Persons who receive or attempt to export stolen property in the scrap metal trade could

shortly be faced with an increased fine of $2 million up from $3,000.

This was among several changes outlined by Industry and Commerce Minister, Karl

Samuda at a press conference this morning to govern the resumption of the export trade.

The recommendation for the increased fine is to be made in a submission to Cabinet.

In addition, dealers caught with stolen materials will be removed from the list of approved

traders.

According to Mr. Samuda the move is necessary to eliminate the illegal activities, which

have led to a shutdown in the trade on two occasions.

Of the 63 registered scrap metal sites currently in operation, 50 have so far been

inspected by the Customs Department.

Included in this number are three sites at the Riverton Landfill in Kingston.

Mr. Samuda said inspection is being conducted on an ongoing basis and the remaining

13 sites should be inspected by the end of the month.

Mr. Samuda warned that the government would not tolerate any threats against officers

involved in the trade.

Additionally the number of customs officers assigned to the trade has been increased

from six to 20.

Dealers will also be required to ensure that the perimeter of their properties is properly

fenced and that the officers involved in monitoring the process are protected.

In this regard the dealers will undertake security expenses for these personnel.

Export of scrap metals resumed on Tuesday, following a shutdown last month due to

increased thefts in the trade.

http://www.worldscrap.com/modules/ne...e.php?aid=7979 ■

Metals markets were largely calm during the overnight hours but gold continued to be exhibiting continuing dollar-strength related moderation and was not able to get above the $965 area by much (lows came near $954).

The greenback added a few more ticks in value, rising to 72.30 but then again, so did crude oil, which climbed a bit more than $1.75 to the $131.05 mark. Geopolitics showed signs of significant cooling from last week's heated rhetoric. In the latest developments, Iran welcomed the presence of U.S. officials at tomorrow's talks in Geneva. The Bush administration, taking a page from the playbook of Mr. Obama, decided that hurling warnings towards Iran is probably less wise than trying to open a communications channel and ascertaining if there is room for possible solutions to the nuclear program bugaboo.

New York trading opened the final session of this week on an ominously weakening note, with gold showing an initial loss $7.10 per ounce at $949.90 while players will now have to look at oil, equities, and currencies in the absence of anything to digest from today's blank economic calendar.

A raft of corporate earnings (and lack thereof) hit the street after yesterday's final bell and some of them offered (Merril's) cause for added worry, while others (Citi's) showed that some progress is being achieved in the great unwind. The Dow might have an interesting time trying to deal with the good, the bad, and the ugly as it resumes trading this morning.

Silver dropped 37 more cents, trading at $18.17 while platinum and palladium continued to show further losses as well, with the former declining $32 to $1834 and the latter falling $4 to $417 per ounce. Noble metals values remain under pressure as the apparent postponement of the would-be diesel revival in the USA has been put on the back-burner due to sky-high diesel fuel prices. When additionally considering the latest N. American auto sales trends, platinum and palladium have been thus far unable to capitalize on the continuing supply issues in South Africa and have fallen to near 11 week lows.

Today's focus shifts back to one of the gold market's sine qua non pillars of demand: India. While investment and safe-haven demand have required almost all of gold's recent headlines to be printed in bold, extra-large fonts, the underlying drought in Indian demand should have analysts up at night, wondering who will absorb the metal that the sub-continental buyers are evidently unwilling to consume at current prices.

As we normally come to this discussion table from an almost purely fundamentals-oriented angle, we must once again ring the alarm bell to the complacent bulls who believe that India simply does not matter any more, and that ETFs and such will take every ounce of gold that is now being, and will be dug up from the ground.

http://www.worldscrap.com/modules/ne...e.php?aid=7992 ■

Metals markets were largely calm during the overnight hours but gold continued to be exhibiting continuing dollar-strength related moderation and was not able to get above the $965 area by much (lows came near $954).

The greenback added a few more ticks in value, rising to 72.30 but then again, so did crude oil, which climbed a bit more than $1.75 to the $131.05 mark. Geopolitics showed signs of significant cooling from last week's heated rhetoric. In the latest developments, Iran welcomed the presence of U.S. officials at tomorrow's talks in Geneva. The Bush administration, taking a page from the playbook of Mr. Obama, decided that hurling warnings towards Iran is probably less wise than trying to open a communications channel and ascertaining if there is room for possible solutions to the nuclear program bugaboo.

New York trading opened the final session of this week on an ominously weakening note, with gold showing an initial loss $7.10 per ounce at $949.90 while players will now have to look at oil, equities, and currencies in the absence of anything to digest from today's blank economic calendar.

A raft of corporate earnings (and lack thereof) hit the street after yesterday's final bell and some of them offered (Merril's) cause for added worry, while others (Citi's) showed that some progress is being achieved in the great unwind. The Dow might have an interesting time trying to deal with the good, the bad, and the ugly as it resumes trading this morning.

Silver dropped 37 more cents, trading at $18.17 while platinum and palladium continued to show further losses as well, with the former declining $32 to $1834 and the latter falling $4 to $417 per ounce. Noble metals values remain under pressure as the apparent postponement of the would-be diesel revival in the USA has been put on the back-burner due to sky-high diesel fuel prices. When additionally considering the latest N. American auto sales trends, platinum and palladium have been thus far unable to capitalize on the continuing supply issues in South Africa and have fallen to near 11 week lows.

Today's focus shifts back to one of the gold market's sine qua non pillars of demand: India. While investment and safe-haven demand have required almost all of gold's recent headlines to be printed in bold, extra-large fonts, the underlying drought in Indian demand should have analysts up at night, wondering who will absorb the metal that the sub-continental buyers are evidently unwilling to consume at current prices.

As we normally come to this discussion table from an almost purely fundamentals-oriented angle, we must once again ring the alarm bell to the complacent bulls who believe that India simply does not matter any more, and that ETFs and such will take every ounce of gold that is now being, and will be dug up from the ground.

http://www.worldscrap.com/modules/ne...e.php?aid=7992 ■

In a bid to restore fair competition in the US market, a decision has found laminated woven polypropylene sacks dumped and imports subsidized from China. By a 6-0 vote, the U.S. International Trade Commission (ITC) has affirmatively decided on a petition filed by US producers of laminated woven PP sacks against dumped and subsidized imports of these products from China. This decision implies that US importers of these products from China will be required to pay high duties to offset unfair pricing and Chinese government subsidies.

Last month, the US Department of Commerce made affirmative antidumping and countervailing duty determinations with respect to these imported products. The dept. found that the margin of dumping ranged from 64.28% to 91.73%, and that the net subsidy rate ranged from 29.54% to 352.82%, depending on the identity of the Chinese producer. Consequently, import duties in these amounts will be imposed to offset dumping and the unfair advantage of government subsidies given to Chinese producers of these products. Because the antidumping and countervailing duties apply independently to imports of these products, the combined duties that will result from these measures will range from 93.82% to 444.55% of the customs value of the imported products, depending upon the identity of the Chinese producer.

http://www.worldscrap.com/modules/ne...e.php?aid=8013 ■

In a bid to restore fair competition in the US market, a decision has found laminated woven polypropylene sacks dumped and imports subsidized from China. By a 6-0 vote, the U.S. International Trade Commission (ITC) has affirmatively decided on a petition filed by US producers of laminated woven PP sacks against dumped and subsidized imports of these products from China. This decision implies that US importers of these products from China will be required to pay high duties to offset unfair pricing and Chinese government subsidies.

Last month, the US Department of Commerce made affirmative antidumping and countervailing duty determinations with respect to these imported products. The dept. found that the margin of dumping ranged from 64.28% to 91.73%, and that the net subsidy rate ranged from 29.54% to 352.82%, depending on the identity of the Chinese producer. Consequently, import duties in these amounts will be imposed to offset dumping and the unfair advantage of government subsidies given to Chinese producers of these products. Because the antidumping and countervailing duties apply independently to imports of these products, the combined duties that will result from these measures will range from 93.82% to 444.55% of the customs value of the imported products, depending upon the identity of the Chinese producer.

http://www.worldscrap.com/modules/ne...e.php?aid=8013 ■

PE

PE market kept rolling steadily today and the prices kept stayed in line with earlier day. The traders shifted away from importing those supply banned by Olympic restrictions, and the demand for film remained stronger. The latest price: LDPE film 1264USD per ton.

PC

PC supply was stable and the trade for PC regrinds and alloy was growing, while the trade for high quality material was stagnanted due to a higher price. The latest price: PC clear post-industrial 1700USD per ton.

PVC

Both the supply of PVC flexible and rigid material were tightening, and it was said that the profit hiked than earlier days. The latest price: mixed color PVC flexible 600USD per ton, PVC rigid 700USD per ton.

PMMA

It was a difficult for those investors to find PMMA board sheet supply while the demand was robust, which has attracted speculation flooded into the market, therefore, the price has stayed in a high level. The latest price: PMMA board sheet 2500USD per ton.

ABS

The supply for ABS regrinds was tightening and the downstream buyers presented cautiously. The trade has been in general. The latest price: ABS clear post-industrial 1571USD per ton.

PP

PP price stayed in flatness today and the various kinds of varieties were available, the demand for PP bag was growing. The latest price: clear PP regrinds 1357USD per ton.

PS

PS price kept flat with yesterday and the demand for HIPS and EPS was stronger. The traders have cut down their imported volume. The latest price: HIPS white icebox regrinds 1029USD per ton.

PET

PET market kept rolling steadily stable and the most traded was spots. The whole market was well moved up on stable demand from the downstream buyers. The latest price: PET mixed color bottle 857USD per ton.

WorldScrap

* The copying, republication or redistribution of World Scrap News Content is expressly prohibited without the prior written consent of World Scrap News. All rights reserved ■

PE

PE market kept rolling steadily today and the prices kept stayed in line with earlier day. The traders shifted away from importing those supply banned by Olympic restrictions, and the demand for film remained stronger. The latest price: LDPE film 1264USD per ton.

PC

PC supply was stable and the trade for PC regrinds and alloy was growing, while the trade for high quality material was stagnanted due to a higher price. The latest price: PC clear post-industrial 1700USD per ton.

PVC

Both the supply of PVC flexible and rigid material were tightening, and it was said that the profit hiked than earlier days. The latest price: mixed color PVC flexible 600USD per ton, PVC rigid 700USD per ton.

PMMA

It was a difficult for those investors to find PMMA board sheet supply while the demand was robust, which has attracted speculation flooded into the market, therefore, the price has stayed in a high level. The latest price: PMMA board sheet 2500USD per ton.

ABS

The supply for ABS regrinds was tightening and the downstream buyers presented cautiously. The trade has been in general. The latest price: ABS clear post-industrial 1571USD per ton.

PP

PP price stayed in flatness today and the various kinds of varieties were available, the demand for PP bag was growing. The latest price: clear PP regrinds 1357USD per ton.

PS

PS price kept flat with yesterday and the demand for HIPS and EPS was stronger. The traders have cut down their imported volume. The latest price: HIPS white icebox regrinds 1029USD per ton.

PET

PET market kept rolling steadily stable and the most traded was spots. The whole market was well moved up on stable demand from the downstream buyers. The latest price: PET mixed color bottle 857USD per ton.

WorldScrap

* The copying, republication or redistribution of World Scrap News Content is expressly prohibited without the prior written consent of World Scrap News. All rights reserved ■

Base metals prices edged lower in thin volumes during London Metal Exchange premarket trade Wednesday. "They're all drifting lower, partly on a lack of interest. The dollar is improving a bit and they're testing a bit on the downside, but there's very little going on," said a trader with one LME ring dealer. "There's nothing dramatic going on. It's a typical summer period -- there's very little interest, it's just down to the people who want to play it," he said. "We've been here before. They'll have to a go a bit lower to activate some sell-stops and nervous liquidation." Aluminium prices eased lower in early trade, with three-months aluminium bid at $3,017/mt at 0910 GMT, down $13 from Tuesday's evening kerb close. Prices have retreated steadily from record peaks of $3,380/mt earlier this month, and the move lower has seen aluminium consumers in Japan and South Korea breathe easier this week, local market sources said.

Sources said consumers, who had kept quiet for two weeks, were back this week fixing prices for their aluminium purchases. "Consumers had waited enough, some could not wait any longer for LME prices to come down further," said a Japanese trader. Some consumers were still wary of the dollar firming against the yen this week to Yen 107, from Yen 104 last Wednesday, but they decided to fix prices this week nevertheless, the trader added. Japan is in the midst of the peak summer aluminium consumption season. Copper dipped $25 to be bid at $8,105/mt at 0910 GMT, while lead was off $14 at $2,126/mt as the market retreated from overnight highs around $2,195/mt. Zinc saw a higher turnover than copper on LME Select as the market bucked the declining trend elsewhere to edge up $20 by 0910 GMT, bid at $1,865/mt. Nickel slipped $70 to $20,430/mt, while tin was off $100 at $23,350/mt. World tin consumption showed a slight increase in the first five months of 2008, ITRI said Wednesday.

Quoting preliminary statistics released by the World Bureau of Metal Statistics, ITRI said that global refined tin consumption is estimated to have increased by 1.1% to 147,900 mt in January-May compared to the same period of 2007. The WBMS data shows that growth in Asia has been partly offset by declines in apparent consumption in the USA and Europe. Chinese demand rose by 11.2% and Japanese consumption rose by 5.8% compared with the depressed 2007 total. However US consumption is estimated to have fallen by 24.1%, while EU27 demand declined by 8.1%, ITRI said. Standard aluminium alloy edged up $5 to be bid at $2,585/mt, while there were no bids for North American alloy as of 0910 GMT on LME Select.

http://www.worldscrap.com/modules/ne...e.php?aid=8053 ■

Base metals prices edged lower in thin volumes during London Metal Exchange premarket trade Wednesday. "They're all drifting lower, partly on a lack of interest. The dollar is improving a bit and they're testing a bit on the downside, but there's very little going on," said a trader with one LME ring dealer. "There's nothing dramatic going on. It's a typical summer period -- there's very little interest, it's just down to the people who want to play it," he said. "We've been here before. They'll have to a go a bit lower to activate some sell-stops and nervous liquidation." Aluminium prices eased lower in early trade, with three-months aluminium bid at $3,017/mt at 0910 GMT, down $13 from Tuesday's evening kerb close. Prices have retreated steadily from record peaks of $3,380/mt earlier this month, and the move lower has seen aluminium consumers in Japan and South Korea breathe easier this week, local market sources said.

Sources said consumers, who had kept quiet for two weeks, were back this week fixing prices for their aluminium purchases. "Consumers had waited enough, some could not wait any longer for LME prices to come down further," said a Japanese trader. Some consumers were still wary of the dollar firming against the yen this week to Yen 107, from Yen 104 last Wednesday, but they decided to fix prices this week nevertheless, the trader added. Japan is in the midst of the peak summer aluminium consumption season. Copper dipped $25 to be bid at $8,105/mt at 0910 GMT, while lead was off $14 at $2,126/mt as the market retreated from overnight highs around $2,195/mt. Zinc saw a higher turnover than copper on LME Select as the market bucked the declining trend elsewhere to edge up $20 by 0910 GMT, bid at $1,865/mt. Nickel slipped $70 to $20,430/mt, while tin was off $100 at $23,350/mt. World tin consumption showed a slight increase in the first five months of 2008, ITRI said Wednesday.

Quoting preliminary statistics released by the World Bureau of Metal Statistics, ITRI said that global refined tin consumption is estimated to have increased by 1.1% to 147,900 mt in January-May compared to the same period of 2007. The WBMS data shows that growth in Asia has been partly offset by declines in apparent consumption in the USA and Europe. Chinese demand rose by 11.2% and Japanese consumption rose by 5.8% compared with the depressed 2007 total. However US consumption is estimated to have fallen by 24.1%, while EU27 demand declined by 8.1%, ITRI said. Standard aluminium alloy edged up $5 to be bid at $2,585/mt, while there were no bids for North American alloy as of 0910 GMT on LME Select.

http://www.worldscrap.com/modules/ne...e.php?aid=8053 ■

Copper has been in the news as the metal of choice for thieves around Wichita.

David Vaughn asks, "If the world has a large supply of copper, and so much is available, why is it so expensive?"

Good question.

Copper is one of our most used, most common metals. The supply of copper in the United States is plentiful. For a while, copper was not expensive. As a result, it is used in nearly everything, which has, in turn, increased demand.

According to livescience.com, the high demand drove the price of copper higher. The spike, according to the website, came in the early 2000s.

That's the reason copper thefts are now about as common as copper itself. No one was stealing copper in the '90s, but now, it seems not a scrap of copper is safe from thieves.

But, with the abundant supply, why the high prices? The answer is that the United States has a large amount, but other countries do not.

The global demand has, as a result, increased the price.

http://www.worldscrap.com/modules/ne...e.php?aid=8061 ■

Copper has been in the news as the metal of choice for thieves around Wichita.

David Vaughn asks, "If the world has a large supply of copper, and so much is available, why is it so expensive?"

Good question.

Copper is one of our most used, most common metals. The supply of copper in the United States is plentiful. For a while, copper was not expensive. As a result, it is used in nearly everything, which has, in turn, increased demand.

According to livescience.com, the high demand drove the price of copper higher. The spike, according to the website, came in the early 2000s.

That's the reason copper thefts are now about as common as copper itself. No one was stealing copper in the '90s, but now, it seems not a scrap of copper is safe from thieves.

But, with the abundant supply, why the high prices? The answer is that the United States has a large amount, but other countries do not.

The global demand has, as a result, increased the price.

http://www.worldscrap.com/modules/ne...e.php?aid=8061 ■

With the 3 month moratorium by Indian steel majors on holding to their reduced price line slated to expire early next month, Indian government has made it clear that any sharp increase in prices by the producers could attract fiscal measures as the inflation is still high and has again urged steel makers to be reasonable.

Mr Ram Vilas Paswan union minister of steel told media that government will discourage steel firms from increasing prices after a 3 month freeze, which the companies had agreed to ends early next month.

Mr Paswan said that "I have instructed the steel secretary to see that steel companies do not raise prices according to their own will. There must be a reason behind price increase. They must explain their compulsion to increase prices.

Steel firms say they need to increase prices as the cost of inputs is rising, but Paswan said the government would verify this on the basis of the experience of state run firms.

As per a report in ET, the steel ministry is understood to have asked state run Steel Authority of India Limited to maintain prices at current levels for a few more months. With SAIL controlling over 30% of domestic market, this decision would mean that other companies would also have to resist any price rise.

The report added that the steel ministry is also likely to meet companies next week seeking extension of the price moratorium for a few more months.

http://www.worldscrap.com/modules/ne...e.php?aid=8080 ■

With the 3 month moratorium by Indian steel majors on holding to their reduced price line slated to expire early next month, Indian government has made it clear that any sharp increase in prices by the producers could attract fiscal measures as the inflation is still high and has again urged steel makers to be reasonable.

Mr Ram Vilas Paswan union minister of steel told media that government will discourage steel firms from increasing prices after a 3 month freeze, which the companies had agreed to ends early next month.

Mr Paswan said that "I have instructed the steel secretary to see that steel companies do not raise prices according to their own will. There must be a reason behind price increase. They must explain their compulsion to increase prices.

Steel firms say they need to increase prices as the cost of inputs is rising, but Paswan said the government would verify this on the basis of the experience of state run firms.

As per a report in ET, the steel ministry is understood to have asked state run Steel Authority of India Limited to maintain prices at current levels for a few more months. With SAIL controlling over 30% of domestic market, this decision would mean that other companies would also have to resist any price rise.

The report added that the steel ministry is also likely to meet companies next week seeking extension of the price moratorium for a few more months.

http://www.worldscrap.com/modules/ne...e.php?aid=8080 ■

WorldScrap- LME nickel was closed at 18850USD, climbed up 350USD from earlier day, and the stainless steel price has seen a rising of 30USD from earlier day. Nickel was quoted at 21714USD in China market, advanced 290USD from yesterday. The scrap stainless steel price kept in flatness while the market maintained in stagnancy on such dimmed buying intention, which pushed the investors into negative atmosphere.

WorldScrap

* The copying, republication or redistribution of World Scrap News Content is expressly prohibited without the prior written consent of World Scrap News. All rights reserved ■

WorldScrap- LME nickel was closed at 18850USD, climbed up 350USD from earlier day, and the stainless steel price has seen a rising of 30USD from earlier day. Nickel was quoted at 21714USD in China market, advanced 290USD from yesterday. The scrap stainless steel price kept in flatness while the market maintained in stagnancy on such dimmed buying intention, which pushed the investors into negative atmosphere.

WorldScrap

* The copying, republication or redistribution of World Scrap News Content is expressly prohibited without the prior written consent of World Scrap News. All rights reserved ■

JMB reported that ferrous scrap price dropped around Osaka for 2 weeks in a row when local steel makers get more scrap arrivals. Local electric furnace steel makers reduced the purchase price by JPY 500 to JPY 1,000 to JPY 71,000 to JPY 72,000 per tonne for H2 grade last week, which was JPY 1,250 or 2% lower than recent peak.

http://www.worldscrap.com/modules/ne...e.php?aid=8117 ■

JMB reported that ferrous scrap price dropped around Osaka for 2 weeks in a row when local steel makers get more scrap arrivals. Local electric furnace steel makers reduced the purchase price by JPY 500 to JPY 1,000 to JPY 71,000 to JPY 72,000 per tonne for H2 grade last week, which was JPY 1,250 or 2% lower than recent peak.

http://www.worldscrap.com/modules/ne...e.php?aid=8117 ■

MUMBAI, July 31 (Reuters) - India's copper futures stayed firm on Thursday on the Multi Commodity Exchange of India Ltd (MCX) tracking overseas markets where tight supplies replaced worries that industrial demand was waning.

A Mexican copper miner said on Wednesday it had no set date to resume production at a mine, helping prices rise.

The metal may remain firm in the rest of the session supported by likely higher U.S. GDP data and firm crude oil, said Praveen Singh, analyst at Sharekhan Commodities Pvt Ltd.

Higher GDP would brighten the demand outlook for the metal as it is mainly used in infrastructure and housing construction.

At 6:27 p.m., August copper MCCQ8 was at 345.60 rupees per kg, up 0.95 percent from the previous day.

The metal could trade within 340 rupees to 350 rupees, with a bias on the upside, Singh said.

ZINC, LEAD:

Zinc and lead prices rose after China started tightening supplies, said Debjyoti Chatterjee, associate vice-president of MAPE ADMISI Commodities Pvt Ltd.

Overseas zinc futures jumped over 6 percent on Thursday after top producer China cancelled export rebates in a move that could curb the flow of Chinese zinc into the world market.

The Chinese tax rebate of five percent for super high-grade zinc, used as a galvanizing agent on steel, will come into effect from Aug 1. See

At 6:30 p.m., August zinc MZIQ8 traded at 83.10 rupees per kg, up 3.04 percent from the previous day.

August lead MLDQ8 traded at 96.45 rupees per kg, up 2.44 percent from the previous day.

Nickel futures edged up due to a drop in warehouse stocks, analysts said.

August Nickel MNKQ8 was at 807 rupees per kg, up 0.4 percent.

http://www.worldscrap.com/modules/ne...e.php?aid=8156 ■

NEW DELHI: The Centre is considering a proposal to bring iron ore under price control in an attempt to check steel prices. In a move aimed at checking volatility in the spot market, the government is planning to make it mandatory for miners to sign long-term supply contracts with steel companies instead of selling at high spot prices.

The move follows the sharp rise in ore prices, which has pushed up the cost of steel-making. The government has got steel manufacturers to announce a voluntary moratorium on price hikes. It has, however, failed to get a similar commitment from miners.

¡°The committee of secretaries (CoS) reviewing prices of essential commodities has decided that high-grade ore, especially lumps, would be provided at reasonable prices to steel producers to check metal price escalation. Ministries of steel, mines and commerce will now take action to arrange meetings between iron ore miners and independent steel producers to facilitate preferential pricing formula and enforce long-term contracts,¡± an official source said.

The CoS decision is based on a steel ministry proposal which says that all efforts to contain steel prices would go waste if iron ore lump prices continue to rise. This would increase the price of sponge iron and pig iron and, in turn, impact steel prices.

Lump prices have gone up between Rs 500 and Rs 1,000 per tonne in the last two months. The CoS may also ask the mining ministry to seek a voluntary moratorium on price hikes from mining companies on a temporary basis, similar to the one followed by steel companies.

¡°The moratorium plan is completely absurd. There is already a 15% ad valorem duty on ore exports and any further control would just kill the industry,¡± said a mining company executive who did not wish to be named. He added that prices have moved up only in the case of lumps, which are consumed to the extent of just over 13 million tonne by sponge iron units whose requirements are not regular.

Out of the total domestic ore production of 190 million tonne, 85 million tonne is consumed by the domestic industry. Out of the total domestic consumption, 56% is bought from open market by steel companies. While state-owned NMDC is the largest ore supplier accounting for almost 28% of domestic sales, the remaining is supplied by private miners who sell ore at higher spot prices.

Iron ore is the basic raw material for producing steel and accounts for almost 25% of the cost of steel-making. Any increase in ore prices affects the cost structure of steel companies and generally leads to higher steel prices.

Higher ore prices, coupled with a 200% increase in coking coal prices are among the reasons cited by steel manufacturers to raise steel prices. In May, the companies had agreed to reduce steel prices by Rs 4,000 per tonne and have been holding prices ever since then.

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AK Steel Corp. officials announced that a $1,040 per ton surcharge will be added to invoices for electrical steel products shipped in September.

In addition, a complete list of September surcharges for the broad range of stainless steel products AK Steel produces can be found on the company's Web site at www.aksteel.com.

Company officials said their surcharges are based on reported prices for raw materials and energy used to manufacture the products. The July 2008 purchase cost was used to determine the September surcharges.

Russian firm not interested in AK

WEST CHESTER TWP. ¡ª Russian steelmaker Evraz has denied interest in purchasing AK Steel Corp.

Deputy CEO Vasily Migunov reportedly told Business Today on Tuesday, Aug. 5 it had "no interest" in the local Fortune 500 company.

Earlier this month, German steelmaker ThyssenKrupp denied it might be interested in buying AK Steel after media reports linked the company to a possible buyout deal.

There has been speculation that AK may be entertaining sales talks with multiple parties, such as ThyssenKrupp, Evraz and Russia's largest steelmaker Severstal were involved in sale negotiations with the company.

Analysts have said the sales talk rumors were most likely dropped by investors trying to boost AK's stock price.

The company's stock increased 38 cents to close at $53.37 on Wednesday, Aug. 6.

Investment firm adds BAES shares

WEST CHESTER TWP. ¡ª Parametric Portfolio Associates has boosted its shares in BAE Systems by almost 16 percent, according to a securities filing.

The investment firm added an additional 29,885 shares to its portfolio, bringing its total holdings to 216,827 shares.

London-based BAE Systems has a 90,000-square-foot office and manufacturing facility in West Chester Twp. and employs 1,600 people there.

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Platts reported that summer shutdowns continued to put a freeze on zinc premiums for another week, with price assessment for special high grade zinc unmoved at 4 cents plus LME cash and the price for alloy number 3 immobile at 17 cents plus LME cash.

The report cited a trader as saying that "The market is still mired in summer. We continue to see very little interest on the buy side in zinc."

He said that "Zinc is probably trading lower than it should, based on the price of other metals," the trader said. "Close to 20%-30% of world production is at cash cost. However, mine shutdowns that will set the stage for a price comeback are starting to happen and Chinese demand might go up after the Olympics."

With scant deals on either material keeping premiums static for now, the focus has turned to the beleaguered zinc LME price that seems in perpetual freefall.

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MUMBAI (Thomson Financial) - Following are the official prices in Mumbai for base metals:

In Indian rupees Tuesday Monday

Copper Wire in kg 390 393

Aluminium Ingots in kg 142 142

Nickel Cathode in kg 1,005 995

Zinc Slab in kg 99 100

Lead Ingots in kg 108 108

1 US dollar = 42.34 Indian rupees

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The Office of the Prime Minister (OPM) has said it is again advising all metal dealers that continued failure to comply with the requirements to which they have agreed may prompt a re-imposition of the ban on the trade in ferrous scrap metal.

According to a press release from OPM on Monday, all dealers in scrap metal should note that one of the conditions for the reopening of the scrap metal trade was that they ¡°would maintain their respective scrap metal yards in a tidy manner, properly fenced and blocking view from the main roads.¡±

Another condition, the release stated, was that all trucks would be unloaded and all containers packed inside scrap yards and neither trucks nor containers would be on the road or the side of the road.

Meanwhile, OPM said it had noted with great concern that a large number of dealers had not been complying with these conditions.

The release referred to the commitment to work together to bring an end to vandalism, but there were recent reports of the losses of manhole (sewer) covers. And OPM warned scrap metal dealers to err on the side of caution and not purchase items that might have been vandalized.

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It is reported that US scrap market appears soft due to the summer vacation and market activity is very quiet.

In the US, the average scrap price dropped by USD 25 per ton, a wide margin since August 4th 2008. Meanwhile, HMS and shredded scrap prices have been reduced by USD 50 to USD 70 per ton.

Only a few buyers in Turkey and Asian countries are continuing some small quantity purchasing. Distributors are expecting further decreases in prices.

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Securities Times quoted industrial analysts said that as the world's biggest aluminum producer, China will impose 15% tax on aluminum alloy export as of August 20th to curb over investment in energy intensive industries. That might give a heavy blow to domestic aluminum market, which has already been plagued supply glut. Meanwhile, the news has sent global aluminum price to break over USD 2000 per tonne on Monday. However, domestic forward contacts gains merely CNY 70 per tonne to close at CNY 18,455 per tonne.

The investors appear to be calm since they have been speculating the tax for several months. The government has started to discourage export of high energy-consuming and highly polluting as early as 2004. Beijing has kept a close eye on electrolytic aluminum sector as it battles severe power shortage over the years.

The authority first revoked tax rebate on aluminum pig and imposed tariff on the metal's export. It has taken similar steps to curb export of aluminum and the metal's alloy. The data shows that China's un-forging aluminum, including virgin aluminum and un-forging aluminum alloy adds up to 430,000 tonnes in the first six months up by 57.7% from same period of last year.

According to China International Capital Corporation in a recent report the new tax would further depress sluggish domestic electrolytic aluminum market, noting that China's un-forging aluminum alloy export totals 380,000 tonnes in the first half, representing 23% of the country's total aluminum product exports and 5% of its electrolytic aluminum consumption. Therefore, this would dampen domestic electrolytic aluminum consumption and put the price under downward pressure.

The report said electrolytic aluminum price would have limited downward scope bolstered by escalating cost. The production cost of virgin aluminum has already surged to CNY 17,500 per tonne at the moment following steep rise of oil price.

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A movement that started in Leaf Rapids, Manitoba has now spread across the entire globe. In April 2007, the tiny Canadian town, population 539, issued the first North American ban on the use of plastic shopping bags. Since that time, communities and businesses across Canada and the United States have been following the example of this "little town that could" and are saying goodbye to this environmental menace.

In Fredericton, despite the city's reputation as an environmental leader, thousands of plastic bags continue to leave stores each and everyday. Plans are currently being formulated through Green Matters, the city's environmental awareness campaign, but at this point, no community plan is in place.

"A lot of local businesses are interested in moving away from plastic bags and are interested in doing so in co-operation with the city's Green Matters program," said Taylor Gray, spokesperson for the campaign. "We're currently working on our new program for Green Matters that will hopefully come out in the fall as a partnership with local businesses."

The city feels a complete ban on the use of plastic bags isn't the right move for the community at this point.

"The first goal isn't necessarily a ban, but what we would like to see is the discontinued use of plastic bags, so our first effort is going to be in partnership with local businesses. A ban would require a bylaw, and that bylaw would then have to be enforced. We feel that because of Fredericton's size and the amount of community awareness that exists here, it's very possible that a voluntary ban could succeed."

According to Taylor, both the city's independent businesses and its larger chain stores are ready to make the move, but are waiting for an official program to be launched.

"We're getting a lot of interest from both sides," he said. "Several businesses are interested in following a move by Green Matters and being part of a sweep, citywide. Most of the larger chains are already offering reusable bags now. I know Sobeys and the Super Store offer a reusable option and the Home Depot is starting to get in on it as well by offering customers the option of reusable verses plastic."

The numbers that appear in relation to plastic bags are staggering. According to one source, it takes 12 million barrels of oil to manufacture 100 billion plastic bags, which is how many are used in the U.S. alone each year. The number worldwide has been estimated at between 500 billion and one trillion plastic bags manufactured annually.

Prior to enforcing their own ban, liquor stores in Ontario estimated their own use of plastic bags at close to 80 million. New Brunswick liquor stores are still using plastic bags. A spokesperson for NB Liquor could not be reached at the time of this article to comment on whether or not plans are in the works to phase out their use.

Despite the staggering numbers, The Canadian Plastics Industry Association has launched its own campaign in defense of the bags and their common uses. Their website www.myplasticbags.ca promotes their use through statements like, "The industry believes that plastic shopping bags are a valuable resource that should not be thrown away. Used primarily as carry-out bags, they provide a safe, convenient and hygienic way to transport our groceries. And they can be reused in many ways and then recycled into other products."

Communities all across the province are beginning to take a stronger environmental stance on many issues in an attempt to educate residents on reducing their individual consumption of all non-reusable goods. Moncton and Saint John are among several other N.B. communities that are taking a more active role in environmental issues. Both these cities provide information on their websites about the programs they have in place. To learn more about how you can make a difference in your own community, contact your local municipality directly, to find out what programs are in place and how you can get involved.

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An environmental campaigner Mike Anane has called for a review of the country¡¯s environmental laws to prevent the importation of used computers and electrical gadgets into the country.

He says the practice has reached ¡°disastrous proportions¡± and needed immediate action to be taken.

¡°Every week truck loads of used computers are dumped into the country from the industrialized countries which are hazardous for our environment especially to our children who break open these computers.¡±

Mike Anane in an interview with Joy news, also called for heavy penalties against companies who breach the laws by importing these hazardous materials popularly known as e-waste.

These recommendations were in response to an appeal by the Minister of Environment and Local Government Kojo Adjei Darko to western countries to desist from using Ghana as damping ground for obsolete computers.

The Minister made the appeal at the ongoing UN Conference on climate change in Accra.

But Mike Anane says government could better than appealing to western countries.

¡°There is the need for government to go a step further, mere appeals are not enough.¡±

¡°We will need to review our laws with penalties contained in them to deter companies from engaging in such businesses.¡±

In his response, Kojo Adjei Darko said the way to go is to educate people about hazards associated with e-waste.

¡°Once people are made aware of the hazards associated with the use of e-waste, they will know how to better handle them.¡±

He told Joy news that the used computers contain lead and other toxic materials which are unfavourable to the environment, but hinted that government is considering relocating people already in the business.

Asked whether government is considering a ban on the importation of e-waste, the minister said ¡°when it becomes necessary, government will take a decision¡±

With the drive towards embracing the era of Information technology, Adjei Darko said government will not rush into banning the importation, since that will also have effects on the prices of computers in the country.

He said the phenomenon is an international issue and needed the cooperation of all governments to put an end to the practice.

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The country¡¯s steel export in the April-July period of the current year dipped about 25 per cent to 2.75 million tonnes due to the export duty imposed by the government in May.

However, import during the same period has jumped over 20 per cent to 3.5 million tonnes. Accordingly, this has helped in increasing the domestic steel supplies by nearly 1.5 million tonnes.

BENDING DOWN

Finished steel production in Q1 (April-June)

Period In '000 tonnes % growth

2000-01 7,508 12.18

2001-02 7,430 -1.04

2002-03 7,916 6.54

2003-04 8,430 6.49

2004-05 9,387 11.35

2005-06 10,159 8.22

2006-07 11,599 14.17

2007-08 12,226 5.41

2008-09 12,777 4.51

Finished (carbon) steel production grew by 4.51 per cent during

the first quarter of 2008-09 to touch 12.7 million tonnes.

Finished steel has a weightage of 5.13 per cent in the index of industrial production

Source: Ministry of Steel/PTI

¡°The improved domestic availability owing to a dip in export is a positive development and it has helped the consumer industries,¡± said steel secretary P K Rastogi. Steel export stood at 5 million tonnes in 2007-08 while import was 6.9 million tonnes. For the first time in 2007-08, the country became a net importer of the commodity as demand outstripped supply.

On May 10, the Government had notified export duty on steel and steel products ranging from 5 per cent to 15 per cent. About a month later, it decided to withdraw the duty on flat products while raising the duty on long products such as bars, rods and angles from 10 to 15 per cent. Earlier this year, it had brought down the import duty on steel from 5 per cent to nil.

¡°Steel companies had decided to control export on government¡¯s request so that domestic availability is augmented. This is having a positive impact on the domestic consumption though we have lost the opportunity to take advantage of better price realisation internationally,¡± said Jayant Acharya, president (sales and marketing), JSW, country¡¯s third biggest steel producer and a major exporter.

The export duty was imposed to boost domestic availability and check prices. Steel along with iron has a weight of 3.64 per cent in the wholesale price index (WPI) and has been a major contributor in driving inflation to double digits. The WPI-based inflation for the week ended August 9 stood at a 16-year high of 12.63 per cent.

Flat steel product prices had jumped 17 to 24 per cent since April 2007 while long products like bars and rounds have appreciated 50 to 60 per cent over the same period. In May, the government persuaded steel producers to hold prices for a three-month period. Companies, however, have continued the freeze even beyond this period to help government fight inflation.

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The price of aluminum in the Kingdom has reached SR11,962 ($3,190) per ton ?an increase of 70 percent ?due to fluctuations in demand and supply, dealers said.

Khaled Al-Bilbeesi, director of marketing at the National Aluminum Manufacturing Company (NAMC), said the price of aluminum has hardly been affected by price fluctuations in the past 10 years.

"It is only during the last two years, specifically the past year, that prices have witnessed a remarkable rise of more than 70 percent taking the price of a ton to $3,190," he added.

Al-Bilbeesi attributed the increase to fluctuations in demand and supply, and speculations in the international markets. He added that the increase is not in the interest of companies and that the Saudi market is still in a better position than neighboring countries.

He added that prices had come down to $2,819 three months ago before rising to their current level. He, however, did not expect prices to reach $4,000 in any case.

According to Al-Bilbeesi, the increase has not affected demand, which continues to grow, especially in the summer. "The selling season starts at the beginning of the year, continues until August, comes down between Ramadan and Dhul Hijjah, but never reaches complete stagnation," he said.

He added that he does not believe aluminum would be replaced with other alternative substances such as PVC "because Saudis prefer aluminum."

Al-Bilbeesi said aluminum constituted between 8 to 10 percent of each construction project. He described the metal to be resistant to difficult weather conditions, lightweight, not affected by humidity or high heat, durable and long lasting. "It is being used widely in the fade of glass buildings in the Kingdom," he added.

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Association of Primary Aluminium Producers of Nigeria has warned property owners not to be carried away by fancy roofing sheets, because they might be fake.

They spoke in Abuja, yesterday evening, when members of the body, comprising notable names like First Aluminium Products, Tower Aluminium and Nigerlex, paid a visit to Minister of State for Mines and Steel Development, Alhaji Ahmed Gusau.

Alleging the dumping of cheap and substandard products from India, China and other Asian countries, because of the tariff structure, leader of the Association, and Managing Director of Nigerlex, Walter Fetzer, said the genuine indigenous aluminium producers were being asphyxiated out of business.

Fetzer, who likened the situation of the 15-member association to that of the textile industry, said should they be pushed out of business, about 25,000 workers made up of 5,800 direct employees, and 18,000 indirect ones, would be forced to join the labour market.

He said to make matters worse, most contractors use fake letterheads of genuine aluminium roofing sheets manufacturers, quote their prices, but end up supplying very thin roofing sheets that stand the risk of being blown off at the slightest windstorm.

"Contractors give quotations from major aluminium companies like us, use our letterheads but give you substandard roofing sheets. We have been confronted with situations like this and we have been able to prove that they did not emanate from us. We are working with Standards Organisation of Nigeria(SON) on this. Our immediate threat is that we are being wiped out," he said.

The group noted that Aluminium Smelter Company of Nigeria, (ALSCON), at Ikot Abasi, which should have supplied genuine producers with ingots, export all of their produce, at the detriment of local rolling mills that have to import the raw materials at cut-throat prices.

They, therefore, asked to be granted the same concessions that the steel industry enjoys.

"ALSCON is our future, but it exports its products 100 per cent," he said, and asked the minister to prevail oo it to consider feeding the home market before exporting.

Gusau assured them that government would do something about their plight, saying: "we have the duty to protect you."

He announced that a regulation was being put in place and that when the draft was ready, the aluminium manufacturers would be asked to make their input. Gusau lamented that Nigeria imports 800 metric tonnes of aluminium flat sheets per annum.

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It is reported that steel market maintains modest downswings in recent days and steelmakers suffer greater pressure from fund and cost. Most steelmakers beat down purchase prices for ore fines and seldom take mass purchasing.

On the other hand, given few transactions, miners are not so confident in future market. Though supply and demand sides are still in stalemate, miners are increasingly likely to compromise, in view of decreasing purchase prices and still huge profits at current prices.

Steelmakers will face bitterer situation in the coming days and iron ore fine demand may slump. Due to weak steel demand, steel traders report difficult sales and huge stocks, which press steelmakers. Against such a backdrop, most steelmakers in Tangshan will gradually step into production suspension before mid Sep. large amounts of steel stocks indicate even if steel market turns better demand for iron ore will not revive in a short term.

Besides, both spot price and futures price have dropped dramatically owing to shrinking demand. Price for imported iron ore is at least CNY 150 per tonne lower than that for home one, hence sliding imported ore price severely impacts domestic ore price. In the meanwhile imported iron ore supply keeps sufficient. As a result, even steelmakers expand purchasing, they will seek imported resources. This will further embarrass domestic ore and home ore price can barely remain at current level. Moreover, continuous price beats and dull demand have weakened miners' confidence. Miners may fear their profits will decrease as prices nose down. Some are anxious to undersell resources to cash out.

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The summer months are typically the slowest of the year for the non-ferrous business, and while there was some degree of a downward trend in demand from many parts of the world, we certainly had the markets' volatility to keep us awake. Many claim the commodities bubble has burst; others maintain that we still haven't seen the highs in some of the metals in which we deal. And as usual, everyone has his or her own reasons for establishing an opinion. Chief among them, as is often the case, are the economic dynamics of the day and the oft-held belief that fundamentals eventually establish market value.

As we approach our Autumn Roundtables in D¨sseldorf in October, thoughts of the economic situation in the so-called "mature" nations of the world will still be at the forefront. To this end, we're planning a program that will focus on the economy's impact on non-ferrous markets and how it is affecting demand for and pricing of our scrap. We believe that this subject is of major concern to our members, and we look forward to hearing what our speakers have to say, and of course to your reactions as well.

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China Securities Journal reported that spot iron ore price might plunge in October following steel output cutback and domestic ore production surge. In fact, imported ore stockpiles at Chinese seaports have stayed above 60 million tonnes for over five straight months and the market price has already shown sign of softening in recent days.

Mr Yang Siming GM of Nanjing Iron & Steel United Co at a recent conference in Xiamen said that iron ore and coke prices are sky high. Coke price has already retreated recently, but iron ore price has yet to see remarkable downward corrections. Steel mills are to step up output cutback in September which would give a heavy blow to spot ore market in October.

Mr Liu Zhimei senior official of CCCMC said ore stockpiles at seaports has hit a record high at 67.55 million tonnes in August however; the steep price has contributed to thin trade and slow off take at the ports.

Domestic traders are in no rush to strike deals at the moment, while the buyers are mostly sitting on the fence. Currently, slipping freight rates has weighed on domestic spot ore price.

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China's top 20 aluminum smelters, the largest in the world, have cut production by more than 350,000 metric tons on an annual basis as part of a July agreement to reduce energy consumption and boost prices, China's Nonferrous Metals Industry Association said.

The companies took production offline between July 10 and Aug. 10 as smelting became increasingly unprofitable because of higher costs, Wen Xianjun, vice chairman of the association, said in an interview. The reduction is equivalent to roughly 2.8 percent of the nation's production last year of 12.6 million tons, according to Bloomberg calculations.

Aluminum Corp. of China Ltd. and 19 of its peers signed an accord in July to reduce production by as much as 10 percent until the end of the year because of power shortages. Aluminum prices have tumbled 20 percent from a July record of $3,380.15 a ton on the London Metal Exchange because a spreading global economic slowdown may crimp demand for industrial commodities.

"The industry will face a tougher situation in coming months," Wen said. Smelters such as Qingtongxia Aluminum Group "are beginning to become unprofitable because of rising costs," Wen said.

Alumina production capacity has also been reduced by 2 million to 3 million tons because of overcapacity and falling prices, Lang Dazhan, deputy head of the association's aluminum division, said in a separate interview today. Alumina is a raw material that is smelted into aluminum.

Prices for aluminum in China, the world's largest producer, have dropped below the output costs of many smelters, which may force more production cuts in winter as smelters have to switch to more expensive coal-fired power from hydro-electricity, JPMorgan Chase & Co. said Sept. 3.

Aluminum Corp. of China's Shanxi venture, Shanxi Huaze Aluminum & Power Co., has closed 80 pots or 30 percent of the company's 280,000 ton capacity and Qingtongxia Aluminum Group hasn't restarted smelters that were halted for maintenance, Lang said.

Calls to Aluminum Corp., also known as Chalco, and Qingtongxia were not immediately answered.

Chalco's chairman Xiao Yaqing last week said prices face "downward" pressure in the second half because of oversupply and slowing demand growth.

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Mr LN Mittal CEO and chairman of ArcelorMittal, who received the Malcolm S Forbes Lifetime Achievement Award, believes that despite the slowdown, the global steel market will continue to grow at 3% to 5% per annum.

Mr Mittal at the Forbes Global CEO Conference gala dinner in Singapore said that ¡°The demand in China will make up for the slack in growth in the US, Europe and Japan. China makes up one third of the world demand. There will be 221 cities by 2025 and they will need 40,000 to 50,000 skyscrapers.¡±

He said that ¡°All these will be made of steel and it gives me confidence that the demand will grow albeit not at double digits.¡±

He added that demand from India would also come from the small to medium industries.

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It is reported that China's export of finished steel products surged to 7.68 million tonnes in August, setting a fresh all time high after hitting 7.21 million tonnes in Jul up by 6.5% MoM.

Reliable industry source told Mysteel that China also imported some 1.33 million tonnes of finished steel products and 37 million tonnes of iron ore in the same month.

All figures above are still subject to official confirmation by the China customs, which usually releases monthly trade results around 10th of each month.

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Police in Ohio are about to get help in trying to crackdown on scrap metal thieves who steal aluminum siding off houses and copper wiring from basements.

Scrap metal sellers will be required to show a photo ID beginning Thursday and must prove that they own items such as guard rails and beer kegs. State lawmakers set the requirements to slow a wave of metal thefts brought on by climbing metal prices.

"We're hoping its going to clean up the industry," said Ted Altfeld, president of Bluestar Metal Recycling in Elyria. "If everybody is playing by the same rules, I feel a lot better."

Thieves no longer are content to steal metal pipes and radiators out of vacant homes. They've swiped railroad tracks in southwest Ohio, an air conditioner unit from atop a police union hall in Toledo and catalytic converters from cars parked in downtown Cincinnati.

A year ago, a northeast Ohio man was electrocuted while trying to steal copper from a power substation.

No one expects that new state law will completely stop the thefts.

But it will give police a place to turn for information; scrap yards will be required to keep a log of who brings in metal to sell. And it will create statewide standards, stopping thieves from taking metal into towns where there are no rules.

Many scrap yards already required a photo ID.

Altfeld said his employees watch closely what people bring and will alert police if they're suspicious.

"We've had a number of people taken away in handcuffs from here," Altfeld said.

How well the law works will depend on whether it is enforced across the state, said Josh Joseph, vice president of Muskingum Iron and Metal in Zanesville.

The problem is that scrap metal is easy to move.

"The criminals that are stealing this are smart enough to know where they get rid of the metal," Joseph said.

Dayton has required scrap yards to keep detailed records about the customers they buy from since 2006. The information has been a tremendous help, said detective Jamie Bullens, who investigates scrap metal crimes.

Scrap dealers work closely with police and let them know when they hear about operators willing to buy stolen items, Bullens said.

The state law is "going to give law enforcement agencies a little bit bigger bite," he said.

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Industrial metals were hammered on Monday as investors dumped positions to seek refuge in safer assets after Lehman Brothers filed for bankruptcy.

Aluminium sank more than three percent to its lowest since end-January, copper neared its eigh-month low while zinc plummeted almost 10 percent at one point. Nickel fell to its lowest in more than a month. Copper for delivery in three months on the London Metal Exchange was at $6,820 per tonne in the open outcry trade, down $302 from Friday¡¯s close of $7,122 per tonne.

Metals markets were already under pressure after copper and aluminium touched record highs earlier this year. Aluminium lost $93 to $2,572 per tonne while nickel fell to $18,000/18,005 per tonne from $19,250 on Friday. Tin slipped to $18,500 per tonne from $19,450 while lead shed $130 to $1,810 and zinc slipped $155 to $1,730.

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Despite the unabated fall in raw material costs, steel prices rebounded in the physical market with ingot prices rising 5 per cent in the last fortnight. Currently quoted at Rs 35,700 a tonne in Punjab¡¯s Mandi Gobindgarh, India¡¯s largest steel selling market yard, ingot jumped sharply from Rs 34,000 a tonne early this month on healthy resumption in post-monsoon demand.

Anil Suraj, a ferrous metal analyst in Mandi Gobindgarh, believes that the current spat of demand would support the steel prices to rise further between 10-15 per cent next month. Following suit, other varieties also jumped 5-10 per cent.

The prices of hot rolled (HR) coil and HR sheet were at Rs 44,220 a tonne and Rs 43,520 a tonne respectively while cold rolled (CR) coil and CR sheet are currently prevailing at Rs 48,400 a tonne and Rs 48,500 a tonne respectively. Similarly, billet also perked up to Rs 43,500 a tonne against Rs 41,500 a tonne a fortnight ago.

Demand for all the steel products including construction, flat and long steel was dull during rainy season between June-August which suddenly resumed in September.

Long products, like bars, plates are in high demand, and are sold with a 5-10 per cent premium to the current price of Rs 43,500 a tonne (5 - 10 mm plate). Primary producers of these products already have advance orders for four months.

Specialised steel is always in demand in India and is currently an import substitute. Hence, even government does not intervene in the price movement of such steel products. Apparently, all major primary steel producers, produce specialised long and flat products to sell at a premium constituting slightly above 10 per cent of India¡¯s total steel output of 52 million tonnes.

¡°It is difficult to say that steel prices would increase further especially in the wake of falling input costs including metallurgical coke (met coke), pig iron etc,¡± said Nitin Johri, chief financial officer of Bhushan Steel. According to N Mohapatra of KIC Metaliks, a pig iron producer, met coke prices have fallen marginally by $50 to $800 while iron ore remained rangebound at Rs 5,500 a tonne in the last one month.

Poor demand from China softened 23 per cent during the period on China¡¯s dis-interest in resuming operations on closed steel units due to weak global sentiment. Pig iron, the valued raw material for steelmaking, is currently quoted at Rs 27,000 a tonne from Rs 35,000 a tonne a month ago.

Another secondary steel producer, Suresh Kumar Bhuwalka, MD, Bhuwalka Steels Industries was quick to comment that steel prices are unlikely to go further up as scrap prices are falling globally. Steel scrap slumped $125 to $475 in a month on weak global demand.

¡°Chinese demand was expected to begin this month post-Olympic Games. But, the impact of Games is still continuing. As long as Chinese demand continues to remain under pressure, the impasse for pig iron producer would not waive,¡± said Mohapatra. To make met coke costlier, China levied 15 per cent additional duty to the existing 25 per cent export duty on met coke, a key ingredient of pig iron, which India imports.

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FIVE Chinese steel mills have revealed plans to cut production by up to 20 per cent over October.

Evidence has emerged that real-economy stresses are being created in emerging markets by the Western credit crisis.

The prospect of wide-ranging and unexpectedly deep cuts in Chinese steel production have surprised Australia's major iron ore and coal producers and fed fears that China is more closely "coupled" to the global economy than anyone has wanted to believe.

While confidence in China's medium and long-term economic prospects remains very strong, there are fears of a material drift in demand for Australia's key raw materials over coming months.

As the leaders of the western economic world bashed our rescue packages -- which many now maintain could prove the turning point in the swirling financial crisis -- four of China's domestic steel producers were reported to have instituted production cuts of 20 per cent in the hope of driving a recovery of steel prices.

As that prospect was being digested by Australian iron ore exporters, Reuters started carrying reports that China's biggest steelmaker, the mighty Baosteel, was going to follow the juniors' lead and reduce output by a million tonnes, or nearly 10 per cent, over the next quarter.

Just a month ago, speculation about material cuts in China's December quarter steel production would be have been greeted with considerable and justified scepticism by our iron ore miners.

Back then there was a view that, while the September-October numbers might be below trend, China's economy would ramp up very quickly after theOlympic induced capacity shutdown.

Only two weeks ago the president of BHP Billiton's China operations, Clinton Dines, delivered a series of investor briefings in Sydney in which he emphasised the resilience of China's domestic economy.

The Dines thesis is that China is less dependent on export markets than many believe, that core raw materials demand is driven by domestic infrastructure investment, which is funded by private savings rather than imported capital. So, China will be resilient in the face of external frailty.

That all sounded OK until Mt Gibson revealed last week that some customers had asked for delays to iron ore deliveries.

Mind you, there was comment even then that China was merely indulging in a little bit of price negotiation theatre. Revelations by Fortescue yesterday that some of its September revenues has been recorded as debt in its quarterly cash statement will reinforce worries creeping through the mining sector.

Fortescue's issue is that "cash has not yet been received from confirmed bank letters of credit". And that would seem to indicate some of its customers are having trouble getting their hands on the US dollars necessary to support their credit lines.

If that is the case, Fortescue's customers are not alone. Around the globe, the deep freeze in capital markets is constraining the normal processes of business, be it securing currency swaps, raising commercial paper funding or securing interbank lending.

The thing is though we thought China might well be immune from these problems. It is not.

That said, it would seem that, for strategic and political reasons, Fortescue is unlikely to feel the brunt of any production cuts. Its status as the new force in iron ore is treated most seriously in China and it is expected to remain a supplier of choice for that reason.

Similarly, BHP's determination to meet all its contract requirements rather than use loopholes to shift tonnage into spot markets is likely to see it rewarded.

But there are rumours in the market that Brazil's Vale could well lose tonnage in the wake of its ill-timed attempt to win mid-year price hike of up to 12 per cent. And there is speculation, too, that Rio Tinto, which has played contract hardball and sold tonnage into the spot markets, might yet pay a price.

Needless to say, there is irony aplenty in what is a broadly coordinated cutback in Chinese steel output and that its stated aim is to manipulate higher domestic steel prices prices -- remember China Inc objects to BHP's takeover of Rio on the ground of market power.

Credit is due

THE the first thing to observe about the weekend's concert of government intervention in the global banking system is that it has been received extremely positively here and around Asia.

Confidence, or its utter destruction, is an elemental force driving the now terrifying erosion of the global financial system.

So, yesterday's relatively exuberant welcome to this extraordinary government intrusion into the workings of capital markets is, of itself, a potential means to an end.

The hope is that the cohesive but purpose built collection of plans to rehabilitate banking systems across the globe will set a foundation first for stability and then, more distantly, for recovery.

The second thing to note is that, give credit where it is due, the federal Government's decision to guarantee all bank deposits is as brave and unprecedented as it is correct.

And it is also a portent of the potential of this crisis to yet rip a black hole into our financial infrastructure.

As the nature of the threat to the international financial system became dreadfully apparent through 2008, Australians have been well served by its government and regulators.

Yes, this latest jump into the unknown flies in the face of 30 years of financial market deregulation and it has the free-marketeers pondering the principles of moral hazard and the idea that failure is essential to a thriving economy.

There are valid questions raised, too, about the duration of the Rudd Government's guarantee and how and when the banks and their customers will be weaned off their comforting new security blanket.

And, anyway, haven't the banks, regulators and government been telling us for the past 12 months that our banking pillars are well capitalised, well-operated and prudently provisioned? So why is the guarantee necessary?

Fair points all. And the Rudd Government has been expedient in ignoring them and opting instead to protect the effective operation of our financial system ahead of the crisis which would make this policy necessary.

The problem for government, regulators and industry alike is that pretty much no one has been able to accurately anticipate the path of this creeping crisis.

There is a view that with the US, Britain and Europe either partially nationalising or directly underwriting their banking systems, Australia had little choice but to match the guarantees now implicit in those banking markets. There are two very practical roots to this view.

One is a fear of the sort of capital flight, which has been seen in Europe when retail deposits have been shifted from un-secured banking markets to those where deposits have been guaranteed.

The other is that our four well-managed members of the world's rapidly diminishing class of AA banks would unfairly lose their competitive advantage in sclerotic term funding markets, as the now government-backed, recapitalised Euro-banks go looking for funding.

Ultimately, though, the big issue in banking is that trust is dead. As banks have been left insolvent by losses in the withering trans-Atlantic property markets, faith in the broad system has evaporated and resulting credit-freeze has left economies around the globe in a collective suspended animation.

The illiquidity of the banks only further undermined the already fragile economies of the US, Britain and Europe.

And now even the economies of robust outposts of the OECD, like Australia, are being sabotaged, as the developing nations driving our prosperity start coming to terms with the reality that they remain as coupled to the world as ever they were.

The final point here is that, as one leading banker said yesterday: "Even the Europeans have now recognised that the problem is their's, as well, and that their inaction is amplifying the danger. Now everyone is doing their best to deal with all four areas of the banks' issues, liabilities, assets, capitalisation and funding.

"So really, if this doesn't work, then what will?"

And that is a scary thought indeed.

information from worldscrap.com ■

With the approaching of the iron ore negotiation, it becomes expecting whether domestic steel enterprises could break through the restrictions from international iron ore giants. What worries steel industry is that under the circumstances of global economic slowdown, high-costs and low downstream demands, the potential risks and difficulties in profit making become intensified in steel industry. Therefore, the reorganization and industrial concentration of has become a new focus in steel industry.

Statistic data from China Iron and Steel Association (CISA) showed that in Jan.-Aug., production costs of domestic steel enterprises soared 60pc, while domestic steel prices started plunging since July with demand decline continued. By October, over 60pc of large and medium steel enterprises were in profit losses, while the deficit had reached 1.154 billion Yuan in Jan.-Sept. this year, 18.06 times up over the same period last year. As the steel production capacity exceeds that of the demand, steel enterprises with poor management will be forced to shut down or restructured and only by the reorganization with enterprises that have secured resources, advanced technology and equipment and stable market could they get rid of the eliminated destiny.

An official from State-owned Assets Supervision and Administration Commission (SASCC) expressed the same opinion “The time for the survival of the fittest in steel industry has arrived. The reorganization by the government promoted little as steel industry was always in fine condition. But now the market will show its huge power. From metalbiz.com

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In recent one week, in Shangshai and its surrounding market, construction steel demand, such as deformed bar (debar) and wire rod seems appearing an operating situation of reconditioning and price comeback, the exchange becomes more active than previously, traders’ sales soars to some extent and hold an optimistic view on latter market, however, some uneasiness still lurks in some operators’ mind.

Liang Taigeng, the general manager of Shangshai Hualei Enterprise Development Co., Ltd expressed that debar price still had a fluctuant and rebounding process within this year, so it was difficult to apparently jump.

According to the market investigation from Shangshai Hualei, debar price in Shangshai market began to rebound from the bottom when entering mid-November after suffering a continuous fluctuation and comeback, and slightly fell back this week and was generally higher than that in Beijing and Tianjin market, from chinametalbiz.com.

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According to latest figures from National Bureau of Statistics of China, China's crude steel production for October 2008 dropped by 17% YoY to 35.9 million tonnes. Crude steel output for the first 10 months of 2008, however, totaled 427.29 million tonnes, up by 3.9% YoY.

Steel products output for October 2008 reached 42.93 million tonnes, down by 12.4% YoY. Steel products output over January to October 2008 totaled 487.91 million tonnes, up by 5.9% YoY.

China also produced 34.13 million tonnes of pig iron in October 2008, down by 16.8% YoY. Pig iron production in the 10 month period totaled 399.48 million tonnes, up by 2.5% YoY.

In October 2008, China produced 67.85 million tonnes of iron ore, up by 12.5% YoY. The country's total iron ore output for January to October 2008 period was 654.18 million tonnes, up by 18.8% YoY.

Meanwhile, China produced 730,300 units of automobiles in October 2008, down by 0.7% YoY. China produced 8.22 million units of automobiles in January to October 2008 period, up by 12.4% YoY.

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