INDUSTRY UPDATES on 10.09.2012


INDUSTRY UPDATES
on 10 September, 2012
STEEL, METALS AND MINING
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COAL
IST Steel & power says it is on track to start coal production
IST Steel & Power, in which former Corporate Affairs Minister Prem Chand Gupta's son Gaurav Gupta is a Director, today said it fails to understand why a show- cause notice has been issued to it for delay in developing the Chhattisgarh coal block that is progressing on schedule. "We don't know why a show-cause notice was given to us when the block is ready to start production from August, 2014. Our end-use plant (sponge iron) has also started production," IST Steel & Power's Director S C Jain told reporters after making a presentation before the Inter-Ministerial Group(IMG).

The IMG, headed by Zohra Chatterji, Additional Secretary, Coal, is reviewing the progress in 27 coal blocks which were allocated to private companies between 2005 and 2009. It may recommend de-allocation of these blocks which have not made satisfactory progress. Dahegaon-Makardhokra IV block was given to IST Steel and Power, along with cement firms Gujarat Ambuja and Lafarge India, in June 2009. The block has a total of 48.84 million tonnes of extractable reserves. IST Steel and Power owns the majority 53 per cent stake in the block.

When asked whether the company was given a favour in the block allocation, Jain said, "If somebody's father is a Minister, it is not his fault."  Jain said the mining plan for the block has also been approved and it is likely to get the forest clearance soon. Stating that the block would start production "in time", he said the company hopes the IMG would not recommend de-allocation of the block.

SKS Ispat and Power, in which Tourism Minister Subodh Kant Sahai's brother held the position of "honorary director", also presented its case before the IMG. The company officials did not talk to the media. Seven other coal block allottees, including Tata Iron and Steel Company, JSW, Grasim Industries, Kesoram Industries and Bihar Sponge Iron, appeared before the panel.
(Economic Times)
IRON ORE
Indian iron ore exports in April to June dips y 40pct YoY

Departmental investigation has held 1989-batch IAS officer Mr Kripa Shankar Saroj and 1993 batch Punjab civil service officer Mr Amarpal Singh guilty in 2004 iron and ore scam of INR 17 crore.

Punjab’s Chief Secretary Mr Rakesh Singh has recommended strict action against the two officers for their involvement in the iron and ore scam.

In his letter written to Punjab Chief Minister Parkash Singh Badal, the Chief Secretary has requested ‘major punishment’ to both the officers.

The two officers in their capacity as MD and AMD of Punjab Agro Food Grain Corporation and had issued orders to sell (without issuing tenders) iron ore worth INR 17 crore to Reliance Polycrete in 2004. The company had submitted fake documents in the PAFC as guarantee. Later in 2005, the company issued two cheques of INR 5 crore and INR 9 crore in favour of PAFC in 2005 which were bounced. The company defaulted payments against PAFC.
(steel guru)
CEMENT
AGRICULTURE
Import of pulses, edible oil may rise this year: Thomas 
WITH the strong possibility of lower kharif acreage due to the deficient monsoon, the government is likely to go in for higher imports of pulses and edible oil this year, it is reported. 
Disclosing this in the Rajya Sabha, the Minister of State for Agriculture, Consumer Affairs, Food and Public Distribution, Prof. K.V. Thomas, expressed the likelihood of lower acreage hampering production of pulses and oilseeds and elucidated that going in for more imports was the only way to match the supply-demand gap. He, however, added that the government had not yet made any specific estimation on import of pulses and edible oil in the current year. 
The current monsoon shortfall has reduced pulses acreage to 8.83 million hectares (mh) so far in the kharif season, compared to 9.97 mh in the same period of last year. Besides, the oilseeds sowing area shrunk to 16.42 mh (16.99 mh). 
The Minister also brought to light that the country had on an average imported about 2.5-3.5 million tonnes (mt) of pulses and 8-9 mt of edible oil in the last three years.
(Exim India)
Food ministry comes with two plans to fix retail price of sugar
At a time when the Rangarajan committee is giving final touches to its recommendations on sugar deregularisation, The Union food ministry has come up with two proposals for fixing new retail price of sugar sold in ration shops (levy sugar) to reduce the food subsidy bill.

According to the first proposal, the food ministry has recommended to free up the prices of levy sugar and allow state governments to fix it as per their financial resources. This would result in different levy sugar prices in different states and Union territories.

The second proposal says that the food ministry may fix a uniform price for the levy sugar across the country in the price band of existing Rs 13.5 per kg to Rs 25.37 per kg - the price at which the subsidy on levy sugar is nil. "With the deduction of every rupee from Rs 25.37 a kg, government will have to shell out a subsidy of Rs 270 crore. Now the government has to decided how much subsidy it want to pay for sugar distributed to the poor families," said a food ministry official.

The food ministry has circulated both these proposals to various ministries including agriculture ministry, finance ministry and the Planning Commission. While the plan panel is in favour of allowing state governments to decide their levy prices, agriculture and finance ministries back uniform fixation of sugar prices by the Centre.

The Commission for Agriculture Costs and Prices (CACP), which advises the government on price policy of major agricultural commodities, has also recommended the government to do away with its levy sugar obligation, and purchase the commodity for PDS operations directly from mills.

Under the levy obligation, the government supplies around 2.7 million tonne sugar to poor families and to defence forces at rates much below the market price. For this, sugar mills are required to sell 10% of their output to the government at cheaper rates.  "This amounts to a subsidy of about Rs 7,000 per tonne, and about Rs 1,900 crore for distribution of 27 lakh tonne in PDS (excluding supply to Army Purchase Organisation).

This is primarily being borne by the sugar industry, but consequently is borne by farmers, as the industry cannot pay them higher price partly due to the levy obligation," the report said. The food ministry, earlier this year, had proposed a 30% hike in levy sugar prices from Rs 13.5 a kg to Rs 17.5. However, the proposal could not get through.

The levy price has been kept unchanged at Rs 13.5 per kg since 2002. This is despite the steady increase in ex-factory price - the rate at which the government buys sugar from mills. The ex-factory price of levy sugar has been raised from Rs 17.61 per kg to around Rs 19.04 between 2009-10 and 2011-2012 - which is still much lower than the actual cost of production a factory incurs at Rs 28-30 per kg.

The government bears the cost difference between the levy sugar price and the ex-factory price while the mills have to suffer losses, resulting from the difference between the cost of production and ex-factory price, which amounts to Rs 2,500-3,000 crore a year. The ex-factory price is calculated on the basis of fair and remunerative price (FRP), which stands at Rs 145 per quintal for the current season
(Economic Times)
FERTILISERS
ENERGY 
SHIPPING, TRADE AND TRANSPORT
KPT wins Major Port of the Year award at MALA 2012 
Kandla Port Trust (KPT) won recognition as the Major Port of the Year for 2011-12 at the third All-India Maritime And Logistics Awards 2012 (MALA 2012) held on Friday, September 7 at the Vivanta by Taj President here. 
In a hall that was bursting at the seams with the crème de la crème of the industry, Dr P. D. Vaghela, Chairman of KPT, accepted the award trophy and certificate from Capt. P.V.K. Mohan, Chairman of National Shipping Board, and Capt. Anil Singh, Senior V-P and MD of DP World Indian Subcontinent. 
The other nominees in this category were Jawaharlal Nehru Port Trust and Visakhapatnam Port Trust. 
KPT registered a throughput of 82.5 million tonnes in 2011-12, the highest in the country.
(Exim India)
Amsterdam bridge  3- A burning bridge at Jnpt
On 09th September afternoon container vessel Amsterdam Bridge caught fire at Mumbai Harbour. Around 1700 hours with fire on board and thick smoke billowing out she moved out to anchorage most likely Master and officers doing a blind navigation.
It was so fortunate in this type of dangerous situation with much smoke making visibility of her navigators to near zero she didn’t cause collision with another vessel(s). At this time wind was SSW 16 Kts. Other vessels in the vicinity could hear Amsterdam Bridge’s Master desperately trying to get assistance from Mumbai VTS and JNPT ( Jawahar Lal Nehru Port Trust).
After almost 0ne and a half hour a Coast guard vessel arrived on scene followed by SCI Pawan a fire fighting tug.  Even at mid night the fire was raging and fire fighting vessels in action doing FF and boundary cooling. Seat of fire is believed to be in one of the cargo holds.
It would have been a good practice if VTS is keeping a track of all fire fighting tugs in and near harbour to call them without any delay when there is a need.
From the VHF distress traffic one could make out shore side was not having any information of what dangerous goods are there on Amsterdam Bridge or the stowage locations.
News prints state Coast Guard vessels Subhadra Kumari Chouhan and Samudra Prahari is engaged in fire fighting and pollution control.
Watch video of Amsterdam Bridge steam out with thick smoke
Following out she moved out to anchorage most likely Master and officers doing a blind navigation.
( Hindu Business)
Industry hails Cabotage exemption to Vallarpadam terminal



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