August 7th (Steel Guru) – It is reported that the Kudremukh Iron Ore Company Limited has created a railway unloading facility at the marshalling yard of New Mangalore Port Trust.

Mr K Ranganath C MD of KIOCL said that the company has laid exclusive railway lines for handling iron ore brought from Bellary by rail rakes.

He said that “We are expecting to get at least 2 or 3 rakes of 3,000 tonnes each a day. Presently railway wagons are moving through Konkan railway facilities.”

August 4th (Mineweb) – The North West Iron Ore Alliance has further outlined its case for the establishment of third party infrastructure access in the Pilbara, today announcing it has submitted responses to the recent draft recommendations from both the Pilbara Rail Access Interdepartmental Committee (PRAIC) and the National Competition Council (NCC).

The Alliance announced today (Monday) that it intended to play an active role in shaping the framework for a third party access regime by participating in the PRAIC and NCC consultation processes, and remained strongly committed to working towards a constructive solution with other stakeholders in the Pilbara. 

Independent Chair of the North West Alliance, Ms Megan Anwyl, said access to existing infrastructure remained a fundamental necessity to the formation of a sustainable, viable and successful junior iron ore industry in the Pilbara.

“We believe that BHP Billiton and Rio Tinto have a legal obligation to allow rail haulage to third parties under their various State Agreements, and that this would lead to a healthy diversification of the iron ore industry in the Pilbara and better social and economic outcomes for its residents and the nation as a whole,” she said. 

“If fair and equitable infrastructure access is not granted, some mine sites would not be financially viable, or production could be severely limited due to the environmental, social, financial and potential licensing restrictions relative to the trucking of iron ore,” Ms Anwyl continued.  “Further, the State Government has a clear policy preference towards rail over road transport.”

“The four members of the North West Iron Ore Alliance – Atlas Iron, BC Iron, Brockman Resources and Ferraus – therefore have an obligation to their shareholders to negotiate a workable solution for the transportation and shipment of their ore through the Pilbara,” she commented.  “We have been very encouraged by the draft PRAIC regime and NCC recommendation, and look forward to providing further input towards the final outcomes through the responses we have submitted.” 

Ms Anwyl said one of the key PRAIC recommendations the Alliance had made was to support the need for the appointment of a strong Regulator to ensure a timely, effective and equitable access regime.

“It is important that the interests of all parties are balanced, and that there is an independent body to ensure that this balance is maintained,” she said.  “The North West Iron Ore Alliance therefore supports the need for a strong Regulator who would be responsible not only for approving such factors as the pricing and costing of the rail haulage regime, as but also for key issues such as capacity and service level principles, safety principles and capacity modelling principles.” 

The North West Iron Ore Alliance was formed in 2007 to support the development of a junior iron ore sector in the Pilbara. The member companies – Atlas Iron, BC Iron, Brockman Resources and FerrAus – have agreed to cooperate on issues such as infrastructure development and access, statutory approvals and community development. 

Collectively the members of the North West Iron Ore Alliance have the potential to deliver over 50 million tonnes of iron ore per annum by 2014, generating approximately $165 million in State royalties per annum.

August 4th (Reuters) – Brazilian iron ore miner Vale (VALE5.SA: Quote, Profile, Research)(RIO.N: Quote, Profile, Research) has ordered a dozen of the largest class of ore carriers from a Chinese shipbuilder for $1.6 billion, aiming to boost business with fast-growing Asian customers.

Vale, the world’s largest iron ore miner, expects the huge vessels to reduce shipping costs and make its ore more competitive with nearer Australian and Indian ore for the fast-growing Chinese steel industry, already the world’s largest.

 

“Looking at the expansion projects we have and (what) other players are doing, we don’t see the level (of ore demand) will be down for the next 2-3 years,” Eduardo Bartolomeo, Vale’s executive director for logistics, told reporters.

 

Vale said it ordered 12 very large ore carriers from Jiangsu Rongsheng Heavy Industries Co Ltd, each with a capacity of 400,000 deadweight tonnes. Delivery of the first is expected in early 2011 and the order is due to be completed by 2012.

 

The carrier programme adds to Vale’s previously announced global investment programme of $59 billion for 2008-12, as it aims to boost iron ore output by 50 percent to 450 million tonnes by 2013.

 

Vale has said it planned to ship more than 100 million tonnes of iron ore to China in 2008 under term contracts, a rise of 10 percent from 2007.

 

China’s crude steel output this year is forecast to rise about 10 percent to 550 million tonnes.

“So what we are doing is to find that option that gets iron ore closer. What we are doing is to stimulate steelmakers to build larger ships,” Bartolomeo told a media briefing, adding that Vale would outsource the operation of the fleet.

 

Asian steel mills’ negotiations with ore miners on annual term iron ore prices in 2008 stalled over the proposed inclusion of a freight premium sought by the Australian miners to reflect the higher shipping costs to China for Brazilian ore.

 

Bartolomeo said the large vessels would help Vale, which shed its sea transport operations in 2001, to address logistics shortcomings and better compete with global rivals such as BHP Billiton (BHP.AX: Quote, Profile, Research)(BLT.L: Quote, Profile, Research) and Rio Tinto (RIO.AX: Quote, Profile, Research)(RIO.L: Quote, Profile, Research).

 

The Australian companies received higher price increases than Vale in annual iron ore supply contracts with Asian steel mills for 2008.

 

“We’re trying to correct it — not the premium, but the freight rates,” Bartolomeo said. “I’m not happy with the freight levels. I don’t think they represent the actual cost of transportation.”

 

The Baltic Exchange chief sea freight index .BADI for global raw materials trade soared to a record 11,793 points in May, although it has since eased to 8,280 on Friday.

 

Vale, formerly Companhia Vale do Rio Doce (CVRD), said the new vessels would be part of a Brazil-Asia shuttle service with 18 very large ore carriers able to haul a combined total of 7.1 million deadweight tonnes.

 

The fleet will be able to carry an estimated 30.2 million tonnes of iron ore per year from Brazil to Asia, equivalent to 31 percent of the company’s shipments to China in 2007, Vale said.

August 1st (ABC News) – A fully loaded iron ore carrier has run aground at Port Hedland. The Iron King carrier is understood to be leased by the Fortescue Metals Group and was carrying 160,000 tonnes of iron ore when the incident happened last night.

The Executive Director of Operations at Fortescue Metals, Graeme Rowley says the carrier had been loaded and was leaving the Port when it appeared to lose steering. “It has gone and hit the edge of the channel and is stuck waiting for the next high tide,” Mr Rowley said.

The carrier was travelling about seven knots at the time and was on its way to China. Mr Rowley says no-one was injured and at this stage there are no reports of any hydrocarbon leaks. He says divers are on their way and will inspect the ship for damage after it has been refloated. The Port Authority will attempt to refloat the carrier at the next high tide. The stricken vessel is blocking two other carriers which were trying to enter the harbour to load.

July 31st (Steel Guru) – It is reported that Zhejiang Zhoushan Wugang Dock Corporation Limited was officially set up on the morning of July 28th in Hangzhou, Zhejiang, marking the Zhoushan Liangtan Island Iron Ore Transfer Terminal project has entered into the substantial operation term.

As per report, the new established company was built up jointly by Wuhan Iron & Steel Group Corp, Ninbo Port Group Limited and Zhejiang Herun Industry Group Co Ltd. The venture will invest a total of no more than CNY 2.4 billion in the large scaled iron ore transfer terminal which is projected to deal with 30 million tonnes of resources each year, including a 300,000 tonnes unloading berth, a 50,000 tonnes boat berth and two first tier stocking yards. It is expected that the first phase construction will be completed and put into service in the second half of 2009.

Mr Bai director with WISCO’s publicity department said that Chinese ports are appearing straitened upon increasing imported iron ore reflecting domestic high demand. WISCO hadn’t got its own transfer terminal yet before, as learned. It had to pay a higher transportation fee, with only the fine for overtime of anchoring hitting over CNY 100 million a year. Once the project is finished, the new port will help WISCO tackle its problem.

July 27th (The West Australian) – The WA Government is poised to make one the most contentious decision of its seven-year reign next week when Planning and Infrastructure Minister Alannah MacTiernan announces the preferred developer of a $1.5 billion port at Oakajee, north of Geraldton.
  
The announcement is expected on Tuesday, the final day of a two-day State Cabinet meeting in Geraldton.
  
After more than two decades of dithering about the viability of a port, next week’s announcement should signal the long-awaited go-ahead for a multi-user facility capable of underpinning the development of the Mid-West’s iron ore province.
  
But Ms MacTiernan’s announcement is also expected to stir fresh controversy only months out from a likely State election.
  
One of the two proponents, Yilgarn Infrastructure, is heavily backed by the Chinese Government, raising concerns in some quarters about China’s increasingly far-reaching grab for WA’s resources sector.
  
The other proponent, Oakajee Port & Rail, is owned by Japanese trading giant Mitsubishi and iron ore aspirant Murchison Metals, sparking separate concerns its ownership of both the port developer and a mine would raise conflicts of interest and disadvantage other miners wanting to use the port.
  
Ms MacTiernan has said the way she structured the Oakajee tender would ensure that nationality of the winning bid is immaterial — ownership of the port’s key multi-user components such as breakwater and channels would revert to the WA Government after project completion — and that the Geraldton Port Authority, which would operate Oakajee, would ensure fair access for all users.
  
Even with confirmation of a preferred Oakajee tender, significant hurdles remain.
  
Ms MacTiernan expects to spend until the end of the year negotiating a final development deal with the chosen party and financing of the $1.5 billion project, notwithstanding both proponents’ claims that funds are locked in, is likely to be a focus given the global credit crunch. It is hoped port construction can begin next year, with completion targeted by 2012.
  
A finished Oakajee should be capable of initially handling 30 million to 35 million tonnes of exports at year, with much of that to come from Murchison, the Sinosteel Corp-controlled Midwest and Gindalbie Metals.
  
Sinosteel yesterday extended the takeover deadline for its $1.4 billion cash bid for Midwest by a month to August 25 in the hope of snaring the few remaining minority shareholders.
 
Having bought an additional three million shares on market yesterday, Sinosteel’s stake has been boosted from 54 per cent to about 55.9 per cent and it continues to hold out for Midwest deputy chairman David Law’s 13.2 per cent stake.

July 24th (Steel Guru) – According to the East Coast Railway sources heavy rains have badly affected loading and movement of iron ore rakes in Chhattisgarh, Andhra Pradesh and Orissa.

As per report the iron ore loading at National Mineral Development Corporation’s mines in Chhattisgarh has been badly hit, as a result fewer rakes than normal are being moved on the 450 kilometers long Kirandul Kottavalasa line. Right now, on an average, 8 to 10 rakes are being loaded and moved on the route against 15 to 16 in normal situation.

According to the ECoR sources, iron ore loading in Daitari Banspani area and transportation of it to Paradip port for exports has also been hit as rains have affected normal operation in the mines as well as the port. As many as 13 rakes, earlier loaded with iron ore for exports, have been detained at various points on the route from the mines to the port. The iron ore rakes already in the port are discharging cargo slowly because of the rain. This has also slowed down back loading of imported coal as the same rakes, which carry iron ore to the port for exports, are used for back loading of imported coal.

The loading of thermal coal at Talcher mines, after having remained suspended for several days due to strained industrial relations problems, resumed recently and on an average 24 rakes were being loaded per day. Only concern of ECoR is that BOBR rakes, the dedicated rakes used for transportation of thermal coal to Paradip for coastal shipments, do not get detained at the port due to bad weather.

Mr K Raghuramaiah chairman of Paradip Port Trust said that the rains have not stopped operation of the port, but have only slowed it down. Despite a plethora of problems thrown up by the inclement weather, about 4 to 6 iron ore rakes are being loaded and that many rakes are being used for loading imported coal, observed Mr Raghuramaiah, adding that as far as the BOBR rakes are concerned, there is no problem.