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JULY 2008 |
From the CEO's Desk | |
Dear Readers, D.A.Chandekar |
Qingdao Global Specialised Belting Supplies Co. Ltd. Premium Energy Transmission Ltd. Batliboi Environmental Eng. Ltd. The Indian Institute of Metals |
Steel companies in Direct Sales to Consumers Reeling under government's pressure to hold prices, steel firms have started selling products directly to small buyers to help save costs, as part of their commitment to keep prices down and stave off inflationary pressures. While steelmakers themselves would be unaffected by the move, small and medium enterprises (SMEs) who have been forced to buy through middlemen because of the smaller size of orders may save between 20 - 25 per cent of their costs, traders said. About 5 per cent of hot-rolled products are marketed through retailers who buy from the steel companies at the same price as major buyers and sell it to SME consumers at a marked-up price. The middlemen would thus, be ignored thereby benefiting the ultimate consumers to procure steel at right price, said an industry official. Steel firms promised to take steps to fight inflation redently including reviewing trading arrangements and setting a maximum retail price, reports said. The government had also suggested to advertise the price through internet to facilitate consumers know the right price. JSW Steel Ltd, India's third biggest producer, said recently that it would make up to 10 tonnes steel available to actual users through its warehouses across India. Ispat Industries Ltd, which supplies around 90 per cent of its output directly to re-rollers such as Bhushan Steel and Uttam Galva Steels, recently started direct marketing to the SMEs. Prices of steel, used in construction, auto parts, engineering goods and heavy equipment, have risen by a third in India and doubled globally. Tata Steel Ltd, world's sixth biggest producer, sells only 20-25 per cent to retailers and has no plans for direct retail sales. |
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KIOCL chalks out Rs 110 crore investment plan The public sector Kudremukh Iron Ore Company Ltd (KIOCL), the 100 per cent export-oriented unit, is embarking on a Rs 110-crore modernisation project to meet its export commitments by achieving full capacity utilisation at its Mangalore pellet plant, sources said. The plant had been dogged by raw material shortage after its captive mines were shut in 2006. Of the proposed investment, Rs 40 crore will be used for the upgrade of the machinery and Rs 70 crore to mechanise handling of raw material. The mini-ratna company, which is profitable, also plans to set up a railway siding from its pellet plant to the nearby railway station at Tokur for bringing raw materials. The company has acquired around 53 acres from the Karnataka Industrial Areas Development Board for laying railway siding. It intends to set up a tubular conveyor to transfer the raw material from the railway station to the pellet plant. This is expected to help the firm save a lot result in a lot of savings for the company. The company is in the process of upgrading key machinery at its existing pellet plant to process even inferior quality ore and extract higher iron contents. The modernisation will enable it to operate the plant at its full capacity of 3.5 million tonnes per annum and increase exports as well. Following the closure of its captive iron ore mines at Kudremukh in Chikmagalur district, about 110 km from Mangalore, in compliance with the Supreme Court order, the company is sourcing 1 million tonne iron ore from Bailadila in Chhattisgarh and 1.5 million tonne from Donimalai in Bellary district of Karnataka. The new machinery will enable the plant to blend Bailadila ore, which has 66 per cent ferric content, with Donimalai ore having 63 per cent ferric content to manufacture high-quality pellets for the Chinese market. The company is importing these pressure filters from Sweden. To begin with, KIOCL plans to install 3 pressure filters this year and another 6 filters in the next year in three phases for Rs 40 crore. As against 18 vacuum filters, 9 pressure filters will be sufficient to process the raw material. |
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Bhilai Steel records best Ever Quarterly output Bhilai Steel Plant (BSP), an arm of the public sector Steel Authority of India Limited (SAIL), has ended the first quarter of fiscal 2008-09 with best-ever production of finished rail, merchant rounds and bars, total merchant products, wire rods and total finished steel. The company had witnessed a record production in the financial year 2007-08. Growth in the last financial year was matched by an equally good performance in quality and value-added steel production. The strategy has been to translate market demand into opportunities and increase the share of BSP in the domestic market. The cumulative production of high tensile plates for home sales, total high tensile plates, electrode quality wire rods, TMT wire rods, TMT bars and Total TMT bars and rods in April – June 2008 have surpassed all previous records. In 2007-08, BSP had recorded a 98.3 per cent growth in the production of TMT bars and 152.7 per cent growth in TMT wire rods production. The Fe 500 grade of TMT that BSP is producing in both the merchant & wire rod mills is now being made available to the customer with earthquake-resistant (EQR) properties, claimed sources. In fact, the Merchant Mill has exceeded its Q1 annual business plan target of 124000 tonnes by producing 147000 tonnes to meet more orders for its TMT-HCR (high corrosion-resistant grade) and TMT-EQR in Fe 500 grade. In the last month of the quarter, June 2008, production of rimming heats at SMS-1 and electrode quality wire rods was the highest for any month since inception. Converter A continues to be operative with 7582 heats on lining, which is the highest till date in all SAIL Plants. In the area of techno-economics, Blast Furnace productivity for the first quarter has also been the best for any April-June period since inception at 1.748 tonne/cubic metre/day. Blast Furnace productivity in June 2008 at 1.803 is also the best ever for the month. |
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The privately owned steel major Essar Steel has faced three setbacks in recent times. The company has lost the race for the American steel firm, Esmark, to Russian metals giant, Severestal, followed by the group losing its bid for a 50 per cent stake in Kenyan oil refinery to Libyan oil firm, Tamoil, and Lakshmi Niwas Mittal's ArcelorMittal pipped it in taking over the Bulgarian firm, Kremikovtzi from Pramod Mittal. Now, the company is looking ahead at other acquisition proposals. After creating a strong group of companies in India, the group started looking out and made aggressive acquisitions abroad in the last five years. This included buying Business Process Outsourcing major, Aegis; Algoma Steel in Canada, and Minnesota Steel in the United States. The group is also investing in a steel mill in Trinidad, oil exploration blocks in Nigeria, Madagascar and Vietnam. In wireless telephony too, the Ruias are looking to increase their presence abroad and have invested in a GSM telephony network in Kenya. Ruia, a good-food aficionado, is now busy charting out a $20-billion investment in various projects across the world, including India. The group is setting up new steel mills in Orissa, and increasing capacity in its Hazira plant from nine million tonnes to 25 million tonnes. The focus is certainly on international operations too. In the last one year, the group increased its overall steel production capacity of nine million tons per annum to 25 million tons per annum. It achieved this by, among others, raising the capacity at Algoma, Canada from 2.4 million tons per annum to four million tons per annum and is investing another $500 million in the plant. Though the Essar group has received a series of setbacks in international acquisitions, there is some room to cheer. The group took home a cheque of Rs 200 crore as consolation prize from Esmark as break-up fees, and the un-listed Algoma is valued at $5 billion, up from $1.5 billion it was worth when the Ruias took it over. Meanwhile, Essar Steel has been compensated with $45.3 million (Rs 200 crore) for withdrawing its bid for US steel maker Esmark. Russian metal giant Severstal, the successful suitor, paid the Indian company $25 million as a termination fee and a loan cancellation charge of $20.3 million. |
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Steel prices to remain stable beyond July The domestic steel producers have reiterated that they would help government by extending the price holding deadline beyond July which they committed in May to tame inflation, sources said. This was decided by the industry officials in the recent meeting with government officials. The meeting was called by Steel Secretary R S Pandey to discuss the recent increase in prices of steel tubes and pipes despite a freeze on hot-rolled coil (HRC) prices, the main input. Prices have gone up only for 5 per cent of the items, which are sold to traders. Nearly 95 per cent of steel is supplied directly to the consumers. Steel tubes and pipes are now selling at Rs 53,000 a tonne. Steel along with iron has a weight of 3.64 per cent in the wholesale price index (WPI). The WPI-based inflation for the week ended June 14 had touched a 13-year high of 11.42 per cent. Flat steel product prices have jumped 17-24 per cent since April last year, while long products such as bars and rounds have appreciated 50-60 per cent over the same period. The producers also assured the government to reduce the direct and indirect export of HRC to ensure adequate domestic availability. It will have an impact on prices of cold-rolled coils and galvanised sheets as well. A maximum retail price will be made effective so that no trader or stockist takes advantage of a supply shortage. Companies will display these prices on their websites and also advertise them through newspapers so that the limit would not be breached at all. According to ministry's data, steel export in the first quarter of the current year was 900,000 tonnes, over 30 per cent lower than the 1.3 million tonnes exported in the corresponding quarter last year. About 5 million tonnes of additional steel would be available in the market this year. New capacities to the tune of 3 million tonnes will become operational, while another 1.5-2 million tonnes would be available as a result of lower export. |
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ArcelorMittal enhances its distribution activities in United Arab Emirates
ArcelorMittal announced that it intends to
acquire 60% of the entire issued share capital of DSTC FZCO, a newly
incorporated company located in the Dubai free zone.DSTC LLC is a
Dubai-based privately owned entity, founded in 1986, which currently
employs 50 personnel. It sells principally to the construction market,
which represents more than 50% of its activity. DSTC LLC's distributes
approximately 120,000 tonnes of products per year. In 2007 its revenues
were about EUR 70 million. |
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LISCO unveils USD 119 million CAPEX plan
Arab Steel reported that Libyan Iron & Steel
Company has made 7 contracts worth USD 119 million to upgrade the
company's mill. These contracts have been concluded with several world
companies from Italy, China, Turkey and Bosnia, out of which the Italian
companies have taken the biggest share of the value. These contracts
include construction of a station for separation of gases and compressed
air. This contract has been concluded with the Chinese company Catic for
the supply of machinery and equipment and with two Italian companies,
Fritti and Tecnomontagi for the civil and various erection works. |
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Flat steel import price levels for Turkey Ukraine's Ilyich Iron & Steel Works was quoting USD 1,200 per tonne CFR on hot rolled coils to Turkey, with late July or August 2008 shipments.Another mill Zaporizhstal Iron & Steel in Ukraine was offering USD 1,260 per tonne CFR and USD 1,200 per tonne CFR for cold rolled and hot rolled coils to Turkey, increased by USD 110 per tonne and USD 120 per tonne, respectively. Russia's Severstal was offering USD 1,245 per tonne CFR for hot rolled coil and USD 1,300 per tonne CFR for cold rolled coil. |
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Qatar Inflation to stay around 13.75% in 2008 According to Mr Sheikh Abdullah Bin Saud al Thani governor of Qatar central bank, Qatari inflation is likely to stay about 13.75% in 2008 as food and oil prices remain high. He added that "Due to agricultural and commodity prices, it will stay around the same level of 13.75%." Qatar's inflation, which accelerated to a record 14.8% in the first quarter, is the highest among the six GCC states, including Saudi Arabia and the United Arab Emirates. Inflation has risen across the region as oil fueled economic growth created shortages of real estate and services and the weaker dollar made imports more expensive. Qatar Central Bank said that M2 money supply growth, an indicator of future inflation, accelerated to an annual 53% in March 2008 from 33% in December 2007. Qatar has taken a number of measures, including raising the bank reserves requirement, in an attempt to slow money supply growth and inflation. |
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Iran inks MoU with Serbia to boost transportation
Iran and Serbia have signed a MoU on
goods and passenger transportation. The MOU was signed between Mr Mohammad
Bokharai Iranian deputy minister of roads & transport and Mr Miodrag Jocic
Serbian deputy minister of transport & communications. |
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UASC place order for 9 ships with Samsung Heavy
United Arab Shipping Company has announced
that the signing of a new building contract for nine 13,100 TEUS ships
with Samsung Heavy Industries. The contract constitutes the biggest
containership new building order ever placed by a GCC owned company and is
valued in excess of USD 1.5 billion. As per report, the first of the 9th
sisters will be delivered to UASC in October of 2010 and the rest will
follow in short order with the last vessel being delivered in the 4th
Quarter of 2011. |
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Oman to invite biding for 2 key Construction contracts
Oman Daily Observer reported that
development of a world class airport in Sohar is expected to begin in
earnest with authorities inviting qualified international and local firms
to bid for two key construction contracts linked to the project. The
report added that one contract involves site preparation works and the
other entails the provision of complete airfield infrastructure
facilities. Actual construction work on the project, which is being
overseen by the Ministry of Transport and Communications, is expected to
commence before the end of this year, or early in 2009. |
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BHP Billiton seeks new iron ore projects in Brazil World No. 3 iron ore producer BHP Billiton is now studying a number of opportunities to develop some iron ore mines in Brazil. A senior source in the company tells the group's only Brazilian production currently is its 50% interest in pellet producer Samarco. Vale do Rio Doce owns the other 50%. However, the official says BHPB now has intentions of acquiring or developing new deposits in Brazil, though he did not specify where these are located nor how close a deal could be. BHPB's takeover target Rio Tinto operates an iron ore mine at Corumbá in southwestern Brazil which it is planning to expand. |
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Australia iron ore exports up in first 4 months Australia exported 98,179 tons of iron ore in the first 4 months, increased by 19.8 percent compared to the same period of last year. China, the chief destination for Australian iron ore, imported 56,264 tons of iron ore from Australia, up by yearon- year 29.8 percent. Japan ranked the second with 25,638 tons, increased by 7.3 percent compared to the same period of last year. South Korea increased their intake by 12.4 percent to 10,279 tons in the same comparison. |
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Krakatau Steel aims to improve quality and yield of slab Indonesia's PT Krakatau Steel (PTKS) is committed to investing $200m in its 2m tonnes/year steelworks in Cilegon, West Java, by end-2010, company president director Fazwar Bujang tells. Part of this amount will be raised by proceeds of a proposed Initial Public Offering of shares and the remainder by bank loans from overseas financial institutions. PTKS is currently inviting suppliers to tender for an upgrading and modernisation programme for one of its two slab plants. In addition to improvement in productivity and steel quality, lowered production costs and achieving higher efficiencies, the slab plant is expected to improve output to 1.2-1.4m t/y from the existing capacity of 1m t/y, Fazwar tells. PTKS wants to produce more slab in order to reduce slab imports that currently average 400,000 t/y. It recently assigned SMS Demag to upgrade its hot strip mill which will see its HRC capacity expanded from 2m t/y to 2.4m t/y. Meanwhile, the Indonesian government is supporting the proposal for PT Krakatau Steel to be privatised by an IPO, Fazwar tells. “It will be a matter of time” that the parliament will give its approval for the Indonesian steel mill to proceed with the share flotation, Fazwar says, adding that the listing is likely to take place by November this year. It is understood that 20% of the steel company may be offered. |
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Indonesian plan to restrict tin production may affect global market Indonesia's plan to
restrict its tin production, if realized, will have an impact on the
global tin market as research conducted by many institutions has shown
global tin production is lower than demand, a tin mining executive said.
“We still do not know what the impact will be on PT Timah Tbk`s
performance, if the government restricts the country`s tin production
starting in 2009,” Abrun Abubakar, corporate secretary of publicly-listed
tin mining company PT Timah Tbk, said. “Neither do we know what PT Timah`s
prodution ceiling will be. As far as we know, a regulation restricting
Indonesia`s tin production has not yet been issued,” he said. The
government is expected to restrict the country's tin production starting
in 2009 to control global tin prices Indonesia is the world's biggest tin
exporter and second |
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Advanced coke oven begins operations at Nippon Steel plant An advanced coke oven went into operations at a Nippon Steel Corp plant in Oita this month. The test oven, which uses more lower-quality, cheaper coal than conventional ovens, can reduce carbon dioxide emissions by 400,000 tons a year. It is the first oven to use advanced technology developed jointly with rival steelmakers under the initiative of the Economy, Trade and Industry Ministry. The 37-billion-yen oven can produce about one million tons of coke a year. It is scheduled to begin full operations in January 2010. Nippon Steel plans to provide rivals with technical assistance to put the new technology on about 50 ovens industry wide in Japan. |
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Korean steel capacity to reach 70m t by 2010 Expansions to steelmaking capacities at four Korean steelworks over the coming two years will push the country's total capacity to 70.53m tonnes/year, an increase of over 10m t/y from current levels. This was the result of an informal survey conducted recently by the Korea Iron & Steel Association (Kosa). In April, the association predicted that installed capacity will reach a record 59.82m t this year, up from 57.23m t in 2007. Over the next two years, Posco will add another 4m t/y to its capacity – 2m t/y each at its Pohang and Gwangyang works – to lift its total capacity to over 35m t/y, Kosa notes. By 2010 Hyundai Steel should have the first blast furnace at its Dangjin works commissioned. Hyundai's integrated complex will be built in three stages of 4m t/y each. Also, re-roller Dongbu Steel is taking its first step upstream, building a 2.5m t/y EAF-based facility adjacent to its CR and coated mills also in Dangjin. And Posco Specialty Steel (the Posco subsidiary and former Changwon Specialty Steel) is adding 200,000 t/y to its melting operations to lift its total capacity to 1.16m t/y. Kosa completed the study to coincide with the Korean steel industry's Iron Day on 9 June, marked to commemorate the day in 1973 that Posco tapped the first iron from its No.1 blast furnace at Pohang. |
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Vale eyes Malaysia for $1 bln pellet plant Brazil's Vale favours
Malaysia for a $1 billion Southeast Asian iron ore pelletizing project, a
company official said. “We've been looking at a lot of options in
Southeast Asia ... Vietnam, Thailand, Malaysia, but Malaysia has more
development options,” Renato Hendriksen, marketing manager for Vale, said
on the sidelines of the Steel Outlook 2008 conference in Singapore. “We
are looking of course for political and economic stability, but I think
the main issue is a deep-sea port ... natural gas, though not that much,
and all the government and financial (systems).” He added that Vietnam and
Thailand had not yet been ruled out. “But discussions are more advanced in
Malaysia. If things move well, we could make a decision within the next
two years, then maybe one year more for construction.” Hendriksen said the
plant would have a minimum capacity of 7 million tonnes and would supply
steel mills in Malaysia and Indonesia and further afield in Asia. “We will
sell locally for sure, we can even reach the coast of India they really
need pellets there. We can send to our colleagues in Japan, southern
China, Korea all those countries. He said the project would also include a
deepwater port that could take some of the new breed of Very Large Ore
Carriers (VLOC) with tonnages of around 400,000 tonnes. Hendriksen said
Vale would commission its own VLOC fleet and hoped to have these vessels
after 2013. Currently, Vale uses Capesize vessels with capacities of
100,000-180,000 tonnes to move bulky iron ore around the world. “We really
need to improve. It's all about the freight market. It's tough for us who
sell and it's tough for customers.” The Baltic Exchange's capesize freight
index, which monitors costs for classes of merchant ships typically
hauling 150,000-tonne cargoes, is at 19,253 points, just off a record
19,687 hit on June 5. Those high freight rates make Australian iron ore
comparatively cheaper than material from Brazil for buyers in Asia, and
Australian miners are seeking higher prices to reflect the reduced freight
cost.
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Benxi Steel unveils CNY 6 billion CAPEX
Benxi Iron & Steel Group will invest a total of CNY 5.99 billion
in technology improvement of over twenty projects, including alterations
in slab caster, first phase construction of super thin CR sheet and 3#
heating furnace and relocation of blast furnace. Among the total fund, CNY
5.2 billion will be put into items which have not yet been finished last
year and CNY 760 million will go to newly commenced projects which
required another CNY 30 million for its preparation work. |
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Hubei's Largest Scrap Steel Processing base Locates in Dongxihu District Wuhan Asia Iron and Steel Company and the office of Dongxihu District signed an agreement for building a largest scrap and scrap metal processing base. As per reports, the project covers an area of 174 acres and the total investment is CNY 217 million and will be mainly in production, processing, sales, distribution of all kinds of scrap, scrap metal et. |
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Chenggang exported 39,000 tonnes of steels in May
Tanggang Group Chenggang Company totally exported 39,000 tonnes
of steel products in May and sold at an average price of CNY 6800 per
tonne creating the highest monthly level.Along with approaching Olympics,
the nearest and largest selling market of Chenggang. Beijing market tends
to be weak, which posed some impacts to its steel sales. Therefore, it
started to turn to international market that has a robust market demand
and rising prices so as to market shares. |
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Hebei Steel Group officially established According to Hebei
Province's state owned asset supervision and administrative commission,
Hebei Steel Group has officially established on Jun 30th marking birth of
another 30 million tonnes grade steel company in China. The new group has
registered in Shijiazhuang with CNY 20 billion following a series of
mergers and acquisitions like between Angang and Bengang, Baosteel with
Guangzhou Steel, Shaoguan Steel, Wuhan Steel with Liuzhou Steel and
incorporation of Shandong Steel Group in the recent period. |
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ArcelorMittal to provide H beam production technology to China Oriental China Securities Journal
reported that ArcelorMittal is set to help China Oriental Group in H beam
production by providing QST technology.According to the report, regional
CEO of ArcelorMittal meant to do something to prove cooperation with China
Oriental which can be successful, as they've just started to work
together. |
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Tiantie Group H1 crude steel output up by 29.68% YoY Tianjin Tiantie Steel Group produced 2.51 million tonnes of crude steel in H1 of 2008 up by 29.68% YoY, 2.39 million tonnes of pig iron up by 29.33% YoY and 1.89 million tonnes up by 68.48%.It also posted sales revenue of CNY 27.4 billion and profit of CNY 391 million in H1 of 2008 up by 101% YoY and 25%YoY respectively.As per report, the mill's CR sheet project was put into formal operation on June 10th 2008 and that the second stage project is also under construction. |
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Steel Project to Boost Development of Economy in Jiujiang It is reported that Jiujiang Steel, which is the subsidiary company under Pinggang, is now developing with an investment of over CNY 200 million each month. It is expected that annual production value could be CNY 11 billion after the completion of II phase project in Jiujiang Steel in 2010 and tax could be CNY 650million per year. The 2nd phase technology alteration project in Pinggang cost CNY 7.5billion and started on October 2007 including 1.2 million tonnes wire project, 1.8 million tonne sheet project and Jiujiang Steel special dock project.As per report, sales income in Jiujiang Steel in 2007 was CNY 2.1billion up by 400% YoY while tax was CNY 110million up by 329% YoY. |
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Railway siding to save huge Transportation cost for Dazhou Steel It is reported that a 4.6 kilometer railway siding that is under construction by Sichuan Dazhou Iron & Steel Group Co Ltd will help reduce transportation cost of some CNY 60 million each year for the company after being completed.As per report, the project funded with a total of CNY 220 million, is directly linking the continuous casting plant of the steelmaker to the second line of Xiangfan-Chongqin railway line. Once finished, it can transport about 8 million tonnes of products annually. According to Mr Pu Chenglin the project commander with the heavy rail Development Company affiliated to Chengdu Railway Bureau, stated that the workers are working in three shifts trying to get the line run through by the end of this November. |
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Shougang to suspend steel production during 2008 Olympics It is reported that Shougang will cease steel production for the most part in Beijing during the 2008 Olympic Games and will then wind down its 8 million tonnes of capacity before the deadline of 2010.As per report, back to 2005 some heavy polluting enterprises including Shougang were listed in the catalogue of relocation plan by the government. Just in the same year, Shougang and Tangshan Steel jointly set up Shougang Jintang Corporation in Hebei province, namely the new Shougang. From then on, the moving of Shougang got afoot. The new established steel company has also caused 35 small severe polluting steelmakers in Hebei to be shut down equal to an annual capacity of 7.3 million tonnes. The move can reduce 18,000 tonnes of inhalant particles for Beijing each year, equal to 23% of the total volume of the city, and 23,000 tonnes of coal powder and 24,000 tonnes of sulfur dioxide for Tangshan district, Hebei province.
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Metals USA reports record Q2 result Metals USA
Holdings Corp announced record breaking results for the quarter ended June
30th 2008 which exceeded its previous record results posted in the second
quarter of 2004. The Company recorded net sales for the second quarter of
USD 593.1 million, a USD 112.2 million increase from the USD 480.9 million
recorded during the second quarter 2007. Adjusted EBITDA for the quarter
ended June 30th 2008 was USD 92.6 million, a 104% increase from the USD
45.5 million recorded in the second quarter 2007 and more than 60% higher
than the Company's previous record posted for the second quarter 2004.
Adjusted EBITDA is a non-GAAP financial measure used by Metals USA and its
creditors to monitor the performance of the business. |
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Murchison drops Midwest offer leaving Sinosteel as sole bidder Murchison Metals Ltd., an Australian iron ore producer, dropped its A$1.5 billion ($1.4 billion) all- share proposal to buy Midwest Corp., leaving China's Sinosteel Corp. as the sole bidder, reports said. Murchison failed to win the support of China's second- largest iron ore trader for its bid in weekend talks, Perth-based Murchison said in a statement to the Australian stock exchange. Sinosteel controls 45.6 percent of Midwest, it said. Iron ore prices have surged for six years because of rising Chinese demand. Sinosteel is also seeking a “substantial” stake in Murchison, a move that may allow it to combine and speed the development of the Australian companies' projects. “We have tried to reach agreement with Sinosteel to support the merger,'' Murchison Chairman Paul Kopejtka said today in the statement. ``However, Sinosteel made it clear that its primary objective at this time is to gain outright control of Midwest and we could not agree terms that made sense for our shareholders.” |
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Sahaviriya to import Chinese steel machinery at 10 billion yuan Sahaviriya Group, Thailand's biggest steel producer, hired China's Sino-International Heavy Industry Technology Ltd. to buy machinery and technology worth 10 billion yuan ($1.5 billion) for its plant, the Thai company said. Sahaviriya plans to produce 5 million tonnes of billet and slabs annually in the next two years. The expansion is part of the group's 15-year plan to make steel raw materials. Win Viriyaprapaikit, president of Sahaviriya Steel Industries Pcl, the group's biggest unit, said last month that the construction of the plant will probably start this year. The first stage of the project will require an investment of 90 billion baht ($2.7 billion). The steelmaker may invest 500 billion baht and make 30 million tonnes of billet and slabs during the 15-year period. The plan has been delayed for at least a year because of opposition by environmentalists. |
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South Africa as the biggest supplier of chrome ore to China South Africa has emerged as the largest exporter of chrome ore to China overtaking India in the first four months of this year as imports into the world's fastest growing major economy surged, sources said. “China imported 2.32 million tonnes of chrome ore in the first four months of 2008, up by 24 per cent,” Huang Tianwen, president of Sinosteel Corp., said in a speech in Johannesburg. South African ferrochrome supply will be flat until 2012 as power cuts curb output of the steelmaking raw material, local producers said. “The South African industry is losing credibility as a supplier and losing market share,” Merafe Resources Ltd. Chief Executive Officer Steve Phiri said at a conference in Johannesburg. Power cuts in South Africa are costing the industry between 250,000 and 350,000 tonnes a year of lost production. That will put pressure on global output. China imported 1.05 million of chrome ore from South Africa this year out of total imports of 2.94 million tonnes. |
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Posco may import ore to feed Orissa plant Posco, Asia's third-biggest steelmaker, may be forced to buy iron ore to feed its $12 billion steel plant in India should the government fail to award it a license to mine ore, sources said. “There is a possibility of iron ore requirement coming ahead of our captive mining operations,” a company source said. “In this situation, the state government has agreed to make the iron ore required available.” Land disputes and delays in allocating mining licenses have stopped South Korea-based Posco from proceeding with potentially the biggest overseas investment in India. The company is yet to begin building the 12 million metric ton steel plant in Orissa state. Work was scheduled to start in April 2007. Posco joins ArcelorMittal in seeking to expand in Asia, where steel usage is growing faster than in Europe and the US Posco faces opposition in Orissa as locals and political parties want the plant to move to non-arable areas from farmlands. Initially, Posco will build a 4 million metric tonne steel plant and set up a 400-megawatt power plant. |
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World stainless steel output may set below target World stainless steel production may be 30.5 million metric tonnes this year, more than 5 per cent below a projection last year, an industry expert said. Chinese output may be 8.3 million tonnes, 14 per cent lower than estimated last year. |
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Wuhan Steel profit rises 20% on Automakers demand Wuhan Iron & Steel Group., China's third-biggest steelmaker, said first-half profit rose 20 per cent as rising demand for automobile sheets and steel pipes, sources said. Crude-steel output rose 55 per cent to 11.3 million metric tonnes. Benchmark hot-rolled coil prices in China have gained by half in the past year, as Wuhan and rivals took advantage of rising demand. China's vehicle market increased 17 per cent in the first five months, according to the latest figures available from the country's auto trade group. Sales surged 90 per cent in the first six months from a year ago, the company said. China plans to extend its network of gas pipelines by 60 per cent to 80,000 kilometers (49,709 miles) in three years, China National Petroleum Corp. had said. Wuhan Steel supplies steel pipes to China National's unit PetroChina Co. |
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Nippon Steel doubles iron ore procurement price from BHP Nippon Steel Corp., the world's second-biggest steelmaker, accepted a record increase in iron ore prices from BHP Billiton Ltd., matching a doubling of prices agreed last month with Rio Tinto Group, reports said. The steelmaker, which in April said higher costs would cut annual profit 41 per cent, will pay BHP as much as 97 per cent more for ore. JFE Holdings Inc., Japan's second-biggest mill, also accepted the BHP increase. The BHP contracts, the last to be settled among Asian steelmakers and the world's three biggest suppliers of iron ore, marked the first year in which miners in Australia gained bigger price increases than rivals in Brazil. Nippon Steel and its largest Asian rivals in February agreed to increases of as much as 71 per cent from Cia. Vale do Rio Doce, the world's biggest iron-ore producer. Iron ore prices have gained almost fourfold since 2001 to a record, increasing costs for Japanese steelmakers, which rely exclusively on imported materials. It's the first time the year's initial agreement on ore price wasn't accepted as the benchmark. Baosteel Group Corp., China's biggest mill, accepted an increase of as much as 97 percent for ore from BHP, the world's biggest mining company. This matched an increase won last month from Asian steelmakers by Rio Tinto Group, the world's second-biggest iron-ore supplier. |
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Citigroup forecasts high thermal and coking coal in 2009 Citigroup Inc. raised its estimates for coking coal to make steel and thermal coal for power, citing the outlook for supply, sources said. The bank raised its coking-coal forecast for the 2009 Japanese financial year starting April 1 to $350 a metric ton, compared with an earlier estimate of $200. Thermal coal was raised to $200 a ton from $80, Sydney-based analysts Alan Heap and Alex Tonks said in a report. |
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