Iron ore shortages lead to 71.4% decline in JSW Steel profits

Sat,Oct22, 2011

Mumbai: Indian steel company, JSW Steel announced its Q2 results today, showcasing decline in net profit by 71.4 per cent at Rs. 127.12 crore as compared to Rs. 445.44 crore in Q2 FY10-11, much more than street expectations. The stock market did not react kindly to the results as the company’s share prices declined to Rs. 569.29 before ending at Rs. 580.45, down by 0.37 per cent.

Net sales rose to Rs. 7,625.06 crore from Rs. 5,712.84 in the corresponding quarter of FY11, reflecting a growth of 33.4 per cent on year on year basis (YoY) and a quarter on quarter (QoQ) growth of 8 per cent. Turnover stood at Rs. 8,242.55 crore.

Iron ore shortage has led to lower EBIDTA margin of 17.4 per cent while EBIDTA for the quarter was Rs. 1,332.95 crore, up by 15% over the corresponding quarter of the previous year.

During the current quarter, the Company achieved production of Crude Steel of 1.738 million tonnes, up 11 per cent and saleable steel of 1.882 million tonnes, up 19 per cent. Production was expected to be scaled down to only 30 per cent of capacity. However, the company reported that it lost 4.5 lakh tonnes of output last quarter on iron ore shortage. It also had to purchase 1.9 million tonnes of iron ore in the Karnataka auction.

While, the increasingly high cost of production by Rs. 1,500 per tonne, put pressure on this quarter results, it expects coking coal and iron ore scrap price to moderate, the company said. It also reported a forex loss of Rs. 512.98 crore due to adverse movement in rupee dollar parity.

The steel giant has cut its forecasts for FY12 volume of production guidance and sales guidance by 14 per cent and 13 per cent respectively.


sourced profit.ndtv

China July iron ore imports up by 7pct from June

Thursday, 11 Aug 2011

Reuters quoted data from the country customs authority showed recently that China imports of iron ore rose 6.8% to 54.55 million tonnes in July with restocking and an increase in seaborne supplies taking the figure to its highest point in four months.

With crude steel output still hovering above 1.9 million tonnes a day, China mills have been keen to replenish their iron ore inventories after letting them dwindle in the last few months but imports remain quite a bit short of their record.

An iron ore trader in Shandong said "Steel mills picked up buying in July, but the gains have been capped as steel mills have been trying to keep their inventories low."

Mr Graeme Train steel analyst with Macquarie in Shanghai said credit restrictions have made it difficult for end users and traders to raise their stocks significantly and the steady increase in the amount of available supplies has been a bigger driver of import growth in July.

He said that "We have seen a gradual improvement in shipments from Australia and Brazil after a pretty poor performance in the first quarter and early second quarter and this is being reflected in the data."

Mr Graeme Train said "The Chinese are always trying to get hold of any material they can and this (July figure) reflects that there is more available."

Global miners have been banking on rising long term demand from China their biggest customer to support their capacity expansion plans.

(Sourced from Reuters)

World crude steel output climbs 8.8% to 117 mmt in Feb

22 March 2011 at 10:45 IST

BRUSSELS (Commodity Online) : World crude steel production for the 64 countries reporting to the World Steel Association was 117 million metric tons (mmt) in February 2011.

This is 8.8% higher than February 2010, according to a press release.

China’s crude steel production for February 2011 was 54.3 mmt, up 9.7% compared to February 2010. Japan produced 8.9 mmt of crude steel in February 2011, an increase of 5.7% compared to the same month last year. South Korea produced 5.0 mmt of crude steel in February 2011, 25.7% more than February 2010.

In the EU, Germany’s crude steel production for February 2011 was 3.7 mmt, an increase of 7.9% compared to February 2010. Italy’s crude steel production was 2.3 mmt, up 4.9% compared to the same month last year. Spain produced 1.4 mmt of crude steel in February 2011, an increase of 6.4% on February 2010.

Turkey’s crude steel production for February 2011 was 2.5 mmt, an increase of 35.5% compared to February 2010.

The US produced 6.6 mmt of crude steel in February 2011, 5.6% higher than February 2010.

Brazilian crude steel production in February 2011 was 2.7 mmt, an increase of 11.4% on February 2010.

The world crude steel capacity utilisation ratio of the 64 countries in February 2011 was 82.0%, a slight increase from the updated figure of 80.9% for January 2011. Compared to February 2010, the utilisation ratio in February 2011 is 2.7 percentage points higher.
(sourced commodityonline)

Guryevsk Metallurgical Works crude steel output rises 67pct YoY

Saturday, 05 Mar 2011

It is reported that Guryevsk Metallurgical Works a subsidiary of Russian steel producer ESTAR Holding, in the January to February period of the current year saw its crude steel output increase by 66.6%YoY producing 32,200 tonnes.

During the period in question, GMZ increased its commercial rolled steel product output by 15.6% to 39,600 tonnes and upped its steel grinding balls production by 17.5%YoY to 17,000 tonnes.
(sourced:steelorbis)

HBIS is second steelmaker in the world

Tuesday, 01 Mar 2011

It is reported that HBIS stood top one among national steelmakers with crude steel capacity of 44.78 million tonnes in 2010, second only to ArcelorMittal in the world.

Mr Wang Yifang president of HBIS said the secret of success was M&A. Currently, small scale of steelmakers, scattered industrial distribution and overlapping construction are serious problems for Chinese steel industry under severe control of raw material suppliers like Rio Tinto, BHP Billiton and Vale.

HBIS was a super large steel group, jointly setting up by original Taishan Steel Group and Handan Steel Group since June 30th 2008. Steel capacity of HBIS added from 31.08 million tonnes in 2007 to 44.78 million tonnes in 2010 with total assets increasing from CNY 148 billion to CNY 282.8 billion listing top 500 global enterprises for consecutive two years achieving No 314 in 2010 from No 375 in 2009.

On the basis of internal integration, HBIS took holdings of Shijiazhuagn Steel, restructuring HBXG machinery and other 12 private steel mills via progressive integration of equity. Mr Zhang Changfu vice president of CISA pointed out that integration and restructuring of HBIS left a significant demonstration effect for Chinese steel industry to implement further restructuring program. (sourced from mysteel)

Dazhou Steel to produce 3 million tonnes of finished steel in 2011

Monday, 21 Feb 2011

It is reported that Sichuan Province based Chinese steel producer Dazhou Iron and Steel in 2011 aims to produce 3.1 million tonnes of finished steel and achieve sales revenues of CNY 21.5 billion.

In January this year, Dazhou Steel produced 274,519 tonnes of crude steel up by 87.58%. The steel maker's finished steel output in January amounted to 314,100 tonnes while its sales revenues for the month came to CNY 1.29 billion

Dazhou Steel also stated that in 2010 it upgraded its production facilities, with its converter No 2 and converter No 3 both of 120 tonnes capacity starting production in April and October respectively. As a result, Dazhou Steel can now produce 3.0 million tonnes to 3.5 million tonnes of crude steel per year.

(Sourced from www.steelorbis.com)

Wuyang Iron and Steel posts net profit of RMB 123 million in 2010

Monday, 21 February 2011

Chinese steelmaker Wuyang Iron and Steel has posted a net profit of RMB 123 million ($18.7 million) for the whole year of 2010, with a total pre-tax profit of RMB 379 million ($57.5 million). The company also realized a sales income of RMB 11.5 billion ($1.7 billion) in the year in question, while it recorded a total crude steel output of 2.51 million mt and produced 2.21 million mt of steel plates.

In 2011, Wuyang Iron and Steel aims to achieve crude steel production of 2.8 million mt and a steel plate output of 2.4 million mt. For the same year, Wuyang Iron and Steel is targeting a net profit of RMB 120 million ($18.2 million) and sales income of RMB 12 billion ($1.8 billion).


(sourced:steelorbis)
Tags: plate , crude steel , flats , China , Far East , East Asia and Pacific , steelmaking , production , fin. Reports , Hot Rolled Plate

January Brazil Steel Output Up 3.8% To 2.8 Million Tons From Year Ago -IABr

Friday,18 February 2011 08:17pm

RIO DE JANEIRO -(Dow Jones)- Brazilian steelmakers produced 2.8 million metric tons of crude steel in January, 3.8% higher than in the same month of 2010, the Brazilian Steel Institute, or IABr, said in a statement Friday. January's output was 16.2% higher than in December, IABr said.

Rolled products steel output rose 0.4% from a year ago to 2.1 million tons. This was 15.4% higher than in December, when some Brazilian steel mills reduced output due to coal supply difficulties and high steel import levels.

Domestic steel product sales rose to 1.7 million tons in January, up 4.5% from the same 2010 period and 11.4% over December levels, IABr said.

Steel products imports fell to 343,600 tons in January, 10.6% lower than in January 2010, as international steel prices rose, boosting the cost of imported products.

Export volumes meanwhile grew to 1.1 million tons, 60% higher than a year ago, IABr said.
(sourced:Dow Jones)

Shanxi’s raw coal output up 9.4 pct in Jan 2011

Saturday,Feb19,2011

Coal produced by coal-rich Shanxi province of North China witnessed a year-on-year increase of 9.4 percent in raw coal output to 57.08 million tonnes in Jan, Shanxi News reported, citing local authorities.

During the month, Shanxi produced 6.56 million tonnes coke, growing 3.5 percent on year, showed data issued by the provincial bureau of statistics on Feb 17.

And, the province produced a total of 2.82 million tonnes pig iron and 2.51 million tonnes crude steel, growing 6.1 percent and 4.6 percent respectively from same period last year, data showed.

Shanxi generated 19.5 billion kWh electricity in Jan, growing 2.7 percent on year, it added.
(sourced:en.sxcoal)

Alchevsk plans to boost steel output by 18pct MoM in Feb

Monday, 14 Feb 2011

It is reported that Alchevsk Steel is planning to increase February crude steel output by 14% to 18% to reach 320,000 tonnes to 330,000 tonnes.

The corresponding increase in rolled products’ output is to underlie 230,000 slab exports in February.

To meet the growing production targets for pig iron, in January the company has re launched Blast furnace No 3 which had been idle due to raw materials shortages.

According to Millennium Capital analyst “The news is POSITIVE for Alchevsk Steelworks, as it implements successfully its plans to increase output. As we expected, this speedy production recovery allows ALMK to capitalize on surging global prices for steel. Importantly, the company has successfully increased iron ore purchases from Metinvest, in order to secure the production hike.”

(sourced:Millennium Capital)

Russia's MMK sees new mill capacity at 1.5 mln T/yr

Wed Feb 9, 2011 11:19am GMT
MOSCOW Feb 9 (Reuters) - Magnitogorsk Iron & Steel Works (MAGN.MM: Quote), Russia's third-largest steelmaker, said on Wednesday its 5,000 mm plate mill has a full order book and that its annual output is about 1.5 million tonnes.
The mill, commissioned in 2009, produced 127,000 tonnes of steel in January, up from 112,000 tonnes in December.

The new mill produces thick steel for industries such as pipe-making and shipbuilding and is part of the company's strategy to increase its value-added production.
The steelmaker, also known as MMK, is in the midst of an aggressive expansion that will see output reach 18.6 million tonnes annually by 2014.
It produced 11.4 million tonnes of crude steel last year and expects 2011 output to increase by 14 percent. (Reporting by Alfred Kueppers, sourced:reuters)

Ukraine maintains December steel production level in January

Wednesday, 09 Feb 2011
It is reported that in January 2011, Ukrainian steelmakers have decreased crude steel output by 1% MoM. Alchevsk Steelworks has boosted the production of crude steel and rolled products by 12% and 15% respectively, while the other producers have shown few changes.
According to Millennium Capital analyst “The news is NEUTRAL for the steel producers. The Ukrainian steel industry has had little change in output comparing to the previous month, apart from Alchevsk Steelworks. We have anticipated the latter’s output to grow, as the parent company has attracted USD 500 million loans in December, managing to stabilize raw material supplies, the cause of the company’s underperformance in 2010.”
Tags: Ukrainian steelmakers, decreased, crude steel output, Millennium Capital, raw materials
(sourced:Millennium Capital)

Metinvest targets annual steel output of 25 million mt in long term

Tuesday, 08 February 2011
Ukraine's largest mining and steel group Metinvest has increased its investments for 2011 by 2.4 times year on year to $1.18 billion in order to improve its steel production efficiency and to strengthen its vertical integration with the aim of processing in-house as much available raw materials as possible into steel, said Metinvest's CEO Igor Syry. He added that during the next five years Metinvest plans to invest around $6 billion for the stated purpose, targeting a long-term output goal of 25 million mt of steel per year, which will take it to around fifth place among the world's major steelmakers.
Metinvest plans to expand its steelmaking capacities both by mergers and acquisitions, and by pursuing organic growth. "We will also strengthen our footprint in our strategic markets - in Ukraine and the CIS, the EU, the Middle East and North Africa. Our presence will grow by means of product portfolio diversification, reduction of the share of semi-finished products down to 10 percent in favor of such products as hot and cold rolled coils, coated coils and heavy sections, as well as through clear customer segmentation and development of long-term mutually beneficial relationships with key accounts," Mr. Syry said.
As regards its technological strategy, Metinvest plans to introduce pulverized coal injection (PCI) technology. Its high-grade coking coal needs per annum will increase to 13 million mt, and its coke needs will rise to 8 million mt. "The share of high-quality coking coal in our blast furnace charge will need to increase, though, unfortunately, there is a lack of such coals in Ukraine. Additional volumes can be imported, and naturally, we will be sourcing them from United Coal (UCC), our own coal mining company in the USA. We have approved capacity expansion projects at the Affinity and Roaring Creek mines, and we are planning to increase supplies," Mr. Syry stated.
In addition, Metinvest plans the implementation of energy efficiency projects, the positive effect of which, according to preliminary estimations, will amount to around $1 billion per year.
Tags: hrc , crude steel , coking coal , crc , raw mat , semis , flats , Ukraine , CIS , steelmaking , production , investments , Metinvest(sourced:steel orbis)

Japan steel mills see output 28.4 mln T in Jan-Mar

Wed Feb 2, 2011 1:53am EST
* Plan for 2.6 pct bigger output than Oct-Dec
* Exceeds METI estimate by 5.6 pct
* Plans may not fully reflect impact of floods -METI

TOKYO, Feb 2 (Reuters) - Japanese steelmakers' buoyant production may continue into the current quarter on strong demand from Asia, despite supply disruptions of coal from Australia that have forced them to rely on the costlier spot market.
A government poll of about 60 big Japanese steelmakers released on Wednesday showed the companies plan to produce 28.40 million tonnes of crude steel in January-March, up 2.6 percent from the previous quarter.
The figure is 5.6 percent above an estimate by the Ministry of Economy, Trade and Industry revealed last month of 26.88 million tonnes.
A ministry official said the survey on output plans was conducted before the magnitude of the impact of the devastating floods in Australia became clear, and revisions of the plan were possible.

Japanese steelmakers, which rely on Australia for 60 percent of their coking coal needs, have said they have secured enough coal stocks to run until the end of March unless there are further floods or damage to infrastructure in the country.

Japanese companies are boosting coking coal purchases from alternative sources such as the United States, Canada, China and Indonesia, relying on the spot market in some cases.
Nippon Steel Corp (5401.T) and JFE Holdings Inc (5411.T) kept their 2010/11 production plans unchanged when they announced steep downward revisions in their earnings outlooks last week. (Reporting by Yuko Inoue; Editing by Michael Watson)

China 2010 steel output underreported - Macquarie

Thursday, 03 Feb 2011
According to Macquarie Research, Chinese crude steel output may have been under reported by 13 million tonnes in 2010 by failing to include small steel mills especially in the country's steel heartland of Hebei province.
Macquarie said annual production capacity of 24 million tonnes in the third quarter of last year and 27 million tonnes in the fourth quarter was excluded from full year steel production figures which should have reached 640 million tonnes.
Data from the National Bureau of Statistics showed China produced a record 627 million tonnes of steel last year.

Mr Luo Bingsheng, deputy chairman of the China Iron & Steel Association warned in late October that regional governments and enterprises could be misreporting their output figures.
Macquarie said CISA representing 77 medium and large sized Chinese steel mills said its Hebei based members produced 10.4 million tonnes of crude steel in December but the NBS put the figure at 9.2 million tonnes for the whole province.
Macquarie said "China demand for iron ore is almost 20 million tonnes higher in 2010 than what was implied using the NBS data, adding that this partly contributed to strong iron ore prices over the final quarter of last year.”

Based on its revised figures, Macquarie forecast a modest eight per cent growth in steel production this year, supported by demand from the manufacturing sector, bringing output to 690 million tonnes.(sourced:businessspectator.com.au)

Japan steel makers plan 28.4 mln T output in Jan-Mar

Wed Feb 2, 2011 5:40am GMT

TOKYO Feb 2 (Reuters) - Japanese steelmakers plan to produce 28.40 million tonnes of crude steel in the January-March quarter, up from an estimated 27.67 million tonnes in the previous quarter, according to a survey of big Japanese steelmakers by the country's trade ministry.
That is above the ministry's own estimate revealed in December of 26.88 million tonnes. (sourced:reuters, reporting by Yuko Inoue)

Hyundai Steel to build a new furnace by 2013

Sunday, 30 Jan 2011
Reuters reported that South Korea's Hyundai Steel Co will invest more than KRW 3 trillion to build a No 3 furnace with a capacity of 4 million tonnes of steel per year.
Construction will start in the second quarter of 2011 and run through to 2013.

Hyundai Steel completed its first blast furnace in 2010 with an annual production capacity of 4 million tonnes per annum and added a No 2 furnace with the same capacity later in the year.
In April 2010, the steelmaker said its new furnace would specialize in steel plates for Hyundai Motor Group automobiles to strengthen the group's integrated supply chain.

Hyundai Steel provides crude steel and hot rolled plates to Hyundai Hysco Co Limited, which supplies cold rolled plates to the country's top two automakers Hyundai Motor Co and Kia Motors Corporation.
Hyundai Steel used to make mainly rebar and H section for the construction sector and recycling scrap steel at mini mills. (Sourced: reuters.com)

China to renew bid to curb steel industry sprawl

Saturday, 29 Jan 2011
According to the Ministry of Industry and Information Technology said China will renew its push to reduce the production capacity of its sprawling steel industry as its largest mills continued last year to make only limited progress in the industry consolidation.The country produced 626.7 million tonnes of crude steel last year an all time high that refocused attention on limited effectiveness of policy tightening and government's attempts over the years to curb the industry size.

Mr Zhu Hongren Ministry of Industry and Information Technology spokesman said the 10 largest steel mills raised their combined contribution to the country's total steel output to 48% last year from 45% in 2009, and a total of 179 million tonnes of obsolete steel and iron capacity was shut down.He said that "We should keep tight control of expansion in the highly energy consuming and polluting industry."The ministry data shows that the top 10 steel mills' crude steel output increased slightly in volume terms last year. At 45% of 2009 output, the top 10 mills would have produced 259.6 million tons of crude steel. At 48% of 2010 output, their production would have been 300.8 million tonnes.

In addressing the reach of the government's policy, Mr Zhu sought to make a distinction between permitted and illicit output-capacity additions. He said that "In referring to overcapacity, we are not talking about mere 'expansion of capacity,' but blind expansion."He added that China's steel output capacity has reached 700 million tons. He also said the cement industry, beset by similar issues, also saw output rise last year by 15.5% to 1.8 billion tonnes.(Sourced from online.wsj.com)

Top 10 steelmakers in China 2010

Thursday, 27 Jan 2011
According to research company UC361.com citing the China Iron and Steel Association that the following table ranks China top 10 steelmakers by 2010 production.UC361.com said China 10 biggest steelmakers produced a combined 304.7 million tonnes of crude steel last year making up 49% of the nation total.

That compares with 45% in 2009.Angang New Co was formed in July after Anshan Iron & Steel Group won government approval to take over rival Pangang Group Co. Angang output figure also includes production by Benxi Iron & Steel Group.Tianjin Bohai Iron & Steel Group was also established in July from a combination of four state owned producers in the northern city of Tianjin.

Rank	Company	2010	2009
1	Hebei Iron & Steel Group	52.86	49.69
2	Baosteel Group Corp	44.5	38.87
3	Angang New Co	40.28	37.36
4	Wuhan Iron & Steel Group	36.55	30.34
5	Jiangsu Shagang Group	30.12	26.39
6	Shougang Corp	25.84	19.48
7	Shandong Iron & Steel Group	23.15	21.31
8	Hebei New Wuan Iron & Steel Group	18.59	16.71
9	Tianjin Bohai Iron & Steel Group	17.44	15.95
10	Magang (Group) Holding Co	15.4	14.83

In million tonnes (Sourced from Bloomberg)

Chinese steel industry facing raw materials tightrope walk

Monday, 24 Jan 2011

It is reported that the rising output against profit decrease last year reflected China steel industry is placed in difficult circumstance.
According to the statistics from National Bureau of Statistics of China yesterday, China’s annual crude steel output closed to a record high of 627 million tonnes in 2010 up by 9.3%YoY. However, profit margin of steel industry stood the lowest among the domestic industries.
Mr Xu Xiangchun Chief Info Inspector of Mysteel told the reporter that “Crude steel output decrease since second half of last year reflected that the over supply situation on China steel industry has been improved due to substantial increase of producing cost and energy saving efforts.”
He said “Nevertheless, along with the further possible sharp rise of iron ore, coking coal and other raw materials prices, coupled with steel output rebound after the energy saving storm, steel industry will meet a more difficult operation circumstances in 2011.”
(Sourced from MySteel.net)Visit www.Mysteel.net for real time access to China steel news!