BT Steel Strips Blog

China’s Baoshan Iron and Steel has cut its fourth-quarter sales prices for cold-rolled steel products, the first cut in a year, as the demand outlook weakens in China’s auto and home appliance sectors.

Baosteel, the listed unit of China’s largest steel mill, lowered cold-rolled steel product prices by 300 yuan from the third quarter, while keeping its hot-rolled steel product prices unchanged, trade sources said on Monday.

An official in the office of Baosteel’s board had no comment, while a senior Baosteel official told Reuters on Friday that the company may not publish uniform steel product prices for the fourth quarter. The company did not announce prices for the third quarter.
Source: http://www.reuters.com/article/rbssIndustryMaterialsUtilitiesNews/idUSSHA36534220080825
The decision to keep hot-rolled prices unchanged reflected high global steel prices relative to China’s and expectations of firm demand worldwide in the fourth quarter, analysts said.

“Baosteel’s pricing is within the market’s expectations. We have already seen weak demand for cold-rolled coil due to a slowdown in the auto and home appliance industries,” one trader said.

The price for cold-rolled steel, excluding value-added tax, is 6,496 yuan ($949.30) per tonne for September, while the price for hot-rolled steel is 5,742 yuan, traders said, citing offers from the company.

Indian mild steel ingot futures on the National Commodity and Derivatives Exchange are likely to trade sideways with a positive bias this week after markets fell nearly 10 percent last week, analysts said.

But most analysts have suggested selling at current levels on expectations steel companies would refrain from raising prices and curtail exports to boost supplies in the local market.

“The government does not directly control steel prices but it looks like it has managed to convince steel makers not to raise prices this month,” an analyst in Motilal Oswal Commodities Broker Pvt Ltd, said.

Prices may edge up a little this week but in the medium term the market looks bearish and anyone holding long position may exit at current levels, Prakash Prabhu, Ventura Commodities Pvt Ltd, said. On July 31, India’s steel minister Ram Vilas Paswan said he had asked steelmakers not to increase steel prices in the ‘national interest’.

India is battling 13-year high inflation and steel prices are a major contributor.

Steel firms were expected to raise prices when a three-month moratorium on price increases ended last week, but chose to hold price, the steel secretary said last week.

There can be minor rise in prices but in the medium term the market should ease, the Bonanza Commodity analyst said.

Mild steel ingot futures <0#NST:> on NCDEX is the most traded product in the ferrous metal category in India.

Official data showed India’s steel consumption rose 10.7 percent in 20O7/08, while output growth was slower at 5.1 percent and the gap was met through 7.18 million tonnes of imports
Source:http://in.reuters.com

Bhilai Steel Plant, the most profitable unit of the Steel Authority of India Ltd, faces a tense fortnight before it will know whether it can dig for iron ore at Rowghat, its only chance of survival even as it plans to expand steelmaking capacity to 7.5 million tonne a year from 4.2m tonne at present.

With the Supreme Court clearing the mining plans of Posco and Sterlite last Friday, following the green signal of a central empowered committee handling such cases, it is now Bhilai Steel’s turn at Friday hearings. This Friday being a holiday, Bhilai’s case is expected to be heard on August 22. Raghavachari Ramaraju, managing director of the Chhattisgarh-based plant, said he is hopeful about Rowghat. The plant’s current mines at Dalli Rajhara, 85km away, will be exhausted in four or five years.

“We expect that, with Posco’s and Sterlite’s case having been cleared by the Supreme Court…Ours will be coming up next and get the clearance,” said Ramaraju, who has been with Bhilai since joining it in 1972 as a graduate engineer. Rowghat, 180 km from Bhilai, has around 500 million tonne iron ore, which will last the plant 35-40 years at its expanded capacity.

“Dalli Rajhara is depleting fast and we are trying to stretch it to the maximum, but it won’t last us more than another four and a half years maximum,” he said. Bhilai Steel was set up in the middle of nowhere only because of the iron ore reserves, and its location makes imports or even supplies from other SAIL mines uneconomical. It gets Dalli Rajhara ore at Rs 600-650 per tonne, and imports will cost ten times more. “We can’t afford to buy from anywhere else, and at the same time there is no source which can give me the ore,” he said, pointing out that the NMDC Ltd mines nearby are fully booked. “That is precisely the point we are stressing, that an established unit will not have any linkages,” he said. He said, SAIL’s own raw materials division is already finding it difficult to feed the existing plants.

Bhilai is the only SAIL plant that has its own iron ore mines, apart from ISP, the recently acquired Indian Iron & Steel Plant.

source:http://us.rd.yahoo.com/dailynews

Indian steel firms may seek to raise prices when a self-imposed moratorium ends early next month, but the government is likely to oppose any hefty, inflation-fuelling increase.

Tata Steel’s Managing Director B. Muthuraman said on Wednesday Indian steel prices were ruling 15,000-20,000 rupees ($350-$450) a tonne below global rates at a time when rising input costs and freight rates were denting firms’ margins.

“There is every justification for increasing prices because input prices have gone up,” Muthuraman told reporters at an industry conference. He added the steel industry found itself in an “unnatural situation” which could hurt expansion plans.

In May, steel companies such as state-run Steel Authority of India (SAIL.BO: Quote, Profile, Research), Tata Steel (TISC.BO: Quote, Profile, Research), JSW Steel (JSTL.BO: Quote, Profile, Research) and others promised to hold prices for three months to help the government cool prices amid fast-rising inflation.

SAIL will review prices after the three-month period expires, its chairman, S.K. Roongta, said on Wednesday.

Despite the price pledge by larger steel firms, data from an official body, the Joint Plant Committee, showed many product prices had risen by about 9 percent since mid-May.

Steel Minister Ram Vilas Paswan said smaller firms and middle men were to blame. “We won’t want steel producers to face losses because the steel industry is at its peak, but we will also safeguard consumer interest,” Paswan told reporters, calling on firms to increase production.

He added that if firms hike prices in the near term, the government would be watching.

“If the media asks me why steel firms have increased prices, I will say raw material prices have gone up.

“But if they again ask me why steel firms have raised prices by 5 percent when (input) costs have gone up by just 2 percent, then you will have to answer,” the minister said, pointing towards steel industry representives.

R.S. Pandey, the top official in the steel ministry, said the government would consider taking steps to cool steel prices as long as they were contributing to high inflation.

Shares in Tata Steel reversed early gains to close 3.3 percent down at 625.70 rupees, while SAIL lost 3.9 percent to 127.20 rupees in a Mumbai market that ended down 0.8 percent.

SOURCE: http://in.reuters.com/article/domesticNews/idINBOM33232320080716?rpc=401&&pageNumber=2&virtualBrandChannel=0

Indian steel firms have agreed to hold prices at current levels, Steel Secretary Pramod Rastogi told a business conference on Friday, giving a boost to government efforts to curb inflation at a 13-year high.

Firms in the world’s fifth-largest steel producing nation have been battling soaring costs of key inputs like iron ore and coal, but have been holding prices since May to help rein in double-digit inflation, which crossed 12 percent in late July.

“The government had initiated a number of fiscal measures to check prices and steel companies had agreed to hold prices and restrain exports. They have now agreed to hold prices further,” Rastogi said.

Officials of Tata Steel Ltd (TISC.BO: Quote, Profile, Research, Stock Buzz), state-run Steel Authority of India Ltd (SAIL.BO: Quote, Profile, Research, Stock Buzz), JSW Steel Ltd (JSTL.BO: Quote, Profile, Research, Stock Buzz) and Ispat Industries Ltd (ISPT.BO: Quote, Profile, Research, Stock Buzz) said on Thursday they would hold prices in August, even as the self-imposed moratorium ended.

But some company officials said they would review the situation next month. (Reporting by Devidutta Tripathy and Mayank Bhardwaj, Editing by Mark Williams)

Source: http://www.reuters.com/article/rbssIndustryMaterialsUtilitiesNews/idUSDEL4262020080808

Hardening and Tempering is a thermal process that strengthens steel through a controlled heating and cooling process.

This process will result in improved mechanical properties and give a tougher more durable product. The hardening process involves heating the steel to above the critical temperature for the given grade and then rapidly cooling. Whilst this process achieves the highest mechanical stengths and hardness’s, steel in this condition is extremely brittle and therefore requires further treatment in the form of tempering. This consists of reheating the steel to a lower temperature and holding the steel at the given temperature for a given period of time. As with traditional annealing (used to soften steels) this process is conducted in an inert atmosphere to avoid oxidation.

The exact temperature and processing times vary with given grades of steel and the process is very specialized.

The Indian government has urged the domestic steel industry not to hike prices even after the expiry of agreed three-month freeze.

The country’s steel minister Ram Vilas Paswan has asked India’s second-largest steelmaker, Steel Authority of India Ltd. (SAIL), not to hike prices in view of the exceptional situation, and said he would like the industry to cooperate as well.

The minister also said that the government wants the steel industry to prosper and is giving facilities directly and indirectly to favourably impact the cost.

Global companies have been raising steel prices, which have nearly doubled this year, amid bullish demand for the metal.

According to media reports, the Indian government is planning a price band for steel products in order to check rising inflation due to high energy and commodity prices.

Indian steel producers may not be able to expand production capacity to meet burgeoning demand if their operating margins remain at current levels, Tata Steel’s managing director B Muthuraman said on Wednesday.

“Our margins are not good,” he said, even as steel secretary R S Pandey noted that profit margins for some producers were as high as 20% in June.

Refusing to name any company, Pandey said, “The range of profit margins is as wide as 15-45% for different companies.” But Muthuraman maintained that steel prices in India were Rs 15,000-20,000 lower than international prices despite rising input costs. “I have seen consumer prices rising disproportionately to steel prices,” he said, adding that the benefits of low steel prices here hadn’t reached end users.

Steel minister Ram Vilas Paswan said that profits of domestic steel producers have risen despite hike in raw material costs. He said steel price hike has been higher than rise in cost of production.

“If I tell mediapersons that steel prices have risen because of higher input costs, they will ask me why this hike is higher than that in input costs,” Paswan said. He urged steel producers to monitor the prices themselves.
Source: http://www.dnaindia.com/report.asp?newsid=1178008

The steel industry could be in for another shock with the government now considering banning exports of flat steel products with a view to check rising inflation.
“If the prices of flat steel products are not being kept in check, either the export duty could be increased or a ban on exports could be considered to increase domestic availability,” Committee of Secretaries (CoS) observed in its last meeting.
It also noted that the government may consider increasing export duty on long steel products and subsequently explore the possibility of banning iron ore exports to increase domestic availability.
Government had on 13 June exempted flat rolled products of iron and steel, including galvanized products, pipes and tubes that attracted export duty ranging from 5% to 15% ad-valorem, from the purview of the export duty.
The rate of export duty on long products such as bars and rods, angles, shapes, sections and wires was also increased from 10% to 15% and a 15% ad-valorem duty was imposed on iron ore.
The CoS decided that the Ministry of Steel in consultation with Department of Revenue would soon consider suitable measures for increasing the domestic availability of steel and moderating its prices.
The ministry would also consider proposals for implementation in early August when the three-month self- moratorium imposed by major steel producers to hold their priceline expires.
The ministry would quickly undertake an analysis on the options available for moderating the prices of iron ore and submit it for consideration of the company of secretaries during the next meeting, they added.
Source:http://www.livemint.com/2008/07/17153116/Govt-may-ban-export-of-flat-st.html?h=B

Corus Process Engineering has been awarded a multi million pound contract from Rashtriya Ispat Nigam Limited’s Visakhapatnam Steel Plant to modify and enhance the company’s number 2, four strand bloom caster at its plant.

As a turnkey contract, Corus Process Engineering’s responsibilities include the complete design, equipment supply, installation and commissioning of the modified bloom caster.

Corus Process Engineering will lead the project, with its consortium partner TATA Projects, handling some of the design, indigenous equipment sourcing and installation work.

Mr Brian Stalker international sales manager for Corus Process Engineering said that “The contract suits Corus Process Engineering’s skill sets entirely and includes supply of new moulds and top zones, mould oscillators and mould table, Tundish car frames, modified strand guide segments and enhanced secondary cooling spray systems. Corus Process Engineering is also responsible for replacing the process control and an automation system associated with the caster, as well as electrical works, including new electric motors and cabling.”

The number 2 bloom caster is one of six identical casters at RINL’s steel plant, which all share a common casting floor.

Source: www.steelguru.com