Two steel titans to form in Shanxi in 12th Five Year

Wednesday, 02 Mar 2011 | Xinhuanet

It is reported that Shanxi steel industrial consolidation plan is going to be issued in the coming few days.

As per report, a large scaled drive for enterprise merger and acquisition will be carried out and by 2015 and there will be two steel titans in local to be formed, Taiyuan Iron and Steel Group and Shougang Changzhi Iron and Steel Group.

At present, five steel bases have been established in Shanxi, namely Taiyuan, Southeast Shanxi area, Yuncheng, Linfen and Lvliang. TISCO and Shougang Changzhi will take the major role in this regrouping campaign, with the former chiefly responsible for consolidation of steel mills in Taiyuan, Linfen, Yuncheng and Lvliang and the latter for those in Southeast Shanxi area.

According to the slated schedule, TISCO will complete the regrouping in Taiyuan and Linfen areas by 2013 and that in Yuncheng and Lvliang by 2015. Shougang Changzhi will finish its consolidation target in Changzhi by 2013 and of Fusheng Steel by 2015.

By 2015, as per the plan TISCO will expand its production capacity to 40 million tonnes and thus lift its proportion of contribution to 80% in Shanxi Province. Its annual business income will reach over CNY 200 billion and it will be listed in the first eights of China’s steel enterprises for its comprehensive strength and become a world-class competitive large steel Group. Shougang Changzhi will develop into a group capable of producing 10mln tonnes a year and raise its contribution to 20% in Shanxi Province.

ShaGang to lift EXW price for the first ten days of Mar

Wednesday, 02 Mar 2011

It is reported that leading China steelmaker Benxi Steel unveiled its price change details for Mar 2011 deliveries and most carbon steel prices keep unchanged with the same as that of the last ten days in February

1. Rebar
Mar prices keep unchanged from February level
HRB335 with diameter 16mm to 25mm is offered at CNY 5,150 per tonne
HRB335 with diameter 10mm is offered at CNY 5,250 per tonne
HRB335 with diameter 12mm is priced at CNY 5,210 per tonne
HRB335 with diameter 14mm is priced at CNY 5,170 per tonne
HRB335 with diameter 28mm to 32mm is posted at CNY 5,250 per tonne
HRB400 with diameter 16mm to 25mm is posted at RMB 5,270/tonne;

2. High speed wire rod
Mar prices keep unchanged from February level
Q235 high speed wire rod with diameter 6.5mm is priced at CNY 5,150 per tonne

3. Spiral steel
Mar prices keep flat from February level
HRB400 spiral steel with diameter 8mm is posted at CNY 5,350 per tonne

4. Round bar steel
March prices remain flat from Feb level
Q235 round bar steel with diameter 16mm to 25mm is posted at CNY 5,200 per tonne

5. Hard wire rod
March prices remain flat from February level
45#hard wire rod with diameter 6.5mm is priced at CNY 5,300 per tonne
30MnSi with diameter 6.5mm is priced at CNY 5,400 per tonne
82B with diameter 6.5mm is offered at CNY 5,330 per tonne

6. HRC
March prices remain flat from February level
HRC Q235 with diameter 5.5*1500mm*C is offered at CNY 5000 per tonne
SPHC Q235 with diameter 5.5*1500mm*C is priced at CNY 5080tonne

7. Medium plate
Mar prices up CNY 200 per tonne from February level
Medium plate Q235 with diameter 14mm to 20mm is offered at CNY 5400 per tonne

All price changes listed below are INCLUSIVE of 17% VAT except stated otherwise, and will come into force as of the date of issuance. (sourced mysteel.net)

Tags :China's HRC prices, medium plate prices, Chinese steel mills, Spiral steel prices, round bar steel

Tata Steel's Riversdale stake hike spells trouble for Rio bid

Wed Mar 2, 2011 6:23am GMT

* Tata Steel hikes stake to 27.1 pct from 24.2 pct
* Tata, CSN now own 47 percent of Riversdale
* Rio Tinto offer conditional on winning 50.1 pct acceptance
* Riversdale shares drop 6.5% to A$14.48 v A$16/share offer
(Adds analyst, trader comments, updates shares)

By Sonali Paul

MELBOURNE, March 2 (Reuters) - India's Tata Steel has raised its stake in Australia's Riversdale Mining , making it harder for miner Rio Tinto to seal its $3.9 billion bid for the Mozambique-focused coal miner.

Riversdale shares fell as much as 6.5 percent to a three-month low of A$14.48 on Wednesday, valuing the group 10 percent below Rio's offer, indicating growing doubts about the deal going ahead.

"The share price is telling you that the market thinks that it's going to end in a stalemate, the deal will fall over and Rio will walk," said CLSA analyst Hayden Bairstow.

Tata Steel, already Riversdale's biggest shareholder, spent more than A$100 million ($101 million) upping its stake in Riversdale to 27.1 percent from 24.2 percent, according to a shareholder notice, confirming what sources had told Reuters.

Riversdale's second-largest shareholder, top Brazilian steelmaker CSN , also recently increased its stake in the Australia-listed company to 19.9 percent.

Tata Steel, the world's No. 7 steelmaker, and CSN now own 47 percent of Riversdale, making it extremely difficult for Rio to secure the 50.1 percent acceptances it wants before going ahead with the deal.

Rio now needs almost 100 percent acceptances from minority shareholders and has so far won over just 17 percent of the company.

"Rio seems to be in extreme difficulty," said Gregory Lafitte, Asia merger arbitrage trader at LCM in Hong Kong.

"It's possible to see Rio Tinto reduce the 50 percent acceptance condition or reach a strategic agreement with Tata and CSN," he said.

Rio Tinto declined to comment on the status of its talks with Riversdale's shareholders.

SECURING COAL SUPPLIES

Rio last month extended the offer deadline to March 18 after Tata Steel said it had yet to decide whether to hold or sell its stake.

Tata Steel Managing Director Hemant Nerurkar told Reuters last month the company was mainly interested in securing coking coal from Riversdale for its steel mills and was talking to Rio about a range of options.

Tata already has a stake in Riversdale's Benga coking coal project in Mozambique with an agreement to buy supply from the mine.

CSN said when it bought into Riversdale it wanted to secure coking coal supplies, but it has not said anything about its intentions since Rio Tinto launched its bid.

Under Australian rules, Tata and CSN can continue to increase their stakes in Riversdale by 3 percent every six months without being forced to make a full takeover offer.

The two companies would probably like to see Rio Tinto, with deeper pockets and more technological skills than Riversdale, developing Riversdale's Mozambique mines and infrastructure, analysts said.

At the same time the steelmakers might want the coal mine to remain out of Rio's hands, because they do not want coking coal supplies to come under as tight a control as iron ore, where supplies are largely controlled by three miners, including Rio.

Riversdale's shares closed down 3.4 percent at A$14.97. ($1 = 0.986 Australian Dollars) (Additional reporting by Silvia Antonioli in LONDON and Prashant Mehra in MUMBAI; Editing by Muralikumar Anantharaman, sourced:Thomson Reuters)

Tags:deal, biggest shareholder, Brazilian steelmakers, CSN, stake, mergers and acquisitions,

Chinese daily crude steel output rallies by 6pct in the first 20 days of Feb - CISA

Wednesday,02 Mar 2011

1. China daily production of crude steel rallied about 6% in the first twenty days of February versus January.

2. The inventory of major steel mills increased to 9.46 million tonnes from 7.57 million tonnes posted in January end.

China Iron and Steel Association release in its latest ten day report that both crude steel output and steel inventory in the first and middle ten days of February eyed apparent rises.

Analyst said that the production rally is expectable and mainly due to the bettering industrial profitability.

The report shows that China daily crude steel output averaged about 1.81 million tonnes in the middle ten days of February far higher than January record of 1.7 million tonnes and about 1.8 million tonnes for the first twenty days of February also eyeing a big growth of close to 6% from January.

What worth attention is that the steel products inventory of major steel mills goes up to 9.46 million tonnes a sharp jump from 7.57 million tonnes in January ends. In the middle ten days of February the crude steel output by CISA members posted at 15.95 million tonnes and that for the whole Chinese steel industry is assessed at 18.14 million tonnes.

Mr Deng Qiling President of CISA earlier said that in light of the domestic and overseas demand, China apparent consumption of crude steel in 2011 is expected to grow by 5% to 632 million tonnes which means an increase of 30 million tonnes from last year.

Tags: Chinese domestic steel demand, February month output, CISA members
(sourced:mysteel)