Eurobench.com

voda 2 maart 2015 21:10

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Budget Update - JSW reaction

Mr Sheshagiri Rao Joint MD & Group CFO of JSW Steel has given following reaction to Union Budget 2015

A sincere attempt was made to meet the expectation of delivering a Budget for 2015-16 with growth orientation blended with fiscal prudence. It is comforting to see the print of fiscal deficit of 4.1% and 3.9% for 2014-15 and 2015-16, respectively, with a clear road map to achieve 3% over 3 years. There are several laudable initiatives: Implementation of GST by April 2016, intention to reduce corporate taxes to 25% over 4 years, deferral of GAAR by 2 years with prospective application, abolition of wealth tax, cutting subsidy leakages, measures to curb black money, etc. It will pave the way for good governance and ease of doing business. The government deserves full credit in containing fiscal deficit except the minor slip in 2015-16.

The government emphasised the importance of reviving manufacturing via ‘Make in India’. As the core sectors of economy are currently beset with challenges, participation by the private sector in fresh investments is estimated to take some time. It is expected that the government will increase the outlays in the Budget on short gestation infrastructure projects. As an incremental amount of R1,86,000 crore is to be shared with the states, out of total additional tax revenues of R1,98,000 crore, the central government’s ability to commit large outlays on the Plan expenditure is constrained.

Private sector’s participation through an appropriate PPP model is the need of the hour to create a world-class, viable and sustainable infrastructure. The Budget stated that the PPP mode of will be revisited and revitalised. The government should expeditiously take up to correct the imbalance in sharing of risks in the current PPP infrastructure model. The execution of the plug-and-play model should not be delayed and should be extended to the stalled projects.

The steel sector is competitive as reflected by ranking of six of Indian steel companies among the top 34 world-class steel companies as per the ranking of world steel dynamics. Unfortunately, this competitiveness is threatened by unrestrained dumping of steel into India. Japan, Korea, China and Russia together constitute over 75% of imports into India. Imports surged over 70% this year. It is disappointing that the government has kept effective import duty on steel products unchanged inspite of enhancing the peak rate to 15%. Hike in the peak rate will not serve any purpose if the dumping of steel is not arrested. It is also surprising that the input cost duty on metallurgical coke is increased, carbon cess on coal is doubled, railway freight is increased, without any relief to the steel sector.

Source - Strategic Research Institute

voda 2 maart 2015 21:11

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Gloom in Hebei Province of China as steel loses shine

Xinhua reported that steelmakers in north China's Hebei Province, which produces at least one fifth of the country's total crude steel, are struggling to survive through industrial reforms amid overcapacity and pollution concerns.

A slight yet nerve wracking 0.6% drop in crude steel output last year, the first drop since the year 2000, has left companies pessimistic about their destiny in the Chinese Year of the Ram, which began last Thursday.

Backed by its rich iron ore reserves, Hebei has for decades been a leading steel producer in China. Its annual output has surpassed that of Japan, the world's second largest steel producing country. Last year, crude steel output in Hebei added up to 185 million tonnes, 22% of China's total 823 million tonnes.

As demand keeps shrinking and signs of overcapacity become more apparent, the central government has decided to cut China's steel and iron production by 80 million tonnes in three years.

The decision came as a heavy blow to local steelmakers, who were already struggling with deficits and pollution accusations: of the 10 most polluted Chinese cities last year, seven were in Hebei Province.

Mr Kong Delin, a steel plant manager said that “Gone are the days when the steel mills' production lines were compared to banknote printers as steelmaking was more lucrative than any other trade.”

Mr Kong had tears in his eyes as he recalled the company's short lived glory. Jianyuan Steel and Iron Company Limited was founded in 1992 amid soaring global demand. Kong joined the company in 2002, working his way up from a young engineer to deputy general manager.

Mr Kong said that "In our heyday, the market was so hungry for steel that billets were loaded onto container trucks immediately after they came out of the furnace. People joked that steel company bosses carried huge sacks of cash to buy luxury cars, and if the sales assistant did not show due respect, they'd buy the car showroom."

The central government has demanded China's steel output be cut by 80 million tonnes by the end of 2017. Hebei, as the largest producer, should cut production by 60 million tonnes. The production cut would shake many related industries and affect the livelihoods of at least 600,000 people.

Source - Xinhua

voda 2 maart 2015 21:13

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Gogebic Tactonite dropping plans for massive iron mine

Gogebic Taconite stated that it was closing its workplace in Hurley just after concluding that the expanse of wetlands at the web site created the prospects of constructing a massive iron ore mine unfeasible.

The firm stated it would continue to investigate prospects for an iron ore mine in Ashland and Iron counties but officials stated function would be sharply curtailed.

With the exception of a single, all personnel were being furloughed. The chief engineer will continue to work on the project as an employee of Gogebic's parent, Cline Resource and Improvement.

Mr Bill Williams, president of the Gogebic Taconite said that "We are not pounding the final nail in the coffin. But we do not want to leave false hopes with people up right here."

The announcement brought a halt to a debate that lots of saw as pitting financial development against the atmosphere.

Gogebic announced plans in November 2010 for USD 1.5 billion iron ore mine. With two pits plunging as deep as 1,000 feet, the mine would sprawl more than 4 miles and operate for decades. The allure: 700 mining jobs and spinoff employment of more than 2,800, according to the company's financial estimates.

But the project ignited the biggest environmental fight in decades, with opponents expressing issues over the impact the mine would have on the Bad River watershed. The river flows north through tribal lands and empties into Lake Superior.

Mr Williams stated the forested hillside that runs along Highway 77 contained far extra wetlands than the business had anticipated. That posed major difficulties because wetlands generally need to be avoided. Crews on foot spent a lot of last summer time mapping the place of all wetlands on the house. They found far additional than the state Division of Organic Sources had listed on its maps.

He said that Gogebic officials had been satisfied with Wisconsin's regulatory oversight just after legislators passed a new mining law in March 2013 that weakened environmental protections.

Source - The Beacon Review

voda 2 maart 2015 21:13

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Russia and Ukraine add to China steel export flood

Reuters reported that steelmakers from Asia to Europe are facing increasing pressure from a rise in cheap imports as Russia and Ukraine, armed with weaker currencies, join China in pushing surplus output on to world markets.

The flood of low priced material and weak demand will keep a lid on global prices, already at their weakest level since 2009, threatening the future of producers elsewhere and raising the risk of protectionist measures.

Mr RK Goyal MD at Kalyani Steels Limited said that "We are feeling hopeless, totally hopeless. I am not sure we will be able to survive. Some of our customers are demanding a heavy reduction in prices."

According to consultancy CRU, Russia and Ukraine boosted their steel shipments abroad to 46.4 million tonnes in 2014 nearly half of the record 93.78 million tonnes of steel shipped by China, the world's top exporter.

Mr Dmitry Popov, who watches the steel sector in the Commonwealth of Independent States at CRU said that "One could legitimately ask whether Ukraine and Russia are becoming a new China in the export markets, not in terms of volume, but in terms of their impact on price."

Source - Reuters

voda 2 maart 2015 21:16

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Rio Tinto restructure to protect profits amid tight iron ore market

ABC reported that resource giant Rio Tinto will merge its copper and coal business as part of a new range of cost cutting measures.

Under the new arrangements, the miner's portfolio of assets will be condensed into four divisions aluminium, copper and coal, diamonds and minerals and iron ore. Uranium will be added to the diamonds and minerals business.

The restructure comes amid tumultuous market conditions with commodity prices under increasing pressure. The price of iron ore, Rio's biggest income earner in Australia, had more than halved over the past 12 months to a little over USD 60 per tonne.

Mr Sam Walsh CEO of Rio Tinto said that the restructure would help the miner further reduce costs and simplify the company's business structure. These changes are part of our continuing business transformation to reduce costs, simplify and strengthen our company and deliver sustainable value for shareholders. Our coal and uranium assets remain a part of our world-class portfolio. We will work hard to ensure there is a smooth transition for our colleagues in the Energy product group and continue to maximise efficiencies in our coal and uranium operations."

Source - ABC

voda 2 maart 2015 21:17

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Monument Mining delays start up of iron and copper project at Mengapur

Monument Mining Limited announced that it will delay the start up of producing iron and copper metal at the Mengapur Polymetallic Project in Pahang State, Malaysia until further notice due to depressed and volatile commodity prices. The main plant at the Mengapur site will be put on care and maintenance while some work will continue at a reduced level.

Project Progress;
The Company has been refurbishing and upgrading its 1,000 tonne per day pilot plant at Mengapur and has made considerable progress in this regard. The plant including the ball mills have been overhauled and successfully run, all lines have either been cleaned out or replaced and both mills are in satisfactory operational condition to run as a pilot operation which is the first stage of the project.

A tailings storage dam for copper and iron process tailings has been emptied, cleaned up, lined and compacted with impervious clay ready for use. A new pyrrhotite storage dam has been constructed, lined and compacted ready to store this material, a bi product from producing saleable iron.

There has been no change in the situation regarding the issue of the Star Destiny mining lease application and no communication from the Pahang State Government as to the official situation surrounding the matter has been received as previously advised to the market. The company is waiting for news from the Pahang State Government to enable it to make decisions on which way to develop the main project. In the meantime no further work can be undertaken on producing a new and compliant 43-101 or a preliminary economic assessment

Background;
When the Company acquired the project, saleable grade of Fe 62.5% iron was selling at prices far in excess of the price today. At the time the price was in the range of USD 140 per tonne or higher. Due to the recent and sustained fall in iron prices globally last year the Company changed course and commenced re-engineering its 1,000 tonnes per day pilot plant to be able to accommodate production of both iron and copper. The purpose was forward planning based on the main hard rock sulphide ore body containing both iron and copper among other metals. The hard rock ore requires a more complex flow sheet and recovery circuit than the iron contained in free digging soils some of which is overburden waste.

However, following a number of adverse events including the dramatic drop in the global iron ore price, the falling copper price, the build-up of global inventories in these two metals and general resource market price pressure together with price volatility Monument has been working to try and off-set these events. These events create great uncertainty, especially so when extensive capital investment is required to build a large mining project.

Going Forward
As a result of this interruption in the iron ore market, Monument has been focusing on copper which whilst suffering declines in market price, maintains a reasonable price and margin for many producers, we believe including Monument.

Furthermore, demand is predicted to exceed supply by 2018. Therefore the Company will maintain its SGS operated site analytical laboratory that performs 2,000 assays per month. Site security, site maintenance including maintaining all environmental obligations, mining regulatory reporting and compliance, accommodation and messing for key staff to enable them to operate site maintenance functions and allow this important work to continue as well as the laboratory continuing to turn out assays for the Selinsing exploration program, the Selinsing process plant control assays as well as provide assay and R&D support to both the Selinsing and Mengapur Research and Development laboratories.

Source - Strategic Research Institute

voda 2 maart 2015 21:17

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Grupo Simec announces operations result for 12 month 2014

Grupo Simec announced its results of operations for the twelve month period ended December 31st 2014 and December 31st 2013.

Twelve Month Period Ended December 31th 2014 compared to Twelve Month Period Ended December 31st 2013

Net Sales;
Net sales increased 11% by the combination of higher shipments of finished steel products by 6% and the average sales price per ton of 4% compared the same period of 2013, the sale rose from MXN 24,369 millions in the twelve-month period ended December 31st 2013 to MXN 26,962 millions in the same period of 2014. Shipments of finished steel products increase 6% to 2 million 197,000 tonnes in the twelve month period ended December 31st 2014 compared to 2 million 064,000 tonnes in the same period of 2013.

Total sales outside of Mexico in the twelve-month period ended December 31st 2014 increased 18% to MXN 13,400 million compared with MXN 11,347 million in the same period of 2013. Total sales in Mexico increased 4% from MXN 13,022 millions in the twelve month period ended December 31st 2013 to MXN 13,562 millions in the same period of 2014. The increase in sales is due to the increase of the average sales price of 4% and higher shipments of finished steel products by 6%.

Cost of Sales;
Cost of sales increased 12% from MXN 22,410 millions in the twelve month period ended December 31st 2013 to MXN 24,993 millions in the same period of 2014. Cost of sales as a percentage of net sales in the twelve months ended on December 31 of 2014 represented 93% and 92% in the same period of 2013. The average cost of finished steel produced in the twelve-month period ended December 31st 2014 compared to the same period of 2013 increased approximately 5% by higher costs of SBQ steel.

Gross Profit;
Gross profit of the Company in the twelve-month period ended December 31st 2014 was of MXN 1,969 million compared to MXN 1,959 millions in the same period of 2013. Gross profit as a percentage of net sales represented 7% in the twelve-month period ended December 31st 2014 and 8% in the same period of 2013. The increase in the gross profit is due to higher shipments of finished steel products in 2014, compared with the same period of 2013.

Operating Expenses;
Selling, general and administrative expenses increased 5% from MXN 1,117 millions in the twelve month period ended December 31st 2013 to MXN 1,170 million in the same period of 2014. Selling, general and administrative expenses as a percentage of net sales represented 5% during the twelve month period ended December 31st 2013 and 4% in the same period of 2014.

Other Expenses (Income) net;
The company recorded other expenses of MXN 59 millions in the twelve month period ended December 31st 2013 compared to other net income of MXN 55 millions in the same period of 2014.

Operating Income;
Operating income increased 9% from MXN 783 million for the twelve month period ended December 31st 2013 to MXN 855 millions in the same period of 2014. Operating income as a percentage of net sales was 3% in both periods.

EBITDA;
The EBITDA of the Company increased 2% from MXN 1,836 millions in the twelve month prior ended December 31st of 2013, to MXN 1,865 millions in the same period of 2014.

Comprehensive Financial Cost;
Comprehensive financial cost in the twelve-month period ended December 31st 2014 represented a net income of MXN 344 million compared with a net expense of MXN 75 millions in the same period of 2013. The net interest was zero in 2014 compared with a net interest expense of MXN 9 million in the twelve month period ended December 31st 2013. As a result, we registered a net exchange income of MXN 344 millions in the twelve month period ended December 31st 2014 compared with a net exchange loss of MXN 66 millions in the same period of 2013, reflecting a 13% increase in the value of the peso versus the dollar in the twelve month period ended December 31st 2014 compared to December 31st 2013.

Income Taxes;
The Company have recorded an expense net tax of MXN 70 millions in the twelve month period ended December 31st 2014 (including the income of deferred income tax of MXN 193 millions) compared with a net income tax of MXN 282 millions in the same period of 2013 (including the expense tax deferred of MXN 339 millions).

Net Income (loss) (After Minority Interest);
As a result of the foregoing, net income increased by 1% from MXN 1,517 millions in the twelve month period ended December 31, 2013 to a net income of MXN 1,527 millions in the same period of 2014.

Liquidity and Capital Resources;
As of December 31st 2014, Simec's total consolidated debt consisted of USD 302,000 of 8 7/8% medium term notes due 1998, MXN 4.5 million (accrued interest on December 31st 2014 was USD 555,585 or MXN 6.9 millions). As of December 31st 2013, Simec's total consolidated debt consisted of USD 302,000 of 8 7/8% medium term notes due 1998, MXP 3.9 million (accrued interest on December 31st 2013 was USD 527,048, or MXN 6.9 millions).

Source - Strategic Research Institute

voda 2 maart 2015 21:20

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Gaat lekker zo, met die nieuwe 120MB verbinding! :-)

voda 2 maart 2015 21:20

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Vale iron ore production overview for 2014

Vale’s own iron ore production, excluding iron ore acquired from third parties and Samarco’s attributable production, reached the record of 319.2 MT in 2014, 19.4 MT higher than in 2013 and 7.2 MT higher than our guidance for 2014.

In 2014, Carajas achieved the production record of 119.7 MT, representing an increase of 14.8 MT in relation to 2013. The Southern System produced 86.3 MT in 2014 and achieved its best annual mark since 2007. This 2014 production represents an increase of over 9% against the 79.0 MT produced in 2013.

On a quarterly basis, Vale’s iron ore production ex Samarco's attributable production was 83.0 MT in Q4 2014, a new record for Q4. Carajas achieved a new historical record with an output of 34.9 MT in Q4 2014, 8.4% and 10.4% higher than in Q3 2014 and in Q4 2013, respectively.

In Q4 2014, Vale transported 32.9 MT in its Estrada de Ferro Carajas (EFC), a new quarterly record, 2.1 MT higher than in Q4 2013 and its shipments reached 32.8 MT also a new quarterly record, 1.5 MT higher than in Q4 2013.

Northern System;
This production of 34.9 MT in Carajas is a result of the ramp ups of Plant 2 and Serra Leste in Q4 2014. Plant 2 produced 4.9 MT in the quarter, 0.6 MT more than in 3Q14.

Southeastern System;
The Southeastern System, which encompasses the Itabira, Minas Centrais and Mariana mining hubs, produced 26.4 MT in Q4 2014, 7.9% lower than in Q3 2014. Despite the good production in Conceicao Itabiritos, the Minas Centrais mining hub experienced scheduled maintenance stoppages in Q4 2014. Production in the Itabira mining hub was 0.5% higher than in Q3 2014 due to the ramp up of CI. Output of CI was 2.3 MT, 0.5 MT higher than in Q3 2014.

Production in the Minas Centrais mining hub was 7.2 MT in Q4 2014, 19.5% and 20.9% lower than in Q3 2014 and Q4 2913, respectively, as a result of the scheduled maintenance stoppage for the implementation of Brucutu's 5th production line which will allow the plant's production to increase by 30% in 2015. Output in the Mariana mining hub reached 9.6 MT, 5.5% lower than in Q3 2014, as a result of the mining plan for the year.

Southern System;
The Southern System, composed of the Paraopeba, Vargem Grande and Minas Itabirito mining hubs, produced 20.1 MT in Q4 2014, 13.4% lower than in Q3 2014 due to maintenance stoppage in some units.

Production at the Paraopeba mining hub was 17.3% lower than in Q3 2014 mainly due to corrective maintenance in the crushing system. Production at the Vargem Grande mining hub was 8.8% lower than in Q3 2014 due to a corrective maintenance in the conveyor belt. Production at the Minas Itabirito mining hub was 13.6% lower than in Q3 2014, mainly due to the preventive maintenance in the crushing system.

Midwestern System;
The Midwestern System, comprising the Urucum and Corumba mining hubs, produced 1.5 MT in Q4 2014, 0.1 MT and 0.2 MT lower than in Q3 2014 and in Q4 2013, respectively, due to the beginning of the rainy season. As previously disclosed, production in the Midwestern system was reduced in 2014 for an adjustment in inventory levels. Therefore production was slightly lower than in 2013 without any impact on sales.

Samarco;
In Q4 2014 Samarco's pellet feed production (dedicated to pellet production) was 3.8 MT, 1.6% higher than in Q3 2014.

Source - Strategic Research Institute

voda 2 maart 2015 21:22

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Company wanting to open iron ore mine in Northern Wis to close office

saying future investment was unfeasible at this time a move that marks the end for now of the project near Lake Superior that sparked fierce debate and opposition from environmentalists and tribal members near the site.

Mr Bill Williams, president of mining company Gogebic Taconite, released a statement announcing the decision. It comes after field explorations were put on hold due to mounting obstacles and years of opposition from environmentalists and local tribal members.

Mr Williams said that the Florida based company will continue to investigate the possibility of pursuing a permit to mine but can't justify having an office in Hurley without the prospect of immediate action. Our extensive environmental investigation and analysis of the site has revealed wetland issues that make major continued investment unfeasible at this time.

He also cited uncertainty over whether the 1,000 foot deep mine would run into trouble with the US Environmental Protection Agency, which last summer restricted plans for a gold and copper mine in Alaska under the Clean Water Act.

Ms Laurel Patrick a spokeswoman for Governor Mr Scott Walker said that "We remain committed to working with companies interested in creating quality, family supporting jobs in Wisconsin.

State Sen. Tom Tiffany, a Hazelhurst Republican who championed the project, said the office's closing would not prevent the mining project from moving forward.

He said that "I believe this ore body is going to be mined at some point, whether by Gogebic Taconite or someone else. But as long as we have a federal government that is so hostile toward (these projects) it will be hard to get the permit to do it."

Source - www.wisn.com

voda 2 maart 2015 21:23

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Chinese steel mill shares out dazzle rivals in 2014

Reuters reported that shares in China's steel markers outshone long time international rivals in 2014 as Chinese mills overwhelmed buyers with cheap prices. But investors are starting to look elsewhere now, particularly as Russian rivals come to the fore.

Shares of Hebei Iron and Steel, the listed unit of top Chinese producer Hebei Steel Group, soared more than 90 percent last year. Baoshan Iron and Steel climbed over 70% while Wuhan Iron and Steel gained 63%.

In contrast, the world's No.1 ArcelorMittal slid 30%. Shares of some South Korean and Indian steel firms also declined.

While those gains mirrored the broader rally in Chinese equities, investors couldn't ignore China's steel exports, which rose to a record last year. Last month, steel shipments hit a historic high, despite the removal of export tax rebates on products alloyed with boron, which makes them tougher.

Faced with a weakening domestic market, Chinese steelmakers have no choice but to push more products overseas. They have so far outwitted global competitors with low prices. They are also finding substitutes for boron to continue enjoying rebates on alloy steel. But cheap prices have come at the expense of margins and shares have come off their 2014 peaks. Environmental compliance costs have risen as the government cracks the whip on polluting industries.

In particular, the weaker rouble means Russian rivals will be more of a challenge to Chinese exporters in the months ahead. Indeed, shares of Russian producers have already ticked higher. Severstal jumped 57 percent last year and has added a further 36% so far in 2015. Evraz is up 25% after gaining 43% in 2014. Top Russian steelmaker NLMK is 22% higher after rallying 21% last year.

Mr Jeremy Platt, analyst at UK steel consultancy MEPS said that "Clearly there is demand for cheap steel and steel buyers around the world are benefiting. China is likely to continue to remain the most price competitive exporter but margins will be tight.”

Source - Reuters

viermeiden 2 maart 2015 21:25

0

L.s.,

CONTRECOEUR (AFN) - Staalconcern ArcelorMittal concentreert zijn recyclingactiviteiten in Canada bij zijn vestiging in de stad Contrecoeur. Vergelijkbare fabrieken in Ottawa en La Prairie worden verkocht aan American Iron & Metal Company.

Dat maakte ArcelorMittal maandag bekend. Financiële details over de verkoop werden niet vermeld.

viermeiden

gpjf 2 maart 2015 22:49

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Gaat nou de vlag uit ?

voda 2 maart 2015 22:55

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quote:
gpjf schreef op 2 maart 2015 22:49:
Gaat nou de vlag uit ?

Ja, de vlag voor Voda, die hier weer de eerste mee was, en ontiegelijk veel, heel veel ander staal nieuws!

voda 3 maart 2015 16:19

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Glencore kampt met prijsdaling grondstoffen

DINSDAG 3 MAART 2015, 09:46 uur | 207 keer gelezen

BAAR (AFN/BLOOMBERG) - Grondstoffenproducent en -handelaar Glencore kampt met de forse daling van grondstoffenprijzen. Dat bleek dinsdag uit de jaarcijfers van het concern. De nettowinst van het Brits-Zwitserse bedrijf daalde in 2014 met 7 procent ten opzichte van een jaar eerder.

Het resultaat kwam uit op 4,3 miljard dollar (3,8 miljard euro) op een omzet van 221 miljard dollar. Dat was meer dan waar analisten op rekenden. Met de winstdaling houdt Glencore gelijke tred met branchegenoten als Rio Tinto en BHP Billiton die om soortgelijke redenen hun resultaten zagen afnemen.

Eerder meldde Glencore dat het gaat snijden in zijn investeringen, als gevolg van de dalende prijzen en onzekere marktomstandigheden. Afgelopen jaar schreef de onderneming 1,1 miljard dollar af op zijn bezittingen.

voda 3 maart 2015 16:28

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Budget Update - Unchanged steel import duty unfortunate - JSW

Mr Seshagiri Rao Joint MD & Group CFO of JSW Steel wrote for Business Standard that “A sincere attempt was made to meet the expectation of delivering a Budget for 2015-16 with growth orientation blended with fiscal prudence. It is comforting to see the print of fiscal deficit of 4.1% and 3.9% for 2014-15 and 2015-16, respectively, with a clear road map to achieve 3% over 3 years. There are several laudable initiatives: Implementation of GST by April 2016, intention to reduce corporate taxes to 25% over 4 years, deferral of GAAR by 2 years with prospective application, abolition of wealth tax, cutting subsidy leakages, measures to curb black money, etc. It will pave the way for good governance and ease of doing business. The government deserves full credit in containing fiscal deficit except the minor slip in 2015-16.”

He said “The government emphasised the importance of reviving manufacturing via ‘Make in India’. As the core sectors of economy are currently beset with challenges, participation by the private sector in fresh investments is estimated to take some time. It is expected that the government will increase the outlays in the Budget on short gestation infrastructure projects. As an incremental amount of INR 1,86,000 crore is to be shared with the states, out of total additional tax revenues of INR 1,98,000 crore, the central government’s ability to commit large outlays on the Plan expenditure is constrained.”

He added “Private sector’s participation through an appropriate PPP model is the need of the hour to create a world-class, viable and sustainable infrastructure. The Budget stated that the PPP mode of will be revisited and revitalised. The government should expeditiously take up to correct the imbalance in sharing of risks in the current PPP infrastructure model. The execution of the plug-and-play model should not be delayed and should be extended to the stalled projects.”

He also said “The steel sector is competitive as reflected by ranking of six of Indian steel companies among the top 34 world-class steel companies as per the ranking of world steel dynamics. Unfortunately, this competitiveness is threatened by unrestrained dumping of steel into India. Japan, Korea, China and Russia together constitute over 75% of imports into India. Imports surged over 70% this year. It is disappointing that the government has kept effective import duty on steel products unchanged inspite of enhancing the peak rate to 15%. Hike in the peak rate will not serve any purpose if the dumping of steel is not arrested. It is also surprising that the input cost duty on metallurgical coke is increased, carbon cess on coal is doubled, railway freight is increased, without any relief to the steel sector.”

Source – Business Standard

voda 3 maart 2015 16:30

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India's auto makers optimistic on demand growth

Business Standard reported that despite getting no respite on excise duty, something automobile companies were keenly longing for from the finance minister, the Indian auto industry is confident of a demand upswing in the coming financial year.

Top executives of vehicle manufacturing companies said that factors such as lower interest rates, lower fuel prices, general pick-up in economic activities, no increase in vehicle prices and continued new model launches will help pull customers back into showrooms.

Mr Pawan Goenka, executive director, Mahindra & Mahindra, said that "It’s not an accident that the economy is looking up. Demand growth does not have to wait till the rollout of GST (the national goods and services tax). I am very optimistic that demand will start coming back in April-May. There are positive factors such as interest rates coming down by another 50 basis points in four to 6 months because inflation is under control. As commodity prices are benign, the increase in vehicle prices will be much below inflation. There is expectation that the economy will grow by 8% to 8.5% and there is clearly a infrastructure boost. So, all the factors for driving demand are in place."

Mr Vinod K Dasari MD of Ashok Leyland said that "While there has been no excise duty modification in the automotive sector, I believe long-term demand creation is more sustainable than short-term sops to boost consumption. The government has moved in exactly this direction with this Budget."

Mr Guillaume Sicard, president, Nissan India Operations, said that "The industry would have benefited a lot had the excise duty benefits been extended but this Budget has the potential to raise the consumer sentiment, which will help the industry grow."

The Society of Indian Automobile Manufacturers said that “The Budget lays huge emphasis on development of the infrastructure through the country and shall boost the prospects of a wide range of industries, including the automobile, particularly commercial vehicles, industry. A strong focus on rural development including substantial allocation under MGNREGS (the rural jobs guarantee) would also ensure improved demand from the non-urban centers, which benefit the auto industry.”

With the end of December, the period for concession on excise duties also ended. Duties were raised by four to 6%. The minimum excise duty on cars is now 12.5%, as against eight% until December. Sports utility vehicles remain the most taxed category, with a 30% duty.

Source – Business Standard

voda 3 maart 2015 16:44

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China orders two local governments to punish polluting steel mills

Reuters reported that China's environmental ministry has ordered local governments in two key steel producing cities to take tougher action against polluters from the sector as part of efforts to improve air quality. That could pile pressure on mills already struggling with weak demand growth as the world's No.2 economy loses momentum.

Inspectors from China's Ministry of Environmental Protection last week summoned mayors from the cities of Linyi in the eastern province of Shandong and Chengde in the northern province of Hebei, urging them to crack down on firms that have violated environment laws.

Mr Gao Zhenning official of MEP said that "We have to fully implement the law to shut down those enterprises which haven't taken any environmental protection measures and haven't run environment protection equipment."

Thirteen of the 15 enterprises inspected in Linyi had violated environmental laws. Most were steel and coke plants with some found to have provided fake environmental data.

Beijing is determined to tackle hazardous smog by imposing higher environmental standards and strengthening monitoring in high polluting regions, with some unqualified steel mills closed permanently since last year.

China put a new environment law into effect at the start of 2015 and can now impose unlimited fines and even prison sentences on officials who fail to conform with new standards.

The MEP has already used its strengthened powers to take on local governments in Hebei and elsewhere, summoning local leaders to explain themselves when they failed to comply with emergency pollution guidelines during a major international summit in Beijing in November.

Chinese steel mills, already suffering from persistently low prices as a result of overcapacity and an economic slowdown, are now paying an estimated CNY 160 per tonne of steel to comply with environmental guidelines.

Source - Reuters

voda 3 maart 2015 16:46

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POSCO pushes for asset sale to improve financial soundness

Yonhap reported that POSCO, South Korea's leading steelmaker, is accelerating its push to sell unnecessary assets as part of its efforts to focus more on its key business and strengthen its financial soundness.

Industry sources said that POSCO sold KRW 28 billion worth of real estate last year, including buildings and land in Pohang, its main base on the southeast coast and Gwangyang on the south coast. The sale was decided as the assets were regarded as idling or unnecessary to hold onto in carrying out its core business.

With the sale, POSCO will be able to reduce taxes and maintenance costs by about KRW 1.9 billion annually. Such efforts will likely accelerate going forward, with POSCO seeking to unload KRW 47 billion worth of real estate this year.

In a related move, the company is reportedly in talks with retail giant Lotte Shopping to sell a building and a land site in Pohang where Lotte Mart is operating for about KRW 18 billion.

A company official said that we will keep selling real estate that has no direct bearing on our core steelmaking business to improve financial status and enhance the overall efficiency in asset management.

POSCO also is pushing to complete the sale process for its subsidiaries, including POSCO Specialty Steel for which the company already signed a deal late last year to sell its shareholdings to SeAH Besteel Corporation for KRW 1.1 trillion.

In October, the steelmaker tapped Hahn & Company, a private equity group, as the primary negotiation partner for the sale of POSFINE, a company that sells ground blast furnace slags to cement makers.

The asset sale effort is in line with the business plan unveiled earlier last month during an investor relations meeting, in which POSCO promised to cut back on investment and sell assets deemed to be non core.

Mr Kwon Oh joon CEO of POSCO said that the company will strengthen its financial soundness by securing some 1 trillion won this year through planned corporate restructuring, such as an affiliate sale.

Source - Yonhap

voda 3 maart 2015 16:47

0

China's iron ore imports from Australia rises in January

Reuters reported that China’s iron ore imports from Australia jumped 10% to 49.95 million tonnes in January as major miners expanded production to gain market share despite an economic slowdown in the world’s top consumer.

But overall imports dropped 9.3% to 78.62 million tonnes in January from a year ago, however, Australian miners managed to increase their market share of the total to 63.5% from 58.8% last year.

Customs data showed that shipments from Brazil, the second largest supplier to China, dipped 3.9% to 14.93 million tonnes in January and South Africa, the third largest supplier, tumbled 27.7% to 3.33 million tonnes.

The world’s big three iron ore miners Rio Tinto, BHP Billiton and Vale have proceeded with expansion plan to help push prices lower and drive more high cost rivals out of business.

The survival of the fittest strategy, outlined by Mr Sam Walsh CEO of Rio tinto is expected to see imports from Australia and Brazil take more than 80% of the Chinese market in 2015, from 64% four years earlier.

Source - Reuters

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