to CNY 13400 per tonne that for 441 #, CNY 13800 per tonne to CNY 14300 per tonne. Supply for high grade metallic silicon becomes tightened and some traders reported tight availability for 3303 #. Previously contracted supplies also cannot be shipped out on time. Current price for 3303 # stands at CNY 14700 per tonne to CNY 15300 per tonne that for 2202 #, CNY 16100 per tonne to CNY 16300 per tonne.

Hunan-based producers explained that they have given up the production of low-grade metallic silicon due to the spiking raw materials price. Some of them have suspended productions owing to the tight electric power supply. It's forecasted that the price for metallic silicon would advance on a high track.

(Sourced from MySteel.net)

Import quotation of scrap steel and pig iron in China

It is reported that Import quotation of scrap steel and pig iron in China is as under

Price in CNY per tonne

(Sourced from MySteel.net)

Chinalco 800,000 tonnes of alumina projects started recently

It is reported that Xingxian 800,000 tonnes of alumina projects of Chinalco was started on May 16th 2008 at Xingxian in Lvliang city of Shanxi province with a total investment of CNY 5.3 billion which will be completed and put into production in 2010.

The project adopted Bayer production technology, which has the lowest production cost internationally with short process, low investment, low energy consumption, and high quality, which fully applied the latest R & D achievement of Chinalco with its technology and equipment reaching international advanced level.

The project will reach zero discharge of wastewater in the field of environmental protection and desulfation indicators will be better than national standards. When completed, the project could realize an annual gross industrial output value of about CNY 2 billion, CNY 300 million taxation and CNY 550 million profits and tax.

Zinc price to surge due to earthquake in China

It is reported that zinc price of the Shanghai Futures Exchange which plunged from CNY 18,100 per tonne to CNY 17,750 per tonne last week is predicted to rally in the near future due to the influence of the earthquake hitting Wenchuan, Sichuan on May 12th 2008.

According to a report of ATK, nonferrous metal research body in China, after the quake, zinc smelting plants in the area have stopped production and the production of zinc smelting plants with a combined production capacity of 500,000 tonnes in Sichuan, southern Gansu and southern Shaanxi are also affected. Sichuan Hongda, the largest zinc smelting enterprise in Sichuan confirmed recently that its plant in Mianzu suffered a big loss.

Analysts believed that if the transportation in Sichuan can not be improved in the coming two weeks lead zinc smelting plants that have not been affected by the quake will likely be forced to reduce production.

At present, lead zinc ore in Sichuan can not be shipped out of the province for the transport reason.

Baoshan hold Q3 prices announcement

It is reported that Baoshan Iron & Steel has not released the Q3 EXW price on May 20th 2008 as expected and market analysts told Oriental Morning Post that there is no doubt that the delivery price would increase but the steelmaker may need more time to think twice.

As per report Baosteel unveils EXW price on a quarterly basis unlike other steel mills and its price announcement is always considered wane for the steel price trend for following three months.

Market insider said "Baoshan would also refer to global steel prices before hammering out its delivery price. Therefore, current strong price rally in global market would ripple into domestic market."

As a result, Baoshan's Q3 price hike may be smaller than the previous quarter and the price rise for widely used products such as HR, CR may be less than other varieties. In fact, the steelmaker has been criticized by the authority for partly driving up domestic PPI and CPI higher.

(Sourced from MySteel.net)

EC grant NEPT status to 5 firms in castings AD case

European Commission announced that its determination on claim for New Exporting Producer Treatment submitted by Chinese companies in the anti dumping case concerning castings.

Nine Chinese companies requested to be granted NEPT among which seven submitted complete replies and five were granted NEPT.

The companies were attributed the individual duty rates established during the investigation. The two companies which were granted market economy treatment were attributed the 0% dumping duty. The three companies which were granted individual treatment received the weighted average duty of 28.6%. A countrywide duty of 47.8% was imposed on all other companies.

(Sourced from MySteel.net)

North Chinese mills may face production halt for Olympics

It is reported that Chinese steel prices rally would gain further strength from the possible production halts in provinces surrounding Beijing in addition to spiking raw materials costs in the months ahead. The authority is to implement strict environmental protection policy during the Olympics therefore, steel mills in North China might be required to halt or slash production.

Executive from a Hangzhou based steel mill told China Securities News that the company is upbeat about HRC and medium plate price outlook on back of production halt along Beijing-Shenyang Railway during the session of the Games. That would lead to tight supply in the market.

Some market analysts told the newspaper that steel output disruption due to Beijing Olympics may be more of an excuse for market speculation since the real impact may not be as severe as expected.

About 70 steel mills in Hebei province, China have been ordered to control air and water pollution by June 15th 2008 prior to the start of the Olympic Games in August. Failures to do so could result in closure the mills have been warned.

China to reduce iron ore stocks at ports

It is reported that the imported iron ore sitting at major Chinese seaports has reached over 62 million tonnes at the moment and the subsequent port congestion has partially driven up the global bulk shipping rates to an all time high.

Shanghai Securities News reported that the Chinese authority is mulling over measures to drive down the heavy ore stock and put a cap on the freight rates. The move is to increase the leverage for Baosteel during the prolonged ore talks with Australian ore miners.

Some industrial insiders suggest that the government should take quick action to evacuate the heavy ore stock at major seaports and rectify the iron ore market, clamping down on intentional stock build-up and speculative activities.

Mr Luo Bingsheng deputy director of China Iron & Steel Association also noted that Chinese mills are strongly against freight premium demand for contract ore exports and have geared up for possible stalemate of the negotiations.

Baosteel steel sheet houses on the way to disaster area

It is reported that Baosteel personnel, fabricating the first lot of mobile multifunctional color steel sheet houses of 12 rooms, finished them in only 4 days and 5 nights which takes approximately 20 days normally. 2 groups, each with 4 vehicles carrying the first lot left Shanghai on May 17 and 18 respectively for Sichuan disaster area.

Group 1 carries 1 multifunctional system house of 270 square meters and 1 simple color steel sheet house already assembled with 4 rooms each of 14 square meters. Group 2 carries a house of 7 rooms each of 14 square meters. These simple steel sheet houses are featured by good heat preservation, heat & sound insulation, as well as shockproof design. It is estimated that they will arrive at the severely afflicted area Hanwang, Deyang, Sichuan tonight.

As per report Baosteel now is working overtime to race to fabricate steel sheet houses urgently needed by the disaster area. Baosteel will constantly provide steel sheet houses that are shockproof, rain and wind proof and summer/winter-proof as long as they are needed during the reconstruction.

Jiugang starts equipment installation for CRM project

It is reported that recently Jiugang held a ceremony to celebrate the carbon steel cold rolling project launching equipment installation. Representatives from group company, Mitsubishi Corp, Mitsubishi Hitachi Corp and other concerned parties attended the ceremony.

Carbon steel cold rolling project is one of the key projects for Jiugang to implement the product mix upgrading. Adopting 1.5 million tonnes per year 5 stand pickling and continuous rolling machine designed by Mitsubishi Hitachi Corp of Japan, and two 750,000 tonnes per year hot dipped galvanizing machines designed by Nippon Steel Company, and affiliated post processing line and common supplementary facilities, the project is expected to be completed in 33 months.

BERIS Engineering and Research Corporation will take responsibility of plant design.

ENRC to build railway line between Kazakhstan and China

Eurasian Natural Resources Corporation PLC, the holding company of a leading diversified natural resources group based in Kazakhstan, announced that ENRC Logistics has won the Kazakhstan State tender for the China Gateway Project.

The China Gateway Project will involve the construction of approximately 300 kilometers of railway in South-East Kazakhstan, which ENRC will subsequently operate.

1. A single track railroad will be constructed between Zhetigen in the Republic of Kazakhstan and Khorgos on the Kazakhstan-Chinese border.

2. Four intermediate stations, ten intersections, and a loading complex will also be built as part of the project.

Mr Johannes Sittard CEO of ENRC said “We are proud to be involved in this great project. The new railway will facilitate the increase in cargo carried between Kazakhstan and China by up to 30 million tonnes per annum. It will provide ENRC’s operations with an additional secure transportation route and with an increased capacity for products to be sold into the growing Chinese market.”

The USD 900 million capital expenditure projects will be the largest ever private investment in Kazakhstan’s transport infrastructure. Construction will begin later this year and it is envisaged that the railway will commence operations in 2012. ENRC’s concession to operate the railway will run until 2036. The realization of the project will enable ENRC to improve the delivery of its products to customers in China, diversify the activities of ENRC Logistics and enhance profitability by offering services to third parties.

CNOOC to donate CNY 500 million for earthquake relief

It is reported that China National Offshore Oil Corp the country's largest offshore oil producer plans to donate CNY 500 million over five years for post quake reconstruction.

CNOOC's said in a statement that it will donate CNY 100 million each year and the money will mostly be spent on public services facilities such as schools and hospitals.

The statement said large State owned companies should pay more attention to their corporate social responsibility work in hard times such as these and the company has already donated over CNY 30 million since the earthquake.

CNOOC, China National Petroleum Corp and China Petrochemical Corp are the country's three leading oil producers. CNPC and Sinopec have both chipped in for the relief work as well.

Scrap price increase further in Shandong

It is reported that scrap market in East China's Shandong rose up further. And Laiwu Steel a leading steelmaker in the province has raise up purchase price further by CNY 100 per tonne with latest price offered at CNY 3950 per tonne for No 1 heavy scrap, CNY 3910 per tonne for No 2 heavy scrap and CNY 3868 per tonne for small scrap.

The price hikes in Shandong will inevitably drive up the market nearby.

Mysteel attributes the price rise to scant supply and low inventories, and this condition would continue in days to come. However, the latest slack transactions in steel market weigh on the scrap price rise.

Mysteel believes that scrap market would maintain strong operations in short term in the province.

(Sourced from MySteel.net)

Severstal proposes to acquire Esmark Incorporated

OAO Severstal one of the world's leading metals and mining companies announced that it has made a proposal to the Esmark Incorporated Board of Directors to acquire all of the outstanding shares of common stock of Esmark for USD 17.00 per share in cash.

Severstal is best positioned to optimize the value of Esmark by creating complementary product lines, geographical alignment and operational synergies. Further, Severstal has developed a highly credible restructuring plan designed to derive maximum value from Esmark, including a 5 year capital improvement plan that carries the full support of the United Steelworkers. Together, the combined company will become one of the North American leaders in flat rolled steel products.

Severstal’s proposal follows the April 30th 2008 announcement by Esmark of its agreement to be acquired by Essar Steel Holdings Limited and the May 16th 2008 announcement by the USW of its rejection of such a transaction. As part of its announcement, the USW demanded that Esmark repudiate the transaction agreements with Essar Steel, which were entered into in violation of the USW's right to bid provisions contained in its collective bargaining agreement with Esmark. The USW has further indicated that under another section of its labor agreement the successor ship clause Esmark and Essar Steel cannot close their proposed transaction unless Essar Steel enters into a new labor agreement with the USW. The USW stated in its announcement that it will use such power to block the Essar Steel transaction.

In contrast to the proposed Essar Steel transaction, Severstal's proposal has the full and enthusiastic support of the USW. Severstal and the USW have also entered into an agreement that satisfies the successor ship clause of the labor agreement.

Mr Gregory Mason CEO of Severstal International and COO of OAO Severstal said that "While we hope to work together with Esmark and its board of directors to negotiate a mutually acceptable merger agreement, we believe that it is critical to give Esmark's stockholders a chance to decide for themselves and that they will find Severstal's proposal much more compelling than the Essar Steel transaction."

Severstal indicated in its letter that its proposal could be consummated within 40 days after entering into a merger agreement with Esmark.

Merrill Lynch is acting as lead financial advisor Citi is acting as financial advisor and Skadden, Arps, Slate, Meagher & Flom LLP is acting as legal counsel to Severstal.

MMK Q1 net down by 22.6% YoY

Magnitogorsk Iron and Steel Works announced its financial results under US GAAP for the Q1 of 2008

Highlights for the Q1 result

1. Crude steel output at MMK grew by 8.1% compared to Q4 2007. Finished steel products output increase by 5.8% and amounted to 3,287,000 tonnes.

2. Following the international market trends, average price for Q1 2008 grew by 9% and paved the way for even stronger growth in April to May 2008.

3. Sales of MMK parent company rose by 11.7% and amounted to USD 2.188 million. At the same time total MMK Group sales amounted to USD 2.169 million up by 6%.

4. The reason for parent sales to exceed consolidated MMK Group sales is the delay of goods in transit on their way to end customers. The delay was caused by adverse weather conditions at export seaports which resulted in decreased revenues of MMK Group traders.

5. Earnings were affected for the same reason e.g. MMK Q1 2008 EBITDA amounted to USD 504 million which is quite in line with Q4 2007 result of USD 506 million. At the same time consolidated EBITDA of MMK Group for Q1 2008 is USD 465 million.

6. Operating income of MMK Group came to USD 393 million down by 13.2% compared to Q4 2007.

7. Consolidated net income of MMK Group for Q1 of 2008 down by 28.5% totaling USD 271 million, net margin coming to 12.5%. Net income decrease is accounted for by a one off income tax which was accrued because of change in functional currency.

8. Comprehensive income for Q1 2008 amounted to USD 477 and includes revaluation of Fortescue Metals Group shares and the effect of functional currency change.

9. Despite significant growth of raw materials prices, MMK Group EBITDA margin shrank by 4 points only to 21.4%.

10. Financial condition of MMK Group is characterized by high liquidity levels and low dependence on external financing.

11. Acquisitions of property, plant and equipment, as well as subsidiaries and affiliates in Q1 2008 amounted to USD 733 million.

Metalloinvest plans autumn IPO --report

Reuters reported that Mr Alisher Usmanov's Metalloinvest plans to float up to 25% of its shares in an initial public offering in the autumn.

Vedomosti business daily quoted banking sources as saying that Metalloinvest has picked Merrill Lynch, Credit Suisse and Deutsche Bank to organize the placement. The location has not yet been decided but New York is under discussion.

Vedomosti said Metalloinvest hopes to increase around USD 3 billion initially by offering a 10% stake in the company. Its existing shareholders will sell another 15% of the company in proportion to their current stakes.

Metalloinvest declined to comment on the report.

Metalloinvest manages the assets of holding group Gazmetall which includes Russia's two largest iron ore mines and two steel mills that rank the company fifth in terms of output.

EU scraps tariff on electrical steel from NLMK

Bloomberg reported that the European Union scrapped an 11.5% electrical steel tariff against Novolipetsk Steel increasing competition for EU producers, such as Germany's ThyssenKrupp.

EU said the merged entity's structure and prices no longer justify the trade protection which imposed the duty in August 2005 for five years. Novolipetsk and VIZ Stal were Russia's only known exporters to the EU of