Productive Industry Requires University AssistanceIsfahan University of TechnologyResearch Chief

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NEWSLETTERSTEEL

Given the Iranian government’s detailed planning and determination, rich mining reserves, creative human resources and an uptick in domestic

and foreign investment, Iran can be among the world’s top ten major steel producers, Dr. Bahram

Sobhani, the managing director of Mobarakeh Steel Company (MSC), told the opening ceremony of the first international Iron and Steel Conference in Iran sponsored by Metal Bulletin.The conference which brought together over 30 companies active in the steel industry opened on September 15 at

an international conference center on Kish Island.Economy Minister Ali Tayyebnia, Karbasian, the deputy industries, mines and trade minister, and MSC Managing Director Bahram Sobhani, who also serves as the head of Iran's Steel Producers Association, made speeches at the gathering.

Sobhani recalled the emphasis that the deputy minister put on the government’s strategy and determination to raise the country’s steel production and elaborated on present conditions of Iran’s steel industry and its future, the growing trend of steel production over ...

ABAN 1394 www.msc.irNOV 2015 No. 08

Mobarakeh

The Trade Fair of Iran and Armenia Expo

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Iran Can Be Among World TopTen Major Steel Producers

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Local Firms Take Care of 80 Percent of MSC Projects

PR Managers of the Ministry of Industry, Mine and Trade’s Nationwide Summit inMobarakeh Steel Company

Mobarake Steel Companythe National Outstanding Exporter in 2015 P.4

Iran’s Steel Ranking in World Climbs to 13th

The extraordinary general Assembly of Mobarakeh Steel Co was held in Negin-e Naqsh-e Jahan Hall on Monday, October 12, 2015, with the attendance of 80 percent

of the stockholders, during the course of which Capital increase IRR 50000 Billion to IRR 75000 Billion was approved with an overwhelming majority of the votes in favor.According to the MSC reporter , Sobhani, Chairman of the Assembly responded to the shareholders’ questions regarding the capital raise and further added that, “due to the construction of steel mills by mining companies, the main challenge steelmakers will soon be facing would be shortage of iron ore and pellets. Mobarakeh Steel factory plans to overcome the mentioned challenges through investment in iron ore and pelletizing plants.”In response to a question regarding the provision of water and electricity for the project he responded, “Given the fact that a number of different investors have participated in Sangan, including South Kaveh, Parsian, and Khorasan Steel Companies, a company will be established to deal with issues of providing the necessary infrastructure.”According to the reporter at the Steel Mill, in the Assembly, Amir Hossein Naderi, Deputy for financial and economic affairs, went over this Year’s feasibility report for the capital increase, and provided a review of previous years’ raises in capital. “The increase in capital has been a sum of 2500 billion Rials, 2000 of which has been provided for through collecting the receivables, and 500 billion from surplus, adding up to half the amount of current overall capital of the company, the approval of which will turn Mobarakeh Steel into the largest corporation in terms of working capital in Iran stock market.” He announced.Mobarakeh Deputy for Financial and Economic Affairs stated that, “the main purpose of the capital increase is [providing funds for the] completion of Sangan developmental project, which comprises the iron concentrate developmental plan to produce 5 million tons of iron ore pellets; increased funding for Gol Gohar, as well as [the implementation of] reforms to

the company’s financial structure.In regard to where the financing for the capital increase comes from he explained, “The capital increase comes from retained earnings, cash

earnings, and receivables, with the capital increase amounting to 25,000 billion Rials, 5000 billion Rials of bonus shares and retained earnings, and the rest of 20000 billion Rials is from cash earnings and receivables. Thus, with the plan’s approval, the company’s assets will raise from 50,000 billion Rials to 75,000 billion, making it up to be a 50 percent increase, 10 percent accumulated cash and 40 percent of the rest from receivables and cash earnings.”Regarding the scope of developmental projects in Sangan he said, “The project comprises construction of two units for the production

of iron ore concentrate and iron pellets, each with a capacity of 5 million tons. So far, the progress on the pelletizing unit has been 70%, and the concentrate unit has had 15% physical progress; and is expected to be operational halfway through the year 95 (Iranian calendar year), and the pelletizing mill will be ready at the beginning of the year 96 (Iranian calendar year).Naderi called the outcome of the financial analysis feasible and further clarified, “considering the free cash flow and assuming that there will be a 25% discount rate, net present value at 4610 billion Rials, an 87.31 percent internal rate of return, and the payback period of 4 years and three months, the proposed plan is considered acceptable.”The company’s Deputy for Economic and Financial affairs described the process through which the raise in capital is to take place, and further called the process time-consuming and complicated. Considering the legal requirements relating to the company’s capital increase cited in articles 157 to 198 of the commercial code, as well as the prerequisites of the Exchange Organization and the company’s Inspector General, we need a permit for all the stage of the [process of] capital increase which leads to the natural process of capital raise taking about 7 to 8 months.

Major Capital Boost Turns Mobarakeh Steel into Largest Company in IranStock Market

Economy Minister:Iran BestCountryin MENA for Investment

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STEEL NEWSLETTERwww.msc.ir NOV 2015 No. 08NOV 2015 No. 08

03National National

At a gathering on September 28 attended by the management and staff members of Mobarakeh Steel Company

(MSC), Dr. Bahram Sobhani, the managing director, presented a complete report on steel production and sales figures in the world and on the company’s performance between March 21 and September 22, 2015.He said, “Although the steel industry

in the world is currently facing problems and the crisis seems to be on track to continue well into next year [September 2016], fortunately MSC has been able to maintain its position in the competitive marketplace thanks to the efforts of its staff, production of quality products and exports to global markets.”Workplace safety comes firstDr. Sobhani recalled Safety and

Firefighting Day observed on September 29 and said, “In recent years, [workplace] safety at MSC has improved – in terms of the number of repeated accidents and their severity – but more has to be done, thus appropriate measures need to be taken to minimize the number of repeated accidents and reduce their severity; obviously total elimination of minor and major accidents would be the ideal condition.”Product quality index in a six-month

period On product quality index between

March 21 and September 22, he said, “In Steelmaking and Continuous Casting units, according to plan, our index for production of faultless slab was 89 percent, while in practice we secured 90.8 percent. As for cold rolling and production of coated products, the index was 91.3 percent, but in practice, the unit performed better and gained the quality index of 92.3 percent.Production performance in a six-

month period On production statistics, the MSC

managing director said, “With the production of 3.957 million tons in six months, the Pelletizing Unit at MSC was three percent ahead of schedule and showed a two percent growth over the corresponding period last year.“As for sponge iron, the combined

production at direct reduction units of MSC and Saba Steel Company (SSC) has reached 3.788 million tons which shows a three percent increase over similar period last year.”He put the volume of combined slab

production at MSC and SSC at 3.106 million tons and said, “In the six-

month period, we were one percent ahead of schedule.The production of hot [rolled]

products by the two companies reached 2.919 million tons, while the production of cold [rolled] products and coated products hit 689,000 and 178,000 tons respectively.”Dr. Sobhani said that MSC has

produced 844 thousand tons of quality products in the said period adding, “Those production figures have put us 22 percent ahead of schedule; we have also secured a five percent growth over the corresponding period last year. As much as 2.729 million tons has been transferred by the product shipment unit.”He said that Hormozgan Steel

Company has produced 625,000 tons of sponge iron in the six-month period. “According to plan, our domestic sales were expected to reach 2.165 million tons in the six months to September 21, thanks to the market conditions, only 85 percent of that objective has been

met.” MSC exports to target marketsOn exports, the MSC managing

director said, “We set an ambitious objective of 1.5 million tons of exports last year [ended on March 20] and we pursue the same objective this year. We have exported about 747,000 tons by September 22; that means almost 50 percent of our objectives have been met. In fact, given the present conditions and problems facing domestic and export markets, our performance as far as exports are concerned have been good.”He went on to say, “Europe has

imported 63 percent of the products, the Middle East and Far East have had a 29 and 8 percent share of the company’s exports. According to figures, MSC exports to Europe have risen by 10 percent.”He credited the high quality of MSC’s

products for an increase in exports to Europe and said, “In the European Union we enjoy a good position

because of the good quality of our products.” Iran’s steel productionAs for crude steel production,

he said, “Because of the present conditions, production at a majority of domestic producers has declined over last year. However, MSC production has been one percent ahead of schedule and its six-monthly output has stayed [quite] the same over 2014. That is a praiseworthy achievement.”Difficult years for world steel

producersSobhani pointed to a report by the

World Steel Association and said, “The association has likened this year to a death whirlpool for steel producers and said that if steelmakers manage to strike a balance between costs and [the final] price, they can ride out the storm.”What should be done?He said, “Given a rise in the prices of

energy forms in Iran, the companies which fail to manage costs and the

amount of their production will definitely face a lot of problems. We need to be realistic; revenues have declined while costs are on the rise. If costs are not controlled, it is inevitable for organizations to run into trouble.”As for solutions to stay in the

production cycle and survive the cutthroat competition, he said, “Through quality production with a higher value-added tax (VAT), reduction of the volume of scraps, management and prioritization of costs, sales of scraps and surplus materials, management and prioritization of projects and swifter completion and exploitation of projects, we should join hands to keep MSC a profitable economic institution in competition with foreign rivals.We need to bear in mind that every single staff member is responsible and we are all passengers on board a large ship called Mobarakeh Steel Company. We should not allow this huge vessel to run into trouble.”

Reza Esmaeilpour, Head of the Pelletizing Unit of Mobarakeh Steel said that, “We have hit a new record in production of iron oxide pellets with a 3 million and 957 thousand and 52 tons of pellets output, halfway through the year 94 (Iranian Calendar Year).” “The figures suggest a 1.76 growth in

production, compared to the same period last year, which saw a record of 3 million 888 thousand and 381 tons of iron pellets being put out to market.” He underscored. “This accomplishment has been made

possible through tireless efforts of all the personnel and staff members at the technical office of production and maintenance, Pellet Storage and Reclaim Unit, Laboratory and quality management, and the support of the iron production unit, and putting equipment into service for pellet production effectively in the pelletizing unit of the factory. “Manager of the pelletizing plant stated.

Benteler Steel/Tube began production on 1 August at its new oil country tubular goods(OCTG) mill at Shreveport in the US state of Louisiana. The $975 million facility is stillhiring staff and remains focused on develop-ing capacity, despite market pressure fromoversupply and low oil prices. Benteler Steel/Tube, the German unit of the Austria-based Benteler Group, has four sales offices in North America and a regional headquarters

Brazil’s CSN is starting to put its asset sale plan into practice, as it aims to reduce its debt level. “We will divest non-core assets, and we have already hired banks to help us with this,” ceo Benjamin Steinbruch toldanalysts on August 13. The company plans to sell part of its shares in local logistics com-pany MRS, its 17.42% stake in Brazil’s flat steel producer Usiminas, plus some energy projects and the Tecon private port in Rio de Janeiro. CSN has already heard inter-est from potential buyers, and some divest-ments could be closed by the end of 2015. The steelmaker is also negotiating an exten-sion to its debt maturity and enacting cost-reduction measures.

Pellets by year-end US miner Cliffs NaturalResources will begin shipping direct-reduced (DR)-grade iron ore pellets later this year, according to the company’s top executive, Lourenco Goncalves. This diversification, from its Northshore Mining operations in Min-nesota, USA, represents a strategic step for the company, which has traditionally made standard and fluxed pellets for blast furnac-es. Northshore Mining will also continue to produce standard pellets for blast furnaces, as Cliffs aims to satisfy the raw materialsrequirements of both blast furnace and EAF steelmakers. Cliffs is also developing a newfluxed iron ore pellet, called Mustang, at its United Taconite (UTAC) operations in Minne-sota. Mustang will supply ArcelorMittal USA’s Indiana Harbor No. 7 blast furnace.

Kazakhstan has extended its ban on ferrous scrap exports until March 2016, according to the country’s Association of Mining & Metal-lurgical Enterprises (AMME). The embargo was first imposed in December 2013 to ‘pre-vent critical shortages’ in the domestic mar-ket, and has been prolonged several times.Kazakhstan exported 691,628 tonnes of scrap in 2013, with Ukraine being a key destina-tion, according to Metal Bulletin Research.

The Saba direct reduction unit sets new monthly record with production of 99 thousand and 535 tons of sponge iron in September, 2015.Ahmad Ahmadian, the manager of Saba Steel Production and Continuous Casting, confirmed the news and said, “The previous record of monthly production at SABA direct reduction unit was 92 thousand and 535 tons of sponge iron.

Morteza Akbari, a Specialist in electrolytic clean-ing line in Mobarakeh Steel Plant, announcing the news and stated that, “the hard-working crew at the electrolyte cleaning unit set a new record with production of 16 thousand and 727 tons of sheets.He declared that the figures show an 8 percent in-crease compared to the last record set in August, this year.

Cost Control, Quality Production Only Way to Compete on Global Markets

New Record Reached for the Pellet Production Plant Halfway Through 94 (Iranian Calendar Year)

Saba Steel Plant Direct Reduction Unit Sets New Monthly Record

Achieving New Monthly Record of Production for the Electrolytic Cleaning Line of the Cold Rolling Mill

Benteler Starts OCTG Mill

CSN Divests Non-Core Assets

Cliffs to Ship DR-Grade

Kazakhstan Extends Scrap Ban to 2016

The head of the Research Center of Isfahan Uni-versity of Technology has said that studies into modern steelmaking technologies, which are the building blocks of development projects at Mobarakeh Steel Company, are among the most important projects the research facility has con-ducted. For an industry to be productive, coopera-tion with universities is vital, Mohammad Reza Foruzan was quoted as saying by the Iranian Students’ News Agency. “But, a non-productive industry eyes imports of products and technolo-gies. In the absence of productive industries, universities have a duty to create such indus-tries.”He further said the research facility was es-tablished in 2007 to promote demand-driven research activities in the steel industry. “This research center was set up to play a role in the

macro policies of the country in the steel indus-try and to help determine technological, mana-gerial and economic best practices in steelmak-ing.” Among other things, the research facility seeks to develop excellent capability to analyze, de-sign, optimize and renovate processes, promote productivity and develop local mechanisms in steelmaking processes, systems and equipment and establish the ability to tap into university research to meet the technological needs of the steel industry and draw up national steel stan-dards, he said.In addition to industrial demand-driven proj-ects, the research center is working on projects to develop steel design technology and equip-ment. “Completion of these projects will elimi-nate the need for purchases of technical know-how.”

Foruzan said the facility also seeks to become “the largest research center capable of devel-oping cutting-edge science and technology in all steel-related areas in the Middle East.” He further said the dissertations of some gradu-ate students are chosen with an eye to the goals and plans of the steel research center. “Stu-dents and graduates are the biggest contribu-tors to the research projects.” Isfahan accounts for 70 percent of all steel pro-duced in the country, he said, adding, that is why the center has been set up in the central province to have continuous, dynamic relations with the industry. He said structured research helps settle the problems of the steel industry. “How effective these studies can be depends on the attitude of managers and decision makers of the industry and their contribution to research.”

The top researcher went on to say that without putting in sufficient time and energy, no proj-ect produces the intended results, “Naturally the more support the research gets, the better results it produces. In light of the fact that the steelmaking is a big industry, maybe the second biggest in the country after oil, research in this area requires the all-out material and moral support of the industry as well as major insti-tutions such as the Ministry of Industries, Mines and Trade. In conclusion, he said the steel industry is di-rectly linked to other industries such as mining, energy, transportation, construction, car-mak-ing and all other industries which play a role in production of raw materials and consumption of products. In other words, any progress on this front will have a direct positive impact on other industries.

Productive Industry Requires University AssistanceIsfahan University of Technology Research Chief

in Brief

STEEL NEWSLETTER

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www.msc.ir NOV 2015 No. 08

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Given the Iranian government’s detailed planning and determination, rich mining reserves, creative human

resources and an uptick in domestic and foreign investment, Iran can be among the world’s top ten major steel producers, Dr. Bahram Sobhani, the managing director of Mobarakeh Steel Company (MSC), told the opening ceremony of the first international Iron and Steel Conference in Iran sponsored by Metal Bulletin.The conference which brought

together over 30 companies active in the steel industry opened on September 15 at an international conference center on Kish Island.Economy Minister Ali Tayyebnia,

Karbasian, the deputy industries, mines and trade minister, and MSC Managing Director Bahram Sobhani, who also serves as the head of Iran's Steel Producers Association, made speeches at the gathering.Sobhani recalled the emphasis

that the deputy minister put on the government’s strategy and determination to raise the country’s steel production and elaborated on present conditions of Iran’s steel industry and its future, the growing trend of steel production over the last decade, the industry's untapped potential for investment, and a rise in steel production in Iran.Sobhani said, “There are 16 iron ore

mines with a capacity of 4.5 billion tons in Iran. The most important of these mines are in central Iran and are ready for extraction and exploitation.”He stressed the need for the

implementation of development projects in Iran’s steel industry and said, “Iran is a vast country 1,648,195 square km in

area; it has a population of 80 million. Twenty-seven million of them are young and educated human resources whose average age is 28. Given the country's rich mines and its creative and young human resources, production of 55 million tons of steel is expected to be within reach.”Dr. Sobhani added, “According to

world steel producers, Iran currently comes in 14th in global rankings; through the implementation of projects at hand and an increase in production from 20 million tons at present to 55 million tons, the country plans to claim the 8th place on the list in ten years.”He further said, “In the next ten

years, the [production] capacity of iron ore concentrate is expected to reach 65 million tons and the pelletizing capacity will increase from 21 to 62 million tons. The production of sponge iron is expected to reach 67 million tons, while crude steel production will increase to 50 to 55 million tons.”Sobhani put Iran’s share of crude steel

production in the Middle East and North Africa at 80 percent and said, “A majority of producers in this region produce steel sections.”Sobhani recalled the positive

performance of MSC in exports and said, “Today, quality plays a key role in exports of steel products; that’s why

many countries favor MSC’s products.” He added, “In 2007, 1.5 million tons

of steel products was exported, but last year [ended on March 20, 2015] MSC alone exported 1.5 million tons of products to the world’s competitive markets and MSC owes its success to high quality of its products.” Sobhani further said, “At present,

MSC has a 50 percent share of Iran’s steel production. To maintain its market share, the company has set a production objective of 12 million tons in its medium-term plan and a production target of 25 million tons in its long-term plan.”He further said, “Production and

consumption of Iran’s steel has seen an upward trend. However, in recent years, consumption and construction have declined because of recession. Given better investment conditions, they will definitely grow; that is well within reach.”MSC took part in the exhibition

section of the conference too. In its booth, where the managing director, his deputies and experts from different units of the company were present, Iranian and foreign guests were welcomed and the company’s recent achievements, opportunities, investment advantages in Iran’s steel industry, particularly in MSC, were discussed.The conference was designed to

introduce Iran’s potential in iron, steel and mineral industries, provide relevant information, facilitate international communications, introduce the latest achievements and modern technologies in the world, discuss the existing weaknesses and strengths as well as infrastructural topics, identify target markets and the share of the private sector in these industries, discuss macro, long-term development plans along with the technologies appropriate for these industries and point out investment advantages in Iran’s iron and steel sectors.Iranians accounted for 45 percent

of those who participated in the conference while 55 percent were foreigners: Asians (15 percent), Europeans (20 percent), Americans (5 percent) and East Asians (15 percent).Seventeen companies had booths in the expo. During the 2-day gathering, nearly 300 separate meetings were held between different individuals and companies.

Iran is the best country in the entire Middle East and North Africa as far as foreign investment is concerned, the minister of economic affairs and finance said. First Iron and Steel Conference [sponsored by] Metal Bulletin [a specialist international publisher and information provider for the global steel, non-ferrous and scrap metals markets].Ali Tayyebnia, addressing managers, experts

and investors from the world’s steel and mining companies, further said that the Iranian government is trying to make market conditions more predictable for investors, adding that government also seeks to amend the laws so that domestic and foreign investors have to cover less in costs for investing in Iran. He also said that the

Foreign Investment Protection and Promotion Act, which is Iran’s best basic law, lends all-out support to investors. The economy chief

went on to say that the countries and companies that have participated in this conference can seize the current opportunity and make the most of it. He said that foreign delegations have been taken aback by cooperation opportunities up for grabs in Iran, adding these delegations could not believe that Iran had so much to offer.Iran has a long record in strategic industries

and this is a turning point [for the country and investors] to make more profits and register economic growth. Metallurgical industries are one of the key

indicators of a country’s growth and the future of this industry is promising in Iran, he said, adding that a boom in the housing sector will push up demand for metallurgical products. The minister said that the country needs to give

still more attention to quality, modern sciences

and enhanced productivity if the steel industry seeks to become more competitive. Tayyebnia recalled nuclear talks between Iran

and P5+1 and said that Iran used a diplomatic tool to prove the peaceful nature of its nuclear activities, prompted the United Nations to release a resolution in support of its nuclear plan, and thus set the stage for economic growth. The finance minister said that Iran’s economic conditions are becoming normal, adding that sanctions – which inflicted huge costs on Iran – came with some benefits for the country: they

helped Iran’s economy become less dependent on oil revenues. This trend continued and Iran saw its trade balance land in positive territory in the first five months of this year [March 21- August 22]. Termination of sanctions

will raise oil sales and revenues and will help the country tap into foreign financial resources, he said, stressing the new situation should not cause the repeat of the past mistakes. We need to develop the private sector so that the stage can

be set for sustainable growth [in the country]. Tayyebnia then blamed the domination of a state-run financial system in iron ore companies for the absence of private presence in this sector. The economy minister touched upon the

government’s economic achievements and said that over the past two years inflation has dropped to below 14 percent from a previous 45 percent, adding this trend is bound to continue by yearend. He added that the government aims to push inflation into single-digits. The economy chief concluded that Iran registered negative economic growth for two consecutive years before the [rise to power of the] eleventh government, but in 2014 it managed to post positive growth four quarters in a row.

Americano Nickel Ltd (ANL),the new owner of the Fal-condo ferro-nickel project in the Dominican Republic, said on August 18 that it aims to restart the plant ‘within months’. The mine’s opera-tions have been suspended for maintenance since October 2013, a decision motivated by high production costs and low nickel prices. Located 80 km north of the country’s capital, Santo Domingo, Falcondo pro-duced a total of 15,186 tonnes of nickel in ferro-nickel in 2012. ANL, a subsidiary of the international investment fundGlobal Special Opportunities Ltd (GSOL), acquired all of Glencore Canada’s shares

China’s Shougang Jingtang Iron & Steel (Jingtang), a subsidiary of the Shougang Group, is pushing ahead with its 43.5 billion yuan ($7 bil-lion) expansion plan despite a weak steel market. It has started construction on a second phase, which will raise its existing crude steel capacity of 9.7 million tpy to more than 19 million tpy. The expansion, which is expect-ed to be completed by the end of 2018, will allow the mill to produce 18.1 million tpy of high-quality flat prod-ucts, particularly auto sheet, Jingtang said.

Tata Steel has decided to stop operations at its UK hot strip mill at Llanwern in South Wales, the company said on August 26. Produc-tion at the cold rolling mill and one of the two pickling lines at the site, near New-port, will also be halted. However, the second pick-ling line and the Zodiac gal-vanizing line will remain in operation. The move is in-tended to reduce costs and allow a focus on higher-val-ue products. The company will retain the facilities so that they can be restarted when market conditions become more favourable, it said.

Most Chinese steel mills expe-rienced falls in profits orplunged into losses in the first half of 2015. AlthoughShandong Iron & Steel re-versed a $125 million loss the previous year to make a net profit of $1 million, the coun-try’s biggest mill, Hebei Iron & Steel, was the only producer to report even a moderate year-on-year rise in profits. Chongqing Iron & Steel record-ed the biggest fall, more than doubling a loss of $148 million in the first half of 2014 to a $347 million loss in 2015.

Belarus will enter the mar-kets for tinplate and cold rolled coil with the output from a new mill planned for commissioning by 2018. Construction of the €200 million ($225 million) Miory metal rolling mill (MMPZ) is scheduled for completion in 2016, Belarus information service Belta reported in late August, while commissioning will take another two years. MMPZ has an initial planned capacity for 150,000 tpy of tinplate, to be extended to 240,000 tpy within a year of its commissioning.

Brazilian steelmaker CSN will invest 800 million Reais ($255 million) to build a shipping terminal at the Pecém port complex in the country’s north-eastern Ceará state. The terminal will be complete by 2018. It will be used to transfer products transported on the 1,728 km-long Transnordestina railway. The steelmaker owns 62.64% of the Transnordestina Logística rail project, which will connect Pecém with the port of Suape, in Pernambuco state.

Processor Yildiz Entegre has announced plans to build a $154 million coated coil plant at Kocaeli, near Istanbul. The company will buy coil from Turkish producers Erdemir and Hagas, which it will then roll to 1 mm gauge or thinner, and apply a colour coating. The main target markets will be white goods. Groundbreaking will take place before the end of 2015. In a second phase, Yildiz Entegre also plans to invest about $120 million in steelmaking and flat-rolled steel, most likely in Romania or Russia.

Iran Can Be Among World TopTen Major Steel Producers

Economy Minister: Iran the Best Country in MENA for Investment

Falcondo to ResumeFerro-Nickel Production

Continues With largeExpansion

Tata Steel to Idle UK Hot strip Mill

Steelmaking Profits Plunge in China

Belarus to Enter CRC, Tinplate Market by 2018

CSN to BuildNew Port Terminal

Yildiz Entegre plans to build coated coil plant at Kocaeli

Dr. Sobhani, the CEO of Mobarakeh Steel Company, ac-companied by a number of his deputies and directors, visited the steelmaking and the continuous rolling mill of Saba Plant on October 19, 2015, and assessed the construction process progress of projects in that area.Bahman Khalili, the project manager at the steelmak-ing and continuous rolling plants of Saba announced the news and added, “During this visit, Dr. Sobhani and his entourage closely inspected Water Distribution Plant, SVC, Material Handling Unit and the loading silos, FTP Unit, Ladle Furnace and Electric Arc Furnace, thin slab casting, Hot Rolling Tunnel Kiln, and the Auxiliary Plants of Saba Developmental projects.”Regarding the same issue he added that, “after this visit, a meeting was held to address the project issues during which the progress report were submitted, problems were elucidated by the contractors and the designated authorities of each division, and finally the CEO provided the necessary guidelines for facilitating the progress of the developmental plans to all the ex-ecutive agents, demanding that they address the prob-

lems and speed up all activities until the project is fully implemented.” With respect to the sub-ceiling development initia-tive in the steelmaking and continuous rolling plants, Bahman Khalili later added, “The project at hand is to increase the production capacity of the steelmak-ing and continuous casting mills from 700 thousand tons to one million and 600 thousand tons a year. The initiative entails the installation of a 150-tonne arc fur-nace equipped with the material handling system, a ladle furnace, a thin slab casting mill with the tunnel kiln, seventh rolling stand, secondary coils, third roller grinding machine, revamping the current line in addi-tion to a full automation make-over of the mill.” “Around 25,000 tons of equipment and steel struc-ture is going to be erected in this project, of which 74% belongs to the local portion and the rest 26% is the foreign equipment. In addition, equipment in-stallation is under progress in all the development units and the relevant physical progress is 78% till date”, he continued.

In trying to ride out the steel crisis in the world, a review of cost-cutting mechanisms is necessary, The Vice President in Charge of operatian of Mobarakeh Steel Company (MSC) said as he called for efforts to cut costs, render production more economical and improve the quality of the company’s products. Speaking after a meeting on ways of overcoming the world steel crisis at the MSC offices on October 5, Mahmoud Arbabzadeh said that in light of the conditions prevailing in the world steel markets and a report that MSC managing director Dr. Bahram Sobhani presented during a meeting on the company’s six-monthly performance, the necessity to share the report more plausibly with MSC managers and the staff of different units has come to light. To that end, he went on to say, a workgroup was formed. As a first step, the chief financial officer presented

a comprehensive report on the company costs and revenues in the first six months of the year [started on March 21, 2015] in comparison with the similar period last year and its first quarter profits. Based on the conditions of the company, the threats and critical points that MSC may encounter in the future were then identified before they were reviewed at a meeting attended by more than 200 company officials, general foremen, as well as technical, production-line and service experts. He further said that cost control measures take on special importance in the Procurement and Operations Units, adding better management of purchases, [optimal] use of spare parts and repairs on the one hand and lower waste and production of high-quality special products on the other can help the company better compete against global producers.

78% Progress in the Sub-Ceiling Development Project of Saba Continuous Rolling and Steelmaking Plant

Lower Cuts, Economical Production, Ever-Improving Quality Help Overcome World Steel Crisis

International News in Brief

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Armenia high delegates visit and high interest in Mobarakeh Steel Pavilion

Seventeenth Expo of Iran’s exports trade fair, a joint commercial trade fair be-tween Iran and Armenia Expo was held in Yerevan’s, Armenia, from Thursday, October 08, to October 11, 2015, to promote the development of economic and commercial relations, marketing, exports, tourism and facilitate the de-velopment of trade between Iran and Armenia, promotion and protection of domestic products and services. According to the Steel Company’s re-porter, the exhibition was an opportuni-ty for the manufacturers and industrial-ists active in the country to present their achievements in the field of sustainable and long-term trade and exports to Ar-menia and the Commonwealth of Inde-pendent States (CIS).According to the report at the opening ceremony and during the exhibition the Armenian authorities, including Prime Minister and Minister of Industries and Mines of Armenia, Consul General and Commercial Counselor of the Iranian Embassy visited the pavilion of Mobara-keh Steel, and got familiar with the ca-pabilities and diversity of products of

Mobarakeh Steel Company’s and got informed by the experts present at the booth of the factory’s scope of produc-tion and exports.

It should be noted Hovik Abrahamian, Prime Minister of Armenia visited the pa-vilion of Mobarakeh Steel and discussed the benefits of direct investment in

Armenia, including the construction of a factory in the country, and said that, “our cooperation can act as a bridge for communication between Iran and

the countries of the region, mutual co-operation can accelerate the export of Mobarakeh Steel products facilitating the customs issues and the transport of goods at the common border,” and sug-gested the use of free trade zones for exporting the goods of Mobarakeh Steel to CIS countries.”He added that, “due to the duty-free trade laws between Armenia and Rus-sia and Georgia, Mobarakeh Steel has a great opportunity for investments and exports through the Armenian channels and the Armenian government is pre-pared to work through any challenges.”According to the report, the high level of interest by the visitors to Mobarakeh Steel Pavilion led to several subsequent meet-ings established in Yerevan to examine the customer complaints and to hear the views and demands of the clients.It is worth mentioning that the exhibi-tion was held in collaboration with the Chamber of Commerce of Iran and Ar-menia and with the attendance of active companies in the fields of industry, en-ergy, petrochemical, transportation, au-tomotive, mining, machinery, polymers, plastics, agriculture and food, medical equipment and medical information technology, and IT.

The project to set up Casting Machine 5 at Mo-barakeh Steel Company (MSC) to produce 7.2 million tons of crude steel has showed 83.36 percent progress thanks to the efforts of the MSC management and staff as well as coopera-tion of contractors, Mehrdad Abdolrahimzadeh, a project manager at MSC’s iron and steelmak-ing units, said.He added, “In line with a plan to raise the coun-try’s steel production to 55 million tons a year by 2025, as Iran’s largest steel producer, MSC has initiated an under-roof expansion project to produce 7.2 million tons of molten steel a year to maintain its 50 percent share of over-all output.“After a rise in production of sponge iron and an increase of production capacity – by two million tons of slabs – at electric arc fur-naces, MSC has put the development of Casting Machine 5 on its agenda.”The manager further said, “The machine has two production lines where slabs between 200 and 250 mm thick and 900 to 2,000 mm wide are produced.” He further said, “A contract to design and supply foreign equipment was signed in 2013. After that, contracts on projects to do construc-tion work, establish a hydro site, install and set up the equipment, and supply and install four overhead cranes was awarded to local firms.”Abdolrahimzadeh put the overall prog-ress of the project at 83 percent, and said that the progress of the foreign equipment design and supply, construction work and the metal framework of the segment workshop, the hydro site and overhead cranes stands at 97, 99, 91 and 49 percent respectively. The project manager went on to say,” Presently, the instal-lation of the metal framework of the roller ta-ble and casting platform as well as fluid (oil and water) piping is underway and [the installation] of hydraulic equipment is at the final stage.” He also said that the bottom part of casting segments, which are a sensitive part of the ma-chine, are being installed with high precision.He described the quick completion of the ma-chine as a key approach of MSC management and said, “Given the present progress, the in-stallation project is projected to complete in the second half of next year [starting on March 21, 2016] when the equipment will be tested before becoming operational.”

Iran produced 1.42 million tons of crude steel in the month of June, up by 1.5% compared with June 2014 and superseding France as the 13th largest steel producer in the World Steel Associa-tion’s crude steel production report of 65 coun-tries.Crude steel production in the first six months of 2015 stood at 8.37 million tons, which shows an increase of 4.5% over the similar period of last year when 8.01 million tons of crude steel was produced, Foolad News reported.World crude steel production in the first six months of 2015 was 813 million tons, indicating a decrease of 2% compared to the same period of 2014. The Middle East showed an increase of 2.9% whereas both North America and Commonwealth of In-dependent States reported negative growth of 6.9% in the first half of 2015. Crude steel produc-tion in Asia declined by 1.5% while it increased by 0.5% in the European Union. South American production remained the same in the first six months of 2015 compared to the same period in 2014.China’s crude steel production for June 2015 was 69 million tons, showing a 0.8% de-crease compared to June 2014. Japan produced 8.6 million tons of crude steel in June 2015, reg-istering a decrease of 6.2% compared to June 2014. India’s production was 7.4 million tons, up by 0.8% compared to June 2014. South Korea produced 5.9 million tons of crude steel, down by 3.6% compared to June 2014.In the EU, Ger-many produced 3.8 million tons of crude steel in June 2015–an increase of 5.8% compared to June 2014. Italy produced 1.9 million tons–down by -11.4% on June 2014. France’s crude steel pro-duction was 1.4 million tons, showing a decrease of 1.3% compared to June 2014. Spain produced 1.3 million tons to record a 3.3% decrease year-on-year.World Steel Association is one of the largest and most dynamic industry associations. Its members, including 170 steel producers, na-tional and regional steel industry associations and steel research institutes, represent around 85% of world steel production.

The Trade Fair of Iran andArmenia Expo

Development of Casting Machine 5 at MSC Makes 83 Percent Progress

Iran’s Steel Rankingin World Climbs to 13th

Mohammad Ali Torfeh, deputy gov-ernor of Isfahan province for devel-opment affairs, Mostafa Modabber, the managing director of the Sport Stadiums Development and Mainte-nance Company, Dr. Bahram Sobhani, the managing director of Mobarakeh Steel Company, and Mohammad Soltan Hosseini, the director general of the provincial Sports and Youth Depart-ment were all on hand for the meeting Wednesday (October 7) to review the construction progress of Naghsh-e Ja-han Stadium. After inspecting various parts of the construction project, in-cluding its gradients, the metal struc-ture of the second level, preparation of the turf and construction of the VIP grandstands, the officials attended

a session where Abbaspour, the vice president of the Sport Stadiums Devel-opment and Maintenance Company, and Alipour presented comprehensive progress reports on the project and a timeline for its completion. During the inspection tour, the deputy governor of the province said that the gover-nor’s office wants to have the project inaugurated according to schedule, and added that the project to com-plete the construction of the stadium that seats 75,000 spectators should be accelerated. Meanwhile, Mostafa Modabber, the managing director of the Sport Stadi-ums Development and Maintenance Company said the logos of Mobarakeh Steel Company Club will be used in the

construction of the stadium. He also thanked the “esteemed managing di-rector of Mobarakeh Steel Company, his excellency Dr. Zargar, the provin-cial governor, and Soltan Hosseini, the director general of the provincial Sports and Youth Department and all others” who want this stadium to be completed according to schedule. Later, the managing director of Mo-barakeh Steel Company underlined his company’s support for the project and its timely completion as he talked about cost management, optimiza-tion of operations and climatic condi-tions that require closer coordination among contractors to complete the project on time. He also said that Mobarakeh FC

should be based in this stadium and underlined optimization of equip-ment, minimized costs for hosting games and application of all stan-dards required by the Asian Football Confederation. Then, Saeedbakhsh, MSC vice-president for projects who represents the steelmaker in the sta-dium project, presented a report on the progress of the project and the financial support MSC has lent to it so far. He also called for measures to speed up the completion of the proj-ect. The stadium that seats 75,000 spectators is located to the north of Isfahan. It is the country’s second largest stadium after Tehran’s Azadi and the largest semi-covered arena in the country. The first phase of the

stadium was inaugurated in 2002. Until 2006, Sepahan FC staged its home games at this stadium which was closed in 2006 for completion of its second phase. Because of financial problems the project was shelved. In 2014, the Ministry of Sports and Youth signed a deal with Mobarakeh Steel Company as investor to complete the stadium. The project started in early 2015. Under the deal the destruc-tion of certain parts of the stadium and reconstruction of others are al-ready complete. The project got off to a slow start thanks to a shortage of metal sheets needed to build its structures and reform the roof. The contribution of MSC helped settle that problem.

Naghsh-e Jahan Stadium Construction Progress Reviewed

UK steelmaker Albion Steel intends to build a Castrip® direct casting steel plant in Sheffield, UK, to produce about 450,000 tpy of hot-dip galvanized strip. Castrip was developed jointly by Nucor, Bluescope Steel and IHI. It will be the first carbon steelmaking plant in the UK for 40 years, and will capitalise on the abundant and low-cost scrap supply in the country, the company said. The plant is estimated to cost £330 million ($512 million)with the first production by June 2018 and full capacity by late 2019.

Vale increased its iron ore output by 7.8% year-on-year in the second quarter of 2015, to 85.3 million tonnes. This is its highest ever second-quarter production, and its secondhighest quarterly output after the 85.7 million tonnes produced in July-September 2014. “Production grew in the northern, south-eastern and southern systems, mainly driven by better weatherrelated seasonality, the ramp-up of the N4WS mine [at Caraj s] and the greater capacity utilisation of Plant 2 [also at Caraj s],” Vale said. The miner has an iron ore target output of 340 million tonnes this year.

Albion Steel to Build Castrip Mill in the UK Vale Increased its Iron Ore Output by 7.8%

National National

in Brief

12th International Steel Success Strategies Conference was held in Istanbul, Turkey during 9-11 September 2015 with the presence of the largest steel makers of the world and a speech made by Dr. Bahram Sobhani, Chairman of Iran Steel Producers Society and CEO of Mobarake Steel Company (MSC). As reported by Steel correspondent in

this conference, Dr. Bahram Sobhani made a speech titled “Iran Steel Prospect”, in which he stated the Iranian steel present and future conditions, increasing steel production from 2005 to 2014 as well as the existing capacities for investment and increasing of steel production in this country. He explained the aforesaid capacities

and said: “16 iron ore exists mines with the capacity of 4.5 billion tons, the most important of which are located in the central Iran and ready for exploitation.” Insisting on the necessity to establish

development plans of Iranian steel industry, Chairman of Iran Steel Producers Society stipulated that, “Iran has a widespread geographical area of 1,684,000km2 and a population of 80 million, of which around 27 million are the young educated manpower with the average age of 28. Therefore, taking into account the availability of rich mines and creative and young manpower, it is expected

that Iran stands among the first 10 steel producers of the world.” “Global ranking for steel production indicates

that Iran is now standing on the 14th rank and it is planned to reach the 8th rank by the next ten years through finishing the under-construction projects and increasing its production from 20 to 50MT,” continued Dr. Sobhani. He added: “According to the projects under

construction, it is expected within the next 10 years that the capacity of iron ore concentration reaches to 65MT, pelletizing from 21MT to 62MT, sponge iron to 67MT, and crude steel to 50-55MT.” Chairman of Iran Steel Producers Society

addressed the existing figures and announced the Iranian share in Middle East and Northern Africa as 80% and pointed out that, “However, most of the companies in this region are producing steel sections.”Mobarake Steel Company CEO dedicated

another part of his speech to the introduction of MSC and its performance and uttered: “Isfahan Mobarake Steel Group has been consisted of Mobarake Steel Plant, Hormozgan Steel Plant, and Saba Steel Complex. At present, 50% of the total Iranian steel is produced by the same group. As such, to sustain this market share, it is planned to reach 12MT of steel production on mid-term

basis, while the long term plan is to produce 25MT.” “Steel production and consumption in Iran

from 2005 to 2014 has been increasing, but consumption and construction has been

reduced during the last few years due to the stagnations. In this respect, total share of steel sections consumption is 40% and around 60% is related to the flat products,” he pointed out.

Sobhani Speech in 12thInternational Conference on Steel Success Strategies

STEEL NEWSLETTER

NEWS

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With a 50-percent decline in the failure of backup chokes in the Hot Rolling Unit which

now means the company is complying with consumption standards, some $1 million is saved at Mobarakeh Steel Company (MSC), Mehran Shams, the manager of the Hot Rolling Unit, said.He added, “Backup chokes are

sensitive and widely-used parts in rolling units which are lubricated by oil film bearing. One of the sensitive parts of the lubricating system is Babbitt coatings which only a few companies in the world can produce.” Nasiri, an expert in production at hot-

rolling units, said, “Given the problems we have faced over the years, the number of consumed coatings has been way above the standard.In comparison with the number

used by our rivals, our consumption was many times over. The high costs of procurement and maintenance prompted the manager of the Hot Rolling Unit to order the formation of a team of experts and technicians. Over a three-month period of hard teamwork, the problems with coatings were studied and addressed. As a result, the number of faulty coatings has dropped in half. The figure is expected to slip below 30 coatings a year. That would translate into a $1 million in savings on a yearly basis.”In conclusion, he thanked the

deputy manager for operations, the production manager, the unit manager, and all staff at production, maintenance and hot-rolling units for their support which led to the big achievement.

The global recession and a significant decline in the steel sector have prompted many producers to sell way below the finished price, says man-aging director of Metals and Materials Company, Farshid Soltanzadeh.According to the industrial expert, various factors have affected the global steel de-mand, including after-effects of Greece’s financial crisis, lack of growth in the US econ-omy and serious difficulties in China’s capital market.“Investments in iron ore mines were highly profitable during the previous decade and this caused markets to be saturat-ed with iron ore. However, the global recession significantly lowered demand for these products, and consequently, prices plummeted. For in-stance, Persian Gulf’s billet prices dropped by 35% last year and reached less than $340 per tons,” Eghtesad News quoted Soltanzadeh as saying.“The domestic steel market is faring no better. Although Iran is not seriously affected by the global economy due to its limited foreign trade ties, the country’s steel-consuming industries are currently experi-encing stagnation and demand for steel is at an all-time low,” Soltanzadeh said.Advisor to first vice president, Mostafa Moazzenzadeh, also echoed the views and said the government must stop invest-ment in uneconomical steel factories with less than 20% progress.Referring to President Hassan Rouhani’s remarks during a televised interview on Tuesday about injecting $2.49 billion to quick return development projects in the coming weeks, the official said implementa-tion of these projects will in-crease demand for steel prod-ucts and stimulate the market.Moazzenzadeh noted that based on the 20-Year National Vision Plan (2005-25), steel production is expected to reach 55 million tons per year and the country does not need steel factories to realize this figure.

US Steel will permanently close several of its Fairfield, Alabama, USA, steelmaking operations by November 17. This will include the blast fur-nace, hot strip mill, pickle line, cold mill, annealing facil-ity, and the stretch and tem-per line. The company will, however, maintain the facil-ity’s slab and rounds casters, the No. 5coating line and the Double Ghot-dip galvanizing joint ven-ture in nearby Jackson, Mis-sissippi. The action will not af-fect Fairfield’s tubular opera-tions or the planned electric arc furnace construction proj-ect. “[The shutdown] is nec-essary to improve the overall efficiency and cost structure of our flat-rolled segment,” president and ceo Mario Long-hi said in a statement.

Global Coal is set to launch anonline physical trading platform on October 13 for premium hard coking coal on an fob Australia basis. The platform nwill allow partici-pants to trade both branded and unbranded products. The generic specifications for the unbranded bracket include 10%total moisture, 9.5% ash, 23%volatile matter, 0.6% sulphur,68% coke strength after reaction and a crucible swellingnumber (CSN) of 8. Global Coal is also looking to develop an index on the back of the trades, bids and offers on the platform.

The manager of the Iron Unit at Mobarakeh Steel Company (MSC) has said that in the first six months of this year [started March 21, 2015], his unit has secured a $220 million decline in costs, adding that the conditions dominating the world econ-omy and global steelmaking have prompted MSC to turn cost-cutting measures into a major approach. In a bid to cut costs, put a ceiling on inventory and turn the final products more competitive, the Iron Unit implemented

effective measures on the cost-cutting front in the 6-month period, Rahim Abdi said. He further said in light of the fact that raw materials, mostly concentrates, are the costliest items in steelmaking, his unit put a lid on consumption and opted for recycled items to cut costs. By decreasing the inventory of concentrates and increasing the output of the pelletizing unit – which in turn has resulted

in a drop in the volume of concentrates and pellets MSC pur-chases –and by using recycled materials, decreasing transport mechanisms, and sales of limestone granules, the company has decreased its costs by $220 million.In conclusion, he said continued implementation of the trend will see costs drop even further; he also appreciated the ef-forts of other units which helped his nail down this achieve-ment.

Consumption of Backup Chokes in Hot Rolling Units Down by Half

Steel Demand atAll-Time Low

US Steel to Shut Several Fairfield Operations

Global Coal launches Trading Platform

First half Sees Around $220 Million Declinein MSC Iron Unit Costs

During the Export National Day Conference with the presence of Prime Minster and Industries, Mine & Trade and Foreign Ministers in the Islamic Countries’ Summit Hall, Vice President Eshaq Jahangiri granted the letter of appreciation and statue of 2015 National Outstanding Exporter to Dr. Sobhani – ECO of Mobarake Steel Co. – and acknowledged their efforts for export improvements. As reported by the steel reporter

during the aforesaid ceremony, Dr. Sobhani spoke with the correspondents in that conference and considered this success as the result of MSC managers and workers’ collective efforts, and pointed out upon addressing the importance of non-oil exports that, “It is not possible to manage a country with the population of 75 million without production. Replying on oil-related incomes is considered to be a kind of raw-material-selling, which is the public selling of God-given natural resources.” “Mobarake Steel Company owns

a suitable market by producing 50% of the Iranian steel and exporting 1.5 million tons of steel products each year. It is almost said that we are able to export any product to any desired destination with no special problem since we have a effectively entered foreign markets and well-known traders are now working with MSC through our agencies in European countries such as Italy and Germany, ranging from East to the West. This is also true with different countries in the Middle East including Iraq,

Afghanistan etc so that Europe is considered to be the destination of more than 50% of Mobarake exported products,” he added. The CEO of Mobarake Steel Co.

pointed out the fact that steel industry is called “Mother Industry” due to its remarkable influences on the different countries’ industrial development and said, “Steel is the most important and strategic industrial product in the world such that the volume of its production and consumption indicates the countries’ improvements. The aforesaid industry plays fundamental role in national economy and welfare of the societies. Accordingly, development of steel industry is considered to be an influential factor in the development of economic, industrial, scientific, and social sectors.” Addressing the production

long term plans in MSC and the importance of production with added value, Dr. Sobhani said, “It has been planned in the Iran Prospective Document to reach 55 million tons/year of steel production by 2025. However, our present production is around 20 MTPY. Taking into account MSC role of producing 50% in Iran, our target is to reach the production of app. 20 MTPY. For this, three phases are scheduled: To increase the production capacity to around 12 million tons/year within the next two or three years; to reach the production of 16 million tons by MSC in the second phase; and to access the production of 20-22 million tons by 2025 in the third

phase. Besides, products with added value is our highest priority and we are trying to direct our products towards this goal.” He remarked the important issue

that major portion of non-oil exports from Iran is related to the steel industry after petrochemical matters and pointed out that, “… of course this has been recently done in the form of iron ore.” Chairman of Iran Steel Producers

Society stated concerning the volume of steel exports by MSC that, “Mobarake Steel Company exported around 1,018,000 tons amounting to USD 500 million in 2013, which has been reached to 1,500,000 tons amounting to USD 750 million in 2014. Despite the steel industry was in a very bad condition in 2015, we exported around 750,000 tons during the first six months.” Focusing on the role of production

in economy and the society, he

reminded that, “Production leads to occupation. In case we have no production and only distribute oil income among the people, this will definitely follow with numerous corruptions. It is impossible to govern the society without hard efforts and production activities. Likewise, oil income is not stable and we have no control over its relevant market such that we watched the oil price fell down from 110 to 40 Dollars in a period.” “We have to keep in mind that

selling of raw materials means the public selling of God-given natural resources! In case we decide to put for example iron ore on sale just at the factory gate, we will only get USD 20. On the other hand, through changing the same into steel products, not only we optimize occupation in different sectors, but also the value of that iron ore will reach USD 400. Upon selling raw materials, not only we

lose the above-mentioned added value, but also the occupation will increase for the purchasers and our natural resources will be spent for the other countries’ development. Consequently, the target company will export finished products with added value and a much higher price than the raw material to our country. This is the real story of selling raw material and it makes no difference in which industrial sector it occurs. Therefore, we have to stop selling raw materials.” Concerning the steel export

concerns and obstacles, the Chairman of Iran Steel Producers Society said, “Taking into account the export difficulties, this can be divided in two groups of hardware and software. The software group is mostly related to the rules, regulations, and the role and performance of the government, in which we have no special problems fortunately. However, there were some limitations during the earlier government and the export was stopped for some time, opened for a short time and let the firms do partial exports. In contrast, these obstacles have been removed in the present government and export is free for any kind and quantity. In other words, there is no limitation for the export now but the main issue is that as the local consumption increases, the government limits the export in order to manage the local market. It is expected to consider incentives for the reverse conditions too.” Dr. Sobhani pointed out regarding

the influence of export incentives that, “Export incentives are

useful during the time we have 15-20% inflation per year and the government policy is to stabilize the currency. In case a producer does not have 15% more income than the previous year, he will be considered to be a losing entity. As such, it is necessary to provide industrial units with incentives if the government insists on currency rate stabilization. Of course, it is necessary to remind that providing such incentives does not mean cash injection, but this can be fulfilled through different ways as like tax exemptions or bank facilities. For example, Chinese government exempts the exporters from 50% of the sea transportation costs as an export incentive.”Concerning post-sanctions

atmosphere, CEO of Moarake Steel Company said that, “I am personally optimistic towards this issue and do believe that through the existing potential, we have to think about establishing those factories and industries for whom the supply of different resources like financing was limited during the past years. Steel industry is a costly sector that cannot be established through 1-3 billion bank loans. It is necessary to invest around 10,000 billion Rials, which is impracticable through the bank loans. Even if it is possible to receive such loans, repayment of 27% bank interest is not logical. Accordingly, we have to move the projects with foreign financing and loans but we hope that suitable space is opened after removing the sanctions and foreign investors come to Iran.”

Mobarake Steel Companythe National Outstanding Exporter in 2015

Interviewed by Steel Correspondent, Mr. Mohsen Salehi Nia – Deputy of Industries Affairs at the Ministry of Industry, Mining and Trade – pointed out during his meeting with Dr. Sobani and visiting Mobarake Steel Plant that, “Besides my working mission along with our team for the purpose of investigating the conditions of Mobarake production units, we also visited Mobarake Steel Plant so as to become aware of the current issues with the largest Iranian steel producer.” “Iranian authorities have always focused on

Mobarake Steel Company (MSC) from different aspects of the steel production amount in Iran, employment, added value for the economic

cycle, and its share in national gross production. Additionally, MSC is the attention and efficacy point due to its deep influences on upstream and downstream industries,” he added. Mohsen Salehi Nia enumerated the development

of MSC activities as a necessity for Iranian steel industry and said: “Taking into account the fact that “1404 Prospect” is to reach the capacity of 55 million tons of steel production, obviously this company will be able to play an outstanding role in the production of half of the steel products in Iran and meeting the development plans and Iran’s Development Plan.”He expressed hopefully that, “Iranian steel plans

will be fulfilled as the result of efforts by MSC management and staffs, putting the development plans into operation as immediately as possible, and supports by the government and authorities. Certainly, other industries will also grow optimally together with MSC developments.” Salehi Nia addressed the production of high

quality goods and paying attention to the export markets as a necessity for Iranian industries and stated that, “Basically, export, taking a look at overseas markets, and supporting the exporters are considered to be the major approaches and plans by the government so that the government believes

the above as one of his duties at Ministry of Industry, Mining and Trade and IMIDRO.”“Obviously, it would be possible to apply

existing potentials in MSC for the activation of other industries including engineering services, transportation, sub-contracting, construction, and many other infrastructures,” continued deputy of Industries Affairs at Ministry of Industry, Mining and Trade, insisting on the valuable experiences by MSC at all aspects. At the end, he appreciated all the MSC managers

and staffs’ efforts and pointed out that, “The government will provide MSC with necessary supports in all seriousness.”

Mobarake Steel Company’s DevelopmentMakes Industries Optimally Grow

National

News in Brief

NEWS

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Any global steelmakers hoping a potential end to sanctions on Iran will fully revive what was once a multibillion

dollar import market for their product will be disappointed as Tehran is boosting local output and expects its own exports to grow.Iran’s drive to more than triple production

to 55 million tons by 2025 is not all bad news for foreign firms though, as some are looking to offer technological help developing steel mills or plants to process iron ore, according to Reuters.South Korea’s POSCO and a company owned

by Japan’s Nippon Steel & Sumitomo Metal Corp are among companies gearing up to sell steel to Iran, as international producers scour the world for new customers amid faltering demand from top buyer China.But Iranian mills have been quietly stepping

up production in the face of plunging imports since sanctions were imposed around a decade ago over Tehran’s nuclear program, with World Steel Association data showing crude steel output has already grown 60% from 2007 to 16.3 million tons in 2014.“Years ago, Iran was importing 10-12 million

tons. We will never see those figures again, I can say with certainty,” said Bahador Ahramian, a board member of the Iranian Steel Producers Association.“We already have a surplus here,” he added,

putting that at 3 to 4 million tons this year.Iran’s steel imports dropped to 4.5 million

tons last year from 12.2 million tons in 2007, when the country was the biggest overseas

buyer in the Middle East, according to the association’s data and the International Steel Statistics Bureau. The 2007 imports would be worth nearly $7 billion at current prices.Ahramian added that scrapping sanctions

would increase the country’s access to international trade finance, helping ramp up steel exports.Iran expects those exports, from companies

such as its top shipper Mobarakeh Steel Company, to double to 4 million tons in the year to next March, said Mehdi Karbasian, deputy minister for industries, mining and trade. It plans to increase that to 10 million tons by 2025.

“Very Important Market”The United Nations endorsed a deal in July to

end years of economic sanctions on Iran, but they are unlikely to be removed until next year.A major carmaker that also needs steel to

develop its vast energy sector, Iran consumed 17.3 million tons of the alloy last year–about a third of the amount used in the entire Middle East.A source familiar with POSCO’s marketing

strategy said Iran was a “very important market” for the world’s No.5 steelmaker and that it would reenter the country as soon as sanctions were lifted. POSCO sold more than 200,000 tons of steel to Iran before sanctions were imposed, the source said.Abu Bucker Husain, chief executive of Al

Ghurair Iron & Steel from the United Arab

Emirates, a maker of galvanized steel co-owned by world No. 2 steelmaker Nippon Steel & Sumitomo Metal, said the Iranian market could be significant for the company.Meanwhile, Russia’s TMK, among the world’s

top suppliers of steel pipes for the oil and gas industry, said it would resume pipe deliveries to Iran when sanctions are lifted.ArcelorMittal, the world’s biggest steelmaker,

was more sanguine on prospects for business in Iran, even though it is already selling steel to trading companies that export to the nation.However, opportunities exist beyond simply

selling steel. POSCO has said it was in contact with several Iranian firms on providing technology, while Finland’s Outotec has won a contract to supply technology for a new iron ore processing plant in Iran.

Foreign Steelmakers Eye Iranian Market

Tata Steel has announced nearly 1,200 job losses at its plants in Scunthorpe and Lanarkshire, BBC reported.Nine hundred jobs will be lost at the firm’s plant in Scunthorpe. The remaining 270 jobs will go in Scotland.They are the latest in a series of job losses across the UK steel sector, following news that adminis-trators have been appointed to parts of Caparo Industries’ steel operations.The industry blames cheap Chinese imports for a collapse in steel prices.Prime Minister David Cameron has said he will raise the issue with China’s president during his UK state visit.The jobs going at Tata Steel are in part of a division that the company failed to sell earlier this year.Buffeted by collapsing prices and the strong pound, Indian-owned Tata has decided to cut back its UK operations.Tata’s steel plant in Scunthorpe, which employs 4,000 people, is one of the largest in the UK.But two mills in Lanarkshire are also affected raising concerns about the future of the industry in Scotland. Shipbuilding HistoryThe plants under threat are the Dalzell plate rolling works in Motherwell, which opened in 1872, and Clydebridge, in Cambuslang, which has been operating since 1887.[The prime minister] needs to tell the Chinese premier what action he’s going to take to stop Chinese steel damaging the future of a vital foundation industry in the UK Roy Rickhuss, General secretary of CommunityThe plants became two of the giants of Scottish industry, with Clydebridge providing steel plates which were formed into many of the most famous ships built on the River Clyde.The industry was at the heart of many Lanarkshire communities and Motherwell Foot-ball Club still use the nickname “the Steelmen” in tribute to the workers who supported them.

The secretary of Iran’s Steel Producers Associa-tions has called for increasing cooperation with Germany, especially in alloy steel production, Eghtesad News reported. Recalling the success-ful cooperation between Mobarakeh Steel Com-pany and German steel equipment maker SMS Siemag, Khalifeh Soltan said: “German steel-makers have proved to be reliable industrial partners for Iran. However, lack of finance is a key production issue in Iran and German compa-nies should be encouraged to invest and produce in Iran.” He also noted that quality steel alloy production should be the focus of joint coopera-tion with Germany as Iran is already able to pro-duce the steel required in construction. Iran’s rich reserves of energy and iron ore make it an attractive investment destination for European steelmakers. Therefore, making investment and bringing modern machinery and equipment into the projects should be the main condition for co-operation with Germany, he added. Last week, a 60-member German delegation headed by the country’s Vice Chancellor and Minister of Econo-my and Energy Sigmar Gabriel arrived in Tehran for a three-day visit at the invitation of Oil Min-ister Bijan Namdar Zanganeh. Representatives from major German companies, including large steelmakers Mannesmanne and Krupp, accom-panied the delegation.

More than 1.432 million tons of steel billet were produced in the third month of the current Ira-nian year (May 22-June 21), indicating a 1.6% growth over the similar period of the previous year.Billet production in the first quarter of the cur-rent Iranian year (March 21-June 21) stood at 4.317 million tons, up by 24,128 tons compared with the similar period of the previous year, Foolad News reported.Mobarakeh Steel Com-pany with 1.539 million tons of production, Khuzestan Steel Company with 878,724 tons, Zob Ahan Isfahan with 614,948 tons, Hormoz-gan Steel Company with 258,710 tons, Khorasan Steel Company with 171,562 tons, Iran Alloy Steel Company with 73,479 tons and Iran Nation-al Steel Industrial Group with 42,311 tons were major producers of steel billet during the year’s first quarter.Also, 4.086 million tons of various steel products, including I-beams, reinforcing bars, pipes, sheets and plates, were produced during the period.

Tata Steel Announces Job Cuts in UK

Steel ExportsAlloy Steel:

Economy Business And Markets

Steel Cooperation With Germany

Steel Billet Production Up

Chinese steel mills reduced output more sharply over the summer, in delayed reaction to a pro-nounced downturn in domestic demand, especiallyfrom construction but increasingly the general manufacturing sectors. In fact, Chinese production fell to an estimated 65.84 million tonnes of crude steel in July, according to the Na-tional Bureau of Statistics, down 4.6% year-on-year – more steeply, unusually, than the rest of the world, which fell by 3.0%. At the time of writing in mid-August, this trend was set to continue, at least temporarily, as govern-ment efforts to reduce pollu-tion for the 70th anniversary commemoration in Beijing of the end of the Second World War kicked in. Meanwhile, economic signals from China remain weak with the official manufacturing PMI falling back below 50 in July, reflecting what the specific steel PMI had been showing for months. Tighter Chinese market fundamentals even supported higher steel prices from around mid-July but few were surprised when the rally ended roughly one month later, given still-sluggish demand conditions. Although steel produc-ers are unlikely to bolster steel production signifi-cantly over the autumn, especially given the nega-tive margins among CISAand non-CISA member mills, we suspect exports will remain robust moving into the final quarter

of the year. In fact, China exported 9.73 million tonnes of steel products in July, up 21% year-on-year and close to the record high recorded in Janu-ary of 10.29 million tonnes. Anti-dumping measures are building against Chinese-origin material, but

we tend to find that the threat of duties encourages importers to book more ma-terial before any decision is made. The example of the EU’s stainless CR coil market is a case in point. Elsewhere, steelmakers arehopeful that stronger market conditions will materialise in the latter half of the year. While MBR anticipates US mills securing stronger flat-rolled margins in the short term, we suspect that higher sales prices will prove diffi-

cult to achieve if the international downturn per-sists. Fortunately for US suppliers, anti-dumping petitions are beginning to impact external trade at the same time as premiums for domesticallypro-duced steel elsewhere, notably in Europe, have ris-en over import offers, which may encourage com-petition away from the USA. European suppliers have benefited this year from less-intense import competition and a modest rise in local consumption but our pricing outlook for this region has worsened most of late as import pressures are predicted to accelerate, from countriese whose domestic de-mand has become increasingly depressed.

Ever more like the next nickelOctober 2015 | Metal Bulletin Maga-zine | 21 Ask an analyst How big and influential will copper supply cuts be? MBR has not shared the bullish view of zinc, and feels vindicated. The closure of the Century mine in Australia has been the bulls’ big fo-cus thisyear, but it has been so well flagged up for so long that the miners have already responded by investing in new capacity. It is worth noting that ILZSG data for China show a 7.6% year-on-year increase in the year to July. This is reminiscent of nickel’s failed bull story, which was also meant to be driven by a structural supply-side change that would squeeze Chinese refined supply. In nickel’s case it was the Indonesian ore export ban, but China found a workaround, knocking that bull market on its head. Zinc is heading the same way. Both markets are very steeldependent on the demand side and weak steel markets in China have damaged the demand fundamentals too. Both are also paying the price of huge previouslyunreported stockpiles of refined metal returning to the market.

Tight market justifies higher pricesWeaker-than-expected Chinese refined tin production this year has cancelled out poor global de-mand and overshadowed develop-ments in Indonesia. Chinese out-put was running about 2% lower year-on-year as of August, and news in September that China Tin has shut its Ausmelt furnace again for unexpected maintenance should prolong the contractionary trendin Chinese supply. MBR has revised down its forecast for Chinese refined tin production this year to just 169,000 tonnes, which takes our global production forecast to 359,000 tonnes, down 6.4% from 2014. At the same time we have revised down our consumption esti-mates for the year in line with a very disappointing Q3 performance in most regions. We are now fore-casting a contraction in global tin demand of 2.3% this year. Overall, this will leave the market in a defi-cit of 13,000 tonnes though – the largest since 2010. The increased tightness that we now expect in the final quarter of this year supports our $17,000/tonne price forecast for the period.

Rebounding Chinese iron ore imports and histori-cally low domestic scrap prices in mid-to-late July prompted some mills to procure larger volumes ofscrap from local suppliers, allowing Chinese scrap suppliers to push prices up by RMB180/t ($28/t) to RMB1,345/t ($210/t) in mid-August, delivered to mill (including tax). Price rises for iron ore and subsequently do-mestic Chinese scrap do not appear to fit right now with the general raw materials trend, which has been gener-ally negative. Indeed even in China, raw materials demand has continued to weaken at an increasing rate. While the demand for iron may have been particularly depressed within China – pig iron pro-duction has fallen even more rapidly than steel production through the first seven months of the year – we understand that in neighbouring countries the reverse has been true.Indeed in South Korea, where steel production has fallen proportionately more quickly than in China overall, the decline has been exclusive to mini-mills, rather than integrated producers. In fact, BOF output has continued to rise this year whileproduction at EAFs has continued to fall dramati-cally: according to local steel institute KOSA, by as much as 17.3% year-on-year. While the demand for iron and therefore iron ore has actually been ro-bust, so too has that for metallurgical coal. Import

growth in met coal supply has actually far exceed-ed the rise in underlying demand. In fact, South Korean imports of metallurgical coal surged 13.1% year-on-year to 16.4 million tonnes through the first six months of 2015. An integrated steel pro-

ducer will typically consume 600 kg ofmetallurgical coal to pro-duce one tonne of liquid steel (kg/tls). MBR estimates that South Korean mills consumed on average 628 kg/tls of metallurgical coal in the first half of 2014. More recently, however, average metallurgi-cal coal consumption rates in South Korea have jumped to 706 kg/tls in the correspond-ing period in 2015. MBR has heard anecdotal evidence that some large domestic

integrated producers have displaced some higher gradeiron ore for lower grade sinter fines, in an attempt to reduce hot metal production costs. Lower grade iron ore requires relatively larger volumes of coke for reduction. MBR understands that South Korean steel mills have continued to suffer from increased competition from Chinese rivals. Despite reducing finished steel production overall, by roughly 3%for both flat and long products, mills have struggled to reduce their comparatively high inventories and so we suspect more will have to cut crude steel pro-duction soon.

Weak Indicators and Falling Outputin China

Zinc Tin

Mixed Signalsin East Asia

Iran Alloy Steel Company, located in Yazd Province, exported more than 9,000 tons of its products worth over $4 million during the first half of the current Ira-nian year (started March 21), says the firm’s executive manager. The main ex-port destinations, according to Seyyed Ali Azarbadgan, were Germany, Spain, Italy, Portugal, Czech Republic, the Netherlands, South Korea and Afghanistan, IRNA reported. Last year, the company exported more than 17,000 tons of heat-resistant steel, surface-hardened steel, micro alloyed steel, ball bearing and stainless steel worth $12 million which, compared to the previous year, in-dicated 12% growth in terms of weight and 2% growth in terms of value

About 400,000 tons of steel were exported by Esfahan Steel Company, located in Isfahan Province, to 25 countries, including France, Turkey, India, China and Saudi Arabia, during the first half the current Iranian year (started March 21), said the director of marketing and foreign sales of the company, Behzad Karami. ESCO is Iran’s biggest producer of structural steel. The com-pany produced 2.7 million tons of crude steel last Iranian year (ended March 20), IRNA reported.

National International

International News in Brief

STEEL NEWSLETTER

NEWS

www.msc.ir NOV 2015 No. 08

06

Mobarakeh Steel Company (MSC) accounted for 51 percent of steel produced in the country in the

two years to March 2015. More than 2.5 million tons of the MSC’s output in the 24-month period was exported to global markets. The company’s production in the first seven months of 2015 posted a nine percent increase over the similar period last year. In late March 2015, the company underwent structural change and its Project and Development Division was renamed the Project Implementation Division. The renaming was designed to help boost production and secure the stated objectives of the steelmaker. Donyay-e Eghtesad daily has conducted an

interview with Ahmad Saeed-Bakhsh, vice-president for Project Implementation at Mobarakeh Steel Company.The interview covered a wide range of

issues such as the company’s structural change, studies to assess local needs to develop the company, and sanctions and their impact on the steel industry. In the interview, he expressed hope Naghsh-e Jahan Stadium plays host to a first football match by the end of the year [March 21, 2016]. Would you tell us about the activities

undertaken by the Project Implementation Division at Mobarakeh Steel Company?Up until last year Mobarakeh Steel

Company had two divisions, one focused on engineering and the other on project and development. The former was in effect a subsidiary of the latter. The Engineering Division would take care of small projects such as optimization as well as qualitative and quantitative upgrading. In early 2015, the Project and

Development Division was renamed. That led to the emergence of Project Implementation Division. The engineering section was placed under the supervision of the Technology Division. In other words, executive affairs were no longer the responsibility of the engineering section whose new mission is to develop an insight into external conditions, remain up-to-date and have an eye to the future in research, project development and tender documentation. That means the engineering unit takes

care of project development through tender documentation. When tenders are held and contractors are named, projects become the responsibility of the Project Implementation Division. It seems that the Project Implementation

Division is in charge of a wide range of activities. Would you tell us more about its subdivisions and the areas of their activities?This division manages seven projects,

namely the iron and steel units, cold and hot rolling, energy and fluids, peripheral buildings and logistics, Sangan Project, Saba Steel and Continuous Rolling, and planning and logistical management. The division is handling megaprojects such as Sangan and Saba. The parts handled by the engineering section included peripheral projects, logistics and infrastructure projects such as roads, safety, construction and the environment which were not developmental in nature. In the end, when the engineering unit refers the projects to the division, specialized sections are entrusted with following them up. How are the projects financed in the

Project Implementation Division?

When it comes to financing the MSC projects, two committees are operational. The investment committee, which is part of the engineering unit, decides in cases involving less than $1.7 million in finances. The Planning and Development Committee makes decisions in cases requiring more than $1.7 million in finances. These committees conduct expert studies and reviews, determine whether they are economically justifiable, and allocate funds for their implementation. Did these committees review the Sangan

project? No. The new approach has taken effect

since the beginning of this year. Sangan was an exception. One of the problems the steel industry is facing has to do with supply of raw materials such as pellets and iron ore which are the feedstock of the steel industry. In light of the fact that there is a shortage of local feedstock, part of the industry’s needs is met by overseas suppliers. To overcome that problem, when the former president visited Isfahan, at the request of the then managing director of Mobarakeh Steel

Company, a company in Sangan with a capacity of producing an annual 5 million tons of minerals was placed under the management of MSC to put supply of raw materials in order. On orders of the former president, MSC

was given access to part of Sangan Mine and this created an opportunity for MSC. The mine, which is located in North Khorasan Province, is already operational. Its pelletizing unit has made 70 percent progress, but the concentrate unit is only 12 percent complete. The steel industry is developing in

different areas across the country. What policy is being followed in this regard? To secure the yearly production of 55

million tons of steel in line with the provisions of the 2025 Outlook Plan, the 11th government has put development of the steel industry on its agenda. Some of these development projects are invested in by steel companies which seek to boost production. Studies suggest that building steelmaking

companies with low production capacity is not economically justifiable. Provincial steelmakers which produce between 800 and 1,000 tons each year are a perfect example for this. Financial and infrastructural woes have mired

these projects which got underway in 2007. Thus, none of them have become operational. We hope we will soon see the inauguration of Sefid Dasht Steel Company, which will be the first such unit. What criteria should be taken into

account in the development of the industry to render it successful?Before deciding to build a steel company

in an area, feasibility and infrastructure-related studies should be conducted. One important factor in building a plant is the availability of energy sources such as water, gas and electricity. Access to road and rail transport is another factor. One of the best decisions the government has taken with regard to steelmaking is that it insists on plants being built in areas near the sea. Such location makes transfer of imported raw materials and exports easy and reduces the overall costs. Where do you think the local needs for

steel should be met then? Fortunately, that issue has been taken into

account in our policy-making. For instance, the products of Mobarakeh Steel Company, Sefid Dasht and Saba are to meet the needs

of central parts of the country and the products of Hormozgan Steel Company are reserved for exports. A segment of Mobarakeh Steel Company’s products is exported too. Have the policymakers set the stage for

development of the steel industry? Today Iranian Mines and Mining Industries

Development and Renovation Organization (IMIDRO) plays an important role in the mining sector and in steelmaking plants. In this industry, technical and economic issues and balanced development in line with market fluctuations are vital. Factory input and output should be taken into account and in the absence of advance planning no steel development program should be permitted. For instance, before building a direct

reduction unit, the supply of pellets should be taken into consideration. Or when a plant is built to produce coated sheets, who provides the sheets should be considered. Fortunately, over the past two years, IMIDRO has brought the mining and steel industries under control. Does it mean that MSC will serve as

the brains of the steel sector, and other complexes such as Hormozgan will grow qualitatively and quantitatively? As the managing director has underlined,

MSC, which is in the lead in the steel industry, should opt for modern technologies and special alloys with higher added value and avoid selling raw materials. MSC has put these goals on its agenda and is trying to move toward producing special types of steel with higher added value to be later used in shipbuilding and automotive industries as well as oil and gas pipelines. We have now begun to take measures to that end. Do steel projects such as Sangan Steel

Complex and Sefid Dasht Steel Complex belong to Mobarakeh Steel Company or MSC is a just a shareholder? Sangan and Hormozgan steel complexes

belong to Mobarakeh Steel Company, and MSC holds a 65 percent stake in Sefid Dasht Steel Complex. The remaining 35 percent is owned by IMIDRO. Iran was hit by sanctions over the years,

how did these sanctions affect the country’s steel industry? Unfortunately, sanctions created

restrictions for MSC in these years and raised the cost of the steel industry; on the other hand, we managed to tap into

reverse engineering and make what we needed here at home. MSC has good experience in reverse engineering and has so far prepared more than 50,000 design maps and technical specifications.Luckily we inaugurated Hormozgan

Steel Complex, building on the country’s indigenous know-how. We provided about 80 percent of recent projects at home and installed and operated their equipment without foreign assistance. How do you think the nuclear agreement

or the Joint Comprehensive Plan of Action as it is called will affect Iran’s steel industry?Following the agreement some foreign

companies and banks have expressed readiness to invest in or finance the steel industry. Their number will rise [in the future]. The entry of foreign companies into Iran will not pose a threat to MSC which has been present in global markets as a brand [name] for years. As far as other industries are concerned,

I should say that the presence of foreign companies in Iran will be to the detriment of small industries if such a presence comes without the transfer of technologies. It can even lead to the shutdown of certain small businesses in Iran. That’s why the government should

not simply create a consumer market for foreigners; rather, it should include the transfer of technologies as an obligatory provision of its contracts and partnership deals with foreigners. In the capacity of the vice-president for

Project Implementation at Mobarakeh Steel Company, how can you summarize the major problems the country’s steel industry is grappling with? Supply of raw materials and energy,

especially water, is a big problem – although about two percent of water is consumed in industries and 92 percent goes to the agriculture sector. The steel industry is also grappling – among other things – with shortages in rail and road transportation. A lack of technology and research centers is yet another problem. We need to pay more attention to [and take bigger steps toward] setting up steel technology and research centers if we seek to produce alloy steel [specialty steel]. Does MSC have any new development

projects underway now? A pelleting project at Hormozgan Steel

Complex and a hot rolling project at MSC’s Shahid Kharrazi unit are our top priorities. We have also plans to raise production capacity at Saba Steel Company to 1.5 million tons per year from the previous 700,000 tons. I hope this plan will come on stream in September 2016. What about the water needs of MSC? Have

you taken it into account? MSC has minimized water consumption

by recirculating water in its systems and implementing drip irrigation. In addition to that, the company buys, treats and recycles urban wastewater and uses it in the production cycle to further reduce water consumption. Water consumption at MSC, which has

dropped by 68 percent, is below the world standards for the steel industry. MSC has allocated more than $65 million to buying wastewater of nearby towns, among them Mobarakeh and Zarinshahr. A large part of this project is under implementation now. Does MSC have other development

projects as far as its social responsibilities are concerned?Besides buying wastewater, Mobarakeh

is one of the investors in Naghsh-e Jahan Stadium [in Isfahan]. I represent Mobarakeh Steel Company in the stadium project. We hold meetings with provincial officials and a company which is in charge of development and maintenance of sporting arenas as well as officials with the Isfahan Provincial Education Department twice a month to review the progress of the project and help remove hurdles standing in the way. For a while, the progress at Naghsh-e

Jahan Stadium project was slow thanks to shortages of steel sheets. Provision of sheets will help the project gain momentum. Naghsh-e Jahan Stadium is part of

activities overseen by the Project Implementation Division. Tell us about progress in the project? We are now working on the stadium’s

lawn and trying to complete its metal skeleton. Naghsh-e Jahan Stadium had not been built in line with AFC criteria. Originally the entry tunnels were positioned behind the goals, so we reviewed the project in line with AFC’s latest standards and dedicated a place across the middle of the pitch to that purpose.We brought down the previously built parts, and now construction of the tunnel’s structure has gotten underway. The sheets needed for the stadium’s metal structures have been provided and the construction of the stadium is projected to get accelerated in two weeks’ time. When do you think Naghsh-e Jahan

Stadium will be inaugurated?We hope the first match attended by fans will have been played by the end of the year. Thanks to support by the MSC managing director, who constantly pursues the stadium project, I am optimistic that the match in question will take place this year. We at MSC will do what it takes to make it happen.

Local Firms Take Care of 80 Percent of MSC Projects

Investments continue into holiday seasonWhile demand for steel

has remained weak in most of the region with the holiday season, several prominent companies announced new or near-completed investment plans.Egypt’s Ezz Steel said that

its new direct reduced iron (DRI) plant in Suez will be launched in October this year, with 1.8 milliontpy capacity. The

company added that further investment plans will be announced after the launch.UAE’s Al Gharbia Pipe,

a joint venture between Senaat, JFE Steel and Marubeni-Itochu Steel, awarded engineering, procurement and construction (EPC) contracts to a consortium of SMS Group and Larsen & Toubro of India. The plant in the Khalifa Industrial Zone of Abu Dhabi (KIZAD) will haveproduction capacity for

240,000 tpy of large-diameter, high-quality, sour grade, longitudinally submerged arc welded (LSAW) steel pipes, chiefly for the oil and gas sector, and is planned to be operational by 2018. There has been considerable new investment in Turkish galvanizing capacity, spurred by the country’s expanding automotive sector. The country’s biggest flat-rolled steel producer, Erdemir, has ordered a second hot-dip galvanizing line from Primetals Technologies, for its Eregli facility. It is expected to start commercial production with 350,000 tpy capacity some 29 months after the contract was signed. Erdemir’s total HDG production capacity will be boosted to 650,000 tpy. Italy’s Danieli has announced that it will supply a new hot-dip galvanizing line to Turkey’s Tosyali Toyo elik, a joint venture of Turkey’s Tosyalı Holding and Toyo Kohan of Japan. The line willproduce 450,000 tpy

of HDG by the end of November 2016. Meanwhile, Turkish flat-rolled rolling mill and coater Tezcan Galvaniz is installing the country’s first Galvalume®(aluminium-zinc) line at

its facilities in Kartepe, close to Istanbul. The line will have 350,000 tpy production capacity for 0.30-3.0 mm thick Galvalume coils. Its target market is the construction sector, and it is planned to start production in mid-2016.

Middle East Steel

Major Chinese Mills Post Big first-Half losses Ilva Restarts No.1 Blast Furnace Member mills of the China Iron & Steel Association (Cisa) saw their

combined losses from their steelmaking business quadruple in the first half of 2015. Collectively, they incurred a loss of 21.68 billion yuan ($3.5 billion) in the first six months of this year, compared with a loss of 4.9 billion yuan ($800 million) a year earlier. Of Cisa’s 101 members, comprising mostly mediumsized and large steelmakers, 43 of them were in the red during the January-June period. China’s crude steel production may have peaked in 2014, with 410 million tonnes being produced in the first half of 2015, a 1.3% fall year-onyear, noted Zhu Jimin, Cisa executive vice-chairman.

Ilva has restarted its 2 million tpy No.1 blast furnace at its main site in Taranto, Italy, the company announced on 6 August. It will produce 5,400 tpd of iron. It was halted in December 2012 in order to be upgraded to comply with environmental standards. Ilva now operates three blast furnaces – Nos. 1, 2 and 4 – and will be able to produce 17,000 tpd. The No.3 furnace is being dismantled and the No.5furnace is also being modernised.

National

in Brief

NEWS

License Holder:Esfahan’s Mobarakeh Steel co.Managing Director:Mohammad Nazemi HarandiEditor:Ahmad NajjarExecutive Editor:Maryam PanahiEditorial Dept:Tel:+98-31-33327327Fax: +98-31-33327328email:info@msc.irwebsite:www.msc.irProduced by Isfahan Today Media co.Printed at Jamejam co.

STEEL NEWSLETTERMobarakeh

source:Metal Bulletin

The Managing Directors of the Ministry of Industry, Mines and Trade from all

across the country came together in Mobarakeh Steel Company on Wednesday, October 14, 2015. The meeting was also attended by the advisors to the Minister of industry, Trades and Mine, Dr. Goudarzi and Ms. Pouriamin, Ahmadieh, Director in Chief of the Ministry of Industry, Mine, and Trade, Dr. Bahram Sobhani, the Managing Director of Mobarakeh Steel, and a number of top executive officers of the various operative branches of the Ministry of Industry, with the main theme being the role of PR Directors in the promotion of non-oil exports, Growth National Product, and employment opportunities in line with the resistive economy tactics.Adviser to the Minister of

Industry, Mine and Trade:Media key role in industrialization

of the countries/The performance of the Public Relations Departments in Isfahan has been quite outstanding, which has placed them among the highest ranking of allAccording to the MSC reporter,

Dr. Goudarzi, the Advisor to the Minister, and the Head of the Information and Public Relations Department of the Ministry of Industry, Mine, and Trade regarding the significance of the meeting had this to say, “One of the most serious issues we face today is the emergence of a new continent; the sixth continent, which is nothing but the cyberspace and media. Soft power has been shaped in the form of media space, and its pull intensifies every day. Today those who are pursuing politics and economic decision-making, consider the most power country to be the one with the most advanced media discourse and believe that active engagement and dialogue in terms of media influence, can be the benchmark for political, economic and social fields. Studies suggest that the top 20 countries in terms of economic development are the ones with the highest capital investment in networking and Communication, and have had the highest level of power in the media world and

control giant media corporations. In fact there is a full-fledged war on globalization, opening of the markets and industrial development going on through the media outlets therefore the news networks play a key role in industrialization of countries. He pointed to the remarks

made by the Minister of industry, mines, and trade regarding the importance of holding the conference and achieving the objectives of the meeting and stated that, in this regard Mr. Nematzadeh called for convergence and solidarity among the managing director of the organization in public relations and information departments, and emphasized the need for reengineering, changing and reforming of the structure, and hiring highly qualified experts to better respond to the needs.The minister’s advisor and

director of the public relations and information of the Ministry of industry mines and trade expressed satisfaction with the overall conference and clarified that, “ as per the request of the Minister of industry, mines, and trade, we are to hold quarterly briefings for the managers and biannual meetings at the provincial level providing progress reports. To this end we have implemented a ranking system

evaluating the public relations department based on which the public relations department of Isfahan province came on top.Other purposes of holding

such meetings by the Ministry of industry, mines and trade is to create cultural awareness, promoting scientific breakthroughs in the field of communications. Today the scope of public relations as a science has become so broad, the past communication used to be limited and confined and the company’s PR managers were paid little if any attention by the managing directors and CEOs but now the Board of Directors of the organizations and huge corporations has an indispensable member and one of the main players on the Board of Directors are the heads of public relations. Giant conglomerates have them on top of the corporate pay list of costs and wages, which shows us that we need to completely change our outlook toward the importance of communication and organization.Dr. Sobhani Managing Director of

Mobarakeh SteelIn Mobarakeh Steel, the duty of

public relations is “communication with the public.” According to the same report later

in the meeting Dr. Sobhani, the Managing Director of Mobarakeh Steel expressed satisfaction

with the conference, and talked about the importance of public relations to Mobarakeh Steel and stated, “fortunately since the beginning of the establishment of administrative infrastructure in Mobarakeh Steel Plant, effective public relations was included in the job description, and a requirement for the managerial post. The Public relations Department is the bridge that joins the company to the people, and providers of the real-time progress report of the achievements and performance of the company. A bridge that connects the organization and the people, the staff, the clientele, customers and stakeholders in general and sometimes on a global scale.”“Public relations get the

comments and suggestions of the people across to the managers and the responsible parties will continue to resolve the weakness of the company, to establish themselves as one of the most trusted members of the community to inform the public of the progress made by the company; and this would be the true mission of PR departments.” He asserted.He expressed the hope that after

the negotiations are finalized in the new atmosphere created, public relations could better plan to improve the business

environment and take up a larger share of GDP in the Ministry of Industry, Mines and Trade, leading the glorious Islamic country of ours towards perfection and making it proud.”Mohammad Nazemi Harandi, PR

Manager at MobarakehConference of the Director of

Public Relations of the Ministry of Industry, Trade and Mines is an opportunity to achieve greater solidarity and unity. According to the statement

made in this regard to the reporter of the Steel Plant, Muhammad Nazemi Harandi, public relations director of Mobarakeh Steel announced that, “the meeting provided an opportunity for the managers under the Ministry of Industry, Mines and Trade, given the important role of the section in the ministry, and in the economy, especially in post-sanctions era to transfer experiences, exchange ideas and identify the challenges and problems in the field of Information and media and providing guidelines for the support of non-oil exports, GNP and employment with economic approach of the resistive economy, which will further be cleared up through workshops that will be held on Wednesday and Thursday, October 14 to 15.”“In Mobarakeh Steel Company, the process of ‘communication and social responsibilities’ through public relations, and in cooperation with other units has been effectively implemented, the main outcome of which has been reaching full and proper understanding between the organization and its stakeholders.” He continued.Mobarakeh Steel’s public relations director called the meeting an effective step for improving the working environment and better cooperation with the related organizations under the Ministry of Industry, Mines and Trade, and said, “here at the meeting with the PR directors of the Ministry of Industry, Mines and Trade all present, the opportunity has been created for the coordination and integration of the various PR departments to advance communications, and the quality of work relations.

PR Managers of the Ministry of Industry, Mine and Trade’s Nationwide Summit inMobarakeh Steel Company

Managing Director of Metal Bulletin Events Luke Gibson has said that the ground is prepared for the steel and minerals produced in Iran to make it to the competitive market. The Public Relations Office of the Iranian Mines and Mining Industries Development and Renovation (IMIDRO) quoted Gibson as telling reporters on the sidelines of Iran’s first Iron and Steel Conference on Kish Island that the stage is set in Iran to produce mining products – among them steel – thanks to its skilled workforce, rich energy resources and minerals.

South Korea’s Posco and China’s Chongqing Steel have signed a memorandum of understanding (MoU) to jointlyset up a cold rolling and galvanizing line in Chongqing. The 6.2 billion yuan ($997 million) project in southwest China’s Chongqing municipality will produce high-grade CRC and HDG for the automotive and home appliances sectors, with a capacity of 2.4 million tpy. Posco will hold a 10-25% stakein the CRC part of the joint venture and a controlling 51% in the HDG investment. The MoU requires approval by bothcompanies’ boards and relevant agencies. The two compa-nies are already cooperating on a 50:50 joint venture Finex plant in Chongqing, to produce 3 million tpy of automotive steel and high-end wire rod.

The Management Committee of the Mobarakeh Steel met on Saturday, October 10, 2015. The meeting was attended by the CEO, deputies di-rectors and district managers and chiefs of staff of the Mobarakeh Steel production plant and af-ter the performance reports and current issues of the districts were submitted by the manag-ers, Dr. Sobhani, the CEO of Mobarakeh Steel Company put forth operating strategies for par-ticipation in the domestic and foreign markets and went over the strategies for coping with the downturn in the global steel market.Dr. Bahram Sobhani pointed to the importance of cost management, product diversification and price competitiveness and said, “in many cases, despite the appearance of things, and with undesirable circumstances at hand, some organizations come up with strategic changes and plans of cost control in the most difficult conditions, and manage to pass his slump and steep slopes remain in the competitive race even though it may result in some sections yielding less profit or even no profit in sales for their products, but what is certain is that they stay the course, and carry though until favor-able conditions are restored.”Mobarakeh Steel Managing Director noted that, “due to market conditions, as pointed out before, we need to focus on the export markets, and be much more steadfast than be-fore. If more specialized task force is needed, we will form one. In case we need better units and areas, we will build them. As for the pro-duction costs, and current expenditures in var-ious sections, we will do whatever it takes to take them under control. This can only be pos-

sible through cooperation and teamwork of all the groups and units. Let us not forget that in order for the country’s steel industry to com-pete in the global markets, we all need to work together cooperatively, with great determina-tion and be unified in all sectors of take action to reduce costs. We have to make the most of what we have.”He also emphasized the importance of identify-ing problems and further highlighted, In order for the Steel Industry to make any progress, we should first identify the weaknesses and come up with solutions that are both efficacious and practical. Reports must be submitted for all the activities and their outcomes, which accurately demonstrate the strengths and weaknesses. The information and reports must be made available to all the managers and employees on the conditions that are tangible and thus can be acted on accordingly to manage the external costs and surplus. Without a doubt, we can only be successful in the way that all organizations are ubiquitous in this way, working in solidarity.In another part of his speech as one of the ways of improving the quality of products at competi-tive markets he said, “It is very important that we can manufacture all kinds of steel sheets in the different thicknesses, with the best quality, making customers satisfied to produce a com-petitive edge. Of course this is going to provide our customers with the resources they need and products that require maximum quality in all ar-eas to respond better to market needs, product variety and quality, production of steel sheets, corrugated, stainless steel with higher added value.

We can rest assured there will be no miracles in a weak market unless we change ourselves in order to respond to the needs of customers. Be-cause of our strong competitors, we should be providing greater customer satisfaction.He noted that with the existing equipment, we

can produce products that add value and bring greater productivity to revenue, and with con-trol and energy costs and the price of raw ma-terials at our disposal, but the control and man-agement of costs and other things are all in our power and within our grasp.

Metal Bulletin: Iran is Apt to Produce Competitive Steel

Minnesota Iron OrePellet Plant to Start in

Posco and Chongqing

Sobhani Emphasized to the Management Committee of Mobarakeh Steel Company:

Diversity of Products,Better Marketing and More Efforts

Essar Steel Minnesota’s mine and taconite pellet plant proj-ect in Minnesota’s Mesabi Iron Range is about 80% complete, with start-up scheduled for mid-2016. The Nashwauk, Min-nesota, facility has already signed supply contracts for its entire production capacity of 7 million tpy of iron ore pel-lets. ArcelorMittal’s North American operations will receive 4.5 million tonnes, while Essar Steel Algoma will receivethe remaining 2.5 million tonnes – both under ten-year con-tracts. Essar Steel Minnesota hopes to have the flexibility and production capability to produce direct-reduced grade pellets for direct-reduced iron production, in addition to standard and fluxed pellets for blast furnaces, its president and coo said. The company expects to be the cheapest pro-ducer of taconite pellets in North America.