February 6, 2012: The Bhilai Steel Plant (BSP) of SAIL has recorded 3.53 million tons (mt) of saleable steel production during April-January period of FY12, a company statement said on February 3. Of the total production, 2.24 mt was special steel produced during the same period. This in turn included 338,000 tons of merchant products, 462,000 tons of wire rods, 436,000 tons of plates, 594,000 tons of UTS 90 rails and 413,000 tons of special steel semis for home sales. The plant exported 180,000 tons of steel including 147,000 tons of plates to different countries during the period, the statement said. BSP has maintained its thrust of production of value-added grades of steel this year and posted record production of 153,100 tons of Electrode Quality (EQ) wire rods, 77,800 tons boiler quality (BQ) plates, and 110,400 tons of Long Rails. Export rail loading has also been the best ever for the period at 9,900 tons. While the proportion of total special steel in total saleable steel production for the period remained on the higher side at 63.7%, the proportion of special steel grades in total production of individual mills continued to be high. Of the Wire Rod Mill's total production of 474,000 tons of wire rods, the special steel component including EQ wire rods, TMT rods and SWR-10/SAE grades has been 462,000 tons. Out of the plate mill's total production of 980,000 tons in April to January period, the special steel component has been 436,000 tons. This includes boiler quality and high tensile plates, copper bearing plates, normalised plates, ship building plates including export grades, plates of thickness above 40 mm that pass through non destructive tests and other micro-alloyed plates that pass through impact toughness tests. Meanwhile, the plant has achieved a 6.3% growth in iron ore production from the Dalli mines in April to January period as against corresponding period in last fiscal year. Average Convertor lining life at 10,398 Heats and Heats through Ladle Furnace at 11,757 Heats were also the best ever for any April to December period since inception as compared to previous best figures of average Convertor lining life of 9,499 heats and 11,689 heats through Ladle Furnace, both recorded for same period in 2010-11. Source: ISMW

February 6, 2012: The Bhilai Steel Plant (BSP) of SAIL has recorded 3.53 million tons (mt) of saleable steel production during April-January period of FY12, a company statement said on February 3. Of the total production, 2.24 mt was special steel produced during the same period. This in turn included 338,000 tons of merchant products, 462,000 tons of wire rods, 436,000 tons of plates, 594,000 tons of UTS 90 rails and 413,000 tons of special steel semis for home sales. The plant exported 180,000 tons of steel including 147,000 tons of plates to different countries during the period, the statement said. BSP has maintained its thrust of production of value-added grades of steel this year and posted record production of 153,100 tons of Electrode Quality (EQ) wire rods, 77,800 tons boiler quality (BQ) plates, and 110,400 tons of Long Rails. Export rail loading has also been the best ever for the period at 9,900 tons. While the proportion of total special steel in total saleable steel production for the period remained on the higher side at 63.7%, the proportion of special steel grades in total production of individual mills continued to be high. Of the Wire Rod Mill's total production of 474,000 tons of wire rods, the special steel component including EQ wire rods, TMT rods and SWR-10/SAE grades has been 462,000 tons. Out of the plate mill's total production of 980,000 tons in April to January period, the special steel component has been 436,000 tons. This includes boiler quality and high tensile plates, copper bearing plates, normalised plates, ship building plates including export grades, plates of thickness above 40 mm that pass through non destructive tests and other micro-alloyed plates that pass through impact toughness tests. Meanwhile, the plant has achieved a 6.3% growth in iron ore production from the Dalli mines in April to January period as against corresponding period in last fiscal year. Average Convertor lining life at 10,398 Heats and Heats through Ladle Furnace at 11,757 Heats were also the best ever for any April to December period since inception as compared to previous best figures of average Convertor lining life of 9,499 heats and 11,689 heats through Ladle Furnace, both recorded for same period in 2010-11. Source: ISMW

February 6, 2012: Bhushan Steel has put its proposed Rs 20,000 crore steel plant in West Bengal on hold, stonewalled by the Mamata Banerjee government's policy of not acquiring land for industry, a senior company official said. "Land acquisition in the state is an uphill task for the industries, we can not do it alone. It is difficult for us to acquire such a vast area on our own," company Director (Finance) Nittin Johari said. He added, "It (the project) is on hold, nothing is moving there. We can not make any commitment on capital expenditure until the land is acquired fully." Bhushan Steel had proposed to set up a 6 million tons per annum (mtpa) steel plant in the Asansol industrial area, for which it required about 2,500 acres of land. It was envisaged to to have 3-MTPA capacity in the first phase and was to be operational by 2015. However, the company's plans were affected by the state government's decision to not acquire land for industry when the Mamata Banerjee-led government assumed office in May, 2011. The West Bengal Chief Minister has been known for her stance against forcible land acquisition and the decision was taken in that backdrop. "We have not yet to decided to scrap the project as of now. We are still trying to acquire land in small patches, but entire acquisition will take time. Let's see what happens," Johari said, adding that any further decision would take about 6-7 months' time. By October, the company also expects to get a clear signal from Sumitomo Metals, as by then the process of merger of the Japanese firm with Nippon Steel is expected to be completed. Both Bhushan and Sumitomo were earlier exploring the possibility of a joint venture for the proposed steel plant. Bhushan currently has a production capacity of 2.5 MTPA and it produces secondary steel products like cold-rolled coils, galvanised coils, colour-coated coils, etc, from its three manufacturing facilities in Uttar Pradesh, Maharashtra and Odisha. Source: The Economic Times

February 6, 2012: The Visakhapatnam Port has signed a concession agreement with a special purpose vehicle (SPV) to develop the East Quay-1A berth at its inner harbour. The SPV - SEW Vizag Coal Terminal Private Limited - is jointly promoted by Hyderabad-based SEW infrastructure and Malaysia-based PRSB. Based on the agreement, the EQ-1A berth will be developed by the private investors on a design, build, finance, operate and transfer (DBFOT) basis. The cost of the project will be about Rs 313 crore, with the berth lease period being 30 years. The new berth will have fully-mechanised handling facilities. It will have an annual handling capacity of 7.36 million tonne of thermal coal and steam coal, the port said in a press release. With this new agreement, the port has so far awarded five projects under public-private-partnership (PPP). Source: Business Standard

February 6, 2012: A committee set up by the Supreme Court tasked with investigating illegal mining in Karnataka has submitted its final report containing recommendations that could radically change how mining is done in the country and jeopardise planned investments in steel plants in the southern state. The Central Empowered Committee, in its report submitted on Saturday, has recommended the cancellation of leases of 49 mines that have violated the terms of their licence. It is also believed to have recommended the auction of these leases, according to people familiar with its contents. These mines produce up to 10 million tonnes of iron ore per year. The people familiar with the report say 45 mines cleared of any wrong doing will be allowed to mine as soon as the ban is lifted while 72 other mines will resume only after they have paid penalties. The collected fines could be used to establish a Sustainable Mining Development Fund and setting up dedicated mining infrastructure for the area. A moratorium on future leases, until the state has recovered forest lost to illegal mining and established dedicated mining infrastructure, is also on the cards. The CEC is also believed to have agreed with a report by the Council for Forest Research and Education that had recommended capping iron ore production in Karnataka's at 30 million tonnes. The report, commissioned by the apex court, had said this was the state's so-called carrying capacity, meaning that production beyond 30 million would cause irreparable damage to the environment. However accepting this figure, which meets current requirements, would cause leave little room to accommodate planned investments of players such as ArcelorMittal and Posco. Two years ago Karnataka signed a long list of MoU's with NMDC, Bhushan, Tata Metaliks, Adhunik and Kirloskar for setting up steel plants. These MoUs largely committed the state to providing captive iron ore mines to meet a part of the requirement of these proposed plants. Source: The Economic Times

February 6, 2012: The Cochin Port Trust (CPT) will introduce an automated bagging system of cargoes from the fourth week of this month. CPT chairman Paul Antony said on Sunday that 2400 tonne of cargo could be bagged on a daily basis through the new arrangement. This is in view of the severe shortage of workers experienced in certain areas of cargo-handling at the port. This would speed up evacuation of bulk cargo such as fertilisers from the port through the railway network, he said. A high-level meeting held at the port decided that the Kerala Heaload Workers Welfare Board (KHWWB) should review the present pool system of headload workers and rearrange all the existing members of the scheme in the port area as per the requirement of the stakeholders. As a measure of curbing notional wages (nokku kooli), the CPT officials would countersign the indent placed by the port users on the KHWWB so that port users would not be under pressure to indent for more than the required number of labourers. The KHWWB will make all efforts to supply labourers strictly as per the indent. It will proceed action against those workers who were continuously absent after giving the statutory notice. The high-level meeting was attended by the divisional railway manager, state labour commissioner, additional secretary (transport), commissioner of police, Kochi, RDO, Fort Kochi, senior officers of the concerned departments and various stakeholders of the port. The railways spelt out various new plans to increase the rail movement connecting the port. The port users highlighted that a major pre-condition for diverting the port cargo through the railways would be to ensure appropriate labour practices and competitive rates for loading and unloading of cargo in the port area. Source: Business Standard

February 6, 2012: India's largest iron ore miner NMDC Limited, which is expanding its geographical footprint, is currently in the process of acquiring two coking coal projects in Russia and Australia, besides an iron ore mine in Brazil involving an initial investment of over $500 million. According to NMDC in-charge chairman and managing director NK Nanda, due diligence of both the coal projects has started, while a similar exercise would be undertaken in the case of the iron ore property in the second half of this month. Nanda told Business Standard that the state-owned miner was currently holding discussions with Carabella Resources of Australia for acquisition of the latter's 50-million-ton coking coal project. The cost of the acquisition was estimated to be in the range of $150-200 million. "We have signed a non-disclosure agreement in this regard," Nanda said, adding that due diligence of the property would be completed by this month-end. As per the preliminary estimates, this project, which involves open cast mining, requires an overall capital expenditure of around $1 million. Nanda said that NMDC would be using Legacy Iron Ore Limited for acquisitions and development of mineral assets in Australia. The company has acquired 50% equity in the Australian firm last year and inducted three directors in it with Nanda as chairman. The other assets the company is following in Australia for some time included a rock phosphate mine which is now under due diligence process. "Once it is over, we may go ahead with the acquisition process," Nanda said. Nanda said that the initial investment on this mine would be $200 million. Of this, $100 million would be for acquisition and an equal amount for exploration and development. This apart, he said, the directors of South Africa's Kopano Ke Matla Investment Company, a joint venture partner of NMDC, would be coming to India in the third week of this month and "finalise some promising acquisitions". NMDC had entered into a partnership with Kopana last year for acquisition of iron ore, coal and manganese assets in South Africa. Source: Business Standard

February 6, 2012: Having signed a joint venture (JV) for manufacturing transformer laminate, Korean steel giant Posco and Ahmedabad-based Poggenamp Nagarsheth Powertronics Pvt Ltd (PNPPL) are eyeing a Rs 250 crore turnover by 2014. The 74:26% equity based JV between PNPPL and Posco recently launched the facility for manufacturing cold rolled non grain oriented (CRNGO) steel at Vavdi, Kheda near Ahmedabad. Both PNPPL and Posco have together invested around Rs 72 crore in the ratio of 74:26. With the CRNGO raw material being in short supply in India, PNPPL used to source the same from Posco. "However, we have now entered into a JV wherein apart from equity Posco will also assist us in sales of the laminates for transformers. While in 2013 we are looking at a Rs 150 crore turnover out of the JV, by 2014 we expect it to rise to Rs 250 crore. We will commission the plant by February end this fiscal," said Nagarsheth. The group turnover of Poggenamp is expected to be around Rs 400 crore by 2014, including Rs 150 crore turnover of PNPPL. Apart from catering to the domestic market, the new plant will look at exporting 25% by 2012 to over 20 countries in regions like Middle East, South East Asia, the US, Canada, Europe and Africa. By 2013, the company is looking at 70% capacity utilisation. "While we targeting 25% exports in 2012, by next year we intend to raise to 35%. On the domestic front, the plant will initially supply to three exclusive territories including Gujarat, Rajasthan and Madhya Pradesh," Nagarsheth added. Source: Business Standard

February 3, 2012: State-run NMDC Limited has recorded a sharp increase of 22.45% in net profits during the quarter ended December 31, 2011 as compared to the corresponding period last year. Net profit during Q3FY12 stood at Rs 1,858.81 crore as against Rs 1,518.03 crore recorded during corresponding period last year. Sales turnover of the company during Q3FY12 stood at Rs 2,821.95 crore while it stood at Rs 2,621.22 during the quarter ended December 31, 2010. Total income of the company during this quarter stood at Rs 3,347.34 as against Rs 2,915.94 earned during the corresponding period of previous year. The largest domestic iron ore producing company also made its first overseas acquisition during the quarter, purchasing a 50% stake in Australia's Legacy Iron Ore for about Rs 92 crore, the company said in a statement. Currently, the company is also doing due diligence to acquire two other Australian properties -- the Ridley iron ore deposit of Atlas Mining and the Wonarah phosphate reserve of Minemakers Ltd. The process is expected to be completed in the next one or two months. On the domestic front, construction of the company's first steel plant of 3-mtpa capacity in Chhattisgarh's Nagarnar district is in full swing, as most of the packages have been awarded for the project. The plant is expected to be commissioned in 2014. During the quarter, the company also signed an agreement with Russia's Severstal to set up a steel plant in Karnataka, which will have an initial production capacity of 3 mtpa. NMDC will supply iron ore to the plant, while coking coal will be sourced from the Russian firm's mines, the statement added. Source: ISMW

February 3, 2012: Tata Motors' total sales (including exports) of Tata commercial and passenger vehicles in January 2012 stood at 80,382 vehicles, up by 16% over the number of vehicles sold in January 2011. The company's sales of commercial vehicles in January 2012 in the domestic market were 45,713 recording a growth of 14% as compared to 40,263 vehicles sold in January last year. However, cumulative sales of commercial vehicles in the domestic market for the fiscal are 420,045, a growth of 18% over last year. The company's sales from exports stood at 7,083 vehicles in January 2012, up by 43% as compared to 4,948 vehicles in January 2011. Source: ISMW

February 3, 2012: Buoyed by the success of the 'Steel Village' initiative in Vizag, the Institute for Steel Development and Growth (INSDAG) is looking forward to steel majors SAIL and Tata Steel to replicate the model in West Bengal. "We are looking to SAIL, Tata Steel to sponsor such projects in West Bengal," INSDAG director general Sushim Banerjee said on February 2. Stating that the Vizag project has been a major success, he said, "The initial cost for a steel house is slightly higher as compared to traditional constructions, but the former has major advantages in terms of faster installation and almost zero maintenance." Meanwhile, INSDAG is also talking with other steel majors such as Essar and Jindal to take up its entrepreneurial development initiative in western and southern Indian states, respectively. "Essar has its plants in Gujarat and wants us to do something there. Jindal, on the other hand, has presence in south and could help us by providing steel to the potential entrepreneurs in that region," Banerjee added. Source: ISMW

February 3, 2012: India's steel consumption is likely to grow by around 6% in 2011-12, according to an estimate by the Institute for Steel Development and Growth (INSDAG). This is a marginal improvement over 4-5% growth forecast earlier. However, the 6% growth rate will still fall below the targeted rate of 8-10%. According to steel ministry data, steel consumption grew by 4.2% to 45.20 million tons (mt) during April-November 2011. Commenting on the domestic steel market scenario, INSDAG director general Sushim Banerjee said the demand growth is expected to improve significantly in the next five years and may reach double digit depending on the economic performance of the country. Referring to INSDAG's new initiatives to promote steel consumption in rural areas, Banerjee said, "If steel fabrication activity picks up due to this campaign, we can look forward to even 20% growth in consumption a few years from now." Overall, India has a per capita steel consumption of 30 kgs, much lower than the world average of 140 kg. "As a result, there is ample scope for growth and the long term prospects remain bright," he added. Source: ISMW

February 3, 2012: State-owned Steel Authority of India will again call for quotations from mining contractors to develop a greenfield coking coal mine in which it hopes to, for the first time, also outsource rehabilitation of local people as part of the mine development programme. The hunt for a mining contractor willing to run the 4-MT mine, coal washery and take on resettlement and rehabilitation of 3,500 families at the Tasra block, Jharkhand, at an affordable price has proven difficult. This month when SAIL invites tenders for an MDO for the 117-MT Tasra block, it will be the fourth time, having failed in its last three attempts. To attract increased response, SAIL is also considering offering washed coal rejects to the selected contractor for use in power generation. This proposal will however have to be first cleared by the SAIL board before the tender is announced, said the official. Coking coal is the second most important raw material for steelmaking after iron ore, and is present in limited deposits in India, prompting most steelmakers to entirely import the mineral. SAIL, which imports 70% of its coking coal requirement, has been vulnerable to price fluctuations. In the second quarter, SAIL's profits fell 55% largely due to high coal prices. The company is scheduled to announce its third quarter earnings in February. The government had allocated the Tasra and Sitanala coal blocks in Jharkhand, to SAIL in 1996 and 2007 respectively. "What we have been allocated so far will not amount to more than 2 MT of washed coal. We've asked for three blocks in Jharkhand; Jhirki in East Bokaro coalfield, Rohne-Routpara (West) and Routpura in North Karanpura coalfields," said the official. At a recent review of captive coal allocations, SAIL informed the Coal Ministry that it was on track to get the two blocks up and running soon. Sitanala is a smaller mine with 41MT of underground deposit. Source: The Economic Times

February 3, 2012: Visakhapatnam Steel Plant (VSP) registered a record sales turnover of Rs 11,372 crore during the period April 2011-January 2012, which represents a growth of 24% over the corresponding period last year. The sales turnover corresponds to 124% fulfillment of MOU target committed with the Ministry of Steel, Government of India. VSP had made yet another record of posting sales turnover of Rs 1,428 crore during January, 2012 which was the best ever January since inception. Further, during the month of January 2012, inventory of saleable steel has been reduced by 44 thousand tonnes, according to a release here today. VSP had been registering sales turnover of more than Rs 1,000 crore month after month continuously from June, 2011 onwards. Chairman and Managing Director of VSP, AP Choudhary, while expressing happiness over the performance of the plant congratulated the Marketing Collective for achieving excellent performance in commercial activity. The VSP could achieve this performance in spite of the difficult market conditions both in the domestic and international markets being subdued. Such consistently high performance in sluggish steel market was mainly due to dynamic market mix, strong team work and focus on customer service, he said in a release. During the period VSP has expanded the Distribution Network by opening of two new Consignment Sales Agency outlets. at Bhopal and Jabalpur. The Hyderabad stockyard with the new Railway siding inside the yard was opened in the month of January, 2012 to allow the Railway wagons to come inside the Stockyard facilitating faster unloading the materials and improving the customer service. VSP has also added six new Rural Dealers during January 2012 taking the total number of Rural Dealers to 223, the release added. Source: The Economic Times

February 3, 2012: The National Green Tribunal (NGT) has fixed February 22 for hearing the appeal challenging environmental clearance granted to the Posco's mega steel project in Orissa. All the parties related to the case presented their arguments at the NGT. The parties involved in the case are petitioner Prafulla Samantray, Union ministry of environment and forest, Orissa State Pollution Control Board and Posco India. "After listening to all the parties the NGT has fixed February 22 as the next date of hearing," said Samantray, who had filed a petition in the tribunal, challenging the MoEF decision to grant environmental clearances to the steel and port projects of Posco India. He argued that the environment impact assessment was faulty, public consultation process was not properly done and the Environment Ministry had overlooked the recommendations of the Meena Gupta committee which the ministry itself had constituted to look into the mega project. MoEF in January, 2012 had stated that the environmental clearance to the proposed steel project has been accorded abiding by the laws. It may be noted that the tribunal, in August last year, had served notices to the MoEF, Orissa State Pollution Control Board and Posco India asking about the circumstances under which the environmental clearance was given to the Posco's Rs 54,000 crore project in the state. Source: Business Standard

February 1, 2012: Prime Minister Manmohan Singh on January 31 presented the MoU Excellence Award in the Mining & Metals category to Steel Authority of India Limited. The award was received by SAIL chairman C.S. Verma in the presence of Minister for Heavy Industries & Public Enterprises Praful Patel at a function held at Vigyan Bhawan, organised jointly by Department of Public Enterprises and Standing Conference of Public Enterprises (SCOPE). On receiving the award, Verma said, "The fact that SAIL has been winning this award year after year stands testimony to our internal strength and our deep-rooted values. The award is an acknowledgement of our efforts, and we shall strive ceaselessly to keep improving and bettering ourselves". Starting from 2002-03, it is for the eighth consecutive year that SAIL has won the MoU Excellence Award. Source: ISMW

February 1, 2012: Rashtriya Ispat Nigam Ltd's (RINL's) Vishakhapatnam Steel Plant has produced its first billet from its expansion to 6.3 million tons per annum (mtpa) in January 2012. The expansion activities are in full swing for commencement of production from the other new units as well, the company said in a statement. The blast furnace of 3800 cum capacity, the biggest among the PSU steel plants, got lighted up in December and is all set to commence production shortly, the statement said. The steel melting shop is also ready and is under integrated commissioning. The new oxygen plant which was commissioned recently is now operating at 100% capacity. Apart from the main production units, the auxiliary units such as the power system comprising of around 30 major sub-stations, water system consisting of around 16 major pumping stations, various utility & gas systems, etc. have been commissioned and are under operation. In order to meet the growing requirements of wire rods in the country, RINL has installed an 8 lakh tons per annum capacity state-of-the-art high speed wire rod mill which would produce much superior quality wire rods. The completion of this mill next month would further establish the leadership of RINL in this segment. RINL has already supplied 2.8 lakh tons of wire rods in the current fiscal, the highest amongst the suppliers in the country such as SAIL, Tata, etc, the statement added. Source: ISMW

February 1, 2012: The steel industry is expected to see a recovery in the March-April period of the current calendar year as work for the new projects pick up, Nirmal Agarwal, director at the Adhunik Group, told ISMW. "After the elections in the states, the budget the work for the held up and new projects are likely to pick up," Agarwal said. The softening interest rate scenario would provide the required push for the projects, he said, adding that the coming general elections in 2014 would keep the central government in their toes as they need to perform. Agarwal said the capacity utilisation of the steel mills has increased over time and most of the mills are currently operating at over 80-90% capacity. The easing coking coal prices along with the appreciation of the rupee would help the Indian mills get an average coking coal cost of around $170/ton in two months' time from around $200/ton now. The Indian steel mills combine different varieties of coking coal, including hard and soft varieties, to charge its blast furnaces. Source: ISMW

February 1, 2012: Hot rolled coil producers may leave their domestic base prices for February unchanged from this month's levels, market sources told ISMW on January 31. The rupee's continued appreciation against the US dollar may make imports attractive, sources said. It may not be possible to hike prices now since the rupee is stronger and demand is also moderate, sources said. The Indian currency had rebounded to Rs 49.7 against the dollar as of January 31 from Rs 50.4 two weeks earlier. It had fallen to about Rs 53.7 in the last fortnight of December. Since early January, Indian mills have been offering structural HRC of 3mm thickness at Rs 34,500-36,000/ton ex-works, up from Rs 34,000-35,000/ton in December. Prices in Mumbai's retail market have fallen by Rs 500-1,000/ton over the past fortnight, partly impacted by the exchange rate fluctuations. Source: ISMW

February 1, 2012: Met coke import prices rose in January owing to some rebound in demand from steel mills. However, till now the mills in India are faced with iron ore shortage owing to the mining ban in three districts of Karnataka and operating at lower capacity, sources said. According to information available with ISMW, import of met coke through three major ports (Kolkata, Paradip and Mormugao) of India fell to around 40,225 tons in December compared with 103,462 tons (Kolkata, Paradip and Vizag) in November 2011 and the trend remained almost unchanged in January 2012 as well. The prices of imported met coke were hovering around $385/ton as on January 27, as compared to $363/ton at the beginning of January. The domestic prices of coke hovered around Rs 19,000/ton. India's met coke demand, which is currently estimated at 33 million tons per annum (mtpa) domestically, is expected to shoot up to 58 mtpa in the next five years, as steel makers increase capacity, according to industry estimates. Source: ISMW

February 1, 2012: The prices of premium hard coking coal remained flat in January, but that of mid vol firmed up even as prices of Low Vol PCI coal and semi soft varieties slipped further on lower offers from both India and China during the month of January 2012, industry sources told ISMW. Thin liquidity marked the global trade. Premium Low Vol prices was quoted at around $218/ton as on January 26 as compared to quoted price of $220 a ton on December 30, 2011. HCC 64 Mid Vol, however, rose by $6/ton to $200/ton fob from $194/ton on December 30. As for Indian demand, although there was clearly some interest, not many transactions actually took place. Traders described the some marginal increase in Indian interest as a "blip," and predicted that attractive US offers may fill some of that appetite. US mid-to-high-vol blends well with 27-29% VM Australian coal. US coking coal with below 1% sulphur, 9-10% ash were heard offered to India at around $215/ton cfr. The low demand from India was attributed to a scarcity of iron ore facing the steel sector. The Indian steel plants are still reeling under a shortage of iron ore and have reduced its coal consumption substantially. The depreciation of rupee against the US dollar by almost 20% between October and December 2011 had also pushed up import prices resulting in lesser imports of the steel making raw material. Big steel companies were hurt the most as a large part of their coking coal requirement is met through imports. In 2010-11, domestic steelmakers imported close to 28 mt of the raw material. However, following some appreciation of the Indian currency since the beginning of 2012, imports may look up in near future. The Indian currency, which slid to over Rs 53 per US dollar, is now trading at Rs 49.75 per US dollar on January 31. The depreciation of the rupee had offset the advantage that companies may have gained due to softening of coking coal prices in the third quarter (October-December), industry experts said. Adding to this, the lower demand for finished steel products had forced steel mills to roll over prevailing prices. This in turn has forced them to curtail capacity utilisation levels to let ends meet, resulting in lesser demand for coking coal. However, Indian steel makers have managed to hike prices in January following slightly better demand to offset the impact of higher raw material cost and it is expected that demand would continue to remain up that would lead to higher capacity utilisation and consequent higher demand for coking coal. Despite expectation of a revival in Indian steel demand, market experts believe that coking coal prices may not firm up due to comparatively lower demand from Chinese steel makers. Traders felt that Indian market has stabilised, but buyers of coking are unlikely to consider buying spot cargos above the January-March quarter benchmark price of $235/ton for top-quality material. Source: ISMW

February 1, 2012: The SAIL-led consortium that bagged mining rights for three iron ore mines at Hajigak will sign the final agreement with the Afghanistan government soon, a top official said. "We are in the process of finalising the documentation and will soon be in a position to finalise and sign the document," SAIL chairman C.S. Verma said. The final agreement will entitle SAIL-led consortium Afisco ( Afghan Iron and Steel Consortium) to explore, develop and exploit the Hajigak deposits. Verma said the consortium had sent a team to negotiate the agreement and the first round of discussions has taken place. The team recently returned to India after successful negotiations. Aifsco, which had in November last year bagged the mining rights for the three blocks, plans to invest $10.8 billion over 8-10 years to develop the mines as well as set up a 6.12 million tons per annum steel plant and a 800-MW power plant. As part of the necessary internal infrastructural support, the consortium plans to build 200 km each of rail, road and transmission lines for the mine and steel project. The three iron ore blocks hold an estimated 1.28 billion tons of high-grade iron ore reserves. SAIL has the maximum 20% stake in Aifsco, while NMDC and RINL each hold a stake of 18%. Private players JSW Steel and JSPL hold 16% each, while JSW Ispat and Monnet Ispat & Energy hold 8% and 4%, respectively. Source: The Economic Times

February 1, 2012: Last January, the Union environment ministry's approval for the Rs 52,000-crore mega steel project by Korean giant Posco at Orissa's Jagatsinghpur district made headlines. A year down the line, nothing has moved. While land acquisition remains the biggest challenge despite paper clearances, there's an additional problem, with the district administration having Korean employees from visiting the project site. Says Posco India vice-president, Vikash Sharan: "We are at a loss to understand the recent order from the district administration, (issued) in the name of the law and order condition. How can such projects land up in a situation like this?" There is no point in selling India as an investment destination at Davos when the investments which have already come are facing multiple problems and not able to move forward, he said. The ministry had first granted environmental clearance in 2007. The project was re-appraised in 2010-11 by its Expert Appraisal Committee. After the review, then minister Jairam Ramesh had issued the final order granting environmental clearance to the project, with additional conditions, in January 2011. Another key clearance for the project, for diversion of 1,253 hectares of forest land, came later, in May. As of January 31, no clearance is pending at the central government. However, there is a case on against Posco based on a petition at the National Green Tribunal. Asked about the developments since last year's nod, the company spokesperson said, "Posco India has established its site office in December 2011 near Nuagaon village to improve communication with the local community and also to co-ordinate pre-construction activities." However, no substantial construction work has started yet, as the state government is yet to hand over the land required for the plant. Of the 4,004 acres required, 3,586 acres belongs to the state government. Around 578 acres of non-forest revenue land has been leased but this is scattered in small pieces. "Its physical possession will be meaningful only along with handing over of the remaining land. Posco is waiting for land acquisition to be completed by the state government," Sharan said. Though Posco India declined to disclose the quantity of investments made in India so far, it says this was significant. "Posco India has made substantial investment towards statutory payment for forest diversion and compensation to affected people through Idco (an Orissa government agency) who have parted with their land." Besides, Posco made investments on stablishment of site office, conducting skill development programmes for locals, constructing and running transit camps for families externed by project opponents, supporting local schools and flood relief operations, Sharan added. A recently filed status report by the Orissa government claimed 2,000 acres had been acquired so far. Source: Business Standard