July 2014 Edition Vol. 1 Issue 2

STEEL DIGITAL MAG 2014

Find Out What’s Brewing For The Steel Industry On Page 2 Onwards ->

Creating Greater Value ~ Advance SCT

Advance SCT Limited has evolved from being a

recycler of metals to becoming a global supply chain

manager of natural resources.

It owns and operates wastewater treatment facilities,

produces copper-based products for the electronic and

power industries, and has investments in mining and

metal processing technologies. Leveraging on its

expertise and exposure in the metal industry, the

Company aims to turn itself into a major resource-based

company in the world.

Advance SCT Limited has been listed on the main

board of the Singapore Exchange since 24 November

2004. --------------------------------------------------------------------------------

新亞控股集團是一家知名的銅製品供應商，主要工廠設置於中

國大陸南 部以及台灣地區。本集團在電子材料設計製造亦處於

本地區領先水平。同時，本公司已與歐洲金屬加工公司締結戰略

聯盟，著手研發高科技附 加值的新一代熱交換器系統。該產品

的問世將對傳統的熱交換器市場產 生巨大的衝擊。

在生產和研發銅製品之外，公司亦著眼於開發其他的可利用資

源，位於 中國南部的污水處理中心便是公司尋求轉變的顯著標

誌。該中心設立的 目的便是改善當前金屬行業的弊端，使本公

司真正成為一個世界知名的 資源節約型集團。

新亞集團於 2004 年 11 月 24 日起在新加坡證券交易所主板上

市。

Steel Industry Demands Easing

Of Duty On Scrap Imports

(With new policies likely to raise demand,

ore mining restriction an issue)

Dilip Kumar Jha | Mumbai

July 7, 2014

With Transport Minister Nitin Gadkari proposing to

gamer Rs 100,000 crore for the development of

highways into two years, steel mills are expecting a

revival in demand. The scrap imports is likely to pick up

as the country is not producing enough ore to meet the

demand.

The steel sector is demanding easing of duty on scrap

import.

Import had fallen last year. Fears of ore prices

shooting up due to rising steel demand may not hold

true as sources said rising scrap import will help check

ore prices. The latter have declined by 28 per cent this

year to trade at $96.5 a tonne for delivery in China.

Read more @ link : http://www.business-

standard.com/article/markets/steel-industry-demands-

easing-of-duty-on-scrap-imports-114070701206_1.html

China, Taiwan Face EU

– Tariff Threat On Stainless Steel

The European Union threatened to impose tariffs on stainless

steel from China and Taiwan to curb competition for EU

producers including ArcelorMittal (MT) and ThyssenKrupp

AG.

The EU began an inquiry into whether Chinese and

Taiwanese exporters of cold-rolled flat products sold them in

the bloc’s 5.5 billion-euro ($7.5 billion) market below cost, a

practice known as dumping. This kind of steel is used in

everything from cars and tanks to boilers and kitchen

equipment.

The investigation will determine whether the steel “is being

dumped and whether the dumped imports have caused

injury,” the European Commission, the EU’s executive arm in

Brussels, said today in the Official Journal. The commission

has nine months to decide whether to impose provisional anti-

dumping duties for half a year and 15 months to decide

whether to apply “definitive” levies for five years.

The investigation may revive EU-China trade tensions over

steel more than five years after European producers

complained that Chinese competitors had dumped a range of

goods inEurope, prompting a series of dumping inquiries. One

of those probes covered stainless steel cold-rolled flat products

and was closed in 2009 without the imposition of EU anti-

dumping duties.

The probe announced today stems from a May 13 complaint

by European steel industry group Eurofer on behalf of

producers that account for more than a quarter of the EU’s

output of stainless steel cold-rolled flat products, according to

the commission.

Brussels-based Eurofer hailed the new investigation, saying

in a statement that European imports of stainless steel cold-

rolled flat products from China and Taiwan rose at an

“alarming rate” last year and unfairly undercut EU

manufacturers.

The two countries’ combined share of the EU market

exceeded 14 percent in April this year and the dumping margin

was 20 percent, according to Eurofer, which cited overcapacity

in China and Taiwan.

“This is no longer sustainable,” said Eurofer Director

General Gordon Moffat. He accused Chinese exporters of

“flooding the markets which are still unprotected like the EU.”

The EU market for stainless steel cold-rolled flat products in

2013 was worth about 5.5 billion euros, of which imports from

China and Taiwan were valued at 620 million euros, according

to Eurofer. Total EU imports of this steel last year were worth

about 1.5 billion euros, Eurofer said.

In volume terms, the EU market in 2013 was 3.4 million

metric tons, of which 318,000 tons were imports from China

and Taiwan, according to Eurofer.

Top Steelmakers Profit Boosted By

Cheaper Coal : Corporate India By Abhishek Shanker and Rajesh Kumar Singh

Photographer: Sanjit Das/Bloomberg

India’s steelmakers are set for a rebound. Falling fuel costs

just as a new government promises to revive demand growth

from the slowest pace in five years are burnishing their

earnings outlook.

Contract prices of cooking coal, used to fire furnaces, may

drop 7 percent to about $112 a metric ton next quarter from the

three months through June, according to the average of

estimates compiled by Bloomberg from eight industry

executives and analysts. Spot prices have tumbled 17 percent

this year as demand in China shrank and Australian supplies

increased.

At least three of 13 analysts have raised earnings estimates

for Tata Steel Ltd. (TATA), Steel Authority of India

Ltd. and JSW Steel Ltd. (JSTL), according to data compiled by

Bloomberg. Though the producers have struggled to boost

profit margins from near a decade-low as an economic slump

crimped demand, their shares have outperformed the

benchmark index this year on Prime Minister Narendra Modi’s

pledge to build 100 cities and rekindle stalled projects.

“We expect coking coal contract prices to drop,” JSW’s Group

Financial Officer Seshagiri Rao said in an interview. “Business

sentiment is upbeat and construction has picked up well, which

means we are selling more and are also able to raise prices.”

Relying on Imports

Coking coal is scarce in India, with the biggest mine in the

eastern state of Jharkhand trapped in a century-old

underground fire. India imports about 65 percent of its coking

coal requirement, with the top three steelmakers accounting for

half of the purchases. State-owned Steel Authority, the biggest

importer, uses the shipments to meet 70 percent of its needs.

China’s efforts to cut pollution coupled with an overcapacity

in sea-borne coking coal will weigh on prices of the commodity,

saidHelen Lau, a Hong Kong-based analyst at UOB Kay Hian

Ltd. The world’s biggest consumer is also planning to reduce a

steel capacity glut, estimated at 210 million tons, according to

Bloomberg Industries analysts Zhuo Zhang and Kenneth

Hoffman.

Demand for the alloy in India may rise at least 4.5 percent in

the 12 months ending March 31, rebounding from less than 1

percent last year, the smallest since 2009, fueled by construction

and automobiles, according to Jayant Acharya, director at JSW Steel.

Peeyush Gupta, vice president at Tata Steel, estimated 5 percent in a

newsletter last month.

Better Estimates

“The July-September period may be one of the best quarters

for Indian steel companies as alloy prices remain high and costs

for buying coking coal fall,” said Giriraj Daga, analyst at

Mumbai-based Nirmal Bang Equities Pvt. “There can be

positive surprises.”

The forecast for Tata Steel’s group net income for the current

financial year was raised by six of 13 analysts who updated

their projections this month, according to estimates compiled

by Bloomberg. ICICI Securities Ltd.’s Abhijit Mitra was the

most bullish, lifting his forecast by 46 percent to 40 billion

rupees.

For JSW Steel, five of 12 analysts increased profit estimates,

with Nirmal Bang’s Daga elevating his by 32 percent to 31.7

billion rupees, while three of 10 Steel Authority

(SAIL) analysts raised net income projections. Motilal Oswal

Securities Ltd.’s Sanjay Jain boosted his forecast by 12 percent

to 31.9 billion rupees.

Share Rally

New Delhi-based Steel Authority declined 1.4 percent to 92.95

rupees in Mumbai. Tata Steel retreated 1 percent to 525.80

rupees, and JSW Steel also fell 1 percent to 1,221.90 rupees, in

line with the drop in the benchmark S&P BSE Sensex.

(SENSEX)

Also leading gains in the $1.5 trillion stock market are India’s

utilities, banks and builders as investors bet Modi will clear the

investment backlog after taking power last month.

The rally may extend as Modi’s policies lead to higher

corporate earnings and fewer bad loans at lenders, Rohit

Singhania, who runs the BlackRock Inc’s the DSP BlackRock

India T.I.G.E.R. Fund, which invests in shares of nation’s

infrastructure companies, said in an interview on June 12.

Operating profit margins are set to improve after the key

gauge of profitability narrowed in the 12 months to March 2013

to the least in 10 years for Tata Steel, smallest in 11 years for

Steel Authority and to the worst since at least 2007 for JSW,

according to data compiled by Bloomberg.

Consumer Spending

The profit margin at Tata Steel’s Indian operations may

expand to 38 percent this financial year from 26 percent, while

Steel Authority may see it doubling to 10 percent from 5.2

percent and JSW Steel’s at 13.65 percent versus 11.87 percent,

according to the estimates compiled by Bloomberg.

Prime Minister Modi has vowed to build 100 new cities,

provide houses to all citizens by 2022, introduce high-speed

trains and low-cost airports connecting smaller towns, as he

seeks to revive economic growth from a decade low.

A rebound in growth may also increase consumer spending,

spurring vehicle sales, said A.S. Firoz, chief economist at the

federal steel ministry. Maruti Suzuki India Ltd., the nation’s

biggest carmaker, reported a 19 percent increase in May deliveries,

the best in nine months after the industry survived the worst slump in a

decade.

“The thrust of the government is to improve infrastructure

and boost economic growth,” Firoz said by phone in New

Delhi. “A natural consequence of an improving economy is a

rise in consumption. All of that is great news for the steel

industry.”

To contact the reporters on this story: Abhishek Shanker in

Mumbai atashanker1@bloomberg.net; Rajesh Kumar Singh in

New Delhi atrsingh133@bloomberg.net

To contact the editors responsible for this story: Jason Rogers

at jrogers73@bloomberg.netIndranil Ghosh, Abhay Singh

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