ISSB News - Chinese steel production in March 2016

The Iron & Steel Statistics Bureau today comment as follows on Chinese steel production levels in March 2016.

“The decline in Chinese domestic demand for steel has been well documented and there had been reports in the press of government plans to cut some of the older, more polluting capacity and to reduce annual production by around 150 million tonnes in five years. There has been very little evidence of any progress being made in this regard, however, as although Chinese production fell by 3% year on year in the first quarter, the traditionally strong month of March actually saw production increase by 1% to 70.7 million tonnes which, incredibly, represents the highest ever monthly production figure from the country”.

To read more visit http://www.issb.co.uk or visit our website at http://www.steelonthenet.com for other news.

Andrzej M Kotas

Liberty House completes acquisition of steel mills

Statement from Liberty House regarding the steel plate works at Dalzell and Clydebridge

Liberty House has completed its acquisition of the former Tata Steel plate making facilities at Dalzell and Clydebridge in Lanarkshire.

The deal involved a back-to-back transaction in which the Scottish Government acquired the two plants from Tata Steel and immediately sold them to Liberty House.

Sanjeev Gupta, executive chairman of Liberty House said: “We’re very pleased to announce that we have completed the deal to acquire Tata’s plate mills in Scotland and we now look forward to continuing to work with local management and the workforce to re-build these great businesses in the months ahead. We’re very grateful for the valuable support of the Scottish Government and the trade unions in concluding this deal. Our team are continuing to evaluate the opportunity to make a bid for other Tata UK assets.”

Commenting First Minister Nicola Sturgeon said: “I am delighted that the final details of the deal to transfer the Scottish steel plants is now concluded and implemented. We are very grateful to Liberty for their foresight in coming forward to take up this exciting opportunity in Scotland and for the energetic and speedy manner in which they worked with the Scottish Government to help save these jobs. We look forward to working very closely with them in the future.

“When we convened the Scottish Steel Taskforce back in October we did so with a determination not to stand by and watch these plants close, but to do everything possible to secure a new operator, and to do whatever we could to make the plants an attractive proposition. I am delighted that that approach has proved successful.”

 Scottish Business Minister, Fergus Ewing, who chaired the Scottish Steel Taskforce, said: “I was pleased to update the House of Commons Select Committee on this exciting news for the Scottish steel industry when I gave evidence to their inquiry this morning.

 “Over the course of eight taskforce meetings and a lot of other engagement we made significant progress in five key areas to support the industry, namely business rates, energy costs, environmental issues, skills and procurement.  It has been a team effort which has paid off and once again the steelworkers of Scotland will produce world class products from Lanarkshire.

 "The individuals who worked for us from the Scottish Government, Scottish Enterprise, Skills Development Scotland and SEPA were outstanding in their effort and commitment to the task before us.  I am truly grateful to all these public servants for their work, as well as to the local trades union reps and the management”

ENDS

Further information from Eoghan Mortell on 07977 555116

Note to Editors

About Liberty House Group

Liberty House Group is an international business, specialising in metals trading and the manufacture and distribution of steel and advanced engineering products. Operating from four strategically-positioned hubs in London, Dubai, Singapore and Hong Kong, the Group has a network of operations spread across 30 countries. The Group is focused on creating a sustainable, balanced international business that is non-cyclical, environmentally conscious and socially responsible, and has an integrated and agile business model.

blogger@steelonthenet.com

Financing the future of British steelmaking assets

A number of press reports are commenting on the lack of interest of the UK banking sector in the future financing of British steelmaking assets. For example see http://uk.reuters.com/article/us-tata-steel-britain-banking-idUKKCN0XB2CM which comments that “Britain's biggest steel business is such an unattractive prize that most major investment banks are not even angling for the opportunity to advise potential buyers on one of the year's highest profile deals”.

In my own experience, if the investment decision is attractive, the financing decision usually follows. The reluctance of the UK banking sector to get involved with financing any restructuring of British steelmaking assets is therefore telling me that more work needs to be done on the investment decision itself – i.e. on developing an attractive vision of future UK steelmaking – a vision which is cost-competitive and which will prove viable over the longer term.

I will in the coming days be posting some further thoughts on how this might be achieved at sites such as Port Talbot in South Wales.

Andrzej M Kotas, MBA

Managing Director

Metals Consulting International Limited

Website: www.steelonthenet.com

British steel - cost of tidal power

Some press reports are suggesting that Liberty Commodities’ plan for Port Talbot is to use electric arc furnaces (rather than blast furnace steelmaking), with the electric power coming from the Swansea Bay tidal lagoon.

Is this credible?

The UK’s cost of power at ~9p per kWh is already almost double that of continental Europe, where is it ~5p per kWh. Yet the cost of power from the Swansea tidal scheme is said to be several times above the normal wholesale price electricity. See https://www.theengineer.co.uk/your-questions-answered-tidal-lagoons/

If this is so, investment in electric arc furnaces at Port Talbot with use of tidal power cannot lead to a viable long-term solution for steel production in south Wales.

For further reports on the future of steelmaking in the UK, visit http://www.steelonthenet.com/feeds/uk.php

Andrzej M Kotas