It is reported that steel consultancy major Research & Consulting Group AG has opened an office at Mumbai in India in the beginning of May 2008. With the opening of Mumbai office, it has set footprints in almost all developed as well as emerging markets with offices at Düsseldorf in Germany, Kiev in Ukraine and Joint ventures in Brazil, China and Dubai.
As per report, it has registered a firm in India and has deputed Mr. Robert Meyer VP Asia to head the operations. RCG is eying emerging steel market in India to leverage its expertise in steel marketing filed and is also planning to use this office as global research center.

Mr Joachim Schroeder CEO of RCG said that “Establishing an additional office in India is the next logical step in our company development and philosophy. RCG wants to be close to the clients and due to the globalization in the steel industry we have to be present in each of the major steel regions worldwide. We are very keen to contribute to India’s future steel industry development.”

Mr Schroeder added that “In addition, we will develop Mumbai office as one of RCG’s major research centers leveraging India’s strong outsourcing perspective.”

Switzerland based Research & Consulting Group is an internationally active consulting firm, specializing in the steel industry as it has acquired profound knowledge of global steel industry through its many years of experience. RCG's clients are internationally operating companies, which are actively facing the challenges of increasingly intensive competition through wide spreading globalization. RCG works out integrated solutions together with its customers tailored to their needs.

Indian government through the initiatives by Mr Ram Vilas Paswan union minister of steel has tried hard to control the surge in domestic steel prices in India by meeting all the steel makers and announcing major policy decisions in last few months. The details of meetings and outcome in brief are as under

1. February 14th 2008 - During the interaction with major steel makers an appeal was made to review their last round of rise in price and in response to the appeal steel producers like SAIL, TATA Steel and JSPL rolled back prices by INR 1000 per tonne for TMT, rounds and bars and INR 500 per tonne for other steel products.

2. March 3rd 2008 - Steel Minister held discussion with all major steel investors including ArcelorMittal, POSCO, TATA Steel, Essar, Ispat and also SAIL, RINL to explore the possibility of expediting the ongoing as well as envisaged steel projects.

3. April 2nd 2008 - Ministry of steel held discussions with major steel producers assess the situations arising out of the rising steel prices

4. April 3rd 2008 - Ministry of steel held discussions with secondary steel producers to assess the situations arising out of the rising steel prices

5. May 1st 2008 - Another round of discussion with iron ore producers was held jointly by secretary steel and secretary commerce.

6. May 7th 2008 - The CEOs of major steel producing companies, namely, Steel Authority of India Limited, Tata Steel, RINL, JSW, Essar Steel, Ispat Industries Ltd. and representative of Jindal Steel & Power Limited met the Hon’ble Prime Minister and shared the government’s concern regarding the inflationary situation in the country and in accordance with the Prime Minister’s advice to contain prices, decided to take some measures

As a result of these discussions, Indian steel makers agreed to following cuts

1. Rashtriya Ispat Nigam Limited and TATA Steel agreed to roll back the prices of long products by INR 2000 per tonne;

2. The steel producers agreed to cut back the price of galvanized corrugated sheets by INR 500 per tonne.

3. Those producers, who have increased the prices in April, reduced the prices of flat products by INR 4000 per tonne. In addition, prices of rebars and structural where no increase was affected in April and May was also be reduced by INR 2000 per tonne.

4. These reductions will be applicable for all steel that gets consumed in India either directly or after further processing.

5. The Steel Producers will hold these prices for the next three months.

The steel makers also agreed to the following
1. Steel producers agreed to exercise restraint on export of steel products
2. The major producers agreed on a transparent pricing system through regular updation on their website.
3. The major producers agreed to increase allocation of steel to small and medium enterprise through the SSICs and NSIC, by 20% from 049 million tonnes to 0.6 million tonnes for 2008-09.
4. In addition to existing rebate of INR 550 per tonne provided out of Steel Development Fund, INR 400 per tonne of steel delivered to the SMEs through SSICs or NSIC will be borne by the producers towards defraying the cost of transportation to SMEs. 5. The steel producers agreed to enter price contracts for deliveries to SMEs for at least three months and directly service even smaller quantities to SMEs.
6. Similarly, the secondary producers also agreed to pass on any reduction in duty and taxes announced by the government, to the customers. The secondary producers also agreed to cut the prices of bars and rods.
7. The iron ore producers agreed to consider the reduction in iron ore prices and later informed about a reduction of the spot price of iron ore by INR 200 to INR 300 effective from second weeks of April 2008.

Indian government also took various fiscal and other measures for stabilizing the steel prices like exempting pig iron, non alloy steel and steel making inputs like zinc, ferroalloys and coke from customs duty; withdrawing DEPB benefits on export of various categories of steel products and bringing back railway freight on iron ore from classification 180 to 170 for domestic steel producers. In May, the Government imposed 15% export duty on semi finished products and hot rolled coils or sheet, 10% export duty on cold rolled coils or sheets and pipes, tubes and 5% export duty on galvanized steel in coil or sheet form in order to further curtail rising prices and increase supply of steel in the domestic market.

There has been an up trend in the domestic steel prices since 2006-07 and the trend accentuated since January this year. In between January and April this year the price of pig iron went up by more than 70%, construction steel like TMT and wire rods went up by more than 36% and HR coils went up by more than 40%. Rise in raw material prices, strong demand in the international and domestic market and up trend in the global steel prices have been some of the reasons cited by the industry for increase in the steel prices in the domestic market. The mismatch in demand and supply is considered to be the main reason on the demand side for the rise in steel prices.

SNS reported that the anti POSCO brigade is all set to celebrate the third anniversary of their protest movement even as the administration and company are getting ready to expedite the project work.

It may be noted that on June 22nd 2005, a MoU was signed between Orissa government and POSCO. However, the project work is running behind schedule because of the protests. The protest is spearheaded by POSCO Pratirodh Sangram Samiti, which claims it had spoiled company’s proposed foundation stone laying function on April 1st 2008 by successfully organizing the samavesh at Balithuta. As the government and the company are reportedly planning to lay the foundation stone during the last week of June 2008, the outfit now exudes confidence that it would spoil the face saving measure this time too.

Sources said that PPSS has solicited cooperation from various organizations, political parties, social activists and environmentalists ensure success of the protest. Meanwhile, 12 members of Bhusan coal mining sangharsa samiti led by Mr Radhasyam Baurdhia visited Dhinika, Patana and Govindpur village and interacted with members of PPSS.

They have reportedly committed to send hundreds of supporters from neighboring states like Chhattisgarh, Jharkhand, Bihar and Madhya Pradesh to join this protest meeting and other programs for protesting POSCO steel project.

The members also attended the public meeting at Dhinika, Gobindpur and urged upon the villagers to be united in fighting POSCO’s moves. They expressed that Sangharsa Bahinis have not allowed Bhusan company to lift coal from the mines area at Jamkina of Orissa Chhatisgarh border. They praised PPSS activists for not allowing POSCO to start its project work at Dhinika.

BS reported that, in a conciliatory move towards educated locals who are agitating against TATA Steel's proposed 6 million tonne steel plant in Kalinga Nagar, the TATA group is setting up a business process outsourcing unit on the proposed site.

The rural BPO centre will be established by the TATA Business Support Services in partnership with TATA Steel Rural Development Society. To start with, it is expected to employ around 200 people.

Sources close to the development said that TATA has already recruited the first batch of the executives for the BPO unit, who are expected to undergo two months of training at ATA Business Support Services' headquarters in Hyderabad. ATA Business Support Services has developed a specialized training program in view the fact that most of the new recruits are not computer literate. It currently operates three rural BPO units that employ around 500 people in all.

The centre aims at handling the Orissa region front end and customer support works of group companies including TATA Teleservices and TATA Sky. The BPO unit will also provide services to other firms who have substantial operations in Orissa.

A TATA group executive in charge of human resources development said that "Opening the BPO unit in Kalinga Nagar will provide us access to many educated but unemployed youths in semi urban areas like Jajpur Road and Duburi which have a number of colleges and educational institutions in and around. The education level among the masses in these areas is comparatively high and the aspirations level of the local people is also very high. Although most youths in these areas are interested in higher end and computer related jobs, there was no opportunity in these places."

The group will initially run the BPO unit in the transit houses and rehabilitation set up established by the company in Kalinga Nagar, before moving into a dedicated building in next few months. The centre will start as a voice based BPO with focus on Bengali, Hindi and English languages other than Oriya.

BS reported that Belgaum will soon have a foundry cluster as the work on the Belgaum Foundry Cluster is nearing completion and is expected to be operational in August 2008. The project started three years ago at an investment of close to INR 25 crore.

The project once completed will benefit 135 foundries and over 1,000 machine shops in and around Belgaum and hundreds of other units in the neighboring towns of Hubli Dharwad, Shimoga, Harihar and even Kolhapur and Shinoli in Maharashtra.

Mr Manoj Kulkarni CEO of Belgaum Foundry Cluster said that foundry units at BFC are expected to produce 160,000 tonnes of castings during the present fiscal, a growth of 60% over 2007-08 and generate a combined revenue in excess of INR 700 crore per annum, a growth of 75%. The exports are expected to touch INR 350 crore per annum, a growth of 700%. It is likely to generate employment to 12,000 persons.

Mr Kulkarni said that the cluster will also have modern software for 3D modeling, simulation and ERP for foundries will be made available to foundries. The foundry cluster will not only help improve the quality standards of material produced here but also protect ecological balance and conserve natural resources apart from growing exports. He added that "Our vision is to make Belgaum Foundry industry a global sourcing hub for castings and machined components by the year 2010. Despite slowdown in manufacturing sector and rising prices of steel and metal scrap we anticipate foundry units will register a healthy growth of 15% to 20% during the current financial year."

Foundry units in and around Belgaum are serving the automobile industry, general engineering and agriculture sectors. Automobile majors like Mahindra & Mahindra, Bajaj Auto, Ashok Leyland, TAFE, Caterpillar and engineering companies like Kiroskar Oil Engines Limited, Alfa Laval and Simpsons are some of the companies sourcing castings from Belgaum. The Belgaum foundries also export to countries like the US, Germany, Belgium and West Asia.

It is reported that, with input costs shooting up and a fuel price hike in the horizon, Indian carmakers have a tough task on hand luring in customers. While April 2008 was a relatively good month for carmakers in terms of sales, they are seeing a sharp fall in numbers in May 2008.

The biggest dent is in the small car segment, which accounts for 75% of the total sales. Carmakers blame the recent car price hike, high interest rates and the rising input costs of steel, aluminum and plastics. They said that the imminent fuel price hike will only add to their woes.

Mr Dilip Chenoy director general at Society of Indian Automobiles said that "It is bad times as fuel prices affect both automakers and auto consumers."

Carmakers are reluctant to offer heavy discounts to accelerate sagging sales as input costs have already put a lot of pressure on margins. Instead, some of them are thinking of bringing in cars, which use alternative fuels like CNBC and LPG.

Mr HS Lheem president of Hyundai Motor India said that "There is pressure. We are getting into LPG and CNG to combat this"

Even luxury car makers are feeling the pinch. Automakers for now have chosen to wait and watch and postponed new launches for the coming months.

Ranchi Express reported that Steel Authority of India’s Bokaro Steel Plant team has won the zonal award for business management simulation contest, organized by All India Management Association. The BSL team outshone representatives of 29 reputed companies to bag the western zone winner award.

BSL had sent 4 teams as representatives at different zonal level competitions. The team including Mr C Srikanta deputy GM, Mr A Prakash and Mr Alok Verma senior managers and Mr S Sengupta deputy manager, emerged as the winner.
The wining team met senior executives of BSL including Mr V K Srivastava MD and executive directors Mr Jeevesh Mishra and Mr KSR Marti. Mr Srivastava wished the team good luck for future competitions at New Delhi on June 14th 2008.

The top two teams of the will get an opportunity to represent India in the As an Management Games 2008, The best team of the AMG would go on to contest in the Global Management Challenge 2008.

Exim News Service reported that ABG Infralogistics has outbidded TM International Logistics in partnership with Ripley & Co, Sical Logistics and Orissa Stevedores for securing the operation, handling and maintenance contracts for two berths at the Haldia dock. However, Kolkata Port Trust is yet to formally approve the selection of the company.

Once approved and the contract awarded, the actual operation is expected to begin within another 6 months. This is because substantial investments, running into a couple of hundred crore of rupees, might be needed on the acquisition and deployment of equipment 6 mobile harbor cranes, 50 pay loaders and 30 dumpers.

The Number 2 berth of the Haldia dock is newly built, commissioned a few months ago, while the Number 8 is an old berth. At both the berths, ABG Infralogistics will handle mainly coking coal import for Steel Authority of India and TATA Steel. The plan also includes launching trans loading operation at Kanika Sands, an uninhabited island off Orissa coast.

SAIL, which imported 4.6 million tonnes of coking coal through Haldia in 2007-08, has indicated to step up the throughput to 6 million tonnes in the current fiscal. For SAIL, Haldia is the most suitable port from rail transportation point of view for 4 of its plants located at Durgapur, Bokaro, Rourkela and Burnpur.

Depending on the success of negotiation with SAIL, ABG Infralogistics will approach the Orissa government for necessary clearance. Kanika Sands being off the Orissa coast, the Orissa government has made it clear that no operation could be undertaken in the island without its prior approval.

VNS reported that TATA Steel has entered into strategic partnership with Vietnam Steel to develop the iron and steel industry.

Mr Indronil Sengupta CEO of TATA Steel Southeast Asia projects during an interview with VNS said that "After more than 100 years of making steel and mining, four years ago, as part of its globalization strategy, TATA Steel began focusing on Southeast Asia. Today we are the most significant player in the region, with around 4 million tonnes per annum and manufacturing units in Singapore, Viet Nam, Malaysia, Thailand and the Philippines."

He added that "We are setting Viet Nam as our first priority in our investment strategy and will be investing in a large steel plant and iron ore mine. Viet Nam is now one of the fastest growing markets in Southeast Asia, with GDP growth estimated at about 8%."

He said "We consider Viet Nam the most significant market for TATA at the moment, particularly in the production of steel. TATA Steel has just entered the Viet Nam steel market with an investment project for constructing and operating one of the largest steel complexes in Viet Nam, in partnership with Viet Nam Steel Corporation. This steel complex will be located in Ha Tinh Province with an estimated capacity of 4.5 million tonnes per annum."

Mr Sengupta further added that "As one of the few steel companies that also mine iron ore, TATA Steel will participate in Thach Khe Iron Ore Joint Stock Company, through which we expect to contribute our mining experience. These are just TATA Steel’s very first steps into Viet Nam’s emerging market."

The New Nation reported that Bangladesh Steel Re Rolling Mills Ltd has launched Grade 500W rebars, helping make constructions stronger, safer, more durable and also more cost effective in Bangladesh.

Using premium European technology, BSRM has set up a 375,000 tonnes per annum state of the art steel rolling mill to cater Bangladesh's demand for high strength steel. These rods have a yield-strength of over 500 MPa, which is 20.8% stronger than Grade 60 steel.

Bangladesh Steel Re-Rolling Mills Ltd, a unit of well known H. AKBERALI Group of Industries, having 55 years experience exclusively in steel making, is fully automatic steel re rolling mill in the country. The founder of the group was late Mr Akberali A Africawala and is now managed by his son Mr Ali Hussain Akberali and other sons & nephews.

Everest Kanto Cylinder Limited recently announced its audited financial results for the year ended March 31st 2008.

As per the audited results, the total sales revenue for the year was recorded at INR 528.74 crore up by 24.4% YoY and profit after tax was at INR 104.27 crore up by 45% YoY.

The said profit after tax is after providing for foreign exchange derivative loss of INR 8.22 crore which occurred due to the fall in the US Dollar vis a vis other major currencies. It is also after a past year's one time tax adjustment of INR 3.32 crore.

National Thermal Power Corporation Limited has announced results for the January to March 2008 quarter. The sale of energy for the quarter is up by 21.39% YoY.

NTPC has declared audited net sales of INR 37,050 crore during 2007-08 up by 13.67% YoY as against INR 32,595 crore. The gross revenue crosses INR 40,000 crore during 2007-08 up by 13.11% YoY.

Profit after tax for the year 2007-08 is INR 7,415 crore up by 8.01% YoY as compared to INR 6,865 crore during the year 2006-07. Adjusted audited profit after tax is INR 7,569 crore up by 15.35% YoY as against INR 6,562 cores for 2006-07.

BL reported that the detailed project report for Gujarat Industries Power Company's 500 MW lignite based power plant at Nani Naroli in Surat district is under examination and the environmental report will be ready by early June 2008.

The project will entail an investment of INR 3,000 crore. Work on the project is likely to commence by September 2008 and will be operational by 2012.

BL reported that Maharashtra government is re evaluating bids given by consortium led by Reliance Energy and Sky Infrastructure for the development of the Sewri Nhava sea link project, also called as JRD TATA Bridge.

As per report, the consortium led by Reliance Energy had quoted a concessional period of almost ten years, while Sky Infrastructure has sought a concession period of 75 years before the bridge is handed over to the government. After a pitched legal battle REL, which was initially not allowed to participate in technical bidding for the project, was allowed to submit their proposal. After the financial bidding, the project was awarded to the REL.

The sea link project to link Nhava in Raigad district will be built at an estimated cost of INR 5,000 crore and the private builder can recover costs through toll collected during the concessional period.

BS reported that Jammu & Kashmir government will sign a MoU with GAIL India Limited for setting up of a city gas distribution network in the 8 districts of the state.

A source in Consumer Affairs & Public Distribution department said that "GAIL has submitted the revised and the final draft MoU, in connection with the project, to the state. The state law department studied the proposal and suggested minor modifications in it."

This new project will help in promoting usage of natural gas its fractions and polymer products. Subsequently, the state plans to introduce compressed natural gas for automobile use. Two capital cities of Jammu and Srinagar besides Kathua, Udhampur and Anantnag will be the immediate beneficiaries of this project.

The sources said that GAIL experts have already conducted a techno economic feasibility study based on the gas demand, potential and geographical conditions, distribution of gas and allied facilities in the state. SIDCO would act only as a nodal agency for facilitating and coordinating the activities of GAIL India Limited during the course of implementation of the project.

Mr Naresh Nayyar MD of Essar Oil Limited said that it is planning to increase capacity to 1 million barrels a day and expects to tie up a USD 4.5 billion loan for the expansion in the next few weeks. He added that domestic refining capacity will be increased to 750,000 barrels a day by 2010 from 250,000 barrels and the rest will be added overseas in 3 to 4 years.

Essar Oil aims to narrow the gap with Reliance Industries Limited, which is using record profits to build the world’s biggest refinery complex. Essar’s Jamnagar refinery started last year, almost a decade after it was first planned, as the group’s steel unit faced losses because of falling prices of the commodity.

Reliance has built a plant in the same city that’s 3 times larger than Essar’s and will almost double capacity again with a new facility. Reliance Petroleum Limited, a unit of Reliance Industries, is building a 580,000 barrel a day refinery adjacent to the 660,000 barrel a day plant owned by its parent.

Mr Nayyar said that Essar will sell as much as 60% of fuel from its refineries in India after adding capacity. He added that "Indian fuel demand is rising and we hope the government will change its pricing policies."

Essar currently sells 65% of fuel to state run refiners including Indian Oil Corporation. It had to shut more than 90% of its 1,250 fuel stations because it could not match the prices charged by state run refiners. It plans to invest USD 290 million on exploration.

Exim News Service reported that Indian government has agreed to support the Coastal Corridor project covering the districts of Srikakulam, Vizianagaram, Visakhapatnam and East Godavari district of Andhra Pradesh.

The state government will now look to develop a 4 or 6 lane road parallel to the existing national highway to support the port based industries.

According to the initial plan, the Andhra Pradesh government is looking at developing the 30 kilometers long road from Visakhapatnam to Gangavaram Port. The total distance that has been identified is 138 kilometers, but the state government have been asked implement it in a phased manner.

The total cost of the project, is yet to be finalized, but is estimated to be around INR 5,500 crore and in the first phase, around INR 1,100 crore has to be invested.

PTC India has announced that it planned to raise USD 500 million to meet its growing requirements.

Mr Tantra Narayan Thakur CMD of PTC India said that "The requirements are huge. But we also have to look at the market appetite. Any fund worthwhile should not be less than USD 300 million. But initially, we would go for USD 500 million and later raise it further."

Mr Tantra added that it is in talk wit h investors to understand market requirements, while declining to give any time frame.

BS reported that Videocon Group is planning to set up a 1,000 MW hydroelectric power project in Uttarakhand with an investment of INR 6,000 crore.

It plans to rope in a US partner for the proposed project.

Exim News Service reported that AFCONS, the marine infrastructure wing of the Mumbai-based infrastructure major Shapoorji Pallonji, has received the letter of intent from the Gujarat Maritime Board to develop the Simar Greenfield port in the state. This marks Shapoorji Pallonji's foray into port operations and bulk cargo handling.

AFCONS had made its name as a specialist in providing infrastructure for ports, having constructed more than 150 marine structures throughout India. It will reportedly be investing INR 800 crore to develop and handle cargo at Simar.

The first phase of the project is proposed to be completed by 2012 and the second phase by 2020 with handling capacity of 10 million tonnes. A detailed study of the project will be initiated soon, with work set to begin immediately after obtaining the remaining clearances, including those related to the environment.

Simar is planned as an all weather direct berthing port with a 300 meters long jetty and offshore breakwater of 700 meters.

Hindustan Petroleum Corporation Limited has posted a profit of INR 384.5 crore in the January to March 2008 quarter down by 30% YoY as against INR 549.5 crore in January to March 2007 quarter.

Like its larger rival Indian Oil Corporation, HPCL also said that it would be forced to curtail product supplies to domestic market if a relief package to plug the company's ballooning oil subsidy bill was not finalized soon.

Mr Arun Balakrishnan CMD of HPCL said that "If there is no relief, we will have to restrict sales. Imports are finalized up to June 2008. For July, August and beyond, we will decide what to do next week."

HPCL saw a sharp increase in its interest costs during the year to INR 792 crore as against INR 423 crore in 2006-07 fiscal. It has also been forced to defer its major CAPEX plans such as expansion of Vizag refinery, which would have long term implications for the company.

HPCL announced a dividend of 30% involving a total payout of INR 118.86 crore including dividend tax.

The Telegraph reported that the construction of the proposed all weather port in coastal Balasore is likely to begin within 3 months. Chennai based Creative Port Development Private Limited would set up the INR 2187 crore deep water, mechanized port at Kirtania on the Subernarekha mouth in Balasore.

The first phase of the port with a handling capacity of 10 million tonnes per annum is expected to be commissioned by 2010 and ultimately its capacity would go up to 50 million tonnes per annum by the 10th year.

The port will not only handle Orissa cargo, but will also provide services to hinterland states. The port holds huge promise for neighboring landlocked states like Jharkhand, Chhattisgarh, Bihar, Bengal and the Northeast.

A senior officer of the commerce department said that the Chennai authority had submitted a detailed project report to the government and the construction would start soon after the land is handed over. The land acquisition process is in the advanced stages and is expected to be over within the next 3 months. But land acquisition for the 36 kilometer long Rupsa to Kirtania rail link is likely to take time.

Creative Port Development Private Limited signed a concession deal with the state on January 11th 2008, enabling the latter to share revenue at the rate of 5% from the first to fifth year, 8% from sixth to tenth year, 10% from the 11th to 15th year and 12% for the remaining 15. It would enjoy the concession for a period of 30 years, extendable by an additional period of 20 years.

In the first phase, Creative Port Development plans to build 4 berths and then add more till the capacity reaches 50 million tonnes per annum by the 10th year. The port would be developed on build, own, operate, share and transfer basis for 34 years and would include a dedicated rail cum road connection from NH 5 and a rail network at Jaleswar.

Meanwhile, Andhra Pradesh based Navyug Engineering Limited has evinced its interest in building a port at Astarang in Puri at an estimated cost of INR 6,000 crore. The proposed port is expected to be built in 3 phases with 2 coal berths, an iron and steel berth and another multi cargo berth. After the commissioning of the phase I, the port will have a cargo handling capacity ranging between 12.75 million tonnes and 23.25 million tonnes per annum. The final capacity would be around 47 million tonnes per annum.

ET reported that Larsen & Toubro is looking at possibilities of forming JV companies with Indian Railways to manufacture equipment for the railways.

Mr JP Nayak board member & president operations at L&T said that "Indian Railways has 2 locomotive manufacturing units the Chittaranjan Locomotive Works and the Diesel Locomotive Works. There is a possibility of putting up another loco manufacturing unit in India and we will be interested in setting up a JV with the government."

Mr Nayak further said that Indian Railways has decided to set up new manufacturing capabilities through the public private partnership route and L&T is interested in floating a JV with them.

Meanwhile, L&T has decided to invest INR 25 billion during the current financial year to augment capacities at its growth centers. The money will be spent in augmenting facilities at all locations and for setting up a ship building yard in Tamil Nadu.

It is reported that Uttarakhand tourism department is planning to invite private players to set up a cable car between the hill resort of Mussoorie and Dehradun with an investment of INR 700 crore.

Uttarakhand Infrastructure Projects Company, a JV between the state government and IL&FS, has been asked to prepare the DPR for the cable project.

The proposed cable car will start from Purkul village at the foothills of Mussoorie where a five star hotel and an amusement park are also being proposed.

BL reported that, having successfully completed exploratory drilling, Essar Exploration & Production Limited has begun developing the Raniganj East coal bed methane block in West Bengal for commercial production of gas. The block is expected to start production in end 2008-09.

A senior company official said that "We have spudded the first production well at Raniganj on May 30th 2008. In the first phase, we will drill 15 production wells in the 500 square kilometer block in 6 months. Gas is expected to start flowing by the end of this year."

Essar E&P owns 100% interest in the block and has roped in Grades Energy of the US as the drilling technology partner. While a realistic production potential of the block can be made only at a later date, early estimates suggest the block has 42 billion cubic meters gas reserve.

Essar controlled Raniganj East will be the second CBM producing field in gas starved West Bengal. Great Eastern Energy Corporation Limited has already earned the distinction of producing India’s first commercial CBM from the adjacent Raniganj block in 2007.

Maharashtra State Road Development Corporation has announced plans to construct 17 aesthetically structured skywalks at high pedestrian density areas around railway stations by June 2009. The skywalks, along with a subway at Chhatrapati Shivaji Terminus, will be constructed in 2 phases and are expected to cost around INR 125 crore.

Mr Anil Deshmukh minister for public works department said that "We did a pre feasibility study comparing skywalks and subways and we found that skywalks are better. They are economical, will have aesthetic value and are easy to construct. Moreover, they are weather protected unlike the existing foot over bridges."

Nine locations have been identified by the MSRDC for the construction of skywalks in the first phase of the project. The consultancy for phase one has already been awarded while the notice for appointment of consultant for the second phase has been issued.

In the phase I, skywalks will be constructed at Nallasopara, Vasai Road, Ambernath, Goregaon, Kandivali, Vile Parle, Masjid stations and CST to Churchgate. The skywalks will have a height of 5.5 meters and the piers and super structure will be made of steel, with poly carbonate roofing. They will have elevators, toilets and exits.

Mr Deshmukh said that "The project is being funded by the MMRDA. The skywalks when completed will be run on BOT basis. There will be security guards and we will not allow ferrywalas. Some shops will be constructed on skywalks with adequate width."

BS reported that Essar Oil Limited has bid for an offshore block in Australia and is in talks with foreign companies to explore for oil in Egypt and Yemen in a bid to expand sources of crude for its refinery. It is also looking at exploration blocks in Kurdistan in Iraq.

Mr Naresh Nayyar MD & CEO of Essar Oil Limited said that "We plan to take our refining capacity from 210,000 barrels of oil per day to 1 million barrels of oil per day in the next 3 years. With the expansion at Vadinar, our capacity will go up to 700,000 barrels of oil per day. The rest we plan to achieve through acquisition of assets overseas."

The current capacity of Essar's Vadinar refinery is 10.5 million tonnes per annum, which it plans to increase to 34 million tonnes per annum in the next 3 years. It started commercial production from the refinery at Vadinar, Gujarat in May 2008. It will raise a fresh debt of up to USD 5 billion to fund its USD 6 billion refinery capacity expansion program at Vadinar.

Mr Nayyar said that "We plan to raise a fresh debt of up to USD 5 billion to fund the expansion. The funds would be raised through external commercial borrowing and rupee loans." He added that promoters would contribute USD 2 billion in two phases. It has already received in principle commitment from lenders for up to USD 4.3 billion.

Essar Oil is also partnering an American company to bid in the seventh round of the New Exploration and Licensing Policy scheduled on June 30th 2008.

Essar oil is also in talks with Cairn India to buy crude. Cairn will start production from its oil field in Rajasthan in the second half of 2009. At present, Essar sources crude from West Asia and Venezuela and currently sells 65 per cent of its production in India. Post expansion, the ratio would be around 60:40.

BL reported that the Indian government has withdrawn duty drawback benefits on all iron & steel, cement and rice shipments. Henceforth, exporters of these commodities will not be entitled to any rebate or refund of customs, excise or service tax paid on inputs used for their production.

In a notification dated May 29th 2008, the revenue department has said that no amount or rate of drawback shall be determined in respect of any goods falling within Chapter 72 or heading 1006 or 2523 of the First Schedule to the Customs Tariff Act, 1975. Chapter 72 covers all iron & steel products, while headings 1006 and 2523 relate to rice (including basmati) and cement, respectively.

The finance ministry specifies drawback rates for individual export items after factoring in broad parameters including standard input output norms pertaining to its manufacture, the share of imported vis a vis domestically sourced inputs and the prevailing rates of customs, excise and service tax on the inputs.

This move comes in the backdrop of a weakening rupee, which has made exports more remunerative. With the headline inflation rate crossing eight per cent, the Centre is keen to augment domestic availability of sensitive items and, therefore, discourage exports to the maximum.

Based on preliminary Census Bureau data, the American Iron and Steel Institute reported that the US imported a total of 2.944 million net tons of steel in April 2008, including 2.194 million net ton of finished steel up by 15% MoM and 4% MoM respectively/

Total and finished steel imports through the first four months of 2008 are down 7% and 9% respectively vs the same period in 2007. However, the monthly average for finished steel imports in the most the February to April 2008 period is up 8% as compared to monthly average in the previous November 2007 to January 2008. Total and finished steel imports on an annualized basis are down 4 and 5 percent, respectively, vs. 2007. On an annualized basis, total imports of steel in 2008 would be 32 million net ton.

Key products with large increases in April compared to the month before include:
1. Ingots and Billets and Slabs up by 64%
2. Hot Rolled Sheets up by 40%
3. Reinforcing Bar up by 30%
4. Wire Rods up by 92%
5. Plates in Coil up by 33%
6. Cold Finished Bar up by 32%

For the first four months of 2008, products showing increases vs. the same period in 2007 were
1. Line Pipe up by 26%
2. Oil Country Goods up by 18%
3. Heavy Structural Shapes up by 10%

Mr Dave Phelps president of AIIS said that imports increased in April to 2.943 million tons up 14.5% from March. While one month a trend does not make, this welcome positive development for April will bring some relief to domestic consumers, who have been struggling with low inventories and rapid fire price increases in 2008.”

He added that “Import arrivals in late 2007 and early 2008 were clearly too low for our cur customers given the inability of the domestic industry to meet total demand. The largest increases in April in finished products were hot rolled sheet and wire rods, both products that have been in tight supply in 2008. The large increase in slabs will likewise increase finished product deliveries for the domestic mills, adding needed steel to the marketplace.”

Mr Phelps concluded that “We hope that this trend will be sustained as we go deeper into the second quarter.”

Honda Motor Co's chief executive said that the Japanese automaker had been asked to pay more by a US steelmaker despite a contract agreed earlier this year and added he feared other suppliers may follow suit.

Mr Takeo Fukui said that Honda sets product prices with US steelmakers at the start of every year, but one undisclosed supplier recently imposed higher prices. He said that "It came all of a sudden, ignoring the contract.”

He added that "I am hearing that so far it is one company, but it may spread to others. It's an abnormal situation adding that Honda was probably not the only buyer targeted.”

Mr Fukui said that the price increase from US makers tended to be non negotiable. He said that "If we refuse, they cut off supply. We're in a weak position.”

Honda has just begun talks with domestic steelmakers after industry leader Toyota Motor Corp concluded negotiations with top supplier Nippon Steel Corp, likely agreeing on a price rise of more than 30%.

The five main reasons for rising global steel price are

1. Demand
World steel demand continues to grow, notably from newly industrialized countries and this has put steel mills and their raw materials suppliers under pressure. While Chinese demand has abated slightly, it is still nearly double the global average.

2. Raw material costs
Constantly increasing demand puts pressure on steelmaking raw materials. Since 2004, iron ore prices have increased by nearly 300%, while coking coal prices remain at historically high levels.

3. Shipping costs
Driven by a shortage of vessels, shipping costs have escalated. By December last year, one-time charter rates were 250% higher than the 2006 average.

4. Energy costs
Like the rest of UK manufacturing, the steel industry has been experiencing high energy prices. Forward prices for both gas and electricity are showing high increases, with the UK electricity prices outstripping those on the continent.

5. Legislation
The extension of the EU's Emissions Trading Scheme may extend to even more steel companies and more installations. Environmental costs imposed will be passed down the supply chain.

Journalsentinel.com reported that a Janesville manufacturing plant is closing, resulting in the loss of about 140 jobs, as its German owners consolidate operations.

The ThyssenKrupp plant makes parts and production equipment used in automotive factories. Combined, the operations employ 175 people, including mechanical and electrical engineers, robotic engineers and administrative personnel.

Mr Matt Rhodes a company spokesman said that work at the plant will be phased out by September 30t 2008. Thirty four of the employees will be offered jobs with ThyssenKrupp Krause Inc and ThyssenKrupp Drauz Nothelfer in the Janesville area and Auburn Hills in Michigan near Detroit. The spokesman added that the remaining employees will lose their jobs and the plant will be sold.

Thyssenkrupp said that it is closing the Janesville operation, formerly known as Gilman Engineering, for competitive and cost reasons.

Purchasing magazine reported that US Steel’s sheet prices rose by 20% in May 2008 surpassing April's record, after producers took advantage of lower imports and inventories to pass on higher raw material costs.

The magazine said that hot rolled steel sheet, the benchmark product used in cars and appliances, climbed to an average USD 1,020 a ton in May from USD 850 in April. Prices have gained 76% since January and are about 86% higher than a year ago.

The Metal Service Center Institute in a May 16th 2008 statement said that higher costs for iron ore and energy have raised the costs of making and transporting steel. A shortage of the metal in the US partly because of lower imports, has allowed producers to increase prices. Inventories at US service centers were 15% lower at the end of April than a year earlier.

Mr Tom Stundza executive editor of Purchasing in the report said that “Every time this year that steel buyers open the doors at receiving docks to receive new supplies, prices have been higher.”

According to the American Iron and Steel Institute, The US imports steel because domestic producers make about 30 million tons less than the 130 million tons the nation uses annually. Steel imports through the first four months of 2008 fell 9.5% to 8.4 million tons from a year earlier.

DutchNews reported that the province of Noord Holland must re examine the pollution restrictions imposed on the Corus steel works in IJmuiden in 2007.

The Council of State said some pollution levels had been set too low and no emission limits at all were set for a number of heavy metals such as chromium.

In addition, the province has been told to research the effect of burning waste material at the plant and using special filters on heavy metal concentrations. Noord Holland has been given five months to get the paperwork in order.

It said that a number of environmental organizations and local councils had appealed against the new operating license when it was granted in 2007.

The ruling comes just weeks after a Zembla program claimed children living close to Corus had up to 14 times higher levels of chromium and other metals in their system than normal. The environment ministry has set up an inquiry into the claims.

Corus in a statement said that it was studying the Council's ruling in detail.

VIA Rail Canada announced the purchase of new steel rails from Canadian Rail Track Materials to replace existing rails. The new rails will cover a critical portion of the tracks near Alexandria, Ontario, between Ottawa and Montreal and should be installed within the next few months.

Mr Paul Côté president & CEO of VIA Rail said that "The upgrade will provide better quality tracks, which should translate into a smoother ride and faster trip times for travelers on this route.”

Mr Cote added that "In addition, we are selling the existing rails, effectively lowering VIA's net cost and ensuring that the steel is reused.”

Mr Lawrence Cannon minister of transport, infrastructure and Communities of Canada said that "Funding improvements to the national transportation system are a priority for our Government. This project represents an excellent return on investment for the Government of Canada, VIA Rail and especially for passengers."

The contract, valued at close to CAD 3 million is part of the Government of Canada's five year, CAD 692 million capital investment plan announced last fall and is the result of a public tendering process.

Thomson Financial reported that Greek metal holding company Viohalco SA first quarter group net profits dropped by 54.3% to EUR 17 million on higher financials, interest expenses and a higher effective tax rate, as well as lower contributions from subsidiaries.

Viohalco’s first quarter EBITDA decreased by 32.8% to EUR 85.8 million due to sharp increase in steel scrap, copper and aluminum prices, as well as higher energy and transportation costs.

Group sales for the first quarter fell by 4.3% to EUR 917.1 million due to lower volumes from the slowing residential sector in Greece, and unfavorable commodities environment, lower product price increases and a depreciating US dollar.

Recycling Today Magazine reported that the Dallas City Council has voted unanimously on a measure that will tighten the restrictions on scrap metal recyclers in the city. The City Council approved the measure on May 28.

The measure, which will go into effect June 3rd 2008, initially had a host of stipulations, including the following:
1. Requiring increased record keeping for scrap metal dealers
2. Requiring photographs and fingerprints of the seller
3. Requiring the metal to be delivered in a motor vehicle to a recyclers’ place of business
4. Requiring a five day hold on purchased metal
5. Requiring proof of ownership or authority to sell catalytic converters
6. Making changes to conform to state law.

While the measure passed, local press reports note that one stipulation requiring recyclers pay the seller by check, rather than cash is still to be debated.

The report added that the ordinance punishes violators with a fine of up to USD 500. Aluminum food or beverage containers are generally exempt from the ordinance.

Reuters reported that German wind turbine maker Nordex has earmarked USD 100 million to set up a production site in the United States in the years ahead to meet rising demand from the region. The first US assembled turbines are expected to hit the market next year.

Mr Thomas Richterich CEO of Nordex said that "We expect Europe, Asia and the United States to each account for one third of demand. Over the next few years, we want to generate around 20 percent of our sales in North America.”

He added that in a first step, Nordex plans to set up a wind turbine assembly site with an annual production capacity of 750 MW by 2012, but has not yet chosen a location. In a second move, Nordex plans to establish its own rotor blade production facility as of 2010, for which it set aside two thirds of the USD 100 million investment sum.

Mr Ralf Sigrist president of Nordex USA Inc said that "We are looking for a centrally located facility, with everything pointing to a location in the Midwest.”

It is reported that MSI General Corp has been selected to design and build a 160,000 square foot plant in the Menomonee Valley for Charter Wire, which is moving from the 3rd Ward.

The Oconomowoc general contractor said that it will build the estimated USD 20 million plant between Wheelhouse Road and Milwaukee Road and the construction is planned to start in August 2008, with a move in date slated for late 2009.

Charter Wire is a division of Charter Manufacturing of Mequon. It is a major supplier of shaped steel wire and bar products for industries.

Reuters reported that the European Commission has welcomed proposals by RWE to sell off its gas transport network to settle an ongoing antitrust case.

The Commission said that "The European Commission welcomes structural remedies offered by the German energy company RWE.”

The Commission said that it would send the proposals to customers and competitors for their review. The Commission hoped to approve a binding settlement and then would not pursue the antitrust investigation."

Thomson Financial reported that Altri net profit fell by 48% to EUR 5.6 million in the first quarter from EUR 10.6 million in the first quarter of 2007 pressured by rises in raw materials costs.

Altril’s first quarter revenue edged up by 2% to EUR 108.58 million from EUR 105.95 million a year earlier. EBITDA decreased by 15% to EUR 24 million from EUR 28.32 million in the end of the first quarter of 2007. It added that first quarter CAPEX came in at EUR 54.4 million most of which was invested in the pulp sector.

Altril in a statement said that its industrial activity is influenced by raw material cost price evolution and this influence was particularly noticed in 2007'.

ArcelorMittal has confirmed that that an accident occurred this morning at its Tentekskaya Mine in Kazakhstan.

It said that “100 people were working in the mine when the accident occurred at approximately 4AM Kazakhstan time this morning. And 95 were safely evacuated. At present 5 people are still missing.”

The release said that “Although rescue services are on site and every effort is being made to locate those missing, it is believed that tragically they have died as a result of the accident.”

The release added that “Senior members of ArcelorMittal management are currently present at the mine. A full investigation will be launched into the cause of the accident. However at present the company believes that there was no explosion, as has been reported early today. Further information will be announced as it becomes available.”

Mr Frank Pannier CEO of ArcelorMittal Kazakhstan said that “I deeply regret that there has been an accident in one of our mines in Kazakhstan. Fortunately the evacuation procedure worked well and we have managed to bring 95 people safely to the surface. Nevertheless it looks as though there have been 5 tragic fatalities as a result of the accident. At this moment I do not wish to speculate about the causes of this accident, but I must state that my absolutely priority as the new CEO here in Temirtau is to ensure the safety of our workers and ArcelorMittal will continue to invest heavily in the ongoing modernization of the mines.”

It is reported that Taiwan’s China Steel Corp has bought bonus scrap steel with the purchasing price of USD 788 per tonne CIF from Schnitzer Steel Industries Inc. The price of heavy melting scrap was USD 768 per ton CIF.

The price of bonus scrap was USD 10 per tonne higher than the price of heavy melting scrap, but this deal has USD 20 per tonne price differences. This reflects the excellent scrap steel shortage in American market.

It is reported that domestic sales by Korean carmakers are expected to increase nearly 7% in the H2 of 2008 despite unfavorable conditions such as sky high oil prices.

The Korea Automotive Research Institute predicted in a report said that total sales by industry leader Hyundai Motor Co and four other players are likely to climb 6.8% to 689,000 units in the July to December period.

The Institute said that the solid second half gain will be powered by the rollout of various new models and strong demand for new cars from motorists who own old vehicles.

According to the report, sales of mini cars and subcompact cars are likely to slow down in the second half, while those of intermediate cars are predicted to edge up. It said that sales of large cars are projected to remain robust, but their growth momentum will probably taper off.

The Institute said that the exports of domestically made cars are likely to reach 1.54 million units in the second half compared with 1.46 million units in the first six months of this year. Soaring international oil prices have been a drag on the domestic automakers as motorists are trying to tighten their belts.

According to a South Korean government report, a record surge in exports of ships in May helped South Korea post its first monthly trade surplus in six months.

The Ministry of Knowledge Economy said that exports rose 27.2% YoY to USD 39.49 billion last month, while imports jumped by 28.8% to USD 38.45 billion for a surplus of USD 1.04 billion. Last month marked the eighth consecutive month that exports grew by double digits, while the average daily export volume climbed 32.9% YoY to USD 1.76 billion.

It said last month's ship exports shot up 56% YoY to reach an unprecedented USD 4.90 billion. The ministry said that exports of a USD 1.3 billion floating production storage and offloading vessel to Nigeria and seven liquid natural gas carriers played a key role in bolstering exports. Each LNG carrier costs over USD 100 million. In the first five months of this year, ship exports hit USD 15.96 billion. In 2007, total ship exports reached USD 27.77 billion.

The provisional report also said exports of petroleum products rose 118% while those of mobile communication equipment, steel and general machinery all gained more than 20% from the same one-month period of the previous year.

The report added that exports to member states of the Association of Southeast Asian Nations and Central and South America jumped by 45.2% and 44.3% respectively. Shipments to China and Japan respectively climbed 32.6% and 17.4% while those to the United States were down 5.4%.

It is reported that transformer manufacturer Powertech Transformers has signed a seven year ZAR 1.37 billion contract with Eskom for the supply of transformers in a range of sizes.

Mr Eskom GM of procurement and supply chain management of Eskom said that it was critical for Eskom to look at long term relationships with its suppliers and that a further extension of three years could be added to the contract, depending on whether Powertech Transformers complied with its minimum requirements of constant improvement.

He added that Eskom would, on a quarterly basis look at whether Powertech Transformers was complying with the minimum key performance indicators of quality of supply and the continuous delivery of transformers.

Mr Leon Viljoen CEO of Powertech Transformers said that "We are fully committed to ensuring the successful execution of this contract and for me that means delivering high quality transformers on time every time.”

He added that the company was continuously upgrading its manufacturing facilities and was training its staff on a regular basis, which ensured that it was improving its abilities on a continuous basis.

Bloomberg reported that Samsung Heavy Industries Co, the world's second biggest shipbuilder, paced gains in South Korean shipyards in Seoul on expectations they will attract orders after an accident at a Chinese yard last week halted production.

Hudong Zhonghua Shipbuilding Co, a unit of China's biggest shipyard, said on May 30 that two 600 tonne cranes collapsed, killing three people and injuring two. The company hasn't given details on lost production time or costs. The cranes are used to move blocks or steel structures that make the hulls of vessels to docks. They are also used to load heavy parts into ships under construction.

Mr Lee Jae Kyu an analyst at Mirae Asset Securities Co in Seoul said that “It will probably take six months to a year to get those cranes replaced and it will be inevitable that vessel deliveries will be delayed. Delays will hurt the creditability of the Chinese yards and could prompt ship owners to look to rivals in Korea.”

According to London based Clarkson Plc, Hudong Zhonghua is the world's 11th largest shipyard with a backlog at the end of April of 2.42 million compensated gross tonnes.

It is reported that Taiwan’s long product prices soared as a whole last week and continues its upward trend.

The price of steel rebar has been rose by TWD 700 per tonne last week, as the new price is between TWD 31,200 per tonne and TWD 31,700 per tonne.

China Steel Corp announced that its new price of third quarter. Price of steel bar and wire rod has increased by TWD 4,830 per tonne. Price of CHQ wire has reached TWD 29,750 to TWD 30,000 per tonne.

Besides, Feng Hsin Iron and Steel raised its section steel prices of angle bar, channel steel, flat bar and square bar by TWD 1,000 per tonne. Current selling price is at TWD 32,000 to TWD 32,300 per tonne.

(Sourced from YIEH.com)

Outotec has agreed with Petroquímica de Venezuela SA for the delivery of engineering and imported equipment for a new sulfuric acid plant to be built at Morón in Venezuela. The value of the contract is approximately EUR 90 million.

Outotec has provided the concept and basic engineering for Pequiven for the same project in 2007. In this second phase Outotec's scope of delivery covers engineering and supply of imported equipment.

The plant is designed to produce 3,000 tonnes per day of sulfuric acid for Pequiven's phosphate based fertilizer production. The start up of the plant is scheduled to begin in the first quarter of 2010.

Mr Tapani Järvinen president & CEO of Outotec said that "This contract demonstrates our capability to apply our technologies beyond the mining and metallurgical industry in other process industries, such as fertilizer industry. We have been a major designer and supplier of sulfuric acid plants for more than 80 years, with a track record of over 600 plants installed worldwide. This new contract will further strengthen our market leadership.”

Bloomberg reported that UAE shares advanced, led by cement companies on speculation increasing demand for properties will boost their profits.

Ras Al Khaimah Company for White Cement & Construction Materials rose to its highest in more than two years. Umm Al Quwain Cement Industries Company and Gulf Cement Company also gained. Union Properties advanced for a third day.

The Abu Dhabi Securities Exchange General Index added 0.8% to 5,037.85, while the Dubai Financial Market General Index rose by 0.2%, gaining for a third day.

Mr Mohamed Salem a trader at Al Futtaim HC Securities said that "Cement companies are extremely attractive because of soaring demand for properties and the shortage of cement makers.'

According to data compiled by Bloomberg, ADX Construction Index, a measure of 10 construction companies, trades at an average of 12 times trailing earnings. That compares with a multiple of 15 for ADX General Index.

Mehr News Agency reported that Iranian carmakers produced over 156,000 cars in the March 20th 2008 to April 20th 2008 period down by 27% YoY.

This is while the deputy minister of industries and mines for industrial affairs, Mr Danesh Marnani has been surprisingly quoted as saying that "Statistics indicate increase in production."

Real estate firm Emaar MGF Land, Indian JV of Dubai's Emaar Properties, said that it plans to spend USD 3 billion in developing properties in south India over the next few years.

Besides a residential property in Hyderabad with an outlay of USD 1.4 billion, Emaar MGF will invest in commercial and retail properties and hotels spread over 31 million square feet in 10 south Indian locations.

Emaar MGF in February 2008 called off a USD 1.6 billion initial public offering because of tepid investor interest.

Masdar to invest up to USD 2 billions in photovoltaic solar energy

Abu Dhabi based Masdar has announced that Masdar PV will embark on a multi billion dollar investment in thin film photovoltaic solar technology, as part of its drive to become a world leader in alternative energy.

The total investment of approximately USD 2 billion represents one of the largest investments ever made in solar and will fund a 3 phased manufacturing and expansion strategy to produce the latest generation of thin film photovoltaic modules.

Out of the total planned investment, phase one of the project involves an investment of USD 600 million, which will fund the development of two manufacturing facilities. The first, in Erfurt in Germany will be operational by Q3 2009 and a second facility in Abu Dhabi which will begin initial production by Q2 2010. The combined annual production capacity of these two sites will be 210 MW, which is committed to major PV system installers in Europe and for Masdar’s own energy generation needs.

Masdar chose Germany as the site for its first plant because Germany is currently the center of the global PV industry. This German plant will act as a reference plant for technology and knowledge transfer to the larger Abu Dhabi plant by a joint German Abu Dhabi team.

Dr Sultan Al Jaber CEO of Masdar said that "Thin film PV is a key part of our build deploy develop strategy to actively build a strong position in alternative energy. The investment in photovoltaic solar energy will compliment Abu Dhabi’s existing energy market. Abu Dhabi is a global energy leader, so it makes sense to engage these new energy technologies to maintain leadership and become a global energy hub."

Khaleej Times reported that Dubai’s non oil foreign trade volume has jumped up by 46% YoY in the January to March 2008 quarter, reaching AED 214 billion as against AED 146.5 billion in January to March 20007 quarter. During the quarter, Dubai’s exports recorded a phenomenal growth soaring by 79% YoY, while re exports went up by 73.5% YoY and imports grew by 49.7% YoY.

The latest statistics, compiled and released by Dubai World’s Statistics Department show that Dubai's direct non oil foreign trade, excluding free zones and customs warehouses, amounted to AED 143.8 billion during the January to March 2008 quarter as against AED 91.53 billion for the January to March 2007 quarter, showing an increase of AED 52.3 billion.

Mr Sultan Ahmed Bin Sulayem chairman of Dubai World said that "The figures released by Dubai World Statistics Department underscore the buoyant commercial growth of the emirate, reinforcing Dubai’s reputation as a major commercial hub. The growth is fuelled by the government’s relentless efforts to upgrade the existing modern infrastructure of ports, airports and land transportation network, connecting Dubai to the world."

He added that "The growth of Dubai’s non oil economy also comes as a result of the noticeable rise in the international oil prices, which led to a corresponding increase in government income and the public spending on developmental projects. The unprecedented construction boom and the tourist and commercial development are also factors which largely contributed to this growth."

India topped the list of Dubai’s direct import destination in the first quarter of 2008 with a share of 13.14% of total imports worth AED 12.6 billion. China came second with AED 10.7 billion, followed by Switzerland with AED 7.2 billion. India, China and Switzerland together accounted for 31.8% or AED 30.5 billion of Dubai’s total imports, while imports from other countries accounted for 68.2% or AED 65.6 billion.

GE Energy recently announced that it has signed contracts worth more than USD 500 million to supply gas turbines and generators for power plant projects owned by Saudi Electricity Company.

In the first agreement, GE Energy has received a contract to supply gas turbine generators for the 960 MW expansion of the Rabigh Power Plant in Rabigh City, on the west coast of Saudi Arabia. The project is part of SEC's initiative to provide additional power to support the region's economic and population growth.

In addition to the Frame 7EA gas turbines at the Rabigh site, GE's scope of supply includes Type 7A6 generators, technical advisory services during installation and spare parts. The EPC contractor for the project is the National Contracting Company Limited of Al Khobar.

Further expanding its presence in the Middle East's rapidly growing power industry, GE Energy also has received a contract for gas turbines that will be used by four power plants owned by SEC.

Mr Joseph Anis GE Energy's region executive for the Middle East said that "These projects are part of SEC's on going efforts to meet the region's soaring power demand. Our capability to provide gas turbine technology with a short delivery cycle, plus the proven reliability of our gas turbine technology, was key factors in winning these contracts."

GE maintains a workforce of more than 600 employees in the oil rich Gulf Kingdom with offices in Jeddah, Riyadh and the Eastern Province, as well as joint ventures in the fields of energy, healthcare and appliances. GE's current business portfolio in Saudi Arabia includes power and water, transportation and healthcare, in addition to new opportunities in financial services and advanced materials.

Business Recorder reported that Pakistan’s external debt witnessed a rise of over USD 5.5 billion to hit a new peak of some USD 44.59 billion during the current fiscal year mainly due to rising current account deficit.

As per Fiscal Responsibility & Debt Limitation Act, 2005, the government has to reduce its foreign debt by 2.5% every year and current year it should be 24.5% of GDP from 27%. However, during the current fiscal year it is difficult for the government to meet this target due to rising current account deficit and it is expected that by the end of June 2008 it would remain at 27% of GDP.

Economists said that the government has borrowed some USD 5.58 billion foreign debts during the first three quarters of the current fiscal year to meet its over USD 10 billion current account deficit. They said slow foreign inflows coupled with declining foreign investment and sluggish privatization process compelled the government to use the tool of borrowing to fulfill its foreign payment requirements.

After the current upsurge, first time in the history of the country, overall foreign debt that earlier stood at USD 39.008 billion on June 30th 2007, rose to historic level of USD 44.596 billion by the end of March 2008. External debt and liabilities showed an increase of 13.45% to USD 45.926 billion till March 2008. It previously stood at USD 40.481 billion on June 30th 2007.

Economist said that during the first three quarters of FY08, the country faced USD 9.85 billion current account deficit because of high goods and services trade deficit as compared to some USD 6.16 billion deficit during the same period of last fiscal year, which forced the government to use foreign exchange reserves and borrow from international financial institutions.

During the current fiscal year, the government utilized some USD 3 billion from foreign exchange reserves and some USD 3 billion of foreign investment to meet current account deficit, while remaining gap was bridged through new foreign loans.

Al Bawaba reported that Emirates District Cooling Company Llc, a JV between Union Properties PJSC and M’Sharie, has signed a Syndicated Islamic Finance Facility of AED 669 million with seven leading banks to fund the first phase of its AED 2.5 billion expansion plan.

The Syndicated Islamic Finance Facility is arranged jointly by Badr Al Islami, Standard Chartered Bank and Emirates Islamic Bank as Initial Joint Mandated Lead Arrangers. The Commercial Bank of Dubai, Dubai Islamic Bank, Emirates Bank International and Union National Bank acted as Joint Mandated Lead Arrangers in the syndicate.

The signing ceremony of this Syndicated Islamic Finance Facility agreement was attended by Mr Anis Al Jallaf chairman of Dubai Investments & Union Properties, Mr Khalid Kalban MD & CEO of Dubai Investments, Mr Abdul Aziz Yaqoob Al Serkal MD of M’Sharie and also chairman of EMICOOL and Mr Simon Azzam CEO of Union Properties.

Mr Al Serkal said that "This syndication opens up new strategic avenues for EMICOOL and will help to set the company on a sustainable high growth trajectory. We view the enthusiastic response from the banking community as further proof of EMICOOL’s distinguished market reputation and excellent growth potential. We are also pleased that we were able to secure the financing at a rate that, under prevailing market conditions, can be considered extremely competitive."

Mr Abdul Aziz Serkal said that "EMICOOL has drawn up ambitious plans for the future, and continued expansion of production capacity forms the centerpiece of our business strategy. As the demand for District Cooling is continuously on the rise across the UAE and Middle East region, it has become imperative for EMICOOL to optimize production capacity and further enhance its technological capabilities to meet growing market requirements more efficiently."

He further added that "The financing proceeds will mainly be used to fund EMICOOL’s projects at Dubai Motor City and Dubai Investments Park. EMICOOL estimates that its ambitious expansion plans will require an investment of AED 2.5 billion over the next 5 years. In this regard, EMICOOL expects to raise twice the amount of the current syndication in the future to refinance the existing facility and meet future requirements."

Mehr News Agency quoted Mr Mohammad Ali Zardbani MD of Iran Petrochemical Commercial Company as saying that it plans to export USD 1 billon worth of petrochemical products to China this Iranian calendar year.

Mr Ali Zardbani said that "China alone accounts for importing 10.5% of Iran’s petrochemical export bound products." He added that in last Iranian year ended March 19th 2008, IPCC exported USD 590 million worth of petrochemical products to china.

Mr Zardbani also added that the company’s total exports amounted to USD 5.5 billion in last Iranian year, of which 30% was sent to the Far East, 32% to the Middle East, 13% to Europe, 10.5% to China, 5% to India and the remaining 9.5% to other Asian and African countries.

He also noted that the amount of petrochemical products imported to Iran in the previous Iranian year was not significant. He added that "We imported less than USD 100 million worth of petrochemical products. Caustic soda was the import staple which is widely used in many industries."

IPCC has already announced that it exported over 1.5 million tonnes of petrochemical products valued at approximately USD 1.26 billion since the beginning of the current Iranian year.

According to a report issued by the Iran Petrochemical Commercial Company, the total value of the exported petrochemical products since outset of the current Iranian year amounted to USD 1.26 billion.

Iran’s total petrochemical product’s export volume during this period reached 1,554,000 tonnes. 24 various kinds of petrochemical products have been exported of which during this period, methanol stood at the first place with a total of 300,000 tonnes export volume.

IPCC’s total sales value in the previous Iranian calendar year was about USD 8.3 billion of which about USD 5.5 million was earned from exportation and the rest from domestic sales.

Methanol, ethylene, propylene, butadiene, LAB and PTA are the major exported petrochemicals.

China Iron & Steel Association released a statement on May 29th 2008 formally denying the rumor that Beijing is to introduce a tougher export tax policy on June 1st 2008 adding that such rumor would destabilize the export and import markets, and threaten the country overall economic health as the country struggles with post-earthquake reconstruction.

The market analysts believe there is little chance to see tax policy change on steel products before fourth quarter, although they have not ruled out the possibility of further move from Beijing within this year, learned by China Securities News.

CISA official said that the government's efforts to suppress excessive steel export have already taken desirable effect, leading to a substantial decrease of finished steel products and semis export in the first four months of this year.

Mr Zeng Jiesheng senior analyst of Mysteel said that China's monthly steel products export would stay above 5 million tonnes for May and June and hover over a high level in the third quarter and the steel export would add up to 42 million tonnes in the first three quarters. He said that it is quite clear that the steel export is set to rebound, forcing the central government to go in for tougher tax policy within this year, but that might not happen before the last quarter.

Mr Zeng Jiesheng said "Last year's tightening efforts have already paid off and received the expected impact. And the authority also realizes that too frequent policy change would have backfire impact on driving up speculative steel export boom".

Moreover, Beijing would also take into account China's overall dipping trade surplus growth. And as long as the strong global demand stays here, higher export tax would continue to push up the export price and tonnage and thus, prop up the domestic price.
(Sourced from MySteel.net)

It is reported that Chinese plate export market seems to be a bit slowed down recently since transactions have softened. Export offers do not see further increase and exporters started to become cautious on market situation in June.

Export offers for commercial plate by tier two producers are at around USD 1130 per tonne FOB to USD 1150 per tonne FOB, but transactions are reported to be a little difficult.

By comparison, a tier one steel producer in East China was offering 12mm to 40mm commodity grade plate at USD 1170 per tonne to USD 1180 per ton FOB as base. It indicates that contracts for shipments to South East Asia have dropped sharply and those for Middle East are getting better. Exports to the EU remain common.

(Sourced from MySteel.net)

It is reported that there has been price inversion between hot galvanized coil and cold rolled coils in China since August 2007 as price for HDG is lower than that of CRC. The oversupply and dependence on exports are believed to be the major reasons behind the lower HDG price.

In recent years, HDG capacity and production have witnessed great increase. Annual HDG output has been growing at a level higher than 40% since 2004. However, the growth rate started to drop since the second half of 2007. Subsequently, lots of HDG flow to international market and the proportion of exports to total output is also on the increase. In 2006, total Chinese HDG exports reached 2.87million tonnes accounting for 23% of domestic production. But the export tonnage began to drop remarkably following the rebate cut in 2007.

Most of Chinese HDG exports go to the EU and USA and the export volume is highly dependent on the demand of western countries. USA, Belgium, Italy, Spain and Britain are top five destinations for Chinese HDG exports and the tonnage for above mentioned countries account for 52% and 43% respectively of total exports in 2006 and 2007.

However, the export rebate cut, the continuous CNY appreciation and slower economy growth in the EU and USA has led to less Chinese HDG exports. The tonnages for Q1 2008 dropped to 520,000 tonne up by 38% YoY. Further he proportion to output went down to 13%.

By comparison, there are net imports of CRC and the import volume is 100% higher than that of exports. The exports only account for 10% of total production and there is no dependence on international market.

The decrease in export volume and continues increase in HDG capacity have brought pressure on price. However, the small premium over CRC or price inversion would also restrain the release of new capacity. Thus it is noticeable to pay much attention to export market and situation of supply.

(Sourced from MySteel.net)

It is reported that Chinese construction steel prices have leveled off this week and they are likely to pick up again later.

Shanghai market prices are largely unchanged.HRB335 20mm rebar is being quoted at CNY 5340 per tonne to CNY 5350 per tonne, HRB400 at CNY 5590 per tonne to CNY 5620 per tonne, flat with last week. Price for commercial wire rod remained at CNY 5800 per tonne that for hi speed material is tagged at CNY 5910 per tonne.

While rebar and wire rod prices in Beijing market have seen remarkable rebound. 6.5mm hi speed wire rod by Tangshan is being quoted at CNY 5950 per tonne a jump of CNY 350 per tonne recently. HRB335 and HRB400 16mm to 22mm rebar price move up by CNY 100 per tonne to CNY 120 per tonne to CNY 5590 per tonne and CNY 5800 per tonne respectively.

Mysteel said domestic rebar and wire rod prices are expected to see another round of increase, bolstered by robust demand, low output, increasing production cost and high international market price. Taking Shanghai price for HRB335 20mm rebar as benchmark, it is expected to approach CNY 6000 per tonne after exceeding CNY 5500 per tonne.

Export prices remain at high level and allocations are said to be quite tight. Offer for rebar with vanadium are normally at USD 1100 per tonne to USD 1140 per tonne FOB.

Sources say that Shagang has concluded 120,000 tonnes rebar exports early this month and the average contract price is USD 1000 per tonne FOB. Despite price inversion with market price it shot up its ex works price by CNY 350 per tonne due to electricity limit and maintenance in June.

(Sourced from MySteel.net)

It is reported that the continuous annealing lien in Five CR Strip Project was commissioned in Baosteel on May 27th 2008 and it produced the first coil of steel successfully.

Both capacity and surface quality complied to design index and demand from consumers. It meant that Baoshan Iron and Steel Company will add more high precision, high strength, high quality surface products in carbon steel series.

Continuous annealing line is one of main lines in Five CR Strip Project with a design capacity of 700,000 tonnes per year. The units adopted the world’s most advanced equipments.

Bloomberg reported that China, the world's largest consumer of metals and grains may allow qualified foreign investors to buy its commodity futures contracts.

Mr Lao Guangxiong deputy CEO of the exchange said the plan is under consideration. He said that allowing qualified foreign institutional investors known as QFII may make the Shanghai exchange a better platform for futures trading.

Mr Lao said the Shanghai Futures Exchange will probably introduce futures for steel products this year. He said that “Our preparation for steel product contracts, including the ones for reinforced bars and steel wires is mature. We need approval from regulators.''

Ms Wang Lihua chairwoman of the Shanghai Futures Exchange said “Because of the US subprime crisis, Chinese regulators are more cautious about risk control, so it's hard to set a timeframe for introducing QFII to the Chinese commodities market.''

It is reported that Anshan Steel accelerates its expanding steps to South China and Ningde Steel Project is likely to be approved.

Mr Zhang Xiaogang GM of Anshan Steel said that the production arrangement is one of key strategies in Anshan Steel this year. He said that Anshan Steel is now programming for a CR plant together with a steel company in province Fujian. The result would come out in two months. He added that province Fujian would still be the location of steelworks even if they fails in the negotiation, because it is an overall strategic arrangement in Anshan Steel Group.

Mr Chen Rongkai official in the city of Ningde said in the end of last year that the provincial government in Fujian has signed frame agreement with Anshan Steel and Ningde has already finished the investigation on 12 million tonnes steel project. He indicated that 1.2 million tonnes CR project which is the first phase of the project with an investment of CNY 5 billion would start soon. However, Mr Zhou Xizeng analyst from CITIC Securities believed that it would take one or two years for the project to start.

Mr Zhou Xizeng said “If Zhangwan Steel Project is approved and there could be five new super sized steel projects in China together with Shougang Caofeidian Project, Shandong Steel Rizhao Project, Wisco Fangchenggang Steel Project, Baosteel Zhanjiang Project. The coast arrangement in Chinese iron and steel industry would be completed.”

It is reported that Sheffield heavy engineering company DavyMarkham has fabricated and shipped a 320 tonnes Cutterhead for a 12.4 meter diameter tunnel boring machine being built by The Robbins Company of Ohio.

As per report, fabricated in six sections and test assembled at DavyMarkham’s Sheffield works prior to dispatch, the Cutterhead and associated Main Beam TBM are being finally built by Robbins in a massive underground launch chamber, pre excavated by drill and blast methods. The same on-site assembly technique was also employed on the earlier Niagara Falls TBM contract for which DavyMarkham again supplied the Cutterhead.

In a contract valued at EUR 1.15 million, the Sheffield firm applied precision engineering standards to the heavy machining and fabrication. In order to improve competitiveness when dealing with such large steel pieces, DavyMarkham employed a newly developed cutting tool for rough machining, which resulted in a metal removal rate 5 times faster than normal, and deployed the latest carbide U-drill technology, which cut holes 8 times faster.

After test assembly, the Cutterhead was disassembled and shipped in manageable sections from Southampton to Shanghai, for onward freighting to Sichuan Province. Tunneling is scheduled to start in spring 2008 after on site assembly, with the TBM boring the first of four headrace tunnels through a complex geography of marble, shale and limestone, as well as coping with large inflows of water.

It has been dispatched to the mountains of Sichuan Province in China where it will be instrumental in one of the biggest TBM-driven tunneling projects in Chinese history for the new 4,800MW Jinping II hydropower station on the Yalong River. Once completed in 2010, this will be the largest power station in an ambitious project for owners Ertan Hydropower Development Company which will transmit electricity to many eastern provinces and such cities as Shanghai and Beijing.

For the Jinping II project, the 12.4 meter TBM will bore a headrace tunnel almost 17 kilometer long and one of the longest in the world, which will deliver water under pressure to the turbines of the hydropower plant currently under construction. DavyMarkham fabricated the machine’s main Cutterhead in six separate sections, for ease of shipping and lowering below ground: one inner head weighing 60 tonnes, another at 52T and four outer segments each weighing 38T, all incorporating free-issue 19” cutters supplied by Robbins.

It is reported that China steel product import from different countries in 4 months is as under

(In tonnes)

(Sourced from MySteel.net)

According to China Chamber of Commerce of Metal Minerals and Chemicals Imports & Exports that MOFCOM had awarded Minmetals REACH Regulations Advisory Service Center of MOFCOM for a better assistance of domestic enterprises to deal with the registration, evaluation, authorization and Restriction of Chemicals (REACH).

The REACH regulations will be in actual operation since June 1st 2008 which includes pre registration period from June 1st to November 30th 2008 and formal registration period from December 1st 2008

CCCMC reminded that if enterprises do not take part in pre registration, their products will not allow entering European market from June 1st 2008 although it is allowed to export to Europe from June 1st to November 30th 2008. Once it is found that the products have not been registered after November 30th 2008 the importer will be punished and the supplier will also be traced. Enterprises that have not pre-registered will not be allowed to export to European market after the pre-registration.

It is reported China scrap steel import from different countries in 4 months is as under

(In tonnes)

(Sourced from MySteel.net)

It is reported that Danieli Corus has signed a contract for the design, supply and construction supervision for one sublance system including bottom stirring, an upgrade to the previously implemented static dynamic model and a waste gas analyser for converter No 3 at Shougang Jingtang Iron & Steel United Company Ltd.

As per report this is the second order for sublance equipment from Shougang Jingtang, a joint venture between Shougang and Tanggang.

The new Shougang Jingtang plant is being constructed on the Caofeidian Island, some 80 kilometers south of Tangshan City, Hebei Province, PR China. Close to the plant, an entirely new city designed for 1 million inhabitants are being layed out.

It is reported that 9 colored steel suppliers in Hebei Province, who have taken the duty of supplying colored steel for prefabricated houses for earthquake hit region in Sichuan, have made a promise that they will supply the material without any increases in prices.

As per report, Hebei Province has asked to supply 80,000 prefabs which need colored coated steel.

Tangshan Iron and Steel Group Company Ltd, Handan Iron and Steel Group Company Ltd and other 7 companies will be in charge of steel supply.

It is reported that recently the application of Baosteel Ltd to issue convertible corporate bond for which the transaction of warrants is separated from the transaction of bonds was approved by China Securities Regulatory Commission.

In the following 6 months Baosteel Ltd is going to issue publicly CNY 10 billion convertible corporate bonds for which the transaction of warrants is separated from the transaction of bonds with CNY 100 par value. The term of bond will be 6 years.

As per report it was the resolution of the first interim general meeting of stockholders of Baosteel Ltd in 2007 that to speed up achievement of the new round development strategy of Baosteel, Baosteel Ltd was to issue CNY 10 billion convertible corporate bonds for which the transaction of warrants would be separated from the transaction of bonds for the purpose of buying from Baosteel Group the assets of Luojing engineering projects, investing in No 5 Cold Rolling Mill project & the supporting facilities and Cold Rolled Stainless Steel Strip Project, as well as adjusting the debt structure.

According to the articles for bond issuance, the final subscriber of each bond may gain the subscription warrants distributed by the issuer company according to certain ratio. The ratio of the exercise of all related warrants is 2:1, i.e. 2 subscription warrants represents the right to subscribe 1 A-share issued by the company. The original share holder at the time of issuance enjoys the preemptive right based on their tradable shares not subject to selling restrictions at the proportion of not lower than 40% of the total issue of this time. Baosteel Group, the biggest shareholder of Baosteel Ltd promises to guaranty for this issuance free of charge.

Baosteel Group credit rating by the Standard & Poor's is A- with positive outlook its guaranty will greatly reduce the risks to hold the convertible corporate bonds for which the transaction of the warrants is separate from the transaction of the bonds.

It is reported that the 40th Technical Committee Conference of International Iron & Steel Institute was held in Shanghai lately.

More than 50 experts, scholars, scientific & managerial personnel from ArcelorMittal, NSC, JFE, POSCO, ThyssenKrupp, TATA Steel, US Steel, Corus, BlueScope Steel, China Steel Corp, Baosteel, Germany Steel Federation, and CISA assembled together to discuss the development of world steel industry.

Before the conference, Mr Xu Lejiang Baosteel Chairman of the Board had a friendly exchange with Mr Mika Saariaho Deputy Secretary General of IISI the new elected chairman of the Technical Committee Lindbergh and the major members of IISI Technical Committee.
China steel industry represented by Baosteel has been developing rapidly these years which caught wide attention from the world steel industry. Therefore, IISI Technical Committee chose to hold this conference in China. Apart from the regular agenda, the special technical report from the hosting country was particularly arranged. As proposed by IISI and agreed by CISA, the special technical report from the hosting country was delivered by Baosteel.

As per report the delegation to the conference comprise personnel from Baosteel Science Association, Research Institute, Intellectual Assets Department, Environment & Resources Department, Mid-Heavy Plate Branch, Steel Tube Varieties Management Department, etc led by Mr Cui Jian Deputy General Manager of Baosteel Ltd. In the hosting country special technical exchange, Mr Cui Jian as member of IISI Technical Committee made the theme report of “Thoughts and practice on Baosteel Technical Management" in English.

5 managerial and technical personnel of Baosteel made 5 technical reports
1. Current conditions and strategic planning of Baosteel Energy & Environment Protection
2. Baosteel COREX-3000 Technology
3. Baosteel BSSF Steel Slag Processing Technology
4. Baosteel Research & Development in Automotive Sheet Technology
5. Baosteel UOE Technology

The participating experts took great interest in the reports and had an interactive exchange with Baosteel technicians on the relevant managerial and technical issues.

Xinhua reported that China will build seven production bases for new materials to boost the development of high-tech industries.

The National Development and Reform Commission said the bases would be built in Ningbo, Dalian, Luoyang, Jinchang, Guangzhou, Baoji and Lianyungang.

The report added that these bases will turn out new materials for industries covering information technology, biotechnology, aeronautics, new energy and environment protection.

The NDRC required that local government departments offer preferable policies for building these bases and create a sound environment for the development of high-tech industries.

South China Morning Post reported that Haixin Iron and Steel Group is hoping to bring in industrial investment funds as strategic investors.

The report added that the plan to take in strategic investors will help support an investment program that will raise capacity to 15 million tonnes within three years from the current 6 million.

Mr Li Zhaohui chairman of Iron and Steel Group said expansion was a matter of survival due to intense competition and rising costs.

It is reported that China’s color coated coils prices have been increasing due to strong demand and tight supply. The upwards trend for increasing prices is expected to continue.

As per report current prices of thickness 0.476mm and 0.23mm are prevailing at CNY 8,150 per tonne and CNY 10,300 per tonne respectively. However, domestic mills said that they will remain prices unchanged for those earthquake hit areas.

It is reported that recently, the 55 SiMoV high grade bearing steel has been successfully developed by Laiwu Steel Special Plant and Wafangdian Bearing Company.

As per reports, the major technical indicators have been matched and it is being said as a major milestone in special steel production in China.

55 SiMoV high grade bearing steel has high hardenability, high strength toughness, high fatigue life, high temperature resistance, impact resistance.

Laiwu Steel Special Steel Plant expressed that the successful development of 55 SiMoV high-grade bearing steel speeds up the business of direct selling process of special steel products. At present, Laigang special system has formed a product development chain from market research, research and development, production trial, market development, after-sales service and customer application technology research, product life cycle research etc.

It is reported that Mr Liu Rujun board chairman of Handan Steel and Mr Richard president of German Neu Shipping Company signed long term shipping agreement and established long-term friendly and cooperative relations.

Neu Group is committed to the international maritime transport services for the world’s well known steel enterprises. In September of 2001, Neu Group purchased Krupp Shipping Company, so Neu became one of the world’s largest shipping companies.

It is reported that CR sheet plant in Baosteel Branch commissioned continuous annealing line and No 2 electro tinning line which is the thinnest with highest mill speed in the world.

The design capacity of No 2 electro tinning line is 200,000 tonnes per year and main products are high quality and high grade tin plate for food packages. The biggest width is 1,050mm, while the minimum thickness is 0.1mm.

The capacity of the continuous annealing line is 400,000 tonnes per year in thickness starting from 0.15mm at a maximum speed of 800 meters per minute.

It is reported that Wuhan Steel raises prices for the third quarter by CNY 400 per tonne to CNY 700 per tonne on the basis of its June prices.

Plates
1.Up by CNY 400 per tonne for common carbon, low alloy and quality carbon products
2. Other products except quenched and tempered steel price up by CNY 500 per tonne
3. 14mm to 20mm Q235 plate is priced at CNY 6120 per tonne after the price increase.

Wire rods
1. Up by CNY 700 per tonne for steel tyre cord
5. Other products except common carbon products price up by CNY 800 per tonne

HR
1. Up by CNY 400 per tonne
7. Higher for coils and sheets with thickness of less than 3.5mm and width of more than 1300mm price up by CNY 100 per tonne
8. Latest EXW price stands at CNY 5550 per tonne for 2.75mm Q235 and CNY 5440 per tonne for 5.5mm Q235 HRC

CR
1. CR price up by CNY 400 per tonne
2. 1.0mm Q195 CR sheet is quoted at CNY 6230 per tonne
3. 1.0mm Q195 CRC is quoted at CNY 6230 per tonne

Coated
1. GI price up by CNY 500 per tonne.
2. Color Coated Steel price is unchanged.

Prices listed above are effective as of June 2nd 2008.

(Sourced from MySteel.net)

Guangzhou Daily reported that latest statistics show that Guangzhou Iron & Steel Corp Ltd has yielded 139,353 tonnes of crude steel and 114,198 tonnes of finished steel in May with sales revenue hit monthly record of CNY 788.21 million. The good performance was achieved against the backdrop of soaring prices for iron ore, coking coal and electric power.

Guangzhou employers said a total of 94,116 tonnes of qualified pig iron has been yielded in May.

Mr Huang Zhiwei senior official of the company said the company aims to produce 1.5 million tonnes of crude steel this year up by 26% from last year. He said that "We are confident to achieve the target."

Guangzhou Iron & Steel Corp Ltd has donated CNY 1.3 million to the disaster affected Sichuan province so far.

It is reported that Xinjiang based Bayi Steel has produced 1.94 million tonnes of crude steel and 1.84 million tonnes of finished products in the first five months of this year, sales revenue for the period has reached CNY 9 billion and is expected to break CNY 20 billion throughout this year.

Bayi Steel yielded 4.04 million tonnes of crude steel last year with sales revenue of CNY 13.7 billion.

Shanghai

HR coil price ascends by CNY 50 per tonne.
1500mm coil is priced at CNY 5800 per tonne to CNY 5850 per tonne 1800mm coil at CNY 6150 per tonne
Sheet prices rise by CNY 100 per tonne to CNY 200 per tonne with diameter 2.5mm SPHC posted at CNY 6500 per tonne and diameter 2.75mm Q235 at CNY 5980 per tonne
7.5mm low alloy product stands at CNY 6150 per tonne
CCS1810 is posted at CNY 6200 per tonne up by CNY 100 per tonne.

Beijing
HR price moves up
2.75mm coil is offered at CNY 5950 per tonne
7.5mm uncoiled plate is offered at CNY 5850 per tonne to CNY 5900 per tonne.

Guangzhou
HR prevailing prices push up
1500mm coil prices prevail at CNY 5900 per tonne to CNY 5950 per tonne
2.75*1250*C coil is posted at CNY 6300 per tonne.

(Sourced from MySteel.net)

Shanghai
CR price climbs up slightly
Angang 1.0mm sheet is quoted at CNY 7250 per tonne up by CNY 50 per tonne
1.2mm to 2.0mm sheet at CNY 7180 per tonne up by CNY 30 per tonne
Handan Steel made 1.0mm coil stands at CNY 7080 per tonne up by CNY 30 per tonne.

Beijing
CR price keeps unchanged with 1.0mm wider sheet posted at CNY 7100 per tonne.

Guangzhou
CR offers rise moderately
Angang 1.0mm CR sheet is posted at CNY 7180 per tonne
1.0mm CR coil price offered by Ma'anshan Steel stands about CNY 7100 per tonne

(Sourced from MySteel.net)

It is reported that EU eliminated import quotas for metal products from Ukraine. The ruling becomes in power and is due to the Ukraine's accession to WTO.

The cancellation of quoting imports from Ukraine is positive news for Ukrainian exporters. Though there is room to double exports of metal products to the EU market to 2 million tonnes to 2.5 million tonnes and believe that domestic steelmakers will not aggressively increase their shipments in the near future.

Millennium capital analyst said that “A moderate export growth rate of 5% to 7% annually seem to be one that will not provoke new antidumping investigations against Ukrainian steel industry. It should be mentioned that the quotas were abolished after Ukraine cancelled its barriers for scrap exports. The latter is negative news for Ukrainian steel sector as there is a deficit of scrap in the country.”

(Sourced from Millennium capital)

It is reported that Gazprom will be able to start laying of the largest gas pipeline on the treasure peninsular, Yamal. In early April, Vyksa Steel Works part of United Metallurgical Company manufactured and shipped the first commercial batch of large diameter pipes for construction of the ground section of the Bovanenkovo-Ukhta Gas Trunk-Line System.

According to Mr Nikolai Zaitsev sales director of OMK Pipe-Rolling Division, that in Quarter III when we start shipments under this part of the project, the company will be one of the key suppliers.

Mr Alexander Ananenkov Deputy CEO of Gazprom during his visit of Vyksa Steel Works said the pipe manufacturers' peace of mind pleases Gazprom too, the less nervousness and haste the higher quality. He said that "We have determined the necessity of three year planning because the plant should know more precisely product requirements and qualitative characteristics which will be set by Gazprom. And not only three year planning we also discussed issues of medium term planning with the OMK management so that Vyksa Steel Works could more uniformly allocate and consider capacity development for that growing Gazprom's program which actually exists today."

He added that "Gazprom's annual requirement for large diameter pipes is 1.5 million tones. This requirement is growing and in the nearest future it will reach the peak level of 2 to 3 million tones. He also said the question is about large scale projects of Yamal's transport system, South Stream, North Stream, the trunk line system in the east of the Russian Federation. Suffice it to say that the length of the Yakutia-Khabarovsk-Vladivostok gas main is 3,975 kilometer. It is required to manufacture this pipeline first. And, naturally, Russian plants will have orders for manufacture of this pipe."

As per report commercial development of Yamal's deposits will enable to bring gas recovery on the peninsula up to 250 billion cubic meters per year. All in all, 11 gas fields and 15 oil gas condensate fields are stricken on the peninsula. The ultimate reserves of Yamal's largest fields: Bovanenkovskoye, Kharasaveiskoye and Novoportovskoye are 5.9 trillion cubic meters of gas, 100.2 million tonnes of condensate and 227 million tonnes of oil. The top priority development target on Yamal is deposits of Bovanenkovskoye field. Its design gas capacity has been determined as 115 billion cubic meters per year. In the longer term, the design gas capacity must reach 140 billion cubic meters per year.

Reuters reported that Bombardier Inc has agreed to form a JV with Russia's CJSC Transmashholding to develop a news series of locomotives. The new engineering joint company will be located in Russia.

Bombardier and Transmashholding will have equal shares and rights in the venture, which will develop new locomotives for both the Russian and other markets.

Transmashholding is the major supplier of rolling stock for JSC Russian Railways.

It is reported that Volga-FEST the Frolovo Electric Steel Plant continued increasing its production recently.

Mr Yury Vassilyevich Druzhinin GD of Volga-FEST said that “Over the first quarter of 2008 we’ve reached a record high volume of steel square billets production 62,0 tonnes. The output of steel square billets in March of 2008 was 22,300 tonnes. Increase of production was reached due to installation of experimental furnace lining and further increase of refractory durability up to 800 melts.”

He said that over three months of 2008 shipments of finished products to consumers exceeded 75,100 tonnes to a 15% increase over the first quarter of 2007. Growth of production over the previous years is obvious in 2007 Volga-FEST increased the production of square section billets by 12% and the amount reached 221,000 tonnes. Shipments of finished products to consumers in 2007 reached 208,900 tonnes.

In late 2007 an important decision was taken concerning a two stage upgrade of the plant. Its main purpose is to increase steel making up to 480,000 tonnes per year and reduce the production costs.

1. The first stage of upgrade envisages the increase of production of the operating arc furnace up to 320,000 tonnes per year. It is to be completed in the third quarter of 2009 and the estimated investments in the development of electric furnace melting shop and drop hammer plant exceed EUR 25 million.

2. The second upgrade stage is to take 1.5 years and envisages the installation of a new continuous casting machine with the productivity of 480,000 tonnes of finished products per year. The investments are expected to reach about EUR 11 million. Implementation of the whole technical re-equipment program at Volga-FEST is planned to last till 2011.

The ESTAR managing company also decided to start the construction of the second electric-furnace melting shop and section rolling shop for fittings production near the existing facilities. Launch of new facilities will increase the number of workplaces almost three fold that is an important social objective for Frolovo and currently a substantial number of Frolovo residents 722 people are working at the enterprise.

It is reported that the Nabucco Consortium has recently undertaken a CAPEX update based on an actual market survey amongst major material and service supplies and found that the high price of crude oil and rising demand for steel cause increase of investment.

Mr Reinhard Mitschek MD of Nabucco Gaspipeline International said “Since then, crude oil prices have more than doubled which consequently has also led to higher prices for all primary energy sources also prices for steel. In addition, steel is in high demand because of the large numbers of big projects and steel companies also capitalize on this high demand."

He said that “The project investment costs for Nabucco to build a 3,300 kilometer long pipeline to carry 31 billion cubic meter of natural gas are now expected to reach EUR 7.9 billion as of the figures of today."

Mr Mitschek said “Such investment increases are in line with all major infrastructure projects, which require a high amount of raw materials as all are facing the same pricing challenges. However, the competitiveness and the economics of the project will be unaffected."

He added that “High demand for energy leads to higher gas prices as well and therefore also to higher transportation fees which make Nabucco considerably profitable."

Nabucco Gaspipeline International GmbH will start a market sounding in mid June in preparation of the open season process.

According to a data revealed by the Auto Consulting Group shows continuing strong growth in passenger car sales in the January to April 2008 period up by 61% YoY. The leading car models are those produced locally with Lada, Daewoo, Hyundai, Skoda and KIA all in the top 10 in terms of sales.

Millennium capital analyst said that “The news is good for the listed automotive engineering companies Lutsk Automobile Plant and Zaporizhya Automobile Plant. LUAZ in particular could benefit as its parent company Bogdan Automobiles has just released production figures as well and they are good a 55.2% YoY increase for 4 months 2008.”

(Sourced from Millennium Capital)

Itar-Tass cited Mr Sergei Ignatyev chairman of the Central Bank of Russia, while speaking the opening of the 17th International Bank Congress, as saying that over four months of 2008, Russia’ s gross domestic product increased by 8.3%.

He said that profits grew in the processing industry, construction and trade and incomes of the population increased by 11.3% over this period. He added that inflation amounted to 6.3% over this period, and over the same period of 2007 by 4%.

Mr Ignatyev said that the acceleration of inflation is caused by two reasons. The first reason is a considerable inflow of net capital in Russia 80 billion dollars and the second one is a quick growth of world food prices. He said that a very favorable situation has developed now for reducing inflation in the coming months in particular, because it is more difficult for Russian companies and banks now to borrow funds abroad.

The CBR head also said that “a favorable situation is developing at the market of foodstuffs first of all grain. World prices of grain are going down already, and the same tendency is being recorded in the Russian market too.

According to the forecasts of the Russian Ministry of Agriculture cited by Mr Ignatyev in July the price of grain will go down from the current level of RUB 8,500 per tonne to RUB 6,000 per tonne. Mr Ignatyev said that “It is evident that such a considerable drop of the price of grain will influence the level of consumer prices both of bread and other goods.”

Mr Ignatyev said the main responsibility for control of Russia’s inflation rests with the Central Bank of Russia. He said that “We are ready to use any methods to reduce it: interest rates, normative requirements, currency rates, but at the same time we’ll do it cautiously in order to avoid lowering of liquidity of the bank sector and slowing down of the economy’s rate of growth.”

According to the latest data of Rosstat since the beginning of the year, accumulated inflation has amounted to 7.5% and inflation from May 1st to 26th 2008 to 1.2%.

It is reported Universal Handling Complex launched in the port of Ust-Luga in June 2007 have renewed the membership of its share holders by the date of its first anniversary.

The Dutch Universal Cargo Logictics Holding controlled by owner of the Novolipetsk steel plant Mr Vladimir Lisin is going to increase its share in the Universal Handling Complex up to 100%.

According to Kommersant, in the next future there will be signed a contract on selling and purchasing the complex’s 25.05% share owned by Company Ust-Luga.

Ust-Luga confirmed that its share in the Universal Handling Complex will be sold. The sum of the deal is not announced. At the same time the company denied the gossips about the conflict between old and new shareholders of the complex.

As per report by purchasing of a 25.05% share of the complex UCL Holding will increase its share up to 75.05%. The rest 24.95% of the terminal Lisin’s company will buy from Progress group Foundation. The preliminary contract has already signed.

According to State Statistics Committee, Ukraine FDI in Q1 2008 rose by USD 3.4 billion or 11.4%. Total FDI amounted to USD 32.9 billion as of April 1st 2008.

Largest contributions to Ukraine's FDI stock were made by Cyprus 22.3% of FDI in Q1 2008 and 20.3% of total FDI, Germany 22.0% and 20.2%, Russia 11.4% and 3.6%, Austria 8.4% and 7.2% and the Netherlands 7.4% and 8.4%. At the same time direct investment from Ukraine increased by 2.4% in Q1 2008 to USD 6.2 billion. The largest portion of investments from Ukraine was directed to Cyprus.

The lion’s share of FDI to Ukraine was invested in the financial industry USD 6.1 billion or 18.6% of total FDI which increased by 25% in Q1 2008. The real estate business and wholesale and retail trade absorbed 8.9% and 10% of total investment respectively.
(Sourced from Millennium capital)

Ukrainian Journal Staff reported that China's Geely Group will soon decide whether it makes sense for the company to continue to assemble cars in Ukraine following the introduction of a 10% import duty on cars in Ukraine.

Mr Jie Zhao president of Geely Group told Interfax Ukraine that "Today, it's unclear when the 10% duty will come into effect and when that is settled, we will decide whether to continue car assembly in Kremenchuk or import cars."

RIA Novosti reported that production of oil and gas condensate in Russia dropped 0.3% YoY in January to April 2008 to 161 million tonnes.

The report added that the decrease was mostly down to the depletion of oil fields and delays in the opening of new deposits, as well as high taxes amid soaring global oil prices.

Russia exported 69.3 million tonnes in January to April 2008 down by 4.5% YoY while 12.4 million tonnes was sold to CIS countries, an association of former Soviet states up by 6% against the first four months of 2007. The increase in oil exports to former Soviet republics followed a hike in oil supplies to Belarus with crude exports to Ukraine and Kazakhstan falling.

Russia is expected to increase oil production 1.8% YoY in 2008 to 500 million tonnes.

RIA Novosti reported that Russia's natural gas output reached 234.3 billion cubic meters in the first four months of 2008 up 1.4% against the same period of last year.

According to preliminary estimates, Russian consumers received 165.2 billion cubic meters of gas in the first four months of 2008. It exported 76.7 billion cubic meters of natural gas in January to April 2008. Gas exports to countries outside the post-Soviet CIS totaled 62.3 billion cubic meters up by 35% YoY. Exports to other CIS countries reached 14.4 billion cubic meters, down 11.9%, due to a reduction in supplies to Ukraine.

According to government forecasts, Russia's gas output will rise 3% YoY in 2008 to 673 billion cubic meters.

Interfax reported that Colombia hopes Russian investment will increase in its energy sector.

Mr Diego Tobon Colombian ambassador to Russia said "We hope Russia will invest more in this sector. He said that Colombia is working to increase the extraction of hydrocarbons. Russia possesses know how for ground and underwater drilling which could be applied in Colombia's unexplored regions.

Mr Diego Tobon said this issue will be discussed among other things during Mr Francisco Santos's Vice President of Colombian visit to Russia.

Itar-Tass reported that a joint venture of Russia’s gas giant Gazprom and oil major LUKOIL has discovered a large off-shore oil and gas condensate field in the Caspian Sea.

The report added that the Tsentralnaya structure where the new field lies is in the center of the Caspian Sea’s middle part on the border between Russia and Kazakhstan. It took the joint venture, TsentrKaspneftegaz just one exploration well to strike oil.

The exploration work is proceeding. Three dimensional seismic explorations will be employed to identify the field’s size and outline.

The TsentrKaspneftegaz joint venture Gazprom and LUKOIL established back in 2003 on the parity basis acts in the capacity of Russia’s authorized operator of the Tsentralnaya structure. The KazMunaiGaz oil company is the authorized operator representing Kazakhstan.

Interfax quoted Economic Development Ministry said in a report that Russian exports of natural gas increased 22.7% YoY to 76.7 billion cubic meters in January to April 2008 compared to the same period of 2007.

The ministry said the significant growth in exports in the period could partially be explained by the low comparative base of demand for gas seen in January to April 2007 due to unusually warm weather" compared to the same period of 2006.

Russia increased gas production by 1.4% to 234.3 billion cubic meters in January to April 2008 compared to the same period of 2007.

Shareholders of Yasynivka Coke Plant decided to pay dividends totaling USD 309,000 on preferred shares and reinvest the remaining profits. The income distribution plan for 2008 promises no dividends for ordinary shares in the next year as well.

An analyst of Millennium Capital said that “The reinvestment of profits is logical since YASK is implementing a USD 200 million investment program which aims to double its output and reach a design capacity of 3.5million tonnes by 2011. By then YASK will have repaired and implemented charge thermal pre treatment technology at four of its six CB. This will allow decreasing consumption of expensive grades of coal. The first upgraded coke battery will be CB#4, which will come on stream in early 2009. We look positively at the plant and recommend accumulating the stock.”

(Sourced from Millennium Capital)

Interfax quoted source from the local division of the State Industrial Security Committee reported that a fire broke out more than 700 meters underground at the Chervonoarmiyska-Zakhidna coalmine in the Donetsk region of Ukraine.

Miners are currently being evacuated from the mine.

The source said he was not in a position to say exactly how many miners were in the fire stricken mine.

Mechel OAO a leading Russian integrated mining and steel group announced steel segment results for 2007 last week

1. Revenue from Mechel’s steel segment increased by 42.5% YoY in 2007 to USD 4.3 billion, or 65% of consolidated net revenue from USD 3.0 billion or 69% of consolidated net revenue in 2006.

2. Operating income in the steel segment increased by 37.3% YoY to USD 0.56 million or 12.6% YoY of total segment sales compared to operating income of USD 0.41 billion or 13.2% YoY of total segment sales in the 2006 full year period.

3. EBITDA in the steel segment for 2007 increased by 10.6% YoY to USD 0.73 billion over segment EBITDA of 0.66 billion in 2006. The EBITDA margin of the steel segment was 16.5% YoY in 2007 compared to 21.5% in 2006.

(In USD billion)

Mr Igor Zyuzin CEO of Mechel said “Although we successfully executed our plans to increase production capacity, the pricing environment for metallurgical products especially in the second half of the year remained challenging. With higher transportation costs and steadily growing prices for raw materials, scrap, electric power and gas, our steel products prices were flat to down. Record high nickel prices also affected profitability in Mechel’s steels segment, which is Russia’s largest stainless flat products producer. In addition, rebar market overstocking led to decreased pricing in the latter half of 2007, which put pressure on our profitability as we have a significant market share for long steel products. As a primary objective for the steel segment, we are continuing to concentrate on increasing output of high value-added products and achieving earnings growth through modernizing production facilities and controlling costs. Despite the ongoing high materials costs, we continue to see an improving economic environment for our products, which makes us optimistic regarding improved financial performance in the steel segment.”

MMC Norilsk Nickel has announces that during its board meeting Mr Denis Morozov GD and Mr Tav Morgan deputy GD have communicated their decision not to stand as candidates for election to the Board of Directors at the forthcoming AGM.

Mr Morozov said in a meeting "We believe that the interests of minority investors will be best served if their votes are concentrated on the independent candidates.”

The Board remarked that it accepted the decision and the underlying rationale. Mr Morozov's and Morgan's executive management responsibility will not be affected by this decision.

Under Russian company law, the system of cumulative voting for Board candidates means that the votes of minority shareholders participating at the AGM, if not aligned in favor of particular independent directors, could result in a less than proportionate representation of the minority shareholders in the Board of Directors.

Norilsk Nickel will issue detailed voting recommendations on all agenda items to be brought forth at the AGM and will present the Company’s financial performance at its results presentation next week and during its discussions with investors before the AGM on June 30th 2008.

RIA Novosti reported that Kazakhstan has ratified a treaty with Azerbaijan allowing Kazakh crude to be pumped through a pipeline linking Azerbaijan's Caspian coast to Turkey's Mediterranean coast.

Mr Nursultan Nazarbayev president of Kazakh signed a law recently ratifying the treaty on the Baku-Tbilisi-Ceyhan pipeline.

The report added that the treaty provides for the creation of a new system to carry Kazakh oil across the Caspian Sea to Azerbaijan, to be put through the BTC pipeline.

The 1,700 kilometer pipeline is expected to start operating at full export capacity of 1.6 million barrels per day in 2013, pumps crude from Azerbaijan's oil fields off the Caspian coast through Georgia to Turkey and on to Western markets.

Reuters reported that Metalloinvest plans to quadruple output of hot briquetted iron used in steel making with the aim of supplying over a fifth of world output by 2015.

Mr Maxim Gubiyev CEO of Metalloinvest said his company would build several new HBI plants to raise annual output to 8.8 million tonnes by 2015, much of it for export to Asia, as part of a USD 10 billion plus investment in its iron and steel production.

He said that "We have the intention eventually to increase HBI capacity to 10.5 million tonnes per year. The price of HBI, a freely traded form of processed iron fed directly into electric steel furnaces, has increased sixfold in the last five years as benchmark world iron ore prices have soared in response to China's hunger for the raw material.”

Mr Gubiyev said "We supply mainly to Ukraine and the Far East, but we see prospects for future sales within Russia. Potential clients are already in place but unfortunately we don't yet have enough HBI to satisfy demand. He said that the company would this month select the supplier of the third plant a RUB 34 billion project set to launch in 2011.

Metalloinvest runs two HBI plants at Lebedinsky with total annual capacity of 2.4 million tonnes.

RIA Novosti reported that Russia's leading uranium mining company, Atomredmetzoloto a subsidiary of state nuclear power company Atomenergoprom intends to start uranium prospecting in Namibia in the third quarter of 2008.

The report added that Atomredmetzoloto intends to set up a joint venture with a subsidiary of Russia's second largest bank VTB, VTB Capital Namibia, and investment company Arlan with headquarters in Namibia.

Atomenergoprom said Arlan will hold 75% minus one share in the JV, while Atomredmetzoloto and VTB Capital Namibia will possess 25% plus one share.

Atomredmetzoloto will prepare a feasibility study and act as the project's manager, while VTB's subsidiary will contribute two uranium prospecting licenses to the JV. Arlan will provide funds for the project, with initial investment estimated at USD 4.5 million.

The JV will carry out prospecting in the promising Klein Spitzkoppe area of southwestern Namibia. Prospecting is expected to last two or three years and yield uranium reserves of at least 5,000 tonnes.

Shanxi Taigang Stainless Steel Company Limited has issued a clarifying bulletin confirming that report on the company's trimming stainless output for June 2008 by China Securities Journal on May 29th 2008 is true.

Taigang Stainless Steel Company Limited will chop 30% of the 300 series HR and CR stainless productions for June 2008, on the basis of May output, and keep the HR plate and 400 series products stable, and this policy has been orally informed to its agents.

Taigang Stainless noted in its confirmation that it will actively respond to the drifting 300 series HR and CR stainless market amid volatile nickel prices and aim to stabilize the price and market by cutting contracted supply of the products.

In the meanwhile, it will take advantage of full flow and flexible production, raise output of better profitable chrome series, duplex, heat and corrosion resistant stainless and the carbon steel varieties.

(Sourced from MySteel.net)

It is reported that Venezuela and Cuba have confirmed the creation of a JV in the steel industry to produce and distribute stainless and special steel.

The new JV to be called Aceros del ALBA would be attached to the Cuban basic industry and Venezuelan mining ministry. The decree on the ratification was published in the most recent issue of the Venezuelan Official Gazette.

The source said that the group was created under the concept of an anonymous enterprise and its production will be commercialized at the national market, also destined to export to third markets, with priority to Latin America and the Caribbean.

The constitution of the enterprise was approved in the frame of the strengthening of the economic links between Cuba and Venezuela and the rational use of natural resources.

Venezuela works to become a power in the steel industry and get the second place after Brazil, with a goal of up to 12 million tonnes in a medium term. The government supports an investment of USD 3.5 billion to foster the national steel development, build more factories and optimize some others in the west of Venezuela.

Specialty Steel Industry of North America has released the corrected statistical data on imports, US consumption and import penetration for February 2008. The updated data is as follows

1. Stainless steel sheet or strip
Imports in YTD February 2008 were 83,824 tons, up by 14.3% YoY
US consumption was 241,045 tons, down by 9.7% YoY
Two month import penetration was 34.8%

2. Stainless steel plate
Imports in YTD February 2008 were 15,846 tons, down by 31.3% YoY
US consumption was 44,294 tons, down by 34.1% YoY
Two month import penetration was 35.8%

3. Stainless steel bar
Imports in YTD February 2008 were 19,370 tons, down by 8.8% YoY
US consumption was 42,100 tons, down by 2.4% YoY
Two month import penetration was 46%

4. Stainless steel rod
Imports in YTD February 2008 were 4,480 tons, down by 21.1% YoY
US consumption was 10,189 tons, down by 21.7% YoY
Two month import penetration was 44%

5. Stainless steel wire
Imports in YTD February 2008 were 6,738 tons, down by 8.4% YoY
US consumption was 12,310 tons, down by 11.7% YoY
Two month import penetration was 54.7%

6. Alloy tool steel
Imports in YTD February 2008 were 19,354 tons, up by 22.7% YoY
US consumption and import penetration were not calculable

7. Electrical steel
Imports in YTD February 2008 were 18,606 tons, up by 4.9% YoY
US consumption was 58,980 tons, down by 17.7% YoY
Two month import penetration was 31.5%

Interfax China reported that China's nickel prices are likely to continue their downtrend due to slight oversupply, but the slide will be limited by high production costs.

Mr Xu Aidong an analyst with Beijing Antaike Information said that "China's nickel prices will continue to fall due to slight oversupply pressure, which could be due to the influx of nickel imports from the decline in LME nickel prices. The average domestic nickel price will likely to stand at approximately CNY 200,000 per tonne this year."

Mr Zhong Yongqi GM of Shaanxi Energy Metals & Mining Resources Company Limited said that "Nickel prices have been falling since the end of 2007, which is mainly attributable to increasing nickel pig iron supplies and growing nickel production capacity. However, the plunge in nickel prices from more than USD 50,000 per tonne to about USD 23,000 per tonne has already made many high cost nickel pig iron producers halt production in China, which may give some support to the prices."

Mr Chong Dahai an analyst with Xinhua news agency said that "China's nickel pig iron output is estimated to reach 110,000 tonnes this year, up by 15.79% YoY, while refined nickel imports are expected to reach 120,000 tonnes in 2008 as compared with less than 100,000 tonnes in 2007. Meanwhile, China's demand for nickel is estimated to grow 20% from last year's 335,000 tonnes to approximately 402,000 tons this year, due to increased production of 300 series stainless steel."

However, Mr Chong also mentioned that China's stainless steel makers are now faced with near-saturation of the domestic market and a possible slowdown in exports with anti-dumping issues emerging in Europe. He estimates that China's stainless steel output will increase by 8.97% from 2007 to reach 8.5 million tonnes in 2008. Moreover, stainless steel mills are reported to have cut their production by another 30% due to difficulty in obtaining credit loans and high chrome ore prices.

Prices of Japanese stainless scrap are now around JPY 25,500 to JPY 26,000 per tonne. The main reason is that nickel price on the LME was falling since last week.

The International Nickel Study Group forecasts a nickel surplus of 70,000 tonnes this year. Besides, major stainless steel mills will continue to cut production in June 2008.

Japanese stainless steel mills will keep a close eye on scrap market developments

It is reported that the significant decline in the nickel price has slowed 2007 Southern African total stainless steel consumption to 197,070 tonnes up by 1.1% YoY over 2006.

Mr Michael Campbell outgoing MD of Southern Africa Stainless Steel Development Association said that up to May 2007, the nickel price climbed to USD 53,395 per tonne, dropping rapidly to about USD 27,000 per tonne. He added that "This left customers who had bought large volumes of stainless steel in a situation with high price tonnage. Being unsure of an increase or the stabilization of the nickel price, these customers were selling volumes into the market in an attempt to rapidly de stock. This resulted in fewer imports and domestic purchasing from large stainless steel producers."

Mr Campbell said that when SASSDA carried out a statistical survey in June 2007, results indicated that consumption was up by some 18% YoY over the figure achieved towards the end of 2006. This dropped to the 1.1% YoY figure reflected at the end of the year. Although the nickel price fluctuation slowed total annual consumption of stainless steel, there was an increase in primary local supply.

He said that certain infrastructure projects in South Africa should be able to drive a small, but steady, growth for the next few years. He added that "The whole country is working towards 2010, we can see a lot of the stadiums coming up and these are steel and stainless steel intensive. Beyond 2010, a lot of the power generation projects will be coming on line, such as Medupi power station, Project Bravo and possibly the pebble bed modular reactor. These projects will be the main driver for the growth of the stainless steel industry."

According to the recently released information by Chinese custom authorities, Chinese ferrochrome exports during April 2008 amounted to 45,683 tonnes.

In tonnes
(Sourced from MySteel.net)

It is reported that stainless steel AISI 304 can be laser beam treated to enhance corrosion resistance and improve surface properties. This alloy has many applications in auto industry, as well as in oil and gas industry.

Different conditions were applied in the laser beam surface treatment, namely, laser power density, scan speed, distance between paths, medium gas. After laser beam treatment, the samples’ microstructures were investigated using optical microscope to examine micro structural changes due to laser irradiation. Specimen surfaces were investigated using XRD, SEM and EDAX before and after laser-beam treatment to examine the surface composition changes brought about by laser irradiation.

Results showed that laser irradiation enhances the corrosion resistance of AISI 304 stainless steel to a large extent. Corrosion rates as low as 0.011 mpa for laser beam treated samples were obtained in comparison to 0.952 mpa obtained for the untreated samples.

Superior pitting corrosion resistance was obtained under specific treatment conditions. The enhancement of corrosion resistance depends on the laser irradiation conditions. The corrosion protection afforded by laser-beam treatment is attributed mainly to the grain refinement of the top surface layer. This layer is found to consist of nano scale grains.

The new UP turning inserts from Kennametal developed for the KENNA PERFECT turning system represent an improved turning geometry for demanding stainless steel applications.

The new design delivers improved chip control in 300 series stainless steels and provides a soft cutting action that result in lower cutting forces. The large rake angle provides less cutting resistance, which improves both surface finish on parts and extends tool life for increased productivity. The geometry design also improves resistance to a common insert failure namely depth of cut notching.

The UP geometry is available in the new KC9225, KC9240 and KC5010 grades, and in combination with the KENNA PERFECT turning system, is recommended for applications in the medical and food industries as well as flange manufacturing, the chemical industry and oil and petrochemical businesses, or wherever improved cutting performance in stainless steels is required.

Materials Technology Institute has published the Atlas of Microstructures, providing much needed data on the micro structural changes that occur in HP modified, HPMA, and 35Cr/45Ni cast alloy reformer tubes upon long term aging.

The MTI funded study fills an information void, picking up where a 1975 Battelle Columbus Laboratories report left off, covering the newer alloys used in industry today. In addition to documenting and illustrating changes that can occur with increased aging time and temperature, the Atlas of Microstructures provides identification and chemical composition of precipitated phases and includes diagrams characterizing the kinetics of phase transformation.

According to co author Mr John Hoffman of Air Products & Chemicals, the study is an in depth resource that will prove beneficial to companies ranging from cast alloy producers and end users to external laboratories and researchers.

Talleres Jois has replaced a conventional austenitic grade with Outokumpu’s duplex LDX 2101® in silos for atomized clay, achieving better durability, corrosion resistance and economy. New duplex LDX 2101® silos by Talleres Jois, both at the plant and just after installation at the customer’s site.

Clay answers for a good part of the Spanish economy. It is the raw material for tiles, bricks and other ceramics, which are some the country’s main export items. The products find their way to approximately 180 countries, and the trade is valued at more than 2 billion euros. To accomplish this, the industry consumes millions of tons of clay each year, atomized into a fine grain size.

To be able to handle the clay properly and ensure high product quality, clay suppliers need stainless steel silos for the intermediate storage and distribution of this aqueous product; if made from carbon steel, the silos would corrode and contaminate the clay.

Mr Juan Vicente Bono MD of Talleres Jois said that "Our experience with LDX 2101® has been very positive. Despite its high mechanical strength, it’s easy to bend and has good machinability. Overall, we are happy with the material, as well as with Outokumpu’s efforts to develop this new application with us."

Clay silos have traditionally been fabricated from the standard austenitic grade 1.4301/1.4307. Today, however, this grade’s standing in this application is challenged by the newcomer LDX 2101®, Outokumpu’s proprietary duplex grade.

While 1.4301 fights corrosion adequately well in clay silos, it suffers from abrasion caused by the stone product which is in frequent motion. To find a solution, Spanish ceramics technology providers have turned their eyes to LDX 2101®, attracted to the grade’s hardness that solves the problem, as well as to its many additional benefits that help enhance the competitiveness of the Spanish ceramics industries. Talleres Jois is the first to switch to LDX 2101®, having completed 40 new silos for the Spanish atomized clay supplier Nuevas Atomizadas in summer 2007.

With technical assistance and support from Outokumpu’s Spanish team, Talleres Jois convinced Nuevas Atomizadas that LDX 2101® would award them with a long maintenance-free service life. The grade has mechanical strength close to double that of austenitic grades, and better corrosion resistance compared to 1.4301. The strength allows for considerable reductions in material thickness, resulting in major weight savings. Importantly, LDX 2101® has a very low nickel content with 1.5%, which translates into good price stability at times of sharply fluctuating nickel price levels.

Talleres Jois fabricated the LDX 2101® clay silos for Nuevas Atomizadas from 2.5mm thick sheet, using 1.4301, sheet thicknesses must be between 3.0mm and 6.0mm. In the conical bottom section of the silos, the fabricator used 4.0mm thickness, down from the traditional 6.0mm.

It is reported that the governing council of Acerinox SA, at its meeting has agreed to the appointment of its current CEO Mr D Rafael Naranjo Olmedo as new chairman of the board of directors, replacing Mr Jose Maria Aguirre Gonzalez, who after having fulfilled its mandate was not eligible for re election.

The general meeting of shareholders held below, with a quorum of assistance from 83.6%, among others adopted the following agreements
1. Appoint independent directors of the company
2. Reducing the social capital Acerinox SA by 2% through the redemption of treasury stock
3. Distributing a supplementary dividend from the year 2007 as well as a refund from the share premium account for an amount of EUR 0.10 per share, payable in October 2008. The total annual remuneration to shareholders amounted to EUR 0.45 per share, plus a premium to attend the general meeting of shareholders held today from EUR 0.03 per share.
4. Following the recommendations of the unified code of good governance, has been amended Article 15 of the Articles of Association by removing the limitation on the counting of votes from 10% who could deliver a single shareholder.

Bloomberg reported that the congestion of ships awaiting iron ore cargoes in Brazil has increased as steel company buyers seek alternatives to supplies in Australia, where suppliers have delayed setting prices.

According to data compiled by port owner Vale, ships docked or due to enter major ports of Ponta da Madeira, Tubarao and Itaguai rose to 155 today up from 152 a month ago.

Mr Tebar Contente a Rio de Janeiro based representative for Canadian shipping company Fednav International Ltd said that “Fighting by Australian iron ore producers over contract prices has caused a rush on loading Brazilian iron ore.” He added that “There has been a big increase in demand from the Chinese, at a time when freight rates look set to continue at record highs due to high oil prices.''

He further added that unseasonably heavy rains are still the main cause of the queues of ships at Vale's ports because loadings take longer, a company press official said. Brazil's rainy season typically lasts from November to the end of April.

Mr Contente said that “We do not believe the situation is critical and Vale is unlikely to close ports to new arriving ships to ease the congestion. Vale has always honored its commitments.''

Vale settled 2008 contracts for annual iron-ore sales with international steelmakers between February and April, gaining price increases of 65% to 86.7% for contracts effective April 1st 2008. Australian rivals Rio Tinto Group and BHP Billiton Ltd have yet to settle on prices with customers.

According to China Statistics from customs, China's coke exports increased modestly in April 2008 to 1.343 million tonnes up by 98,500 tonnes or 7.9% MoM yet down 139,600 tonnes or by 9% YoY

Exports in the January to April 2008 amounted to 4.28 million tones down by 16.6% YoY. Average export price recorded USD 432 per tonne in April the highest level in the history. Highest quotation has come up to some USD 620 per tonne so far.

Robust domestic demand can be blamed for the mildly increased exports. Domestic price kept rising amid tight supply. Market rumor circulates that coke producers intend to raise price further as coking coal price will keep jumping. The price markup is expected to be more than CNY 200 per tonne.

(In 10’000 tonne)
(Compiled by www.Mysteel.net)

Herald Sun reported that iron ore rival Brazil has challenged Australia, unveiling a USD 27 billion plan to nearly double production of the steel making ingredient amid surging Chinese demand.

Mr Paulo Camillo Penna president of the Brazilian mining institute Ibram said that the investment would increase the nation's annual iron ore output to 650 million tonnes from 350 million tonnes over the next four years. That compares with Australian iron ore output of about 290 million tonnes this financial year and projected production of 489 million tonnes in 2012-13.

Vale the world's second largest miner after BHP Billiton and the biggest iron ore producer is expected to account for about 450 million tonnes of Brazil's forecast iron ore production in 2012.

The news marks an escalation in the already fierce rivalry between Australian and Brazilian iron ore producers, as both parties compete for a bigger share of the all important Chinese market.

BL reported that JSW Steel plans to invest approximately USD 500 million over the next three years to raise capacity of the iron ore mines it has acquired in Chile.

Mr Sajjan Jindal vice chairman & MD of JSW said told Business Line that “We have already paid USD 250 million to acquire 70% stake in the iron ore mine in Chile. Over the next three years we will be raising the capacity of the mines to produce 20 million tonnes annually. For this we need to invest another USD 500 million.”

He said that the company had acquired eight concessions in the mines located at Atacama in Chile through its Netherlands based wholly owned subsidiary for exploration and exploitation of iron ore deposits. He added that “The move is aimed to build up a natural hedge against rising iron ore prices in the international market.”

He added that the company expects begin commercial operations and start shipping of coal from these mines by the end of this year.

The iron ore mines in Chile have an estimated deposit in excess of 500 million tones. Mr Jindal said that “We would export the ore from Chile to China and source iron ore from the domestic market at international prices.”

Lloydslist.com reported that the Baltic Capesize Index again hit a new high of 18,749 points fired up by the world’s largest miner BHP Billiton as it continued a month long chartering spree.

The average Capesize time charter rate stood at an all time high of USD 222,757 per day as port congestion and strong demand for coal and iron ore cargoes to China outpaced the number of vessels available. The average charter rate has now jumped 28% in one month and more than two times the USD 80,000 per day seen during a dry bulk slump last January.

BHP Billiton secured another three capsize vessels for Western Australian loadings from mid June, including the payment of USD 235,000 per day for a Capsize to load iron ore in mid June and sail to Nantong. That charter brings the May tally to more than 30 Capesizes for BHP, compared with the nine it chartered for iron ore Pacific voyages in April.

The record breaking run has been underpinned by BHP Billiton’s move to secure as many cargoes of iron ore at premium spot rates, amid threats by Chinese mills to boycott rival Australian producer Rio Tinto.

According to brokers in Hong Kong, new records have been set on the route almost daily for the last two weeks and demand remains red hot. The brokers reported that the tonnage shortage is so acute that several June cargoes have had to be postponed.

Bloomberg reported that power station coal prices at Australia's Newcastle port jumped to a record on supply curbs. As per report shipments in the week ended May 26th 2008 fell by 18% from the week before and the queue of vessels to load rose by one to 39. Deliveries from Newcastle have been hampered by transport bottlenecks.

According to the globalCOAL NEWC Index, the weekly index for coal shipped from Newcastle surged AUD 13.35 or 9.6%to AUD 151.70 a tonne in the week ended May 30. The price has more than doubled from AUD 56.35 a ton a year earlier.

Mr Max Layton an analyst at Macquarie Bank Ltd said that “Thermal coal has had an amazing rally over the past few months. The supply side still looks like it's not enough so the market is remarkably tight and people have to pay a huge premium to get the available coal.''

Asia has led rising demand for coal. Indian power companies need to double coal imports to 40 million tonnes by 2012.

Bloomberg reported that India’s Vedanta Resources Plc was one of five companies named by Liberia as bidders for rights to exploit iron ore at the defunct Bong Mines.

Mr Eugene Shannon West African country's minister of land, mines and energy said that “The other bidders are BSGR Resources Ltd, China Union Investment Ltd and Beleh Resources Ltd.”

He said that “The investment into the Bong Mines is valued at USD 1.6 billion and the name of the successful bidder will be announced in about six weeks.”

According to Liberia's Ministry of Lands, Mines and Energy the country's eastern and western ore belts have deposits estimated at 600 million tones.

It is reported that Mr Zhang Gangfeng secretary general of Shanxi Coking Industry Association while speaking at a conference held by SXCIA last week urged members of the association to limit outputs in an attempt to stabilize market price.

Mr Gangfeng said that due to tight coking coal supply, EXW price for prime coking coal and rich coal reached record high of CNY 1800 to CNY 1850 per tonne in Shanxi's Linfen, Jinzhong, Yuncheng and so on last week. He added that “Members at the conference complained about scant supply, low quality and high price of coking coal. Besides, freight rates are increasing as Olympics approach. In the meanwhile downstream steelmakers are reluctant to accept current coke prices.”

Mr Zhang said members should limit outputs according to own conditions and try to stabilize prices for coke and coking products. He said that "We will jointly try to solve the common problems we face.”

All the small coal mines in Linfen, most of which are mainly engaged in coking coal, have suspended productions since the mine accident in Hongdong in 2007. Small mines in Jinzhong also have to hold off productions as Beijing Olympics loom. The remaining several major miners can hardly meet robust demand from downstream industries.

Shanxi Coking Coal Group, the dominant local supplier, has offered the most favorable price for large steelmakers. But price quoted by medium miners and coal cleaning plants posts a sharp uptrend. Traders almost adjust sales prices every day.

Bloomberg reported that Indonesia PT Bumi Resources Q1 profit jumped by 29% after prices of the fuel surged. Its net income in the three months ended March 31st 2008 climbed to USD 103.3 million as compared to USD 80.2 million. Sales gained by 15% to USD 663.6 million.

Bumi’s coal sales were at 12.5 million tonnes in the first three months of the year as compared with 14.5 million tonnes a year earlier.

It plans to boost sales by 13% to 61 million tonnes of coal this year. That's 1 million tonnes less than a forecast of 62 million tonnes provided by Mr Peter Ball vice president for marketing on February 26.

Platts reported that Peruvian miners are mulling a possible strike after lawmakers in that country rejected a proposed law that would have expanded the amount of company earnings that mine workers can share.

As per report representatives of the country's biggest mining union, the National Mining Federation met Friday to discuss a response to Congress's failure to pass the measure, although the lawmakers earlier in the week passed a companion law aimed at enhancing benefits for contract miners. Union members were to decide in a plenary session June 6th to 7th what course of action to take, including the possibility of a strike on June 16 and protests.

Mr Jesus del Castillo leader for northern Peru for the national federation said that "The situation is complex because the central government met its agreement and it was a left-oriented opposition party that voted Thursday night against changing a law that limits the share of company earnings that workers can get.”

He said that "The northern region is the one which would see the biggest impact from a law change as it has some of the country's richest mines including Newmont's Yanacocha and Barrick's Chicama in gold and Antamina for copper-zinc.” He added that current law, which miners wanted changed, limits miners to a lifetime maximum of 18 salaries of such benefits and the miners want to eliminate that cap.

Sources from the national mining society said that only about eight mines in Peru run the risk of paying miners more than the legal limit and are located mostly in the northern region. Sources added that the great majority of the some 150,000 miners in Peru will not be affected by the earnings cap.

Mr Del Castillo said that it was the members of the left oriented Nationalist Party of Ollanta Humala who voted in block against the law. The bill had been controversial from the beginning as regional authorities are the ones who are now getting that excess revenue from miners.

Australia biggest producer of natural gas from coal seams, Origin Energy Ltd announced that it did not accept the revised acquisition proposal from BG Group plc. Origin said that the revised proposal does not adequately reflect its value of resources.

Origin Energy said that BG has increased the offer to AUD 15.50 per share cash proposal from the earlier offered AUD 14.70 per share. Origin also revealed that it was engaged with negotiations with BG and requested trading halt.

Mr Kevin McCann chairman of Origin said that "The board of Origin has given careful consideration to all of the relevant information available to it, particularly the substantial increase in the company's CSG resource base and the demonstrably higher value now placed on CSG resources"

Bloomberg reported that Ukraine's biggest coal producer Donbass Fuel and Energy Co may acquire a mine in Russia's Rostov region.

As per report Donbass is considering buying the Chiha mine, which contains about 50 million tonnes of coal. But it didn't identify the mine's current owner.

The report added that Donbass which controls 25% of the Ukrainian coal market raised USD 150 million from Barclays Capital and Standard Bank Plc in its first syndicated loan on May 19 to finance expansion.

Joy Global Inc, a worldwide leader in high productivity mining solutions, said that it continues to benefit from unprecedented demand for its underground and surface mining equipment in response to the strong demand for coal, copper, iron ore and oil sands. All of these major commodity markets that the Company serves have extremely thin supply surpluses or most often, significant supply deficits, as commodity supply increases to date have been unable to match commodity demand growth.

Joy Global said that “In thermal coal markets, stockpiles at power generators remain at extremely low levels, and the rebuilding of inventories will add to the supply deficit. The Company believes the gap between coal demand and supply could reach 60 to 100 million tons this year. Industry forecasters expect steel demand to continue growing at 5% to 6%, led by growth of 10% in China demand. Both metallurgical coal and iron ore remain in significant deficit, and some projections indicate that steel supply could be 20 to 30 million tons less than demand this year due to shortages of raw materials.”

It added that “The US has become the swing supplier to the international thermal and metallurgical coal markets and export demand and prices are redefining the domestic market. Due to the renewed strength of this market, the Company's strongest growth in its second quarter original equipment orders was generated in North America for both surface and underground equipment. Copper suppliers have not been able to produce surplus to date and announced major expansion projects will add no more than projected demand growth over the next four to five years. The expected return of U.S. copper demand over this period will add pressure to supplies. The Company also expects oil sands growth to continue as the major oil companies more aggressively seek additional and unconventional sources of oil.”

It believes that commodity demand will continue to grow, led by the growth from the emerging markets in general, and from China and India in particular, as these countries continue to industrialize. Based on the status of existing expansion projects and industry projections, the Company expects that the commodity markets will generally remain in supply deficit for the next three to five years or longer. The Company believes that its customers will require significant additional capital expenditures to add and accelerate mine expansion projects to enable supply to catch up with demand and ultimately will require a higher sustaining level of capital expenditures to be able to keep up with expected long-term commodity demand growth. The rapid and unprecedented escalation in commodity prices within the last year suggests that this outlook is generally held both by the customers that use the Company's equipment and by consumers of the commodities that the Company's equipment mines.

Gide Loyrette Nouel announced that it has advised China National Machinery & Equipment Import & Export Corporation in Gabon in connection with the development of the Bélinga iron ore mine, which ore reserves would exceed 560 million tonnes with 64% iron ore content.

Gide Loyrette Nouel assisted China National Machinery & Equipment Import & Export in drafting and negotiating a mining convention which was signed between the Republic of Gabon and Compagnie Minière de Bélinga on May 24th 2008 in Libreville.

Shareholders of Compagnie Minière de Bélinga include the Republic of Gabon (25%), China National Machinery & Equipment Import & Export, Panzhihua Iron & Steel Group and other individual shareholders. The mining convention provides for the construction of major infrastructures in Gabon such as a 3 x 50MW hydroelectric plant and 560 kilometer railroad and deep sea harbor facilities. Construction and development of the mine should last approximately four years and CMEC anticipates investing USD 5 billion in this project. Output of the mine is expected to reach 20 to 30 million tonnes per year.

China National Machinery & Equipment Import & Export retained the Mining, Oil & Gas Practice Group of Gide Loyrette Nouel to provide the legal assistance necessary to implement the project, including the drafting and negotiation of the articles of association of Compagnie Minière de Bélinga, the mining convention as well as the engineering, procurement and construction contracts, operation and maintenance contracts and off-take contracts.

Gide Loyrette Nouel dedicated four lawyers of its Mining, Oil & Gas Practice Group to the Bélinga project, including Partner François Krotoff, and Associates Simon Cudennec and Véronique Bourg in Paris and Nicolas Bonnefoy in London, together with the assistance of its Beijing office.

Gide Loyrette Nouel is one of the leading international law firms. It has 21 offices around the world. With 700 lawyers and legal consultants, including 106 partners, drawn from over 30 nationalities, the Firm provides specialist quality legal services in the most complex areas of national and international finance and business law.

It is reported that the Donimalai Iron Ore Mines situated in Bellary District of Karnataka State is one of the major projects of NMDC.

NMDC as part of its intensive CSR activities has been undertaking various developmental activities in the region. It has been actively contributing in the areas of health & medicare, education, drinking water facilities, infrastructural developments, etc., for improving the quality of life in the villages of Narasingapura, Bhujanganagar, Donimalai, Kammathur, Navallete, Ranjitpura etc.

Akshaya Patra's ideals and work impressed NMDC to partner in providing nutritious, hygienically cooked noon meals to the less privileged children studying in Government Schools of Sandur Taluk in Bellary District. The Akshaya Patra Foundation has been selected by M/s NMDC Limited a navaratna PSU to do its mite for mitigating hunger & illiteracy in one of the most backward areas of Karnataka.

NMDC has donated two custom built food distribution vehicles costing INR 2.835 million and an amount of INR 2.533 million towards feeding cost for 2008-09 of 2,150 children in the Government Schools of Sandur Taluk in Bellary District. The program was launched & the vehicles were flagged off in February 2008. With NMDC's support, Akshaya Patra has now been able to increase its reach to more schools in a bigger region and include more children in the free meal plan. Currently the foundation is feeding over 70,000 numbers of school children in Bellary district.

NMDC is sponsoring various development works in the area as required by local authorities such as establishment of Bellary district science centre, providing infrastructure facility to hospitals, schools, colleges and for other social cultural activities.

Czech coal miner New World Resources said that its net profit jumped 339% in the first quarter, on a 64% rise in revenue which was fuelled by soaring coal prices.

NWR said that net profit was EUR 117.8 million in the January to March 2008 period up from EUR 26.8 million a year ago. Revenue rose to EUR 523.9 million from EUR 319.5 million in the same period of 2007. Earnings before interest, tax, depreciation and amortization were up by 130% at EUR 211.5 million.

NWR said that for coal and for most of the coke price, negotiations were concluded at record prices for this year. It also said it opted to finance the first phase of its EUR 315 million investment program from cash owing to poor credit market conditions.

NWR is the full owner of Czech group OKD, which mines coking and steam coal in the east of the Czech Republic. It plans to develop two mines in Poland, across the border from its Czech operations.

BL reported that an increase in railway freight charge for iron ore cargo and the closure of minor ports such as Belekeri and Karwar during the monsoon season seem to have made an impact on the road infrastructure in Mangalore.

These days, more number of iron ore laden lorries are thronging the national highway no 17 adjoining the New Mangalore port.

Sources in the port agree that the number of iron ore laden lorries has more than doubled in the past few weeks.

The number of iron ore laden lorries to the port, which stood at around 800 lorries a day on April 3rd 2008, went up to more than 1,700 on May 27th 2008.

As a result of this, iron ore cargoes from these ports are being diverted to the New Mangalore port through road. It is learnt that the Chairman and the Deputy Chairman of the New Mangalore ort Trust convened a meeting of port users and all others concerned on Friday to find a solution to regulate the movement of iron ore laden lorries to New Mangalore.

Mining Weekly reported that large diesel generator sets are being brought from Australia to BHP Billiton's Hotazel manganese mines in South Africa to keep critical sections operative should power outages occur.

Mr Peter Beaven president of BHP Billiton manganese told Mining Weekly Online that earlier this year, power issues forced the company to call a force majeure.

He said that some 3 million tonne of manganese ore are being produced a year at the company's Hotazel mines, 2 million tonnes of which are railed to Port Elizabeth and Durban ports for export and the balance transported to BHP Billiton's manganese beneficiation plants at Metalloys in Meyerton which produces 780,000 tonne per year of manganese alloy and MMC in Nelspruit which produces 25,000 tonne per year of value added product.

Hotazel output has risen from 2.6 million tonnes in 2006, with South Africa's State owned rail enterprise Transnet allocating greater capacity and the Durban port assisting.

Mr Beaven added that “Rail reliability is improving and we have definitely passed over some sort of hump and I am a lot happier about Transnet this year than I was last year and there is probably more improvement to come."

He added that "Hopefully we will come up with an ideal situation for South Africa in the medium-term expanding Port Elizabeth to its maximum capacity and in the longer term, arriving at whatever has to be done, should Port Elizabeth no longer be used.”

It is reported that with hundred of coal transporters of the Central Coalfields Ltd on strike for the last two days, the possibility of major areas in north India plugging into darkness is not ruled out if the deadlock is continues for the next few days.

The transportation and dispatch of coal from the different mines of the CCL has come to the grinding halt. It has not only resulted in the huge financial losses to CIL but also affected the coal supply to the Badarpur Thermal Power Station, Punjab State Electricity Board, NTPC, DVC and RVNL in Uttar Pradesh big way.

Mr SK Singh DGM of CCL told media that “Almost 80 to 90% of the coal supplied to these power stations is from the CCL.”

Sources said that with the coal supply to the power station being hit the Ministry of the Coal has directed the CCL management to take all steps to end the deadlock.

Pittsburgh Post reported that the public comment period and hearing on US Steel Corp's proposed USD 1 billion upgrade of its coking facility in Clairton have been extended by two weeks to June 19.

The public hearing date and the end date for the comment period, which began May 7th 2008 had been June 5th 2008.

The Allegheny County Health Department announced the two week extension in response to requests for a 30 day extension by environmental and citizens' groups that said they needed more time to review the lengthy and complex permit application.

The coke oven installation permit would allow US Steel to build the first of two proposed new coke oven batteries and install pollution controls at the largest coke-making facility in the United States. The first new battery is scheduled to begin operation by December 2011.

The new public hearing is scheduled for June 19th 2008 in the Clairton.

HudBay Minerals Inc said that a miner died at its St Lawrence Zinc operation at Balmat in New York on Saturday due to falling rocks.

HudBay Minerals said that the isolated rock fall in an active mining area resulted in the death of miner Mr Willard Paul Clewis Jr.

HudBay said that the accident is being investigated by officials from the Mine Safety and Health Administration. It is also co operating fully with the MSHA investigation and conducting an internal investigation.

ET reported that that Indian government is believed to have decided to impose 15% export duty on iron ore used for making steel, which has seen a 50% increase in prices since January, thereby fuelling inflation.

A highly placed source said that the decision was taken at the meeting of the Committee of Secretaries on May 30th 2008. The CoS has also decided to roll back export duty on steel, barring primary and semi finished products, in return for the INR 4,000 per tonne reduction in prices announced by them early last month.

At present, an export duty at a specific rate of INR 300 per tonne is imposed on iron ore with 62% of higher iron content and INR 50 per tonne on lower grade ore. Under the new dispensation, the export duty would be based on the value of the product shipped abroad.

An official said that “Decisions on both roll back of export duty on steel and imposition of the same on its raw material are expected to announced in the next few days. The Department of Revenue will notify the decision once the CoS minutes are issued.”

Steel makers and iron ore producers have been at loggerheads over export of the raw material. Steel makers have been demanding restrictions on raw material export while iron ore producers, helped by a section in the government, had contended that the ore meant for exports was of no use to Indian steel-makers.

Fox Resources Ltd has identified three new iron ore prospects near its Mt Oscar iron ore project in the Pilbara region of Western Australia.

The new prospects, Mt Carla, Mt Kristie and Mt Catherine are located within the Cleaverville geological formation.

Surface mapping, rock chip sampling and density/gravity surveys are expected to be undertaken in the September quarter.

The Courier Mail reported Queensland state will increase coal royalty payments on mining companies to help it avoid running a budget deficit.

The newspaper citing Mr Andrew Fraser treasurer as saying that the government will raise an extra AUD 579 million in 2008-09.

Mr Fraser said that coal is fetching record prices and Queenslanders deserve their fair share of the profits. He said that "When you have got a resources boom on, one of the issues that you confront is a need to spend more on infrastructure, to spend more on services, to spend more to accommodate the growth that's occurring.”

The paper said that under the system, miners will have to pay 10% on any coal sold at AUD 100 per metric tonne or more compared with the existing 7%. The plan will be included in the state budget tomorrow.

JMB reported that Japanese integrated steel makers and miners failed to compromise on price of semi soft coking coal for fiscal 2008 started April.

As per report Japanese steels reject 300% hike offered by miners citing less tight supply than hard coking coal and the quality. It said that Japanese steels could take more time to settle price for lower grade coking coal, which represents around 30% of the iron making coal, while the steels almost finished the price negotiation for hard coking coal and pulverized coal injection coal.

Reuters reported that Indonesia's energy ministry is considering asking coal producers to pay for royalties using coal supplies instead of cash in a bid to secure stocks for domestic stocks.

Mr Simon Sembiring director general of minerals coal and geothermal at the energy ministry at the Coaltrans conference said that "The government is thinking of helping PT PLN by asking for coal supplies instead of cash. We can then sell part of this coal to PLN at a lower price that's the idea."

Investor Daily reported that Indonesia's biggest seller of heavy equipment PT United Tractors may buy a coal mining company in Kalimantan this year for as much as USD 200 million.

Mr Djoko Pranoto president of PT United Tractors said that we will use debts for the acquisition. But he didn't elaborate.

Reuters Cited Mr Sun Xinguo CEO of CITIC as saying that CITIC Resources Holdings Ltd has not decided what to do with its 17.66% stake in Australia's Macarthur Coal and could equally sell or hold the stake.

Mr Sun told a news conference that "We haven't made a final decision about what to do next. We will decide at a proper time."

Macarthur's top shareholder, Mr Ken Talbot has been selling down his stake of around 24%, opening up the possibility of a takeover bid by CITIC Resources or ArcelorMittal which bought almost 15% in the firm last month for AUD 604 million.

Macarthur supplies steelmakers with more than one third of the world's pulverized coal, making it an attractive target at a time when steel prices are red hot, driven up by demand from China.

Strike Resources has exercised its option to buy a 38.5% interest in Apurimac Ferrum, the owner of the Cuzco and Apurimac iron ore projects in Peru for USD 34.5 million.

Strike has now taken its total economic interest to 68.15%

Russian media reported on Sunday that rescue teams found three Russian miners dead, hours after one worker was unearthed alive, while another two were still trapped in a Siberian coal pit two days after a cave in.

The accident occurred on Friday at the Lenin mine in the Kemerovo region which holds the giant Kuzbass coal basin. Seventeen people were trapped underground after the cave-in at a depth of 400 metres, but 11 of them escaped to safety.

RIA news agency quoted Mr Andrei Malakhov deputy Kemerovo Governor as saying that "The number of the dead in the accident stands at three. Works are underway to recover the bodies."

Bloomberg reported that Newmont Mining Corp and Indonesia begin arbitration in December to settle a dispute over the government's demand that the US company sell part of a copper mine to local investors or lose its operating contract.

Mr Simon Sembiring director general of coal and mineral resources said that the government and Newmont have agreed on their representatives and a third member to chair the process.

As per report Indonesia issued a default notice on February 11, saying that Newmont hadn't sold a stake in the Batu Hijau mine according to an agreed schedule. Newmont, the operator of the nation's second largest copper mine, disputed the claim. A cancellation of the contract to mine the deposit in Sumbawa island may undermine overseas investors' confidence in the metals rich country.

Mr Sembiring said that “The court proceedings will start in December in Jakarta. The arbitration will follow rules based on the United Nations Commission on International Trade Law.”

According to a 1986 contract, Newmont and other overseas investors must cut their combined stake in PT Newmont Nusa Tenggara to 49% over time. A deadline to sell a 10% stake expired on March 3 and Newmont hasn't abided by its contract.

Newmont owns 45% of Newmont Nusa Tenggara, which operates the Batu Hijau mine. Japanese investors including Sumitomo Corp control 35% and Indonesian businesses hold the remainder. The mine made up as much as 20% of Newmont's USD 5.5 billion 2007 sales.