January 31, 2011
Reuters reported that Ukraine No 1 steel mill, owned by ArcelorMittal, raised crude steel production in 2010 to 6.13 million tonnes from 5.04 million tonnes in 2009.
Rolled steel production rose to 5.41 million tonnes last year from 4.50 million, while pig iron output rose to 5.32 million from 4.42 million a year earlier.
Ukrainian industry officials said this month that local steel companies produced a total of 32.7 million tonnes of crude steel in 2010 but planned to increase output by about 6% in 2011 to 34.5 million tonnes.
Steel producers' union Metallurgprom forecast rolled steel output to rise to 32.8 million tonnes this year from 30.68 million in 2010, while pig iron output would jump to 28.9 million tonnes from 27.4 million.
But analysts said Ukraine's key export oriented steel sector, largely dependent on the situation on the world market, is unlikely to show a significant rise in output in 2011 due to unstable demand from abroad. (sourced:reuters)
Showing posts with label Monday. Show all posts
Showing posts with label Monday. Show all posts
Tuesday, February 1, 2011
Monday, January 31, 2011
Bukit Asam Expects Coal Sales to Rise 30% This Year
By Bambang Djanuarto
Monday, Jan 31, 2011
PT Tambang Batubara Bukit Asam expects coal sales volume to gain about 30 percent this year as the Indonesian state-owned miner plans to produce more of the fuel to meet increasing demand, President Director Sukrisno said.
Sales may increase to 16.9 million metric tons this year from 12.95 million tons last year while output may rise to 17.6 million tons from 13.1 million tons, said Sukrisno.
“Demand of coal for domestic and global markets will continue to increase,” Sukrisno, who uses one name, told parliament members in Jakarta today. “Local consumption will rise significantly, especially for power projects.”
Indonesia, the world’s largest thermal coal exporter, is planning to burn more of the fuel to make up for falling crude oil production from aging fields, which led to the country withdrawing from the Organization of Petroleum Exporting Countries in 2008. PT Perusahaan Listrik Negara, the country’s state utility, may more than double its annual coal demand to 95.3 million tons by 2015.
Tanjung Enim, South Sumatra-based Bukit Asam has allocated 1.8 trillion rupiah ($199 million) for capital spending this year to boost production, Sukrisno said. The company expects output to climb to 50 million tons in 2015 and 80 million tons in 2018, he added.
Profit Decline
Net income in 2010 may have been lower than the previous year when the company posted 2.73 trillion rupiah of profit because of lower average coal selling price, the president director said. Profit may have fallen 25 percent to 2.04 trillion rupiah last year, according to average estimate of 19 analysts in a Bloomberg survey.
Bukit Asam average selling price fell 19 percent last year to 608,000 rupiah a ton, Sukrisno said. “An increase in sales volume could not compensate for a decline in coal price,” he said, adding the company expects the selling price to rise to 800,000 rupiah a ton this year.
Bukit Asam and Mitsubishi Corp. will jointly develop a coal-to-gas plant in Riau with an annual capacity of 6.5 million tons, Sukrisno said. The Indonesian company will also team up with Lurgi AG in a separate project in South Sumatra, he added.
Bukit Asam shares fell 2 percent to 19,750 rupiah at the 4 p.m. Jakarta time close. The stock has risen 18 percent in the past six months, outpacing the 11.5 percent gain in the benchmark Jakarta Composite index. (sourced:bloomberg)
Monday, Jan 31, 2011
PT Tambang Batubara Bukit Asam expects coal sales volume to gain about 30 percent this year as the Indonesian state-owned miner plans to produce more of the fuel to meet increasing demand, President Director Sukrisno said.
Sales may increase to 16.9 million metric tons this year from 12.95 million tons last year while output may rise to 17.6 million tons from 13.1 million tons, said Sukrisno.
“Demand of coal for domestic and global markets will continue to increase,” Sukrisno, who uses one name, told parliament members in Jakarta today. “Local consumption will rise significantly, especially for power projects.”
Indonesia, the world’s largest thermal coal exporter, is planning to burn more of the fuel to make up for falling crude oil production from aging fields, which led to the country withdrawing from the Organization of Petroleum Exporting Countries in 2008. PT Perusahaan Listrik Negara, the country’s state utility, may more than double its annual coal demand to 95.3 million tons by 2015.
Tanjung Enim, South Sumatra-based Bukit Asam has allocated 1.8 trillion rupiah ($199 million) for capital spending this year to boost production, Sukrisno said. The company expects output to climb to 50 million tons in 2015 and 80 million tons in 2018, he added.
Profit Decline
Net income in 2010 may have been lower than the previous year when the company posted 2.73 trillion rupiah of profit because of lower average coal selling price, the president director said. Profit may have fallen 25 percent to 2.04 trillion rupiah last year, according to average estimate of 19 analysts in a Bloomberg survey.
Bukit Asam average selling price fell 19 percent last year to 608,000 rupiah a ton, Sukrisno said. “An increase in sales volume could not compensate for a decline in coal price,” he said, adding the company expects the selling price to rise to 800,000 rupiah a ton this year.
Bukit Asam and Mitsubishi Corp. will jointly develop a coal-to-gas plant in Riau with an annual capacity of 6.5 million tons, Sukrisno said. The Indonesian company will also team up with Lurgi AG in a separate project in South Sumatra, he added.
Bukit Asam shares fell 2 percent to 19,750 rupiah at the 4 p.m. Jakarta time close. The stock has risen 18 percent in the past six months, outpacing the 11.5 percent gain in the benchmark Jakarta Composite index. (sourced:bloomberg)
China allows yuan swaps trade by banks
Monday, 31 Jan 2011, Reuters
SHANGHAI - China will permit designated banks to trade yuan/foreign currency swaps on behalf of their clients from March 1, the country's foreign exchange regulator said.
Non-bank clients will be allowed to sign agreements now and exchange yuan and foreign currencies, and their interest rates, at a future time, the State Administration of Foreign Exchange said late on Sunday. Currently only banks can trade yuan/foreign currencies swaps.
The reform is part of China's efforts to expand yuan business to help regionalise and eventually globalise the currency.
Under US pressure to allow the currency rise faster, Beijing has also vowed to make the yuan more flexible and market-oriented as the country gradually deregulates its capital markets.
Developing derivatives based on exchange rates will give Chinese banks and companies badly needed tools to hedge currency risks as the yuan gradually becomes more volatile in the future in line with those reforms.
"The notice on business related to yuan/foreign currency swaps of bank clients is issued in order to allow domestic economic entities to hedge risks," the SAFE said in a statement on its website, www.safe.gov.cn.
Bank branches would also be allowed to perform yuan/currency swaps on behalf of clients under the precondition that they are authorised to do so by their headquarters, the SAFE said.
Interest rates agreed to be exchanged in the swaps must not exceed the limits set by the People's Bank of China (PBOC), among other provisions set by the forex regulator, which comes under the central bank.
The PBOC is launching more derivatives linked to the yuan's exchange rate and interest rates, such as those based on the yen , the euro , the dollar , international bonds and bank deposits, as it eyes more hedging tools for Chinese companies.
For now, the yuan has moved in an average range of about 100 pips per day. While its movements are now much wider than during the time of a de facto peg before June 2010, they are still far too small to create real demand for hedging.
China's official interest rate system is completely controlled by the government, with deposits allowed to be set slightly lower than PBOC benchmarks, while lending rates may be slightly higher. (sourced:reuters)
SHANGHAI - China will permit designated banks to trade yuan/foreign currency swaps on behalf of their clients from March 1, the country's foreign exchange regulator said.
Non-bank clients will be allowed to sign agreements now and exchange yuan and foreign currencies, and their interest rates, at a future time, the State Administration of Foreign Exchange said late on Sunday. Currently only banks can trade yuan/foreign currencies swaps.
The reform is part of China's efforts to expand yuan business to help regionalise and eventually globalise the currency.
Under US pressure to allow the currency rise faster, Beijing has also vowed to make the yuan more flexible and market-oriented as the country gradually deregulates its capital markets.
Developing derivatives based on exchange rates will give Chinese banks and companies badly needed tools to hedge currency risks as the yuan gradually becomes more volatile in the future in line with those reforms.
"The notice on business related to yuan/foreign currency swaps of bank clients is issued in order to allow domestic economic entities to hedge risks," the SAFE said in a statement on its website, www.safe.gov.cn.
Bank branches would also be allowed to perform yuan/currency swaps on behalf of clients under the precondition that they are authorised to do so by their headquarters, the SAFE said.
Interest rates agreed to be exchanged in the swaps must not exceed the limits set by the People's Bank of China (PBOC), among other provisions set by the forex regulator, which comes under the central bank.
The PBOC is launching more derivatives linked to the yuan's exchange rate and interest rates, such as those based on the yen , the euro , the dollar , international bonds and bank deposits, as it eyes more hedging tools for Chinese companies.
For now, the yuan has moved in an average range of about 100 pips per day. While its movements are now much wider than during the time of a de facto peg before June 2010, they are still far too small to create real demand for hedging.
China's official interest rate system is completely controlled by the government, with deposits allowed to be set slightly lower than PBOC benchmarks, while lending rates may be slightly higher. (sourced:reuters)
Shanghai rebar hits record as iron ore stays highPublished 7:03 PM, 31 Jan 201
Monday, 31 Jan 2011, Reuters
SINGAPORE - Shanghai steel rebar futures jumped to a record on Monday as raw material iron ore prices hovered near all-time highs on tight supplies.
The most active rebar contract on the Shanghai Futures Exchange for October delivery rose 1.3 per cent to 5,104 yuan per tonne at 1556 AEDT, just off a peak of 5,110 yuan.
It was the second time that the contract chalked up a record level in less than a week, after rising as high as 5,097 yuan on January 25.
"It's the result of surging prices of raw materials over the past few months and iron ore and coking coal prices are still on the upswing," analyst at BOC International Futures Jiang Zhiwei said.
Fewer cargoes out of Brazil and India pushed spot iron ore prices to near $US200 a tonne earlier this month, a record last seen in February 2008.
Tight supplies will likely continue to support prices even with top buyer China off the market during its February 2 to 8 Spring Festival holiday.
"There is less chance of prices going down because of the supply situation but there's a cap on the rise with the Chinese out of the market," a Singapore-based trader who deals with Indian iron ore said.
"The market is very slow and I think the Indian miners are concentrating on building up their stocks before they offer it out."
Indian ore with 63.5 per cent iron ore content was quoted at $US190 to $US192 a tonne, cost and freight delivered to China, on Monday, steady from Friday, Chinese consultancy Mysteel said.
The three major iron ore indexes, based on Chinese spot prices and used by global miners to decide rates for quarterly contracts, stayed near record highs on Friday.
The Platts 62 per cent iron ore index slipped 25 cents to $US186.75 a tonne, just off the record $US187 touched on Thursday.
The Steel Index 62 per cent benchmark edged down 30 cents to $US185.30, but still near its all-time high of $US185.70 reached on January 21.
Metal Bulletin's 62 per cent gauge dipped 11 cents to $US183.76, a tad off the record $US184.43 hit last week.
Indian futures
Two Indian commodity exchanges on Saturday launched the world's first iron ore futures contracts, just days after securing regulatory approval.
But analysts say the contracts are unlikely to be considered global benchmarks anytime soon unless liquidity picks up strongly and with trading limited to domestic players.
For more on India's iron ore futures, click:
At 1530 AEDT, the March 62 per cent fines on the Multi Commodity Exchange (MCX) were up 0.7 per cent at 7,545 rupees ($US164.31) per tonne, while the March 62 per cent fines on the Indian Commodity Exchange (ICEX) rose 0.3 per cent to 8,094 rupees a tonne, according to the bourses' websites.
The price quoted on ICEX is based on cost and freight delivered to China, while the quote on MCX is on a free on board basis.
ICEX is part-owned by state-run MMTC Ltd which is the biggest Indian trader of iron ore, and MCX is the country's largest commodity exchange by turnover.
Before India's futures contracts, trading in iron ore derivatives were mostly done through forward swaps with exchanges from Singapore to the United States and Europe offering clearing services, hoping to draw steelmakers into hedging price risks.
The Singapore Exchange clears the bulk of global swaps and prices were mostly mixed on Friday.
The February contract slipped a dollar to $US179.50 a tonne and March gained $US1.50 to $US174.25.
SINGAPORE - Shanghai steel rebar futures jumped to a record on Monday as raw material iron ore prices hovered near all-time highs on tight supplies.
The most active rebar contract on the Shanghai Futures Exchange for October delivery rose 1.3 per cent to 5,104 yuan per tonne at 1556 AEDT, just off a peak of 5,110 yuan.
It was the second time that the contract chalked up a record level in less than a week, after rising as high as 5,097 yuan on January 25.
"It's the result of surging prices of raw materials over the past few months and iron ore and coking coal prices are still on the upswing," analyst at BOC International Futures Jiang Zhiwei said.
Fewer cargoes out of Brazil and India pushed spot iron ore prices to near $US200 a tonne earlier this month, a record last seen in February 2008.
Tight supplies will likely continue to support prices even with top buyer China off the market during its February 2 to 8 Spring Festival holiday.
"There is less chance of prices going down because of the supply situation but there's a cap on the rise with the Chinese out of the market," a Singapore-based trader who deals with Indian iron ore said.
"The market is very slow and I think the Indian miners are concentrating on building up their stocks before they offer it out."
Indian ore with 63.5 per cent iron ore content was quoted at $US190 to $US192 a tonne, cost and freight delivered to China, on Monday, steady from Friday, Chinese consultancy Mysteel said.
The three major iron ore indexes, based on Chinese spot prices and used by global miners to decide rates for quarterly contracts, stayed near record highs on Friday.
The Platts 62 per cent iron ore index slipped 25 cents to $US186.75 a tonne, just off the record $US187 touched on Thursday.
The Steel Index 62 per cent benchmark edged down 30 cents to $US185.30, but still near its all-time high of $US185.70 reached on January 21.
Metal Bulletin's 62 per cent gauge dipped 11 cents to $US183.76, a tad off the record $US184.43 hit last week.
Indian futures
Two Indian commodity exchanges on Saturday launched the world's first iron ore futures contracts, just days after securing regulatory approval.
But analysts say the contracts are unlikely to be considered global benchmarks anytime soon unless liquidity picks up strongly and with trading limited to domestic players.
For more on India's iron ore futures, click:
At 1530 AEDT, the March 62 per cent fines on the Multi Commodity Exchange (MCX) were up 0.7 per cent at 7,545 rupees ($US164.31) per tonne, while the March 62 per cent fines on the Indian Commodity Exchange (ICEX) rose 0.3 per cent to 8,094 rupees a tonne, according to the bourses' websites.
The price quoted on ICEX is based on cost and freight delivered to China, while the quote on MCX is on a free on board basis.
ICEX is part-owned by state-run MMTC Ltd which is the biggest Indian trader of iron ore, and MCX is the country's largest commodity exchange by turnover.
Before India's futures contracts, trading in iron ore derivatives were mostly done through forward swaps with exchanges from Singapore to the United States and Europe offering clearing services, hoping to draw steelmakers into hedging price risks.
The Singapore Exchange clears the bulk of global swaps and prices were mostly mixed on Friday.
The February contract slipped a dollar to $US179.50 a tonne and March gained $US1.50 to $US174.25.
India iron ore futures start to attract exporters
Monday Jan 31, 2011* ICEX and MCX are quick to launch contracts before SMX
* SMX sticking to its planned launch in second quarter
By Siddesh Mayenkar
By Siddesh Mayenkar
MUMBAI, Jan 31,2011 (Reuters) - The world's first iron ore futures contracts attracted small exporters in their first two days of trade in India and could weather the launch of a Singapore offer as players try to hedge near-record high prices.
"We were surprised to get speculators and physical market players, and some of the big names are already trading in our contracts," Sanjay Chandel, chief executive officer at Indian Commodity Exchange (ICEX), told Reuters.
ICEX and rival Multi Commodity Exchange (MCX) launched their iron ore futures contracts on Saturday, just days after the markets regulator gave permission for four contracts and trumping Singapore's SMX which plans its contract in the second quarter.
The most actively traded Indian ore contract on ICEX, which promises 62 percent iron content for March delivery, had gained 0.05 percent to trade at 7,269 rupees per dry metric tonne (DMT), cost and freight (CFR) delivered to China.
The most actively traded Indian ore contract on ICEX, which promises 62 percent iron content for March delivery, had gained 0.05 percent to trade at 7,269 rupees per dry metric tonne (DMT), cost and freight (CFR) delivered to China.
The March 62 percent fines on the rival Multi Commodity Exchange (MCX) was trading 0.04 percent down at 7,266 rupees a tonne, free on board.
ICEX, which is part-owned by state-run MMTC Ltd (MMTC.BO: Quote), the biggest Indian trader of iron ore, recorded volumes of 21,300 DMT, while on MCX, the country's largest commodity exchange by turnover, volumes fell a little to 9,200 DMT from Saturday, the first day of trading.
Chandel expects more corporate participation in the near-term. "Going forward, we are bullish on the commodity, as far as turnover is concerned. Many miners and exporters are already our members," he said.
ICEX, which is part-owned by state-run MMTC Ltd (MMTC.BO: Quote), the biggest Indian trader of iron ore, recorded volumes of 21,300 DMT, while on MCX, the country's largest commodity exchange by turnover, volumes fell a little to 9,200 DMT from Saturday, the first day of trading.
Chandel expects more corporate participation in the near-term. "Going forward, we are bullish on the commodity, as far as turnover is concerned. Many miners and exporters are already our members," he said.
"There are many waiting on the fence. They have plans, and discussions are on," said Chandel.
Iron ore exporters Phulchand Exports and Bagadiya Brothers have taken membership with the exchanges, a source at an exchange dealing in the commodity said. Company officials declined to comment.
Iron ore exporters Phulchand Exports and Bagadiya Brothers have taken membership with the exchanges, a source at an exchange dealing in the commodity said. Company officials declined to comment.
CRUCIAL FIRST MONTHS
Interest in iron ore futures has bubbled since the world's major miners -- Vale (VALE5.SA: Quote) (VALE.N: Quote), Rio Tinto (RIO.AX: Quote) (RIO.L: Quote) and BHP Billiton (BHP.AX: Quote) (BLT.L: Quote) -- have switched to quarterly from annual pricing.
With global spot iron ore prices heading for $200 a tonne, buoyed by demand from China, the world's biggest buyer, exchanges are vying for business in a physical market second only in size to crude oil.
Up until Saturday's launch, investors have only had forward swaps or cash-settled derivatives available to hedge risk.
"The first six months would be crucial to judge whether this (contract) would be of any help, there are chances that it might turn out well," said Gnanasekar Thiagarajan, director, Commtrendz Research.
India is the world's third-biggest iron ore exporter after Australia and Brazil, but shipments have been hit by an export ban in its southern Karnataka state.
India normally exports around 100 million tonnes of iron ore annually of which around a quarter comes from Karnataka.
Interest in iron ore futures has bubbled since the world's major miners -- Vale (VALE5.SA: Quote) (VALE.N: Quote), Rio Tinto (RIO.AX: Quote) (RIO.L: Quote) and BHP Billiton (BHP.AX: Quote) (BLT.L: Quote) -- have switched to quarterly from annual pricing.
With global spot iron ore prices heading for $200 a tonne, buoyed by demand from China, the world's biggest buyer, exchanges are vying for business in a physical market second only in size to crude oil.
Up until Saturday's launch, investors have only had forward swaps or cash-settled derivatives available to hedge risk.
"The first six months would be crucial to judge whether this (contract) would be of any help, there are chances that it might turn out well," said Gnanasekar Thiagarajan, director, Commtrendz Research.
India is the world's third-biggest iron ore exporter after Australia and Brazil, but shipments have been hit by an export ban in its southern Karnataka state.
India normally exports around 100 million tonnes of iron ore annually of which around a quarter comes from Karnataka.
Singapore Mercantile Exchange (SMX) is sticking to its planned launch of a futures contract in the second quarter. [ID: nL3E7CQ09W]
"Our product strategy timelines are not altered and remain on course as planned," Thomas McMahon, chief executive of SMX, told Reuters in a email.
"The marketplace understands the differences well. We see SMX iron ore futures as more reflective of trans-Asian, Australian and Brazilian demand and supply pricing mechanisms," he added.
SMX, controlled by India's Financial Technologies (FITE.BO: Quote), is looking at establishing a cash-settled iron ore futures contract based on the iron ore index by data provider Metal Bulletin which uses a 62 percent iron content benchmark. (Additional reporting by Manolo Serapio Jr in Singapore;editing by Jo Winterbottom & James Jukwey, sourced Reuters)
"Our product strategy timelines are not altered and remain on course as planned," Thomas McMahon, chief executive of SMX, told Reuters in a email.
"The marketplace understands the differences well. We see SMX iron ore futures as more reflective of trans-Asian, Australian and Brazilian demand and supply pricing mechanisms," he added.
SMX, controlled by India's Financial Technologies (FITE.BO: Quote), is looking at establishing a cash-settled iron ore futures contract based on the iron ore index by data provider Metal Bulletin which uses a 62 percent iron content benchmark. (Additional reporting by Manolo Serapio Jr in Singapore;editing by Jo Winterbottom & James Jukwey, sourced Reuters)
Angel upgrades JSW Steel to `Buy`
Monday, 31 JAN2011
Angel Broking has recommended `Buy` on JSW Steel with a price target of Rs 1,047 as against the current market price (CMP) of Rs 898 in its report dated Jan. 29, 2011.
The broking house gave the following rationale:
Spot iron ore prices have continued to rise: Higher crude steel production has led to an increase in international spot iron ore prices to over USD 180/tonne. However, growth in production of iron ore in China has remained flat during the past quarter. Due to crackdown on illegal mining by the government, India`s iron ore prices have increased as well.
while coking coal prices have spurted recently: The flooding in Australia during December 2010-January 2011 has severely hit mining operations in Queensland, which accounts for 50% of the world`s coking coal trade, which has resulted in spurt in spot prices of coking coal since then. The rise in spot prices is likely to result in higher contract prices for 1QFY2012.
resulting in rise in steel prices recently: The steep rise in iron ore and coking coal prices has resulted in higher steel prices across the globe. However, steel production continues to rise globally, while there is lack of clarity on demand in western economies. We believe the rise in prices of key inputs will be more than offset by the increase in steel prices during FY2012. Hence, we expect profitability of companies with low levels of integration such as JSW Steel to decline in the coming few quarters.
Valuation: JSW Steel is expanding its capacity by 3.2 mn ton from the current level of 7.8mn tonnes, thus taking its total capacity to 11mn tonnes by FY2011. Furthermore, JSW Steel will become India`s largest steel company with total capacity of 14.3mn tonnes on successful completion of Ispat Industries acquisition.
We expect the company to reap benefits of economies of scale on account of large-scale production, which should slightly destroy per unit cost of production. Also, the commissioning of the beneficiation plant by March 2011 is expected to lower iron ore cost for the company by USD 10-30/tonne.
However, rise in prices of key inputs (particularly coking coal) is likely to result in profitability decline during FY2012. At the current market price (CMP) of Rs 898, the stock is trading at 7.5x FY2011E and 5.9x FY2012E EV/EBITDA.
Given the recent decline in the stock price, we upgrade the stock to Buy from Accumulate with a revised Target Price of Rs 1,047 (earlier Rs 1,310), valuing the stock at 6.5x FY2012E EV/EBITDA. We have increased our estimates for FY2012E to factor in higher realisations. However, we have lowered our EBITDA margin estimates for FY2012E to account for higher iron ore and coking coal costs.(sourced: IRIS Exclusive via myiris.com)
Angel Broking has recommended `Buy` on JSW Steel with a price target of Rs 1,047 as against the current market price (CMP) of Rs 898 in its report dated Jan. 29, 2011.
The broking house gave the following rationale:
Spot iron ore prices have continued to rise: Higher crude steel production has led to an increase in international spot iron ore prices to over USD 180/tonne. However, growth in production of iron ore in China has remained flat during the past quarter. Due to crackdown on illegal mining by the government, India`s iron ore prices have increased as well.
while coking coal prices have spurted recently: The flooding in Australia during December 2010-January 2011 has severely hit mining operations in Queensland, which accounts for 50% of the world`s coking coal trade, which has resulted in spurt in spot prices of coking coal since then. The rise in spot prices is likely to result in higher contract prices for 1QFY2012.
resulting in rise in steel prices recently: The steep rise in iron ore and coking coal prices has resulted in higher steel prices across the globe. However, steel production continues to rise globally, while there is lack of clarity on demand in western economies. We believe the rise in prices of key inputs will be more than offset by the increase in steel prices during FY2012. Hence, we expect profitability of companies with low levels of integration such as JSW Steel to decline in the coming few quarters.
Valuation: JSW Steel is expanding its capacity by 3.2 mn ton from the current level of 7.8mn tonnes, thus taking its total capacity to 11mn tonnes by FY2011. Furthermore, JSW Steel will become India`s largest steel company with total capacity of 14.3mn tonnes on successful completion of Ispat Industries acquisition.
We expect the company to reap benefits of economies of scale on account of large-scale production, which should slightly destroy per unit cost of production. Also, the commissioning of the beneficiation plant by March 2011 is expected to lower iron ore cost for the company by USD 10-30/tonne.
However, rise in prices of key inputs (particularly coking coal) is likely to result in profitability decline during FY2012. At the current market price (CMP) of Rs 898, the stock is trading at 7.5x FY2011E and 5.9x FY2012E EV/EBITDA.
Given the recent decline in the stock price, we upgrade the stock to Buy from Accumulate with a revised Target Price of Rs 1,047 (earlier Rs 1,310), valuing the stock at 6.5x FY2012E EV/EBITDA. We have increased our estimates for FY2012E to factor in higher realisations. However, we have lowered our EBITDA margin estimates for FY2012E to account for higher iron ore and coking coal costs.(sourced: IRIS Exclusive via myiris.com)
Metals as investors bet the better Tin Prospect
Monday, 31 January, 2011 18:04 BJT
Reuters Singapore / Jakarta, January 28 Xinhua --- pushed tin prices to a record high of investors have been locked in the risk of the market, the tin can market for huge profits into the book is notorious for huge losses.
Technically speaking, market bulls in control of the right to speak, and the main exporting countries experienced heavy rains in Indonesia's tin-producing areas of the short term, the fundamentals of tin added to the charm, and land mines to be dropped, and buy long-term warming will cause a tin charm unabated. Technically speaking, market bulls in control of the right to speak, and the main exporting countries experienced heavy rains in Indonesia's tin-producing areas of the short term, the fundamentals of tin added to the charm, and land mines to be dropped, and buy long-term warming will cause a tin charm has not diminished.
However, tin is notorious for trick investors, because of limited mobility of tin make it very easy to get the book profit, it is difficult to convert these profits real money income. However, tin is notorious for trick investors, because of limited mobility of tin make it very easy to get the book profit, it is difficult to convert these profits real money income.
November 2009, Ebullio Capital Management hedge fund commodity control the London Metal Exchange (LME) stocks almost 90% of the tin and cash contracts. November 2009, Ebullio Capital Management hedge fund commodity control the London Metal Exchange (LME) stocks almost 90% of the tin and cash contracts.
February 2010, the company's assets under management fell to $ 1,470,000, and in November 2009 compared to 4,230 million U.S. dollars, after the company had liquidated some of the actual book assets, as well as some long-held, mainly for LME non-ferrous metals speculative positions. February 2010, the company's assets under management fell to $ 1,470,000, and in November 2009 compared to 4,230 million US dollars, after the company had liquidated some of the actual book assets, as well as some long-held, mainly for LME non-ferrous metals speculative positions.
"It's like the saying goes, too, as people who do not learn from history is bound to repeat it," said a dealer in Singapore. "It's like the saying goes, too, as people who do not learn from history is bound to repeat it, "said a dealer in Singapore.
"I have learned that is not to bet on in the tin. If you can not tin Shangwang strategist, you are likely to lose the bankrupt." "I have learned that is not to bet on in the tin. If you can not tin Shangwang strategist, you are likely to lose the bankrupt. "
Tin Market prospects for the better ........... To the good prospects of Wuxi City
Index of London Metal Exchange (LME) tin contract hit a record high last Friday, 29,700 dollars per tonne, this year the best performing industrial metal, recorded a 10% increase. Index of London Metal Exchange (LME) tin contract hit a record high last Friday, 29,700 dollars per tonne, this year the best performing industrial metal, recorded a 10% increase.
Reuters said analyst Wang Tao, Elliott Wave theory suggests, the tin price is USD 34,000 per tonne walking in the road. Reuters said analyst Wang Tao, Elliott Wave theory suggests, the tin price is USD 34,000 per tonne walking in the road.
Indonesia last month, tin production has been suppressed in the rain and fight the global tin supply of tin consumption accounts for nearly 30% of the estimated 2010 annual production of 105,000 tons. Indonesia last month, tin production has been suppressed in the rain and fight the global tin supply of tin consumption accounts for nearly 30% of the estimated 2010 annual production of 10.5 million tons.
Meanwhile, the status of the land reserves of refined tin in a sharp drop in the trend, which will force the main tin-producing Bangka-Belitung islands out of the mine are starting on the higher cost of offshore exploration for minerals. Meanwhile, the status of the land reserves of refined tin in a sharp drop in the trend, which will force the main tin-producing Bangka-Belitung islands out of the mine are starting on the higher cost of offshore mineral exploration.
International Tin Research Organization (ITRI) this week estimated the global tin consumption in 2010 was 360,300 tons, up 12.5%. International Tin Research Organization (ITRI) this week estimated the global tin consumption in 2010 was 360,300 tons, up 12.5%.
Tin demand in the coming years is expected to rise, analysts continue to forecast months, Indonesia's tin production due to lack of mining investment will decline. (End) Tin demand in the coming years is expected to rise, analysts continue to forecast months, Indonesia's tin production due to lack of mining investment will decline.
(Compile Lan Xiu-juan;sourced reuters)
Reuters Singapore / Jakarta, January 28 Xinhua --- pushed tin prices to a record high of investors have been locked in the risk of the market, the tin can market for huge profits into the book is notorious for huge losses.
Technically speaking, market bulls in control of the right to speak, and the main exporting countries experienced heavy rains in Indonesia's tin-producing areas of the short term, the fundamentals of tin added to the charm, and land mines to be dropped, and buy long-term warming will cause a tin charm unabated. Technically speaking, market bulls in control of the right to speak, and the main exporting countries experienced heavy rains in Indonesia's tin-producing areas of the short term, the fundamentals of tin added to the charm, and land mines to be dropped, and buy long-term warming will cause a tin charm has not diminished.
However, tin is notorious for trick investors, because of limited mobility of tin make it very easy to get the book profit, it is difficult to convert these profits real money income. However, tin is notorious for trick investors, because of limited mobility of tin make it very easy to get the book profit, it is difficult to convert these profits real money income.
November 2009, Ebullio Capital Management hedge fund commodity control the London Metal Exchange (LME) stocks almost 90% of the tin and cash contracts. November 2009, Ebullio Capital Management hedge fund commodity control the London Metal Exchange (LME) stocks almost 90% of the tin and cash contracts.
February 2010, the company's assets under management fell to $ 1,470,000, and in November 2009 compared to 4,230 million U.S. dollars, after the company had liquidated some of the actual book assets, as well as some long-held, mainly for LME non-ferrous metals speculative positions. February 2010, the company's assets under management fell to $ 1,470,000, and in November 2009 compared to 4,230 million US dollars, after the company had liquidated some of the actual book assets, as well as some long-held, mainly for LME non-ferrous metals speculative positions.
"It's like the saying goes, too, as people who do not learn from history is bound to repeat it," said a dealer in Singapore. "It's like the saying goes, too, as people who do not learn from history is bound to repeat it, "said a dealer in Singapore.
"I have learned that is not to bet on in the tin. If you can not tin Shangwang strategist, you are likely to lose the bankrupt." "I have learned that is not to bet on in the tin. If you can not tin Shangwang strategist, you are likely to lose the bankrupt. "
Tin Market prospects for the better ........... To the good prospects of Wuxi City
Index of London Metal Exchange (LME) tin contract hit a record high last Friday, 29,700 dollars per tonne, this year the best performing industrial metal, recorded a 10% increase. Index of London Metal Exchange (LME) tin contract hit a record high last Friday, 29,700 dollars per tonne, this year the best performing industrial metal, recorded a 10% increase.
Reuters said analyst Wang Tao, Elliott Wave theory suggests, the tin price is USD 34,000 per tonne walking in the road. Reuters said analyst Wang Tao, Elliott Wave theory suggests, the tin price is USD 34,000 per tonne walking in the road.
Indonesia last month, tin production has been suppressed in the rain and fight the global tin supply of tin consumption accounts for nearly 30% of the estimated 2010 annual production of 105,000 tons. Indonesia last month, tin production has been suppressed in the rain and fight the global tin supply of tin consumption accounts for nearly 30% of the estimated 2010 annual production of 10.5 million tons.
Meanwhile, the status of the land reserves of refined tin in a sharp drop in the trend, which will force the main tin-producing Bangka-Belitung islands out of the mine are starting on the higher cost of offshore exploration for minerals. Meanwhile, the status of the land reserves of refined tin in a sharp drop in the trend, which will force the main tin-producing Bangka-Belitung islands out of the mine are starting on the higher cost of offshore mineral exploration.
International Tin Research Organization (ITRI) this week estimated the global tin consumption in 2010 was 360,300 tons, up 12.5%. International Tin Research Organization (ITRI) this week estimated the global tin consumption in 2010 was 360,300 tons, up 12.5%.
Tin demand in the coming years is expected to rise, analysts continue to forecast months, Indonesia's tin production due to lack of mining investment will decline. (End) Tin demand in the coming years is expected to rise, analysts continue to forecast months, Indonesia's tin production due to lack of mining investment will decline.
(Compile Lan Xiu-juan;sourced reuters)
ICEX iron ore March 2011 contract prices were up 1.20% to trade at Rs 8,069 per tonne
Indian Commodity Exchange (ICEX) on Saturday launched iron ore futures contract along with Multi Commodity Exchange.
ICEX iron ore March 2011 contract prices were up 1.20% to trade at Rs 8,069 per tonne while April 2011 contracts also traded at Rs 7,628 per tonne. The contract will be on monthly expiry basis with a trading unit of 100 dry metric tonne (DMT). The delivery unit is 5,000 DMT. In the international markets, the spot Australian benchmark iron ore price hit $ 185 per tonne on Friday while Indian iron ore price with 63.5% iron content was quoted at $190 per tonne.
Total volume of all the three contracts March, April and May 2011 was 246 lots (24,600 tonne) valued at Rs 19.50 crore on the first day of trading.
“Based on the run up to launch of Iron ore contract, trade volumes on first day of trade on ICEX were robust with good participation and liquidity seen in its March and April contracts,” Sanjay Chandel, CEO, ICEX, said.
“In coming days we will see more physical market participants using ICEX platform for effective risk management and hedging activities. This is possible due to our contract meeting international standards and transparency in price discovery,” he said.
ICEX iron ore March 2011 contract prices were up 1.20% to trade at Rs 8,069 per tonne while April 2011 contracts also traded at Rs 7,628 per tonne. The contract will be on monthly expiry basis with a trading unit of 100 dry metric tonne (DMT). The delivery unit is 5,000 DMT. In the international markets, the spot Australian benchmark iron ore price hit $ 185 per tonne on Friday while Indian iron ore price with 63.5% iron content was quoted at $190 per tonne.
Total volume of all the three contracts March, April and May 2011 was 246 lots (24,600 tonne) valued at Rs 19.50 crore on the first day of trading.
“Based on the run up to launch of Iron ore contract, trade volumes on first day of trade on ICEX were robust with good participation and liquidity seen in its March and April contracts,” Sanjay Chandel, CEO, ICEX, said.
“In coming days we will see more physical market participants using ICEX platform for effective risk management and hedging activities. This is possible due to our contract meeting international standards and transparency in price discovery,” he said.
Two Japan-led groups to bid for Tavan Tolgoi coal mine
* Mitsui says has submitted proposal to develop coal mine* Tavan Tolgoi seen as one of world's largest coal reserves
* Itochu-led group to submit proposal soon -source
* Mitsui ties up with Shenhua, Peabody -sources
* Itochu group includes Korean, Russian firms -sources
By Yuko Inoue
TOKYO, Jan 31, 2011 (Reuters) - Two groups led by Japanese trading houses will bid to develop Mongolia's Tavan Tolgoi coal mine, regarded as one of the world's biggest untapped reserves, eyeing demand from Japanese steelmakers keen to diversify their sources of coal.
The consortiums, one led by Mitsui & Co (8031.T: Quote) and another by Itochu Corp (8001.T: Quote) are expected to propose large infrastructure projects as part of their bid, including the establishment of railways and power plants, sources familiar with the matter said.
The government of Mongolia will keep ownership of the mine which has an estimated reserve of 6 billion tonnes, but will give strategic investors a chance to develop the western block on a contract basis.
The consortiums, one led by Mitsui & Co (8031.T: Quote) and another by Itochu Corp (8001.T: Quote) are expected to propose large infrastructure projects as part of their bid, including the establishment of railways and power plants, sources familiar with the matter said.
The government of Mongolia will keep ownership of the mine which has an estimated reserve of 6 billion tonnes, but will give strategic investors a chance to develop the western block on a contract basis.
Mitsui & Co (8031.T: Quote), Japan's No. 2 trading house, said on Monday it had submitted a proposal for a tender to develop the mine and buy coal from the project.
"We have submitted a proposal in accordance with the requirement of the tender," a Mitsui spokesman said. He declined to provide further details.
Mitsui was planning to partner with China's state-run Shenhua Group (1088.HK: Quote) (601088.SS: Quote), and Peabody Energy (BTU.N: Quote) of the United States on the bid, two industry sources told Reuters last week.
"We have submitted a proposal in accordance with the requirement of the tender," a Mitsui spokesman said. He declined to provide further details.
Mitsui was planning to partner with China's state-run Shenhua Group (1088.HK: Quote) (601088.SS: Quote), and Peabody Energy (BTU.N: Quote) of the United States on the bid, two industry sources told Reuters last week.
A group led by rival trading house Itochu Corp (8001.T: Quote) will also submit a proposal soon, a source in the consortium with direct knowledge of the matter told Reuters, asking not to be named because the information is not yet public. A spokesman for Itochu said he was checking on the matter.
Itochu has tied up with three Japanese trading houses -- Sumitomo Corp (8053.T: Quote), Marubeni Corp (8002.T: Quote) and Sojitz Corp (2768.T: Quote) -- as well South Korea's state-owned Korean Resources Corp and Russian's state-owned Russian Railways, the two industry sources said.
Itochu has tied up with three Japanese trading houses -- Sumitomo Corp (8053.T: Quote), Marubeni Corp (8002.T: Quote) and Sojitz Corp (2768.T: Quote) -- as well South Korea's state-owned Korean Resources Corp and Russian's state-owned Russian Railways, the two industry sources said.
Japanese trading houses are eyeing the project in part as a way to tap demand from Japanese steelmakers, which rely on Australia for 60 percent of their coking coal needs and are eager to diversify procurement to other regions.
Steelmakers across Asia have been scrambling to secure new supply channels after devastating floods hit Queensland -- the heart of Australia's coal mining sector -- late last year.
Some investors said winning the deal could add lustre to the winner's stock price over the long-term.
"An investment in resource-rich Mongolia has a huge potential," Tomomi Yamashita, a fund manager at Shinkin Asset Management, said.
"It's an attractive theme that the market can play with."
The Itochu group may offer a project worth more than $1 billion, including the construction of a 400 km railway connecting Mongolia and Russia, sources said, as it aims to transport the coal to South Korea and Japan through the east Russian coast.
The Mitsui group plans to ship coal through China to Japan, the Sankei newspaper reported late last year.
The Mongolian government has set Monday as the deadline for bidders to submit initial proposals, and will decide which ones are qualified to proceed before launching the official bidding process.
The proposals must also include offers of an upfront payment to win the deal, said Ch.Baatbayer, a senior official at Erdenes MGL, the government entity that owns the mine.
A top executive at a Japanese trading house, who talked only on condition of anonymity, said global mining giants like BHP Billiton (BHP.AX: Quote) (BLT.L: Quote) which previously expressed interest in the project, have already quit. (Editing by Nathan Layne and Edwina Gibbs)
Steelmakers across Asia have been scrambling to secure new supply channels after devastating floods hit Queensland -- the heart of Australia's coal mining sector -- late last year.
Some investors said winning the deal could add lustre to the winner's stock price over the long-term.
"An investment in resource-rich Mongolia has a huge potential," Tomomi Yamashita, a fund manager at Shinkin Asset Management, said.
"It's an attractive theme that the market can play with."
The Itochu group may offer a project worth more than $1 billion, including the construction of a 400 km railway connecting Mongolia and Russia, sources said, as it aims to transport the coal to South Korea and Japan through the east Russian coast.
The Mitsui group plans to ship coal through China to Japan, the Sankei newspaper reported late last year.
The Mongolian government has set Monday as the deadline for bidders to submit initial proposals, and will decide which ones are qualified to proceed before launching the official bidding process.
The proposals must also include offers of an upfront payment to win the deal, said Ch.Baatbayer, a senior official at Erdenes MGL, the government entity that owns the mine.
A top executive at a Japanese trading house, who talked only on condition of anonymity, said global mining giants like BHP Billiton (BHP.AX: Quote) (BLT.L: Quote) which previously expressed interest in the project, have already quit. (Editing by Nathan Layne and Edwina Gibbs)
India hopes to sort Orissa plant coal issues by mid-Feb
Monday 31 January 2011, 2:15 PMMUMBAI (Reuters) - India's power ministry is hopeful of resolving environmental issues regarding a coal block attached to a proposed 4,000 megawatt power project in Orissa by mid-February, Power Secretary P Uma Shankar told reporters on Monday.
"The government has postponed the date for pre-qualifying for the Orissa project to March 31 from Jan. 31," he said on the sidelines of an industry conference.
The coal-fired power plant will use coal from mines located in an environmentally sensitive forested area.
India currently has four 'ultra-mega power projects' of 4,000 MW each under construction, as part of its effort to boost generation capacity.
(Reporting by Ketan Bondre;Editing by Aradhana Aravindan )
India gives conditional OK for POSCO mill-govt statement
NEW DELHI Jan 31, 2011 (Reuters) -
India's environment ministry gave conditional approval on Monday for South Korean POSCO's (005490.KS: Quote) $12 billion steel mill, a government statement said, in a boost for the foreign investment climate after several setbacks for large-scale industrial projects.
The ministry also conditionally cleared the plant's captive port and power plant. (Reporting by Nigam Prusty; Writing by Alistair Scrutton; sourced:Reuters)
India approves $12 bln POSCO steel mill
Environment ministry approves $12 billion project
* Project is single largest foreign investment in India
* Approval may ease concern about changing regulations
By Nigam Prusty and Paul de Bendern
NEW DELHI, Jan 31 (Reuters) - India's environment ministry approved on Monday South Korean POSCO's plans for a $12 billion steel mill, a boost for the foreign investment climate after several setbacks for big ticket industrial projects.
The long-delayed clearance for India's biggest foreign direct investment -- as long as the company meets a series of environmental standards -- follows a year in which Environment Minister Jairam Ramesh has blocked several projects, raising criticism he was jeapordising India's growth story.
"Undoubtedly projects such as that of POSCO have considerable economic, technological and strategic significance for the country," the statement said. "At the same time, laws on environment and forests must be implemented seriously."
The mill in eastern Orissa state has been delayed by criticism it would ruin lives of thousands of poverty-stricken people, who say the plant will disrupt their betel leaf plantations and forest-based livelihoods.
India, one of the world's fastest growing major economies, needs foreign capital to boost infrastructure and allow its economy to grow at near double digits. But projects have met with protests from local farmers in this densely-populated country.
A government panel had earlier said there were no ecological concerns over the plant and the final decision was with Ramesh.
Posco is among several corporations, including Vedanta Resources, which have come under scrutiny from Ramesh, putting his ministry in conflict with others in the government who are pushing for rapid industrialisation.
A series of corruption scandals has shaken the government of Prime Minister Manmohan Singh and a recent minor cabinet reshuffle saw several ministers' portfolios change, but Ramesh stayed on as environment minister, indicating his influence.
The ruling Congress party head, Sonia Gandhi, is keen to win over farmers hit by big projects at well as ensuring industrial jobs are created -- a fine line that may have helped create regulatory uncertainty before state elections this year and a general election in 2014.
REGULATORY UNCERTAINTY
While investors tend to shrug off corruption scandals as a risk of emerging markets, regulatory uncertainty threatens to taint India's attractiveness as a destination for foreign firms eager for a slice of its booming $1.3 trillion economy.
In October, Ramesh threw out plans by London-listed Vedanta to expand its alumina refinery over worries it would destroy a "sacred" hill for tribal peoples, but this month Ramesh said he was willing to conditionally reconsider Vedanta's expansion plan.
That remark came soon after the ministry said it could consider approving Hindustan Construction Co's ambitious Lavasa project, a massive new town in a forested area near the city of Pune being built at a cost of $31 billion.
A back-and-forth on whether to ban iron ore exports in the Karnataka state has also worried investors. ArcelorMittal, the world's top steel maker, has also had faced years of delays in building several plants in India.
Approval for the Posco mill would see the Orissa government immediately starting to acquire land for the world's third-largest steelmaker's project.
Posco still faces a series of hurdles that could delay the project, such as a court case filed by a local firm against the Orissa government, contesting its decision to grant a mining concession to South Koreans.
India, which has not yet been able to exploit its potential as a natural resources-rich country, is keen on boosting its trade and political ties with South Korea while Seoul looks to tap into the $150 billion Indian nuclear power market.
Direct investors -- companies building factories or power plants or buying local firms -- often have less flexibility and more to lose than fund investors and are especially sensitive to regulatory uncertainty.
Leading global companies such as Wal-Mart Stores, Vodafone and Posco have been frustrated for years in their efforts to negotiate regulations in a promising but perilous market, and foreign direct investment has suffered.
Vodafone, India's biggest foreign direct investor to date, is fighting a 120 billion rupee ($2.6 billion) tax bill in a court battle and has complained about a telecoms regulatory structure that it said allowed too many players into the market. (Additional reporting by Krittivas Mukherjee; writing by Paul de Bendern and Alistair Scrutton; Editing by Alistair Scrutton)
Iranian car production in 2010 up by 16pct YoY
Monday, 31 Jan 2011
MNA reported that production in the two giant Iranian car making companies, Iran Khodro and Saipa Group, reached 1,266,147 units in a ten month period ending January 20th 2011.
The figure shows a 16% raise compared to the same period the year before.
The two companies had an almost equal share in the production.(source:mehrnews.com)
MNA reported that production in the two giant Iranian car making companies, Iran Khodro and Saipa Group, reached 1,266,147 units in a ten month period ending January 20th 2011.
The figure shows a 16% raise compared to the same period the year before.
The two companies had an almost equal share in the production.(source:mehrnews.com)
Punjab government wins rights of Chiniot Rajoa iron ore project
Monday, 31 Jan 2011
A spokesman of Mines & Minerals Department Punjab has said that all rights and privileges of Chiniot Rajoa iron ore project are with the government of Punjab and nothing is entrusted to any one except the consultancy services.
According to handout issued on January 27th 2011, the spokesman further said that Punjab Government has planned development of its iron ore resources in a scientific manner and approved a road map with the objective to establish a steel mill in Punjab.
The spokesman further said that as a first step hydrological and geotechnical studies are being conducted to evaluate the deposits of iron ore. The spokesman said that for this purpose six boreholes in Chiniot and 25 boreholes in Rajoa are planned and as per international standards of quality study, four foreign consulting firms have been pre qualified for the task through advertisement in the press.
The spokesman further said that on the basis of competitive technical financial proposals, one of the firms will be finalized. The work is likely to be awarded in February 2011 and the study time for Chiniot is three months and for Rajoa one year.
The spokesman said that as soon as the extent, quality and quantity of Chiniot Rajoa iron ore deposits are confirmed, Government of Punjab would proceed as per law for private public partnership. The entire process is transparent both for public and private sector investment.
The spokesman clarified that all rights and privileges are with the government and nothing is entrusted to any one except the consultancy services.(sourced:onlinenews.com.pk)
A spokesman of Mines & Minerals Department Punjab has said that all rights and privileges of Chiniot Rajoa iron ore project are with the government of Punjab and nothing is entrusted to any one except the consultancy services.
According to handout issued on January 27th 2011, the spokesman further said that Punjab Government has planned development of its iron ore resources in a scientific manner and approved a road map with the objective to establish a steel mill in Punjab.
The spokesman further said that as a first step hydrological and geotechnical studies are being conducted to evaluate the deposits of iron ore. The spokesman said that for this purpose six boreholes in Chiniot and 25 boreholes in Rajoa are planned and as per international standards of quality study, four foreign consulting firms have been pre qualified for the task through advertisement in the press.
The spokesman further said that on the basis of competitive technical financial proposals, one of the firms will be finalized. The work is likely to be awarded in February 2011 and the study time for Chiniot is three months and for Rajoa one year.
The spokesman said that as soon as the extent, quality and quantity of Chiniot Rajoa iron ore deposits are confirmed, Government of Punjab would proceed as per law for private public partnership. The entire process is transparent both for public and private sector investment.
The spokesman clarified that all rights and privileges are with the government and nothing is entrusted to any one except the consultancy services.(sourced:onlinenews.com.pk)
Sunflag Iron and Steel Company Q3 profit down
Monday, 31 Jan 2011
Sunflag Iron & Steel Company Ltd has announced the Financial Results for the Quarter ended December 31st 2010.
The company has posted net sales / income from operations of INR 375.16 crores for quarter ended December 31st 2010 against INR 359.55 crores for the quarter ended on December 31st 2009.
The Net Profit / (Loss) was at INR 12.99 crores for the quarter ended December 31st 2010 against INR 29.29 crores for the quarter ended on December 31st 2009.(sourced:Equity Bulls)
Sunflag Iron & Steel Company Ltd has announced the Financial Results for the Quarter ended December 31st 2010.
The company has posted net sales / income from operations of INR 375.16 crores for quarter ended December 31st 2010 against INR 359.55 crores for the quarter ended on December 31st 2009.
The Net Profit / (Loss) was at INR 12.99 crores for the quarter ended December 31st 2010 against INR 29.29 crores for the quarter ended on December 31st 2009.(sourced:Equity Bulls)
Turkish steel export value may reach USD 15 billion in 2011 - Report
Monday, 31 Jan 2011
Hurriyet Daily News reported that Turkey's total steel export value is expected to reach USD 15 billion in 2011, up by 20% YoY.
Turkish iron and steel producers are not content with the rise in the country’s production and exports in 2010, as the increase was mainly dependent on price hikes in global markets. The fact that the total volume of production and exports has been falling for the last two years, despite a rise in value in 2010, backs the local producers’ thesis.
Still, professionals have slight hopes for a better year due to the global recovery, rise in demand and the condition's in leading economies being directed toward an inevitable price hike.
Mr Veysel Yayan head of Turkish Iron & Steel Producers Association said that "Turkey's total steel export value increased by 11.5% mainly because of price increases compared to 2009."
He said that Turkey's crude steel production might rise to 33 million tonnes and iron and steel prices could jump as the industry reacts to a surge in raw material costs.
The country's total steel export value is expected to reach USD 15 billion in 2011, up by 20% compared with last year, mainly thanks to an apparent growth in crude steel production capacity, recovery in international markets and increasing product prices triggered by the rising cost of raw materials.
Mr Peter Marsh journalist at Financial Times said that steel prices are set to jump by up to 66% in 2011, top executives and analysts have said, with a burst of inflation that the market has suffered only once in the last 70 years.
Talking about the predictions of foreign experts and analysts, including Mr Michael Shillakeri of Credit Suisse and Mr Eiji Hayashida of JPE of Japan commenting to FT, Mr Yayan said that "It is hard to predict how much iron and steel prices could rise and that the prices were already on an upward trend. Flat steel prices were around USD 450 but last year rose to nearly USD 700."
He said that the hike in iron and steel prices mostly triggered by high demand in the Middle East and a global surge in raw material prices such as for iron ore and coal. He added that "The scrap metal prices were floating around $300 per tons and rose to USD 520 recently."
He said that it is normal to think that such an increase would be reflected in the iron and steel prices in all sectors. Its is likely for steel prices to hit USD 900 per tonne by the end of 2011, like when the market experienced rocketing prices in 2008 flat iron prices reached USD 1,500 per tonne.
Mr İsmail Durak sales and marketing chief for Kardemir said that "The peaking prices for steel could be because of the rising demand for steel sheets used in the automotive industry. As the global markets recover, consumption is on rise and this could reflect on steel and iron prices, as they are the main components of many fields of manufacturing. One of the main reason for the rising price for scrap metal is the harsh weather conditions in the US and Russia."
Mr Ç Kerem Vaizoğlu export manager of Ekinciler Iron & Steel Ind said that "I do not expect a rise by 60% in steel prices in 2011. Prices could rise due to rising demand caused by the automotive industry and construction sector."
Representatives of the world's steel and iron giants met at the first Regional Mining, Metals and Minerals Summit held in Istanbul and agreed on a great number of deals.
The source said that Iranian state officials are seeking opportunities in Turkey, claiming that state officials attending a meeting with a member of the Iranian Industrialist and Businessmen’s Association signed a deal to purchase 170,000 tonnes of rail from Turkish group Kardemir AŞ.
According to the source, Egyptian state officials also placed an order with Kardemir to produce 100,000 tonnes of rail after July 2011. (sourced:hurriyetdailynews.com)
SAIL lines up INR 5000 crore for UP
Monday, 31 Jan 2011
PTI reported that Steel Authority of India Limited will put in over INR 5,000 crore in reviving its unit at Jagdishpur that may include a 1,000 MW gas based power plant to be set up in collaboration with Japan's Kobe Steel.
Besides, it is also examining the prospects of setting up a steel processing unit in Uttar Pradesh, steel minister Mr Beni Prasad Verma while reviewing the progress of the ongoing revival work at maharatna PSU's Jagdishpur unit. Said that “Steel Authority of India Ltd will be examining the feasibility of setting up a steel processing unit at Barabanki/Gonda.”
The first phase of the revival plan with an investment of INR 100 crore in the sick Malavika Steel that was taken over in 2009 by the maharatna PSU is already on, besides some other works, SAIL chairman Mr CS Verma, who accompanied the steel minister.
Talks are already on with Kobe Steels, Japan, for the second phase, which includes a 1000 MW gas based power plant with an investment of INR 2,500 crore and a steel plant based on direct re used iron making technology that would take some three years to complete.Mr Verma added that a joint task force team with the Japanese firm has been set up, which would submit its report in March 2011.(sourced:PTI)
PTI reported that Steel Authority of India Limited will put in over INR 5,000 crore in reviving its unit at Jagdishpur that may include a 1,000 MW gas based power plant to be set up in collaboration with Japan's Kobe Steel.
Besides, it is also examining the prospects of setting up a steel processing unit in Uttar Pradesh, steel minister Mr Beni Prasad Verma while reviewing the progress of the ongoing revival work at maharatna PSU's Jagdishpur unit. Said that “Steel Authority of India Ltd will be examining the feasibility of setting up a steel processing unit at Barabanki/Gonda.”
The first phase of the revival plan with an investment of INR 100 crore in the sick Malavika Steel that was taken over in 2009 by the maharatna PSU is already on, besides some other works, SAIL chairman Mr CS Verma, who accompanied the steel minister.
Talks are already on with Kobe Steels, Japan, for the second phase, which includes a 1000 MW gas based power plant with an investment of INR 2,500 crore and a steel plant based on direct re used iron making technology that would take some three years to complete.Mr Verma added that a joint task force team with the Japanese firm has been set up, which would submit its report in March 2011.(sourced:PTI)
Price hike by Indian steel majors in offing on February opening
Monday, 31 Jan 2011
BL reported that on the backdrop of rise in iron ore and coking coal prices, Indian steel companies are set to hike prices by INR 1,000 to INR 1,500 a tonne in February.
As per report, some of them such as TATA Steel, JSW Steel and Essar Steel have hinted at a possible increase, there has been no reference to the quantum of the hike.
The report cited Mr Vikram Amin director sales & marketing as saying that “If domestic prices are higher, there is always a chance of cheap imports. At present, international prices are higher.”
Mr Jayant Acharya director sales & marketing of JSW Steel said that costs of raw materials have jumped substantially in the last few months and as a result, steel prices have had to move in tandem with input costs.(sourced:BL)
Marcegaglia starts new lines for stainless steel tube in Russia
Monday, 31 Jan 2011
Italian flat steel and steel tube leader Marcegaglia has commissioned two new automatic lines for the production of electro welded stainless steel tubes at its Russia based subsidiary Marcegaglia Ru in the city of Vladimir.
Accordingly, the two new lines, worth a total of EUR 5 million, will produce electro welded stainless steel tubes of 70mm diameter for the chemical, pharmaceutical and food industries.
Over three years, Marcegaglia has invested EUR 22 million in the construction of its plant in Russia with an annual production capacity of 16,000 tonnes, which is planned to be increased to 35,000 tonnes by 2014.
The first two lines at the plant were commissioned in late 2009. The project involves an investment of EUR 50 million, with the total cost of equipment amounting to EUR 20 million.(sourced:steelorbis)
POSCO takes 24pct equity in IMFA arm for USD 5 million
Sunday, 30 Jan 2011
ET reported that South Korean steelmaker POSCO has taken a 24% equity stake in an arm of India's largest ferrochrome maker IMFA.
POSCO has paid USD 5 million for the stake in a specially created vehicle that has ferrochrome operations.
The annual production of the joint venture furnace located within IMFA's Choudwar unit in Orissa, is 35,000 tonnes.
Under the agreement with IMFA, POSCO will purchase the low cost ferrochrome from the new furnace for 25 years.
Mr Subhrakant Panda MD of MFA said that "It's a three stage transaction where we first transferred a new ferrochrome furnace to a subsidiary, with POSCO taking 24% in the subsidiary. Subsequently, the subsidiary leased the furnace back to IMFA."
The listed parent IMFA, on the other hand, owns chrome ore, coal mines and power generation businesses, which would have commanded a steeper valuation. IMFA operates five furnaces with a total capacity of 150,000 tonnes. POSCO annually buys 480,000 tonnes of ferrochrome and has a similar long term supply contract to buy 35,000 tonne of ferrochrome from South Africa.(sourced:economictimes.com)
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