Saturday, 31 Dec 2011
BS reported that after inspection of illegal mining activities in Orissa during its six day visit, Justice M B Shah Commission of enquiry has sought updated information on status of prospecting license applications, renewal of mining leases and position of mining lease boundaries.
Chief Secretary Mr BK Patnaik said that "The Shah commission has sought latest information on status of PL applications, digitization of mining lease boundaries and renewal of mining leases in the state. We will provide the necessary information to the commission.”
As many as 344 applications for renewal of mining lease are pending at different levels. While 219 RML applications are pending at the government level, the pendency at the collectorate and directorate levels stands at 110 and 15 respectively. The steel & mines department had rejected RML cases of over 40 lessees lacking all statutory clearances.
Meanwhile, 51 lessees are operating their mines under deemed extension. The list of mines operating under deemed extension includes TATA Steel, Ferro Alloys Corporation Ltd, Essel Mining & Industries Ltd Mid-East Integrated Steel, Patnaik Minerals Ltd, RP Sao, Rungta Mines and OCL India among others.
Regarding digitization of mine lease boundaries, the state government claimed to have completed nearly 80 per cent of the work.
Prior to its visit to Orissa, the independent commission had sought information four times on various aspects and the state steel & mines department had complied with the same.
Besides seeking a detailed list of all lessees and their addresses, the probe panel in its last query had demanded information from the steel & mines department on alleged violation of Mines and Minerals Development and Regulation (MMDR) Act, 1957 and Mineral Concession Rules-1960 by Patnaik Minerals Private Ltd in the Joda circle.
During its visit to the state from December 7-13, the nine-member commission led by Justice Shah, former justice of the Supreme Court, had held discussions with top officials. The commission had urged the government to curb production so as to ensure that the finite mineral resource is left for future generations.
It had stressed on earmarking more funds by lessees for peripheral development. The commission, on the whole, had expressed satisfaction over the steps taken by the government but hinted at the involvement of bureaucrats in illegal mining activities
(Sourced from BS)
Saturday, December 31, 2011
Indian Finance ministry against canalization of exports
Saturday, 31 Dec 2011
The Indian Express reported that the Indian finance ministry has shot down commerce ministry’s suggestion that canalizing of iron ore exports would be an effective mechanism against illegal exports.
The finance ministry is instead keen to impose fiscal measures as an appropriate tool to discourage unaccounted export of the domestically mined mineral.
The suggestion of senior commerce ministry officials for canalizing iron ores through Minerals and Metals Trading Corporation was ruled out by Mr DK Mittal secretary, Department of Financial Services at a recent meeting convened by Mr PK Misra steel secretary.
According to the minutes of the meeting, “Mr Mittal pointed out that canalization is not the right instrument for controlling ore exports in the long-run. Instead, the Secretary DFS argued that imposing fiscal measures were the most appropriate tools. Mr Mittal further reasoned that canalization could at best be a temporary measure.”
Mr Mittal’s assertions assume importance in the backdrop of the commerce ministry’s recent communiqué telling the Cabinet that instances of private exporters resorting to illegal export of the mineral have been reported, which amounted to circumventing the Foreign Trade Policy.
Demanding tighter regulation of ore exports, the commerce ministry has pitched for canalizing exports of most grades of the mineral including the ones originating from the Goa Redi region to enforce regulation and accountability in exports.
In the note, commerce and industry minister Anand Sharma argued that state governments of Karnataka and Orissa had to intervene to contain illegal mining within their boundaries. So canalizing all ore exports through a single nodal agency MMTC would help curb illegal mining and prevent circumvention of EXIM policy since a single agency as an interim measure would be entrusted with exports and documentation could be checked suitably.
The finance ministry is more concerned about the huge losses incurred to the exchequer due to unaccounted exports of the some grades of the minerals.
In the last Budget, finance minister Mr Pranab Mukherjee had imposed a 20% ad valorem duty on ore exports following a campaign by the steel ministry for disincentivising ore exports as a strategy to conserve the mineral to meet the growing demand of domestic steel makers.
(Sourced from www.indianexpress.com)
The Indian Express reported that the Indian finance ministry has shot down commerce ministry’s suggestion that canalizing of iron ore exports would be an effective mechanism against illegal exports.
The finance ministry is instead keen to impose fiscal measures as an appropriate tool to discourage unaccounted export of the domestically mined mineral.
The suggestion of senior commerce ministry officials for canalizing iron ores through Minerals and Metals Trading Corporation was ruled out by Mr DK Mittal secretary, Department of Financial Services at a recent meeting convened by Mr PK Misra steel secretary.
According to the minutes of the meeting, “Mr Mittal pointed out that canalization is not the right instrument for controlling ore exports in the long-run. Instead, the Secretary DFS argued that imposing fiscal measures were the most appropriate tools. Mr Mittal further reasoned that canalization could at best be a temporary measure.”
Mr Mittal’s assertions assume importance in the backdrop of the commerce ministry’s recent communiqué telling the Cabinet that instances of private exporters resorting to illegal export of the mineral have been reported, which amounted to circumventing the Foreign Trade Policy.
Demanding tighter regulation of ore exports, the commerce ministry has pitched for canalizing exports of most grades of the mineral including the ones originating from the Goa Redi region to enforce regulation and accountability in exports.
In the note, commerce and industry minister Anand Sharma argued that state governments of Karnataka and Orissa had to intervene to contain illegal mining within their boundaries. So canalizing all ore exports through a single nodal agency MMTC would help curb illegal mining and prevent circumvention of EXIM policy since a single agency as an interim measure would be entrusted with exports and documentation could be checked suitably.
The finance ministry is more concerned about the huge losses incurred to the exchequer due to unaccounted exports of the some grades of the minerals.
In the last Budget, finance minister Mr Pranab Mukherjee had imposed a 20% ad valorem duty on ore exports following a campaign by the steel ministry for disincentivising ore exports as a strategy to conserve the mineral to meet the growing demand of domestic steel makers.
(Sourced from www.indianexpress.com)
Chinese acquisitions into Australia trebles
Saturday, 31 Dec 2011
It is reported that though the UK, the US and Canada are home to companies that engaged in 60% of Australian M&A in 2011, Chinese corporates announced deals worth USD 9.9 billion almost three times the USD 3.7 billion notched in 2010 according to Dealogic.
At 15.1%, China market share of inbound M&A volume has been helped by two deals which are yet to close the USD 2.1bn merger between Yanzhou Coal Mining and Gloucester Coal and Hanlong Mining USD 1.65 billion takeover of Sundance Resources.
Both are the largest Chinese Australian tie-ups on record behind Yanzhou USD 3.5 billion acquisition of Felix Resources in 2009 making Australia the most targeted nation by China in 2011 followed by France, Hong Kong, Canada and Brazil.
(Sourced from www.theaustralian.com.au)
It is reported that though the UK, the US and Canada are home to companies that engaged in 60% of Australian M&A in 2011, Chinese corporates announced deals worth USD 9.9 billion almost three times the USD 3.7 billion notched in 2010 according to Dealogic.
At 15.1%, China market share of inbound M&A volume has been helped by two deals which are yet to close the USD 2.1bn merger between Yanzhou Coal Mining and Gloucester Coal and Hanlong Mining USD 1.65 billion takeover of Sundance Resources.
Both are the largest Chinese Australian tie-ups on record behind Yanzhou USD 3.5 billion acquisition of Felix Resources in 2009 making Australia the most targeted nation by China in 2011 followed by France, Hong Kong, Canada and Brazil.
(Sourced from www.theaustralian.com.au)
Australian thermal coal price up in quiet market
Saturday, 31 Dec 2011
Reuters reported that Australia thermal coal price benchmark rose to over USD 116 per tonne in thin year-end holiday trading with near-term supply out of Newcastle, Australia largest thermal coal port, still tight.
Thermal coal on the global COAL Newcastle index for the week to date closed at USD 116.13 per tonne on Thursday up from USD 111.90 per tonne a week earlier. Wet weather and delayed maintenance schedules in the Hunter Valley, Australia main thermal coal producing region has kept supplies for early next year tight and supported prices.
The ongoing closure of the Orica explosives plant that supplies many Australian thermal coal miners has also constrained coal production. Orica explosives plant which supplies major coal miners in the area has been offline for several weeks, but the company is expected to restart the plant in the New Year after pre-start tests this week.
In China, the domestic coal price benchmark fell to CNY 808 per tonne last week from CNY 821 the previous week.
(Sourced from Reuters)
Reuters reported that Australia thermal coal price benchmark rose to over USD 116 per tonne in thin year-end holiday trading with near-term supply out of Newcastle, Australia largest thermal coal port, still tight.
Thermal coal on the global COAL Newcastle index for the week to date closed at USD 116.13 per tonne on Thursday up from USD 111.90 per tonne a week earlier. Wet weather and delayed maintenance schedules in the Hunter Valley, Australia main thermal coal producing region has kept supplies for early next year tight and supported prices.
The ongoing closure of the Orica explosives plant that supplies many Australian thermal coal miners has also constrained coal production. Orica explosives plant which supplies major coal miners in the area has been offline for several weeks, but the company is expected to restart the plant in the New Year after pre-start tests this week.
In China, the domestic coal price benchmark fell to CNY 808 per tonne last week from CNY 821 the previous week.
(Sourced from Reuters)
India to allot coal blocks on power tariff basis
Saturday, 31 Dec 2011
ET reported that Indian power companies will get coal blocks only if they quote low tariffs, a move that is expected to revive investment in the sector and protect consumers from spiraling electricity rates.
A top mines ministry official said blocks earmarked for the power sector will be given to states which will have to invite tariff based bids for electricity supply and than the states, in consultation with the power ministry, will then recommend allocation of blocks to the lowest bidders to the coal ministry.
The official said "This decision has been taken after the power ministry insistence to avoid a spike in retail electricity tariff. Since January 2011, power companies have to participate in tariff based bidding to bag state electricity contracts. Companies would have quoted higher tariff if coal blocks came at a high cost."
The government plans to auction 51 coal mines with 18,600 million tonnes of reserves after a gap of three years.
The official said cement and steel companies will have to participate in a two stage bidding process that will be based on upfront payment.
The mines ministry will notify the auction by competitive bidding of coal mines rules, 2011 once they are vetted by the law ministry. It expects aggressive bidding for the mines as overall coal deficit is likely to increase to 238 million tonnes by 2016-2017 from the present 53 million tonnes.
The government is already planning steps to cap electricity tariffs of companies that have secure supplies from Coal India or captive mines.
(Sourced from ET)
ET reported that Indian power companies will get coal blocks only if they quote low tariffs, a move that is expected to revive investment in the sector and protect consumers from spiraling electricity rates.
A top mines ministry official said blocks earmarked for the power sector will be given to states which will have to invite tariff based bids for electricity supply and than the states, in consultation with the power ministry, will then recommend allocation of blocks to the lowest bidders to the coal ministry.
The official said "This decision has been taken after the power ministry insistence to avoid a spike in retail electricity tariff. Since January 2011, power companies have to participate in tariff based bidding to bag state electricity contracts. Companies would have quoted higher tariff if coal blocks came at a high cost."
The government plans to auction 51 coal mines with 18,600 million tonnes of reserves after a gap of three years.
The official said cement and steel companies will have to participate in a two stage bidding process that will be based on upfront payment.
The mines ministry will notify the auction by competitive bidding of coal mines rules, 2011 once they are vetted by the law ministry. It expects aggressive bidding for the mines as overall coal deficit is likely to increase to 238 million tonnes by 2016-2017 from the present 53 million tonnes.
The government is already planning steps to cap electricity tariffs of companies that have secure supplies from Coal India or captive mines.
(Sourced from ET)
Friday, December 30, 2011
Coal India shifts to a globally accepted pricing method from Monday
Friday, 30 Dec, 2011
NEW DELHI: Coal India will from Monday price coal on gross heat value method - a globally accepted pricing mechanism for the fuel. The new system is not likely to lead to any significant change in the pricing, an official statement said.
"The ministry of coal is migrating to gross calorific value based grading system for non-coking coal from the existing useful heat value based system with effect from January 1, 2012," it said.
The statement said the new system will incentivise quality improvement resulting in delivery of quality coal to consume and commensurate revenue realisation for coal companies.
The new system is being introduced based on recommendations of Integrated Energy Policy and expert committee on road map for coal sector reforms.
(sourced ET)
NEW DELHI: Coal India will from Monday price coal on gross heat value method - a globally accepted pricing mechanism for the fuel. The new system is not likely to lead to any significant change in the pricing, an official statement said.
"The ministry of coal is migrating to gross calorific value based grading system for non-coking coal from the existing useful heat value based system with effect from January 1, 2012," it said.
The statement said the new system will incentivise quality improvement resulting in delivery of quality coal to consume and commensurate revenue realisation for coal companies.
The new system is being introduced based on recommendations of Integrated Energy Policy and expert committee on road map for coal sector reforms.
(sourced ET)
Italy seeks bigger euro fund after tough debt sale
Fri,Dec30, 2011
MILAN/ROME (Reuters) - Italian Prime Minister Mario Monti sought reinforcement for the euro zone's bailout fund and pledged new efforts to boost the economy after a disappointing bond auction on Thursday underlined the threat to the country's shaky public finances.
Investors demanded a yield of nearly 7 percent on 10-year paper at the auction of medium- and long-term bonds, down from the record highs seen last month but still unsustainable given the 450 billion euros that Italy needs to raise through debt issuance in 2012.
An unprecedented European Central Bank injection last week of nearly half a trillion euros of cheap funding for banks eased pressure at a short-term Italian debt auction on Wednesday, but longer-dated bonds still pose a challenge.
Monti put a brave face on the auction result, which analysts described as "slightly positive" or "average" at best.
"Auctions held yesterday and today went rather well, this is encouraging but the financial turbulence absolutely isn't over," Monti said during a traditional end-year press conference.
Italy, the euro zone's third largest economy, remains at the centre of the debt crisis that began in Greece two years ago and its borrowing needs could overwhelm the bloc's financial defences if it were forced to seek an international bailout.
"A lot of work remains to be done but from this point on, this work has to be done in Europe above all," Monti said.
He said the European Financial Stability Facility, the bailout fund set up by euro zone governments, needs "significantly greater" resources but refused to quantify how much more was required.
Monti promised to outline a first package of growth measures to European partners next month and said the emphasis would be on liberalising the economy, boosting competition and overhauling the jobs market, though he did not give details.
The measures will follow a 33 billion euro package of cuts and tax hikes aimed at balancing the budget by 2013 which was passed by parliament last week but which has been criticised for weighing too heavily on Italy's already sickly growth prospects.
Monti said he was aware that the austerity package had "many disadvantages" but said budget discipline was needed to restore confidence in Italy's public finances. However he added that European policy had to focus increasingly on growth.
"All mechanisms for making the application of this discipline more secure is welcome, provided it is integrated into a comprehensive European economic policy which has more resources to get the euro zone out of its current difficulties and above all promotes growth more," he said.
RECESSION
Italy's chronically weak economy over the past two decades has been one of the main factors in creating a debt burden that now amounts to around 120 percent of gross domestic product, second only to Greece in the euro zone.
Rigid labour rules - which give some workers iron-clad guarantees while forcing increasing numbers of young people to accept short term jobs with few prospects - an inefficient public sector, low productivity and choking red tape have long weighed on the economy.
Italy is widely considered to be heading for a severe recession next year and data on Thursday showed business confidence at its lowest for two years, with orders falling and the production outlook worsening.
Although he offered no firm timetable, Monti said the government would move quickly under pressure both from international partners and the bond markets.
"The timetable will be rapid. We aren't being permitted to work calmly," he said.
Underlining the pressure he faces, yields on 10-year bonds remained locked above 7 percent on the secondary market on Thursday, near the levels which forced Greece, Ireland and Portugal to seek an international bailout.
Italy sold 7 billion euros of bonds at auction in thin holiday markets, just above the mid-point of its target range, but the yield on benchmark 10 year BTPs was 6.98 percent, not far from a euro lifetime record of 7.56 percent a month ago.
"Buying 10-year Italian bonds is a leap of faith which investors are prepared to take only at very high interest rates," said Nicholas Spiro of Spiro Sovereign Strategy. "There are simply too many risks and uncertainties surrounding Italy."
Its 3-year bonds sold more easily and their yield fell more than two percentage points at auction to 5.62 percent -- far below the euro era record of 7.89 percent that Italy paid to sell the same bond at the end of November.
(sourced Reuters)
MILAN/ROME (Reuters) - Italian Prime Minister Mario Monti sought reinforcement for the euro zone's bailout fund and pledged new efforts to boost the economy after a disappointing bond auction on Thursday underlined the threat to the country's shaky public finances.
Investors demanded a yield of nearly 7 percent on 10-year paper at the auction of medium- and long-term bonds, down from the record highs seen last month but still unsustainable given the 450 billion euros that Italy needs to raise through debt issuance in 2012.
An unprecedented European Central Bank injection last week of nearly half a trillion euros of cheap funding for banks eased pressure at a short-term Italian debt auction on Wednesday, but longer-dated bonds still pose a challenge.
Monti put a brave face on the auction result, which analysts described as "slightly positive" or "average" at best.
"Auctions held yesterday and today went rather well, this is encouraging but the financial turbulence absolutely isn't over," Monti said during a traditional end-year press conference.
Italy, the euro zone's third largest economy, remains at the centre of the debt crisis that began in Greece two years ago and its borrowing needs could overwhelm the bloc's financial defences if it were forced to seek an international bailout.
"A lot of work remains to be done but from this point on, this work has to be done in Europe above all," Monti said.
He said the European Financial Stability Facility, the bailout fund set up by euro zone governments, needs "significantly greater" resources but refused to quantify how much more was required.
Monti promised to outline a first package of growth measures to European partners next month and said the emphasis would be on liberalising the economy, boosting competition and overhauling the jobs market, though he did not give details.
The measures will follow a 33 billion euro package of cuts and tax hikes aimed at balancing the budget by 2013 which was passed by parliament last week but which has been criticised for weighing too heavily on Italy's already sickly growth prospects.
Monti said he was aware that the austerity package had "many disadvantages" but said budget discipline was needed to restore confidence in Italy's public finances. However he added that European policy had to focus increasingly on growth.
"All mechanisms for making the application of this discipline more secure is welcome, provided it is integrated into a comprehensive European economic policy which has more resources to get the euro zone out of its current difficulties and above all promotes growth more," he said.
RECESSION
Italy's chronically weak economy over the past two decades has been one of the main factors in creating a debt burden that now amounts to around 120 percent of gross domestic product, second only to Greece in the euro zone.
Rigid labour rules - which give some workers iron-clad guarantees while forcing increasing numbers of young people to accept short term jobs with few prospects - an inefficient public sector, low productivity and choking red tape have long weighed on the economy.
Italy is widely considered to be heading for a severe recession next year and data on Thursday showed business confidence at its lowest for two years, with orders falling and the production outlook worsening.
Although he offered no firm timetable, Monti said the government would move quickly under pressure both from international partners and the bond markets.
"The timetable will be rapid. We aren't being permitted to work calmly," he said.
Underlining the pressure he faces, yields on 10-year bonds remained locked above 7 percent on the secondary market on Thursday, near the levels which forced Greece, Ireland and Portugal to seek an international bailout.
Italy sold 7 billion euros of bonds at auction in thin holiday markets, just above the mid-point of its target range, but the yield on benchmark 10 year BTPs was 6.98 percent, not far from a euro lifetime record of 7.56 percent a month ago.
"Buying 10-year Italian bonds is a leap of faith which investors are prepared to take only at very high interest rates," said Nicholas Spiro of Spiro Sovereign Strategy. "There are simply too many risks and uncertainties surrounding Italy."
Its 3-year bonds sold more easily and their yield fell more than two percentage points at auction to 5.62 percent -- far below the euro era record of 7.89 percent that Italy paid to sell the same bond at the end of November.
(sourced Reuters)
Iron Ore-China prices set for 20 pct decline in 2011
Fri Dec 30, 2011
* Prices down 20 pct in 2011 on low credit, economic uncertainty(sourced Reuters)
* Indexes rise on Friday as traders, mills buy before year-end
* Shanghai rebar futures steady, down 15 pct from June peak
BEIJING, Dec 30 (Reuters) - Iron ore prices in China,the world's biggest market, are headed for a 20 percent decline
this year because of a government-mandated credit crunch as well as uncertainties about steel demand at home and overseas, and
few analysts see them recovering soon.Rising interest and reserve requirement rates over the year
made it difficult for traders and steel mills to find the funds required to make large purchases. The rapid drop in prices over
September and October also left many traders facing heavy losses.
Spot iron ore prices inched up on Friday after a flurry of speculative purchases ahead of the new year. Industry
consultancy Umetal said spot offer prices for 61-percent Pilbara fines gained $1 to $136-139 per tonne, including cost and
freight, after staying flat for six consecutive days.On Thursday, traders in China purchased Pilbara fines at a
price of $137.8 per tonne, Malaysian lump at a price of $135 per tonne, 63-percent Brazilian fines at $155 per tonne and
Ukrainian 65-percent concentrate at $184 per tonne, Umetal said in its "Trading Signals" report on Friday.
Major indexes all made gains on Thursday. Ore with 62 percent iron content stood at $138.4 a tonne on Thursday,
according to The Steel Index .IO62-CNI=SI, up 1.17 percent on the day but down 18.6 percent compared to Jan. 1.
"There must have been a bit of buying going on before the new year break, and some must be hoping to profit from a jump in
prices in the new year," said a trader based in Shanghai."My feeling is that prices are back at their natural level
after falling so quickly (in October), so I'm not expecting any major adjustments in the coming few weeks, but there could be a
policy announcement to stimulate buying," he said.
Iron ore prices reached a nadir of around $116 per tonne at the end of October but bounced back as end-users sought to
replenish their stockpiles. Mills now have enough to see them through the lunar new year holiday beginning on Jan. 22.
According to a survey by industry consultancy Mysteel, 55 small- and medium-sized steel mills had an average of 39 days of
imported iron ore stocks by the end of last week, up from 31 days a month earlier.
Traders are now looking to see what the new year will bring.While some expect the government to ease the tight credit
restrictions imposed in 2011, few envisage a return to the price levels seen earlier this year.
"I'd be very surprised if prices return to $190 -- it was clear that those prices were unsustainable," said the Shanghai
trader.
According to a Reuters poll, spot prices of 62 percent iron ore are expected to average $150 per tonne including cost and
freight in 2012. The most traded steel rebar futures contract in Shanghai was largely unchanged on Friday, ending at 4,210 yuan
($670) per tonne,up 9 yuan since the previous close and down 15 percent from its peak at the beginning of June.
Shanghai rebar futures and iron ore indexes at 0700 GMT
Contract Last Change Pct Change
SHANGHAI REBAR* 4210 9.00 0.21
PLATTS 62 PCT INDEX 139 1.75 1.28
THE STEEL INDEX 62 PCT INDEX 138.4 1.60 1.17
METAL BULLETIN INDEX 138.09 1.32 0.97
*In yuan/tonne
#Index in dollars/tonne, shows close for the previous trading
day ($1 = 6.3192 yuan)
China imported iron ore stocks down in wk ending Dec 30
Fri Dec 30, 2011
BEIJING, Dec 30 (Reuters) - Stockpiles of imported iron ore at major Chinese ports fell this week to 95.6 million
tonnes, according to industry consultancy Mysteel
Following is a table showing iron ore port stock movements
in the last seven days.
Country of Stockpiles Change (%)
origin (mln T)
Total 95.60 -1.26%
Australia 41.70 -1.58%
Brazil 23.83 +0.8%
India 9.64 -4.27%
Sourced: Mysteel & Reuters
Brazil’s MMX secures iron ore transportation contract
Friday, 30 December 2011
Brazilian mining company MMX, run by billionaire Eike Batista, signed a 15-year shipping contract with MRS Logistica on Wednesday. MRS will transport iron ore from MMX's mine in Minas Gerais, Brazil to the Sudeste port in Rio de Janeiro.
Under the terms of the contract, MRS will transport 36 million metric tons of iron ore annually from the MMX mine for R26.5 (US$14.12) per metric ton shipped.
Tags: iron ore , raw mat , Brazil , South America , trading , mining
Sourced:SteelOrbis
Brazilian mining company MMX, run by billionaire Eike Batista, signed a 15-year shipping contract with MRS Logistica on Wednesday. MRS will transport iron ore from MMX's mine in Minas Gerais, Brazil to the Sudeste port in Rio de Janeiro.
Under the terms of the contract, MRS will transport 36 million metric tons of iron ore annually from the MMX mine for R26.5 (US$14.12) per metric ton shipped.
Tags: iron ore , raw mat , Brazil , South America , trading , mining
Sourced:SteelOrbis
Karnataka based steel mills seek early resolution from SC
Friday, 30 Dec 2011
Business Standard reported that steel companies in south India have approached the Supreme Court again, seeking permission for clean iron ore mining companies to restart operations in Karnataka.
Mr Vinod Nowal director and CEO of JSW Steel said that “The stockpile of 25 million tonnes put up for sale through E auction would last till April 2012. To ensure continuous supply of to steel mills, it’s essential to restart the mining by at least clean mining companies. So, we have made a request to the apex court through the Karnataka Iron and Steel Manufacturers Association to give permission for clean mining companies.”
Mr Nowal said KISMA would make another appeal on January 20, when the apex court restarts hearing the case.
He said “There is a need for an urgent action in this regard, as the Karnataka government is yet to submit mine wise R&R plan to the court. It would be helpful for the steel industry if the court permits recommencement of mining in selected mines in Karnataka, as the state government may take more time to submit the plan.”
The state government has appointed the Indian Council of Forestry Research and Education to prepare the plan for each mine in the three districts. It is said ICFRE may take up to six months to complete the plan.
The Supreme Court, in its order on July 29, had ordered suspension of all mining activities in Bellary district. On August 26, the court banned mining in Chitradurga and Tumkur districts. So, 16 steel mills, including JSW Steel, Kalyani Steels Ltd, Mukand Steels Ltd, Kirloskar Ferrous, VISL Bhadravathi, MSPL Ltd, BMM Ispat Ltd and Sathavahana Ispat, are facing shortage of iron ore.
(Sourced from BS)
Business Standard reported that steel companies in south India have approached the Supreme Court again, seeking permission for clean iron ore mining companies to restart operations in Karnataka.
Mr Vinod Nowal director and CEO of JSW Steel said that “The stockpile of 25 million tonnes put up for sale through E auction would last till April 2012. To ensure continuous supply of to steel mills, it’s essential to restart the mining by at least clean mining companies. So, we have made a request to the apex court through the Karnataka Iron and Steel Manufacturers Association to give permission for clean mining companies.”
Mr Nowal said KISMA would make another appeal on January 20, when the apex court restarts hearing the case.
He said “There is a need for an urgent action in this regard, as the Karnataka government is yet to submit mine wise R&R plan to the court. It would be helpful for the steel industry if the court permits recommencement of mining in selected mines in Karnataka, as the state government may take more time to submit the plan.”
The state government has appointed the Indian Council of Forestry Research and Education to prepare the plan for each mine in the three districts. It is said ICFRE may take up to six months to complete the plan.
The Supreme Court, in its order on July 29, had ordered suspension of all mining activities in Bellary district. On August 26, the court banned mining in Chitradurga and Tumkur districts. So, 16 steel mills, including JSW Steel, Kalyani Steels Ltd, Mukand Steels Ltd, Kirloskar Ferrous, VISL Bhadravathi, MSPL Ltd, BMM Ispat Ltd and Sathavahana Ispat, are facing shortage of iron ore.
(Sourced from BS)
Vale enters mining sector in Ethiopia
Friday, 30 Dec 2011
Local media reported that mining giant Vale has entered the Ethiopian mining sector with an exploration license received from the Ministry of Mines.
The Brazilian mining company established an exploration site on a 900 square kilometers concession in the Konso area, Ethiopia.
Mr Marcelo A. Borges First Secretary and Deputy Mission at the Brazilian Embassy said that Vale expects to explore and extract gold as well as seeking other commercially viable minerals such as iron ore.
In Africa Vale is presently active in Angola, the Democratic Republic of the Congo, Gabon, Guinea, Liberia, Malawi, Mozambique, and South Africa.
(Sourced from 2merkato.com)
Local media reported that mining giant Vale has entered the Ethiopian mining sector with an exploration license received from the Ministry of Mines.
The Brazilian mining company established an exploration site on a 900 square kilometers concession in the Konso area, Ethiopia.
Mr Marcelo A. Borges First Secretary and Deputy Mission at the Brazilian Embassy said that Vale expects to explore and extract gold as well as seeking other commercially viable minerals such as iron ore.
In Africa Vale is presently active in Angola, the Democratic Republic of the Congo, Gabon, Guinea, Liberia, Malawi, Mozambique, and South Africa.
(Sourced from 2merkato.com)
Vietnam December coal exports down by 10pct
Friday, 30 Dec 2011
Dow Jones Commodities News Select via Comtex quoted the General Statistics Office said Vietnam exported 1.8 million tonnes of coal in December down 10% from 2 million tons in November.
The GSO said in a statement that coal exports in 2011 reached 17.67 million tonnes down by 10.9%.
State run Vietnam National Coal, Mineral Industries Holding Corp or Vinacomin said earlier this year that it will cut coal exports to 14 million tonnes in 2012.
The company also plans to gradually cut annual coal exports to 3 million tonnes a year by 2015 to set aside the fossil fuel for its power plants.
(Sourced from Dow Jones Commodities)
Dow Jones Commodities News Select via Comtex quoted the General Statistics Office said Vietnam exported 1.8 million tonnes of coal in December down 10% from 2 million tons in November.
The GSO said in a statement that coal exports in 2011 reached 17.67 million tonnes down by 10.9%.
State run Vietnam National Coal, Mineral Industries Holding Corp or Vinacomin said earlier this year that it will cut coal exports to 14 million tonnes in 2012.
The company also plans to gradually cut annual coal exports to 3 million tonnes a year by 2015 to set aside the fossil fuel for its power plants.
(Sourced from Dow Jones Commodities)
Coal producers in Indonesia and Vietnam undertake new export strategies
Friday, 30 Dec 2011
It is reported that fast rising economies in Southeast Asia, Indonesia and Vietnam have taken different strategies in handling rising coal demand in the region.
Vietnam has announced that it will calibrate its exports to meet increasing coal demand in the domestic markets. Indonesia, on the other hand plans to increase exports and meet rising demand in the Asia Pacific Region.
The Indonesian Coal Mining Association said Jakarta is expected to upgrade its output in 2012 to no less than as 390 million tonnes of the fuel in 2012 to satisfy demand from Asian buyers particularly India and China.
A related Bloomberg report said the country is estimated to mine 360 million tons this year. Indonesia is still the world largest thermal coal exporter.
Mr Tran Xuan Hoa Vietnam state owned coal exporter Vinacomin chairman said in an annual coal exports report this month that Vietnam, on the other hand, decided to cut down its coal exports and be a net importer to support the growing local industries.
State run Vietnam News Agency reported quoting Vinacomin said coal exports will be slashed by 19.6% to 13.3 million tonnes in 2012 from 16.8 million MT this year.
Vinacomin said Vietnam coal exports will gradually be slashed to 8 million MT in 2013 and between 4 million tonnes and 5 million tonnes from 2015.
(Sourced from community.nasdaq.com)
It is reported that fast rising economies in Southeast Asia, Indonesia and Vietnam have taken different strategies in handling rising coal demand in the region.
Vietnam has announced that it will calibrate its exports to meet increasing coal demand in the domestic markets. Indonesia, on the other hand plans to increase exports and meet rising demand in the Asia Pacific Region.
The Indonesian Coal Mining Association said Jakarta is expected to upgrade its output in 2012 to no less than as 390 million tonnes of the fuel in 2012 to satisfy demand from Asian buyers particularly India and China.
A related Bloomberg report said the country is estimated to mine 360 million tons this year. Indonesia is still the world largest thermal coal exporter.
Mr Tran Xuan Hoa Vietnam state owned coal exporter Vinacomin chairman said in an annual coal exports report this month that Vietnam, on the other hand, decided to cut down its coal exports and be a net importer to support the growing local industries.
State run Vietnam News Agency reported quoting Vinacomin said coal exports will be slashed by 19.6% to 13.3 million tonnes in 2012 from 16.8 million MT this year.
Vinacomin said Vietnam coal exports will gradually be slashed to 8 million MT in 2013 and between 4 million tonnes and 5 million tonnes from 2015.
(Sourced from community.nasdaq.com)
Mitsui OSK Lines orders new high efficiency Capesize iron ore carrier
Friday, 30 Dec 2011
Mitsui OSK Lines Ltd announced that it has ordered a new Capesize bulker that will adopt element technologies of the next generation ISHIN-III vessel program to achieve high fuel efficiency. Universal Shipbuilding Corporation will construct the new ship, slated for completion in late 2014.
MOL has repeatedly studied various technologies to realize the concept for the ISHIN-III series of next generation vessels announced in April 2010. The new vessel will adopt the following element technologies which are at the core of the ISHIN-III concept. New technologies will boost fuel efficiency of the new ship by more than 20% compared to conventional cape-size vessels with a corresponding reduction in CO2 emissions.
1. Waste heat energy recovery to assist propulsion
This concept seeks to maximize waste heat energy recovery with more advanced technology. A large amount of heat energy can be recovered from the large main engine’s exhaust gas, converted to electricity, and utilized to provide additional propulsion, significantly reducing the vessel’s environmental burden. This technology can also be applied to large main engines installed on tankers and containerships.
2. Reduction of CO2 emissions even at low speeds
The combination of a turbocharger that can operate at high efficiency even at low rpm and an electronically-controlled main engine reduces CO2 emissions even during a low-speed voyage.
MOL continues to take a proactive stance in technological development with the aim of reducing the environmental burden of its ships.
Mitsui OSK Lines Ltd announced that it has ordered a new Capesize bulker that will adopt element technologies of the next generation ISHIN-III vessel program to achieve high fuel efficiency. Universal Shipbuilding Corporation will construct the new ship, slated for completion in late 2014.
MOL has repeatedly studied various technologies to realize the concept for the ISHIN-III series of next generation vessels announced in April 2010. The new vessel will adopt the following element technologies which are at the core of the ISHIN-III concept. New technologies will boost fuel efficiency of the new ship by more than 20% compared to conventional cape-size vessels with a corresponding reduction in CO2 emissions.
1. Waste heat energy recovery to assist propulsion
This concept seeks to maximize waste heat energy recovery with more advanced technology. A large amount of heat energy can be recovered from the large main engine’s exhaust gas, converted to electricity, and utilized to provide additional propulsion, significantly reducing the vessel’s environmental burden. This technology can also be applied to large main engines installed on tankers and containerships.
2. Reduction of CO2 emissions even at low speeds
The combination of a turbocharger that can operate at high efficiency even at low rpm and an electronically-controlled main engine reduces CO2 emissions even during a low-speed voyage.
MOL continues to take a proactive stance in technological development with the aim of reducing the environmental burden of its ships.
Thursday, December 29, 2011
Steam coal market in low activity
Thursday, 29 Dec 2011
Reuters reported that physical prompt coal markets saw little activity in the first full day of trading after Christmas on Wednesday and in the absence of spot trades to give price direction, coal was largely tracking the oil, as it has for the past few months.
There was little coal trading activity on Wednesday as many traders were bridging the Christmas and New Year holidays.
No physical trades were heard, but February South African Richard's Bay cargoes saw a bid/offer range of USD 104.75 to USD 107.15 per tonne, and March cargoes saw a range of USD 105.50 to USD 108.
(Sourced from Reuters)
Reuters reported that physical prompt coal markets saw little activity in the first full day of trading after Christmas on Wednesday and in the absence of spot trades to give price direction, coal was largely tracking the oil, as it has for the past few months.
There was little coal trading activity on Wednesday as many traders were bridging the Christmas and New Year holidays.
No physical trades were heard, but February South African Richard's Bay cargoes saw a bid/offer range of USD 104.75 to USD 107.15 per tonne, and March cargoes saw a range of USD 105.50 to USD 108.
(Sourced from Reuters)
Coal ship queue hits 60 at Newcastle Port in Australia
Thursday, 29 Dec 2011
ABC reported that Newcastle's ship queue has hit 60 for the first time in several years, as global demand for coal continues to rise.
In October the Hunter Valley Coal Chain Coordinator warned of increased ship queues, due to planned coal chain maintenance outages, combined with strong demand.
More than 50 vessels were waiting to be loaded at Port Waratah Coal Services Newcastle coal loaders at the end of last month.
Now there are 60 vessels, a number not seen for several years.
But a vessel arrival system means only 20 ships can stay in the Newcastle anchorage, with others anchored elsewhere or in transit.
But the ship queue spike is not expected to affect export targets through the Port of Newcastle.
The ship queue should drop soon with the number of vessels waiting expected to be below 40 at the end of January.
(Sourced from abc.net.au)
ABC reported that Newcastle's ship queue has hit 60 for the first time in several years, as global demand for coal continues to rise.
In October the Hunter Valley Coal Chain Coordinator warned of increased ship queues, due to planned coal chain maintenance outages, combined with strong demand.
More than 50 vessels were waiting to be loaded at Port Waratah Coal Services Newcastle coal loaders at the end of last month.
Now there are 60 vessels, a number not seen for several years.
But a vessel arrival system means only 20 ships can stay in the Newcastle anchorage, with others anchored elsewhere or in transit.
But the ship queue spike is not expected to affect export targets through the Port of Newcastle.
The ship queue should drop soon with the number of vessels waiting expected to be below 40 at the end of January.
(Sourced from abc.net.au)
Ore sales to China poised to rise - Report
Thursday, 29 Dec 2011
According to researcher Umetal.com, iron ore prices could rise to USD 150 a tonne by March on expectations China central bank will ease credit conditions after the Chinese New Year.
Mr Xu Guangjian Beijing-based Umetal.com analyst said the steelmaking raw material may trade between USD 130 and USD 160 a tonne next year.
He said that "Ore prices may rise moderately after the holidays. Still, there are no signs steel demand will have a substantial recovery in other sectors such as automobiles and home appliances."
Mr Xu said iron ore may remain below USD 140 before the Chinese New Year as the country's steelmakers the world biggest consumers limit purchases.
The week-long Chinese new year holidays start on January 23. Workers usually return to work after the Lantern Festival, the 15th day of the New Year.
Passenger car sales in China rose 0.3 per cent in the past month, the slowest pace in six months, according to the China Association of Automobile Manufacturers.
According to Umetal China construction industry accounts for about 53% of the nation steel demand, while cars make up 7%.
Crude-steel output in China, the world's biggest producer, fell to 49.9 million tonnes in November, the lowest level in 14 months as a slower economy eroded demand and cut prices.
(Sourced from The Australian)
According to researcher Umetal.com, iron ore prices could rise to USD 150 a tonne by March on expectations China central bank will ease credit conditions after the Chinese New Year.
Mr Xu Guangjian Beijing-based Umetal.com analyst said the steelmaking raw material may trade between USD 130 and USD 160 a tonne next year.
He said that "Ore prices may rise moderately after the holidays. Still, there are no signs steel demand will have a substantial recovery in other sectors such as automobiles and home appliances."
Mr Xu said iron ore may remain below USD 140 before the Chinese New Year as the country's steelmakers the world biggest consumers limit purchases.
The week-long Chinese new year holidays start on January 23. Workers usually return to work after the Lantern Festival, the 15th day of the New Year.
Passenger car sales in China rose 0.3 per cent in the past month, the slowest pace in six months, according to the China Association of Automobile Manufacturers.
According to Umetal China construction industry accounts for about 53% of the nation steel demand, while cars make up 7%.
Crude-steel output in China, the world's biggest producer, fell to 49.9 million tonnes in November, the lowest level in 14 months as a slower economy eroded demand and cut prices.
(Sourced from The Australian)
Royal Coal gets new sales contracts for 2012 for its US mines
Thursday, 29 Dec 2011
The Canadian Press reported that Royal Coal Corp, a Toronto-based junior miner with operations in the United States, says it has got a major new sales contract and has struck a deal to expand its coal output in Kentucky.
The company said that it has received contracts to deliver 234,000 tons of coal from its Appalachian mines at an average sales price of USD 85 a ton.
Moreover, in a separate development, Royal Coal said it had negotiated agreements to mine and sell coal from the Flatwoods mine in Kentucky on a contract basis.
Royal Coal said the sales contracts with coal fired power plant operators are key to the company's growth strategy.
Mr Tom Griffis chairman of Royal Coal said “These contracts are very attractive and give the company a solid foundation of sales for the upcoming year. The company is pursuing increased production from its own operations and permits as well as the potential of additional production through the acquisition of new assets. Royal Coal also anticipates new term contacts to be signed over the coming weeks for additional sales in 2012.”
Royal Coal has open pit coal mines in the central Appalachian coal producing region of the United States, which includes parts of West Virginia, Virginia, Kentucky, Ohio, and Tennessee.
(Sourced from canadianbusiness.com)
The Canadian Press reported that Royal Coal Corp, a Toronto-based junior miner with operations in the United States, says it has got a major new sales contract and has struck a deal to expand its coal output in Kentucky.
The company said that it has received contracts to deliver 234,000 tons of coal from its Appalachian mines at an average sales price of USD 85 a ton.
Moreover, in a separate development, Royal Coal said it had negotiated agreements to mine and sell coal from the Flatwoods mine in Kentucky on a contract basis.
Royal Coal said the sales contracts with coal fired power plant operators are key to the company's growth strategy.
Mr Tom Griffis chairman of Royal Coal said “These contracts are very attractive and give the company a solid foundation of sales for the upcoming year. The company is pursuing increased production from its own operations and permits as well as the potential of additional production through the acquisition of new assets. Royal Coal also anticipates new term contacts to be signed over the coming weeks for additional sales in 2012.”
Royal Coal has open pit coal mines in the central Appalachian coal producing region of the United States, which includes parts of West Virginia, Virginia, Kentucky, Ohio, and Tennessee.
(Sourced from canadianbusiness.com)
Wednesday, December 28, 2011
AP HC rejects bail of mining scam accused
Wednesday, 28 Dec 2011
The Andhra Pradesh High Court on Monday cancelled the bail order for former Managing Director of APMDC, Mr VD Rajagopal, issued by a special CBI court.
Mr Rajagopal was taken into custody for his alleged involvement in the illegal mining scam involving the Obulapuram Mining Company of Gali Janardhan Reddy.
The High Court on December 16 stayed the special court’s order. The CBI investigation is still underway and the accused, if out on bail, may influence the witnesses, the court had contested.
Justice NRL Rao cancelled the bail order responding to a petition filed by the CBI, challenging the special court’s verdict.
Mr Rajagopal allegedly played a key role in granting the mining leases to OMC. Now, the government has stalled all mining activities and transport of iron ore.
The special court granted Rajagopal bail on December 15, but backtracked on its decision within three hours and stayed the order till December 19, after the CBI filed a petition.
The very next day, the CBI had moved the HC, challenging the bail order.
The OMC, Anthar Gangamma Mining Company, YM Mahabaleswarappa and Sons Mining Company and Bellary Iron Ore Private Limited were mining iron ore in about 500 acres in the D Herehall mandal bordering Karnataka. Of the six mines, four were owned by former Karnataka minister Gali Janardhan Reddy.
(Sourced from www.deccanherald.com)
The Andhra Pradesh High Court on Monday cancelled the bail order for former Managing Director of APMDC, Mr VD Rajagopal, issued by a special CBI court.
Mr Rajagopal was taken into custody for his alleged involvement in the illegal mining scam involving the Obulapuram Mining Company of Gali Janardhan Reddy.
The High Court on December 16 stayed the special court’s order. The CBI investigation is still underway and the accused, if out on bail, may influence the witnesses, the court had contested.
Justice NRL Rao cancelled the bail order responding to a petition filed by the CBI, challenging the special court’s verdict.
Mr Rajagopal allegedly played a key role in granting the mining leases to OMC. Now, the government has stalled all mining activities and transport of iron ore.
The special court granted Rajagopal bail on December 15, but backtracked on its decision within three hours and stayed the order till December 19, after the CBI filed a petition.
The very next day, the CBI had moved the HC, challenging the bail order.
The OMC, Anthar Gangamma Mining Company, YM Mahabaleswarappa and Sons Mining Company and Bellary Iron Ore Private Limited were mining iron ore in about 500 acres in the D Herehall mandal bordering Karnataka. Of the six mines, four were owned by former Karnataka minister Gali Janardhan Reddy.
(Sourced from www.deccanherald.com)
Mega Vale iron ore ship sails for Philippines
Wednesday, 28 Dec 2011
Reuters reported that one of Vale mega ore carriers, among the world biggest is expected to arrive in the Philippines this week to unload its maiden cargo of Brazilian iron ore as the miner fleet remains locked out of its biggest market, China.
Vale has been forced to divert its fleet of six mega vessels to the Philippines, Italy, Oman and other destinations while waiting for Beijing to give it access to Chinese ports. The 388,000-tonne Berge Everest leased from Singapore-based Berge Bulk is the first of Vale planned fleet of 35 giant vessels to travel to Asia fully loaded with iron ore.
According to Reuters Freightviews after a brief stop to refuel in Singapore this month, the ship will dock in the Port of Villanueva in the Philippines.
A port agent said it is expected to then transfer the iron ore to two smaller capesize vessels, bound most likely for China.
A domestic port agent who wished not to be identified because his company was not handling the vessel said "It seems as though the ship will be unloading in the Philippines. I guess we will be the iron ore centre for Vale in Asia until their China problem is resolved."
Berge Bulk and Philippine Sinter Corp which operates the Villanueva port and is a subsidiary of Japan JFE Steel Corp were not immediately available for comment.
(Sourced from Reuters)
Reuters reported that one of Vale mega ore carriers, among the world biggest is expected to arrive in the Philippines this week to unload its maiden cargo of Brazilian iron ore as the miner fleet remains locked out of its biggest market, China.
Vale has been forced to divert its fleet of six mega vessels to the Philippines, Italy, Oman and other destinations while waiting for Beijing to give it access to Chinese ports. The 388,000-tonne Berge Everest leased from Singapore-based Berge Bulk is the first of Vale planned fleet of 35 giant vessels to travel to Asia fully loaded with iron ore.
According to Reuters Freightviews after a brief stop to refuel in Singapore this month, the ship will dock in the Port of Villanueva in the Philippines.
A port agent said it is expected to then transfer the iron ore to two smaller capesize vessels, bound most likely for China.
A domestic port agent who wished not to be identified because his company was not handling the vessel said "It seems as though the ship will be unloading in the Philippines. I guess we will be the iron ore centre for Vale in Asia until their China problem is resolved."
Berge Bulk and Philippine Sinter Corp which operates the Villanueva port and is a subsidiary of Japan JFE Steel Corp were not immediately available for comment.
(Sourced from Reuters)
CoAL sells NiMag in management buyout
Wednesday, 28 Dec 2011
Coal of Africa has agreed to the sale of the NiMag Group of companies, consisting of Nimag and Metalloy Resources Investments by way of a management buyout.
CoAL considers the NiMag Group asset to be non-core and it has been classified as an asset held for sale.
The directors of NiMag will purchase a 100% interest in the group for BRL 54 million of which 60% is being funded by a combination of equity contributions and bank debt with the remaining 40% being financed by way of an interest bearing vendor financing loan provided by CoAL repayable over four years.
The transaction is expected to be completed by end-February 2012.
Mr John Wallington CoAL CEO said "This is a specialist business that under the current management team will continue to grow and develop over time. He said that our focus at CoAL is on the development of our coking coal and thermal coal businesses. Fast tracking Vele into production and concluding the feasibility study for Makhado are priorities for us. Our management and financial resources are focussed on that."
(Sourced from miningmx.com)
Coal of Africa has agreed to the sale of the NiMag Group of companies, consisting of Nimag and Metalloy Resources Investments by way of a management buyout.
CoAL considers the NiMag Group asset to be non-core and it has been classified as an asset held for sale.
The directors of NiMag will purchase a 100% interest in the group for BRL 54 million of which 60% is being funded by a combination of equity contributions and bank debt with the remaining 40% being financed by way of an interest bearing vendor financing loan provided by CoAL repayable over four years.
The transaction is expected to be completed by end-February 2012.
Mr John Wallington CoAL CEO said "This is a specialist business that under the current management team will continue to grow and develop over time. He said that our focus at CoAL is on the development of our coking coal and thermal coal businesses. Fast tracking Vele into production and concluding the feasibility study for Makhado are priorities for us. Our management and financial resources are focussed on that."
(Sourced from miningmx.com)
Floods derail freight train in Australia
Wed, 28 Dec 2011
AFP reported that heavy flooding following a tropical cyclone in northern Australia swept a 20 carriage freight train off a bridge on Tuesday, injuring the driver, as the storm system threatened to intensify.
The iron ore train derailed following torrential rain in the Northern Territory caused by Grant, a tropical cyclone that triggered heavy flooding in some areas, swamping roads and stranding scores of people.
Its two crew members both managed to escape and were assessed by medical staff who were sent by helicopter to the scene, with the driver later airlifted to hospital with spinal injuries, according to local media reports.
Northern Territory police said in a statement that "The ATSB (Australian Transport Safety Bureau) has been notified of the crash and will take carriage of the investigation.”
The Northern Territory's environment department, NRETAS, said it was examining whether any material from the train had leaked into the floodwaters. It said “It's still unclear exactly what the components were on that train. We will definitely be sending down investigators who will do an environmental impact and check it all out, but it's inaccessible at the moment because of the floodwaters. All I can say is we are investigating. It is of concern.”
The railway's operator, US-based Genesee and Wyoming, said a number of containers carrying "domestic consumables and copper concentrate" had derailed and 50 metres of track had been washed away.
Copper concentrate is considered a class nine environmentally hazardous substance.
(Sourced from AFP and terradaily.com)
AFP reported that heavy flooding following a tropical cyclone in northern Australia swept a 20 carriage freight train off a bridge on Tuesday, injuring the driver, as the storm system threatened to intensify.
The iron ore train derailed following torrential rain in the Northern Territory caused by Grant, a tropical cyclone that triggered heavy flooding in some areas, swamping roads and stranding scores of people.
Its two crew members both managed to escape and were assessed by medical staff who were sent by helicopter to the scene, with the driver later airlifted to hospital with spinal injuries, according to local media reports.
Northern Territory police said in a statement that "The ATSB (Australian Transport Safety Bureau) has been notified of the crash and will take carriage of the investigation.”
The Northern Territory's environment department, NRETAS, said it was examining whether any material from the train had leaked into the floodwaters. It said “It's still unclear exactly what the components were on that train. We will definitely be sending down investigators who will do an environmental impact and check it all out, but it's inaccessible at the moment because of the floodwaters. All I can say is we are investigating. It is of concern.”
The railway's operator, US-based Genesee and Wyoming, said a number of containers carrying "domestic consumables and copper concentrate" had derailed and 50 metres of track had been washed away.
Copper concentrate is considered a class nine environmentally hazardous substance.
(Sourced from AFP and terradaily.com)
Indian coal imports likely to reach 200 million tonnes by 2017
Wednesday, 28 Dec 2011
ET quoted the government said that India is likely to import 194 million tonnes of coal in 2017 as against 135 million tonnes at present to meet the demand of the power sector.
Mr Pratik Prakashbapu Patil Minister of State for Coal said in a seminar that "Current year, we have to import 135 million tonnes of coal to meet our power sector requirement. The demand will increase further as we are setting up new power plants. It is expected that we will have to import 194 million tonnes of coal in 2017."
The minister also said during the seminar organised by World Confederation Productivity Science (India) and World Academy of Productivity Science that with the passage of time, the country's dependence on imported coal would not come down and would go up instead.
He said that "There will be more dependency on imported coal. The dependency has increased from 6% to 13% in the last five to six years."
As per the Planning Commission, the demand supply gap for coal in the ongoing year is likely to touch 142 million tonnes with domestic availability of only 554 million tonnes against the requirement of 696 million tonnes.
Earlier, the Plan Panel had also said the country coal demand will go up to 1,000 million tonnes by the end of the 12th Five-Year Plan necessitating about 200 million tonnes of imports to bridge the shortfall in domestic output.
According to the Planning Commission unless the widening demand-supply gap for coal was bridged, the projected shortfall of 200 million tonnes would have to be met through imports.
The commission has estimated domestic coal production at 770 million tonnes by 2017 on the basis of projected annual growth of around 7% in output.
As per a Planning Commission document, output in 2011-12 was expected to reach 680 million tonnes but the estimate was later scaled down to 630 MT in a mid-term appraisal by Prime Minister Dr Manmohan Singh.
(Sourced from ET)
ET quoted the government said that India is likely to import 194 million tonnes of coal in 2017 as against 135 million tonnes at present to meet the demand of the power sector.
Mr Pratik Prakashbapu Patil Minister of State for Coal said in a seminar that "Current year, we have to import 135 million tonnes of coal to meet our power sector requirement. The demand will increase further as we are setting up new power plants. It is expected that we will have to import 194 million tonnes of coal in 2017."
The minister also said during the seminar organised by World Confederation Productivity Science (India) and World Academy of Productivity Science that with the passage of time, the country's dependence on imported coal would not come down and would go up instead.
He said that "There will be more dependency on imported coal. The dependency has increased from 6% to 13% in the last five to six years."
As per the Planning Commission, the demand supply gap for coal in the ongoing year is likely to touch 142 million tonnes with domestic availability of only 554 million tonnes against the requirement of 696 million tonnes.
Earlier, the Plan Panel had also said the country coal demand will go up to 1,000 million tonnes by the end of the 12th Five-Year Plan necessitating about 200 million tonnes of imports to bridge the shortfall in domestic output.
According to the Planning Commission unless the widening demand-supply gap for coal was bridged, the projected shortfall of 200 million tonnes would have to be met through imports.
The commission has estimated domestic coal production at 770 million tonnes by 2017 on the basis of projected annual growth of around 7% in output.
As per a Planning Commission document, output in 2011-12 was expected to reach 680 million tonnes but the estimate was later scaled down to 630 MT in a mid-term appraisal by Prime Minister Dr Manmohan Singh.
(Sourced from ET)
Indonesian mineral export tax plan greeted with praise and criticism
Wed, 28 Dec 2011
The Jakarta Post reported that both praise and criticism showered the government’s plan to tax the export of minerals and base metals starting next year.Economists say such an initiative is a testament to the government’s long-term economic vision, in which local manufacturers are encouraged to add value to commodities, as well as contributing to national energy security.
For local miners, on the other hand, the upcoming export tax would be an additional burden that could affect their financial performance amid global economic uncertainties that could jeopardize future expansion plans. Mr Arif Hadianto a spokesperson for Indonesia fifth largest coal miner, PT Berau Coal Energy said coal producers already paid 13.5% of their total sales as royalties to the government, on top of the income and value-added taxes.
He said that “A new tax would automatically be a burden. The government must take into account that coal producers have an obligation to meet domestic demand.”
Separately, Resource Alam Indonesia head of investor relations Mr Erif Tirtana said small and medium-sized companies would be hurt most by the tax plan. He said that “The export tax will be a double tax, as we are already paying royalties. I just hope that the ministry will consider our grievances.”
Mr Bimo Budi Satriyo PT Antam corporate secretary said that the export tax would reduce his company profits. Bimo said that Antam which exports nickel to China, Korea and Europe had to give 5% off its sales prices per ton of high calorie nickel ore and 4% for every ton of low calorie nickel ore in royalty fees.
He said that “We still don’t know what the regulation will look like. As long as the government considers the royalty we are already paying. It will be okay.”
Mr Irwandi Arif Association of Indonesian Mining Professional chairman said that the government should calculate the amount of export tax to help companies maintain their profits. He said, the tax should be re-distributed to develop industry in the country.
He added that “The export tax should be used to provide incentives in development of coal-powered power plants for example in Mulut Tambang. It would be troublesome if the government fails to synchronize the use of the tax.”
The tax plan was first introduced last week by Industry Minister Mr Mohamad S Hidayat who said that the ministry was preparing the export tax on mineral products to encourage the development of derivatives products from minerals and base metals by local industries.
Mr Hidayat said the regulation was poised to be implemented in the first half of 2012, pending approval from the Finance Ministry. He said that “The growth of the downstream industry will create jobs, add value to our products and reduce dependence on imports. He promised that investors who invested in downstream industries would be given tax holidays.”
The planned export tax is in line with the ongoing process carried out by the Energy and Mineral Resources Ministry, which is drafting a regulation that will ban exports of raw mining products beginning in 2014. Prohibiting exports of raw mining product is a part of the government commitment to fully implement the 2009 Mineral and Coal Law, requiring miners to process coal and mineral into added-value products before exporting them.
(Sourced from www.thejakartapost.com)
The Jakarta Post reported that both praise and criticism showered the government’s plan to tax the export of minerals and base metals starting next year.Economists say such an initiative is a testament to the government’s long-term economic vision, in which local manufacturers are encouraged to add value to commodities, as well as contributing to national energy security.
For local miners, on the other hand, the upcoming export tax would be an additional burden that could affect their financial performance amid global economic uncertainties that could jeopardize future expansion plans. Mr Arif Hadianto a spokesperson for Indonesia fifth largest coal miner, PT Berau Coal Energy said coal producers already paid 13.5% of their total sales as royalties to the government, on top of the income and value-added taxes.
He said that “A new tax would automatically be a burden. The government must take into account that coal producers have an obligation to meet domestic demand.”
Separately, Resource Alam Indonesia head of investor relations Mr Erif Tirtana said small and medium-sized companies would be hurt most by the tax plan. He said that “The export tax will be a double tax, as we are already paying royalties. I just hope that the ministry will consider our grievances.”
Mr Bimo Budi Satriyo PT Antam corporate secretary said that the export tax would reduce his company profits. Bimo said that Antam which exports nickel to China, Korea and Europe had to give 5% off its sales prices per ton of high calorie nickel ore and 4% for every ton of low calorie nickel ore in royalty fees.
He said that “We still don’t know what the regulation will look like. As long as the government considers the royalty we are already paying. It will be okay.”
Mr Irwandi Arif Association of Indonesian Mining Professional chairman said that the government should calculate the amount of export tax to help companies maintain their profits. He said, the tax should be re-distributed to develop industry in the country.
He added that “The export tax should be used to provide incentives in development of coal-powered power plants for example in Mulut Tambang. It would be troublesome if the government fails to synchronize the use of the tax.”
The tax plan was first introduced last week by Industry Minister Mr Mohamad S Hidayat who said that the ministry was preparing the export tax on mineral products to encourage the development of derivatives products from minerals and base metals by local industries.
Mr Hidayat said the regulation was poised to be implemented in the first half of 2012, pending approval from the Finance Ministry. He said that “The growth of the downstream industry will create jobs, add value to our products and reduce dependence on imports. He promised that investors who invested in downstream industries would be given tax holidays.”
The planned export tax is in line with the ongoing process carried out by the Energy and Mineral Resources Ministry, which is drafting a regulation that will ban exports of raw mining products beginning in 2014. Prohibiting exports of raw mining product is a part of the government commitment to fully implement the 2009 Mineral and Coal Law, requiring miners to process coal and mineral into added-value products before exporting them.
(Sourced from www.thejakartapost.com)
Tuesday, December 27, 2011
Coal shipment of Tianjin Port reached 6.72 Million tonnes in November'2011
Tue, December27, 2011
Tianjin port shipped 6.72 million tonnes of coal in November, decreasing 600,000 tonnes versus 7.32 million tonnes in October, while up 21.09% or 1.17 million tonnes from a year earlier.
Coal shipment in the first eleven months totaled 77.44 million tonnes, surging 30.7% or 18.17 million tonnes compared with the same period last year and 13 million tonnes more than the port's total shipment of 64.48 million tonnes in 2010.
Tianjin port has 16 coal-handling berths, with an annual throughput capacity of 85 million tonnes.
(source:Steel Home,Hellenic Shipping)
Tianjin port shipped 6.72 million tonnes of coal in November, decreasing 600,000 tonnes versus 7.32 million tonnes in October, while up 21.09% or 1.17 million tonnes from a year earlier.
Coal shipment in the first eleven months totaled 77.44 million tonnes, surging 30.7% or 18.17 million tonnes compared with the same period last year and 13 million tonnes more than the port's total shipment of 64.48 million tonnes in 2010.
Tianjin port has 16 coal-handling berths, with an annual throughput capacity of 85 million tonnes.
(source:Steel Home,Hellenic Shipping)
Miners make case for resuming contract negotiations
Tue, December27, 2011
The Jakarta Post reported that, problems with the renegotiation of mining contracts in the country are far from over, as agreements on several crucial issues are still yet to be found.
The government remains adamant that it will not compromise on its intention to ramp up state revenues by increasing royalties, while miners on the other hand insist that some points in the 2009 minerals and coal law are “irrational” and may create uncertainty in terms of the outcome of their investments.
The Indonesian Mining Association (IMA) revealed that renegotiations had stalled due to three major issues: the size of mining areas, state revenues and contract extensions. In a bid to make progress on the stagnant talks between the government and miners, the association proposed solutions to the three issues based on what it saw as fair for both parties. With the proposals, it expected that deals would be made, which would foster an air of certainty in relation to operations.
On the issue of state revenues, the association claimed that it was hard for mining companies to adjust the amount of royalties to the level set by the government in the 2003 regulation on tariffs for non-tax revenues for the energy and mineral resources sector (3.75 percent of sales for gold, 3.25 percent for silver and 4 percent for copper). “If the government wants to raise royalties, it also has to think about other financial obligations paid by companies, such as the corporate income tax, the amount of which is still 35 percent even though the 2008 law on income tax revised it to 25 percent,” said Syahrir AB, an executive director of the IMA, in Jakarta on Monday.
The government could not force mining companies to pay higher royalties without adjusting its other financial obligations because such economic burdens would reduce the profitability of their projects, he explained. If the goal was to raise state revenues from the mining sector, he suggested that the government apply a threshold for mining companies’ profits. For example, if a company made a profit margin of more than 25 percent due to the soaring prices of commodities, the government could apply an additional tax, he added.
The second suggestion was related to the size of mining areas. The association said most mining companies needed at least 70,000 hectares to make a mining project “economical”. However, the 2009 law on minerals and coal determined that the maximum size for mineral mining was 25,000 hectares, with coal mining at 15,000 hectares.
“In our last meeting with the government, it understood our reasons. The government agreed that the size of an area granted to a company would be judged based on the long-term plan it proposed to the government,” Syahrir reported. That model requires the Energy and Mineral Resources Ministry to have the human resources to review the plan and judge whether the size of area proposed by a company is reasonable or not. If the reviewers say that the proposal is unreasonable, the government can grant the permit for a smaller area.
The third suggestion was about the contract extension. Currently, mining companies can extend the contract by “two times 10 years”, but the authority to grant approval for the extension is in the hands of the head of regions by issuing mining permits. The association deems that the model creates uncertainty over the future of mining projects. It suggests that the contract extension clause is included into mining contracts (KK) and contracts of work (PKP2B).
The director general for minerals and coal at the Energy and Mineral Resources Ministry, Thamrin Sihite, said that out of 42 mining contract holders and 76 contracts of work, there were companies that agreed to all renegotiation points, and some that partially agreed and disagreed.
“About the suggestion in relation to the size of area, the government will review it first, if the proposal is in line with the government vision, we may approve it,” he said over the phone. However, he reminded that renegotiations had to be looked at on case by case basis as each company had different problems.
IMA proposals:
•The implementation of a profit threshold to allow the government to tax mining companies if the latter’s profit margins exceed the threshold.
•Determine the mining area based on the profitability of each mining project. The IMA estimates that a company needs at least 70,000 hectares to make a project profitable.
•Contract extensions have to be included into mining contracts (KK) and contracts of work (PKP2B) to create certainty. ( source The Jakarta Post)
The Jakarta Post reported that, problems with the renegotiation of mining contracts in the country are far from over, as agreements on several crucial issues are still yet to be found.
The government remains adamant that it will not compromise on its intention to ramp up state revenues by increasing royalties, while miners on the other hand insist that some points in the 2009 minerals and coal law are “irrational” and may create uncertainty in terms of the outcome of their investments.
The Indonesian Mining Association (IMA) revealed that renegotiations had stalled due to three major issues: the size of mining areas, state revenues and contract extensions. In a bid to make progress on the stagnant talks between the government and miners, the association proposed solutions to the three issues based on what it saw as fair for both parties. With the proposals, it expected that deals would be made, which would foster an air of certainty in relation to operations.
On the issue of state revenues, the association claimed that it was hard for mining companies to adjust the amount of royalties to the level set by the government in the 2003 regulation on tariffs for non-tax revenues for the energy and mineral resources sector (3.75 percent of sales for gold, 3.25 percent for silver and 4 percent for copper). “If the government wants to raise royalties, it also has to think about other financial obligations paid by companies, such as the corporate income tax, the amount of which is still 35 percent even though the 2008 law on income tax revised it to 25 percent,” said Syahrir AB, an executive director of the IMA, in Jakarta on Monday.
The government could not force mining companies to pay higher royalties without adjusting its other financial obligations because such economic burdens would reduce the profitability of their projects, he explained. If the goal was to raise state revenues from the mining sector, he suggested that the government apply a threshold for mining companies’ profits. For example, if a company made a profit margin of more than 25 percent due to the soaring prices of commodities, the government could apply an additional tax, he added.
The second suggestion was related to the size of mining areas. The association said most mining companies needed at least 70,000 hectares to make a mining project “economical”. However, the 2009 law on minerals and coal determined that the maximum size for mineral mining was 25,000 hectares, with coal mining at 15,000 hectares.
“In our last meeting with the government, it understood our reasons. The government agreed that the size of an area granted to a company would be judged based on the long-term plan it proposed to the government,” Syahrir reported. That model requires the Energy and Mineral Resources Ministry to have the human resources to review the plan and judge whether the size of area proposed by a company is reasonable or not. If the reviewers say that the proposal is unreasonable, the government can grant the permit for a smaller area.
The third suggestion was about the contract extension. Currently, mining companies can extend the contract by “two times 10 years”, but the authority to grant approval for the extension is in the hands of the head of regions by issuing mining permits. The association deems that the model creates uncertainty over the future of mining projects. It suggests that the contract extension clause is included into mining contracts (KK) and contracts of work (PKP2B).
The director general for minerals and coal at the Energy and Mineral Resources Ministry, Thamrin Sihite, said that out of 42 mining contract holders and 76 contracts of work, there were companies that agreed to all renegotiation points, and some that partially agreed and disagreed.
“About the suggestion in relation to the size of area, the government will review it first, if the proposal is in line with the government vision, we may approve it,” he said over the phone. However, he reminded that renegotiations had to be looked at on case by case basis as each company had different problems.
IMA proposals:
•The implementation of a profit threshold to allow the government to tax mining companies if the latter’s profit margins exceed the threshold.
•Determine the mining area based on the profitability of each mining project. The IMA estimates that a company needs at least 70,000 hectares to make a project profitable.
•Contract extensions have to be included into mining contracts (KK) and contracts of work (PKP2B) to create certainty. ( source The Jakarta Post)
Earnings of smallest bulkers fall to lowest in 33 months
Tuesday, 27 Dec 2011
It is reported that earnings from the world’s smallest commodity ships fell to the lowest level in almost three years as the vessels miss out on a boom in Chinese iron ore demand that buoyed rates for larger carriers.
According to the data from the Baltic Exchange in London Hire costs for Handysizes that haul at most 35,000 tonnes of cargo slid for a 22nd day declining USD 2 to USD 8,389 a day. The ships which move cargoes from grains to lumber are down 31% this year compared with a 57% rally in rates for Capesize carriers that are at least four times bigger and transport iron ore.
Mr Jeffrey Landsberg president of Commodore Research in New York said “China is taking a large amount of iron ore even though the world is still going through significant economic trouble. Handysizes are more susceptible to changes in the developed world.”
According to ship-tracking data compiled by Bloomberg for carriers signaling arrival dates within the next month that 10% of the global fleet of Handysizes is bound for the Asian country compared with 21% of Capesizes. Almost half of the Capesize fleet is sailing for China or for Australia or Brazil, the two largest iron ore exporters compared with 18% of Handysizes.
According to economists’ forecasts compiled by Bloomberg and data from Clarkson Research Services Ltd a unit of the world largest shipbroker China, growing more than three times faster than the global average will import 10% more of the ingredient used in steelmaking this year. While that bolsters demand for both Capesize and Handysizes vessels, the smaller ships have a wider cargo mix, meaning they benefit less.
(Sourced from www.mb.com.ph)
It is reported that earnings from the world’s smallest commodity ships fell to the lowest level in almost three years as the vessels miss out on a boom in Chinese iron ore demand that buoyed rates for larger carriers.
According to the data from the Baltic Exchange in London Hire costs for Handysizes that haul at most 35,000 tonnes of cargo slid for a 22nd day declining USD 2 to USD 8,389 a day. The ships which move cargoes from grains to lumber are down 31% this year compared with a 57% rally in rates for Capesize carriers that are at least four times bigger and transport iron ore.
Mr Jeffrey Landsberg president of Commodore Research in New York said “China is taking a large amount of iron ore even though the world is still going through significant economic trouble. Handysizes are more susceptible to changes in the developed world.”
According to ship-tracking data compiled by Bloomberg for carriers signaling arrival dates within the next month that 10% of the global fleet of Handysizes is bound for the Asian country compared with 21% of Capesizes. Almost half of the Capesize fleet is sailing for China or for Australia or Brazil, the two largest iron ore exporters compared with 18% of Handysizes.
According to economists’ forecasts compiled by Bloomberg and data from Clarkson Research Services Ltd a unit of the world largest shipbroker China, growing more than three times faster than the global average will import 10% more of the ingredient used in steelmaking this year. While that bolsters demand for both Capesize and Handysizes vessels, the smaller ships have a wider cargo mix, meaning they benefit less.
(Sourced from www.mb.com.ph)
Legacy Iron Ore to acquire 60% of Hawthorn Resources
Tuesday, December 27, 2011 sourced: Proactive Investors
Legacy Iron Ore (ASX:LCY) will acquire a 60 per cent stake in Hawthorn Resources (ASX:HAW) and so enable the Mt Bevan iron ore joint venture in Western Australia to be developed under one entity.
Investors may recall that India's NMDC, the largest iron ore producer and a Government of India owned enterprise, committed to developing Mt Bevan through Legacy. NMDC has cash reserves of A$4 billion.
Legacy and Hawthorn signed a term sheet for the deal which is expected to be finalised following an upgrade to the current inferred resource at Mt Bevan, which is likely to be announced in mid-January 2012.
Key deal points are:
- Legacy agreeing to subscribe for a placement of $5,000,000 at an issue price of $0.015 in Hawthorn, being a premium over the last ASX trade of $0.009, upon completion of the transaction.
- Hawthorn agreeing to acquire the interest currently being earned in the Mt Bevan project by Legacy, and agreeing to terminate the Joint Venture agreement, in return for scrip consideration in Hawthorn.
- Upon completion, 100% of Mt Bevan will remain in Hawthorn for development and commercialisation
- Legacy will have the right to appoint a majority of directors to the Hawthorn board
The deal is subject to the completion of satisfactory due diligence by Legacy, and obtaining the necessary regulatory and shareholder approvals.
The $5m placement into Hawthorn will be funded by Legacy, out of current cash reserves. Legacy shareholders recently approved an $18.9m placement to NMDC for 50 per cent of Legacy. Three NMDC directors have joined the Legacy board including NMDC chairman Rana Som.
Australia’s Foreign Investment Review Board (FIRB) as well as the Legacy shareholders have given their approval to the NMDC-Legacy deal.
Analysis
Clearly, this is a significant step forward for Legacy and allowing an accelerated development of Mt Bevan, as this deal paves the way for effective control of Mt Bevan to reside with Legacy. It would also have likely been a key point for NMDC to open its wallet further with project financing and access to debt funding of Mt Bevan.
In a plus for Legacy shareholders, subject to successful completion, Legacy is likely to look to an in-specie distribution of the 60% shareholding in Hawthorn back to Legacy shareholders.
Legacy and NMDC are on record as seeking to secure additional resource projects using Legacy as its investment vehicle. Sources in India told Proactive Investors that high on NMDC's list is to acquire a stake of up to 50 per cent stake in phosphate company Minemakers (ASX: MAK) and its Wonarah phosphate project. This could occur as soon as the Legacy deal is wrapped up. However, it is understood that due diligence has not yet been completed on the Wonarah project.
NMDC has put aside up to $400 million for overseas investments like Legacy and Minemakers.
Legacy Iron Ore (ASX:LCY) will acquire a 60 per cent stake in Hawthorn Resources (ASX:HAW) and so enable the Mt Bevan iron ore joint venture in Western Australia to be developed under one entity.
Investors may recall that India's NMDC, the largest iron ore producer and a Government of India owned enterprise, committed to developing Mt Bevan through Legacy. NMDC has cash reserves of A$4 billion.
Legacy and Hawthorn signed a term sheet for the deal which is expected to be finalised following an upgrade to the current inferred resource at Mt Bevan, which is likely to be announced in mid-January 2012.
Key deal points are:
- Legacy agreeing to subscribe for a placement of $5,000,000 at an issue price of $0.015 in Hawthorn, being a premium over the last ASX trade of $0.009, upon completion of the transaction.
- Hawthorn agreeing to acquire the interest currently being earned in the Mt Bevan project by Legacy, and agreeing to terminate the Joint Venture agreement, in return for scrip consideration in Hawthorn.
- Upon completion, 100% of Mt Bevan will remain in Hawthorn for development and commercialisation
- Legacy will have the right to appoint a majority of directors to the Hawthorn board
The deal is subject to the completion of satisfactory due diligence by Legacy, and obtaining the necessary regulatory and shareholder approvals.
The $5m placement into Hawthorn will be funded by Legacy, out of current cash reserves. Legacy shareholders recently approved an $18.9m placement to NMDC for 50 per cent of Legacy. Three NMDC directors have joined the Legacy board including NMDC chairman Rana Som.
Australia’s Foreign Investment Review Board (FIRB) as well as the Legacy shareholders have given their approval to the NMDC-Legacy deal.
Analysis
Clearly, this is a significant step forward for Legacy and allowing an accelerated development of Mt Bevan, as this deal paves the way for effective control of Mt Bevan to reside with Legacy. It would also have likely been a key point for NMDC to open its wallet further with project financing and access to debt funding of Mt Bevan.
In a plus for Legacy shareholders, subject to successful completion, Legacy is likely to look to an in-specie distribution of the 60% shareholding in Hawthorn back to Legacy shareholders.
Legacy and NMDC are on record as seeking to secure additional resource projects using Legacy as its investment vehicle. Sources in India told Proactive Investors that high on NMDC's list is to acquire a stake of up to 50 per cent stake in phosphate company Minemakers (ASX: MAK) and its Wonarah phosphate project. This could occur as soon as the Legacy deal is wrapped up. However, it is understood that due diligence has not yet been completed on the Wonarah project.
NMDC has put aside up to $400 million for overseas investments like Legacy and Minemakers.
Indian steel ministry seeks decision to stop NMDC iron ore
Tuesday, 27 Dec 2011
The Indian Express reported that armed with the CAG’s observations that NMDC’s iron ore exports to Japanese Steel Mills and South Korea was needless in view of growing domestic demand, the Indian steel ministry has decided to ask the union cabinet to reconsider its decision on mandating NMDC to export the mineral.
The official quoted the Chattisgarh chief minister as saying that “The chief minister said if NMDC had not exported ore to these two nations, at least 3 million tonne of additional iron ore would have been available to the state’s ore-starved sponge iron units.”
The official said that “Actually, we also have been opposing these exports from the beginning and had already conveyed our concerns to the commerce ministry, at whose behest the cabinet had okayed NMDC’s continuation of exports (till 2014). We will tell firmly that exports to these two nations are unsustainable at long term prices as it amounted to subsidizing their steel production.”
The official added that “We have decided to approach the Union Cabinet soon to re consider its decision to mandate NMDC to renew its long-term agreements with these two nations, which is bereft of any logic.”
The Comptroller and Auditor General in its recent observations to the steel ministry, had said that NMDC has been mandated to exports iron ore to Japanese steel mills and South Korea but made to overlook the domestic demand for the mineral. The CAG has questioned the mandate.
The move also comes close on the heels of the I-T department who hit out the Navratna company for losing substantial revenues by exporting to Japanese steel mills on long term prices and not through a more viable spot prices. A senior steel ministry official told The Indian Express that “The Income Tax Department has also questioned NMDC’s exports to these two countries on long term prices. It says the PSU has incurred substantial financial losses by not selling the mineral on spot prices.”
(Sourced from www.indianexpress.com)
The Indian Express reported that armed with the CAG’s observations that NMDC’s iron ore exports to Japanese Steel Mills and South Korea was needless in view of growing domestic demand, the Indian steel ministry has decided to ask the union cabinet to reconsider its decision on mandating NMDC to export the mineral.
The official quoted the Chattisgarh chief minister as saying that “The chief minister said if NMDC had not exported ore to these two nations, at least 3 million tonne of additional iron ore would have been available to the state’s ore-starved sponge iron units.”
The official said that “Actually, we also have been opposing these exports from the beginning and had already conveyed our concerns to the commerce ministry, at whose behest the cabinet had okayed NMDC’s continuation of exports (till 2014). We will tell firmly that exports to these two nations are unsustainable at long term prices as it amounted to subsidizing their steel production.”
The official added that “We have decided to approach the Union Cabinet soon to re consider its decision to mandate NMDC to renew its long-term agreements with these two nations, which is bereft of any logic.”
The Comptroller and Auditor General in its recent observations to the steel ministry, had said that NMDC has been mandated to exports iron ore to Japanese steel mills and South Korea but made to overlook the domestic demand for the mineral. The CAG has questioned the mandate.
The move also comes close on the heels of the I-T department who hit out the Navratna company for losing substantial revenues by exporting to Japanese steel mills on long term prices and not through a more viable spot prices. A senior steel ministry official told The Indian Express that “The Income Tax Department has also questioned NMDC’s exports to these two countries on long term prices. It says the PSU has incurred substantial financial losses by not selling the mineral on spot prices.”
(Sourced from www.indianexpress.com)
Mongolian Coal merger and acquisition still hot to trot
Tue, Dec27, 2011
It is reported that the stampede of coal M&A isn’t slowing down in the land of Genghis Khan. After successful buyouts of Hunnu Coal and QGX coking coal assets over the past six months, the latest company with Mongolian coal deposits to move into the crosshairs of acquirers is Guildford Coal Terra Energy unit. Newcastle based Guildford Coal originally planned to list Terra Energy, which is expected to produce its first coal from the South Gobi project in Mongolia in the first half of next year, on the Australian Securities Exchange and hired UBS to advise on the process.
A float in the second quarter of 2012 remains under consideration. However, Guildford Coal is having its head turned by expressions of interest from parties looking to acquire some or its entire 70% stake in Terra Energy. Mr Craig Ransley Guildford Coal’s non-executive chairman declining to identify the parties said “It’s from global players and we’ve had a lot of interest. They are being evaluated.”
He said that “There is a lot of others that have talked a lot of talk, but they are hundreds or thousands of kilometers away from the border. We’re the only ones that are close to actually producing, so I expect that interest will probably ramp up once the mining licenses are granted. We’ll be the only junior in Mongolia that will actually be mining.” Mongolia, together with the southern African nation of Mozambique, has become a hotspot for investors seeking to unlock new deposits of coking coal that can be exported to steel mills in Asia. The country biggest coking coal development the Tavan Tolgoi project is being circled by many of the world biggest miners including Peabody Energy of the US and China Shenhua.
However, developing many of the biggest coal deposits in Mongolia is expensive and technically challenging as they are located far from railroads that can bring in heavy mining equipment and provide an export route for the coal. Terra Energy resource is located around 30 miles east of two operating mines, including one owned by Hong Kong-listed SouthGobi Resources, producing a combined 5 million tons of coal annually that is sold to customers in northern China’s Gansu and Shanxi provinces and Inner Mongolia region.
Guildford Coal says a mine with an annual production capacity 1 million tonnes to 2 million tons of coal could be built at the South Gobi development site. It would produce a mix of coking coal, used in steelmaking and thermal coal for power generation.
(Sourced from The Wall Street Journal)
It is reported that the stampede of coal M&A isn’t slowing down in the land of Genghis Khan. After successful buyouts of Hunnu Coal and QGX coking coal assets over the past six months, the latest company with Mongolian coal deposits to move into the crosshairs of acquirers is Guildford Coal Terra Energy unit. Newcastle based Guildford Coal originally planned to list Terra Energy, which is expected to produce its first coal from the South Gobi project in Mongolia in the first half of next year, on the Australian Securities Exchange and hired UBS to advise on the process.
A float in the second quarter of 2012 remains under consideration. However, Guildford Coal is having its head turned by expressions of interest from parties looking to acquire some or its entire 70% stake in Terra Energy. Mr Craig Ransley Guildford Coal’s non-executive chairman declining to identify the parties said “It’s from global players and we’ve had a lot of interest. They are being evaluated.”
He said that “There is a lot of others that have talked a lot of talk, but they are hundreds or thousands of kilometers away from the border. We’re the only ones that are close to actually producing, so I expect that interest will probably ramp up once the mining licenses are granted. We’ll be the only junior in Mongolia that will actually be mining.” Mongolia, together with the southern African nation of Mozambique, has become a hotspot for investors seeking to unlock new deposits of coking coal that can be exported to steel mills in Asia. The country biggest coking coal development the Tavan Tolgoi project is being circled by many of the world biggest miners including Peabody Energy of the US and China Shenhua.
However, developing many of the biggest coal deposits in Mongolia is expensive and technically challenging as they are located far from railroads that can bring in heavy mining equipment and provide an export route for the coal. Terra Energy resource is located around 30 miles east of two operating mines, including one owned by Hong Kong-listed SouthGobi Resources, producing a combined 5 million tons of coal annually that is sold to customers in northern China’s Gansu and Shanxi provinces and Inner Mongolia region.
Guildford Coal says a mine with an annual production capacity 1 million tonnes to 2 million tons of coal could be built at the South Gobi development site. It would produce a mix of coking coal, used in steelmaking and thermal coal for power generation.
(Sourced from The Wall Street Journal)
Bolivia provides armed forces with barges to transport iron ore
Tue, Dec27, 2011
Business News Americas reported in early December that the Bolivian government has equipped the armed forces with barges to help export iron ore from Santa Cruz department's El Mutún deposit.
A sector executive told BNamericas “There is a decree under which the armed forces will undertake 30% of transport so they can help export the iron ore via the Paraguay Paraná waterway to the Atlantic ocean.”
The government gave the armed forces two trawlers and 16 barges that can move up to 2,500 tonnes.
However, some infrastructure works still need to be completed, according to the executive, and they need to organize return cargo so they are not just exporting but also importing.
Iron ore exports from El Mutún are currently suspended due to the low level of the Paraguay River and will not resume until next year.
At the beginning of October, state steel company ESM sent the first 10,000 tonnes of iron ore to Paraguayan steelmaker Acepar as part of a USD 6 million sales contract for 140,000 tonnes.
(Sourced from Business News Americas)
Business News Americas reported in early December that the Bolivian government has equipped the armed forces with barges to help export iron ore from Santa Cruz department's El Mutún deposit.
A sector executive told BNamericas “There is a decree under which the armed forces will undertake 30% of transport so they can help export the iron ore via the Paraguay Paraná waterway to the Atlantic ocean.”
The government gave the armed forces two trawlers and 16 barges that can move up to 2,500 tonnes.
However, some infrastructure works still need to be completed, according to the executive, and they need to organize return cargo so they are not just exporting but also importing.
Iron ore exports from El Mutún are currently suspended due to the low level of the Paraguay River and will not resume until next year.
At the beginning of October, state steel company ESM sent the first 10,000 tonnes of iron ore to Paraguayan steelmaker Acepar as part of a USD 6 million sales contract for 140,000 tonnes.
(Sourced from Business News Americas)
Tender; NTPC to invite Expressions of Interest for coal import
Tuesday, Dec27, 2011
KOLKATA: NTPC will invite expressions of interest next month for importing coal on a 10-15 years contract from foreign coal producers, chairman Arup Roy Choudhury said. The largest power generator hopes to start imports within the next financial year and will start with about 16 million tonnes. "To begin with, we will import about 15-16 million tonnes of coal through long-term contracts that we are planning to strike with overseas coal suppliers. This volume will increase gradually to about 24 million tonnes in the next few years as our requirement for coal increases," Roy Choudhury said.
"At present we require about 160 million tonnes of coal per year. This year we are importing about 16 million tonnes from the international spot market. However, as our capacity increases over the next couple of years, our requirement is expected to touch 240 million tonnes in the short run. The plan is to import at least 10% of our coal requirement through this contract," he said. Striking long-term import contract will help NTPC source coal at a price which is less than spot market prices.
It will also offer the company some sort of hedge against coal price fluctuation in the short term. This initiative will, however, go in tandem with its effort to acquire coal bearing assets in foreign countries. Coal India had also taken up a similar initiative where it intended to enter into 10-year contract with overseas suppliers for importing coal at a discount over spot market prices.
NTPC was one of the interested consumers and it wanted to take about 10 million tonnes of coal imported by Coal India. However, CIL's initiative did not yield much result as the prices offered by overseas companies turned out to be higher than spot prices. This forced CIL to put this venture on the back burner. "We had shown interest in sourcing coal from Coal India, but they did not get back to us with the final prices and other required details. Nevertheless, as CIL did not turn up, we have now decided to take up the initiative on our own although we would still want CIL to import coal for us," Roy Choudhury said.
"We would like to source around 70 % of our coal requirements from Coal India, 20% from our captive mines and about 10 % from imports. The mines we have been allotted has a reserve of 1.8 billion tonnes and production from some of these will start soon," Roy Choudhury said.
(sourced ET)
KOLKATA: NTPC will invite expressions of interest next month for importing coal on a 10-15 years contract from foreign coal producers, chairman Arup Roy Choudhury said. The largest power generator hopes to start imports within the next financial year and will start with about 16 million tonnes. "To begin with, we will import about 15-16 million tonnes of coal through long-term contracts that we are planning to strike with overseas coal suppliers. This volume will increase gradually to about 24 million tonnes in the next few years as our requirement for coal increases," Roy Choudhury said.
"At present we require about 160 million tonnes of coal per year. This year we are importing about 16 million tonnes from the international spot market. However, as our capacity increases over the next couple of years, our requirement is expected to touch 240 million tonnes in the short run. The plan is to import at least 10% of our coal requirement through this contract," he said. Striking long-term import contract will help NTPC source coal at a price which is less than spot market prices.
It will also offer the company some sort of hedge against coal price fluctuation in the short term. This initiative will, however, go in tandem with its effort to acquire coal bearing assets in foreign countries. Coal India had also taken up a similar initiative where it intended to enter into 10-year contract with overseas suppliers for importing coal at a discount over spot market prices.
NTPC was one of the interested consumers and it wanted to take about 10 million tonnes of coal imported by Coal India. However, CIL's initiative did not yield much result as the prices offered by overseas companies turned out to be higher than spot prices. This forced CIL to put this venture on the back burner. "We had shown interest in sourcing coal from Coal India, but they did not get back to us with the final prices and other required details. Nevertheless, as CIL did not turn up, we have now decided to take up the initiative on our own although we would still want CIL to import coal for us," Roy Choudhury said.
"We would like to source around 70 % of our coal requirements from Coal India, 20% from our captive mines and about 10 % from imports. The mines we have been allotted has a reserve of 1.8 billion tonnes and production from some of these will start soon," Roy Choudhury said.
(sourced ET)
Iron ore spot prices unchanged and deals slow
Tuesday, 27 Dec 2011
Reuters reported that spot iron ore prices are expected to remain flat or dip this week after last week gains as steel mills end a brief restocking period.
Iron ore suppliers have also suspended offers during the Christmas holiday season, with steel mills in top buyer China still worried about the state of the market in the New Year.
An iron ore trader in the eastern coastal province of Shandong said "I see mounting pressures on iron ore prices as spot billet prices continue to fall in Hebei because of rapidly shrinking demand, and we have received fewer offers due to the Christmas holiday."
Chinese steel mills boosted stockpiles of the raw material in the week before Christmas, picking up bargains as prices fell to around USD 130 per tonne.
Chinese consultancy Umetal said Pilbara fines with 61.5% iron content were being offered at USD 135 per tonne to USD 138 per tonne on Monday including cost and freight unchanged for the third consecutive day.
Metal Bulletin Iron Ore Index said in a Friday note that "We expect to hear fewer deals next week due to the Christmas holiday period."
It said "Prior to the Chinese new year holiday during the last week of January we expect to see rises as mills look to cover production during this time. This expectation is likely to provide upward pressure over the next few weeks as mills see the stability in the spot price as a good chance to buy material."
(Sourced from Reuters)
Reuters reported that spot iron ore prices are expected to remain flat or dip this week after last week gains as steel mills end a brief restocking period.
Iron ore suppliers have also suspended offers during the Christmas holiday season, with steel mills in top buyer China still worried about the state of the market in the New Year.
An iron ore trader in the eastern coastal province of Shandong said "I see mounting pressures on iron ore prices as spot billet prices continue to fall in Hebei because of rapidly shrinking demand, and we have received fewer offers due to the Christmas holiday."
Chinese steel mills boosted stockpiles of the raw material in the week before Christmas, picking up bargains as prices fell to around USD 130 per tonne.
Chinese consultancy Umetal said Pilbara fines with 61.5% iron content were being offered at USD 135 per tonne to USD 138 per tonne on Monday including cost and freight unchanged for the third consecutive day.
Metal Bulletin Iron Ore Index said in a Friday note that "We expect to hear fewer deals next week due to the Christmas holiday period."
It said "Prior to the Chinese new year holiday during the last week of January we expect to see rises as mills look to cover production during this time. This expectation is likely to provide upward pressure over the next few weeks as mills see the stability in the spot price as a good chance to buy material."
(Sourced from Reuters)
Monday, December 26, 2011
Adani Enterprises floats global tender for logistic services
Monday, Dec26, 2011
NEW DELHI: Adani Enterprises Ltd (AEL) has floated international tender for selecting a logistics service provider, who would be responsible for delivery of coal to various thermal power plants. "AEL hereby invites interested parties to participate in the bidding process for the selection of logistic service provider (LSP), on the basis of international competitive bidding, who will be responsible for...delivery of coal by rail-sea-rail route," according to a public notice today.
Adani Enterprises was appointed as the mine developer and operator for Machhakata coal block in Orissa by Mahaguj Collieries Ltd (MGCL), the joint venture between Maharashtra State Power Generation (MAHAGENCO) and Gujarat State Electricity Cooperation (GSECL).
The firm is also designated with the task of delivery of coal at the thermal power plants of MAHAGENCO and GSECL, the public notice said. "The LSP shall be responsible for all activities related to transportation of coal from AEL's coal washery to thermal power plants, when the coal is to be transported through rail-sea-rail option," it said.
"In addition, the LSP shall also be responsible for obtaining all clearances/approvals, and complying with all requirements of various government/non government agencies related to the scope of work (including approval...required on title of AEL & MGCL," it added.
(sourced ET)
NEW DELHI: Adani Enterprises Ltd (AEL) has floated international tender for selecting a logistics service provider, who would be responsible for delivery of coal to various thermal power plants. "AEL hereby invites interested parties to participate in the bidding process for the selection of logistic service provider (LSP), on the basis of international competitive bidding, who will be responsible for...delivery of coal by rail-sea-rail route," according to a public notice today.
Adani Enterprises was appointed as the mine developer and operator for Machhakata coal block in Orissa by Mahaguj Collieries Ltd (MGCL), the joint venture between Maharashtra State Power Generation (MAHAGENCO) and Gujarat State Electricity Cooperation (GSECL).
The firm is also designated with the task of delivery of coal at the thermal power plants of MAHAGENCO and GSECL, the public notice said. "The LSP shall be responsible for all activities related to transportation of coal from AEL's coal washery to thermal power plants, when the coal is to be transported through rail-sea-rail option," it said.
"In addition, the LSP shall also be responsible for obtaining all clearances/approvals, and complying with all requirements of various government/non government agencies related to the scope of work (including approval...required on title of AEL & MGCL," it added.
(sourced ET)
Coal supply to power stations has increased tremendously: CIL
Monday,Dec26, 2011
NEW DELHI: Dismissing reports that Coal India (CIL) is not dispatching adequate coal to power plants, the public sector firm has claimed that supply of the fossil fuel to power stations has increased 'tremendously'. "If you take the average of October, November and December... the supply (of coal) to power sector has been 95 per cent of our commitment and in December alone, it is 103 per cent of the commitment, so where is the failure of CIL?", CIL Chairman and Managing Director N C Jha said.
Jha was reacting to newspaper reports that claim the company has not been keeping to its supply commitments. "I have read in the newspaper that Coal India in failing to supply coal to the power stations but the fact is exactly reverse. Definitely in the months of August and September, because there was a great depression in our production... the production has depressed and also the supply of coal has depressed," he said.
"This continued till the first half of October... but after the second half, supply to power sector has increased tremendously," he added. "I absolutely do not agree with this (CIL is failing to supply coal to the power stations). Coal India has been endeavouring hard to supply coal to the power sector," Jha said.
The CMD, however, admitted that due to the inadequate dispatch of coal to power stations in the monsoon months, the stock at the power stations has reduced. "But this (coal stock) cannot be made up overnight, but with the passage of time," he added.
"Every year, it is made up between November to March because excessive consumption from the stocks of power plants in the monsoon months gets supplemented through additional supply during these dry months. This is what exactly is happening even now," Jha added.
Last week, Coal Minister Sriprakash Jaiswal had also said there was no crisis at power stations due to short supply of the fossil fuel and assured that no station would be shut down for want of coal. In October, inadequate supply of coal to power stations had resulted in acute power cuts in many parts of the country, including North India.
Subsequently, the government swung into action and asked coal companies, including CIL, to step up supply to stations facing a shortage of the dry fuel. Dispatch of coal to power firms suffered a setback in August and September due to heavy rains in all the coalfields, adversely affecting production and transportation of coal from mines to railway sidings.
(sourced ET)
NEW DELHI: Dismissing reports that Coal India (CIL) is not dispatching adequate coal to power plants, the public sector firm has claimed that supply of the fossil fuel to power stations has increased 'tremendously'. "If you take the average of October, November and December... the supply (of coal) to power sector has been 95 per cent of our commitment and in December alone, it is 103 per cent of the commitment, so where is the failure of CIL?", CIL Chairman and Managing Director N C Jha said.
Jha was reacting to newspaper reports that claim the company has not been keeping to its supply commitments. "I have read in the newspaper that Coal India in failing to supply coal to the power stations but the fact is exactly reverse. Definitely in the months of August and September, because there was a great depression in our production... the production has depressed and also the supply of coal has depressed," he said.
"This continued till the first half of October... but after the second half, supply to power sector has increased tremendously," he added. "I absolutely do not agree with this (CIL is failing to supply coal to the power stations). Coal India has been endeavouring hard to supply coal to the power sector," Jha said.
The CMD, however, admitted that due to the inadequate dispatch of coal to power stations in the monsoon months, the stock at the power stations has reduced. "But this (coal stock) cannot be made up overnight, but with the passage of time," he added.
"Every year, it is made up between November to March because excessive consumption from the stocks of power plants in the monsoon months gets supplemented through additional supply during these dry months. This is what exactly is happening even now," Jha added.
Last week, Coal Minister Sriprakash Jaiswal had also said there was no crisis at power stations due to short supply of the fossil fuel and assured that no station would be shut down for want of coal. In October, inadequate supply of coal to power stations had resulted in acute power cuts in many parts of the country, including North India.
Subsequently, the government swung into action and asked coal companies, including CIL, to step up supply to stations facing a shortage of the dry fuel. Dispatch of coal to power firms suffered a setback in August and September due to heavy rains in all the coalfields, adversely affecting production and transportation of coal from mines to railway sidings.
(sourced ET)
Iron Ore-Spot prices unchanged, deals slow
Monday, December26, 2011
Shanghai(Reuters) - Spot iron ore prices are expected to remain flat or dip this week, after last week's gains, as steel mills end a brief restocking period. Iron ore suppliers have also suspended offers during the Christmas holiday season, with steel mills in top buyer China still worried about the state of the market in the new year.
"I see mounting pressures on iron ore prices as spot billet prices continue to fall in Hebei because of rapidly shrinking demand, and we have received fewer offers due to the Christmas holiday," said an iron ore trader in the eastern coastal province of Shandong. Chinese steel mills boosted stockpiles of the raw material in the week before Christmas, picking up bargains as prices fell to around $130 per tonne.
Pilbara fines with 61.5 percent iron content were being offered at $135-138 per tonne on Monday including cost and freight, unchanged for the third consecutive day, Chinese consultancy Umetal said. "We expect to hear fewer deals next week due to the Christmans holiday period," Metal Bulletin Iron Ore Index said in a Friday note.
"Prior to the Chinese new year holiday during the last week of January we expect to see rises as mills look to cover production during this time. This expectation is likely to provide upward pressure over the next few weeks as mills see the stability in the spot price as a good chance to buy material." Iron ore with 62 percent Fe grade rose to $135.7 per tonne on Friday, gaining for a fourth consecutive day, according to the Steel Index .IO62-CNI=SI, surging by about 3 percent in the past week. The most active rebar futures on the Shanghai Futures Exchange rose to 4,244 yuan ($670) per tonne on Monday, their highest in more than three weeks and up half a percent from the previous close.
($1 = 6.3364 Chinese yuan)
Shanghai(Reuters) - Spot iron ore prices are expected to remain flat or dip this week, after last week's gains, as steel mills end a brief restocking period. Iron ore suppliers have also suspended offers during the Christmas holiday season, with steel mills in top buyer China still worried about the state of the market in the new year.
"I see mounting pressures on iron ore prices as spot billet prices continue to fall in Hebei because of rapidly shrinking demand, and we have received fewer offers due to the Christmas holiday," said an iron ore trader in the eastern coastal province of Shandong. Chinese steel mills boosted stockpiles of the raw material in the week before Christmas, picking up bargains as prices fell to around $130 per tonne.
Pilbara fines with 61.5 percent iron content were being offered at $135-138 per tonne on Monday including cost and freight, unchanged for the third consecutive day, Chinese consultancy Umetal said. "We expect to hear fewer deals next week due to the Christmans holiday period," Metal Bulletin Iron Ore Index said in a Friday note.
"Prior to the Chinese new year holiday during the last week of January we expect to see rises as mills look to cover production during this time. This expectation is likely to provide upward pressure over the next few weeks as mills see the stability in the spot price as a good chance to buy material." Iron ore with 62 percent Fe grade rose to $135.7 per tonne on Friday, gaining for a fourth consecutive day, according to the Steel Index .IO62-CNI=SI, surging by about 3 percent in the past week. The most active rebar futures on the Shanghai Futures Exchange rose to 4,244 yuan ($670) per tonne on Monday, their highest in more than three weeks and up half a percent from the previous close.
($1 = 6.3364 Chinese yuan)
Orissa likely to go Bellary way
Monday, 26 Dec 2011
ET reported that Karnataka scenario may now be repeated in Orissa, which produces a third of the country's iron ore and where a state government team is investigating cases of mining contractors taking out and shipping ore illegally.
The culprit in both cases seems to be the abuse of 'raising contracts', agreements between mine owners and operators permitting an individual or a group of individuals owning a mine to outsource the extraction and sale of ore to a third party with expertise.
A pattern similar to Karnataka has been now noted by Orissa officials in the state. Rule 37 of the Mineral Concessions Rules, 1968, permit raising contracts but without the transfer of ownership and financial control of the mine. But in Keonjhar and other districts of Orissa, that is exactly what seems to have happened. The state government suspects some contractors took over mines and shared profits with the original lease holder.
A senior Orissa official of the mines ministry told ET recently that "Our team has submitted a report on eight such mines which we are studying. We have sent notices to three miners and will be auditing some more.”
Eight more are to be scrutinized for similar violations.
One of Keonjhar's older miners said that “It suits lease holders who have been living far from the mines. They could make money without lifting a finger.”
The Justice Shah Commission, which is examining the illegalities in iron ore and manganese mining across the country, also visited some of these mines during its recent trip to the Joda-Barbil area in Keonjhar. The Shah Commission officials specifically wanted to know the nature of the mine's arrangement with the contractor and the question of control.
(Sourced from ET)
ET reported that Karnataka scenario may now be repeated in Orissa, which produces a third of the country's iron ore and where a state government team is investigating cases of mining contractors taking out and shipping ore illegally.
The culprit in both cases seems to be the abuse of 'raising contracts', agreements between mine owners and operators permitting an individual or a group of individuals owning a mine to outsource the extraction and sale of ore to a third party with expertise.
A pattern similar to Karnataka has been now noted by Orissa officials in the state. Rule 37 of the Mineral Concessions Rules, 1968, permit raising contracts but without the transfer of ownership and financial control of the mine. But in Keonjhar and other districts of Orissa, that is exactly what seems to have happened. The state government suspects some contractors took over mines and shared profits with the original lease holder.
A senior Orissa official of the mines ministry told ET recently that "Our team has submitted a report on eight such mines which we are studying. We have sent notices to three miners and will be auditing some more.”
Eight more are to be scrutinized for similar violations.
One of Keonjhar's older miners said that “It suits lease holders who have been living far from the mines. They could make money without lifting a finger.”
The Justice Shah Commission, which is examining the illegalities in iron ore and manganese mining across the country, also visited some of these mines during its recent trip to the Joda-Barbil area in Keonjhar. The Shah Commission officials specifically wanted to know the nature of the mine's arrangement with the contractor and the question of control.
(Sourced from ET)
Sunday, December 25, 2011
Australia Newcastle Thermal coal rises 2pct
Sunday, 25 Dec 2011
Bloomberg reported that power station coal prices at Australia Newcastle port an Asian benchmark rose 2.3% in the week ended today.
According to the globalCOAL NEWC Index coal prices at the New South Wales port increased to USD 112.85 per ton from USD 110.28 the previous week.
Bloomberg reported that power station coal prices at Australia Newcastle port an Asian benchmark rose 2.3% in the week ended today.
According to the globalCOAL NEWC Index coal prices at the New South Wales port increased to USD 112.85 per ton from USD 110.28 the previous week.
Indonesia plans export tax on coal - Report
Sunday, 25 Dec 2011
Reuters reported that an Indonesian industry minister said on that Indonesia will look to introduce export taxes for coal in 2012, as it tries to encourage more investment in its mining sector.
Mr Mohamad Hidayat told Reuters "We are preparing the concept of export tax on mineral products as a supporting policy for encouraging base metal and coal downstream industry development. The idea would soon be discussed at the finance ministry's fiscal policy agency.”
He said “Hopefully we can impose the export tax in 2012.”
Mr Sagala added "This is crucial as a milestone for a total export ban in 2014. If we wait until the total ban is imposed in 2014 then it will be late for the government in preparing the local downstream industry.”
The Indonesian energy and minerals ministry is already drafting a rule that would by 2014 require miners to carry out minimum processing on minerals before export.
Any regulation would be part of a mining and coal law introduced in 2009 that requires miners to process coal and minerals into higher value products before exporting them, as Indonesia seeks to boost revenue from the mining sector.
Indonesia has been considering an export tax on power plant fuel coal for many months, but implementation is likely to face fierce opposition from the industry. The country produces mainly low grade coal, used predominantly in India and China.
(Sourced from Reuters)
Reuters reported that an Indonesian industry minister said on that Indonesia will look to introduce export taxes for coal in 2012, as it tries to encourage more investment in its mining sector.
Mr Mohamad Hidayat told Reuters "We are preparing the concept of export tax on mineral products as a supporting policy for encouraging base metal and coal downstream industry development. The idea would soon be discussed at the finance ministry's fiscal policy agency.”
He said “Hopefully we can impose the export tax in 2012.”
Mr Sagala added "This is crucial as a milestone for a total export ban in 2014. If we wait until the total ban is imposed in 2014 then it will be late for the government in preparing the local downstream industry.”
The Indonesian energy and minerals ministry is already drafting a rule that would by 2014 require miners to carry out minimum processing on minerals before export.
Any regulation would be part of a mining and coal law introduced in 2009 that requires miners to process coal and minerals into higher value products before exporting them, as Indonesia seeks to boost revenue from the mining sector.
Indonesia has been considering an export tax on power plant fuel coal for many months, but implementation is likely to face fierce opposition from the industry. The country produces mainly low grade coal, used predominantly in India and China.
(Sourced from Reuters)
Rio Tinto reassigns coal haulage contracts
Sunday, 25 Dec 2011
It is reported that Rio Tinto has given Asciano a contract for coal haulage from one of its central Queensland mines that was previously split between Asciano and QR National but has allocated a new contract for extra tonnage from another mine to QR National.
Rio Tinto has been building up its Hail Creek mine inland from Mackay and in the past few years has used Asciano fully owned Pacific National to cart two million tonnes per annum while QR National has carted the remainder which has been up to 8mtpa.
But Asicano recently announced a 10 year contract under which it will cart 8mtpa of coal a year to Dalrymple Bay as well as 500,000 tonnes a year from a smaller mine, Kestrel. The contract will put Asciano closer to its goal of having 30% of the Queensland market and the company is building a new maintenance facility at Nebo inland from Mackay that is due to be operating from the middle of next year.
But while QR National lost that contract it gained a 10 year one from Rio Tinto to cart an extra 3 million tonnes per annum from the company Blair Athol/Clermont operations to Abbot Point from January 1 next year. While QR National is already carting coal from this mine to Dalrymple Bay, this new contract is for extra tonnage at the mine and it will go to Abbot Point via what was previously the missing link which was officially opened earlier this week.
This 69 kilometers piece of track links the Goonyella line running to Dalrymple Bay with the Newlands line running to Abbot Point and this sort of contract is exactly the sort of flexibility envisaged in the planning for the line. While QR National paid USD 1.1 billion for the below rail line on which the trains run it must also allow open access above rail and this contract is the second that QR National has won that uses the line, following a 10 year contract with Jellinbah Resources to haul up to 6 million tonnes per annum from its Lake Vermont mine to Abbot Point.
(sourced TheAustralian.com.au)
It is reported that Rio Tinto has given Asciano a contract for coal haulage from one of its central Queensland mines that was previously split between Asciano and QR National but has allocated a new contract for extra tonnage from another mine to QR National.
Rio Tinto has been building up its Hail Creek mine inland from Mackay and in the past few years has used Asciano fully owned Pacific National to cart two million tonnes per annum while QR National has carted the remainder which has been up to 8mtpa.
But Asicano recently announced a 10 year contract under which it will cart 8mtpa of coal a year to Dalrymple Bay as well as 500,000 tonnes a year from a smaller mine, Kestrel. The contract will put Asciano closer to its goal of having 30% of the Queensland market and the company is building a new maintenance facility at Nebo inland from Mackay that is due to be operating from the middle of next year.
But while QR National lost that contract it gained a 10 year one from Rio Tinto to cart an extra 3 million tonnes per annum from the company Blair Athol/Clermont operations to Abbot Point from January 1 next year. While QR National is already carting coal from this mine to Dalrymple Bay, this new contract is for extra tonnage at the mine and it will go to Abbot Point via what was previously the missing link which was officially opened earlier this week.
This 69 kilometers piece of track links the Goonyella line running to Dalrymple Bay with the Newlands line running to Abbot Point and this sort of contract is exactly the sort of flexibility envisaged in the planning for the line. While QR National paid USD 1.1 billion for the below rail line on which the trains run it must also allow open access above rail and this contract is the second that QR National has won that uses the line, following a 10 year contract with Jellinbah Resources to haul up to 6 million tonnes per annum from its Lake Vermont mine to Abbot Point.
(sourced TheAustralian.com.au)
Philippine coal firm ink 7 year power deal with Meralco
Sunday, 25 Dec 2011
Reuters reported that the Philippines' largest coal producer, Semirara Mining Corp a wholly owned unit had signed 7 year deal to sell up to a 410 MW power capacity to Manila Electric Co.
The deal between Meralco, the country largest power distributor, and Semirara SEM-Calaca Power Corp unit involves an initial contracted capacity of 210 MW which can be increased by 200 MW.
The two parties could extend the deal by three years, Semirara told the stock exchange without disclosing any financial details.
SEM-Calaca owns a 600 MW coal fired thermal power plant in Batangas province, south of Manila while Semirara operates the country biggest coal mine located in the central Visayas region.
Meralco which is indirectly controlled by Hong Kong-based conglomerate First Pacific Co Ltd and partly owned by San Miguel Corp is looking to build power plants with a total capacity of 1,500 MW over the next four years to meet an expected increase in power demand.
(Sourced from Reuters)
Reuters reported that the Philippines' largest coal producer, Semirara Mining Corp a wholly owned unit had signed 7 year deal to sell up to a 410 MW power capacity to Manila Electric Co.
The deal between Meralco, the country largest power distributor, and Semirara SEM-Calaca Power Corp unit involves an initial contracted capacity of 210 MW which can be increased by 200 MW.
The two parties could extend the deal by three years, Semirara told the stock exchange without disclosing any financial details.
SEM-Calaca owns a 600 MW coal fired thermal power plant in Batangas province, south of Manila while Semirara operates the country biggest coal mine located in the central Visayas region.
Meralco which is indirectly controlled by Hong Kong-based conglomerate First Pacific Co Ltd and partly owned by San Miguel Corp is looking to build power plants with a total capacity of 1,500 MW over the next four years to meet an expected increase in power demand.
(Sourced from Reuters)
Afferro Mining files new NI43 101 report on Nkout iron ore project
Sunday, 25 Dec 2011
Iron ore miner Afferro Mining has filed a technical report which is compliant with the NI43-101 standard on its Nkout project in Cameroon. Investors welcomed the news as shares in the company rose 3% to trade at 53 pence in early deals valuing the company at GBP 55.1 million.
The latest NI43-101 compliant report on Nkout which was unveiled in November showed a 41% increase in the total resource to 2 billion tonnes grading 32.2 iron. Afferro said that the new resource includes a 70% increase in tonnage of high-grade, potential direct shipping ore. The project is now estimated to contain 18.5 million tonnes of direct shipping ore.
The DSO grades have improved from 58.7% to 60.3%. In addition, 944 million tonnes of magnetite banded iron formation was upgraded to the indicated category representing 47% of the mineral resource estimate.
The company noted that the MRE now covers an 8.9 kilometre section of a 20 km long magnetic anomaly. Afferro continues its drilling program at Nkout to further define high grade zones and add additional tonnage at depth.
(sourced from Proactiveinvestors.co.uk)
Iron ore miner Afferro Mining has filed a technical report which is compliant with the NI43-101 standard on its Nkout project in Cameroon. Investors welcomed the news as shares in the company rose 3% to trade at 53 pence in early deals valuing the company at GBP 55.1 million.
The latest NI43-101 compliant report on Nkout which was unveiled in November showed a 41% increase in the total resource to 2 billion tonnes grading 32.2 iron. Afferro said that the new resource includes a 70% increase in tonnage of high-grade, potential direct shipping ore. The project is now estimated to contain 18.5 million tonnes of direct shipping ore.
The DSO grades have improved from 58.7% to 60.3%. In addition, 944 million tonnes of magnetite banded iron formation was upgraded to the indicated category representing 47% of the mineral resource estimate.
The company noted that the MRE now covers an 8.9 kilometre section of a 20 km long magnetic anomaly. Afferro continues its drilling program at Nkout to further define high grade zones and add additional tonnage at depth.
(sourced from Proactiveinvestors.co.uk)
Thursday, December 22, 2011
Indonesia may produce 375 million tonnes to 390 million tonnes of coal in 2012
Thursday, 22 Dec 2011
Bloomberg quoted Mr Bob Kamandanu chairman of the Indonesian Coal Mining Association said Indonesia expects to produce 375 million tons to 390 million tons of coal in 2012 to meet growing demand from India and China.
He said Indonesia will probably consume 65 million tons to 70 million tons of coal next year.
(Sourced from Bloomberg)
Bloomberg quoted Mr Bob Kamandanu chairman of the Indonesian Coal Mining Association said Indonesia expects to produce 375 million tons to 390 million tons of coal in 2012 to meet growing demand from India and China.
He said Indonesia will probably consume 65 million tons to 70 million tons of coal next year.
(Sourced from Bloomberg)
Vale looking to sell Valemax iron ore carriers - Report
Thursday, 22 Dec 2011
Vale is looking to sell off its large iron ore carriers amid fierce opposition from Chinese ship owners and embarrassing teething problems as the second largest mining company shifts its focus back to core projects.
Mr José Carlos Martins Vale executive director for iron ore and strategy said that the Brazilian company would sell its so called Valemax most of which have not yet been built, if it could take long term leases on them.
The multi billion dollar plan to control shipments to China by building 35 ships with decks the size of three football fields the biggest dry bulk carriers ever was dreamt up by Mr Roger Agnelli, Vale former headstrong chief executive but it has faced heavy criticism since.
None of the new carriers has been able to dock in China, Vale biggest market, because of opposition from local Shipowners and technical difficulties while a mysterious leak aboard the Vale Beijing on its maiden voyage this month has raised safety concerns.
The move to sell the ships also comes as Mr Murilo Ferreira Vale new more cautious and diplomatic chief executive is reviewing spending on all projects to help strengthen the company finances in the face of falling commodity prices.
Mr Martins said “It’s really all about capital allocation. We prefer to invest our capital in mining and contract the ships instead, declining to comment on whether negotiations were already under way. There is no reason we actually have to own them.”
Vale began placing orders in 2008 for the 35 Valemax of which it planned to own 19 in an attempt to control the price it paid to move its iron ore to China after years of wild gyrations in charter prices. Rates per day for capsize ships the largest dry bulk carriers reached as high as USD 233,988 per day in June 2008 but subsequently plummeted by December that year to as low as USD 2,400.
(Sourced from www.ft.com)
Vale is looking to sell off its large iron ore carriers amid fierce opposition from Chinese ship owners and embarrassing teething problems as the second largest mining company shifts its focus back to core projects.
Mr José Carlos Martins Vale executive director for iron ore and strategy said that the Brazilian company would sell its so called Valemax most of which have not yet been built, if it could take long term leases on them.
The multi billion dollar plan to control shipments to China by building 35 ships with decks the size of three football fields the biggest dry bulk carriers ever was dreamt up by Mr Roger Agnelli, Vale former headstrong chief executive but it has faced heavy criticism since.
None of the new carriers has been able to dock in China, Vale biggest market, because of opposition from local Shipowners and technical difficulties while a mysterious leak aboard the Vale Beijing on its maiden voyage this month has raised safety concerns.
The move to sell the ships also comes as Mr Murilo Ferreira Vale new more cautious and diplomatic chief executive is reviewing spending on all projects to help strengthen the company finances in the face of falling commodity prices.
Mr Martins said “It’s really all about capital allocation. We prefer to invest our capital in mining and contract the ships instead, declining to comment on whether negotiations were already under way. There is no reason we actually have to own them.”
Vale began placing orders in 2008 for the 35 Valemax of which it planned to own 19 in an attempt to control the price it paid to move its iron ore to China after years of wild gyrations in charter prices. Rates per day for capsize ships the largest dry bulk carriers reached as high as USD 233,988 per day in June 2008 but subsequently plummeted by December that year to as low as USD 2,400.
(Sourced from www.ft.com)
Bid for coal mine near Eneabba rejected
Thursday, 22 Dec 2011
It is reported that a bid by Central West Coal to develop a coal mine south of Eneabba has been rejected.
The Environmental Protection Authority considered five appeals against the development. It concluded the proposal could not meet its environmental objectives for protecting flora and fauna.
Mr Bill Marmion Environment Minister said the EPA decision is justified and appropriate. He will now consult with the relevant environmental authorities to determine whether or not the proposal can be implemented and under what operating conditions.
(sourced from www.abc.net.au)
It is reported that a bid by Central West Coal to develop a coal mine south of Eneabba has been rejected.
The Environmental Protection Authority considered five appeals against the development. It concluded the proposal could not meet its environmental objectives for protecting flora and fauna.
Mr Bill Marmion Environment Minister said the EPA decision is justified and appropriate. He will now consult with the relevant environmental authorities to determine whether or not the proposal can be implemented and under what operating conditions.
(sourced from www.abc.net.au)
China Bohai Rim steam coal price falls 1pct to CNY 821 per tonne
Thursday, 22 Dec 2011
Bloomberg reported that China Bohai-Rim Steam-Coal Price Index, which tracks power-station coal prices at six ports fell 1.1% to CNY 821 per ton as of today compared with a week earlier.
This is the sixth consecutive decline.
(Sourced from Bloomberg)
Bloomberg reported that China Bohai-Rim Steam-Coal Price Index, which tracks power-station coal prices at six ports fell 1.1% to CNY 821 per ton as of today compared with a week earlier.
This is the sixth consecutive decline.
(Sourced from Bloomberg)
China warns of risks of buying Iranian iron ore
Thursday, 22 Dec 2011
Reuters reported that China warned about the risks of importing Iranian iron ore, the second major commodity from the sanctions-hit Islamic Republic under scrutiny as the two also tussle over oil payment terms.
The warning from the Commerce Ministry to domestic companies, which focused on substandard quality and on delivery problems, follows crude imports spat that has seen China halve its Iranian oil shipments for January.
An iron ore analyst in Beijing who asked not to be identified due to the sensitive nature of the matter said "I would consider this very similar to the crude oil import limitation by Zhuhai Zhenrong."
The analyst said "First, the timing is perfect, just on the heels of oil import payment concerns a few days ago by Zhuhai Zhenrong. And secondly, China also used commercial risks as the main reason."
China's top refiner Sinopec, both directly and through state Chinese state trading company Zhuhai Zhenrong Corp has cut crude imports from Iran by over half in January.
The ministry said in a statement that "We have received lots of complaints from domestic companies about fraud regarding iron ore imports."
The ministry added that Iranian companies have severely damaged Chinese companies' interests by using substandard materials, refusing to deliver materials or delivering less than what was originally agreed to.
(Sourced from Reuters)
Reuters reported that China warned about the risks of importing Iranian iron ore, the second major commodity from the sanctions-hit Islamic Republic under scrutiny as the two also tussle over oil payment terms.
The warning from the Commerce Ministry to domestic companies, which focused on substandard quality and on delivery problems, follows crude imports spat that has seen China halve its Iranian oil shipments for January.
An iron ore analyst in Beijing who asked not to be identified due to the sensitive nature of the matter said "I would consider this very similar to the crude oil import limitation by Zhuhai Zhenrong."
The analyst said "First, the timing is perfect, just on the heels of oil import payment concerns a few days ago by Zhuhai Zhenrong. And secondly, China also used commercial risks as the main reason."
China's top refiner Sinopec, both directly and through state Chinese state trading company Zhuhai Zhenrong Corp has cut crude imports from Iran by over half in January.
The ministry said in a statement that "We have received lots of complaints from domestic companies about fraud regarding iron ore imports."
The ministry added that Iranian companies have severely damaged Chinese companies' interests by using substandard materials, refusing to deliver materials or delivering less than what was originally agreed to.
(Sourced from Reuters)
Jingyuan Coal to acquire coal assets
Thursday, 22 Dec 2011
It is reported that Gansu Jingyuan Coal Industry And Electricity Power intends to issue 162.59 million shares to controlling shareholder, Jingyuan Coal Group at CNY 16.36 per share in order to purchase CNY 2.66 billion worth of coal assets from the latter.
The assets to be purchased include Baiyin Energy Saving Thermal, Qingmei Engineering Investigation, Jinghong Storage and Transportation, Jingyuan Coal Yilin Resource Development and other related assets.
The assets recorded total revenue of CNY 2.519 billion and net profit of CNY 286 million during the first three quarters of 2011. After the completion of the transaction, Jingyuan Coal Group will have 246 million shares or a 72.37% stake in the listed company.
The acquisitions will increase Jingyuan Coal recoverable coal reserves by 250 million tonnes and raise mine production volume by 7.63 million tons per year.
It was reported that the transaction will solve the problem of horizontal competition between Jingyuan Coal and Jingyuan Coal Group.
(Sourced from Shanghai Securities News)
It is reported that Gansu Jingyuan Coal Industry And Electricity Power intends to issue 162.59 million shares to controlling shareholder, Jingyuan Coal Group at CNY 16.36 per share in order to purchase CNY 2.66 billion worth of coal assets from the latter.
The assets to be purchased include Baiyin Energy Saving Thermal, Qingmei Engineering Investigation, Jinghong Storage and Transportation, Jingyuan Coal Yilin Resource Development and other related assets.
The assets recorded total revenue of CNY 2.519 billion and net profit of CNY 286 million during the first three quarters of 2011. After the completion of the transaction, Jingyuan Coal Group will have 246 million shares or a 72.37% stake in the listed company.
The acquisitions will increase Jingyuan Coal recoverable coal reserves by 250 million tonnes and raise mine production volume by 7.63 million tons per year.
It was reported that the transaction will solve the problem of horizontal competition between Jingyuan Coal and Jingyuan Coal Group.
(Sourced from Shanghai Securities News)
China's Yanzhou inks A$700 mln deal for Gloucester Coal
Thu Dec 22, 2011
* Yanzhou says to merge Australian unit with Gloucester Coal
* Deal worth A$700 million in cash, or A$3.20 per share - Yancoal
* Reverse takeover creates one of largest coal companies in Australia
SYDNEY/HONG KONG, Dec 22 (Reuters) - China's Yanzhou Coal Mining Co Ltd said on Thursday it plans to merge its Australian unit with Gloucester Coal in a A$700 million deal that will create one of Australia's largest listed coal companies.
Australia's coal sector has seen a series of mergers and acquisitions initiated by Asian suitors hungry to satisfy fast growing domestic demand for coal from steel mills and power generation plants.
Yanzhou Coal's deal for Gloucester is also yet another case of a Chinese company buying up natural resource assets in Australia, tapping its commodity base to fuel massive residential, commercial and infrastructure projects across China.
Sydney-based Gloucester will be merged with Yancoal Australia Ltd., and Yanzhou will own 77 percent of the new company. Gloucester shareholders will own the rest and receive A$700 million ($705.36 million) in cash, the equivalent of A$3.20 in per share, Yancoal said in a statement. Each Gloucester Coal shareholder will receive one share in the merged company.
Gloucester closed at A$7.03 in Sydney on Dec. 19, before trading in the shares was suspended.
The reverse takeover of Gloucester would give Yanzhou Coal's Australian unit, Yancoal Australia Ltd, a local listing without having to risk an initial public offering in a shaky market, where coal stocks in particular have been pummelled on worries about a global economic downturn.
A condition of Yancoal's A$3.3 billion takeover of another Australian coal miner, Felix Resources, in 2009 required it to float at least 30 percent of the business on the local exchange by 2012.
Yanzhou Coal chairman Li Weimin said in a statement the merger plan allows it to meet that requirement and at the same time "reflects the company's strategy to grow our Australia business and to become a global leader in the coal mining sector."
Gloucester, which has a market value of A$1.4 billion, is 64 percent owned by commodities trader Noble Group. Trading in the coal firm's shares were suspended earlier Thursday ahead of the expected offer.
Yanzhou said the transaction is subject to various approvals, and plans to complete the deal in the second quarter of 2012.
Yancoal and Gloucester both have mines and projects in New South Wales and Queensland. Gloucester aims to expand production to 10 million tonnes a year by 2016, while Yancoal expects to produce 20 million tonnes a year by 2015.
That would put a combined group ahead of Whitehaven Coal , which last week announced a $2.5 billion takeover of Aston Resources to create a company producing 25 million tonnes a year by 2016.
Since taking over Felix Resources, Yancoal has bought Syntech Resources for A$203 million and is about to complete the A$297 million acquisition of Premier Coal from Wesfarmers.
It sought to buy Whitehaven Coal earlier this year but the two were unable to settle on a price.
(sourced Reuters)
* Yanzhou says to merge Australian unit with Gloucester Coal
* Deal worth A$700 million in cash, or A$3.20 per share - Yancoal
* Reverse takeover creates one of largest coal companies in Australia
SYDNEY/HONG KONG, Dec 22 (Reuters) - China's Yanzhou Coal Mining Co Ltd said on Thursday it plans to merge its Australian unit with Gloucester Coal in a A$700 million deal that will create one of Australia's largest listed coal companies.
Australia's coal sector has seen a series of mergers and acquisitions initiated by Asian suitors hungry to satisfy fast growing domestic demand for coal from steel mills and power generation plants.
Yanzhou Coal's deal for Gloucester is also yet another case of a Chinese company buying up natural resource assets in Australia, tapping its commodity base to fuel massive residential, commercial and infrastructure projects across China.
Sydney-based Gloucester will be merged with Yancoal Australia Ltd., and Yanzhou will own 77 percent of the new company. Gloucester shareholders will own the rest and receive A$700 million ($705.36 million) in cash, the equivalent of A$3.20 in per share, Yancoal said in a statement. Each Gloucester Coal shareholder will receive one share in the merged company.
Gloucester closed at A$7.03 in Sydney on Dec. 19, before trading in the shares was suspended.
The reverse takeover of Gloucester would give Yanzhou Coal's Australian unit, Yancoal Australia Ltd, a local listing without having to risk an initial public offering in a shaky market, where coal stocks in particular have been pummelled on worries about a global economic downturn.
A condition of Yancoal's A$3.3 billion takeover of another Australian coal miner, Felix Resources, in 2009 required it to float at least 30 percent of the business on the local exchange by 2012.
Yanzhou Coal chairman Li Weimin said in a statement the merger plan allows it to meet that requirement and at the same time "reflects the company's strategy to grow our Australia business and to become a global leader in the coal mining sector."
Gloucester, which has a market value of A$1.4 billion, is 64 percent owned by commodities trader Noble Group. Trading in the coal firm's shares were suspended earlier Thursday ahead of the expected offer.
Yanzhou said the transaction is subject to various approvals, and plans to complete the deal in the second quarter of 2012.
Yancoal and Gloucester both have mines and projects in New South Wales and Queensland. Gloucester aims to expand production to 10 million tonnes a year by 2016, while Yancoal expects to produce 20 million tonnes a year by 2015.
That would put a combined group ahead of Whitehaven Coal , which last week announced a $2.5 billion takeover of Aston Resources to create a company producing 25 million tonnes a year by 2016.
Since taking over Felix Resources, Yancoal has bought Syntech Resources for A$203 million and is about to complete the A$297 million acquisition of Premier Coal from Wesfarmers.
It sought to buy Whitehaven Coal earlier this year but the two were unable to settle on a price.
(sourced Reuters)
Anglo American ships first iron ore from Kolomela in South Africa
Thursday, 22 Dec 2011
Reuters reported that global miner Anglo American has exported the first shipment from the USD 1 billion Kolomela iron ore mine in South Africa one of its key growth projects putting the mine ahead of schedule and on track to achieve full production by 2013.
The miner said Kolomela one of the projects expected to drive organic volume growth for Anglo has been commissioned five months ahead of schedule and on budget.
Mr Chris Griffith CEO of Anglo American Kumba Iron Ore business said "The first shipment of 100,000 tonnes of Kolomela lump ore left the port of Saldanha on 19 December 2011."
He said that "The commissioning of the Kolomela project is in line with our growth strategy of ramping our South African production up to 70 million tonnes per year by 2019."
Kolomela had been expected to deliver initial production at the end of the first half of 2012.
(Sourced from Reuters)
Reuters reported that global miner Anglo American has exported the first shipment from the USD 1 billion Kolomela iron ore mine in South Africa one of its key growth projects putting the mine ahead of schedule and on track to achieve full production by 2013.
The miner said Kolomela one of the projects expected to drive organic volume growth for Anglo has been commissioned five months ahead of schedule and on budget.
Mr Chris Griffith CEO of Anglo American Kumba Iron Ore business said "The first shipment of 100,000 tonnes of Kolomela lump ore left the port of Saldanha on 19 December 2011."
He said that "The commissioning of the Kolomela project is in line with our growth strategy of ramping our South African production up to 70 million tonnes per year by 2019."
Kolomela had been expected to deliver initial production at the end of the first half of 2012.
(Sourced from Reuters)
Wednesday, December 21, 2011
UK-listed Beacon Hill exports first Mozambique thermal coal cargo
Wednesday, 21 December 2011
Beacon Hill Resources has shipped its first export cargo of Moatize thermal coal from Mozambique's port of Beira at the weekend, it said Monday in a statement to the London Alternative Investment Market. Beacon Hill's first export shipment comprised 10,650 mt of thermal coal that was trucked to Beira port from the company's Minas Moatize mine in Mozambique's Tete province and was loaded into the vessel MV Aztec Maiden. "The proof of concept of this initial economically viable shipment allows us to evaluate key elements in the supply chain, a process which will be highly beneficial to the group when we commence production of coking coal in Q1 2012," said Beacon Hill chairman Justin Lewis in the statement.
The London-listed coal producer said it was confident of attaining export capacity in Mozambique's Sena railway to Beira port in 2012, which would pave the way for its plan to upgrade production to 2 million mt/year of coking and thermal coal over the next two years.
The company did not disclose the thermal coal cargo's destination, though a possible market could be India, which like Mozambique borders the Indian Ocean.
In the meantime, Beacon Hill is to rely on trucks to transport 500,000 mt/year of its Moatize coal to port, which is more than adequate for the company's production in 2012. Beacon Hill said in its statement that it was having ongoing talks with the Mozambique government, which recently took over the operation of the Sena railway. The company, together with Brazilian miner Vale and Rio Tinto, which now owns Riversdale Mining, is finalizing terms of reference to upgrade the Sena railway to a capacity for coal exports of 6.5 million mt/year by the middle of next year, and to 12 million mt/year by the end of 2012. "Our export capacity will be significantly enhanced by the receipt of an allocation to the Sena rail line, in conjunction with its refurbishment next year," added Lewis.
sourced Platts
Beacon Hill Resources has shipped its first export cargo of Moatize thermal coal from Mozambique's port of Beira at the weekend, it said Monday in a statement to the London Alternative Investment Market. Beacon Hill's first export shipment comprised 10,650 mt of thermal coal that was trucked to Beira port from the company's Minas Moatize mine in Mozambique's Tete province and was loaded into the vessel MV Aztec Maiden. "The proof of concept of this initial economically viable shipment allows us to evaluate key elements in the supply chain, a process which will be highly beneficial to the group when we commence production of coking coal in Q1 2012," said Beacon Hill chairman Justin Lewis in the statement.
The London-listed coal producer said it was confident of attaining export capacity in Mozambique's Sena railway to Beira port in 2012, which would pave the way for its plan to upgrade production to 2 million mt/year of coking and thermal coal over the next two years.
The company did not disclose the thermal coal cargo's destination, though a possible market could be India, which like Mozambique borders the Indian Ocean.
In the meantime, Beacon Hill is to rely on trucks to transport 500,000 mt/year of its Moatize coal to port, which is more than adequate for the company's production in 2012. Beacon Hill said in its statement that it was having ongoing talks with the Mozambique government, which recently took over the operation of the Sena railway. The company, together with Brazilian miner Vale and Rio Tinto, which now owns Riversdale Mining, is finalizing terms of reference to upgrade the Sena railway to a capacity for coal exports of 6.5 million mt/year by the middle of next year, and to 12 million mt/year by the end of 2012. "Our export capacity will be significantly enhanced by the receipt of an allocation to the Sena rail line, in conjunction with its refurbishment next year," added Lewis.
sourced Platts
Iron ore prices drop in China amid falling investments
Wednesday, 21 Dec 2011
Xinhua reported that sharply decreasing fixed asset investment in the railways and increased housing inventory in the property market are cutting demand for steel, resulting in falling prices of imported iron ore in the world's second largest economy.
According to the Xinhua-China Iron Ore Price Index that was released that inventories of iron ore at 25 of China's major sea ports dropped 1.6% to 97.99 million tonnes in the week ending on Dec 19 from the previous week.
According to the index, which is compiled by the Xinhua News Agency to track iron ore inventories and imports in Chinese spot markets Last week's imported iron ore stock was 1.61 million metric tons less than that of one week earlier.
The price index for 63.5% purity iron ore imports fell 4.1% to hit 139 points while that for 58% purity iron ore imports decreased by 1.7% WoW to rest at 117 points.
Analysts said the declining prices of iron ore are a result of a sluggish steel market amid falling investment in the nation railway projects and increased housing inventory in the property sector.
According to data from the Ministry of Railways, fixed asset investment in railways in the first 11 months of the year plunged 28.4%YoY to CNY 492 billion. The decline rate widened by 3.2 percentage points compared to that in the first ten months.
In November, more major cities saw drops in new home prices from October as housing sales slipped 1.2%YoY with major developers such as China Vanke experiencing a 20% sales decrease last month.
Analysts predicted a further downward trend for the iron ore prices in the coming week as steel companies are becoming cautious in purchases amid expectations that downstream businesses will cut demand for steel.
(Sourced from Xinhua)
Xinhua reported that sharply decreasing fixed asset investment in the railways and increased housing inventory in the property market are cutting demand for steel, resulting in falling prices of imported iron ore in the world's second largest economy.
According to the Xinhua-China Iron Ore Price Index that was released that inventories of iron ore at 25 of China's major sea ports dropped 1.6% to 97.99 million tonnes in the week ending on Dec 19 from the previous week.
According to the index, which is compiled by the Xinhua News Agency to track iron ore inventories and imports in Chinese spot markets Last week's imported iron ore stock was 1.61 million metric tons less than that of one week earlier.
The price index for 63.5% purity iron ore imports fell 4.1% to hit 139 points while that for 58% purity iron ore imports decreased by 1.7% WoW to rest at 117 points.
Analysts said the declining prices of iron ore are a result of a sluggish steel market amid falling investment in the nation railway projects and increased housing inventory in the property sector.
According to data from the Ministry of Railways, fixed asset investment in railways in the first 11 months of the year plunged 28.4%YoY to CNY 492 billion. The decline rate widened by 3.2 percentage points compared to that in the first ten months.
In November, more major cities saw drops in new home prices from October as housing sales slipped 1.2%YoY with major developers such as China Vanke experiencing a 20% sales decrease last month.
Analysts predicted a further downward trend for the iron ore prices in the coming week as steel companies are becoming cautious in purchases amid expectations that downstream businesses will cut demand for steel.
(Sourced from Xinhua)
New capacity in coal sector in India during 12th plan
Wednesday, 21 Dec 2011
Mr Pratik Prakashbapu Patil minister of state in the ministry of coal informed the Lok Sabha that the government proposes to add new capacity by way of taking up of new projects as well as expansion of existing projects through Coal India Ltd and its subsidiaries, Neyveli Lignite Corporation Ltd and Singareni Collieries Company Ltd in Public Sector. Further, new capacity addition in production through coal block allocatees both Public and Private Sector is also envisaged.
It is envisaged that during the 12th plan period the annual production of coal will increase from 447 million tonne to 615 million tonne by CIL, from 51 million tonne to 57 million tonne by SCCL and for lignite it is envisaged to increase from 41.64 million tonne to 68.60 million tonne by NLC by way of capacity addition. The production from coal block allocatees is envisaged to increase from 36.15 million tonne to 100 million tonne during the above period.
The minister further added that as per the recommendations of the Working Group on coal for the 12th Five Year plan (2012-2017), the capital outlay for Coal and Lignite sector during the above period is envisaged as under:
Coal India Ltd INR 25400 crore
Singareni Collieries Company Ltd INR 10350 crore
Neyveli Lignite Corporation Ltd INR 3481 crore
Mr Pratik Prakashbapu Patil minister of state in the ministry of coal informed the Lok Sabha that the government proposes to add new capacity by way of taking up of new projects as well as expansion of existing projects through Coal India Ltd and its subsidiaries, Neyveli Lignite Corporation Ltd and Singareni Collieries Company Ltd in Public Sector. Further, new capacity addition in production through coal block allocatees both Public and Private Sector is also envisaged.
It is envisaged that during the 12th plan period the annual production of coal will increase from 447 million tonne to 615 million tonne by CIL, from 51 million tonne to 57 million tonne by SCCL and for lignite it is envisaged to increase from 41.64 million tonne to 68.60 million tonne by NLC by way of capacity addition. The production from coal block allocatees is envisaged to increase from 36.15 million tonne to 100 million tonne during the above period.
The minister further added that as per the recommendations of the Working Group on coal for the 12th Five Year plan (2012-2017), the capital outlay for Coal and Lignite sector during the above period is envisaged as under:
Coal India Ltd INR 25400 crore
Singareni Collieries Company Ltd INR 10350 crore
Neyveli Lignite Corporation Ltd INR 3481 crore
Tuesday, December 20, 2011
Rising coal costs to hit India power projects - Fitch
Tuesday, Dec20, 2011
MUMBAI(Reuters)-The rising cost of imported coal, coupled with a weakening rupee, could force some Indian power projects to default on their debt obligations, ratings agency Fitch said on Tuesday. Fitch estimated that the average cost of generation could rise to 4.41 rupees (8 cents) per kilowatt hour for projects relying entirely on imported coal, from the current average of 2.29 rupees, if current trends continue.
Coal accounts for 55 percent of India's power generation capacity of 182,344 megawatts.
But while the country holds 10 percent of the world's coal reserves, power companies often struggle to access local supplies due to environmental and land acquisition delays, forcing expensive imports. The higher costs could put massive pressure on plants that cannot pass on higher fuel costs to customers, and in some cases this could render projects unviable, the ratings agency said.
"Financial margins of power projects will also come under severe pressure in the absence of a significant tariff revision or injection of additional sponsor equity," Venkataraman Rajaraman, director at Fitch's Global Infrastructure group, said in a statement accompanying a report on the industry. Most new Indian power projects are dependent on imported coal and have seen their costs jump over the past year.
Asia's third-largest economy has a peak-hours power shortage of 13 percent of requirements as rising demand from industry, homes and shopping malls outstrips capacity growth, but investments in the power sector have been slowing.
(sourced Reuters)
MUMBAI(Reuters)-The rising cost of imported coal, coupled with a weakening rupee, could force some Indian power projects to default on their debt obligations, ratings agency Fitch said on Tuesday. Fitch estimated that the average cost of generation could rise to 4.41 rupees (8 cents) per kilowatt hour for projects relying entirely on imported coal, from the current average of 2.29 rupees, if current trends continue.
Coal accounts for 55 percent of India's power generation capacity of 182,344 megawatts.
But while the country holds 10 percent of the world's coal reserves, power companies often struggle to access local supplies due to environmental and land acquisition delays, forcing expensive imports. The higher costs could put massive pressure on plants that cannot pass on higher fuel costs to customers, and in some cases this could render projects unviable, the ratings agency said.
"Financial margins of power projects will also come under severe pressure in the absence of a significant tariff revision or injection of additional sponsor equity," Venkataraman Rajaraman, director at Fitch's Global Infrastructure group, said in a statement accompanying a report on the industry. Most new Indian power projects are dependent on imported coal and have seen their costs jump over the past year.
Asia's third-largest economy has a peak-hours power shortage of 13 percent of requirements as rising demand from industry, homes and shopping malls outstrips capacity growth, but investments in the power sector have been slowing.
(sourced Reuters)
Coal mega-mines a 'global threat'
Tuesday, 20 December 2011
THE development of coal ''mega-mines'' in central Queensland, such as the massive China First project, will destroy the world's chance of keeping global warming to 2 degrees, the environmental group Greenpeace claims. In its submission to the federal government on the environmental impact of mining magnate Clive Palmer's $7.5 billion China First mine, the green group says this and other big projects in Queensland's Galilee Basin would lock in huge coal exploitation for decades to come. ''If this goes ahead, it will destroy our chances of keeping global warming to 2 degrees,'' said Greenpeace campaigner John Hepburn.
The International Energy Agency says the world needs to make ''urgent and radical policy changes'' if it is to stick to the internationally agreed goal of limiting global warming to 2 degrees by the end of the century. The agency drew up a ''carbon budget'' that would allow the world to meet that target. If the proposed mega-mines in the Galilee Basin run at full pace, by 2035 they would be eating up 4 per cent of the world's carbon budget and 9 per cent of the emissions set aside for coal, according to the Institute for Sustainable Futures at the University of Technology Sydney on behalf of Greenpeace.
The claims follow the release of a report on Thursday that found China First, planned by Mr Palmer's firm Waratah Coal, would exacerbate the two-speed economy by pushing up the dollar, creating labour shortages and driving up wages. A statement from Waratah Coal said the company would ''ensure that the project has the highest integrity and meets all environmental requirements''.
Source: SMH
THE development of coal ''mega-mines'' in central Queensland, such as the massive China First project, will destroy the world's chance of keeping global warming to 2 degrees, the environmental group Greenpeace claims. In its submission to the federal government on the environmental impact of mining magnate Clive Palmer's $7.5 billion China First mine, the green group says this and other big projects in Queensland's Galilee Basin would lock in huge coal exploitation for decades to come. ''If this goes ahead, it will destroy our chances of keeping global warming to 2 degrees,'' said Greenpeace campaigner John Hepburn.
The International Energy Agency says the world needs to make ''urgent and radical policy changes'' if it is to stick to the internationally agreed goal of limiting global warming to 2 degrees by the end of the century. The agency drew up a ''carbon budget'' that would allow the world to meet that target. If the proposed mega-mines in the Galilee Basin run at full pace, by 2035 they would be eating up 4 per cent of the world's carbon budget and 9 per cent of the emissions set aside for coal, according to the Institute for Sustainable Futures at the University of Technology Sydney on behalf of Greenpeace.
The claims follow the release of a report on Thursday that found China First, planned by Mr Palmer's firm Waratah Coal, would exacerbate the two-speed economy by pushing up the dollar, creating labour shortages and driving up wages. A statement from Waratah Coal said the company would ''ensure that the project has the highest integrity and meets all environmental requirements''.
Source: SMH
Japan crude steel output hits 10-year low for November
Tuesday, 20 December 2011
Japan's crude steel output fell 3.2 percent in November from a year earlier to the lowest level in 10 years for that month, an industry body said on Monday, after floods in Thailand, an Asian hub for car production, reduced demand for steel.The November output figure, which is not seasonally adjusted, was 8.7 million tonnes. That was the lowest for the month since 2001, when November output totalled 8.1 million tonnes, the Japan Iron and Steel Federation said.
Electric furnace steelmakers, which melt steel scrap, increased output in November on a continued recovery in building construction after the March earthquake and tsunami. But Japan's top steelmakers curbed output in reaction to a decline in exports.
"It was November when customers actually started cutting new contract volumes because of the Thai floods," a federation official said, adding that the strong yen was also hurting exports to Asia.
Last month, JFE Steel Corp, the world No.5 steel maker, said it plans to produce 300,000 tonnes less crude steel in the October-December period than originally planned. It joined Nippon Steel Corp and some other Asian steelmakers in cutting output following a rapid deterioration of Asia's steel market since September.
Monday's data showed that output at electric furnace steelmakers rose 5.2 percent from a year earlier to 2.2 million tonnes, but production by blast furnace steelmakers fell 5.8 percent to 6.5 million tonnes. For overall output, it was the third consecutive year-on-year decline, after falling 0.3 percent in October and 3.8 percent in September.Compared with October, output fell 8.3 percent, the fastest month-on-month decline since February 2009. On a daily basis, output was down 5.2 percent from October.Crude steel production totalled 99.2 million tonnes in the first 11 months of this year, down 1.2 percent from the same period in 2010, the data showed.
Source: Reuters
Japan's crude steel output fell 3.2 percent in November from a year earlier to the lowest level in 10 years for that month, an industry body said on Monday, after floods in Thailand, an Asian hub for car production, reduced demand for steel.The November output figure, which is not seasonally adjusted, was 8.7 million tonnes. That was the lowest for the month since 2001, when November output totalled 8.1 million tonnes, the Japan Iron and Steel Federation said.
Electric furnace steelmakers, which melt steel scrap, increased output in November on a continued recovery in building construction after the March earthquake and tsunami. But Japan's top steelmakers curbed output in reaction to a decline in exports.
"It was November when customers actually started cutting new contract volumes because of the Thai floods," a federation official said, adding that the strong yen was also hurting exports to Asia.
Last month, JFE Steel Corp, the world No.5 steel maker, said it plans to produce 300,000 tonnes less crude steel in the October-December period than originally planned. It joined Nippon Steel Corp and some other Asian steelmakers in cutting output following a rapid deterioration of Asia's steel market since September.
Monday's data showed that output at electric furnace steelmakers rose 5.2 percent from a year earlier to 2.2 million tonnes, but production by blast furnace steelmakers fell 5.8 percent to 6.5 million tonnes. For overall output, it was the third consecutive year-on-year decline, after falling 0.3 percent in October and 3.8 percent in September.Compared with October, output fell 8.3 percent, the fastest month-on-month decline since February 2009. On a daily basis, output was down 5.2 percent from October.Crude steel production totalled 99.2 million tonnes in the first 11 months of this year, down 1.2 percent from the same period in 2010, the data showed.
Source: Reuters
12891 cases of illegal mining in Karnataka
Tuesday, 20 Dec 2011
Mr Dinsha Patel minister of state for mines (independent charge) informed the Rajya Sabha Karnataka state government detected 12891 cases of illegal mining of minor and major minerals for the period June, 2006 till December, 2009, and for the year 2010-11, it has reported 6476 cases of illegal mining.
Details of iron ore produced illegally in Karnataka are not maintained centrally. As per the National Mineral Inventory maintained by the Indian Bureau of Mines, 34.91% of total iron ore resources in the country is found in Karnataka.
As per the directions of Apex Court, mining operations and transportation in Bellary district were suspended till further orders. On 5th August 2011, the Apex Court permitted two mines of NMDC in the Bellary district to produce iron ore to the extent of one million tones per month commencing from 6th August 2011 till further orders and mining operations have been restrained in 142 mines by Court directions on account of environmental hazard in the State of Karnataka, and 40,000 (estimated) workers have been affected by this ban. Further vide directions dated 26th August 2011, mining activities in districts of Tumkur and Chitradurga in Karnataka have also been suspended by the Supreme Court.
Mr Dinsha Patel minister of state for mines (independent charge) informed the Rajya Sabha Karnataka state government detected 12891 cases of illegal mining of minor and major minerals for the period June, 2006 till December, 2009, and for the year 2010-11, it has reported 6476 cases of illegal mining.
Details of iron ore produced illegally in Karnataka are not maintained centrally. As per the National Mineral Inventory maintained by the Indian Bureau of Mines, 34.91% of total iron ore resources in the country is found in Karnataka.
As per the directions of Apex Court, mining operations and transportation in Bellary district were suspended till further orders. On 5th August 2011, the Apex Court permitted two mines of NMDC in the Bellary district to produce iron ore to the extent of one million tones per month commencing from 6th August 2011 till further orders and mining operations have been restrained in 142 mines by Court directions on account of environmental hazard in the State of Karnataka, and 40,000 (estimated) workers have been affected by this ban. Further vide directions dated 26th August 2011, mining activities in districts of Tumkur and Chitradurga in Karnataka have also been suspended by the Supreme Court.
Iron ore may remain below USD 140 as Chinese mills limit purchases
Tuesday, 20 Dec 2011
Bloomberg quoted Mysteel.com said iron ore prices may remain below USD 140 per ton as Chinese steel mills, the world biggest consumers limit purchases on profitability concerns.
Mr Chen Zhenxing a Shanghai-based analyst at the research firm “Iron ore above USD 140 may force steelmakers to incur losses at current steel prices. Prices may trade between USD 133 and USD 140 before the week-long Lunar New Year holiday which starts Jan 23.
He said that “Mills and traders are short of capital around the year end and that will also curb their buying activities.”
He added that “Steelmakers are trying to keep their raw-material inventories thin because the prices are increasingly volatile. They’d rather order only one or two ships from miners for the holiday and buy the rest from the spot market at ports.”
Ore prices have rebounded 13% from a year low on October 28. Prices have averaged 15% higher than last year USD 147 a ton. Steel prices have declined 11% from this year high in January.
(Sourced from Bloomberg)
Bloomberg quoted Mysteel.com said iron ore prices may remain below USD 140 per ton as Chinese steel mills, the world biggest consumers limit purchases on profitability concerns.
Mr Chen Zhenxing a Shanghai-based analyst at the research firm “Iron ore above USD 140 may force steelmakers to incur losses at current steel prices. Prices may trade between USD 133 and USD 140 before the week-long Lunar New Year holiday which starts Jan 23.
He said that “Mills and traders are short of capital around the year end and that will also curb their buying activities.”
He added that “Steelmakers are trying to keep their raw-material inventories thin because the prices are increasingly volatile. They’d rather order only one or two ships from miners for the holiday and buy the rest from the spot market at ports.”
Ore prices have rebounded 13% from a year low on October 28. Prices have averaged 15% higher than last year USD 147 a ton. Steel prices have declined 11% from this year high in January.
(Sourced from Bloomberg)
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