Macroeconomic indicators - Tsunami likely to affect global economy

Monday, 14 Mar 2011

Observers said that the earthquake and tsunami that ravaged Japan will likely have a short term effect on the global economy, shutting down Japanese factories, ports and oil refineries, but it won't derail the economic recovery.

The 8.9 magnitude quake in Japan, the world's third largest oil consuming country, forced the closure of all of the country's ports and five of its large steel mills. Car companies such as Nissan said they were closing factories until Sunday and airlines canceled flights to the country.

Ms Diane Swonk, chief economist at Mesirow Financial, said that it may seem that world events such as the turmoil in the Middle East and the Japanese tsunami are conspiring to offset the economic recovery, but the reality is that the recovery is slow because businesses are not redeploying profits rapidly. Continuing cuts to local and state governments in the US are further adding to uncertainty.

She said that "The reality is, if the economy was growing 8% to 9%, these things would be little more than noise, but they get magnified in a recovery that is very uneven. When you're on thin ice, you don't need any extra headwinds."

Still, there will be some short-term implications. Airlines have canceled flights to Japan. Production was halted at two Honda plants and at two Toyota plants, and Nissan Motor Co halted production at five plants.

Damage to steel mills might last longer. If the steel mills remain closed, demand for iron ore will drop by 20 million tons, said Jeffrey Landsberg, managing director of Commodore Research & Consultancy in New York. That will primarily affect the Australian iron ore industry and the miners there. It could also create demand for more steel from China.

Further, shipping companies might redirect their vessels as they wait to see if aftershocks and further tsunamis come after Friday's quake. In addition, if Japan's nuclear plants are shut for an extended period of time, the country will need to consume more coal, a commodity that is already at historically high prices.

Still, Mr Landsberg said, these events are relatively small in a global perspective. He said that "This is more than anything, a temporary event. I don't think it’s that long lasting impact on global recovery." (sourced:LaTimes)

NSW government coal and gas strategy under fire

Monday, 14 Mar 2011

A local Opposition MP said that a series of forums on a new coal and gas strategy have been strategically held in Labor seats where mining is well established.

The Department of Planning has held the public meetings, including one in Lithgow, on its scoping paper for the planning and regulation of new projects in New South Wales.

Ms Pru Goward the Liberal member for the Southern Highlands said that there are proposals for coal and coal seam gas projects in her region, as well as existing gravel, soil and rock mines.

She said that a forum should also be held in the Goulburn region so local residents can have a say on how mining developments are managed. She added that "We have an action group in the Southern Highlands that does keep people informed, but as far as the State Government is concerned there's been absolute silence on this issue. The people of the Southern Highlands and Goulburn have been totally ignored."

She said that gravel, soil and rock mining is already affecting local communities and proposed coal, and coal seam gas mines in the Southern Highlands could destroy the environment. She added that "These will both be potentially environmentally devastating. That's why the department of planning has to come here. It's all very well to hold meetings up in the Hunter where people are used to it. We need to get the department of planning to step in early and listen to the concerns of people before this area is devastated." (sourced abc.net.au)

Indian government update on land for mining to private companies

Monday, 14 Mar 2011

Mr Dinsha Patel Indian minister of state (independent charge) for mines informed the Lok Sabha that the state governments are competent to grant mineral concessions including Reconnaissance Permit, Prospecting Licence and Mining Lease under the provisions of the Mines and Minerals Act 1957 subject to prior approval of the central government.

Subsequent to the prior approval of the central government, mining leases etc are executed by the state governments with the mining agencies after following the due procedures ie obtaining forest and environment clearances and approval of mining plan from the Indian Bureau of Mines.

Whilst processing the proposals recommended by the State Governments for prior approval of the Central Government, the Ministry of Mines examines the same in the light of the provisions of the MMDR Act, 1957, the Mineral Concession Rules, 1960 and the guidelines framed in this regard and where necessary, in consultation with the State Governments and specialized agencies like the Indian Bureau of Mines, the Geological Survey of India and the Department of Atomic Energy. The Ministry of Mines is conscious of its responsibility to ensure that the mineral concession regime functions in a transparent and efficient manner. In this regard, the Ministry has, in consultation with the State Governments, issued the following guidelines:-

1. Comprehensive guidelines dated June 24th 2009, in order to bring more clarity in processing the mineral concession proposals. The guidelines also seek to ensure application of uniform criteria by the State Governments while examining and recommending proposals to the Central Government.

2. Guidelines dated February 9th 2010 on ‘special reasons’ to be adopted by all State Governments while recommending a mineral concession proposal in favour of a later applicant in a non notified area.

3. Guidelines dated October 13th 2010 regards maps in order to ensure that the areas recommended by the State Governments for mineral concessions are clearly demarcated.

Japanese ports sustain major damage,some out for months

Mon Mar 14, 2011 8:44am GMT

* Ports in Tokyo, south of capital resume normal ops
* Japan assesses damage to ports north of Tokyo
* Closure of ports to cost Japan $3.4 bln per day

By Chikako Mogi and Randy Fabi

TOKYO/SINGAPORE, March 14 (Reuters) - Japanese ports handling as much as 7 percent of the country's industrial output sustained major damage from last week's earthquake, disrupting
global supply chains and causing billions of dollars in losses, industry officials said.

Japan has begun assessing the damage to port infrastructure, vital to receiving aid, commodities and goods for rebuilding areas devastated by the 8.9 magnitude quake and tsunami that are
likely to have killed more than 10,000 people.

The box shipping industry was seen as the most strongly affected by the disaster as the destroyed ports handled containerised cargo for Hitachi Ltd. , Daikin Industries, and dozens of other companies.

"The short-term impact on economic activity could be greater than after the Kobe earthquake," said Jiyun Konomi, Tokyo-based analyst with Nomura Securities, referring to the 1995 disaster
which killed 6,000 people.

"Following the Kobe earthquake ... activity did not return to pre-earthquake levels within three months for freight transportation."

Tokyo and all ports south of Japan's capital were operating normally after briefly shutting down operations following Friday's disaster, while the rest of the country's ports were being assessed for damage, a shipowner and port official said.

"Ports south of Tokyo are all operational, ports north of Tokyo are still under evaluation," said a shipowner based in Tokyo.

The closure of the ports was expected to cost Japan more than $3.4 billion in lost seaborne trade each day, according to shipping trade publication Lloyd's List Intelligence. Maritime trade in the world's No. 3 economy totalled $1.5 trillion last year.

WORST HIT

The northeast coast ports of Hachinohe, Sendai, Ishinomaki and Onahama were so severely damaged by Friday's disaster that they were not expected to return to operation for months, if not years. The ports were medium-sized facilities that handled mostly containers, but also some fuel products and dry bulk goods.

"These ports will need a lot of time until they can be fully restored," said Tetsuya Hasegawa, operation manager at Heisei Shipping Agencies in Tokyo, told Reuters.

Japan's ninth-largest container port, Kashima, and the smaller port of Hitachinaka sustained milder damage and both could be back in operation within weeks, he said.

The tsunami also destroyed dozens of vessels, including three of Kawasaki Kisen Kaisha's panamax ships.

The disaster was expected to delay oil shipments and cause major port congestion.

"Our channels indicate that crude currently en route to Japan will likely be discharged in India or elsewhere in Asia, with the refined products carried on to Japan once ports re-open," said Michael Webber, analyst at Wells Fargo Securities.

Grains shipments, however, were not yet affected following the quake.

"Of Japan's some dozen major ports where bulk carriers or tankers can dock, only two are damaged," said Nobuyuki Chino, president of Unipac Grain.

"Imports of grain to Japan therefore are not affected."
(Additional reporting by Luke Pachymuthu; Editing by Clarence Fernandez, sourced:Thomson Reuters)

Global supply chain rattled by Japan quake, tsunami

Mon Mar 14, 2011 8:55am GMT

* High tech components, steelmakers among suppliers affected
* Rolling power blackouts likely to disrupt output for some time
* Some producers talking to alternative suppliers
* Shares of Toyota, Sony fall more than 7 pct

By Miyoung Kim and Clare Jim

SEOUL/TAIPEI, March 14 (Reuters) - Global companies from semiconductor makers to shipbuilders faced disruptions to operations after the earthquake and tsunami in Japan destroyed vital infrastructure and knocked out factories supplying everything from high-tech components to steel.

Thousands of people have been killed and millions have been left without water, electricity, homes or heat after Friday's 8.9 magnitude quake triggered a massive tsunami which tore across a wide swathe of coastline north of Tokyo.

The earthquake has forced many firms to suspend production and shares in some of Japan's biggest companies tumbled on Monday, with Toyota Corp and Sony Corp falling 8 percent and 9 percent, respectively.

Plant closures and production outages from Japan's host of high-tech companies were among the biggest threats to the global supply chain, analysts said.

"Japan remains critical to the global tech food chain," analysts at CLSA said in a report. "Beyond damage to facilities, supply chain disruptions driven by road-port-power outages are key factors to watch," CLSA said, estimating a fifth of all global technology products are made in Japan.

Korean shipbuilders and U.S. solar power companies were among other companies facing the threat of disruptions to supply, but with initial damage assessments still being made, companies and analysts said it was too early to accurately gauge how long disruptions might last.

Rolling power blackouts are likely to affect Tokyo and surrounding areas over the next few weeks, adding to the existing challenge of inspecting and repairing north Japan plants amid continuing aftershocks and the threat of major radiation leaks from damaged nuclear power plants.

KOREAN COMPANIES HIT

Japanese ports handling as much as 7 percent of the country's industrial output sustained major damage from the earthquake, with most seen out of operation for months.

Companies in neighbouring South Korea, which depend heavily on Japan supplies such as LCD glass, chip equipment, silicon wafers and other products to produce semiconductors, were some of the most affected.

Hynix Semiconductor , the world's No.2 memory chipmaker and a rival of Japan's quake-hit Toshiba Corp and Elpida Memory , said it was concerned the quake may weaken consumer demand further and disrupt supplies of chip components.

"It could give a boost to battered chip prices but that's a short-term impact from disrupted supplies by Japanese companies," said Kim Min-chul, chief financial officer at Hynix. "Longer-term we are more concerned about the quake reducing overall consumer demand and disrupting supplies of chip components and equipment, which could interrupt our production as well."

Hynix shares surged almost 9 percent on expectations of a short-term boost to chip prices and reduced competition, while shares in Toshiba, a conglomerate whose products include semiconductors and nuclear reactors, dived 16 percent.

Toshiba, which supplies more than a third of the NAND memory chips used worldwide in devices such as Apple's hot-selling iPad, said it was starting the process of restarting a chip factory in Iwate, northern Japan.

Shares of Shin-Etsu fell 6.7 percent in Tokyo, while rival silicon wafter makers Sumco Corp ended flat in a Tokyo market that closed down 6.2 percent.

Spot prices for DRAM chips, mostly used in personal computers (PC), had started rising in China, chip price tracker DRAMExChange said.

"Especially for PC and system manufactures, they need to be more proactive in DRAM inventory for the upcoming peak season," it said in a note.

Nokia , the world's largest mobile phone maker, said it was investigating the impact on supplies.

About 12 percent of components used by Nokia were sourced in Japanese yen but the amount of Japanese components was likely larger in its phones as Nokia has recently renegotiated its supplier contracts in Japan to cut risks from swings in the value of the yen.

"Until we have concrete information to share, it would be inappropriate to speculate on the possible impact to Nokia," a spokesman said.

STEEL, SOLAR

Companies reliant on Japanese steel such as South Korean shipbuilders were also expected to face supply constraints or higher prices due to disruptions caused by the quake and its aftermath.

South Korea houses the world's top three shipbuilders -- Hyundai Heavy Industries , Daewoo Shipbuilding and Marine and Samsung Heavy Industries .

"The earthquake has reportedly affected around 20 percent of the Japanese steel production capacity," said Kim Hyun-tae, an analyst at Hyundai Securities in Seoul. "It will disrupt production in Japan, one of the major steel producers exporting 40 percent of its output. In contrast, steel demand will rise for damage restoration."

Nippon Steel Corp , the world's No.4 steelmaker, said on Sunday it resumed shipments from all its steel plants except its Kaimishi facility in northern Japan. Rival JFE Holdings said on Monday it was forced to stop shipments at one plant near Tokyo due to a power outage.

On Monday, JFE Steel Corp , the world's No.5 steelmaker, halted production at a plant near Tokyo and No.4-ranked Nippon Steel suspended operations at two small plants.

"If there is a 10 percent rise in steel plates, it can result in a 1.5 percent fall in the operating profit margin for shipbuilders," said SK Securities analyst Lee Ji-hoon, adding roughly 15 percent of steel plate supplies for Korean shipbuilders come from Japan.

Korean steel maker POSCO was expected to benefit from tighter supplies and pressure on prices. Its shares rose almost 9 percent in Seoul.

The earthquake also raised risks of lower production from Japanese manufacturers of polysilicon and wafers -- materials found in solar panels that convert sunlight into electricity.

Credit Suisse expects supply problems at solar wafer maker M. Setek Co, a unit of AU Optronics , whose plant is situated near Sendai town, close to the epicenter of the quake.

US solar panel maker SunPower Corp could be vulnerable to wafer supply disruption as it relies on M. Setek for up to 20 percent of its supplies or about 200 megawatts, Credit Suisse said.

An AU spokesman said initial assessment at the M. Setek plant showed no major damage but it was unclear when production would resume.

Taiwan's TSMC , the world's largest contract maker of semiconductors, said there was no immediate threat to supplies.

"For raw materials like raw wafers, gases and chemicals and spare parts, we have enough inventories to keep things running for at least 30 days," said TSMC spokesman Michael Kramer.

Other high tech producers including Taiwanese smartphone make HTC said operations and components supply had not been affected but they would be talking to alternative suppliers and monitoring the situation in Japan. (Additional reporting by Hyunjoo Jin and Ju-min Park in SEOUL, Tarmo Virki in HELSINKI and Leonora Walet in HONG KONG; Writing by Lincoln Feast; Editing by Anshuman Daga and Dean Yates, sourced Reuters)

Tags :Korean companies hit, Toshiba, Hynix, chipmaker, Sumco Corp, Nippon Steel, JFE, POSCO, Credit Suisse,

Deals of the day -- mergers and acquisitions

Mon Mar 14, 2011 9:04am GM

March 14 (Reuters) - The following bids, mergers, acquisitions and disposals involving European, U.S. and Asian companies were reported by 0900 GMT on Monday.

** Spanish power utility Iberdrola said it needed 3 billion euros ($4.18 billion) in additional financing for an aquisition in Brazil, buying back its Renovables unit .

** Cellcom Israel has offered to buy its sister company

Netvision for about 1.5 billion shekels ($421 million) in cash, Israel's largest mobile phone operator said.

** U.S. private equity firm Mount Kellett Capital Management along with two Indian firms are close to buying 35 percent in pharma retailer MedPlus Health Services for 4.1 billion rupees ($91 million), the Times of India reported on Monday.

** Japan's Nippon Life Insurance Company is buying a 26 percent stake in India's Reliance Life Insurance for $680 million, the Indian company said in a statement.

** France Telecom and Kuwaiti logistics group Agility are to acquire a 44 percent stake in fast-growing Iraqi mobile operator Korek Telecom, the groups said in a joint statement.

** State-run Steel Authority of India said it is conducting a joint feasibility study with Japan's Kobe Steel for a steel plant and a 1,000 megawatt gas-based power plant in north India.

** Zain approved an offer by Saudi billionaire Prince Alwaleed's Kingdom Holding and Bahrain Telecom (Batelco) for its Saudi assets, paving the way for completion of a $12 billion stake deal with UAE's Etisalat .

** Furniture retailer JD Group said it has agreed to buy Steinhoff's South African retail unit for about 3 billion rand ($436.1 million).

** Care homes operator Southern Cross Healthcare Group said it had walked away from offer talks and was instead looking to its landlords and the government to help tackle its increasingly precarious financial situation.

** British printing company St Ives Plc said it agreed to sell its loss-making magazine business for 20 million pounds ($32.5 million) to a unit of private equity firm Walstead Investments Ltd.

** Spanish oil company Repsol said on Monday private investors have agreed to buy 3.83 percent of its Argentine unit YPF at $42.4 per share.

** Troubled company AssetCo Plc , the largest outsourcing partner to London Fire Brigade, rejected a fresh takeover approach calling it "opportunistic", exactly a month after its short-term funding issues punctured offer talks with a third party.

(Compiled by Krishnakali Sengupta in Bangalore,sourced:Reuters)

Ncondezi Coal plans to invest USD 400 million

Monday, 14 Mar 2011 |Reuters

Mozambique coal company Ncondezi plans to invest up to USD 400 million in the Zambezi coal basin and is expected to start producing coal by 2015.

Mr Graham Mascall CEO of Ncondezi said that "We will invest between USD 380 and USD 400 million by (2019).”

Ncondezi is planning to produce coal in the Zambezi coal basin of Mozambique in the same area where mines are being developed by Brazilian mining giant Vale and Riversdale Mining.

It also hopes to export 10 million tonnes a year of thermal coal used to fuel power stations to the Indian market by 2015.
Mr Mascall said that "We start by producing 2.5 million tones on coal by the first quarter of 2015 then expand our output adding that the group may export coal to India, Brazil and China.”

Power ministry rejects conditional nod for Orissa UMPP coal fields

Monday, 14 Mar 2011 |By ET

The Indian power ministry has rejected the environment ministry's precondition of shelving two coal mining projects as a tradeoff for granting clearance to a third coal block of the 17,000 crore ultra mega power project at Bedabahal in Orissa. This development would make another deferment of bidding for the 4000 MW project inevitable.

Indian environment minister Mr Jairam Ramesh has granted mining approval to the coal block on the condition that NTPC and Orissa Power Generation Corporation give up their respective coal blocks, Dulanga and Manoharpur, in the vicinity.

While NTPC will mine the Dulanga block for its various power projects, Orissa Power Generation Corporation will use coal from the Manoharpur blocks to fire its 1,320 MW project at Jharsuguda.

Mongolia seeks balanced growth to avoid Dutch disease from mining boom

Monday, 14 Mar 2011

Mongolia needs to look beyond the coal and copper mines that are driving its economic boom to find a more balanced model of growth.

Mr Sukhbaatar Batbold PM of Mongolia said that investment in mining projects and speculation on the wealth they will create in the world’s most sparsely populated nation have made Mongolia’s tugrik the best-performing currency since the beginning of last year. That’s putting exports such as cashmere at a disadvantage and adding costs to newer industries such as tourism, food production and metal processing.

Mr Batbold said that it is important to have a good mining industry. But it is a tool of moving many other things forward. What we want to focus on is creating jobs in many other industries.

Mongolia needs to avoid developing Dutch disease where the financial benefits of a resource boom lead to a hollowing out of other sectors, according to the World Bank. Sandwiched by Russia’s far East to the north and 1.3 billion strong, resource hungry China to the south, the government is looking for ways to lessen its vulnerability to competition from its giant neighbor and reduce its reliance as a customer.

Mr Rogier van den Brink lead economist for Mongolia at the World Bank said that “Mongolia can’t compete with China on wages but it can certainly find areas in the Chinese economy where it could have an edge such as in cashmere meat and services. Diversifying from resources would be a solution similar to what the Dutch found to combat the resource disease.”

The discovery of gas in the Netherlands drove up inflation and damaged manufacturing. In Mongolia, Vale SA and Xstrata Plc are leading six groups bidding for 1 billion tonne concession at the Tavan Tolgoi coal project. Rio Tinto is developing the Oyu Tolgoi copper and gold deposit which it expects will account for 30 percent of Mongolia’s gross domestic product when completed.

The country also holds oil, potash, iron ore, uranium and the rare earth minerals used in Toyota Motor Corporation hybrid cars and Raytheon Company’s Tomahawk cruise missiles. Plans this year to begin mining part of Tavan Tolgoi and preparatory work for the 2012 start up of Oyu Tolgoi may cause the economy to expand 33 percent in dollar terms. That compares with a 10 percent growth in local currency terms. (sourced:bloomberg)

Australian miners to benefit from iron ore export duty by India

Monday, 14 Mar 2011

The Australian reported that Australian miners Rio Tinto and BHP Billiton look set to profit from India's attempt to keep its iron ore at home after Indian government announced it would quadruple export duties on the raw material.

Analysts said that India's move is expected to keep iron ore prices near record levels, with the latest quarterly pricing contracts struck at about USD 180 per tonne.

China absorbs much of the iron ore sent from India, the world's third largest exporter of the crucial steel ingredient behind Australia and Brazil, and any increase in duties will likely be passed on by its producers to the Chinese consumer, forcing up the global price.

One market insider said that "The immediate impact is potentially positive in the sense that India is the marginal cost producer in the market and when supply is as tight as it is at the moment, then these export duties get passed on, which gets added on to the global spot price. Assuming China can continue to pay, the price will go up and everyone who sells into the seaborne market will benefit."

Mr Zhu Xi'an, Beijing based analyst at Mysteel.com, said the new restrictions would help support the high price of iron ore as Indian export volumes dropped, following state restrictions introduced last year in several mineral rich Indian provinces. He added that "The proportion of Indian ore coming into China has dropped from 25% in 2005 to 15.6% in 2010. The restrictions and increase of tax will benefit other ore suppliers, including Australian mines."

But the move could also be a mixed blessing for smaller Australian miners operating within the Indian market, such as Perth based NSL, which bought up two small iron ore interests in India in 2009 to feed China's insatiable demand. (Theaustralian)

Vale opens lab to test iron ore in Oman

Monday, 14 Mar 2011 |Timesofoman

Vale inaugurated a new laboratory designed to test iron ore, raw materials and direct reduction pellets using quality assurance processes.

The laboratory utilizes innovative designs with advanced automation and interface solutions including Laboratory Information Management System. These processes will help minimize and manage errors through the application of suitable corrective measures to ensure consistent quality pellets for steel customers in the region.

Mr Marcus Beluco COO stated that “This inauguration marks the culmination of over two years of intensive planning. The laboratory will seamlessly incorporate new testing and innovative processes to the palletizing and steel industries, contributing to the development of quality assurance and customer service.”

He added that “The laboratory will also allow the achievement of optimum sample flow by managing process changes in a more advanced manner while maintaining ISO standards.”

Spread over two floors, the laboratory consists of physical, chemical and metallurgical sections each designed to test specific characteristics of the pellets. In addition, the new facility is equipped with spectrometers, specialized furnaces, a waste water treatment system and gas detectors.

The laboratory is managed by a team of experienced professionals including young Omani graduates extensively trained in Sohar, Muscat and Brazil to be able to fully manage the advanced equipment without any complications.

NTPC to form JVs for foreign plants in 3 months

Monday, 14 Mar 2011 | Reuters

India's top power utility NTPC plans joint ventures in three months to build USD 3.5 billion power plants in Bangladesh and Sri Lanka.

In August, NTPC agreed with Bangladesh Power Development Board to set up two coal fired power plants of 1320 MW capacity each in an equal partnership venture. NTPC has also agreed to set up a 500 MW plant in Sri Lanka at a cost of about USD 500 million.

Mr Arup Roy Choudhury told Reuters in an interview that NTPC, whose 85% of current 33.2 GW capacity is coal based, has no plans to acquire overseas coal mines for at least two years as supplies for existing plants have been locked in.

I He said that "We plan to sign agreements on these two projects in 2 to 3 months with local joint venture partners.”

He said that NTPC which generates about 30% of the country's power, plans to add 25,000 MWs of electricity by 2017. Mr Roy Choudhury said that "Every third bulb in the country is lit by NTPC.”

While India has the world's fourth largest coal reserves, its coal imports have grown rapidly as Asia's third largest power producer seeks to step up capacities to end blackouts.

Power firms, including Reliance Power, TATA Power Co and Adani Enterprises have acquired coal assets overseas besides importing coal from Russia to power world's second fastest growing major economy.

But NTPC has no such plans at least for next two years.

He said that "We already have order for next two years in hand. I don't expect any overseas coal mine acquisition in at least two years. That might happen after two years, but definitely not now. We are not in a hurry to acquire overseas coal mines at least in two years."

India's coal imports in the current fiscal is estimated at 137 million tonne, junior coal minister Mr Pratik Prakashbapu Patil told lawmakers on Wednesday.

Union leader arrested in DGM burning case

Monday, 14 Mar 2011 |By PTI

PTI reported that 10 days after the deputy general manager of a private steel plant was burnt alive by agitating workers at Titlagarh, a labour union leader was arrested here in connection with the incident.

Mr Gouri Shankar Mishra was arrested from his relative's house last night on the charge of killing Mr Radheshyan Ray, Deputy General Manager of Powmex Steel.

With the arrest of Mishra, the number of arrests made in the case rose to ten, police said adding that he was taken to Titlagarh in Balangir district this morning.

Ray succumbed to severe burns after his jeep was set ablaze by a group of disgruntled workers outside the factory, a unit of Graphite India Ltd, when he was going out for lunch.

Three days after the incident, the company declared a lock out of the factory.

Japanese companies may set up steel plants in India

Monday, 14 Mar 2011 |By ET

ET reported that deadly earthquake in Japan could likely push steel companies from that country to speed up plans to build manufacturing presences in safer and low cost countries such as India.

The report quoted some industry executives who have collaborated with Japanese steelmakers for joint ventures as highlighting this possibility.

Mr CS Verma chairman of SAIL, which has a tie up with Kobe Steel to use low grade iron ore for steelmaking, said that “It is too early to say anything, but definitely, Japanese companies should explore the idea of having larger manufacturing plants in India as we have the market as well as resources here.

Apart from a safety perspective, the strong steel demand pattern in India can be attractive for the technologically advanced country like Japan, which has established its supremacy in making high tensile sheets for car bodies and for use in consumer goods.

Japan’s top four steelmakers Nippon Steel, JFE Steel, Sumitomo Metals and Kobe Steel already have a presence in India through joint ventures.

The earthquake and tsunami has affected major steelmakers along Japan’s Pacific coast. The coke oven gas plant at JFE Steel’s Chiba works caught fire. The integrated works in raw materials yards on Tokyo Bay such as Nippon Steel’s Kimitsu works and JFE Steel’s Chiba and Keihin works have also been affected. The most affected region, Sendai city itself is home to JFE Bars & Shapes and Itoh Steel.

POSCO war Zone - PPSS stages rally

Monday, 14 Mar 2011 by BL

It is reported that the villagers who have been opposing steel plant proposed to be set up by POSCO took out a rally and renewed their resolve to fight against the project.

Mr Abhaya Sahu president of POSCO Pratirodh Sangarm Samiti, which has been spearheading the anti POSCO agitation, said “We will not allow the steel plant to come up in earmarked villages. It could come up only over the bodies of unarmed people fighting against displacement. The villagers have legitimate rights over the land under the Forest Rights Act.”

Rally was organised by the Samiti at Balitutha on the fringes of the proposed steel project area in an apparent bid to galvanize the dwindling support base.

The rally was attended by leaders of the Congress, the CPI(M), the CPI, the Forward Bloc, the Samajwadi Party, the Rashtriya Janata Dal, the CPI(M-L), and the CPI(M-L) New Democracy. Leaders of several mass movements also took part in the rally.

Japanese tsunami to affect SAIL plant - Government

Monday, 14 Mar 2011 By ET

India’s union minister of state for steel Mr Beni Prasad Varma said that tsunami in Japan would also affect country's first gas based steel plant being set up by Steel Authority of India in Jagdishpur.

Mr Verma said that "Work on the plant will start after sometime as it is to be set up with the cooperation of Kobo Steel of Japan, which has been hit by tsunami"

Mr Varma told reporters that application has been moved for gas supply to the plant and a letter would be send to the Prime Minister requesting to expedite the process.

He said that "The plant is being set up with a cost of INR 5,000 crore and the work will be completed in three years.”

The minister said that modern steel, which is as of now being imported, would be manufactured at the plant. He said that the plant would provide employment to 4,000 youths and priority would be given to local residents, whose land has been acquired for the project.

Dhamra Port to go operational in April - CEO

Monday, 14 Mar 2011 By PTI

The INR 3,200 crore Dhamra Port in Orissa, a 50:50 joint venture between TATA Steel and Larsen & Toubro is ready and will go operational next month.

A top company official said that Dhamra Port Company Limited has so far invested INR 2,900 crore out of the total project cost of INR 3,239 crore and almost 100% work on the project has been completed.

Mr Santosh Mohapatra CEO of Dhamra Port Company' said that told PTI that "The port is now ready. It will go operational in April this year. We have completed 100% work of the port including the construction work for the 62 kilometer rail link from Dhamra to Bhadrak on the main Howrah-Chennai line.”

Situated between Haldia and Paradip, the port at Dhamra will be the deepest of India with a draught of 18 meters, which can accommodate super Capesize vessels up to 180,000 DWT.

DPCL has recently entered into a sister port relationship agreement with the US based Port of Seattle. The pact is aimed at exchange of information on port users, technology transfer and sharing of best practices between the two ports.

The port, which aims to serve industries in Jharkhand, Orissa and Chhattisgarh, would initially deal with bulk cargo like coal, iron-ore, chromite, bauxite and steel.

Tags :180000 DWT, DPCL, Jharkhand, Orissa, Chhattisgarh, coal, iron ore, bauxite, steel, bulk cargo,

Minister revokes state miner’s privileges

Minister strips company of exemptions granted by former minister Buyelwa Sonjica in 2008

By Allan Seccombe
Mon, Mar14, 2011 06:32:46 AM

MINERAL Resources Minister Susan Shabangu pulled state-owned mining company African Exploration Mining & Finance Corporation into line with private firms on Friday, stripping it of exemptions granted by former minister Buyelwa Sonjica during the Eskom crisis in 2008.

There has been concern in mining circles that African Exploration would receive preferential treatment from the Department of Mineral Resources when applying for prospecting or mining rights and that certain conditions for private companies would not apply to the state miner, giving it an unfair advantage.

Ms Shabangu and Sandile Nogxina, the director-general of the department, have consistently said this will not be the case.

Ms Shabangu told the Prospectors and Developers Association of Canada in Toronto there was no reason for African Exploration to have these exemptions to four sections of legislation related to the granting of mining and prospecting permits, and the removal of minerals for stockpiling for security of supply.

On Friday, the department said it was withdrawing all exemptions granted to African Exploration under the Mineral Resources and Petroleum Development Act and the notice would appear in the Government Gazette today. The main effect of the exemptions was to speed up the processing and granting of prospecting and mining rights to African Exploration compared with a private company. Where a private company could wait for months, the state entity could be granted rights within a week. That has now fallen away.

An example would be the immediate acceptance of a prospecting right application by African Exploration, while private companies had to wait 14 days to hear whether their application was accepted or rejected.

Department spokesman Bheki Khumalo said African Exploration had submitted environmental management plans, environmental impact assessment studies, work programmes and social and labour plans for its ventures, much like private companies.

It was not exempted from these requirements.

The Chamber of Mines has welcomed the formation of a state-owned mining company but stressed that it must be treated no differently from private companies. "Our position is based on an assurance from government through the Department of Mineral Resources that this company will not be given an unfair competitive advantage to private- sector companies as this would send the wrong message to investors," chamber CEO Bheki Sibiya said last month.

African Exploration last month launched its first mining project, a R130m coal mine near Ogies in Mpumalanga, to supply Eskom power plants. The mine will start production at 800000 tons, ramping up to double that and potentially as much as 3- million tons a year.

African Exploration CEO Sizwe Madondo said the second project in its pipeline was an oil- from-torbanite venture.

African Exploration has finalised a feasibility study on the R2bn oil shale or torbanite project near Bethal in Mpumalanga. It would need to bring in a partner to help fund and provide the technology for the project, which would produce 10000-15000 barrels of oil a day from the third quarter of 2013, said Mr Madondo. (Business Day)

China exports CT80 coiled tubes for the first time

Monday, 14 Mar 2011

It is reported that Shaanxi Province based Chinese pipe maker Baoji Petroleum Steel Pipe Co has announced that a shipment consisting of its CT80 coiled tubes in diameters of 38.1mm and 44.45mm is now on its way to the Middle East.

The shipment marks the first time CT80 coiled tubes have been exported from China.

CT80 coiled tubes are mainly applied in the oilfield drilling activities.

In June 2009, Baoji Petroleum Steel Pipe produced the product in question for the first time. To date, apart from Baoji Petroleum Steel Pipe, just a few producers in Japan and France can manufacture this kind of product.

Tags : oilfield drilling activities, Japan, France

Wuyang Steel exports 18000 tonnes of steel plate in February

Monday, 14 Mar 2011

It is reported that Hebei Province based Chinese steelmaker Wuyang Iron and Steel Co Ltd exported 18,000 tonnes of steel plate in February this year marking its best monthly export performance since the outbreak of the financial crisis.

Wuyang Steel mainly exports boiler plate, container plate, thick Z-plate and offshore platform steel plate to be used in hydroelectric and wind power projects in South America as well as in oil storage tank manufacturing in the Gulf region. In addition, Wuyang Steel also exports its steel plates to countries such as South Korea, Vietnam and Iran.

In H1 2010 Wuyang Steel exported 92,000 tonnes of wide and thick plate, almost equal to the company total export volume for the whole of 2009.