Spot imports will account for 83 percent of China's iron ore imports this year, the China Iron and Steel Association said in a half-year report, while decrying the "disorderly" market that it blames for rising prices.
Chinese mills have not yet settled on an annual price for term iron ore imports, meaning most is being imported on a spot or indexed basis.
Steel production soared in the first half of the year, while imports also rose as Chinese fixed-asset investment responded to a government stimulus package, said the report, issued on the website of the Ministry of Industry and Information Technology.
In the report, CISA reiterated its intent to limit imports to end-users or to trading companies that can prove they have already contracted an end-user, to fight "speculative" imports.
CISA took over as lead negotiator for the Chinese industry this year in annual price talks with Australian miners Rio Tinto, BHP Billiton and Brazil's Vale, but has failed to settle due to its insistence on wringing a better deal than the 33 percent drop negotiated by Japanese and South Korean mills.
Ore prices have risen substantially since the Japanese and South Korean settlement.
CISA is just "clinging to the feet of the Buddha," a Chinese steel analyst was cited as saying in an International Finance News article on the CISA report, using a Chinese idiom for desperately snatching any solution that presents itself.
Source: Reuters
Wednesday, August 5, 2009
Ferrexpo's Profits Plunge 80 Per Cent
Ferrexpo Plc, the producer of iron ore in Ukraine, said first-half profit slumped 80 percent after demand for the steelmaking ingredient weakened.
Net income slipped to $28.5 million, or 4.87 cents a share, from $141.4 million, or 23.14 cents, a year earlier, Baar, Switzerland-based Ferrexpo said in a statement today. Sales declined 42 percent to $301.8 million. The declaration of its interim dividend will be deferred until October.
Trading reached a “low point” in the first half, Ferrexpo said in the statement. “We should be trading more profitably in the second half.”
There are signs of “normalization” in the iron-ore trade and strengthening regional consumption, while Chinese demand remains “robust,” the company said. Iron ore for immediate delivery to China, the biggest buyer, climbed to the highest in nine months last week, trading above the annual benchmark price agreed between Rio Tinto Group and mills in Japan, South Korea and Taiwan.
Source: Bloomberg
Net income slipped to $28.5 million, or 4.87 cents a share, from $141.4 million, or 23.14 cents, a year earlier, Baar, Switzerland-based Ferrexpo said in a statement today. Sales declined 42 percent to $301.8 million. The declaration of its interim dividend will be deferred until October.
Trading reached a “low point” in the first half, Ferrexpo said in the statement. “We should be trading more profitably in the second half.”
There are signs of “normalization” in the iron-ore trade and strengthening regional consumption, while Chinese demand remains “robust,” the company said. Iron ore for immediate delivery to China, the biggest buyer, climbed to the highest in nine months last week, trading above the annual benchmark price agreed between Rio Tinto Group and mills in Japan, South Korea and Taiwan.
Source: Bloomberg
Business As Usual For Small Iron Ore Miners
Small-capped Australian iron ore miners say it is business as usual with Chinese steelmakers despite protracted negotiations between China and mining giants Rio Tinto and BHP Billiton to settle an annual benchmark price.
The current pricing debacle with China's steel industry has not hampered the small cap's negotiations with the world's largest steelmaking country -- and they have settled prices using methods that satisfy their Chinese customers.
Atlas Iron -- which sells to four different Chinese mills -- uses what it calls a "mutual fairness clause" to settle prices, Atlas's managing director David Flanagan said on the sidelines of the Diggers and Dealers mining conference in Western Australia.
"We've got agreements which are based on a benchmark, but then if the spot price ... varies above or below the benchmark by a certain point amount ... we would average so we'll get half of the upside, but also share half the downside," Flanagan said.
Meanwhile, Grange Resources in which Jiangsu Shagang Group -- China's largest non-government steelmaker -- has a shareholding, prices its iron pellets according to the price agreed by Vale and Japanese mills at the Brazilian port of Tubarao, Grange's managing director Russell Clark said.
Fortescue Metals Group Ltd also has reported no interruptions to shipments to more than two dozen Chinese steel mills this year.
On Tuesday, Chinese media said the iron ore price talks with Rio Tinto (RIO.L) and BHP Billiton were suspended due to "spot price distortions," but minutes later retracted the story as a "mistake."
China, whose steel mills are burdened by overcapacity, has been holding out for a 40-45 percent price cut, even though Japanese and Korean steelmakers have signed off on a 33 percent steel cut.
China Iron and Steel Association, the defacto negotiator for the country's steel mills in annual term iron ore price talks, said last week that excess iron ore imports were a serious hindrance in this year's negotiations.
China's iron ore imports jumped 29 percent in the first six months of this year to 297 million tonnes, although the pace is expected to slow to around 236 million tonnes in the second half as soaring spot prices encourage the reopening of idled domestic mines.
The current system, which involves annual negotiations between major miners and steelmakers is too rigid and needs to be revised, some executives said.
"I personally find the benchmark annual setting too long," Clark said. "The benchmark being set every three months? Perhaps that's what happens, which I think will be a nice halfway point. It's liquid but it's controlled."
Spot iron ore vessel bookings from Brazil to China jumped to a record in July and shipments from Australia picked up towards the end of the month, according to data specialist ASXMarine, signalling that demand from the world's top steelmaker remains firm even after record imports in the first half of the year.
As of now, Australia's smaller iron ore miners have been relatively unshaken by the political debacle in China, including the detentions of four Shanghai-based iron ore employees of Rio Tinto over spy allegations.
"We've talked in loose terms about the Rio deal in so far as 'it's a shame'," Clark said, referring to Shagang.
"But as a private company, they tend to run pretty quietly in China -- they don't want to make a lot of noise," Clark said.
Source: Reuters
The current pricing debacle with China's steel industry has not hampered the small cap's negotiations with the world's largest steelmaking country -- and they have settled prices using methods that satisfy their Chinese customers.
Atlas Iron -- which sells to four different Chinese mills -- uses what it calls a "mutual fairness clause" to settle prices, Atlas's managing director David Flanagan said on the sidelines of the Diggers and Dealers mining conference in Western Australia.
"We've got agreements which are based on a benchmark, but then if the spot price ... varies above or below the benchmark by a certain point amount ... we would average so we'll get half of the upside, but also share half the downside," Flanagan said.
Meanwhile, Grange Resources in which Jiangsu Shagang Group -- China's largest non-government steelmaker -- has a shareholding, prices its iron pellets according to the price agreed by Vale and Japanese mills at the Brazilian port of Tubarao, Grange's managing director Russell Clark said.
Fortescue Metals Group Ltd also has reported no interruptions to shipments to more than two dozen Chinese steel mills this year.
On Tuesday, Chinese media said the iron ore price talks with Rio Tinto (RIO.L) and BHP Billiton were suspended due to "spot price distortions," but minutes later retracted the story as a "mistake."
China, whose steel mills are burdened by overcapacity, has been holding out for a 40-45 percent price cut, even though Japanese and Korean steelmakers have signed off on a 33 percent steel cut.
China Iron and Steel Association, the defacto negotiator for the country's steel mills in annual term iron ore price talks, said last week that excess iron ore imports were a serious hindrance in this year's negotiations.
China's iron ore imports jumped 29 percent in the first six months of this year to 297 million tonnes, although the pace is expected to slow to around 236 million tonnes in the second half as soaring spot prices encourage the reopening of idled domestic mines.
The current system, which involves annual negotiations between major miners and steelmakers is too rigid and needs to be revised, some executives said.
"I personally find the benchmark annual setting too long," Clark said. "The benchmark being set every three months? Perhaps that's what happens, which I think will be a nice halfway point. It's liquid but it's controlled."
Spot iron ore vessel bookings from Brazil to China jumped to a record in July and shipments from Australia picked up towards the end of the month, according to data specialist ASXMarine, signalling that demand from the world's top steelmaker remains firm even after record imports in the first half of the year.
As of now, Australia's smaller iron ore miners have been relatively unshaken by the political debacle in China, including the detentions of four Shanghai-based iron ore employees of Rio Tinto over spy allegations.
"We've talked in loose terms about the Rio deal in so far as 'it's a shame'," Clark said, referring to Shagang.
"But as a private company, they tend to run pretty quietly in China -- they don't want to make a lot of noise," Clark said.
Source: Reuters
Atlas To Increase Copper Production At Toledo Mine
Atlas Consolidated Mining and Development Corp the Philippines' second-largest miner, plans to increase copper concentrate production at its Toledo mine as it ships more of the concentrate to China, the company said on Tuesday.
Encouraged by higher prices, some metals producers worldwide are reopening mines and expanding capacity in anticipation of a pick-up in demand as the global economy mends.
Atlas said it planned to increase mining and milling production rate at its Toledo mine in central Cebu province to 35,000 tonnes per day (tpd) this month from 20,000 tonnes (tpd) at present.
"Forward planning and development activities are well under way to increase production to 42,000 tpd by mid-2010, and approximately 50,000 tpd by the second quarter of 2011," Atlas said in a statement to Manila's stock exchange.
Copper prices in London MCU3 touched a 10-month high of $6,070 a tonne on Tuesday, and nearly doubled values this year, thanks to firm Chinese demand and signs the world economy is pulling out of recession.
Atlas said it has shipped 37,832.26 wet metric tons (wmt) of copper concentrate so far to China, for processing as part of a 60,000-tonne supply deal with Swiss firm MRI Trading. Further shipments, totalling 11,000 wmt, are expected this month.
Operations at the Toledo mine, estimated to have deposits of 874 million tonnes of copper ore with an average grade of 0.41 percent, resumed in July last year after a 14-year hiatus due to lack of funding to repair damage caused by typhoons.
Source: Reuters
Encouraged by higher prices, some metals producers worldwide are reopening mines and expanding capacity in anticipation of a pick-up in demand as the global economy mends.
Atlas said it planned to increase mining and milling production rate at its Toledo mine in central Cebu province to 35,000 tonnes per day (tpd) this month from 20,000 tonnes (tpd) at present.
"Forward planning and development activities are well under way to increase production to 42,000 tpd by mid-2010, and approximately 50,000 tpd by the second quarter of 2011," Atlas said in a statement to Manila's stock exchange.
Copper prices in London MCU3 touched a 10-month high of $6,070 a tonne on Tuesday, and nearly doubled values this year, thanks to firm Chinese demand and signs the world economy is pulling out of recession.
Atlas said it has shipped 37,832.26 wet metric tons (wmt) of copper concentrate so far to China, for processing as part of a 60,000-tonne supply deal with Swiss firm MRI Trading. Further shipments, totalling 11,000 wmt, are expected this month.
Operations at the Toledo mine, estimated to have deposits of 874 million tonnes of copper ore with an average grade of 0.41 percent, resumed in July last year after a 14-year hiatus due to lack of funding to repair damage caused by typhoons.
Source: Reuters
Tuesday, August 4, 2009
Moly Mines In Talks With Chinese Iron Ore Importers
Moly Mines Ltd., seeking to build a A$604 million ($511 million) molybdenum mine in Australia, is in talks with Chinese groups for iron ore sales accords from an adjoining deposit amid surging demand.
“We are getting a knock on the door from a Chinese party about once a week now,” Derek Fisher, managing director of the Perth-based company, said today by phone from Kalgoorlie, Western Australia. “We are getting a fair amount of attention particularly from the smaller to intermediate mills.”
Moly surged 55 percent Sydney in trading this week after yesterday announcing plans to start output by the first quarter of next year from an iron ore mine being developed at Spinifex Ridge in Western Australia. China, the world’s biggest buyer of iron ore, is securing supplies to feed demand from steel mills.
“We will have something signed off in the next few weeks,” Fisher said, adding that he’s meeting with a Chinese group today at the annual Diggers and Dealers Conference. Sales contracts will may include an equity stake in the company, he said.
Moly jumped 24 percent to 81.5 cents at 1:11 p.m. Sydney time. The company is seeking to produce 1 million tons of the iron ore annually from the A$20 million mine, Fisher said.
The company delayed starting its Spinifex Ridge molybdenum mine last year as the worst credit crisis since the Great Depression froze lending and curbed demand for the metal used in steelmaking. A rebound in prices and a thawing of the debt market may help the company secure mine financing, Fisher said.
“These are the sort of moly prices we believe the project is financeable at,” he said. “We’ve got to wait for the debt market to come back but it’s looking pretty favorable.”
Source: Blomberg
“We are getting a knock on the door from a Chinese party about once a week now,” Derek Fisher, managing director of the Perth-based company, said today by phone from Kalgoorlie, Western Australia. “We are getting a fair amount of attention particularly from the smaller to intermediate mills.”
Moly surged 55 percent Sydney in trading this week after yesterday announcing plans to start output by the first quarter of next year from an iron ore mine being developed at Spinifex Ridge in Western Australia. China, the world’s biggest buyer of iron ore, is securing supplies to feed demand from steel mills.
“We will have something signed off in the next few weeks,” Fisher said, adding that he’s meeting with a Chinese group today at the annual Diggers and Dealers Conference. Sales contracts will may include an equity stake in the company, he said.
Moly jumped 24 percent to 81.5 cents at 1:11 p.m. Sydney time. The company is seeking to produce 1 million tons of the iron ore annually from the A$20 million mine, Fisher said.
The company delayed starting its Spinifex Ridge molybdenum mine last year as the worst credit crisis since the Great Depression froze lending and curbed demand for the metal used in steelmaking. A rebound in prices and a thawing of the debt market may help the company secure mine financing, Fisher said.
“These are the sort of moly prices we believe the project is financeable at,” he said. “We’ve got to wait for the debt market to come back but it’s looking pretty favorable.”
Source: Blomberg
China Imports 56Mn Tonnes Of Iron Ore In July
China's main ports received 56.5 million tonnes of iron ore imports in July, the second highest monthly total on record, the Ministry of Transport said on Tuesday.
Despite bulging stockpiles and rising prices, imports over the month rose by 35 percent compared with July 2008, a report on the ministry's website said.
Imports over the first six months of 2009 stood at 297 million tonnes, up 29.3 percent compared with last year.
Last week, the China Iron and Steel Association said excess iron ore imports had undermined its position during negotiations with global miners on new long-term benchmark prices.
The association, which has led China's negotiations with Australia's Rio Tinto, BHP Billiton and Brazil's Vale this year, is urging the government to revoke the vast bulk of the country's iron ore import licences.
Source: Reuters
Despite bulging stockpiles and rising prices, imports over the month rose by 35 percent compared with July 2008, a report on the ministry's website said.
Imports over the first six months of 2009 stood at 297 million tonnes, up 29.3 percent compared with last year.
Last week, the China Iron and Steel Association said excess iron ore imports had undermined its position during negotiations with global miners on new long-term benchmark prices.
The association, which has led China's negotiations with Australia's Rio Tinto, BHP Billiton and Brazil's Vale this year, is urging the government to revoke the vast bulk of the country's iron ore import licences.
Source: Reuters
Indonesia On Alert Over China Steel Exports
Trade minister Mari Elka Pangestu said the government would closely watch out for a possible shift in Chinese steel exports from the European Union to Indonesia after the EU imposed an anti-dumping import duty on Chinese products.
"We certainly are quite alert," she said after attending a plenary meeting of the House of Representatives in which President Susilo Bambang Yudhoyono presented the 2010 draft state budget.
Mari Pangestu said imports of iron and steel had been tightly regulated and therefore it was hoped no illegal imports would happen threatenening local industries.
"It isn`t that we already have regulations for verifying steel and iron imports. So we have safeguarded it. Hopefully no illegal imports or dumping would occur," she said.
The European Union had announced the imposition of anti-dumping import duty for iron and steel products from China as of October 2009. The duty is set at between 17.7 percent to more than 30 percent.
Because of the high duty the Chinese exporters will have to pay for exports to the EU it is feared they would shift their exports to Indonesia as a potential market.
Indonesia meanwhile plans to impose a safeguard on imports of nail and wire soon. "The regulation of the finance minister still has yet to be issued. It is still with the finance ministry," she said.
Source: Antara
"We certainly are quite alert," she said after attending a plenary meeting of the House of Representatives in which President Susilo Bambang Yudhoyono presented the 2010 draft state budget.
Mari Pangestu said imports of iron and steel had been tightly regulated and therefore it was hoped no illegal imports would happen threatenening local industries.
"It isn`t that we already have regulations for verifying steel and iron imports. So we have safeguarded it. Hopefully no illegal imports or dumping would occur," she said.
The European Union had announced the imposition of anti-dumping import duty for iron and steel products from China as of October 2009. The duty is set at between 17.7 percent to more than 30 percent.
Because of the high duty the Chinese exporters will have to pay for exports to the EU it is feared they would shift their exports to Indonesia as a potential market.
Indonesia meanwhile plans to impose a safeguard on imports of nail and wire soon. "The regulation of the finance minister still has yet to be issued. It is still with the finance ministry," she said.
Source: Antara
Patriot Idles West Virginia Coal Mine
Patriot Coal Corp. plans to close another mine in West Virginia and lay off 315 workers in response to slumping demand.
Production at the Samples surface mine has ceased and employees have stopped reporting to work but they will officially be laid off Oct. 5, according to Janine Orf, a Patriot spokeswoman.
“As we continue to balance our production levels with the soft thermal coal demand, our strategy is to concentrate production at lower-cost mining complexes,” Chief Executive Richard Whiting said in a statement. “By ceasing operations at this higher-cost surface mine, Patriot will keep valuable permitted reserves in the ground until the market yields more favorable pricing and margins. We appreciate the contributions of the employees at the Samples mine over the years and regret that these challenging markets have required us to take this action.”
This closure follows the idling of four other Patriot mines in West Virginia this year.
Last week, Patriot cut its production estimates to between 33 million and 35 million tons in 2009, down from 34 million to 36 million.
The coal company also said it nearly tripled its profit in the second quarter thanks to its acquisition of Magnum Coal Co. last year.
Creve Coeur-based Patriot Coal Corp. is the third-largest producer and marketer of coal in the eastern United States.
Source: St Louis Business Journal
Production at the Samples surface mine has ceased and employees have stopped reporting to work but they will officially be laid off Oct. 5, according to Janine Orf, a Patriot spokeswoman.
“As we continue to balance our production levels with the soft thermal coal demand, our strategy is to concentrate production at lower-cost mining complexes,” Chief Executive Richard Whiting said in a statement. “By ceasing operations at this higher-cost surface mine, Patriot will keep valuable permitted reserves in the ground until the market yields more favorable pricing and margins. We appreciate the contributions of the employees at the Samples mine over the years and regret that these challenging markets have required us to take this action.”
This closure follows the idling of four other Patriot mines in West Virginia this year.
Last week, Patriot cut its production estimates to between 33 million and 35 million tons in 2009, down from 34 million to 36 million.
The coal company also said it nearly tripled its profit in the second quarter thanks to its acquisition of Magnum Coal Co. last year.
Creve Coeur-based Patriot Coal Corp. is the third-largest producer and marketer of coal in the eastern United States.
Source: St Louis Business Journal
Lula Floats Vale Re-Nationalisation Plan
According to Brazil's most respected weekly magazine, Veja, the President of Brazil, Luiz Inácio Lula da Silva, wants the government to take control of mining giant multinational Vale SA, formerly known as Companhia Vale do Rio Doce (CVRD).
Allegedly Lula asked officials inside his government to find a legal way to ensure the government controls Vale through Previ and BNDES Participações SA, the investment arm of Brazil's state development bank, the São Paulo-based Veja said.
Vale is the world's biggest iron-ore producer. Lula considered job cuts and trims to the company's investment plans, which were carried out by Chief Executive Officer Roger Agnelli, as unnecessary, the magazine said. Created in 1942 by the Brazilian government, Vale was privatized in 1997.
Valepar SA, the company that controls Vale, is owned by Previ, the employee pension fund of state-controlled Banco do Brasil SA; Bradespar SA, an industrial holding company; Mitsui & Co, Japan's second-largest trading company; and BNDES Participações SA.
Vale announced this week that second-quarter profits tumbled 84% versus the year earlier period as lower iron ore production and prices pushed earnings to around half of what analysts had projected.
Demand for iron ore remained weak during the quarter as the global economy struggled to recover from the 2008 financial meltdown, lumbering Vale with lower prices for its main product and fewer places to sell it.
Vale, the world's biggest iron ore producer, posted net profits of US$ 790 million compared with US$ 5.01 billion at the height of the commodities boom a year earlier, reflecting the effects of the financial crisis.
In related news, Vale reported on Friday the discovery of hydrocarbons in an exploratory block off Brazil's south-eastern coast. The hydrocarbons were located in the Vampira exploration well in the Santos Basin, Vale said.
The mining company said traces of light oil and natural gas were found in the Vampira well and that the exact volume will known after further tests. Last May the company announced the discovery of natural gas in the Panoramix well, also in the same exploratory block.
Vale has a 12.5% participation in the block's exploration consortium. Brazil's giant Petrobras has 35%, while Spain's Repsol, the block's operator, has 40% and Australia's Woodside has 12.5%.
Source: Mercopress
Allegedly Lula asked officials inside his government to find a legal way to ensure the government controls Vale through Previ and BNDES Participações SA, the investment arm of Brazil's state development bank, the São Paulo-based Veja said.
Vale is the world's biggest iron-ore producer. Lula considered job cuts and trims to the company's investment plans, which were carried out by Chief Executive Officer Roger Agnelli, as unnecessary, the magazine said. Created in 1942 by the Brazilian government, Vale was privatized in 1997.
Valepar SA, the company that controls Vale, is owned by Previ, the employee pension fund of state-controlled Banco do Brasil SA; Bradespar SA, an industrial holding company; Mitsui & Co, Japan's second-largest trading company; and BNDES Participações SA.
Vale announced this week that second-quarter profits tumbled 84% versus the year earlier period as lower iron ore production and prices pushed earnings to around half of what analysts had projected.
Demand for iron ore remained weak during the quarter as the global economy struggled to recover from the 2008 financial meltdown, lumbering Vale with lower prices for its main product and fewer places to sell it.
Vale, the world's biggest iron ore producer, posted net profits of US$ 790 million compared with US$ 5.01 billion at the height of the commodities boom a year earlier, reflecting the effects of the financial crisis.
In related news, Vale reported on Friday the discovery of hydrocarbons in an exploratory block off Brazil's south-eastern coast. The hydrocarbons were located in the Vampira exploration well in the Santos Basin, Vale said.
The mining company said traces of light oil and natural gas were found in the Vampira well and that the exact volume will known after further tests. Last May the company announced the discovery of natural gas in the Panoramix well, also in the same exploratory block.
Vale has a 12.5% participation in the block's exploration consortium. Brazil's giant Petrobras has 35%, while Spain's Repsol, the block's operator, has 40% and Australia's Woodside has 12.5%.
Source: Mercopress
Mano River Announces Billion Tonne Iron Ore Find
TSX Venture Exchange- and Aim-listed Mano River on Monday announced an initial independent mineral resource estimate of 1,08-billion tons of iron-ore at its 38,5%-owned project in Liberia.
Russian steelmaker Severstal’s mining subsidiary owns the majority stake of 61,5% in the Putu Range project, in which it had invested $30-million.
The Putu resource had potential to grow as its exploration programme advanced, Mano president and CEO Luis da Silva reported.
“We are delighted to announce this initial one-billion ton mineral resource estimate, especially as the resource covers less than one quarter of the 12 km strike length of the Putu iron-ore project in Liberia,” he said in a statement.
Da Silva said that Mano was in discussions with the Liberian government for a 25-year mining licence.
Mano and Severstal Resources are working towards a prefeasiblity study during 2010.
Source: Mining Weekly
Russian steelmaker Severstal’s mining subsidiary owns the majority stake of 61,5% in the Putu Range project, in which it had invested $30-million.
The Putu resource had potential to grow as its exploration programme advanced, Mano president and CEO Luis da Silva reported.
“We are delighted to announce this initial one-billion ton mineral resource estimate, especially as the resource covers less than one quarter of the 12 km strike length of the Putu iron-ore project in Liberia,” he said in a statement.
Da Silva said that Mano was in discussions with the Liberian government for a 25-year mining licence.
Mano and Severstal Resources are working towards a prefeasiblity study during 2010.
Source: Mining Weekly
Monday, August 3, 2009
China Looking For Unified Iron Ore Prices
China's steel industry association said on Friday that it plans this year to unify the spot and long-contract prices for the country's iron ore imports.
It will also set a ceiling for charges levied by import trading firms, as part of an effort to regulate the market.
The proposal was the top item of discussion at the steel industry body's two-day semiannual meeting, said Luo Bingsheng, deputy chairman of the China Iron and Steel Association (CISA), at a press conference.
The term prices negotiated with global miners should become a benchmark unified price, and the import agencies could charge 3-5 percent in commission on top of the term prices, Luo said.
The move aims to regulate excess iron ore import by steel makers and trading firms, which distorted the supply and demand balance and disrupted the annual contract talks, Luo said.
The price talks, which are continuing, appeared to be snagged on China's insistence upon bigger reductions than the 33 percent cut agreed to earlier with Japanese and Korean steel mills. News reports and industry analysts say China wants a 40 percent price cut.
Luo said foreign iron ore suppliers promoted massive sales on the spot market, leading to huge stockpiles.
Spot iron ore accounted for 82.7 percent of imports this year, leading to excessive imports that far exceed actual needs, the CISA said.
Luo made the remark as the spot price of iron ore in China surged above the contract prices offered by three large miners - Rio, BHP and Vale.
Benchmark spot prices of iron ore in China rose above $100 a ton on Thursday, as compared with $58 a ton in April, according to industry consultant Mysteel.
Iron ore imports rose 29.3 percent year on year, to 297 million tons, in the first half of this year, while traders imported 131 million tons, up 90.4 percent from last year.
There are 152 iron ore importers in China this year, exceeding the 112 licenses that CISA issued, the association said.
Luo said the annual talks were ongoing and CISA would keep working to push them forward.
"We are working for a reasonable result and hope to reach a win-win situation," Luo said.
"For small steel companies, a unified price system is definitely good news," said Fan Haibo, a steel analyst from Xinda Securities. "Large steel mills and trading companies have made huge profits by selling iron ore to small steel factories who do not hold import license."
"But how to define which firms have 'agent license' seems essential. Giving them the privilege is akin to guaranteeing a business always makes a profit," he said.
Source: Xinhua
It will also set a ceiling for charges levied by import trading firms, as part of an effort to regulate the market.
The proposal was the top item of discussion at the steel industry body's two-day semiannual meeting, said Luo Bingsheng, deputy chairman of the China Iron and Steel Association (CISA), at a press conference.
The term prices negotiated with global miners should become a benchmark unified price, and the import agencies could charge 3-5 percent in commission on top of the term prices, Luo said.
The move aims to regulate excess iron ore import by steel makers and trading firms, which distorted the supply and demand balance and disrupted the annual contract talks, Luo said.
The price talks, which are continuing, appeared to be snagged on China's insistence upon bigger reductions than the 33 percent cut agreed to earlier with Japanese and Korean steel mills. News reports and industry analysts say China wants a 40 percent price cut.
Luo said foreign iron ore suppliers promoted massive sales on the spot market, leading to huge stockpiles.
Spot iron ore accounted for 82.7 percent of imports this year, leading to excessive imports that far exceed actual needs, the CISA said.
Luo made the remark as the spot price of iron ore in China surged above the contract prices offered by three large miners - Rio, BHP and Vale.
Benchmark spot prices of iron ore in China rose above $100 a ton on Thursday, as compared with $58 a ton in April, according to industry consultant Mysteel.
Iron ore imports rose 29.3 percent year on year, to 297 million tons, in the first half of this year, while traders imported 131 million tons, up 90.4 percent from last year.
There are 152 iron ore importers in China this year, exceeding the 112 licenses that CISA issued, the association said.
Luo said the annual talks were ongoing and CISA would keep working to push them forward.
"We are working for a reasonable result and hope to reach a win-win situation," Luo said.
"For small steel companies, a unified price system is definitely good news," said Fan Haibo, a steel analyst from Xinda Securities. "Large steel mills and trading companies have made huge profits by selling iron ore to small steel factories who do not hold import license."
"But how to define which firms have 'agent license' seems essential. Giving them the privilege is akin to guaranteeing a business always makes a profit," he said.
Source: Xinhua
China Steel Profits May Hit $3 Billion In July
The Chinese steel industry's profit in July may have exceeded 20 billion yuan ($2.93 billion), its largest monthly gain in eight years, as domestic prices rose, the official Shanghai Securities News said on Monday, citing an official of the China Iron and Steel Association. The paper added that if steel prices remain stable, full-year profit for the industry could be 100 billion yuan, exceeding the previous year's 84.6 billion yuan.
It noted that industry website MySteel's benchmark index for domestic steel prices rose 11.9 percent in July, while the index for flat products rose 9.5 percent. Chinese steel prices have risen as government stimulus measures helped to boost the steel industry, the world's largest, back into a combined profit in May after seven consecutive monthly losses.
The industry remains locked in protracted price negotiations with global iron ore miners, however, as it seeks greater price reductions than those achieved by other steelmakers.
Source: Reuters
It noted that industry website MySteel's benchmark index for domestic steel prices rose 11.9 percent in July, while the index for flat products rose 9.5 percent. Chinese steel prices have risen as government stimulus measures helped to boost the steel industry, the world's largest, back into a combined profit in May after seven consecutive monthly losses.
The industry remains locked in protracted price negotiations with global iron ore miners, however, as it seeks greater price reductions than those achieved by other steelmakers.
Source: Reuters
Sunday, August 2, 2009
Siginficant Increase In Zambia Copper Cathode Production
Cathode copper output in Zambia, Africa's largest producer, rose to 349,333 tonnes for the six months to June this year compared to 288,057 tonnes in the same period last year, the central bank said on Saturday.
The data released by the central bank also showed that cobalt production declined to 1,690 tonnes in the first six months of the year from 2,230 tonnes.
Bank of Zambia (BoZ) governor Caleb Fundanga said copper exports in the first half of the year rose to 336,705 tonnes compared to 284,250 tonnes in the same period last year.
Cobalt exports were 1,793 tonnes compared to 2.253 tonnes last year.
"I believe that it is possible to achieve the target for 600,000 tonnes of copper by the end of the year," Fundanga told reporters.
"Even if the exports of cobalt declined, the increase in the price of cobalt compensated for that."
Zambia earns 63 percent of its total foreign exchange from copper exports and the mines are also a major employer in this southern African country of 12 million people.
The government forecasts that copper production will rise to over 600,000 tonnes this year from 569,000 tonnes the previous year.
London-listed Vedanta Resources Plc, Canada's First Quantum Minerals, Equinox Minerals Ltd and Glencore International AG are some of the foreign mining firms operating in Zambia.
SourcE: Reuters
The data released by the central bank also showed that cobalt production declined to 1,690 tonnes in the first six months of the year from 2,230 tonnes.
Bank of Zambia (BoZ) governor Caleb Fundanga said copper exports in the first half of the year rose to 336,705 tonnes compared to 284,250 tonnes in the same period last year.
Cobalt exports were 1,793 tonnes compared to 2.253 tonnes last year.
"I believe that it is possible to achieve the target for 600,000 tonnes of copper by the end of the year," Fundanga told reporters.
"Even if the exports of cobalt declined, the increase in the price of cobalt compensated for that."
Zambia earns 63 percent of its total foreign exchange from copper exports and the mines are also a major employer in this southern African country of 12 million people.
The government forecasts that copper production will rise to over 600,000 tonnes this year from 569,000 tonnes the previous year.
London-listed Vedanta Resources Plc, Canada's First Quantum Minerals, Equinox Minerals Ltd and Glencore International AG are some of the foreign mining firms operating in Zambia.
SourcE: Reuters
Saturday, August 1, 2009
Ferromanganese Plant Planned For Siberia
It is reported that a new plant for the production of manganese ferroalloys is to be constructed in the Siberian city of Krasnoyarsk, as part of the mining and smelting complex project aimed at developing the Usinsk deposit of manganese ores and the production of ferroalloys.
The project will be carried out by the Krasnoyarsk Territory Administration Council and mining and metals company CHEK SU VK in cooperation with Russian bank Vnesheconombank which will participate in funding the project.
Total investments in the project are estimated to reach about RUB 22 billion. The construction of the Krasnoyarsk plant for the production of manganese ferroalloys is scheduled to start in September this year. The plant is planned to be commissioned in 2011 and is to reach its full capacity by 2016.
Mr Viktor Khrolenko chairman of CHEK SU VK said that initially the plant is to produce about 120,000 tonnes to 140,000 tonnes of ferroalloys per year and is later to increase its annual output to 250,000 tonnes.
Currently, Russia consumes about 500,000 tonnes of manganese per year, of which about 90% is imported. The main importers of the product in question into Russia are Ukraine and Kazakhstan.
Source: Steel Guru
The project will be carried out by the Krasnoyarsk Territory Administration Council and mining and metals company CHEK SU VK in cooperation with Russian bank Vnesheconombank which will participate in funding the project.
Total investments in the project are estimated to reach about RUB 22 billion. The construction of the Krasnoyarsk plant for the production of manganese ferroalloys is scheduled to start in September this year. The plant is planned to be commissioned in 2011 and is to reach its full capacity by 2016.
Mr Viktor Khrolenko chairman of CHEK SU VK said that initially the plant is to produce about 120,000 tonnes to 140,000 tonnes of ferroalloys per year and is later to increase its annual output to 250,000 tonnes.
Currently, Russia consumes about 500,000 tonnes of manganese per year, of which about 90% is imported. The main importers of the product in question into Russia are Ukraine and Kazakhstan.
Source: Steel Guru
Pinnacle Calls Back 100 Coal Miners
Cliffs Natural Resources Inc. announced Friday that its wholly owned subsidiary, Pinnacle Mining Co., LLC, is calling back about 100 employees back to work at its Pinnacle and Green Ridge No. 1 mines. Employees are expected to return to work early in August.
The callback was prompted by a modest improvement in current orders and in the market expectations going forward. Both mines had been idled.
The Pinnacle and Green Ridge No. 1 mines are located near Pineville and produce metallurgical coal for the steel industry. Metallurgical coal demand has been reduced as the steel industry has cut back production in the face of the global economic slowdown.
In April, Cleveland-based Cliffs announced it was indefinitely idling the Green Ridge No. 1 mine, reducing operations at the Pinnacle preparation plant and halting production at the Pinnacle mine for approximately two months. The moves resulted in the layoffs of about 290 employees.
Cliffs Natural Resources is an international mining and natural resources company. It is the largest producer of iron ore pellets in North America, a major supplier of direct-shipping lump and fines iron ore out of Australia and a significant producer of metallurgical coal.
The North American business unit is composed of six iron ore mines owned or managed in Michigan, Minnesota and Eastern Canada, and two coking coal mining complexes located in West Virginia and Alabama. The Asia Pacific business unit is composed of two iron ore mining complexes in Western Australia and a 45 percent economic interest in a coking and thermal coal mine in Queensland, Australia. The South American business unit includes a 30 percent interest in the Amapá Project, an iron ore project in the state of Amapá in Brazil.
Source: Beckley Register-Herald
The callback was prompted by a modest improvement in current orders and in the market expectations going forward. Both mines had been idled.
The Pinnacle and Green Ridge No. 1 mines are located near Pineville and produce metallurgical coal for the steel industry. Metallurgical coal demand has been reduced as the steel industry has cut back production in the face of the global economic slowdown.
In April, Cleveland-based Cliffs announced it was indefinitely idling the Green Ridge No. 1 mine, reducing operations at the Pinnacle preparation plant and halting production at the Pinnacle mine for approximately two months. The moves resulted in the layoffs of about 290 employees.
Cliffs Natural Resources is an international mining and natural resources company. It is the largest producer of iron ore pellets in North America, a major supplier of direct-shipping lump and fines iron ore out of Australia and a significant producer of metallurgical coal.
The North American business unit is composed of six iron ore mines owned or managed in Michigan, Minnesota and Eastern Canada, and two coking coal mining complexes located in West Virginia and Alabama. The Asia Pacific business unit is composed of two iron ore mining complexes in Western Australia and a 45 percent economic interest in a coking and thermal coal mine in Queensland, Australia. The South American business unit includes a 30 percent interest in the Amapá Project, an iron ore project in the state of Amapá in Brazil.
Source: Beckley Register-Herald
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