May, 27 2008
TATA Steel to begin work at Orissa plant in 2 months
PTI reported that TATA Steel will begin construction work at its proposed 6 million tonne steel plant at Kalinga Nagar in Orissa in the next 2 months.
Mr Sanjay Choudhry chief of corporate communication of TATA Steel said that "Pre fabrication work has already started while actual construction will commence in two months time frame." He added that the preparatory work including soil testing, site clearing and fabrication of the steel rolling mill is being carried out.
TATA Steel has been planning the Greenfield project in Orissa at an estimated investment of about INR 22,000 crore since 2004 but the slow pace of acquiring land and environmental clearances delayed it.
TATA Steel needed about 3,200 acres for plant's construction while another 400 acres for its rehabilitation colony. The land has been acquired. It claims to have shifted 700 families out of the total 1,100 falling in the purview of its plant site to its newly built rehabilitation colony.
TATA Steel has also placed work orders for purchasing machinery and equipments including blast furnace, sinter plants and slab caster for its Orissa unit. Post completion of the plant's construction, it plans to commence commercial production in 2 phases of 3 million tonne each in next 36 to 40 months.
TATA Steel also proposes to set up two Greenfield steel projects of 5 million tonne and 12 million tonnes capacity each in Chhattisgarh and Jharkhand also.
SAIL identifies 71 projects for carbon credits
PTI reported that, amid rising threat of global warming, Steel Authority of India Limited has identified over 71 potential projects for availing carbon credits.
As part of the first phase, SAIL has awarded consultancy for 38 projects. These projects would cover the energy intensive operations in coke ovens, sinter plants and blast furnaces of SAIL units. In second phase, it plans to schedule the rest 33 projects, which would focus on basic oxygen furnaces, rolling mills and downstream operations.
SAIL has already registered one project LD gas recovery from Steel Melting Shop-II for power generation at Rourkela Steel Plant for carbon credit. Carbon credit is issued by clean development mechanism executive board for emission and reductions achieved by CDM projects and verified under the rules of Kyoto Protocol.
Total 295 Indian companies are registered with CDM for carbon credits. India is the second largest seller of carbon credits in the global market, with 6% share in 2007.
BPSL starts CSP Roller hearth furnace Line A at Orissa plant
It is reported that Tenova LOI Italimpianti has successfully commissioned the Roller Hearth Furnace Line A supplied for the CSP Bhushan Power & Steel Ltd in Orissa India.
The Roller Hearth Furnace is complete with Swivel system for the future installation of the Line B in accordance with the expansion program of the BPSL plant.
The top and bottom fired furnace, able to handle a wide range of steel quality, is equipped with the most recent and innovative technical solutions for this kind of plants, thus warranting top performances.
Beyond this furnace, which is the first LOI Italimpianti CSP reference in India, LOI Italimpianti can also boast the roller hearth furnace for the line B in Bhushan Power & Steel and two roller hearth furnaces at new CSP mill for Essar Steel.
MHD based fuel saving devices for steel and power sector
It is reported that, amid the spiraling prices of fuel and energy, NOIDA based Dynatech Engineers, authorized distributors and export agents of AM Pollution (Engg) Research Pvt Ltd of Kolkata, has successfully commissioned their revolutionary energy saving device in several installations.
The device named Unimag® uses the “Quantizing Magnetic Effect” based on the principles of Magneto Hydro Dynamics. The device can not only reduce costs due to water conservation, energy savings and reduced maintenance, but also improve environmental discharges which can also be leveraged through carbon credits.
They have been successfully used for on line prevention of scale deposition in process water system, carbon deposition in carbonaceous fluid carrying system as well as liquid fuel saving along with reduced emission of pollutants in the steel industry.
As per release, they can be used in the header of BF Cooler collectors, individual inlets of BF Coolers and in the total water supply line in BF area. In the area of steel melting shop, they can be used in water cleaning circuit of the converter gas cleaning plant and other places. They can also be used in coke ovens, mines and for reducing refractory consumption.
As per release, in case of liquid fuel combustion systems, the benefits include fuel saving of 5% to 7%, reduction of black smoke emission by up to 35%, longer engine or furnace life by decarburization and maximization of CV of fuel input.
In case of carbonaceous fluid carrying system, the release said that it eliminates and prevents deposition of carbon or varnish in the COG, BFG distribution system and also decarbonizes injectors, burner nozzles etc.
Interested readers may send a mail to know more details at research@steelguru.com
Essar Steel reaffirms interest in PT Krakatau Steel
Reuters reported that India's Essar Steel Ltd affirmed that it is still considering buying a stake in Indonesian state steel firm PT Krakatau Steel and is awaiting a privatization plan for the company.
A spokesman for the diversified Essar group said Essar Steel had submitted an expression of interest. He added that "We are not aware of any formal process of privatization. If and when the process is initiated, we will examine such opportunity.”
Villagers to oppose ArcelorMittal steel project in Orissa
SNS repotted that on the eve of the first workshop and interaction organized by ArcelorMittal, villagers of Patna held a meeting vowing the oppose the project. Villagers said that "We will not leave our land nor are we willing to lose our livelihood."
The meeting held under the banner of All India Krushak Kshet Mazdoor Sanghathana and was addressed by state secretary of the organization Mr Raghunath Das, SUCI leader Mr Sambhunath Nayak, MLA and Mr Rushideba Nayak.
All India Krushak Kshet Mazdoor Sanghathana demanded scrapping of the MoU between the state government and Mittal should be cancelled. It has also demanded irrigation facility to all farm land in the area, work to the labor class and BPL cards to the poor families in the area.
Meanwhile, ArcelorMittal has invited villagers, NGOs, government officials and others to the workshop to discuss its rehabilitation package, corporate social responsibility plans and seek views from the public on what more can be done for local area development.
For the proposed project, ArcelorMittal has sought a total of 4,518.988 acres of private lands under Patna Tehsil. It requires 6000 of cares for the mega steel plant, 1000 acres for a power plant, 750 acres for a township and 755 acres for a reserved forest area.
Vedanta in talks with partners for Orissa steel plant
BL reported that Vedanta Group is in talks with 3 potential partners for jointly setting up a 5 million tonnes steel plant in Orissa's Keonjhar district with an investment of INR 7,000 crore to INR 8,000 crore.
Mr Anil Agarwal chairman of Vedanta Group said that "We are talking to one Japanese company, one European company and one Indian company for partnering with us for the steel project."
He added that it is not averse to giving a majority stake to the partner.
Mr Agarwal said that the proposed steel project could use the iron ore mined by Sesa Goa.
Esmark shareholders back USW stance against Essar
It is reported that Essar Steel’s chances of acquiring US based integrated steel company Esmark are getting slimmer by the day as Esmark’s shareholders have joined Esmark workers’ union to block Essar and support rival bidder Severstal.
Franklin Mutual Advisors, which represents the Esmark shareholders, has told the board that a quick decision on the Severstal offer will maximize shareholders’ value.
In a letter written to the Esmark board, Mr Peter Langerman CEO of Franklin Mutual Advisors said that "While Essar and Severstal have each offered USD 17 a share, headline dollar amounts cannot be the end of the analysis. It goes without saying that transaction certainty and timing to closing are critical components of value, and in this respect the two proposals could not be more different. As you know well, in contrast to the Severstal proposal, the Essar proposal is subject, at the least, to the expiration of USW’s lengthy right to bid period and as the USW has repeatedly made abundantly clear, the union intends to enforce that right and other rights it asserts to block the Essar transaction."
According to FMA, It is difficult, if not impossible for Essar to overcome the opposition. It said that "It is our judgment that this inescapable element of the Essar proposal, both because of the delay it will involve under the best circumstances, as well as the serious level of uncertainty it poses to the ultimate consummation of the deal, represents a very significant infirmity of the Essar transaction that could only be cured by obtaining USW support."
Essar had on April 30th 2008 announced its intention to acquire the entire share capital of Esmark for USD 17 per share, totaling USD 668 million. It had also extended a USD 110 million loan to Esmark to restructure its debt. Interestingly, the Esmark board approved Essar’s bid. However, it failed to reach an agreement with Esmark’s trade union, the United Steelworkers Union. If the deal with Essar does not materialize, Esmark will have to pay a break up fee of USD 20 million.
Midhani may form a JV with VSMPO Avisma for titanium plant
It is reported that Hyderabad based Midhani and Russia's VSMPO Avisma are planning to form a JV company to produce value added products from titanium sponge.
Mr M Narayana Rao CMD of Midhani said that discussions between Midhani and VSMPO Avisma are in an advanced stage for the venture. He added that "Plan was that the Russian Corporation would supply the titanium sponge and we will convert it into value added products."
A joint working group has been formed by the union ministry of defense to work out the feasibility of the proposed venture. It is estimated that under the proposed venture about 10,000 tonnes per annum of titanium sponge could be converted, which will generate a turnover of about INR 3,000 crore. A separate manufacturing plant will be established.
The finished titanium sponge products will then be produced to meet the demands of the Indian market and also be exported to global markets through the JV.
Indian port traffic to rise by 10% to 12% - ICRA Report
It is reported that Indian port traffic is set to grow at the rate of 10% to 12% per annum over the next 5 years with the overall traffic of the major as well as the minor ports being projected at 1,008.95 million tonnes by 2012 up from 588.63 million tonnes in 2006-07.
A study by ICRA said that the rise in port traffic would be fuelled by high growth in merchandise exports driven by a buoyant world economy and higher oil and coal imports. The growth potential of the Indian ports would hinge on growth in world output, world trade and maritime trade.
The report observes that the composite capacity of all the major ports rose by 52.4% in 2006-07 mainly on the back on enhanced productivity. With the infusion of new technologies and capacity building, the congestion in the Indian ports has witnessed reduction in most places and operational efficiency has also improved leading to capacities being marginally ahead of demand.
However, with the projected growth of traffic and growing containerisation, there is a need to expand capacities of ports further through investment from public and private sectors. In all, 276 projects have been identified for all the major ports which entail an investment of INR 588.04 billion. These projects include development of new berths, expansion and upgradation of existing berths, deepening of channels, equipment modernization and up gradation of rail and road connectivity.
The ICRA study has pointed out that the trend in global shipping has rapidly shifted towards deployment of large sized vessels requiring deeper draft at ports and highly efficient modes of cargo discharge to minimize detention time. The average turnaround time for ships at the major ports has gone up to 3.79 days as compared to 13 hours at Hong Kong port and 16.5 hours at the Colombo port.
According to the study, increasing competition is reducing margins of ports and affecting their ability to achieve economies of scale. In addition to adding deep draft at ports and incorporating the latest in handling equipment, maintaining highly trained manpower and value added services also play a crucial role in port development.
Jai Balaji takes eco friendly initiatives for green environment
It is reported that Jai Balaji Industries Limited has taken a series of initiatives to ensure protection of environment.
Its power plant is running on Aircool technology, thereby saving precious water and significantly contributing to prevention of environment degradation.
Jai Balaji Industries Limited has now undertaken a program for continuously planting trees in and around the plant vicinity and in nearby villages.
Jai Balaji Industries Limited was the first company in steel sector in West Bengal to be registered with United Nations Framework Convention on Climate Change and hence became eligible for carbon credits.
Surya Sponge shut down plant at Budhakendua in Orissa
SNS reported that the management of Surya Sponge Iron Limited has closed down its plant located at Budhakendua after Orissa State Pollution Control Board served a closure notice it for not taking appropriate measures to check air pollution and removal of solid waste.
Earlier, Orissa State Pollution Control Board, Cuttack Regional office had issued a closure notice to SSIL for violating the Air & Water Pollution Act.
In the closure notice, issued by the Orissa State Pollution Control Board, the SSIL had been charged with violating under section 31(A) of the Air Prevention and Control of Pollution Act, 1981 and 33 (A) of the Water Prevention & Control of Pollution Act, 1974. The sponge iron plant was also accused of not having a legal site for dumping of solid waste that is polluting the water bodies.
The board waited for 6 months and finally decided on closing down the unit, which has 4 DRI furnaces, 2 of 40 tonne per day and 100 tonne per day each.
Indian steel makers steps to ensure raw material security
1) The ministry of steel had proposed for a special purpose vehicle that would be promoted jointly by several public sector companies to acquire coal mines and assets abroad. The SPV would involve the participation of SAIL, RINL, NMDC, NTPC and Coal India Limited.
2) SAIL, RINL, CIL, NTPC and NMDC signed a MoU on August 3rd 2007 for coal SPV. Cabinet approved this proposal on November 8th 2007. The SPV has been set up as Coal Ventures International.
Indian Railways proposes INR 200,000 core facelift plans
Exim News Service reported that Indian Railways has proposed to invest INR 200,000 crore in modernization, capacity augmentation and completion of projects during the 11th Plan.
Mr Lalu Prasad Yadav union railway minister, while addressing students and faculty members of International Business School Singapore, said that Indian Railways had taken a decision to use the public private partnership model in the non core sector to set up logistics parks, wagon investment schemes, wagon leasing schemes, and manufacturing of wagons, coaches and locomotives.
Mr Yadav added that also, 26 major railway stations will be upgraded to world class standards. They would have multi level parking lots, malls and waiting rooms. He claimed that following a surplus of INR 25,000 crore in 2007-08 and with an operating ratio of 76%, Indian Railways had achieved a better record than several top Fortune 500 world companies.
Indian steel ministry update on R&D efforts in last 4 years
1) Financial assistance provided to encourage R&D activity in iron & steel sector. 59 research projects of approved so far at a cost of INR 500 crore. Results of the completed R&D projects were gainfully utilized by the industry wherever applicable.
2) INR 118 crores allocated during the 11th five year plan for promotion of R&D in steel sector 11th plan for steel sector Scheme for promotion of R&D in the Iron & Steel Sector with budgetary provision of INR 118 crore.
3) Steel Research & Development Mission to be set up where path breaking R&D will be done. All major producers will fund the mission.
4) Steel Technology Centre at IIT, Kharagpur to promote R&D in iron & steel sector approved, at a cost of INR 22.26 crores for 5 years.
5) Initiatives under Clean Development Mechanism, Host Country Approval to 60 proposals from the iron and steel plants in India accorded which will result in green house gas abatement worth 66 million tonnes of CO2 equivalent and earn certified emission reduction units.
India shipping firms add fleet on rate spike and demand
BL reported that Indian shipping firms are expanding their fleet size and buying larger vessels to cash in on record freight rates, hoping their revenues to swell in 2008-09.
As per report, Shipping Corporation of India Limited will invest USD 3.5 billion to buy 68 new vessels and has placed orders for 28. Great Eastern Shipping, Mercator Lines, Varun Shipping, among others also have such plans.
Mr Harish Mittal executive chairman of Mercator Lines said that "The dry cargo, tankers segment are all very high growth businesses. We are anticipating demand, and the rates too to continue to be firm for at least the next 2 to 3 years."
Mercator has earmarked USD 1 billion CAPEX over 2 years and has already ordered a very large crude carrier and two dry cargo vessels. Industry officials and analysts are expecting at least 20% to 35% return on equity in 2008-09 on these new assets.
Mr Yudhishthir Khatau director of Indian National Ship owners' Association said that "Contribution of larger ships is large. The end user sees a major gain as he gets a cheaper cost per tonne. If you take a large vessel, the turnaround time cargo loading, berthing, un berthing time is reduced."
In 2007-08 fiscal, Indian ports handled 519 million tonnes cargo up by 12% YoY. Throughput at Jawaharlal Nehru Port trust was 55.8 million TEUs up by 23% YoY. Large vessels would add pressure on terminals, in terms of draft or depth of waters, loading or unloading efficiency, storage areas and ease of operations.
RIL to pick up 50% stake in Rewas Port connectivity project
Reliance Industries Limited is planning to pick up 50% stake in Rewas port connectivity project of Indian Railways. It will invest INR 700 crore in the 25 kilometers long railway link between Pen station and Rewas port.
The proposed connectivity project is planned as an important freight link for RIL's 35,000 acre Navi Mumbai SEZ and will be one of the first rail links to pass through 8 kilometers of backwaters in the Arabian Sea.
Rail Vikas Nigam Limited is expected to clear the project on May 24th 2008 and the JV for the port connectivity project will be signed between RVNL and RIL.
Kerala CM to dedicate Neryamangalam Power to the nation
PTI reported that Mr VS Achuthanandan chief minister of Kerala would dedicate the 25 MW Neryamangalam extension hydel power project in Idukki district to the nation.
Mr AK Balan state power minister said that the project, conceived in 2001 during the previous LDF government, was completed in a time bound manner after a brief halt in work at a cost of INR 45 crore.
The renovation of the 35 year old 300 MW Sabarigiri hydel project was being implemented in a phased manner. The government had effectively dealt with the recent power crisis during peak load time and there would not be any more load shedding in the state.
The government was awaiting report from the expert committee on the re organization of the electricity board as companies as directed by the union government and would request the centre to give time till next year for its implementation.
Kerala would get coal from Orissa for power generation as per an agreement with a company chaired by Orissa Hydro Power Corporation chairman. The cabinet had approved the memorandum of association, articles of association and share holding agreement with the company.
FICCI warns against government approach on inflation
Advising the government against a knee jerk approach to tackle inflation, Federation of Indian Chamber of Commerce & Industry has said that industries should not be arm twisted to reduce prices in sectors like steel and cement.
Mr Amit Mitra secretary general of FICCI said that measures like export duty on steel would not only reduce the revenue figures of manufacturers but also make Indian firms uncompetitive in the global arena. He added that "Our position is that if the government wants the steel industry to globalize and create markets abroad on a steady basis, it has to be allowed to put more value into higher grade products which are exported."
FICCI had earlier demanded that besides withdrawing the 5% to 15% export duty on steel, the government should also desist from asking cement manufacturers to keep prices below a threshold.
Mr Mitra said that there has to be a balance between market forces and inflationary pressure within India. He added that "We cannot compete with China on basic steel as they import our iron ore and produce steel at much cheaper price."
BHEL wins USD 270 million order
It is reported that Indian state run equipment maker Bharat Heavy Electricals Ltd had won an order worth INR 11.5 billion (USD 270 million) for setting up a 153 MW power plant at the upcoming Guru Gobind Singh Refinery at Bhatinda in Punjab. The prestigious order has been placed by HMEL, a joint venture of HPCL and Mittal Energy Ltd.
BHEL's scope of work in the project envisages design, engineering, manufacture, supply, erection and commissioning of the captive power plant, in addition to complete civil works.
The equipment for the project will be supplied by BHEL's plants at Hyderabad, Trichy, Ranipet, Bhopal, Jhansi and Electronics Division, Bangalore.
The gas turbine-based combined cycle power plant is to be commissioned in 30 months
IMFA organizes free health camp
Indian Metals & Ferroalloys Limited has organized a free health camp and distributed free clothing at Jinjilbadi school under Kolanara block recently.
As many as 140 elderly people of Jinjili badi Buduni and nearby villages were given free health check up and medicine. Chief medical officer of IMFA Dr S R Mishra and Dr PK Kar examined the patients. Mr Mr Dhananjay Senapati GM (operations) at IMFA distributed free clothing to the villagers.
About 124 villagers were benefited through this program.
Reliance Power and GMR to bid for Singapore power plants
BS reported that Reliance Power and GMR Infrastructure are planning to bid for PowerSeraya and Senoko Power, which account for more than 60% of the power produced in Singapore.
The Singapore government controlled Temasek Holdings, which controls over 90% of power generation and distribution in Singapore, will soon call for bids to privatize the two companies. The Indian companies are exploring various options to bid for these assets.
Senoko Power generates about 3,300 MW and PowerSeraya, with annual revenues of about SGD 2.6 billion in 2007, has 3,100 MW of installed capacity, with many power generating assets located at Jurong Island. It controls 28% of Singapore's energy market and has also diversified into oil storage, desalinated and cooling water solutions, energy trading, fuel management and bunker fuel blending and tank leasing.
Mr Megen to take over as CEO of Suzlon Energy
Suzlon Energy Limited announced that Mr Toine van Megen will take the position of CEO effective May 24th 2008 replacing Mr Andre Horbach who resigned for personal reasons.
UP power regulator issues notice to Lanco over Anpara project
BS reported that Uttar Pradesh State Electricity Regulatory Commission has issued notice to Lanco Anpara Power Private Limited on a petition challenging the change in capacity of the Anpara C thermal power project from 1,000 MW to 1,200 MW. The project, located in Sonbhadra district, is already behind schedule by eight months.
Lanco's application for increase in the capacity was approved by the UP government on August 20th 2007. However, in its order, the state government had said that Lanco would need the power regulator's approval to increase the capacity. But the application seeking permission from the regulator was moved by Uttar Pradesh Power Corporation Limited.
The regulator asked the UPPCL to submit a legal opinion whether the enhancement of the capacity would be lawful. The UPPCL, instead of replying to the regulator's query, decided to withdraw the petition seeking increase in the capacity.
In a petition to the power regulator, the petitioner Mr Arvind Kumar Singh has sought quashing of the award of contract to Lanco Anpara Power Limited. The petitioner has also asked the regulator to issue directions to invite fresh bids for the revised capacity or alternatively, direct Lanco to reduce the tariff by 20%.
The Anpara C project, touted as the first thermal power project to be awarded on tariff based competitive bidding, was won by Lanco Kundapalli after outbidding Reliance Energy Limited and Essar Energy Limited in June 2006. The company won the contract by quoting the lowest price of INR 1.91 per unit for the power to be generated at Anpara C.
The letter of acceptance was issued to the company on September 26th 2006, during the previous regime of Mr Mulayam Singh Yadav. According to the contract, the company is required to complete the project within 39 to 42 months of the issue of letter of acceptance.
Gujarat plans five major power plants
BS repotted that Gujarat government is planning to invite private companies to invest in 5 new power projects worth INR 20,000 crore during the upcoming Vibrant Gujarat Global Investors' Summit.
The MoUs for 5 new projects totaling a capacity of 5,350 MW are likely to be signed during the Vibrant Gujarat summit. The state's present installed capacity is over 9,000 MW against the unrestricted power demand of 11,500 MW.
The upcoming Vibrant Gujarat Global Investors' Summit would see MoUs being signed for several power projects, including 1,000 MW coal based power plant in Chhara Sarkhadi in Kodinar, 1,000 MW coal power plant in Simar in Junagadh, 1,000 MW LNG coal based power plant in Vansi Borsi in Surat, 1,000 MW coal LNG based plant in Dahej in Bharuch, 1000 MW coal based power plant in Veera in Kandla in Kutch and a 350 MW expansion of gas based power station at Mora in Surat.
Leading power companies, including Essar, Adani, Torrent and government owned companies like GUVNL, are already on way to create power infrastructure to generate additional 11,164 MW. This would take the total installed capacity of the state to 20,000 MW by 2012. However, according to the EPS survey, the state's peak demand would be 18,500 MW by 2017.
According to the 16th Electric Power Survey carried out by the Central Electricity Authority, the demand is likely to grow to over 14,000 MW by 2012. The state would require an installed capacity of 18,700 MW by 2012 to meet the growing power demand. The state government has planned to add 11,164 MW by then.
MP wants links to Delhi Mumbai industrial corridor
BS reported that Madhya Pradesh has asked for fast and efficient rail links to markets and ports under the proposed Delhi Mumbai Industrial Corridor. It has proposed the creation of the Pithampur Dhar Mhow mega industrial region over at least 200 square kilometer, where an apparel park, a gem & jewellery park, a software technology park, a herbal park and clusters for pharmaceutical firms, textiles, food processing and auto components will come up.
The state government has said that there is an urgent need to expedite the gauge conversion of the Neemuch Ratlam track of 135.38 kilometers to strengthen transport linkages of the Neemuch Nayagaon industrial region and Ratlam Nagda mega industrial region with Ajmer, Jaipur, the National Capital Region of Delhi, Ahmedabad, Vadodra, Surat and Mumbai. It added that fast and efficient connectivity with ports in Maharashtra and Gujarat is equally important.
Similarly, the government has pointed out that the existing meter gauge rail route between Indore and Khandwa, which is connected to the age old Ajmer Hyderabad meter gauge rail route, should be converted into broad gauge quickly.
A highly placed source in the state department of industries said that "It is essential to complete the ongoing Dahod Sardarpur Dhar Indore broad gauge new line at a fast pace to ensure better connectivity to the Pithampur Dhar Mhow mega industrial region and the Shajapur Dewas industrial region with cities of Vadodara, Ahmedabad, Surat and parts of Kandla, Mundra, Pipapav, Bedi in Gujarat."
The source further added that "The conversion of the existing Pratapnagar Chhota Udepur narrow gauge line into broad gauge in progress and the construction of a new line from Indore to Chhota Udepur via Dhar and construction new Dhar Indore broad gauge line is in progress but linkage between Dhar and Chhota Udepur has yet to be taken up.
Kerala to cut transmission loss to 15%
BL reported that Kerala State Electricity Board is taking steps to cut transmission loss to 15%.
Mr AK Balan state electricity minister said that the board had been able to reduce the transmission loss to 20% and this would be further brought down to 15% to match international standards.
BHEL Q4 net down by 3% YoY
Bharat Heavy Electricals announced that the net profit for the fourth quarter ended March 31st 2008 dropped by 3% YoY to INR 1,110.87 crores from INR 1,150.37 crores as compared to Q4 of 2007. Total income grew to INR 7, 626.20 crores from INR 7, 205.70 crores in the year ago quarter.
BHEL posted net profit of INR 2,859.34 crores for the year ended March 31st 2008 as compared to INR 2,414.70 crores in the previous year. Total income grew to INR 20,761.69 crores from INR 17,999.00 crores in the year ago.
Esmark sees best possible partnership in Essar Steel
Mr Jim Bouchard chairman of Esmark recently said that management and the board of directors see India's Essar Steel Holdings as the absolute best partner for the company, faced with spiraling raw material costs and a constricted credit market.
Mr Bouchard said that “Essar has international business muscle and ample financial resources as well as low cost access to key raw material supplies, something Esmark sorely needs. It also is willing to invest millions in Esmark's steel operation, Wheeling Pitt and has lent the company USD 110 million so it can retire a USD 79 million federally guaranteed loan that enabled the steelmaker to emerge from bankruptcy protection in 2003.”
He added that "We believe we have selected the absolute best partner for this company and Wheeling Pitt to take it into the decade in front of us. They have nothing but growth plans for the company going forward.”
Displaced persons seeking benefits from Utkal Alumina
PTI reported that, seeking enhanced compensation, jobs and other benefits, people displaced due to setting up of the Utkal Alumina Company in Orissa's Rayagada district have threatened to stall industrialization in the area if their demands were not fulfilled soon.
Mr Chitrasen Naik secretary of the committee of displaced and affected families said that "If main demands of displaced people, mostly tribal and Dalits are not met, we will stall industrialization and start farming in acquired agriculture land."
Demanding INR 1 million compensation for every acre of acquired agriculture land for the project, he said that though the displaced people in Kashipur block of the tribal dominated Rayagada district had been agitating for a long time, the issue remained unresolved. Similarly, INR 500,000 should be given for every acre of barren land and cases against displaced disposed of forthwith. Every displaced person in the project area should be provided with permanent employment.
Regretting the company's refusal to provide further assistance to project affected people, he said that affected families would not be able to benefit from the revised resettlement & rehabilitation policy of the Orissa government as the lands had been acquired much before it came into being.
Two Chinese firms and BHEL in race for Haldia power project
It is reported that two Chinese power equipment companies namely DongFang Electric and Sepco Electric Power Construction, along with Bharat Heavy Electricals Limited, are in the race for the INR 2,400 crore EPC contract for CESC Limited's 600 MW coal based power project at Haldia in Midnapore district of West Bengal.
CESC is in talks with Power Grid Corporation of India Limited to set up an 80 kilometer overhead transmission link for evacuating the Haldia generation. The transmission project will cost nearly INR 120 crore and will link the Haldia power plant with the CESC system through PPGCIL's Subashgram sub station in South 24 Parganas.
CESC is awaiting clearance from the ministry of environment & forest and the project is likely to start generation in 36 months after receiving clearance.
Government approves tender bid for NTPC by BHEL & Alstom
BL reported that Indian government has cleared a proposal wherein Bharat Heavy Electricals Limited and its partner Alstom Power will participate in the bulk tendering by National Thermal Power Corporation for super critical technology.
It is learnt that NTPC may go in for bulk tendering of seven units 660 MW each with the clear understanding that the lowest bidder will get order for four units and BHEL will also participate and give a competitive bid. If BHEL is not the lowest, they will get orders for three units at the price of L1.
Alongside, NTPC has been asked to work on four units of 800 MW each at Darlipalli in Orissa and Damodar Valley Corporation on two units of 800 MW each at Kodarma in Jharkhand so that bids for six 800 MW units can be issued subsequent to the international tender for 660 MW sets.
The entire bidding for these supercritical units will be through international competitive bidding and stipulate that the winners of the tender will have to set up manufacturing facilities in India with a phased manufacturing program.
New HR coils unloading record at Kandla Port
Exim News Service reported that a new unloading record in hot rolled steel coils was set at Kandla Port recently when 1,537 coils weighing 43,280 tonnes were discharged from the vessel MV Tai Harmony.
According to Mr PS Mann GM of the importer PSL Limited, the vessel berthed at CJ number 9 at 18.45 hours on May 8th 2008 and commenced discharge at 20.00 hours. The entire quantity was unloaded by 09.00 hours of May 10th 2008.
He added that Samrath Lifters Private Limited also played a significant role in achieving this milestone. The vessel agent and stevedore was JM Baxi & Co.
RPG group unveils INR 9000 crore CAPEX plan
BL reported that Kolkata based RPG group will invest INR 9,000 crore in power, tyre and carbon black industries as part of its expansion program in the next couple of years.
Mr RP Goenka chairman of RPG group said that while the company would pump in INR 6,000 crore in the Calcutta Electric Supply Company in the 2 years, it has set aside INR 2,000 crore for Ceat Tyres and INR 1,000 crore in the Philips Carbon Black. He added that money would be invested in CSEC to raise its production to meet the needs of states like Jharkand, Orissa and West Bengal.
Mr Goenka said that the large investment was necessitated to compete in the fields following the government's liberalization, privatization and globalization policies. He added that it is aiming to increase productivity, quality and facilities to workers by the expansion.
Replying to a query regarding the INR 5,000 crore power project in Kannur, Mr Goenka said that he was forced to drop the project following lack of interest shown by the succeeding government.
India among favorite investment destinations
According to global consultancy Grant Thornton’s International Business Report 2008 on emerging global markets, China, India and Russia have emerged as the top 3 most favored destinations for investment and development. These are followed by Mexico at fourth and Brazil at fifth place.
As per report, India and China, the world’s two fastest growing economies, leads the list of best places for investment and development, driven by their current GDP growth rates, appropriate investment climate and substantial trade opportunities.
The study also revealed the presence of 22 other rapidly growing global economies, including Malaysia, Indonesia, Iran, Pakistan, Thailand and Poland that offer immense avenues for future growth.
Mr Monish Chatrath Grant of Thornton India National Markets said that "Emerging markets offer great potential for growth in a global economic slowdown scenario. Availability of low cost yet highly educated labor force with strong work ethics, combined with fast industrialization, technology deployment and a strong focus on infrastructure development is enabling these countries to close the gap with the more affluent and relatively slower growing mature economies."
According to recent projections, China’s economy would move ahead of the US by 2027, India would catch up with the US by 2050 and the Brazil, Russia, India and China as a group will surpass the G7 by 2032. Emerging and developing economies’ will on an average grow by 6.3% in 2008 and 6.4% in 2009. In contrast, advanced economies are forecast to grow by 1.3% during this period.
Indian firms most confident among BRIC nations—KPMG study
According to a KPMG business outlook survey, Indian service sector companies are the most confident lot among BRIC (Brazil, Russia, India and China) nations, with 60% of them expecting increased business activity in the coming year.
The report said that Indian service companies are also the most optimistic regarding profits. Company profitability in the region is expected to increase strongly over the next year. It added that "Higher workloads are predicted to support a robust pace of job creation across the BRIC nations. Around 37% of service providers anticipate growth of employment, with Russian and Indian firms the most upbeat."
However, more than half of the service providers in the region expect operating costs to raise in 12 months, mainly due to higher raw material prices, staff salaries and outsourcing costs.
The report said that "Service providers are confident that revenues will rise over the coming year. Higher new orders, improving market conditions and the introduction of new products were cited as the main factors likely to support growth of revenues."
Among the service providers, financial intermediaries were most optimistic about higher business activities. About 58% of the companies surveyed believe that BRIC service providers will see growth in volumes of new businesses.
Nissan and Ashok Leyland step up investment in Indian JVs
Japanese auto major Nissan Motor and truck maker Ashok Leyland have stepped up planned investment in their 3 new JV companies by USD 75 million to USD 575 million. Seven months ago, the two companies had announced their plan to invest USD 500 million in vehicle manufacturing, power train manufacturing and technology development in India.
The enterprise will involve a capacity of 100,000 vehicles in the first phase, to be scaled up subsequently. The plant is expected to start production from 2010-11. Among the 3 platforms identified, covering applications up to 7.5 tonne gross vehicle weight is an all new generation Nissan Atlas F24 light duty truck. Additionally, an all new engine is being developed specifically for LCV applications, as part of the range of Euro 3 and Euro 4 compliant diesel engines.
Mr Andy Palmer corporate VP of Nissan Motor said that the additional USD 75 million will be invested in tooling for the first range of products and R&D. Considered one of the most expensive items in a manufacturing plant, the investment in tooling could launch radically designed vehicles into the market.
Terming the association with Ashok Leyland as one huge advantage due to its local knowledge in knowing customer needs, Mr Palmer said that the challenge is to maintain quality and offer right products at right price points. He added that "India is a massive, expanding market providing good opportunities for growth. The changes in its transportation system and the hub and spoke distribution model are putting the venture in the front of the wave."
Mr R Seshasayee MD of Ashok Leyland said that "The current growth plans of Ashok Leyland involve, not only our stated capacity additions and new product launches but also, with this important step, our entry into the fast growing LCV segment. The balanced JV structure facilitates meaningful contribution from both partners and the best opportunity to leverage their respective strengths."
CIL WCL signs MoU for operational transparency
It is reported that Coal India Limited’s Western Coalfields Limited has signed a MoU with global anti corruption watchdog Transparency International India to ensure transparent, fair and corruption free transactions in public contracting and procurement.
Mr DC Garg CMD of WCL and Mr RH Tahiliani chairman of TII have signed the MoU.
The MoU makes it mandatory on part of WCL and contracting parties to abide by an integrity pact developed by TII to be fair and transparent in dealings to ensure corruption free business.
NPCIL gets Russian uranium for Kudankulam plant
BS reported that Nuclear Power Corporation of India Limited has received the first consignment of uranium fuel from Russia for unit 1 of 1,000 MW Kudankulam nuclear power project.
According to Mr AI Siddiqui of Nuclear Power Corporation of India Limited, through a sovereign guarantee of the Russian Federation, an assured fuel supply for the next 60 years has been made available to the project. He added that the construction activities are being carried out round the clock at the project site and 86% of the work has been completed.
The project, located in Tamil Nadu’s Tirunelveli district, comprises two units of 1,000 MW each. The two units of the project belong to advance design of VVER family, a pressurized water reactor constituting a majority of power reactors in the world. These reactors use light enriched uranium as fuel. It is being built with technical collaboration from the Russian Federation.
Eicher Motors inks JV with Volvo
It is reported that Eicher Motors Limited and Volvo have formalized their JV, in which Volvo will pump in INR 1082 crore. Eicher Motors will hold 54.4% stake in the JV while, Volvo will hold the rest 45.6%. Volvo will have an economic interest of 50% in the JV.
Mr Siddhartha Lal MD & CEO of Eicher Motors said that "The commercial vehicles business along with related components and design services of Eicher Motors will be transferred to the JV, which will be an unlisted subsidiary of Eicher Motors, on a slump basis at a value of INR 202.2 crore." He added that as part of the JV agreement, Volvo will transfer its Indian truck distribution and service network business to the JV.
Mr Par Ostberg executive management member of Volvo Group and also chairman of Volvo Trucks Asia said that the move is a part of its plans to tap the fast growing commercial vehicles market in Asia, and India in particular. He added that "India is the fourth largest market for heavy trucks in the world and with the country investing heavily on improving infrastructure, there is a big opportunity for us."
He said that all Volvo Group truck projects in India would be routed through the JV and Volvo may also look at entering the commercial vehicles financing business in which it is successful globally.
Eicher plans to buy back 3.6% stake from Daimler
ET reported that Eicher Motors Limited wants to buy back the 3.6% stake held by German auto major Daimler Motors.
Mr Siddhartha Lal MD & CEO of Eicher Motors said that "We are looking at buying back Daimler’s stake. We have not made any formal offer, but will take the opportunity as and when it arises."
Lal family, the promoters of Eicher Motors have the right of first refusal on Daimler’s 3.6% stake in EML. As of now, the Lal family’s total holding in EML is 58.2% stake. Daimler’s stake in EML was earlier held by Eicher’s technology partner Mitsubishi Motors of Japan.
Indian dock workers to continue strike in US
The Hindu reported that Indian dock workers, who have been demanding that they be allowed to stay in US until an inquiry against a company which allegedly exploited them is completed, vowed to continue their hunger strike even after 4 of them were hospitalized. They are on strike for the past 11 days.
As per report, Mr Christopher Glory, who was hospitalized after being diagnosed with erratic blood pressure on the eighth day of the stir to press action against Signal International and its Indian recruiters, was discharged from the hospital.
Elecon Engg 2007-08 net profit up by 21.8% YoY
Elecon Engineering Company Limited has recorded a turnover of INR 826 crore for the year ended March 31st 2008 up by 14.5% YoY as against INR 721 crore in the year ended March 31st 2007. Net profit was recorded at INR 67 crore up by 21.8% YoY as against INR 55 crore. Its current market capitalization is around INR 1291 crore.
Mr Prayasvin Patel CMD of Elecon Engineering said that "We are proud of our achievements in the year 2007–08, but we have set further more ambitious plans for Elecon for the year 2008–09. We are looking at investments of more than INR 100 crore specifically for wind mill gear box facility, which is one of the agenda of this plan. Another big step for the year ahead is the expansion in the international markets, tie up with Renk AG of Germany to design & manufacture gearbox for vertical rolling mill to be used in cement and coal industry is the initial part of our expansion plans. To sum it up we are looking at an incredible 2008-09 for Elecon Engineering."
Elecon Engineering board has also approved total INR 182.06 crore CAPEX for the year 2008-09.
POSCO supporters call off stir
SNS reported that the supporters of POSCO project from Govindpur, who had been staging dharna in front of Kujanga police station, have called off their protest following certain assurances by the district administration.
The district administration urged upon the villagers to call off the stir and assured that they would be provided adequate protection within a week. The administration also promised to arrest the accused persons in the sensational palm chopping of Mr Natbar Khatua incident.
It may be noted that the villagers had been demonstrating protesting police inaction and demanding justice and protection. They had warned that the stir would be intensified further in case the administration does not pay any heed to their demands.
The agitators allege that police have played a very inactive role in the project area and cited the example of Mr Khatua palm chopping case, the accused of which incident are still moving scot free. They said that tension still prevails at Govindpur village for some days.
Meanwhile, the project supporters alleged that the morale of anti POSCO activists have got a fillip after they could pressurize the administration for the withdrawal of police force from the village by detaining senior police officers for hours.
Sponge iron price unlikely to decline – Monnet Isapt
BS reported that despite buyers' apprehension on placing fresh orders ahead of the monsoon season, prices of sponge iron is unlikely to decline from its current levels.
As per report, sponge iron or direct reduced iron, being quoted at INR 18,000 per tonne, have seen around 14% fall in the last one month because of subdued raw material prices and market switching to need based buying instead of creating inventory.
Mr Amitabh Mudgal GM (marketing) of Monnet Ispat said that "An independent sponge iron producer cannot afford selling below current levels. Iron ore fines are quoted in the range of USD 90 to USD 100 per tonne. Coking coal has perked up to USD 300 from USD 130 a tonne in the last three four months, while coke has doubled to USD 600 a tonne since the beginning of the year.
Mr Mudgal said that at a minimum margin of 10% to 15%, the current level is the cut off price for an independent producer. Therefore, there is hardly any room for sponge iron prices to fall further.
Vedanta to export bauxite from Kadinada
BS reported that Orissa based Vedanta Alumina Limited is set to export bauxite from the deep water port with the setting up of 3 silos. Kakinada Sea Port Limited, in association with Chettinad Port Limited, had constructed these silos at an investment of INR 80 crore. It has a capacity of 67,500 tonnes.
A Kakinada Sea Port official said that other companies that are into bauxite export could also utilize the silos facility. Meanwhile, the port has also completed the construction of the off shore vessel complex. This has facilitated the operations of the four berths of which one berth has been exclusively allotted to Reliance Industries Limited.
Around 20,000 tonnes of bauxite powder have already been stored in the silos. The first vessel is likely to carry the bauxite powder in the first week of June 2008.
Dhamra Port to be commissioned by April 2010
Dhamra Port Company Limited, a 50:50 JV of Larsen & Toubro and TATA Steel, to set up a port at Dhamra in Orissa is expected to commission the port by April 2010. Estimated to cost INR 2,463 crore in the first phase, more than 25% of the work has already been completed.
The first phase will see two of the total 13 berths being developed with the northernmost being for liquid cargo, the southernmost for clean cargo and the middle berth for dry bulk cargo.
Mr Santosh Mohapatra CEO of Dhamra Port Company Limited said that the two berths will have basic loading unloading facilities. In the first phase, the capacity of the port will be 25 million tonnes annually, ultimately going to 80 million tonnes annually. In the first phase, the port will provide direct employment to around 1,000 people.
The Dhamra port site is north of the river Dhamra and will come up as a deep draft port which can accommodate super cape size vessels. A number of steel plants, apart from TATA Steel, are coming up in the three states of Orissa, Jharkhand and West Bengal.
Meanwhile, steel makers setting up factories in Bengal, Jharkhand and Orissa have shown interest in the upcoming Dhamra Port through which they plan to route imports and exports. The companies want to use the port to import coking coal, limestone and export finished steel.
Villagers to protest ArcelorMittal steel plant in Orissa
Kalinga Times reported that residents to be affected by ArcelorMittal’s steel plant in Patna tehsil have staged a dharna in front of the district collector’s office where a consultative workshop organized by ArcelorMittal on roadmap of corporate social responsibilities activities was being held.
Activists of Mittal Pratirodh Manch and All India Krishak Khet Mazdoor Sangh, who have been opposing the steel project, shouted that "Mittal go back, we do not want displacement. We will not allow the plant to come up on agricultural land. We are ready to face bullet. We want irrigation, not industries."
Mr Raghunath Das state unit secretary of All India Krishak Khet Mazdoor Sangh said that around 14,989 persons belonging to 4,000 odd families living in 17 villages are going to be displaced by the ArcelorMittal plant. He added that "We were ready to have a dialogue with the chief minister since the government is acquiring land for the plant."
Vorskla Steel unveils offer for Kremikovtzi
Dnevnik daily reported that the race for a controlling stake in Bulgaria's Kremikovtzi steel mill entered a new stage with Mr Konstantin Zhevago’s Vorskla Steel unveiling the parameters of its offer.
The paper said that Vorskla Steel is ready to spend USD 500 to USD 650 million on capital expenditures and USD 60 to USD 120 million on environmental upgrades.
In an interview with Dnevnik daily, Mr Viktor Demeniuk MD of Vorskla Steel said the strategy entailed decisive measures aimed at the mill’s financial overhaul and at attracting and training staff. Vorskla also plans to introduce a new sales policy, which eliminates mediation and relies on direct sales agreements with end customers. The offer also includes residential and social perks for Kremikovtzi’s staff.
According to Demeniuk, Finance and Credit has been in talks with the mill’s bondholders and the bank representing the five largest bondholders of the mill. According to him, ArcelorMittal was in parallel talks with the bondholders. He argued the final winner of the deal would depend on the outcome from the talks with bondholders.
The paper said that like ArcelorMittal, the other candidate for the mill, Vorskla also wants to buy Kremikovtzi once it emerges from bankruptcy proceedings and undergoes full audit into its assets to ensure that the future owner found no hidden liabilities or non existing assets.
ArcelorMittal SA opens refurbished rebar mill in Mozambique
It is reported that ArcelorMittal South Africa officially opened its 35,000 tonne per year capacity rod mill at Maputo in Mozambique to supply to the domestic construction market in Mozambique.
The mill would produce 8 mm, 10 mm, 12 mm, and 14 mm merchant bar, rebar, and steel droppers, which would be produced from billets imported from South Africa's Newcastle works and Ukraine.
It is one of two mills acquired by ArcelorMittal SA from the Mozambican government in 2006 for USD 11.4 million. The newly opened mill had been standing non operational for eight years, and refurbishment started in January 2007, at a cost of about ZAR 25 million. Commissioning began in February 2008 and the full production capacity expectation of 100 tonne per day is to be reached over the next two months.
During refurbishment, all PLCs were replaced, the main gearbox was refurbished, the main control box was refurbished, and all components and areas thoroughly cleaned. Owing to the age of much of the equipment, many teething problems are still being addressed.
Ms Nonkululeko Nyembezi-Heita CEO of ArcelroMittal SA in an address to dignitaries, businesspeople and journalists in Maputo said that "The investment is part of a wider strategy to grow in Africa. Mozambique will always be special to us as the place where we cut our teeth doing business outside of our country.”
voestalpine to choose between Ukraine and Romania
The Viennese daily Der Kurier without citing any sources reported that Austrian steel group voestalpine AG likely will choose between Romania and Ukraine as the site of its EUR 7 billion steel plant in the Black Sea region
The newspaper reported that the Austrian group's supervisory board will address the site options at its meeting in September.
According to Der Kurier, Ukraine is a good candidate due to its proximity to voestalpine's iron ore providers in the Ukraine and the country's favorable carbon dioxide emissions regime, while Romania's status as a fellow EU member state would provide greater legal security and political stability for the plant.
British and US steel unions to merge
A British press report said that Britain's biggest trade union is set to announce a merger with a US counterpart to eventually create the first global labor organization. The paper said the two unions had finalized the details of a framework agreement and a formal alliance would be unveiled at a USW convention in Las Vegas in July.
The Sunday Telegraph said that the planned tie up between Britain's Unite and United Steelworkers in the United States is designed to better protect workers against the effects of globalization. The report added that the two unions view the merger as the first step towards a global union that could take in labor movements from the world's emerging markets in eastern Europe, Latin America and Asia,.
The paper said that the plans also reflect recognition among union officials in Britain and the United States that as a cross border body they would be stronger in negotiations with multi-national companies.
Unite has two million members in Britain and the Republic of Ireland working for major companies including oil giant BP and Rolls Royce, while USW has more than one million members in the United States and Canada.
ArcelorMittal SA shows interest in Zimbabwe Iron and Steel Co
Bloomberg reported that ArcelorMittal South Africa may consider buying Zimbabwe Iron and Steel Co, if the state puts it up for sale.
Ms Nonkululeko Nyembezi-Heita CEO of ArcelorMittal SA in an interview said that “We would be interested, but it is early days. The Zimbabweans haven't made clear what their intentions are.''
ArcelorMittal South Africa, controlled by the world's biggest steelmaker ArcelorMittal, is expanding production in Southern Africa where the economy is growing at a faster rate than in developed countries. ArcelorMittal South Africa today opened a steel reinforcing bar plant in Maputo, Mozambique.
Mr Kobus Verster director finance of ArcelorMittal SA added that extensive refurbishment work would be necessary at the Zimbabwean plant, which isn't producing anywhere near its full capacity.
Feng Hsin to hike all product prices
Taiwan's Feng Hsin Iron and Steel announced to increase prices to cover the substantial rises in the costs of scrap and billet.
Feng Hsin Iron decided to increase by TWD 700 per tonne for their rebar after remaining the prices unchanged last week.
Feng Hsin is also adding its section steel prices by TWD 1,000 per tonne. Consequently rebar new price is at TWD 31,700 per tonne and section steel price is between TWD 31,000 to TWD 31,500 per tonne.
(Sourced from YIEH.com)
Mozambique may set up flat products steel plant
Bloomberg reported that Mozambique will complete an investigation into the country's first integrated steel plant, costing at least USD 2 billion by July 2008 or August 2008.
Mr Sergio Macamo Mozambique’s national director of industry in an interview in Mozambique's capital Maputo said that “We are well advanced with the plans. We are confident steel is doing very well internationally. We are on a roadshow to find an operator for the plant.”
Mr Macamo said that the plant will produce about 2 million tonnes of flat steel products a year for export.
He added that the project would be a joint venture between the Mozambican and South African governments.
Moody assign Baa2 unsecured rating to ArcelorMittal
Moody's Investors Service has assigned Baa2 senior unsecured ratings to ArcelorMittal's USD 3 billion of senior unsecured notes, consisting of two tranches with 5 and 10 year maturities.
Moody said that given the strong performance in the first quarter in 2008 and the expectation that performance will be strong in the current quarter, ArcelorMittal is currently very solidly positioned in the Baa2 rating category despite strongly increased indebtedness following share buy backs and cash outflow for increased working capital requirements.
Going forward Moody's expects ArcelorMittal's debt position to improve again due to anticipated reduction in share buy backs and a slowdown in working capital changes.
Taiwanese H beam prices continue to rise
Taiwan’s H beam domestic price is very likely to reach as high of TWD 40,000 per tonne in line with the constant rises in steel plate prices
New offers for H beam exports to Middle East and Europe have smashed through USD 1,200 per tonne and some large size section are between USD 1,300 per tonne to USD 1,400 per tonne.
H beam export price to Asia is about USD 1,240 per tonne CNF few days ago. Current price is approaching USD 1,300 per tonne CNF now due to tight supply. Meanwhile, A572 import price in Taiwan from China has reached USD 1,230 per tonne.
(Sourced from YIEH.com)
Japanese H2 scrap prices continue to soar
With Tokyo Steel increasing its scrap purchase price on May19th 2008 most mills have also increased scrap purchase price by JPY 1,000 per tonne. The move saw the H2 scrap basic price increase to JPY 63,500 per tonne.
Scrap market price remains strong in the Kanto region at present, as the highest H2 scrap price was JPY 64,500 per tonne and the lowest price was JPY 61,500 per tonne with the basic price being JPY 63,500 per tonne.
Newly produced scrap basic price was in a margin between JPY 66,000 to JPY 66,500 per tonne.
(Sourced from YIEH.com)
POSCO says not shown interest in Krakatau Steel
South Korean steel maker POSCO said that it had not expressed interest in a stake in Indonesian state steel firm PT Krakatau Steel.
A POSCO spokesman said that "The Indonesian government has not announced details of a privatization plan for the company yet and we have not expressed interest in the company,"
Earlier, Mr Sofyan Djalil Indonesia's state enterprises minister said that POSCO had expressed its interest to take part in the privatization of Indonesia's biggest steel firm.
Hyundai Mipo may add a block plant in South Korea - Report
Reuters reported that South Korea's Hyundai Mipo Dockyard Co Ltd might invest KRW 190 billion (USD 181.1 million) in a new block assembly factory, where ships are part assembled, south of Seoul to expand its capacity.
Hyundai Mipo in a filing to the Korea Exchange said that it had reached preliminary agreement with a local government authority to build the factory in Ulsan where the shipbuilder has a shipyard.
Hyundai Mipo and Hyundai Heavy Industries Co Ltd the world's top shipbuilder have shipyards in Ulsan about 300 kilometres southeast of Seoul.
Hyundai Mipo did not give further details saying the agreement needs approval from its board of directors.
Alstom Ecotecnia to supply wind turbines to Iberdrola Renewables
Alstom’s wind activity Ecotècnia announced the signing of a frame agreement to supply around 300 MW worth of wind turbines to Iberdrola Renewables marking Alstom’s first large agreement of this kind in wind energy since it acquired Ecotècnia in November 2007.
Under the terms of the agreement, worth around EUR 300 million, Alstom will supply Iberdrola Renewables with the turbine models Eco 74, Eco 80 and Eco 80 2.0 totaling around 300 MW, over a period of four years.
Mr Philippe Joubert executive vice president and president Power Systems of Alstom said that “This agreement clearly shows the confidence of Iberdrola Renewables, the world leader in the wind industry, in our renewable energy technology. In the wake of the EU’s call for a 20% share of renewable in overall energy consumption by 2020, we expect an ever-increasing demand for Alstom’s wind turbines in the years to come.”
Over 20 GW of new wind turbines were installed worldwide in 2007, boosting global installed capacity to over 100 GW. Europe made up 60% of this total.
Dry bulk shipping driving inflation – Report
Forbes reported that as soaring shipping rates drive the prices of dry bulk commodities higher, investors wonder what the breaking point will be.
As the delivered costs of raw materials rises the importers of those raw materials especially China and India are negatively impacted by the inflation. Eventually higher prices are passed on to the end users of those products, the consumer.
At the same time China exports a significant amount of finished products to the US which means the US consumer will ultimately pay higher prices on consumer goods imported from China, as well.
Mr Urs Dur analyst of Lazard Capital Markets said that in some cases the shipping prices for iron ore from Brazil to China have gone as high as 100 times the price of the iron ore itself. He said that with a good portion of the iron ore delivered to China delivered on the spot market, rates on Capesize ships which are the largest vessels have skyrocketed. Currently, the freight cost for a tonne of Brazilian ore to China is about USD 108 per tonne higher than the USD 80 per tonne price for iron ore from Brazilian miner Vale.
Subsea 7 buys pipe laying vessels for USD 62 million
Reuters reported that Norwegian offshore services group Subsea 7 has bought pipe lay and construction vessel Skandi Navica for USD 62 million.
Subsea 7 said that the vessel, to be renamed Seven Navica has been under charter with Subsea 7 for eight years. But did not specify who the seller was.
Mr Mel Fitzgerald CEO of Subsea 7 said that "This investment is further evidence of our belief in the future rigid pipe lay market.”
Choo Bee Q1 revenue up by 52%YoY
Malaysian Steel manufacturer Choo Bee Metal Industries said that its first quarter net profit more than doubled as it managed to sell its products at higher prices and the company expects to do well for the rest of the year thanks to rising international steel prices.
Choo Bee said that it made a net profit of MYR 16.3 million for the quarter to March 31st 2008 as compared to MYR 6.7 million for the same quarter a year ago. Revenue jumped by 52% YoY to about MYR 156 million.
Choo Bee in a statement to Bursa Malaysia said that "The current high selling prices in the domestic steel industry are expected to be sustainable given the positive outlook for domestic demand from the building and construction industry.”
It said that “We continue to broaden our export markets and are also working towards obtaining certification of line pipes by the American Petroleum Institute.”
Malaysian Loh & Loh wins USD 84.73 million construction deal
Reuters reported that Malaysian builder Loh & Loh Corporation has won a MYR 273 million (USD 84.73 million) contract for construction works on a railway track in the country.
Loh & Loh Corporation said that the deal was awarded by India's Ircon International Ltd.
Novelis to expand aluminum output in Brazil
Novelis Inc announced that it plans to invest more than USD 30 million in its operations in Brazil over the next 18 months in a number of projects designed to increase production capacity and introduce new technology.
Ms Martha Finn Brooks president and COO for Novelis said that "These investments will allow us to continue to meet the demands of the rapidly growing markets in South America as well as provide a technology platform from which we can expand our offering of innovative, high value products to our customers.”
She said that close to USD 21 million will be invested in process technology and equipment improvements at the company's aluminum rolling mill and recycling complex in Pindamonhangaba. The improvements will provide a double digit increase in the plant's rolling capacity to 400,000 tonnes per year and will increase its annual capacity for aluminum recycling from 80,000 to 150,000 tonnes.
Ms Martha said that Novelis will also invest USD 4.6 million at its Ouro Preto plant to install its Novelis Fusion solidification technology for the production of aluminum sheet ingots with multiple alloy layers. In addition the company said that it will invest USD 4.7 million in an information technology project aimed at integrating and unifying its current operating systems in Brazil. The activity will serve as a global pilot project for Novelis and will later be implemented in the company's operations worldwide.
Novelis Inc is the global leader in aluminum rolled products and aluminum can recycling. The company operates in 11 countries, employs approximately 12,900 people and reports annual revenues of more than USD 11 billion. It supplies premium aluminum sheet and foil products to automotive, transportation, packaging, construction, industrial and printing markets throughout North America, South America, Europe and Asia.
STX Shipbuilding to increase capacity by 20% in 2008
Bloomberg reported that Europe's largest shipyard STX Shipbuilding Co is planning to raise capacity at its South Korean yards by 20% in 2008 after adding a second floating dock to meet demand for new vessels.
Mr Kang Ssang Won senior VP of STX Shipbuilding told reporters that it would spend KRW 142.6 billion (USD 135 million) to build the new dock on the south coast the yards in Busan and Jinhae will be able to handle 60 ships as compared with 50 in 2007.
Mr Kang added that “We are trying to become a world leader in shipbuilding. We want to be in markets where we believe there will be need for new vessels.''
Mr Lee Ki Yeon executive VP at unit STX Heavy Industries Co said that “STX Shipbuilding will focus on building Very Large Crude Carriers, the largest of their type and vessels to carry liquefied natural gas at Jinhae, while focusing on smaller ships at Dalian.”
HDG prices in US on upward trend
US main flat rolled steel mills have announced prices for July 2008 shipments buyers predict that the prices may reach a peak high soon.
AK Steel, the first to announce its price is informing customers that all carbon steel prices will rise by USD 83 per tonne for new orders. AK’s current galvanized base price is set at USD 1,372 per tonne.
Though the price continues to rise, the demand for galvanized steel is still quite light. That is mainly because the construction and automobile markets are still comparatively weak.
(Sourced from YIEH.com)
ArcelorMittal and Cemig ink power supply deal in Brazil
It is reported that Brazilian power utility Cemig has signed a long term power supply deal with local units of ArcelorMittal that could be worth as much as BRR 4.4 billion (USD 2.7 billion).
Cemig controlled by the Minas Gerais state government and which has US utility AES Corp as a major shareholder in a statement said that it would supply ArcelorMittal units with an average of 313.5 MW double current levels, through 2020.
It said it is one of the biggest deals ever signed within the unregulated part of Brazil's electricity market. Most power sales occur within the government regulated environment via a system of public auction.
Energy intensive metals producers have been alarmed by a rise in energy prices at the end of last year and in early 2008, when Brazil narrowly avoided power rationing and they have been seeking to guarantee firm supplies.
Japan ferrous scrap price nearing JPY 70,000 level
JMB reported that Japanese ferrous scrap market increases toward JPY 70,000 per tonne level for H2 grade around Tokyo.
The demand is strong when integrated steel makers increase the consumption to reduce carbon dioxide emission along with firm demand from South Korea.
Japanese electric furnace steel makers try to find the price trend when they try to pass the higher cost on the selling price.
Tenova revamps pusher furnace of Acroni doo Jesenice in Slovenia
Tenova LOI Italimpianti announced that it has successfully received the FAC Certificate from Acroni doo Jesenice, Slovenia for the revamping of the 90 tonne per hour pusher furnace.
The major revamping and modernization of the furnace was the replacement of the top soaking zone refractory hearth arrangement with a top and bottom soaking zone as skids cooling system. The supply included also the new discharging machine replacing the existing slope skids.
Aim of the refurbishment was to increase the furnace throughput and achieve better furnace’s performances in term of product quality and decrease of the energy consumption.
Auto steel prices to break 26 year record in Japan
Kyodo News reported that the average price of steel for Japanese automakers is expected to top JPY 100,000 per tonne in 2008 which would rewrite the record high for the first time in 26 years.
Industry sources said that Toyota Motor Corp and major steelmakers including Nippon Steel Corp are finalizing an agreement to raise the average price of some JPY 80,000 per tonne by more than JPY 20,000. The record high is JPY 99,000 set in fiscal 1982.
They said that Toyota is the largest customer in the Japanese steel industry. If it accepts the new price, other automakers, shipbuilders and electrical machinery makers will follow suit. Consumers are also expected to feel the increase.
Major Japanese steelmakers expect prices for coal to spike three fold and iron ore to jump 65% in fiscal 2008, which began last month. They are demanding steep product price hikes of about JPY 30,000 per tonne for 2008
Sources said that Toyota has rejected that level but is expected to accept a slightly lower hike to secure supplies amid growing demand in China.
POSCO hold 2nd Asia Forum
It is reported that POSCO's TJ Park Foundation held its second annual Asia Forum inviting some 300 students, professors and opinion leaders from Asia to discuss the region's rapidly changing role on the global stage.
Mr Lee Ku taek CEO of POSCO at the opening ceremony told audience that “The world is paying close attention to Asia's economic vibrancy, cultural richness and societal potential. It is important for well educated individuals to live up to these expectations.''
The TJ Park Foundation funds about KRW 300 million annually for research in key fields, which is presented at the forum.
POSCO TJ Park Foundation started to hold this forum from last year to provide the opportunity to examine and discuss common humanities and social issues such as the culture and value of Asia.
Vietnam trade deficit gap triples
Bloomberg reported that Vietnam's trade deficit more than tripled in the first five months of the year as JP Morgan Chase & Co released a report citing worrying trends with the country's balance of payments.
According to preliminary figures released by the General Statistics Office in Hanoi, Vietnam's trade gap widened to USD 14.42 billion from USD 4.25 billion at the same time a year earlier. Exports rose 27% to USD 23.4 billion, while imports climbed 67% to USD 37.82 billion. The widening of the trade gap this year has contributed to pushing the country's current account from near balance in 2006 to a large deficit in 2007
JPMorgan Chase in a report dated May 23rd 2008 said that the surge in imports has been worsened by consumption related purchases from abroad.
Mr Matthew Hildebrandt an economist at JPMorgan Chase Bank in Singapore said that “Foreign investment flows have grown considerably and account for a large portion of the financial account surplus, but these alone cannot fund the trade deficit. Financing is partly from short term loans and portfolio and remittance flows, which can be fickle.''
Vietnam's purchases of machinery and equipment from abroad jumped by 43% through May to USD 5.72 billion, while the import of petroleum products from abroad climbed by 69% to USD 4.86 billion. Iron and steel imports surged by 84% by volume and 138% by value to USD 4.15 billion, while purchases of cloth from abroad advanced 15% to USD 1.79 billion.
Tampere University and Ruukki develop new technology for cabin designing
It is reported that new technology developed by Tampere Technical University and Ruukki saves many stages in the design of cabins for mobile machines.
The release said that “Collaboration between the Tampere University of Technology’s virtual reality laboratory and Ruukki have provided new tools to design cabins for mobile machines. Three dimensional visualization can be used to evaluate cabin and tool function and literally put you in the picture.”
Professor Asko Ellman from Tampere University’s virtual technology laboratory said that “The new technology gives mobile machine makers a distinctly improved competitive edge. Customers gain a head start in design and production. The model is produced direct from a CAD image. A virtual cabin, which is the right size and almost identical to the real thing is superimposed on a virtual model of a mobile machine. Similar modeling was earlier used mostly in product design in the automobile and aircraft industries”.
The CAVE virtual reality laboratory is located on the same site as Seinäjoki University of Applied Sciences in Finland and close to Ruukki’s Kurikka unit which makes cabins.
Ruukki wants to take part in the development of digital machine design. This is why it is sponsoring Tampere Technical University’s professorship on a project like basis during 2007-2008. The company wants to utilize virtual reality as early as possible in the design process.
Acepar requests restrictions on charcoal exports
BNamericas reported that Paraguayan steelmaker Acepar has asked authorities in the country to restrict exports of charcoal, which the company uses as fuel for its furnaces, because it is experiencing supply problems.
An Acepar executive told BNamericas that "If we cannot count on charcoal supply, in the medium term we would have to shut down the furnace and as a consequence our operations.”
Acepar's request comes despite the fact that three years ago it announced plans to invest some USD 20 million to reforest 300 hectare for charcoal production, after it was unable to secure gas supplies from the Bolivian government.
The executive added that "If we could count on the gas, we could think about installing a 1 million tonne per year furnace, but for the time being that's not possible.”
In mid 2006 the company announced plans to invest more than USD 30 million in various works, such as a third furnace with capacity of 750 tonne per day and a 150,000 tonne per year sinter plant. The investments were due to be completed in a timeframe of 18 to 24 months.
Michigan Seamless hikes tube prices
Michigan Seamless Tube LLC has announced to increase its spot prices for cold drawn seamless and mechanical tubing effective from June 30th 2008.
Michigan Seamless said that alloy grades will increase by USD 200 per short ton and carbon grades will increase by USD 160 per short ton. It said that for heat treated products, price will stay unchanged until July 31
Orders already placed and scheduled to ship through July will remain unchanged and all other orders will be handled according to the new price.
ArcelorMittal to increase wire rod prices in US
In order to reflect the increased cost, recently ArcelorMittal Long Carbon North America has announced to raise the wire rod price by USD 120 per short ton from June 16th 2008.
The reasons to raise the prices by ArcelorMittal are rising cost of raw materials and the strong demand. The company raised its wire rod price in May by USD 60 per short ton.
Meanwhile, Ipsco is also raising the price by USD 170 to USD 270 per short ton effective June 29th 2008.
LME base metal prices drop last week
The increase of stock has led all base metal prices to drop last week.
The three month price of zinc dropped by 6% to USD 2,150 per tonne
The three month price of nickel decreased by 7.7% to USD 24,100 per tonne
The three month price of copper also experienced a drop of 1.6% to USD 8,180 per tonne.
However, the three month price of aluminum remained stable and increased by 0.2% to stand at USD 3,001 per tonne.
Analysts think the high stock level will keep the metal price weak this week.
(Sourced from YIEH.com)
Wheatland Tube increases tube prices by 4%
Wheatland Tube Co of the US announced to increase its prices for mechanical tubing by 4% effective with all order after July 7th 2008.
Orders that shipped after this date will be quoted according to the new price.
The move follows similar actions for July by other tubular product makers across North America, including ArcelorMittal Tubular Products Shelby Inc and PTC Alliance.
(Sourced from YIEH.com)
Ruukki to supply steel for newest landmark in Stockholm
Rautaruukki announced that it is to supply the steel frame and load bearing roof structures for a new congress centre to be built in Stockholm. Ruukki will be responsible for the production, fire protection and installation of the steel frame and load bearing roof structures. The delivery is valued at around EUR 6 million.
The congress centre is part of the Stockholm Waterfront hotel and congress centre project and is to be built in a central location in the heart of Stockholm adjacent to the main railway station and will be one of Stockholm’s most significant landmarks with views over Riddarfjärden and the City Hall.
The largest wall truss of the steel frame for this challenging construction project is 15 meters high and 50 meters long. The steel truss will be assembled resting against support towers and be welded together on site. The wall truss will bear the roof trusses, the largest of which weigh around 40 tonnes.
Deliveries to Peab Sverige AB will begin in June and installation will be completed by March 2009. The congress centre is being built for a real estate company called 43 Hotel and Congress. The project is created and managed by the investment and property development company Jarl Asset Management AB. In addition to the steel frame, load bearing roof structure and the steel structures for the stairs, Ruukki’s contract also includes installation of 12 concrete stairways. The load bearing roof structures made by Ruukki will be used over an area totaling 4,600 square meters in the congress centre. Ruukki’s delivery also includes the workshop drawings for the steel structures.
Mr Bengt Strandlund production manager from Peab Sverige AB noted that “Ruukki’s skills as an expert in demanding projects in tandem with its ability to deliver large volumes to a tight schedule were factors considered in the choice of supplier. Using expertise based on experience, Ruukki was able to tell us for example, how to support the structures during installation.”
Component shortages at Sandvik eases in April
Reuters reported that Swedish engineering group Sandvik's mining and construction unit has seen shortages of components ease lately.
Sandvik reported a steeper than expected fall in January through March pretax earnings, in part due to shortages of components in its mining and construction unit.
Mr Magnus Titus vice president of marketing and sales at the mining and construction unit on the sidelines of a raw materials seminar told Reuters that the shortages had eased in April compared with the first quarter.
He said that "I think you will see some improvements in this area, definitely. It is something we work very, very hard with obviously."
Karachi Port rescues MV Al-FullQ-7
It is reported that Karachi Port Trust rescued Panama registered ship MV Al-FullQ-7 at open sea when she developed a hole in its forward hold and came towards Karachi seeking help.
A statement here on Monday said that the ship carrying 2,676 metric tons coal ash was on voyage to Doha. Her last port of call was Kandla Port, India. Due to heavy weather her conditions deteriorated and worsened by creation of another hole in the same area threatening her and crew’s safety.
The Captain reported during early hours of the morning that the ship was listing and is likely to sink. The sinking could have spelled a material as well as environmental disaster.
A team of experienced officers and pilots reached the ship and assessed the situation. The vessel was boarded by KPT Pilots at the fairway buoy and after employing necessary safeguards it was safely brought to the Port for repairs.
Mr Aftab appointed as chairman of PSM
It is reported that Pakistan’s ministry of production has appointed Mr Moeen Aftab as chairman of Pakistan Steel Mills for a two year term.
As per report, the ministry cancelled Major General (Retired) Muhammad Javed’s contract as the PSM chairman and appointed in his place Mr Aftab of Accounts Services.
Mr Syed Yousuf Raza Gilani prime minister of Pakistan directed the newly chairman in a meeting at the PM House to run the organization on professional lines with a view of making it profitable. Mr Gilani said that he expected the new chairman to help PSM achieve optimal level of production and cost effectiveness.
PSMC Privatization - Union challenges ex chairman claims
The Daily Times reported that Mr Shamshad Qureshi president of People’s Workers Union Pakistan Steel said that the claim of Mr Abdul Qayyum former chairman of Pakistan Steel Mills is false and misleading.
He said that Mr Qayyum was fully involved in the privatization of the organization and was the front man of Mr Pervez Musharraf and Mr Shaukat Aziz during that period.
The CBA leaders, who belong to the Pakistan People’s Party Labor Wing, further said that Mr Qayyum had taken action against the union leaders and had played an active role against the union when it moved higher courts against the Pakistan Steel privatization. They added that, besides, he transferred the union leaders from Karachi to other provinces and lodged FIRs in order to victimize them.
The CBA leaders declared that the purpose of this false and misleading statement of the retired general at a Geo TV program was to pave the way for again becoming the chairman of this organization. They warned that all such attempts would be resisted.
Meanwhile, the National Industrial Relations Commission Karachi Bench has rejected the application of the Pakistan Steel management against holding a referendum in the organization. The PWU leaders welcomed the NIRC judgment, and termed it a victory of the workers.
OPEC members unhappy with oil price surge
Mr Abdala El Badri chief of OPEC said that members are unhappy with surging prices and he blamed on speculators and a weak US dollar.
He said that "We are not very happy with this increase in oil prices. Volatility has nothing to do with the fundamentals. It has nothing to do with world demand."
In a statement released by OPEC, Mr El Badri said that OPEC remained committed to working for the stability of the international oil market, noting that the current high oil prices are not influenced by market fundamentals, as the market is well supplied.
Al Habtoor Leighton wins Esplanade deal
Al Habtoor Leighton has bagged a USD 422 million contract for the construction of the mixed use Esplanade project in Dubai. The client is Muzoon Holdings. Construction on the project will commence in June 2008 and will be completed by June 2011.
The Esplanade, which will be located in Al Barsha opposite the Mall of the Emirates, will include 5 residential towers, 2 five star hotels, 1 commercial tower, 1 tower featuring a health club and spa, a car park and podium for retail and offices and water features and landscaping.
Mr David SavageMD of Al Habtoor Leighton Group said that "Muzoon Holdings was looking for a contractor that was able to deliver a quality project, within a tight time-frame in a relatively stretched market."
The new contract takes the value of Al Habtoor Leighton's work in hand to over USD 4.6 billion.
Ras al Khaimah plans educational city in Andhra Pradesh
BL reported that Ras al Khaimah is planning to set up an educational city in Anantapur district of Andhra Pradesh. The project is likely to come up in the same area that was earlier earmarked for a Science City, which was planned to have been built by a multi national consortium comprising Jurong International Group of Singapore.
In January 2007, the consortium signed a MoU with the state government for the science city. The investment projected then was USD 25 billion over 10 years. The consortium also included Springfield Land Corporation, Macquarie Bank and Semb Corporation Industries of Singapore. The science city was supposed to have facilities for hi tech manufacturing, IT, biotech, bio pharma and artificial intelligence industries.
The proposed educational city now planned will be spread over 10,000 acres of land and will have educational and research centres. It will also house an IT and bio tech park, an amusement park, hospitals among other facilities.
Official sources in the chief minister’s office said that officials from the Emirate met representatives in the industries department and a detailed project report is likely to be submitted in about a week. It added that "As per the initial plan, the proposed educational city will be spread over 10,000 acres in Anantapur. Apart from having educational and research centers, it will also house an IT and bio Tech Park, an amusement park, hospitals among other facilities."
In January 2007, the consortium signed a memorandum of understanding with the state government for the Science City.
Construction sector to spur lighting industry growth
Developments in the industrial, commercial, residential and public lighting segments have boosted the global demand for lighting fixtures that is now set to exceed AED 345 billion by 2010.
Epoc Messe Frankfurt GmbH, the organizers of Light Middle East, to take place at the Dubai International Convention & Exhibition Centre from May 25th to May 27th 2008 predict a growth spurred primarily by end users in the construction and industrial development sectors.
Mr Eckhard Pruy CEO of Epoc Messe Frankfurt said that "From basic lights to chandeliers, simple operating switches to complex sensor controlled lighting systems, Light Middle East provides the business platform for companies involved in the development and manufacture of a range of lighting systems enabling exhibitors to meet buyers from the Middle East, Asia, North Africa region and other parts of the world."
Mr Pruy noted that lamps, lighting fixtures and components are the primary categories in the electric lighting business. He added that "Major gains are expected in the categories of luminous and other non luminescent portable light fittings, such as those in light emitting diodes lights."
In addition, long lasting energy savings products, high intensity discharge lighting, and portable fixtures using light emitting diodes are expected to generate good volumes in the region.
Saudi inflation surges by 10.5%
Reuters reported that annual inflation in Saudi Arabia accelerated to an at least 27 year peak of 10.5% in April 2008 from 9.6% in March 2008 fuelled by rents and food prices in Saudi Arabia.
The cost of living index for Saudi was 115.2 points on April 30th 2008 as compared with 104.3 points a year earlier. The rental index which includes rents fuel and water surged by 16.9%, with rents soaring 20.4%, while food and beverages cost surged 16%.
Like most of its neighbors in the world's biggest oil exporting region, Saudi Arabia pegs its riyal currency to the dollar, which has fallen to record lows against the euro and a basket of major currencies this year.
Pakistan to establish three industrial zones in Sindh – Report
The International News quoted Mr Syed Qaim Ali Shah chief minister of Sindh as saying that 5000 acres of land have been allocated by the government of Sindh for the establishment of 3 new industrial zones.
Mr Shah further said that proposals to make Nawabshah and Sukkur tax free industrial zones for the next 10 years have been sent to the prime minster. He added that the new government is making extensive efforts to establish industrial zones all over Sindh, as it is the most ideal province for investments, while at the same time encouraging industrialists to expand their businesses without any fear of obstacles.
Mr Shah said that businessmen would be supported by the government in their endeavors and they would not be asked to give any accountability over their transactions. He further shared the government’s aim to build a new power plant, which would address power crises and aid traders in conducting their businesses better.
He observed that despite the fact that Sindh is rich in resources, it continues to remain poor. He noted that the Thar coal power plant would be employing 150,000 people once it beings its operations completely.
Iran to hike domestic gas prices
It is reported that Iran is planning to hike domestic gas prices in order to encourage consumers to conserve and to help to free up supplies for export.
A senior government official said that "The decision is to be announced this summer or just after." He added that natural gas sells for only two US cents per cubic meter in Iran as compared with 30 cents in neighboring countries and the difference represents a subsidy of around USD 40 billion a year.
Ironically, while Iran has the world's second largest reserves of natural gas, it is a net importer because of a highly inefficient use of it in industry and profligate use on the part of private consumers.
In January 2008, Iran announced record production of only 460 million cubic meters a day. It has a 20 year plan aiming to hike production to 1.45 billion cubic meters a day, with 642 million earmarked for domestic consumption, 259 million for injection in oil production wells and 550 million for export.
IOOC inks MoU with Malaysian oil firm for Gulf oil field project
IRINN reported that Iranian Offshore Oil Company and a Malaysian oil & gas company have signed a MoU in Kuala Lumpur on investment in Persian Gulf oil field’s development project.
Based on this MoU, the contract will be finalized in 1 or 2 months and immediately after that the development project of the Persian Gulf oil field will get started.
Dr Mohammad Ali Qayyem deputy of IOOC said that "This huge project in addition to increasing Iran’s capability in oil production and strengthening Iran’s position in OPEC will provide more than 2500 job opportunities in the region."
Dr Ali Qayyem added that "After signing the contract between the two countries on developing Resalat oil field and since the executive operation of this giant project got started, Malaysian companies showed huge interest in investment in Iran’s other oil projects."
Before this Iran’s Pars Oil & Gas Company and Malaysia’s SKS signed a USD 16 billion agreement to develop two Iranian gas fields.
Tenders for Bahrain logistics zone by June 2008
Arabian Business reported that tenders for the main construction package for Bahrain's USD 280 million logistics zone are expected to go out in June 2008. AT Kearney, which is the management consultant for the project, is looking to award the contract by August 2008 at the latest.
The customs free logistics park has over 475,000 square meter of leasable space and is designed for capacity expansion demands and to provide simplified, streamlined and efficient multimodal transfer of cargo. It is located in the Khalifa Bin Salman Port and is regulated by Bahrain General Organization of Seaports. Facilities at the park will include a sea port with a capacity of 2.5 million TEUs.
The move forms part of Bahrain's vision to becoming an alternative logistics hub in the Gulf, serving markets such as Saudi Arabia, Iran, Kuwait, Qatar and Iraq. Infrastructure work on the project is already underway and is expected to be completed in September 2008.
Mr Robert Ziegler VP of AT Kearney said that "That is when construction of the superstructures in the zone is expected to begin. The tender process for the master plan for the superstructures is currently ongoing and we are looking to make an award for that sometime next month. We will build about 30% of the superstructures and that should be done by mid 2009."
AT Kearney is a strategic management consulting firm focused on providing advice to C level management.
Mammut secures footbridges construction order from RTA
Emirates Business 24-7 reported that Mammut Buildings Systems has been awarded a contract to build 12 footbridges over Sheikh Zayed Road by Dubai's Roads & Transport Authority.
In 2007, RTA approved the construction of 12 footbridges at a cost of AED 58 million. It now plans to build 47 footbridges as part of the Metro project.
Mr Bob Webster MD of Mammut Buildings said that "The bridges will be built totally in steel. We will require 2,500 tonnes of steel for the 12 bridges. We will be building the steel structures and have not yet estimated the cost."
Mr Webster said that "We are manufacturing prefabricated buildings for the RTA's maintenance depots in Jebel Ali, Rashidiya and Al Qusais. A total of 20 buildings will be built on each site. Work has already started at Jebel Ali and Rashidiya but we are yet to begin at Al Qusais. We are building multi span and clear-span buildings using high strength steel over a total built-up area of 109,000 square meter. More than 1,900 tonnes of steel will be used at Jebel Ali and more than 4,000 tonnes at Rashidiya."
Mammut, which supplies pre engineered steel buildings, is a subsidiary of Emaar Industries & Investments and has a production facility at Sharjah's Hamriya Free Zone. Mammut produces up to 7,000 tonnes of pre engineered steel and more than 180,000 square meter of polyurethane injected sandwich panels per month. It has secured an AED 20 million contract to supply four exhibition buildings for the Lahore Expo Centre in Pakistan and has already begun delivery of the first.
Egypt clocks USD 4.9 billion surplus in 9 months
Egypt has recorded a balance of payments surplus of USD 4.9 billion in the July 2007 to March 2008 period, boosted by strong inflows of foreign direct investment.
FDI jumped to USD 11.3 billion in the July 2007 to March 2008 period as compared to USD 9 billion in July 2007 to March 2007 period, helping create a surplus of USD 3.6 billion in capital and financial account.
Imports jumped by 43.1% YoY to USD 37.6 billion, while exports rose by 31.1% YoY to USD 20.8 billion.
Chinese steel demand to remain firm - CISA
Finance and Pricing Committee of China Iron & Steel Association has released latest monthly report on China's steel market, noting that current strong steel demand won't dwindle bolstered by reconstruction demand for infrastructure and buildings in the aftermath of the Sichuan quake.
The report points out that EU and US economy looks set to retreat this year while developing countries like China would continue to drive robust global steel demand. China's dynamic economic growth is to steam ahead, propping up steel demand growth. Meanwhile domestic steel output expansion would fall back this year as a result of spiking input costs, eliminated obsolete capacity, tight power supply, transport bottleneck and credit squeeze.
That would help restore the fundamental steel market supply and demand balance and help stabilize the steel price in turn. Moreover, rising production costs of raw materials, environmental protection and financing would also lend support to steel market.
CISA believes the underlying reason behind domestic steel price rally includes booming demand, declining production growth, steep raw materials prices and expanding price spread with global market.
The report also adds that surging steel prices have increased the purchase cost of end-users significantly. Therefore, market participants should jointly reinforce the market balance and guard against drastic price fluctuations.
(Sourced from MySteel.net)
Baosteel forecast 9.6 million tonnes demand for SBQ steel
According to Baosteel, steel demand from Chinese shipbuilders is projected at 9.6 million tonnes in 2010 against a forecast of 7.5 million in 2008.
Mr Dai Zhihao VP of Baosteel Group said the projections reflect strong orders for new ships and repair work received by domestic shipyards.
Mr Dai said Baosteel's market share in 2007 fell to 14% from 29% as new players entered the market and existing competitors raised capacity.
Chinese HR strip price decrease a bit
It is reported that China’s strip steel market remained stable although the volumes were on lesser side.
Some traders said strip steel price declined in some areas, such as 2.5mmx183mm strip steel price in Hangzhou market in middle of May was CNY 5850 per tonne down by CNY 50 per tonne than last week and the price of same specification in Wuxi market was CNY 5780 per tonne down by CNY 20 per tonne.
Strip steel market price dropped slightly too in South China, dropped by CNY 50 per tonne to 60 per tonne and the turnover rate was not good.
Insiders predicted that the overall strip steel market will remain stable in short period and will fluctuate in some areas due to the weak demand from end users and traders selling products at lower price as well as raw material price change. Some insiders said domestic strip steel market will continue to rise later after its adjustment.
Chinese refined lead, zinc and tin exports dip in 4 months
Interfax China reported that China's refined lead exports sank 69% YoY to 27,063 tonnes for the first four months of 2008, while refined zinc exports slumped 82% to 275,649 tonnes and refined tin and tin alloy exports plummeted 97% to 381 tonnes.
Angang ties up with Bekaert
It is reported that Liaoning based Anshan Iron and Steel Group Corporation has recently signed a strategic cooperation memorandum with Belgium based Bekaert.
Angang and Bekaert are complementary in wire rod supply and processing and the cooperation would satisfy the soaring domestic demand for quality steel wire more effectively.
Angang is a leading steelmaker in China boasting 16 million tonnes per year of steelmaking capacity while Bekaert is a major multinational wire rod producer, which has established advanced steel wire production platform in China.
Chinese section market remains steady
It is reported that Chinese section steel price has been increasing steadily for several months, but if the demand from end users decreases due to high price pressures, current high price would lose support.
As per report market price of I-beam and channel steel in Shanghai is CNY 5,500 per tonne to CNY 5,600 per tonne as steelworks raise EXW prices, so purchase cost in traders surges as well which causes distribution price lower than purchase price.
As a result, orders for May from traders decline significantly which may influence future market trend.
Anshan to maintain targets for 2008
It is reported that Anshan Steel Company Limited indicated that the company would not raise steel output aim for 2008, although steel demand increases after the earthquake in province Sichuan.
An official from Anshan Steel revealed that the company is under full capacity now and it is unlikely for the company to further increase production plan.
Since strong demand from domestic market, Anshan Steel has already cut export plan from 3.1million tonnes in last year down to 2.5million tonnes in 2008.
Anshan Steel aims to produce 18 million tonnes of steel in 2008 up by 16 million tonnes than in 2007. The company is the listed subsidiary company of Anshan Steel group.
Chinese railway sector to see investment gap in 3 years
China Securities Journal quoted UBS Securities in Shanghai as saying that Chinese railway sector will see an annual investment gap of CNY 200 billion in three years.
Mr Wei Qiang vice director of UBS Securities said railways need CNY 1.25 trillion in capital over the five years between 2006 and 2010 but capital expenditures will exceed CNY 300 billion annually over the next three years resulting in an investment gap of CNY 200 billion for the period.
Mr Wei said the Ministry of Railways will inject more capital in three listed companies Daqin Railways, Guangshen Railways and Tielong Container Logistics and attract more commercial capital including private capital.
He said that “It is impossible to issue bonds or loans to fill the gap, explaining that in 2006, the Ministry of Railways’ capital and interest repayments totaled CNY 56 billion far higher than the profit of CNY 3.2 billion.
Container shipping sector on consolidation path
According to a report by the French shipping market research firm AXS-Alphaliner, world’s top 10 ocean carriers account for more than 60% of the global container shipping business.
As per report, between 2000 and 2007, the container volume handled by these carriers tripled to 7.08 million TEUs and their market share rose from 49.3% to 60.6%.
The report added that the world shipping business thus is getting increasingly concentrated in a few hands. This is because large carriers keep expanding their capacity, while the smaller carriers with focus on regional markets and limited financial strength. Larger carrier acquisition of smaller carriers has also led to their higher market share.
China primary aluminum imports down by 9%YoY
Interfax China quoted General Administration of Customs statistics said that China imported 16,419 tonnes of primary aluminum in April up by 203.05% from the previous month while imports for the entire first four months down by 9% YoY to 48,993 tonnes.
MCC and Jiangxi Copper ink copper mining pact with Afghanistan
It is reported that China Metallurgical Group and Jiangxi Copper Corporation signed agreement of Aynak Copper project with Afghanistan government officially.
According to the agreement, MCC and Jiangxi Copper hold 100% mining rights of this project.
Aynak Copper Mine located in Middle East of Afghanistan, is about 35 kilometers from its capital Kabul. The ore reserve of Anyak Copper Mine was 705 million tonnes containing 1.56% copper, the copper metal of this mine was 11 million tonnes.
The annual copper fines ca