1. business and industrial
2. energy
3. coal

Fr i d ay 1 0 , O c to b e r 2 0 1 4
News &
Report Analysis
Currency Market
Precious Metal
Base Metal
Energy Market
 Diamond hub planned in Mumbai to rival
Antwerp, Dubai
 Domestic steel makers scouting for
Chinese technology
 JSW’s proposal to buy Welspun Maxsteel
gets CCI nod
 JSPL to fully acquire JB Fabinfra
 RSP crude steel output up 23%
2
Friday 10, October 2014
Daily
MMR Landed Prices
London Metal Exchange : Thursday 09, October 2014
Pr. Sell
(1)
Morning Session
Buy
Sell * (2)
Afternoon Session
Buy
Sell
Kerb
Change
(2) - (1)
Value
Stk(tns)
change
$/ton
Rs/ton
Copper Grade A
Spot
6755.00
6766.50
6767.00
6792.00
6792.50
6777.00
12.0
1,49,900
MMR LP
4,46,371
3-mth
6706.00
6712.00
6712.50
6737.00
6738.00
6720.00
6.5
275
14-D MA
4,47,216
PP (HCL)
4,56,624
Average
10-days - 6730.60
20-days - 6787.50
30-days - 6841.60
Tin High Grade
Spot
20220.00
20200.00
20225.00
20239.00
20240.00
20159.00
5.0
9,225
--
--
3-mth
20300.00
20175.00
20180.00
20274.00
20275.00
20200.00
-120.0
95
--
--
--
--
Average
10-days - 20352
20-days - 20736
30-days - 20959.80
Lead
Spot
2095.00
2081.00
2082.00
2089.00
2090.00
2077.00
-13.0
2,25,200
MMR LP
1,42,048
3-mth
2102.00
2093.50
2095.50
2100.00
2101.00
2088.00
-6.5
-25
14-D MA
1,42,933
PP (HZL)
1,52,900
Average
10-days - 2080.10
20-days - 2080.20
30-days - 2117.80
Zinc Special High Grade
Spot
2332.00
2327.50
2328.00
2335.00
2336.00
2327.75
-4.0
7,34,525
MMR LP
1,63,044
3-mth
2340.50
2338.00
2339.00
2343.00
2344.00
2336.00
-1.5
-2825
14-D MA
1,61,296
PP (HZL)
1,71,300
Average
10-days - 2283.20
20-days - 2266.30
30-days - 2294.90
Aluminium
Spot
1920.50
1923.00
1924.00
1928.00
1928.50
1920.00
3.5
45,63,875
MMR LP
1,47,973
3-mth
1950.50
1955.00
1956.00
1958.00
1959.00
1950.00
5.5
-7500
14-D MA
1,47,811
PP (Nalco)
1,59,900
Average
10-days - 1905.30
20-days - 1928.50
30-days - 1974.30
Aluminium Alloy
Spot
2075.00
2105.00
2115.00
2114.00
2115.00
2108.00
40.0
27800
3-mth
2090.00
2120.00
2130.00
2129.00
2130.00
2125.00
40.0
0
Average
10-days - 2085
20-days - 2087.50
30-days - 2098.80
Nickel
Spot
16700.00
16625.00
16630.00
16724.00
16725.00
16602.00
-70.0
3,65,148
--
--
3-mth
16755.00
16700.00
16710.00
16800.00
16800.00
16675.00
-45.0
618
--
--
-Copper
Aluminium
-01-Oct
19-Sep
Zinc
Lead
06-Oct
06-Oct
Average
10-days - 16503.50
20-days - 17086
30-days - 17698
Note: 1. MMR LP = MMR Landed Prices, excluding excise duty. 2. PP = Producer Prices ex-smelter, excl. excise
Minor Metals ($/LB)
Antimony
99.65%
9,600
Cadmium
99.80%
90.00
Cobalt HG Moly.oxide
99.80%
14.00
14.25
Tantalite
30% Ta2O5
92.00
Titanium Ferro-vana
Con. Ti02
650.00
24.90
Silicon
2,050
Week ended Avg of Steel Prices: 04/10/2014 (Incl. Excise duty)
Sponge Iron
Pig Iron
Mandi
29,200 HMS
33,700 CRP(LSLP)
Mumbai
29,800
32,900
Kolkata
29,600
-
Indicative Domestic Market Rates (Rs./kg)
Mumbai
09-Oct
Chennai
29,400
31,800
MS Ingots
Bhiwandi
38,500
Comex Copper (cents/lb)
Prev
Delhi
09-Oct
Prev
-509.0
-512.0
444.0
-
445.0
-
Alum Ingot
Zinc Slab
Lead Ingot
Tin Slab
Nickel (4x4)
Scrap
Copper Heavy
Copper Uten.
169.0
187.0
137.0
1,510.0
1,155.0
169.0
187.0
138.0
1,510.0
1,160.0
170.0
200.0
133.0
1,503.0
1,145.0
170.0
200.0
132.0
1,505.0
1,160.0
474.0
434.0
476.0
435.0
---
---
Copper Mixed
Brass Utensil
Brass Huny
Brass Sheet
Alum Utensil
-328.0
-340.0
134.0
-328.0
-343.0
135.0
434.0
-324.0
141.0
435.0
-328.0
141.0
Virgin Metals
Copper Pat
Copper W/Bar
Delhi
29,500
-
Jul'14
Aug'14
Sep'14
Rate
302.80
302.90
303.00
Change
0.9
0.9
0.9
Kanpur
38,200
Durgapur
34,500
Comex Al (cents/lb)
Rate
-
Change
-
Precious Metals : Indicative Rates
Metal
Gold Std
Silver
Gold
Silver
Gold
Silver
Market
Mumbai
Mumbai
London
London
Comex
Comex
Unit
Rs./10g
Rs./kg
$/tr.oz.
$/tr.oz.
$/tr.oz.
$/tr.oz.
09-Oct
27,250
39,300
1,226.8
17.64
1,224.6
17.36
Prev
27,300
39,500
1,217.0
17.35
1,205.3
17.01
Forex: Oct 09, 2014 (Rs/Unit Currency)
Buy
USD
61.08
61.00
EURO
77.99
GBP
99.06
98.93
SGD
48.14
—
—
AUD
54.26
YEN
0.5679
0.5669
SFR
64.41
Sell
77.89
48.05
54.20
64.30
Buy
Sell
Customs Notified Rates: Sept 05, 2014 [Rs.(Imp/Exp)]: US$ 61.00/60.00;Pound Sterling 100.80/99.55;Euro 80.55/78.60
Daily
The U.S. stocks have gyrated this week as
fears over a global slowdown battled with hopes
of prolonged stimulus by the world’s central
banks. The sell-off came amid worries about the
global economy, and in particular Germany and
the eurozone, as well as mounting geopolitical
tensions and the spread of the ebola virus.
Analysts warned that more fund managers now
believe stock markets have passed their peak.
On Thursday, fears seemed to prevail once
again, with the Dow Jones Industrial Average
tumbling more than 300 points, reversing
Wednesday’s big rally.
It was the third move in a row of more than
200 points by the blue-chip index—a rollercoaster ride that ranks as the most volatile
stretch for the Dow since August 2011.
The S&P 500 declined 40.68 points, or 2.1%,
to 1928.21, leaving the index up 4.3% for the
year. The Nasdaq Composite Index fell 90.26
points, or 2%, to 4378.34.
Weakness in U.S. stocks on Thursday
accelerated after the close of European markets,
which finished the day near the session’s lows
The Stoxx Europe 600 fell 0.4%, losing ground
for the third day in a row.
Speaking at the International Monetary
Fund (IMF) headquarters in Washington,
the watchdog’s managing director Christine
Lagarde said the world faces ‘a new mediocre’
period where growth is low and uneven.
The comments came just days after the IMF
slashed global growth forecasts and declared
that while the US and UK are recovering, the
eurozone is at risk from recession and deflation.
‘In the advanced economies clearly the
recovery is driven by the US and the UK, while the
euro area and Japan are lagging behind,’ she said.
‘In the emerging market economies, you
have reasonably strong, although slower, growth
out of China, better than what we had thought
out of India, and clearly a major slowdown in
Friday 10, October 2014
countries like Brazil and Russia. The low-income
and developing countries are thriving.
‘From a much smaller base, granted, but their
growth rates are very impressive, which is why it
makes the current epidemic, ebola, even more
threatening because it might certainly jeopardise
economic recovery that was under way and
entail a decline of those economies that would
be wasting the gains that they have earned.’
George Osborne said the UK economy is
slowing as the crisis in the eurozone takes its toll
while Lagarde said the single currency bloc is at
risk from a Japan-style period of stagnation.
The double whammy came after figures
showed German exports tumbled 5.8pc in
August, the biggest fall for more than five years.
It followed a separate report earlier this
week showing German industrial production
slumped 4 per cent in August, also the worst
performance since 2009.
Richard Grieveson, an analyst at the
Economist Intelligence Unit, described the
figures as disastrous and said that ‘things may
well get worse before they get better’.
He added: ‘Germany’s ever-growing
importance to aggregate eurozone growth
indicates that things could get very messy in the
bloc in the next few quarters.’
With the FTSE 100 index down 6 per cent
since early September, Societe Generale
strategist Albert Edwards voiced concerns
about the jitters in the market.
He said: ‘Institutional investors are getting
increasingly nervous that we have reached the
end of the road and a major market top may be
forming in equities.’
Manoj Ladwa, head of trading at TJM Partners
in London, said: ‘It’s economic factors that are
hitting the market. After the IMF downgraded
its forecasts a few days ago, the evidence is now
mounting that Europe, in particular, is looking
weak.’
3
Currency Market
The dollar declined to a three-week low
against the yen on Thursday as investors
continued to pare back bullish bets on the
greenback after minutes of the Federal Reserve's
latest meeting pushed out expectations on
when interest rates will begin to rise.
The US currency, however, gained against
a struggling euro, as investors sold the single
euro zone unit after it failed to get above $1.28.
Earlier in the global session, the euro rose to a
two-week high versus the dollar.
The US Treasury yields and implied rates
on Fed fund futures retreated sharply after the
release on Wednesday of the Fed minutes, with
Major
Currencies
Today’s
Crosses
Spot
USD / INR
-
ATM Options (put/call)
0.14
60.95
61.00
61.05
61.10
USD/INR Overnight VAR
17:00
16:00
15:00
14:00
13:00
12:00
11:00
61.15
0.3558
Data releases today
Forecast
Previous
USD Import Prices m/m
-0.5%
-0.9%
EUR French Indust. Produc.m/m
-0.2%
0.2%
Source : Mecklai Financial
the market not seeing any appreciable rise in the
Fed's target rate until around September 2015,
from June 2015 previously. Still, many believe
the dollar will resume its rally, because the U.S.
economy remained on a stable growth path.
"The Fed minutes were a catalyst for the
market to take profits on the dollar's strength
over the last three weeks. But the dollar will be
back," said Ken Wills, senior corporate dealer at
U.S. Forex in Toronto.
"You just look at the global picture, the
concerns in Europe, Japan and emerging
markets. They're all slowing and people are
leery of equity markets, so there's an awful lot of
flows piling into the U.S. Treasury market."
In the meantime, the U.S. labor market
continued to stabilize as the number of
Cash
v/s INR
0.32
USD/INR - 09/10/14
60.90
10:00
The IMF warned that interest rate rises are on
the way in the US and UK even after the Bank
of England froze them again at 0.5 per cent
yesterday, and the Federal Reserve hinted on
Wednesday that it is in no hurry to hike.
Lagarde insisted that rate hikes in the
US could trigger a repeat of last year’s ‘taper
tantrums’ when markets swung violently. She
said countries should ‘prepare themselves for a
bit more volatility’.
Asian markets are trading on a negative note
today on the back of expectations that slow
economic growth in the Euro Zone will hamper
overall global economic growth.
9:00
Daily
6 mth
LIBOR
4
Friday 10, October 2014
Forward Rates v/s INR (Export/ Import)
October
November December
March
June
September
61.17/ 18
61.11/ 13
61.39/ 42
61.78/ 81
62.22/ 26
63.41/ 45
64.66/ 70
65.79/ 83
-
-
-
0.00/0.37
0.00/0.63
0.00/0.83
0.00/1.33
0.00/1.73
0.00/2.09
EUR / USD USD /
JPY(100) GBP / USD
1.2696
77.66/ 68
77.58/ 62
77.95/ 98
78.45/ 49
79.04/ 08
80.60/ 65
82.26/ 30
83.79/ 83
0.16
USD / CHF AUD / USD
107.82
56.74/ 74
56.68/ 69
56.95/ 97
57.31/ 34
57.75/ 79
58.91/ 95
60.14/ 18
61.27/ 32
0.70
GBP / USD
1.6118
98.59/ 62
98.49/ 54
98.96/ 74
99.55/ 26
100.22/ 71
102.04/ 95
103.93/ 01
105.65/ 92
0.06
USD / CHF
0.9539
64.12/ 14
64.06/ 09
64.36/ 38
64.77/ 80
65.27/ 31
66.59/ 63
68.03/ 99
69.30/ 30
3.06
AUD / USD
0.8767
53.62/ 63
53.57/ 59
53.83/ 84
54.17/ 18
54.56/ 58
55.60/ 62
56.70/ 72
57.69/ 71
Source : Mecklai Financial
Daily
Americans filing new claims for unemployment
benefits fell last week to nearly the lowest
level since before the 2007-09 recession. The
government reported that initial claims for
state unemployment benefits dropped to a
seasonally adjusted 287,000 in the week ended
Oct. 4.
The dollar, which has a strong correlation
with U.S. yields and rate expectations, fell
0.3 per cent against the yen, to 107.78 yen,
trimming losses after the jobless claims data. It
earlier fell to 107.53 yen, its lowest mark since
mid-September.
The dollar index, which measures the
greenback against six major currencies, slid
initially, hitting a two-week low of 84.937, before
reversing course. It was last up 0.3 per cent at
85.533.
With the dollar coming under pressure, the
euro earlier rose to $1.2791, its highest level in
two weeks, and nearly 3 cents above a two-year
trough near $1.2500 set last week. But in late
trading, the euro fell 0.4 per cent to $1.2686.
"Unfortunately, there is not a whole lot of
conviction in this dollar profit-taking," said
Shaun Osborne, chief currency strategist at TD
Securities in Toronto. "The euro started moving
lower again, and people are saying, That's
probably it for the euro because we couldn't get
above $1.28."
Meanwhile the Indian Rupee traded
appreciated the most in single day in last two
and gained around 0.5 percent in yesterday’s
trading session. The currency appreciated on
the back of US Federal Reserve in its minutes
on Wednesday hinted towards holding lower
interest rates for longer period of time.
Precious metals
A resurgent dollar, coupled with positive
U.S. economic data, had been driving gold's
declines over the past few weeks. Investors tend
5
Friday 10, October 2014
as on October 9, 2014
Market Highlights - Gold (% change)
Gold
Gold (Spot)
Unit
Last
Prev.
day
WoW MoM
YoY
$/oz
1223.8
0.21
0.9
-3.5
-6.3
Gold
(Spot -Mumbai)
Rs/10
gms
26900.0
0.19
#N/A
-1.3
-9.7
Gold
(LBMA-PM Fix)
$/oz
-
-
-
-
-
Comex
Gold (Apr’14)
$/oz
1223.5
-0.09
2.6
-0.8
-6.4
Rs /10
gms
26958.0
0.83
#N/A
-1.5
-8.0
MCX Gold
(June’14)
Source: Angel Broking
to withdraw from non-interest-bearing assets
to seek higher yields elsewhere when the dollar
gains. Holdings in SPDR Gold Trust, the world's
top gold-backed exchange-traded fund and a
good proxy for investor sentiment, fell by 5.38
tonnes to 762.09 tonnes on Wednesday - the
lowest since December 2008.
Gold retained most of the gains from a fourday rally on Friday and was headed for its best
week in nearly four months as a slump in equities
and growing worries over the global economy
attracted safe-haven bids for the metal.
Spot gold was trading 0.2 percent down to
$1,221.70 an ounce on Friday, after hitting a
2-1/2 week high of $1,233.20 in the previous
session.
The metal has risen more than 2.6 percent
for the week, its best since the week ended June
20, after recovering from a 15-month-low under
$1,200 hit on Monday.
Silver, platinum and palladium also eased on
Friday, but all three metals were set to snap fiveweek losing streaks.
"In the short term, I think gold will be around
$1,220, supported by the market sentiment
after the release of the Fed minutes," said Chen
Min, a precious metals analyst at Jinrui Futures in
Shenzhen, referring to the U.S. Federal Reserve.
"It is likely to test a resistance level at $1,240
and could fall below $1,200 before the end of
the year."
Spot gold prices rose to a two week high on
Daily
Thursday as safe haven buying increased after
U.S. equities tumbled on concerns over the pace
of economic growth.
Minutes of the latest U.S. Federal Reserve
policy meeting prompted investors to push
back their expectations for the timing of a Fed
interest rate rise. Slumping German export and
sluggish industrial output there also sparked
concerns over the pace of economic growth.
On the MCX, gold prices rose by around 0.8
percent and closed at Rs.26958/10 gms.
Spot silver prices declined by 0.2 percent
diverging from gains in gold prices. Strength in
the dollar index also acted as a negative factor.
On the MCX, silver prices rose by 1.04 percent
and closed at Rs.38615/kg.
In its outlook, Angel Broking said, “On an
intraday basis, we expect gold and silver prices
to trade higher as falling equities in the US,
bad economic data from Germany and delay
in timing of Fed interest rate rise will act as a
positive factor for prices. On the MCX, gold and
silver prices are expected to trade higher taking
cues from strength in international markets.”
Base Metals
Base metals rebounded on Thursday after US
central bank authorities signalled they would
not rush to boost interest rates, extending
a period of cheap capital for industry and
investors. The three-month LME copper ended
1.3 percent higher at $6,720 a tonne, erasing the
prior session's small losses and climbing further
from the five-month low of $6,600 a tonne hit
on Oct. 2.
However, sharp gains were capped as signs
the euro area’s economic recovery is losing
momentum. Further, exports from Germany,
the third-largest metals consumer, slumped the
most since January 2009. In the Indian markets,
base metals traded on a mixed note and Rupee
appreciation capped sharp gains. LME Copper
Friday 10, October 2014
prices jumped by 0.9 percent on Thursday
after U.S. central bank authorities signaled
they would not rush to boost interest rates,
extending a period of cheap capital for industry
and investors.
Peru, a top world exporter of copper, silver
and gold, posted a 1.65 percent economic
expansion in the second quarter from the same
period in 2013 - the worst reading since the
third quarter of 2009.
However, signs that Germany is witnessing
a slowdown fuelled serious concerns about
demand for the metal. Also, gain in LME stocks
by 0.2 percent acted as a negative factor. The red
metal closed at $6702/tonne in the last session.
In the Indian markets, copper prices rose by
0.2 percent but sharp gains were restricted due
to Rupee appreciation and closed at Rs.413/kg
in the last session.
From the intra-day perspective, Angel
Broking expects copper prices to trade lower
today owing to concerns that European
economies are slowing down and Germany
is heading for recession. Also, estimates of
negative French Industrial Production data will
exert downside pressure on prices. On the MCX,
copper prices will trade lower in line with trend
in international markets.
"A stronger correction to the upside (in
metals) would not be a surprise to me given
the extreme negative sentiment that was
on the market," said Eugen Weinberg, head
of commodity research at Commerzbank in
Frankfurt.
The metal used in power and construction
is still down 9 percent for the year, weighed by
concerns about the outlook for demand and as
more supplies enter the market.
"I still think the selling has been overdone
and the actual demand we're seeing coming
through is still positive. But clearly sentiment is
weak and the focus on weakening growth is just
6
Daily
exacerbating that," said analyst Daniel Hynes of
ANZ in Sydney.
Weinberg said base metals were likely to
follow Chinese equities higher after China's key
share index ended near a 20-month high after
Premier Li Keqiang said China would launch
further investment in targeted industries.
Industrial metals usually have a close
correlation with the share market in China but
metals have not kept up recently, he said. "There
is a gap between the two and I think it is likely to
close over the coming months."
Growth in China's services sector weakened
slightly in September as new business cooled,
a private survey showed on Wednesday,
reinforcing signs of a slowdown in the world's
second-largest economy that could prompt
more stimulus measures.
Meanwhile, Alcoa Inc has lowered its
estimate for the global aluminium market deficit
this year due to smelter restarts in China, the
world's No. 1 producer, a senior executive said
on Wednesday on a conference call to discuss
third-quarter earnings.
Aurubis, the biggest copper smelter in
Europe, will offer its customers 2015 premiums
for copper cathode of $110 per tonne, slightly
above this year, despite a spot market dampened
by slow demand and excess supply.
On Thursday, in other metals, aluminium
rose 0.5 per cent to close at $1,950, zinc was up
0.7 per cent at $2,335, lead rose 0.4 percent to
$2,088, tin closed 0.3 percent higher at $20,200
and nickel was 0.9 percent higher at $16,675.
Energy Market
Brent crude prices rose by 0.2 percent and
WTI crude prices declined by around 1.8 percent
as Europe's worsening outlook and surging
oil inventories hammered energy markets.
Concerns about world economies sent U.S.
and other stock markets lower, reversing a rally
7
Friday 10, October 2014
Market Highlights - Crude Oil (% change)
as on October 9, 2014
Crude Oil
Unit
Last
Prev.
day
WoW
MoM
YoY
Brent (Spot)
$/bbl
90.4
0.2
-0.7
-9.0 -18.1
Nymex
$/bbl
Crude (June ’14)
85.8
-1.8
-5.8
-7.0 -15.6
ICE Brent
Crude (May’14)
$/bbl
90.1
-1.5
-3.6
-10.7 -17.4
MCX Crude
(May ’14)
Rs/bbl 5264.0
-2.2
#N/A
-6.7 -16.5
Source: Angel Broking
from a day ago sparked by the Federal Reserve's
caution about raising interest rates soon.
Brent crude futures tumbled nearly $2 to
below $89 a barrel on Friday, trading at their
weakest since 2010, as rising supply and a
weakening global economic outlook stretched
a months-long slump in oil prices.
Today, however, the US crude was trading
down by almost $2 to hit its lowest since 2012,
ratcheting up pressure on OPEC to slash output
to rescue prices in the face of slow demand.
"I think we've arrived at a pivotal support
level for both Brent and West Texas Intermediate.
$85 is the area where OPEC has intervened in
the market in the past," said Ric Spooner, chief
market analyst at CMC Markets in Sydney.
Data showed Germany, Europe's No. 1
economy, in August experienced its largest
plunge in exports since the height of the
financial crisis. In China, a Reuter’s poll forecast
that soft domestic demand probably slowed
imports, investment and retail sales to multimonth or multi-year lows in September.
On the MCX, crude prices declined by 2.2
percent taking cues from weak international
markets and closed at Rs.5264/bbl.
The US natural gas futures declined by 0.7
percent on Thursday as forecasts for weak
heating demand over the next two weeks offset
a slightly smaller-than-expected storage build.
The U.S. Energy Information Administration
said utilities added 105 billion cubic feet of gas
Daily
into storage last week that was also less the 112bcf build in the previous week.
Angel Broking in its outlook said, “On an
intraday basis, we expect crude oil prices to
trade lower as demand concerns in Europe and
increasing inventories in the US on account of
maintenance season will act as a negative factor.
Soft demand from China, lower imports, will also
exert downside pressure on crude prices. On the
MCX, crude prices are expected to trade lower
taking cues from weak international markets.”
News & Report
Analysis
Diamond hub planned in
Mumbai to rival Antwerp,
Dubai
The government is discussing a plan to
set up a special zone with tax benefits for
diamond import and trading in Mumbai, to try
and develop the country's financial capital as a
rival to Antwerp and Dubai, which are currently
trading hubs for the precious stone.
Commerce & industry minister Nirmala
Sitharaman held preliminary discussions with
commerce secretary Rajeev Kher and revenue
secretary Shaktikanta Das last week and asked
officials to work out a possible road map, sources
familiar with the development said.
Gems & Jewelry Export Promotion Council's
(GJEPC) estimates suggest that in volume
Friday 10, October 2014
terms, 85% of the global cutting work takes
place in India. At the same time, around 15%
rough diamond is imported directly from the
producing countries, while a majority is shipped
in from the trading hubs.
"A trading hub in India will mean that the
role of middlemen is limited and the concerns
over invoicing, that we often hear from tax
authorities, are reduced," said Parag Parekh,
vice-chairman of GJEPC, which is pushing the
plan. Parekh said the Bharat Diamond Bourse
in Mumbai's Bandra Kurla Complex has been
suggested as a possible option.
Domestic steel makers
scouting for Chinese
technology
Top Indian steel manufacturing firms are
eyeing Chinese technology and low-cost
equipment as India's steel capacity is expected
to soar in the next 15 years, driven by growth in
infrastructure construction in the country.
"We will need Chinese equipment and
technology suppliers for our steel industry's
growth, since China has a mature steel industry
after decades of development," said T V
Narendran, managing director of Tata Steel.
India now has 80 million metric tonne of
steel production capacity and it is expected to
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grow to 300 million tonne in the next 15 years in
tandem with the pace of economic development
as the country embarked on massive expansion
of infrastructure.
China is now facing severe overcapacity in
the steel industry, which has been hit by weak
demand and continued losses.
Narendran said India's steel industry will
continue to grow on the strength of the
government's decision to focus on infrastructure
construction.
"For Chinese steel companies facing
overcapacity problems in their domestic
market, it can be a good idea to invest in India,"
said Narendran, adding that India's steel market
is open to foreign investors.
Indian and Chinese businesses looked to
enhance tie ups specially in the back drop of
improved relations as well as high profile visit
of Chinese President, Xi Jinping to India during
which China has committed USD 20 billion
investments to build two industrial parks as well
as modernisation of railways.
The Chinese equipment stated to be cheaper
compared to other countries may have good
chance to play a big part in the high cost Indian
steel manufacturing expansion.
JSW’s proposal to buy
Welspun Maxsteel gets CCI
nod
Steel major JSW Steel's proposed over Rs
1,000 crore deal to acquire sponge iron maker
Welspun Maxsteel has got the approval from
the Competition Commission.
According to the fair trade regulator
the proposed deal is "not likely to have an
appreciable adverse effect on competition in
India."
On August 18 this year, JSW Steel had
entered into a 'Share Purchase Agreement'
with Welspun Enterprises to acquire entire
Friday 10, October 2014
shareholding of Welspun Maxsteel. Welspun
Maxsteel is promoted by Welspun Enterprises.
The deal involves acquisition of entire stake
of Welspun Maxsteel from Welspun Enterprises,
including the equity shares held through its
affiliates.
In a recently released order, the Competition
Commission of India (CCI) observed, among
others, that sponge iron industry in India had
the presence of large number of players and the
market share of Welspun Maxsteel in production
of sponge iron is "insignificant".
It also noted that "JSW Steel has purchased
a limited quantity of sponge iron from Welspun
Maxsteel mostly for captive consumption."
"However, the same constitutes an
insignificant proportion of the overall purchase
of sponge iron by JSW Steel in India," the fair
trade regulator said.
Going by details in the order, JSW Steel
makes steel products with facilities located at
Vijayanagar (Karnataka), Salem (Tamil Nadu)
and Dolvi (Maharashtra). It also produces
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sponge iron which is mainly used for captive
consumption in its facility at Dolvi in Raigad
district of Maharashtra.
Meanwhile, Welspun Maxsteel manufactures
sponge iron at its production facility located in
Raigad district of Maharashtra.
JSPL to fully acquire JB
Fabinfra
Jindal Steel & Power Ltd (JSPL) will acquire the
remaining 51 per cent stake in its joint venture
JB Fabinfra, from its existing shareholders for a
little over Rs 1 crore.
JSPL currently holds 49 per cent stake in the
JB Fabinfra Pvt Ltd (JBFAB). After the proposed
acquisition, the entity would become a whollyowned subsidiary of the steel major.
"The board of directors of the company at
its meeting held on October 9 has approved
the acquisition of remaining 10,20,000 equity
shares of Rs 10 each for an aggregate amount of
Rs 1.02 crore only representing 51 equity stake
in JBFAB from its existing shareholders," JSPL
said in a regulatory filing.
JBFAB is engaged in the business of
manufacturing of pre- fabricated structures out
of light gauge steel for residential constructions.
"JSPL also has construction materials
business vertical bringing all construction
materials under one umbrella and acquiring
JBFAB manufacturing business will strengthen
the existing portfolio," the filing said.
RSP crude steel output up
23%
Crude steel output at Rourkela Steel Plant
(RSP), a unit of Steel Authority of India Ltd (SAIL),
went up by more than 23 per cent during AprilSeptember period of 2014-15 to 1.35 million
tonne (mt), its best ever performance since the
inception of the plant.
During the same period, hot metal
Friday 10, October 2014
10
production surged 27.4 per cent to 1.5 mt while
salable steel output was 1.28 mt, a rise of 18.3
per cent.
"Besides, the highest ever production
performance was also recorded in many other
important areas like sinter production (227,6531
tonne) and hot rolled coil output (832,330
tonne)," said RSP in a release.
Among flat steel, the steel plant also made
231,669 tonne of steel plates, registering
growth of 2.8 per cent, 128,412 tonne of hot
rolled plates (8.8 per cent), 73,798 tonne of cold
rolled sheets (39.7 per cent), 18,437 tonne of
pipes (12.6 per cent) and 36,407 tonne of fully
processed cold rolled steel, a rise of 1.6 per cent
over the corresponding period of last fiscal.
The plant also performed remarkably in energy
consumption parameters.
With specific energy consumption of 6.583
giga calorie per tonne of crude steel and coke
rate of 518 kg per tonne of hot metal, the steel
unit clocked its best ever performance for any
April-September in a fiscal, said a release by RSP.
ADB’s closure not to affect
India
Allaying fears about the impact of the closure
of Antwerp Diamond Bank on Indian diamond
trade, Gems and Jewellery Export Promotion
Council said it will not have any immediate
direct impact or create liquidity crunch.
Any international bank while closing down
provides an adequate time period for their
clients for repayment of loans and does not
demand an overnight settlement. In case of
ADB, it provides a minimum period of one year
to their clients in India and similar if not more
period to the clients in Antwerp and other
centres which is adequate for the trade.
For the diamond jewellery industry, the
mood is upbeat with the coming festive
season with sales progressing as the season
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approaches. The industry witnesses largest
sales during the period of October to December
annually for Diwali and wedding season and
the Christmas, gift giving season abroad. Indian
market consumes diamonds worth US$2 billion
and the trade has not offered any discount in
the past, neither is expected to offer such steep
drop in price in near future or resort to distress
selling, as there is no reason for the same, GJEPC
said in a release.
China steel drops near record
low over weak demand
Shanghai rebar futures slipped on Thursday
to trade near record lows reached the session
before, as weak demand in top consumer China
kept pressure on steel prices that have fallen by
nearly a third this year.
Steel mills in China with long-term iron ore
contracts with miners have continued to unload
excess cargoes into the spot market, adding
to plentiful supply that has overwhelmed the
market and has trapped prices for the raw
material near five-year lows.
"Chinese steel mills are selling their longterm contract cargoes to us aggressively," said
an iron ore trader at a global trading firm in
Singapore, adding he had received offers for
nine iron ore cargoes from six mills on Thursday.
"Mills are starting to idle their blast furnaces
as steel prices keep dropping due to lack of
demand."
Friday 10, October 2014
11
The most-active rebar contract for January
delivery on the Shanghai Futures Exchange
was down 0.3 percent at 2,525 yuan ($412) a
tonne by midday. It fell to 2,510 yuan earlier,
just off a record low of 2,507 yuan touched on
Wednesday.
The price of construction-used rebar has
dropped nearly 32 per cent this year.
Chinese steel mills have been unloading their
excess iron ore cargoes "to free up cashflow"
amid tighter credit conditions, the trader said.
Sinosteel Corp, China's biggest state-owned
steel trader, last month said it was facing
financial problems as a result of unpaid bills
from customers, but denied rumours that it is
struggling under the weight of overdue loans
amounting to 10 billion yuan ($1.63 billion).
GVK wins green permit for
Australian coal mine
Hyderabad-based GVK Group said on
Thursday it has won environmental permit for
its Alpha coal project in Australia to help it get
closer to starting work on a long-delayed USD
10 billion mine, rail and port project.
GVK Hancock, a 79:21 joint venture between
GVK and Australian billionaire Gina Rinehart's
Hancock Prospecting, now needs to get coal
rail operator Aurizon Holdings onboard and
sign coal sales agreement to bring work on the
project.
"After over six years of comprehensive
environmental assessments and detailed
planning, GVK Hancock has been granted an
Environmental Authority (Clearance) for its
Alpha Coal Project in the Galilee Basin in Central
Queensland," the company said in a statement.
GVK''s Alpha Coal Mine is located in the
Galilee Basin with the first coal lot expected to
be extracted by 2016. When fully commissioned,
the mine will produce 32 million tonne of
thermal a year of low ash, low sulphur coal for
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export to the Asian market.
The Land Court of Queensland in Australia
had earlier granted conditional clearance to
Alpha Coal Mine project.
"This is one of the most significant
milestones in the development of our Galilee
Basin coal projects till date which will create one
of the most remarkable pieces of regional and
economic developments Queensland has seen
for decades," GVK Reddy founder Chairman and
Managing Director of GVK said.
The company said that it further plans to
meet every environmental condition that has
been set by regulatory authorities.
Iron ore output climbs 10%
The domestic production of iron ore has
shown a positive trend during the first half of
the current financial year, despite many mines
being shut in Goa, Karnataka, Odisha and
Jharkhand.
The production touched 77 million tonne
between April and September, a growth of 10
per cent compared to 70 million tonne a year
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12
ago, according to data compiled by OreTeam
Research, a Delhi-based firm. For the year ended
March, the production touched 152 million
tonne.
The mines ministry is yet to confirm the
numbers. “We do not have official data on the
production for the first six months. It is possible
the production has gone up this year mainly
in Odisha and in Karnataka to an extent," said
Basant Poddar, senior vice-president, Federation
of Indian Mineral Industries.
He expressed concern over the delay by the
Karnataka government in giving approvals for
the renewal of leases. Many mines are awaiting
these, he said.
According to miners and analysts, the
production has come largely from Odisha,
Chhattisgarh and Karnataka during the first six
months.“Odisha had done a considerable amount
of production before the mines were closed after
the Supreme Court order. State-owned NMDC
has geared up for increasing its production both
in Chhattisgarh and Karnataka," said Prakash
Duvvuri, head of research at OreTeam.