JSPL net profit for 2007-08 up by 76% YoY

Jindal Steel & Power Limited has posted net profit of INR 390.33 crore for January to March 2008 quarter up by 92.5% YoY as compared with INR 202.77 crore in January to March 2007 quarter. Total income has increased to INR 1,547.79 crore from INR 1,074.05 crore.

For the year ended March 31st 2008, JSPL recorded a net profit of INR 1,236.96 crore up by 75.9% YoY as compared with INR 702.99 crore during the previous year. Total income has increased to INR 5,459.87 crore from INR 3,548.78 crore.

In the January to March 2008 quarter, JSPL made 457,000 tonnes of steel products up by 65% YoY. For the year ended March 31st 2008, production rose to 1.4 million tonnes from 800,000 in 2006-07.

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.”

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."

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.

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.

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.

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.

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.

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 EUR 3 and EUR 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."

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.

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.

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.

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.

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.

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 freely. 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.

NLC 2007-08 net profit up by 94% YoY

Neyveli Lignite Corporation has posted net profit of INR 1,101.57 crore for the year ended March 31st 2008 up by 94.36% YoY as against INR 566.78 crore for the year ended March 31st 2007. Net sales increased by 41.44% YoY to INR 2,981.65 crore for 2007-08 as compared with INR 2,108.11 crore.

Neyveli Lignite has reported a growth to INR 384.68 crore for January to March 2008 quarter from INR 26.40 crore for January to March 2007 quarter. Net sales grew to INR 801.74 crore for January to March 2008 quarter as against INR 350.23 crore for the corresponding quarter of previous year. It has recommended a final dividend of 10% for the year ended March 31st 2008.

Indian Railways production units perform well in April 2008

It is reported that Indian Railway’s manufacturing units, except Rail Coach Factory and Rail Wheel Factory, have exceeded their respective targets during April 2008.

Name Product Target Actual %F
CLW Electric locomotives 10 10 100.0%
DLW Diesel locomotives 22 22 100.0%
RCF Coaches 130 138 94.2%
ICF Coaches 62 62 100.0%
RWF Wheels 14595 13764 106.0%
RWF Axles 5583 6509 85.7%

The punctuality percentage of mail and express trains was 92.1% in broad gauge and 99.7% in meter gauge during April 2008 as compared to 91.7% and 99.5% respectively during April 2007.

Indian Railways have realized an amount of INR 28.35 crore approximately during the month of April 2008 through ticket checking.

Kirloskar Brothers bags order from NPCIL

Kirloskar Brothers received contracts from Nuclear Power Corporation of India Limited for design, engineering, manufacture, assembly, test, shop painting, packing, forwarding and guarantee of condenser cooling concrete volute pumps, auxiliary sea water vertical turbine pumps, electro chlorination plant, traveling water screens, stop log gates and sea water pump house and electro chlorination building and associated structures for sea water pump house package with a contract value of INR 66.13 crore.

Civil works like design, supply, construction, finishing and handing over of sea water pump house and electro chlorination plants building and associates structures with a contract value of INR 33.11 crore.

ArcelorMittal to complete survey for Jharkhand steel project

Ranchi Express reported that ArcelorMittal is likely to complete survey of 20,000 acres of land for its proposed 12 million tonnes per annum integrated steel plant at Gumla in Ranchi district of Jharkhand. It has roped in Ranchi based consultant Sigma to carry out land scheduling survey in Torpa Kamdara blocks of Khunti and Gumla districts.

The details of land scheduling include forest area, government and non government land and places of religious and historical importance. On the basis of land scheduling report, ArcelorMittal's consultant MN Dastur & Company, which has been appointed for preparing the detailed project report for Jharkhand project, will help the company in selecting the exact areas, to set up steel and power plants, besides a township.

After a final nod to the land scheduling report from MN Dastur & Company, ArcelorMittal is likely to apply for land acquisition to the Jharkhand government. The process for submitting application for acquisition of land for the proposed project may take about a month's time.

Andhra Pradesh to submit report on Coastal Corridor

Projects Today reported that Andhra Pradesh government has been asked to submit a report on the infrastructure development in the proposed Costal Corridor covering the districts of Srikakulam, Vizianagaram, Visakhapatnam and East Godavari district.

An area of 150,000 acres has already been earmarked for the coastal growth corridor project and as part of the first phase 603.58 square kilometer has been identified between Visakhapatnam and Kakinada for investments in various infrastructure projects.

Andhra Pradesh has emerged as one of the prime contenders for the proposed Petroleum, Chemical and Petrochemical Investment Region project which is expected to attract an investment of INR 3,43,000 crore. The other states that evinced interest are Gujarat, West Bengal, Karnataka, Orissa and Tamil Nadu.

Sasan and Mundra UMPP to be fully commissioned by 2013

BS reported that the two 4,000 MW each ultra mega power project at Sasan in Madhya Pradesh, set up by Reliance Power and at Mundra in Gujarat, developed by TATA Power, are likely to be fully commissioned by 2013.

Reliance Power, has committed to the union ministry of power and Central Electricity Authority to advance the commissioning schedule of Sasan UMPP by 3 years. The project, with captive coal mines, was scheduled to be commissioned between May 2013 and April 2016 as per the power purchase agreement. Reliance Power is likely to achieve financial closure for the Sasan project by October 2008.

Reliance Power, has committed the government to advance the commissioning of its first unit by 16 months to December 2011, as against May 2013 as per the PPA. The second unit will come after three months in March 2012.

Meanwhile, TATA Power had achieved financial closure for the Mundra project during April 2008. The first of Mundra's six units are likely to be commissioned by September 2011 and the entire project is slated to take off by March 2013. Mundra UMPP is also ahead of earlier schedule by 11 months for the first unit and by 17 months for the project commissioning.

Jharkhand to remain power deficient state for 4 year – Report

Mr BM Verma chairman of Jharkhand State Electricity Board said that the state would remain a power deficient state for at least the next 4 year and that the board had no choice but to buy power.

Mr Verma, however, said that the situation would improve if the Tenughat power project increased its capacity to 230 MW by the end of May 31st 2008. He added that the much awaited Dumka sub grid would start functioning by the end of October 2008.

Meanwhile, Mr Stephen Marandi deputy chief minister of Jharkhand said that the government is concerned about the power position in the state. He added that his government decided to construct an 800 MW power plant at Ormo Pahari Tola in Amrapara block of district with the supporters of two private companies.

Mr Marandi added that "More than 700 million tonnes of coal has been detected in the Orma Pahari region out of which the Jharkhand would use 437 million tonnes of the coal for the production of power."

Major cement firms plan entry into RMC

BS reported that, barely a fortnight after the French cement major Lafarge acquired L&T Concrete, the ready mix concrete business of Larsen & Toubro and several domestic cement players have shown interest for foraying into ready mix concrete business. Binani Cement, Shree Cement and Dalmia Cement are among the new players who have plans to get into RMC business in 1 to 5 years.

Mr Vinod Juneja MD of Binani Cement said that "We are studying the viability aspect and hope to get into it in the next 18 months. It has a good future in India and we plan to foray organically with our own set up." He added that it already has RMC unit at its Dubai plants. So with that expertise it would be easier for it to start own RMC business in India.

Mr T Venkateshan CEO of Dalmia Cement said that "RMC has a long way to go in the country and we may foray into it in a year's time." He added that demand for RMC is everywhere in India.

Mr KC Birla CFO of UltraTech said that "We are setting up a new RMC plant every fortnight." He added that it has plans to take the number of its RMC units almost to 100 in the next couple of years.

Mr HM Bangur CMD of Shree Cement said that "The RMC market will take time to mature in India. Unless a company has a countrywide presence, it is difficult to compete. Let the market mature then in the next 5 years we will set up RMC plants."

Mr AK Saraugi CFO of JK Cement said that "We have to study and explore possibilities how to go ahead with RMC. But any such initiatives would come only after completing our new cement plant in Karnataka."

At present, there are over 200 RMC plants spread across India with southern region housing more than half of them.

RIL in talks with PSU refiners for KG basin crude

BS reported that Reliance Industries is in talks with state run oil refining companies to sell its crude oil to be produced from MA field in its prolific D6 Block in offshore Krishna Godavari Basin.

A senior executive at RIL said that "Talks are on with all the PSU refiners for selling the MA field crude. We have sought price quotes for the crude."

The RIL executive said that it hopes to finalize crude off take from the field by the end of June 2008. He added that the KG Basin crude is of good quality, but is unlikely to be used at its own 33 million tonne a year refinery in Jamnagar or Reliance Petroleum's upcoming 29 million tonne refinery.

RIL plans to start oil production from the two existing production wells P1 and P2 in MA field later this year. As per the development plan approved by the directorate general of hydrocarbons, RIL is expected to achieve a plateau production of 40,000 barrels a day of oil along with some associated gas.

RIL is the operator of the D6 Block, with 90% stake, while the Canadian company Niko Resources holds the remaining 10%.

Stemcor eyeing stakes in steel projects in India

The Telegraph reported that the UK based steel trading house Stemcor is eyeing minority stakes in steel and raw material projects in India.

Stemcor, which has a turnover of around USD 8 billion is open to stake buys, but does not want to become a manufacturing outfit. Mr William Attenborough MD (West and Southeast Asia) of Stemcor said that “Our primary business is trading. The investments are made to consolidate and enhance that.”

Stemcor already has small stakes in three Indian firms including Calcutta based Electrosteel Castings in which it has a 5% stake, 10% in Orissa’s Mesco Steel and 14.67% in Sathavahana Ispat Ltd.

NLC to set up 2,000 MW power project in Orissa

BL reported that Neyveli Lignite Corporation Limited will set up a 2,000 MW coal based power plant in Orissa in a JV holding a majority stake of 51%.

Mr S Jayaraman CMD of Neyveli Lignite said that "There was some delay in acquiring land, but we are solving it soon." He added that it would implement a coal based 1,000 MW power plant at Tuticorin. A JV firm by NLC and Tamil Nadu Electricity Board would implement the project.

Mr Jayaraman said that "We have tied up with a consortium of banks for INR 2,500. We may go for an additional loan of INR 1,800 crore in 2008."

Neyveli Lignite will also set up a mining project in Orissa in partnership with Hindalco and Mahanandi Coalfields.

1st unit of Krishnapattnam UMPP to start by March 2012

FE reported that Reliance Power has proposed to bring on steam the first 800 MW unit of the 4,000 MW Krishnapattnam ultra mega power project in Andhra Pradesh by March 2012, a year before the earlier plan of September 2013.

Officials at Reliance Power said that "It will make all efforts to advance the commissioning of the first unit well before 68 months since the transfer date of January 29th 2008 and complete the project construction in 93 months. However, the first unit can be commissioned by March 2012 as it will be able to award the boiler turbine generator contract in next 2 to 3 months. It has already awarded engineering procurement construction to Reliance Infrastructure."

Reliance Power sources said that Andhra Pradesh government has so far handed over 70% of the 2.625 acres required. Also, it would implement a relief and rehabilitation package for 175 project affected families.

Maytas Infra bags EPC contract from Gupta Energy

Maytas Infra Limited recently announced that it has won an engineering, procurement and construction contract worth INR 6.5 billion from Gupta Energy Private Limited for India’s first washery reject coal based power plant.

Maytas Infra said that the 120 MW projects, to be set up in the Vidarbha region of Maharashtra, will be completed in 2 stages. The first 60 MW will be completed in 20 months, while the second 60 MW phase will be completed in 22 months.

Mr PK Madhav CEO of Maytas Infra said that "We are extremely proud to be working on this pioneering washery reject coal based power plant. We at Maytas regard this as a great achievement to have been chosen from among major competitors for this prestigious project. This is a new kind of technology being adopted by us and it reinforces the fact that we are leaders in our chosen domain. This project will also see the highest efficiency, high standards of safety, and will meet the best environmental norms."

Maytas Infra has undertaken projects in buildings and structures like the Byrraju Foundation, Singapore Class Township and Maytas Hill County in Andhra Pradesh.

Protest may delay ArcelorMittal steel plant in Orissa

Kalinga Times reported that after mega steel plant projects in Orissa of POSCO and TATA Steel have been delayed for years because of the local protest against land acquisition, ArcelorMittal could be join the bandwagon. Actually, the delay is quite evident as local protests have begun in the Keonjhar district of Orissa.

The protestors recently said that they would lose more than 800 acres of agricultural land on which they are dependent. They argue that the plant should be set up on barren lands. Mr Muralidhar Sardar president of Mittal Pratirodh Manch said that "We want better irrigation for our agricultural land, for our better livelihood. We do not want the Mittal steel plant, which would take away our land and thus our livelihood. We are ready to die but would not allow the plant on our land."

The report also cited Mr Vijay Bhatnagar CEO of ArcelorMittal India as saying that "We target to start the plant by 2012. But if there is any delay in starting the work then this would add to the date of commencement of the plant."

Anticipating the tussle, ArcelorMittal has started workshops for the first time in Keonjhar to convince the people about the benefits of the steel project. But they have a tough job on hand. The project would displace nearly 15,000 people in 17 villages in Patna Tehsil of Keonjhar.

ArcelorMittal signed the MoU with the Orissa government on December 12th 2006 and it now intends to start the project work on the ground. The project requires 8,000 acres of land.

Bhuwalka inks JV with Soul Space Realty for Bangalore

It is reported that Bhuwalka Steel Industries Limited has entered into joint development agreement with Soul Space Realty Limited pursuant to the MoU on November 22nd 2007 for joint development of Bangalore property, where presently a TMT mill is situated.

As per the joint development agreement, the Bangalore property measuring more than 9 acres shall be developed by Soul Space Realty Limited for commercial and retail purpose.

As per present guidelines, about 1.3 million square feet area may be built up and 40% of the same shall accrue to the company and 60% shall be retained by the developer. This will result in unlocking value of assets in the company. The value of property accruing to the company after the development will be about INR 125 crore and the company expect a rental income of INR 12 crore per annum in future.

The developer shall also pay interest free refundable deposit of INR 11.50 crore to Bhuwalka Steel, which will be refunded at the time of handing over of developed area. Of this amount, it had already received INR 8 crore.

Mr Ratan Tata in 30 most powerful list of UK constructions

Indian business icon Mr Ratan Tata, already named among the world's most influential business people from India, has now made to a list of 30 most powerful in the British construction space.

According to the list compiled by UK based digital magazine Contract Journal, Mr Ratan Tata has been placed at the 16th position, ahead of housing minister Mr Caroline Flint, who is at the 18th place. Mr Ian Tyler of engineering and construction services provider Balfour Beatty topped the list, followed by Mr Simon Williams director of cartels at Office of Fair Trading and Mr Ray O'Rourke chairman of private construction firm Laing O'Rourke.

The report said that "Already providing products that feature in many British homes after its takeover of Tetley in 2000, TATA Group now supplies the mainstay material in most of its offices."

The report said that TATA’s joint entity known as TATA Corus has a 50% share of the UK market. It added that "Such is its dominance that steelwork contractors have nowhere to turn when it pushes through price rises. With prices set to surge further as input costs continue to rise, Mr Tata could have a major impact on construction costs."

Elecon scouting for acquisitions in Europe - Report

BL reported that Gujarat based Elecon Engineering is in talks with a European company for an acquisition seeking to establish a global footprint. It is also looking to expand its material handling equipment and gear box division in the overseas market.

Mr Prayasvin Patel CMD of Elecon Engineering said that "We are looking to buy a company which will be about 60% to 70% of our market cap. The discussions are at an early stage and it would not be fair to elaborate on it." He added that a proposed European foray will give it an established network outside India and a high margin customer base.

Meanwhile, Elecon Engineering has also announced an investment of INR 182 crore for 2008, which will be used to upgrade and enhance capacity at its manufacturing location in Vallabh Vidyanagar in Gujarat. About INR 100 will be specifically invested in expanding capacity for the wind mill gear box facility.

Elecon makes stackers, re claimers, elevators, chain conveyors, ship loader, crawler and rail mounted trippers, gear boxes among other products. It has not made it clear whether the target company will form synergies with its material handling equipment division or the gear box division.

TATA Steel and Essar in race for PT Krakatau Steel

As per media reports, Indonesia's state owned Krakatau Steel has 5 highly eligible suitors including ArcelorMittal, TATA Steel, Essar Steel, BlueScope Steel and POSCO.

Mr Ansari Bukhari director general for metal, machinery & textiles of Indonesia said that the first four namely ArcelorMittal, TATA Steel, Essar Steel and BlueScope had evinced interest, while Mr Sofyan Djalil enterprises minister of Indonesia had mentioned POSCO's name.

However, POSCO said that ''The Indonesian government has not announced details of a privatization plan for Krakatau Steel yet and we have not expressed interest in the company.''

According to Indonesian vice President Mr Jusuf Kalla, Krakatau has not been able to raise its production capacity due to lack of funds and technology. This causes Indonesia to import 6 million tonne per annum. Mr Kalla said that it was not possible for Krakatau Steel to make profits if it did not engage in the steel industry from the upstream to the downstream levels like Mittal or TATA and other steel industries in the world.

Krakatau Steel produces 2.5 million tonnes per year and is valued at USD 1.2 billion. In 2007, Krakatau Steel posted a net profit of around IDR 370 billion. In the first quarter of 2008 alone, the figure already reached IDR 400 billion.

BHEL and Ansaldo in race for NLC boiler supply

BL reported that Bharat Heavy Electricals Limited and Italian power major Ansaldo are in the race for supplying boilers to Neyveli Lignite Corporation’s Tuticorin project. The value of the order would be around INR 1,300 crore.

As per report, a JV of Neyveli Lignite Corporation and Tamil Nadu Industrial Development Corporation is investing INR 4,950 crore in the 1,000 MW, coal fired thermal project.

The value of boilers and turbines for the project works out to around INR 2,200 crore. NLC invited expression of interest for each equipment. BHEL was the sole respondent for supplying the turbines, whose value would be around INR 900 crore.

Mr S Jayaraman CMD of Neyveli Lignite said that the project would not use supercritical boilers, which, though costlier, are said to be more energy efficient. He added that the Tuticorin project is NLC’s first foray into coal fired power plant and as such the company would not like to go in for the super critical.

Visa Steel 2007-08 net profit up by 27% YoY

Visa Steel has posted net profit of INR 20.99 crore for January to March 2008 quarter up by 3129% YoY as against INR 6,500,000 in January to March 2007 quarter. Revenue for the quarter rose by 78% YoY to INR 259.68 crore as against INR 145.98 crore.

Visa Steel has also recorded INR 682.81 crore revenue for the financial year ended March 31st 2008 up by 26.9% YoY as against INR 537.93 crore in the year ended March 31st 2007. Net profit for the year increased by 110% YoY to INR 43.15 crore from INR 20.52 crore.

Mr Vishal Agarwal MD of Visa Steel said that " The growth in revenues and profit for 2007-08 fiscal have been driven by better realization in products like pig iron, coke and ferrochrome combined with higher volume growth in the coke and ferrochrome operations."

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.

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.

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.

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.

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)

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.

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.

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.

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.”

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)

Chung Hung Steel to raise HRC price

Taiwan’s Chung Hung Steel is expected to raise prices on hot rolled coil by at least TWD 1,500 per tonne for June 2008.

Chung Hung Steel only raised its price by TWD 400 per tonne in May in considering of take care their downstream customers. But the increase seems didn’t fully reflect the cost. Initially, the company intended to increase by TWD 500 per tonne but the possibility is very low now.

(Sourced from YIEH.com)

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.

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.

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)

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."

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.

US weekly crude steel production increase by 0.8%YoY

American Iron & Steel Industries reported that in the week ending May 24th 2008, US’s raw steel production was 2.140 million net tons while the capability utilization rate was 89.7%. Production was 2.121 million net tons in the week ending May 24th 2007, while the capability utilization then was 88.4%. The current week production represents 0.8% increase from the same period in 2007.

Production for the week ending May 24th 2008 is down 0.2% from the previous week ending May 17th 2008 when production was 2.146 million tons and the rate of capability utilization was 89.9%.

Adjusted YTD production through May 24th 2008 was 43.876 million tons at a capability utilization rate of 88.8%. That is a 3.1% increase from the 42.520 million tons during the same period last year, when the capability utilization rate was 85.1%.

District wise production for the week ending March 15th 2008
1. Northeast Coast: 182
2. Pittsburgh/Youngstown: 212
3. Lake Erie: 84
4. Detroit: 93
5. Indiana/Chicago: 512
6. Midwest: 264
7. Southern: 695
8. Western: 98
(In thousands of net tons)

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

Kobe Steel to construct testing facility for compressors

Kobe Steel Ltd announced that it has begun construction of a large capacity compressor testing facility at its Takasago Works at Hyogo Prefecture in Japan. Kobe Steel plans to invest JPY 4.1 billion in the new facility, which will go into operation in April 2010.

The new facility will be able to test large capacity rotating machinery, mainly turbo compressors, with variable speed motors rated up to 20,000 kW. Kobe Steel's testing capacity will increase by 50% in comparison to the current level. Testing facilities are essential to confirm the design performance of compressors, a major product of Kobe Steel's Machinery segment. The new testing facility will enable Kobe Steel to enter the large capacity turbo compressor market.

Kobe Steel anticipates that numerous projects in the future, both in Japan and overseas will need large turbo compressors. Two examples are oxygen plants in steel mills and the manufacturing of liquid crystal displays. Kobe Steel estimates that it currently has a 10% share of the world market for the integral gear variety of turbo compressors. The company anticipates that by expanding into large capacity compressors, it will be able to gain a 20% share of the integral gear compressor market in the future.

In the Kobe Steel Group's Machinery segment, business has been brisk from the oil refining, petrochemical and energy industries. In recent years, Kobe Steel has been developing the global market including the United States, Europe, China and the Middle East. It has also been supplying compressors of higher pressure and with larger capacities. Owing to strong demand, Kobe steel doubled total compressor sales to 700 billion yen between fiscal 2002 and fiscal 2007. Sales in fiscal 2008 are also anticipated to increase further.

Nippon Steel sees market stronger than expected

Reuters cited Mr Akio Mimura chairman of Nippon Steel Corp as saying that the demand in the global steel market has been stronger than expected and reiterated that its earnings forecasts for this business year were conservative.

Mr Mimura told a small group of reporters that "Generally speaking the market is much better than we expected adding that there have been no signs of a buildup of inventories in China or the United States.”

Nippon Steel last month forecast a 34% fall in group pretax recurring profit to JPY 370 billion (USD 3.56 billion) for the year to March 2009, hit by soaring raw materials prices.

South Korea takes measures to ease fuel costs

Yonhap reported that the South Korean government will expand fuel subsidies for the country's underprivileged to ease the burden of soaring oil prices.

South Korean government officials said that Seoul has been seeking to overhaul its energy policy in the face of a rise in oil prices which have been forcing the government to come up with measures to buffer their impact on the economy and local consumers especially those in the low-income bracket.

In a meeting presided over by Mr Han Seung soo PM of South Korea high ranking officials agreed to extend the provision of current oil subsidies for cargo trucks and introduce the so called energy voucher system.

Mr Han said that "Oil prices are climbing fast much faster than expected. We must come up with specific measures to relieve the ensuing burden on the underprivileged, who have been suffering in particular."

The government plans to finalize the measures after discussing them with the incoming parliament whose term begins Friday.

Oil costs rocketed to a record above USD 135 a barrel last week, double the cost a year ago and that of liquid natural gas also rose more than 20% during the same period. South Korea depends on imports for most of its energy consumption as the world's fifth largest oil buyer.

European rebar and wire rod prices continue to surge

It is reported that rebar and wire rod price in Southern Europe has continued to raise by EUR 100 per tonne compared to it was in the beginning of May. The main reason is due to soaring global scrap price.

Current rebar price is prevailing at EUR 750 to EUR 850 per tonne and the wire rod price is about EUR 750 to EUR 820 per tonne. Now with the price rising further, buyers have stopped purchasing to wait and see what will happen.

(Sourced from YIEH.com)

Hyundai Steel restarts electric furnace

South Korea's second largest steelmaker, Hyundai Steel has resumed its idle 70 tonne electric furnace at Incheon on May 13th 2008

The move was made to meet the growing demand of the H beam. The furnace has been closed in December 2002, which has annual production capacity of 600,000 tonnes.

There are six furnaces at the Incheon plant, with crude steel production of 4.1 million tonnes. In addition, Hyundai Steel also plans to restart a 50 tonne electric furnace.

(Sourced from YIEH.com)

ArcelorMittal hikes beam prices

ArcelorMittal has announced to increase its base price for beams and sections for the third quarter, because of escalated raw material, energy and logistics costs.

According to ArcelorMittal, the base price will be raised by EUR 40 per tonne. It said that for the second quarter it has increased by EUR 30 per tonne.

Scrap surcharge has risen by EUR 200 per tonne since January for beams and sections.

Metso opens a new research center in Finland

Metso Minerals announced that it has inaugurated a new Research Center in Tampere. Activity at the new center will further strengthen Metso’s global knowledge base in crushing and screening technology, and research and testing services which benefit global construction and mining markets will be on offer.

Located in southern Finland, the new center includes a state of the art test facility with a fully equipped rock laboratory for analyzing rock samples. Testing routines will enable Metso Minerals to design crushing and screening processes that are a precise match for customer needs in terms of process capacity, energy efficiency, end-product characteristics and yield. As well as enhancing Metso Minerals’ research and development activities, the new center will also shorten new-product development lead-times.

First announced in 2006 as part of a larger expansion plan, the Metso Minerals Research Center will eventually employ 20 people. The driver behind these investments is strong global demand for efficient and environmentally sound crushing and screening solutions and the overall level of activity in the construction and mining markets.

The new Research Center represents an investment totaling some EUR 3 million and is the largest single investment that Metso Minerals has made in research and development to date. The ability to provide the construction and mining industries with new, efficient crushing and screening solutions is becoming of increasing importance.

Peru national union mulls new strike call

BNamericas reported that Peru's national mining and metalworkers federation FNTMMSP is contemplating calling a strike following weeks of congressional debates over reforms demanded by the union.

A source with the federation told BNamericas that congress has been reviewing legal amendments and additions on outsourcing, participation in profits and pensions for mine workers in the past weeks in what the federation considers stalling.

The federation suspended a call for a nationwide strike on May 12 to give the congress time to pass the reforms in question but now said that it feels lawmakers are taking too long.

The union source said the federation plans to make another call for work stoppage in June.

Japanese exports of CR strip in March

It is reported that Japan exported 302,436 tonnes of cold rolled width strip in March 2008 at an average price of USD 734.7 per tonne. Japan March 2008 export to different countries are

(Volume in tonne)
(Price in USD per tonne)

Dowa Metanix to expand output by 40% by 2010

JMB reported that Dowa Metaltech group's rolled copper maker, Dowa Metanix expends around JPY 2 billion for new pickling line and facility renewal in fiscal 2008 started April.

As per report Dowa Metanix expands the monthly output capacity by 40% to 1,200 tonnes in fiscal 2010. The firm tries to improve the productivity to expand the supply for connector pin and semiconductor lead frame

Metso acquires the LignoBoost AB

Metso and STFI Packforsk AB announced that they have signed a purchase agreement regarding the shares of Lignoboost AB a Swedish research company. The transaction includes all the intellectual property rights as well as the LignoBoost brand and its related know how. Personnel or facilities are not included in the transaction.

In addition Metso and STFI Packforsk have signed a research and development agreement related to LignoBoost technology. Both agreements come into force with immediate effect. The value of the transaction will not be disclosed. The acquired company will become part of Metso Power, a part of Metso Paper business area.

The acquisition supports Metso's profitable growth strategy and opens an interesting biofuel business opportunity within pulping processes.

LignoBoost represents a technology that extracts lignin, a component of natural wood from the chemicals used in the pulping process. The extracted lignin can be used as biofuel replacing coal and oil ie in pulp mill's power generation or in lime kilns. LignoBoost gives Metso's customers the possibility to increase the capacity of a pulp mill and turn pulp mills into significant energy suppliers. At the same the extracted lignin is also of interest for other process industries as a raw material for plastics, coal fibers and chemicals.

The LignoBoost technology has proven its technical maturity over several years of research and laboratory testing as well as during operation in an industrial size demonstration plant integrated into the pulping process of Nordic Paper Bäckhammar, Kristinehamn, Sweden. The demonstration plant will remain in the possession of STFI Packforsk.

Mr Lennart Ohlsson president of Metso Power said that "We see great value in getting a process with such high future expectations. It complements our present solutions offering in an excellent way. LignoBoost has the best chances of being further commercialized for industrial applications in a global company such as Metso.”

Tung Ho Steel orders mechanical equipment from SMS Group

Taiwan’s Tung Ho Steel Enterprise Corporation announced that it has ordered mechanical equipment from SMS Group for a total amount of EUR 44.763 million.

The mechanical equipment includes electric ovens and refining ovens with a total value of EUR 14.943 million, continuous casting machines with a total value of EUR 6.760 million as well as rolling machines with a total value of EUR 23.060 million.

Egypt to set new rules to control steel prices

Daily Star Egypt reported that Egypt’s ministry of trade & industry has introduced new rules this week that aim to cool rapidly mounting steel prices by making steel sellers comply with price limits set by their producers.

The new rules allow producers to quote a resale price ceiling to their retailers and stop trading with them if they exceed it. Under the new rules, producers must report their maximum rates to the ministry of industry within the first week of each month so that the ministry can pinpoint where price speculation is occurring.

Mr Haytham Gammal a senior researcher at Egyptian Competition Authority said that while, overcharging can hinder competition, it is not explicitly illegal here as it is in the United States. He added that "Charging too much, in itself, is not a violation. According to this principle, we cannot declare any person or any economic operator in breach of the law without an express provision in competition law."

Mr Gammal said that the ECA will wait to see if the new measures help lessen speculation before they consider doing more. If the rules are not effective, they may consider pushing for an amendment to outlaw excessive pricing. This would be a controversial step. Economic opinion, even in markets that outlaw excessive pricing, often splits over whether such limits are ultimately in consumers’ interests.

Ezz Steel 2007 net profit up by 12% YoY

Egyptian steel major Ezz Steel has reported a 12% YoY rise in its net profit to EGP 1.1 billion for 2007 due to higher global steel prices. Its net sales rose by 40% YoY to EGP 16.2 billion and core earnings were up by 8% YoY at EGP 3.9 billion and total annual production stood at 5.3 million tonnes.

Mr Ahmed Ezz MD of Ezz Steel said that "These results should be viewed in the context of a highly dynamic global steel market. Internationally, steel prices rose considerably during 2007, and continue to do so."

Ezz Steel, which derived almost 74% of its sales in 2007 in Egypt, signed a deal to build a USD 750 million steel plant in Algeria in October 2007.

Ezz has benefited from a surge in construction projects in the Middle East region as oil prices hit records. Demand in the Middle East and North Africa grew up by 12% to 38.1 million tonnes in 2007. Demand for steel in Egypt jumped by 15% YoY in 2007 as compared to 4% YoY in 2006, on more real estate and infrastructure projects.

Turkish billet export prices climbing to unheard levels

It is reported that Turkey’s billet export prices are continuing to rise, following strong demand from the Middle East region.

As per reports, current export steel billet price has risen by USD 70 per tonne to reach USD 1,130 on FOB basis for July 2008 shipment.

Local analysts have forecast that billet price will be increased further because strong demand will be seen for ongoing projects in Dubai. Besides, buyers are forced to accept higher prices in order to secure stable supply.

Construction projects in Saudi Arabia hit by high steel prices

Arab News reported that the spiraling steel prices in the local market has halted or slowed down several vital construction projects in the Saudi Arabia.

Mr Shareef Abu Auf chief of Al Haramain Company for Contracting said that "The situation is so bad that we do not get enough quantities of steel to complete the expansion of the Haj Terminal lounge at the King Abdul Aziz International Airport in Jeddah. Other vital projects such as the works at the King Abdul Aziz University and many plants in Rabigh are affected by the high price of steel."

Mr Abu Auf warned that public works in Jeddah where most major roads are being converted to underpasses and overpasses would seriously be hampered by the steel shortage. He blamed the steel distributors who hoard steel and other black marketers for the current shortage and consequent spurt in price. He demanded that SABIC and other national steel mills to stop exports so that the local demand, which is estimated at 11 million tonnes annually, be met.

Mr Ayman Shaqlaih director of Al Fouzan Iron & Building Materials Company said that the sharp increase in the demand for steel and iron in the domestic and international markets is among the major factors that send the prices up besides the rise in the price of raw materials. Another factor is the dwindling supply of scrap.

Mr Shaqlaih also attributed the shortfall in the domestic market and rise in the price of steel to the contractors and traders in the neighboring Gulf countries, who used to buy heavily from the cheap Saudi market. He dismissed the charge that SABIC distributors were hoarding steel expecting further rise in the price as baseless. He agreed that the superior quality of SABIC steel deserved a higher price in the market. He added that "It is the cheapest steel available in terms of prices. While SABIC’s 16mm steel is priced at SAR 4,060 per tonne other companies sell it at SAR 4,650."

Abu Dhabi plans major transport projects

Reuters reported that Abu Dhabi is planning to build a transport network including a new airport and railway system to connect its western region with neighboring emirates and stimulate the area’s economy.

Mr Mohamed Hareb al Yousef assistant undersecretary of aviation at Abu Dhabi’s Department of Transport said that a master plan, to be ready by early 2009 at the latest, would outline details of the transport network and the investments to be made.

Mr Yousef further added that "The master plan includes plans to have another airport in Abu Dhabi’s western region. The Abu Dhabi Airports Company will take steps to build the airport."

In 2005, the Abu Dhabi government set up the Western Region Development Committee aimed at developing the region economically and socially. The region covers 70% of the United Arab Emirates and almost 85% of Abu Dhabi emirate. The region was home to about 10% of Abu Dhabi’s population and generated 34% of the emirate’s gross domestic product in 2005.

Kuwaiti rail and metro project awaiting approval

MEED reported that a full proposal for Kuwait's USD 14 billion rail and metro project will be presented for approval to the prime minister within weeks.

If government approval can be secured swiftly for the project and a decision taken on the ownership of the five special purpose companies soon, Kuwait Overland Transport Union officials hope to begin issuing tenders by the end of 2008. The rail and metro projects are scheduled to be finished by 2014.

Mr Saeed Dashti chairman of Kuwait Overland Transport Union said that "The study has been completed, it just needs the approval of the prime minister and there has been a slight delay because of the elections. The numbers stand. There has been no change to the cost of the project."

The scheme is divided into two distinct projects, both costing about USD 7 billion. A new 505 kilometers long railway network will be built from the capital extending to the country's borders with Iraq and Saudi Arabia. It is anticipated this will eventually form part of the GCC rail network that will extend down the east coast of the Arabian Peninsula and round to the border with Yemen. At the same time, a 171 kilometers long inner city metro project will result in four lines being built across Kuwait City, linked to the new rail network on the outskirts of the capital. About 60km of the metro will be built underground.

The presentation of a recently completed feasibility study was delayed while parliamentary elections were held on May 17th 2008. Following this, Mr Sheikh Nasser al Mohammed al Sabah was reappointed as prime minister on May 20th 2008 and once a new cabinet has been put in place, the project is expected to move forward.

Iran and Pakistan to resume talks on IPI pipeline project

Fars News Agency reported that Iran and Pakistan will resume talks in Teheran over the proposed USD 7.4 billion pipeline to transport natural gas from Iran to India and Pakistan.

As per report, signing of the purchase agreement could be delayed following the political uncertainty in Pakistan and the resignation of Mr Khawaja Muhammad Asif oil minister of Pakistan.

Iranian President Mr Mahmoud Ahmadinejad said on April 30th 2008 that ministers from the three countries will complete an agreement on the pipeline within 45 days and present it to the leaders of the three nations.

Dubai sets tough health rules to protect laborers

UAE daily The National reported that stringent health and safety rules will be introduced to protect laborers on Dubai’s construction sites. Affordable and accessible basic care will be provided as a matter of course, under plans by the Dubai Health Authority, which aim to prevent workers becoming seriously ill and placing further pressure on the health service.

Mr Qadhi Saeed Al Murooshid director general of Dubai Health Authority said that "For me, occupational health is a top priority. We want to impose more rules and standards." He added that a major overhaul of the health system would be announced in the coming months.

Mr Al Murooshid said that "We cannot afford to leave out any segment of the community. We will be looking after everyone, from the top chief executive to the unskilled worker. We need to protect their health. To prevent the problem on construction sites we will be saving lives, saving their health and also saving hospital beds." He added that although some firms had been proactive in health and safety, the emirate had a long way to go before construction sites become sufficiently safe.

Aramco to invest USD 129 billion into new projects

Reuters reported that Saudi Aramco is planning to pump USD 129 billion into new energy projects over the next 5 years as it looks to boost crude, gas, refining and petrochemical capacity.

Mr Khalid Al Falih executive VP of operations at Aramco said that around USD 59 billion of the planned investment would come from Aramco itself, while the remaining USD 70 billion would come from JVs.

Mr Al Falih said that "We are updating our figures all the time. This figure includes more projects. This includes refinery projects in the United States and China, a second phase of the Saudi based PetroRabigh, and a giant petrochemical plant at Ras Tanura to be built by Dow Chemical."

He said that Aramco is focused on developing and expanding its downstream operations. On soaring oil prices, he said that the market was being driven by speculators and not supply and demand. He added that "Buyers and sellers are taking their cues not just from production numbers, demand projections and inventory levels, but from a whole host of factors which lie beyond the realm of the petroleum industry itself."

Gulf cooling market to reach USD 30 billion in 10 years

According to research conducted by MEED, the Middle East district cooling market is set to grow up to USD 30 billion in ten years. Experts who participated in a conference on district cooling felt that as governments strive to become more sustainable and deal with increasing energy prices, district cooling has become essential for all new projects.

Mr Edmund Sullivan chairman of MEED said that "With more than USD 2 trillion worth of projects underway in the region, there has never been a greater need for efficient air cooling systems."

District cooling services significantly reduce both energy costs and the environment impact by reducing the amount of power required and increasing efficiency.

The participants also discussed the challenges being faced by the district cooling industry. They cited the issues of infrastructure support needed for all utilities and financial support.

Tabreed to double capacity in 2009

UAE based cooling Tabreed said that it expects to double capacity next year to 1 million tonnes refrigerant, with most of the extra capacity to be added in the United Arab Emirates.

Mr Karl Marietta deputy CEO of Tabreed said that "The district cooling industry is going to be on a fast growth rate for a few years." He added that Tabreed, which builds cooling, and air conditioning systems, plans to manage about 500,000 tonnes refrigerant by the end of 2008 and as much as 1.5 million tonnes by the end of 2010.

He said that most of the growth will be in Abu Dhabi, but it is also building plants in Ajman and Fujairah and expanding a plant in Ras al Khaimah.

Deyaar launches Mirar project

UAE Business reported that real estate company Deyaar has launched Mirar Residences, a three tower residential project at Dubai Biotechnology and Research Park. The 22 million square feet biotechnology park is located at the heart of New Dubai and is a member of Tecom Investments.

Strategically positioned within minutes of Sheikh Zayed Road, Deyaar’s latest residential offering consists of three 19 storey towers scheduled for delivery in the fourth quarter of 2010, with construction already underway. Conveniently located off Umm Suqeim Road, residents of Mirar Residences will enjoy easy access to the emirate’s major gateways, Sheikh Zayed Road, Emirates Road and Al Khail Road.

Mr Saeed Al Qatami MD of Deyaar said that "Fresh from the success of our recent Oakwood Residency project in International Media Production Zone, which sold out within a day of its launch, we expect to experience another swift sell out with this new offering. At Deyaar, we have consistently been at the forefront of new high-potential master developments. Mirar Residences is one of the first residential offerings in the centrally located DuBiotech Park. Our customers will again reap the rewards of Deyaar’s strategic foresight and expertise by becoming one of the first proud homeowners in this high-potential master development."

Located in close proximity to five star hotels, a number of shopping malls and key business hubs such as JAFZA, Dubai Media City and Dubai Internet City, the project will also be conveniently served by the second stage of the Dubai Metro.

Abu Dhabi and Dubai to get high speed rail link

Arabian Business reported that Abu Dhabi is in talks with Dubai about connecting the two emirates via a high speed rail link.

Mr Abdulla Rashid Al Otaiba chairman of Abu Dhabi Department of Transport said that it is having conversations with Roads & Transport Authority about connecting Abu Dhabi and Dubai via the railway.

The Department of Transport's five year plan calls for the development of a high speed rail network, a metro and light rail network. It also calls for the construction of new roads, the introduction of water taxis, an upgrade of the emirate's fleet of buses and the continuation of its open skies policy to increase air traffic. The RTA is planning up to 8 metro lines that will link major destinations across the emirate.

Dubai is in the process of constructing its own metro, with the first two lines, red and green, expected to come online in September 2009 and March 2010 respectively. The red line will run from Al Maktoum International Airport in Jebel Ali, around the American University, through the city centre, and to the Airport Free Zone. The green line will run from Festival City, through the city centre, on to service Dubai International Airport Terminals 1 and 3, and finishing in Rashidiya. A blue line has also been earmarked to run along Emirates Road, although the exact route is currently unknown, and a fourth purple line will connect Dubai International Airport with Al Maktoum International Airport.

Amana Contracting to build TAKREER

Abu Dhabi National Oil Company has awarded Amana Contracting & Steel Buildings the contract to build the TAKREER Research Center at Sas Al Nakhl in Abu Dhabi.

The facility covers an area of approximately 6,000 square meters and consists of laboratories, workshops, a pilot plant, gas bunker and offices. As per ADNOC’s requirements, all glazing, fittings and doors will be blast proof.

Amana Contracting & Steel Buildings is a leading regional turnkey contractor. With 12 operational offices in the Middle East, Amana provides to its clients that unique combination of local knowledge coupled with regional reach. Amana is the regional leader in its ability to deliver turnkey solutions for extremely time sensitive industrial and commercial projects on time, within budget and with the quality requirements.

ALEC bags AED 3.4 billion contract for developing Dubai WTC

It is reported that ALEC has been awarded the AED 3.4 billion contract to build the first phase redevelopment of the World Trade Centre in Dubai.

The project involves the construction of 7 towers with 242,000 square meters of offices, a 35,000 square meter four star hotel, a 22,000 square meter three star hotel, 20,000 square meters of retail space and a four level, 110,000 square meter basement. The total built up area is about 1 million square meters. The scheme also involves a five star hotel tower, which is expected to be tendered separately, and a substation that will be built by Dubai Electricity & Water Authority.

The other bidder for the contract was Australian Nasa Multiplex. The local Middle East Foundations has been awarded the piling contract. Khansaheb is already working on the excavation package. The UK's Mace International is the project manager. Hopkins Architects is the consultant and another UK based firm WSP, is the structural, mechanical and electrical engineer.

Iran and South Africa to discuss shipping cooperation

Mathaba News reported that Iran and South Africa joint cooperation meeting on ports and maritime opened in Tehran recently.

Mr Alireza Satei deputy head of Ports & Shipping Organization for ports and special zones affairs noted that the three day meeting aims to develop bilateral shipping cooperation.

He called for boosting shipping cooperation particularly in the fields of commerce shipping, bolstering the technical cooperation, ship building and developing maritime infrastructures as the other objectives of the meeting.

Mr Satei further added that "The MoU on control and inspection, search and rescue, marine certification will also be discussed in the meeting."

Zamil Steel unveils new technology for steel plates folding

Zamil Steel has uncovered its new technology in the steel works industry by revealing the first new machine in the local and regional markets with the ability to fold the steel plates with thicknesses of up to 285mm. This new technology will open new pathways in terms of techniques and applications, as well as products and processes of Saudi factories.

Mr Adnan Al Mansour president of Zamil Steel said that the industrial sector in the Kingdom has played a significant role in this new development by supporting Saudi exports through the establishment and operation of local factories in compliance with global standards.

He added that "The new machine provides a strong impetus in the steel works sector to ensure new applications during the next stage, as with this machine we are able to roll up steel plate thickness up to 200mm, with more than 3 meter width and 3 meter diameter, using cold rolling process."

He further added that "Such an ambition has been realized thanks to the understanding, perception and awareness of Saudi industrialists who emphasized the necessity of devoting the necessary resources, material and experience to result in a radical shift of the technical concepts and technology by pumping billions of riyals into research and development. The end result can be seen in the development of several products that were deemed to be technologically impossible just a short time ago."

Cement production shifting to East Asia –Report

According to a study report by Prime Holding, North America and Western Europe remain among the world's largest cement producers but the focus of production is shifting to the Middle East and East Asia due to their aggressive construction activities.

As per report, protracted negative fallout from the credit crunch on the real estate markets of the West could well exacerbate the change in cement market dynamics further over the short to medium term. Exporters in East Asia, India, Pakistan and Egypt are capitalizing on cement shortages across the GCC. East Asia is currently the world's largest producer and consumer, accounting for 58.8% and 56.9% of the global aggregate, respectively.

The report said that "It is also positioned as one of the most efficient cement producing regions and traders worldwide with utilization rates of 94% in 2006 and a 48.2% market share of world exports."

While China dominates the region's production and consumption figures, other producers including Indonesia, Japan and Thailand are increasingly establishing a footprint on the world cement stage. The region also has a direct effect on the cost of cement production. China's cement market prices have risen from USD 58 per tonne in 2005 to USD 70 per tonne in late 2007.

East Asia nevertheless remains one of the world's most cost effective producers due to economies of scale achieved through large-scale mass production and access to cheap labor.

In India the unprecedented increase in construction activity catalyzed by the ongoing real estate boom has pushed cement prices up from less than USD 62 per tonne at the end of 2005 to more than USD 75 at present.

Pakistan had a production capacity of 33 million tonnes per annum at the end of 2006 with a relatively low utilization rate of 60%. Sector dynamics have begun changing recently as political tensions in nearby Afghanistan are easing and restructuring efforts have transformed the latter into a major recipient of Pakistani cement. With increasing Indian demand for cement exports and with other Middle East nations also requiring imports to meet supply shortages, utilization rates are expected to pick up gradually.

Iran is widely expected to become a major exporter to the GCC as well as to Afghanistan and Iraq. It enjoys an abundance of both raw materials and energy components required for production, which has allowed the country to maintain prices at USD 55 per tonne. Iran's cement production capacity is estimated at 45 million tonnes per annum after a wave of new production facilities came on line in the first quarter of this year.

The Turkish cement industry, with a production volume of 52.5 million tonnes per annum, is poised to become one of the 10 largest producers in the world. Additional capacity is expected to add a further 10 million tonnes per annum this year.

Egypt's cement sector has witnessed significant changes over the past two years as an environment of lower prices on the back of cheaper subsidized energy saw the country convert itself into a major cement exporter. The government has issued licenses for 8 new factories with production capacity of 13.5 million tonnes per annum, bringing Egypt's total capacity to 55 million tonnes per annum by 2010.

Bahrain to import 1 BCFD of natural gas from Iran

Gulf Daily News reported that Bahrain is planning to purchase 1 billion cubic feet of natural gas every day from Iran.

Mr Abdulkarim Al Sayed CEO of Bahrain Petroleum Company said that Bahrain already consumed an average of 1 billion standard cubic feet of natural gas every day. He added that it needs to expand its supplies of natural gas because of the massive amount of development taking place in the country.

Mr Al Sayed said that it was required to produce electricity for the country's expanding infrastructure, as well as support the industrial sector. He added that "The additional gas is to meet increasing demand from projects. Many companies require gas. As the country develops, we will need more gas to produce electricity. We are exploring the possibility of importing gas from Iran, Qatar and other countries. We also want to enhance gas production in Bahrain from our reservoirs."

Aramco 2007 daily oil output down by 4.5% YoY

Khaleej Times reported that Saudi Aramco's oil output for 2007 fell by an average 400,000 barrels per day from 2006, after Saudi Arabia cut output in line with OPEC agreements.

Aramco's total crude oil exports reached about 2.41 billion barrels in 2007 down by 5.1% YoY from 2.54 billion barrels it exported in 2006. Average daily oil production reached 8.5 million barrels per day in 2007, resulting in a total production of 3.11 billion barrels for the whole year as against 3.25 billion barrels in 2006.

Aramco's gas production totaled 2.92 trillion cubic feet in 2007 down from 3 trillion cubic feet in 2006 and natural gas liquids production slipped to 394.6 million barrels from 399 million barrels in 2006. With 2 new finds, Saudi Arabia maintained its recoverable crude oil and condensate reserves unchanged at 259.9 billion barrels in 2007.

Refined products output in 2007 declined to 571.06 million barrels from 595.66 million barrels. Aramco exported 136.01 million barrels of refined products in 2007 down from 183.96 million barrels in 2006.

Saudi inflation to rise further – SAMA Report

Saudi Arabian Monetary Agency, in its latest report, said that inflation in Saudi Arabia, which rose above 10% in April 2008 for the first time since the oil boom of the 1970s, will probably advance further this quarter albeit at a slower pace. It added that projections indicate a continued rise in the inflation rate during the second quarter of 2008, but at a slower pace than in the previous periods.

SAMA said that government and private spending will spur price rises in the April to June 2008 period, though suppliers of goods and services are responding more to rising demand. It added that "The pace of government and private spending is increasing, which would strengthen the demand for all goods and services which may lead to more inflationary pressures in the economy."

The report said that "The Saudi economy is an open market economy therefore, the change in the prices of imported goods is an important factor affecting the level of domestic inflation." It added that subsidies targeted to help lower income Saudis, state employee cost of living allowances and lower import levies on various food items are among measures Saudi Arabia has introduced to tackle inflation this year.

Steel prices in Egypt have been steadily increasing

Al Ezz Dekheila Steel, a subsidiary of Egypt’s dominant Al Ezz Steel Rebars, reiterated its ex factory price for a tonne of steel this week and set formal limits for the prices dealers and retailers can charge, in keeping with a new set of rules advanced by the ministry of trade & industry this week.

Al Ezz reported its ex factory price at EGP 5,700 per tonne, in keeping with figures released earlier this month, and set price caps at EGP 5,890 for distributors and EGP 5,990 per tonne for retailers.

Mr George Matta marketing director at Al Ezz Steel said that he expected resellers to respond quickly. He added that "The regulations are very clear. Those who do not comply will be reported to the ministry."

Mr Matta said that the margins garnered by retailers and, in particular, wholesalers were becoming really excessive. He said the sector has grown up by 25% faster than over the same period last year, and that concerns of higher prices were encouraging hoarding, which flung costs into an upward spiral. He added that "The people who were really raising the price were reacting to supply and demand dynamics. But we have to put a cap on these prices."

(Sourced from Daily Star Egypt)

Heads of OPEC and IEA to discuss oil price issues

It is reported that Mr Abdalla Salem El Badri secretary general of OPEC and Mr Nobuo Tanaka executive director of International Energy Agency will meet in July 2008 to discuss important issues currently facing the oil sector such as the surging oil prices, demand, supply and the future of the oil industry.

The meeting is scheduled to hold at the OPEC-IEA Luncheon. The OPEC-IEA Luncheon, which will take place on July 2nd 2008, is one of the most popular networking events of the World Petroleum Congress.

The speakers will debate the important issues affecting the industry today, including oil prices, demand, supply and resources, as well as the future of a sector so crucial for our global economy. Dr Noe van Hulst newly appointed secretary general to the International Energy Forum, will moderate the discussion.

During the 4 day Congress, 540 speakers will participate in an extensive program including 7 plenary sessions, 15 ministerial sessions, 7 special sessions, 4 luncheons and numerous technical sessions. The program will be divided into 4 blocks namely upstream, downstream & petrochemicals, natural gas & renewable and managing the industry.

(Sourced from Leadershipnigeria.com)

Port of Salalah preparing for new port handling equipment

Khaleej Times reported that Oman's Salalah port is preparing for new port handling equipment, including 4 super post panamax gantry cranes for its 2 new 18 meter depth berths.

The new cranes will complement the current 17 and increase the port's capacity significantly. These cranes can operate the largest vessels in the world with their ability to reach containers stacked 23 across on deck. The investment will also include 4 mobile harbor cranes, 10 new spreaders that allow twin pick capability and 11 additional rubber tyred gantry cranes.

Mr Gary Lemke CEO of Port of Salalah said that "Since its inception Port of Salalah has always strived to be an industry leader in innovation and port development. To ensure continued success we must make necessary long-term investments. Our business growth makes it important for us to increase available capacity in order to maintain our consistently high quality service to our customers as our throughput continues to increase."

With the opening of the 5th deepwater berth in May 2007 and the recent completion of berth six, the port project that the annual throughput will increase by about a third on delivery of the new equipment.

Bangladeshi laborers banned from working in Bahrain

Gulf Daily News reported that Bangladeshis have been banned from working in Bahrain following the alleged brutal murder of a Bahraini national by a mechanic from Bangladesh.

As per report, Mr Sheikh Rashid bin Abdulla Al Khalifa Bahraini interior minister has ordered authorities to stop issuing work permits to Bangladeshis.

The accused was charged with premeditated murder for allegedly slitting the throat of Mr Mohammed Jassim Dossary with a hacksaw after a disagreement over payment for work on the victim’s car.

Following the murder, MP Mr Abdul Halim Murad demanded the deportation of more than 100,000 Bangladeshi laborers from Bahrain. He called on the government to put a timetable for the deportation of Bangladeshi laborers from Bahrain after their repeated involvement in murders and other crimes.

Meanwhile, Bangladesh Embassy head Mr Saif Al Islam said that the move had left him and his colleagues in shock and the embassy would appeal against it. He added that "For one person the government is punishing a whole nation, which is not acceptable to us. We will appeal to the government to reconsider this. We will ask them at least to delay implementing this restriction."

Mr Al Islam said that 106,000 Bangladeshis are currently working in various sectors across Bahrain.

Pakistan auto assemblers Q3 profits down by 40% YoY

The Post reported that all the major auto assemblers profits declined by 40% in January to March 2008 period, while the net profit of auto assemblers during January to March 2008 period stood at PKR 744 million as against PKR 1.3 billion in January to March 2007 period.

The four major auto assemblers in Pakistan, Indus motors, Pak Suzuki, Honda Atlas and Dewan Farooque, covering 65% of the total auto sector market capitalization and 99% of total cars and LCVs sales, have been selected to draw up the accumulative results of auto sector.

Net sales of the industry stood at PKR 27.3 billion in January to March 2008 period as against PKR 29.2 billion during January to March 2007 period.

In addition gross margin went down sharply by 6.3% amid increasing steel prices and 16% appreciation of yen against rupee, this negatively impacted industry's gross profits in the period, as cumulative gross profit saw a massive decline of 39% to land at PKR 1.7 billion.

Although volumetric sales and net sales for Honda declined by 21% and 19% respectively, the 24% resulted in positive gross margins of 7.8% in January to March 2008 period, the company has been able to reduce its selling, distribution and other operating expenses resulting in net margins of 2.1%.

The two leading auto assemblers Indus Motors and Pak Suzuki Motors along with Dewan Farooque showed lacklustre performance during January to March 2008 period. A part from Indus Motors, other two companies showed a declined in volumetric sales, moreover, the companies witnessed high cost of sales as the cumulative cost per unit went up to PKR 480,000 in January to March 2008 period as compared to the INR 418,000 during the same period last year.

GCC to sign FTA with EU by end of 2008 – Report

Mr Ahmad Abdullah Al Mahmood chairman of GCC said that it hopes to sign a long awaited free trade agreement with the European Union by the end of 2008.

Mr Abdullah Al Attiyah secretary general of GCC said that "According to what the experts told us, at the end of June 2008 I think they will find a solution and it will be signed by the end of 2008. I hope so. We would like to see this negotiation on the FTA concluded soon."

Ms Benita Ferrero Waldner external relations commissioner of EU said that the two sides had made very good progress and were now closer than ever to a conclusion. She added that "We have to work closer together to reach a conclusion."

Earlier this year Mr Al Attiyah expressed frustration at the length of time it had taken to negotiate the agreement, blaming endless conditions by the European bloc. He complained that while EU companies won very big contracts in the Gulf Cooperation Council countries, they could not export their products to European markets.

GCC spends USD 43 billion on various airport projects

MEED reported that, capitalizing on record oil generated surpluses and an ideal geographic location, GCC countries are investing USD 43 billion in various airport projects and expansion of existing facilities.

According to a latest study, across the Middle East, South Asia and Africa region, more than USD 68 billion is being invested in various airport projects in the Gulf, Jordan, Iraq, India, Sri Lanka and across the African continent.

Mr Khalifa Al Zaffin executive chairman of Dubai World Central said that heading the list of mega projects is the USD 10 billion new Dubai World Central Al Maktoum International Airport. The 6 runway airport is designed to become the largest airport in the world and handling 120 million passengers annually. This is followed by the development of Abu Dhabi International Airport