flanders-china chamber of commerce

China to set up nonferrous metal bases abroad

agx — Thu, 23 Feb 2012 06:50:07 +0000

China will develop overseas nonferrous metal bases and phase out obsolete industries during its 12th Five Year Plan (2011-2015), the Ministry of Industry and Information Technology (MIIT) said. “In overseas markets, China will encourage capable Chinese enterprises to explore copper, aluminum, zinc, nickel and titanium resources and speed up the process of setting up overseas nonferrous metal supply bases,” the Ministry said. Last year CITIC Group signed a strategic cooperation agreement with Bolivia to jointly explore lithium resources in Bolivia’s Coupasa salt flats. Copper, aluminum, lead, zinc, nickel, tin, antimony, titanium, mercury and magnesium account for more than 95% of China’s nonferrous metal output and more than 85% of the sector’s sales revenue. MIIT noted that the electrolytic aluminum industry has faced overcapacity since the 11th Five Year Plan (2005-2010). In 2010, the sector ran at just 70% of maximum capacity.

Zhongwang to export more aluminum products

agx — Thu, 23 Feb 2012 06:49:33 +0000

China Zhongwang Holdings, the world’s second-largest manufacturer of aluminum extrusion products by volume, has set a goal of increasing the volume of its exports to the United States five-fold in 2012. The company will sell up to 50,000 tons of aluminum products overseas this year, mainly to the U.S., said Chief Financial Officer Vincent Cheung. The percentage of overseas sales in the company’s total sales is expected to grow from 2% in 2011 to more than 10% this year. “We are now discussing with our U.S. clients how to adjust our product types for the U.S. market, which will help us to avoid anti-dumping and anti-subsidies duties on Chinese aluminum products,” said Cheung. In March 2010, the U.S. Department of Commerce started anti-dumping and anti-subsidies investigations into Chinese aluminum products. The department decided to impose anti-dumping tariffs of 33.28% and anti-subsidies tariffs of 374.15% on several types of Chinese aluminum exports to the U.S. in March 2011. The moves have hurt Chinese exports. In 2009, Zhongwang’s sales revenue in the U.S. market was CNY5.66 billion, accounting for 40.8% of the company’s total revenue. The company’s sales revenue dropped to CN3.07 billion in 2010, a year-on-year decline of 29.1%. After adjusting its products and marketing, China Zhongwang realized revenue of CNY6.63 billion by the end of the third quarter last year, an increase of 52% over the same period in 2010. While focusing on the domestic market, the company will also raise exports. Flat-rolled aluminum products will be the new growth area for the company. Commercial production is expected to start in 2014, with an annual production capacity of 1.8 million tons. China, the world’s fastest-growing market for flat-rolled products, will consume 14 million tons of the material in 2020, accounting for as much as half of global consumption. Flat-rolled aluminum products are mainly used in the manufacture of automobiles and cans. China depends largely on imports. Aluminum Corp of China is the country’s biggest manufacturer of flat-rolled aluminum products, the China Daily reports.

Nonferrous metals index to be launched

agx — Thu, 23 Feb 2012 06:48:38 +0000

China will launch its first composite index of nonferrous metals sometime this year to help companies avoid risks. The index will be calculated using data for output, sales, prices, imports and exports, reported by domestic nonferrous metal production and trading companies, said a source at the China Nonferrous Metals Industry Association. “Because price gaps among different nonferrous metals are huge, it is hard to reflect the overall picture of the industry in one index,” said Jia Mingxing, Secretary General of the Association. The exact method of calculation is still being discussed. Separately, the Shanghai Futures Exchange will accelerate the listing of silver this year. In March 2011, lead futures were listed on the exchange. The addition of silver would mean that all four major nonferrous metals would be listed: silver, copper, aluminum and zinc. The Association forecast that average domestic nonferrous metals prices would be lower this year than in 2011, especially in the first quarter and even in the first half. China’s electrolytic aluminum companies are facing a severe challenge as the National Development and Reform Commission (NDRC) raised electricity rates twice in 2011, pushing up production costs for these energy-intensive companies. Power costs accounted for about 20% of the total costs of overseas producers, but the proportion was 45% to 50% for domestic companies.

Short news metals

agx — Thu, 23 Feb 2012 06:47:56 +0000

Angang Steel Co has estimated a net loss of CNY2.15 billion for 2011, joining other Chinese mills in reporting dismal results. The company, based in Anshan, Liaoning province, attributed the huge loss to high-cost feedstocks and output loss from maintaining its blast furnaces, said a Hong Kong stock exchange filing. Angang reported a net profit of CNY2.05 billion in 2010. Maanshan Iron and Steel Co and Nanjing Iron and Steel Co said their 2011 net profits may fall more than 50%. Shanghai’s Baoshan Iron and Steel Co said last month that its unaudited 2011 net profit tumbled 43% to CNY7.3 billion.
Mining company Xstrata and commodities dealer Glencore agreed to a USD90 billion merger that will create the world’s fourth largest natural resources company, with operations in 33 countries. The new company would be the world’s third-largest copper producer, fourth-largest nickel producer and the global leader in thermal coal, ferrochrome and integrated zinc production. Xstrata Chief Executive Mick Davis will become CEO of the merged company. He expects the merger to complete in the third quarter of this year. Glencore CEO Ivan Glasenberg will become Deputy CEO and President of the new company to be named Glencore Xstrata International.
Baoshan Iron and Steel Co plans to raise product prices next month after keeping them basically flat for January and February, on expectation of a pickup in seasonal demand and in response to rising costs. It will raise hot-rolled coil and cold-rolled coil prices by CNY150 a ton for next month.
Oversupply in China’s steel industry would continue this year, said Maanshan Iron and Steel General Manager Su Jiangang. China could not put in place economic stimulus measures similar to those it enacted in 2008, Su added. Maanshan needed to improve its cost efficiency and expand the non-steel businesses, and it was looking at making wheels for high-speed trains.
Baosteel Group has mandated Bank of China (BOC) as lead manager and book-runner for a proposed yuan-denominated bond offering. The company sold CNY3.6 billion of yuan-denominated bonds in Hong Kong last November, the largest corporate issuance of a yuan bond in Hong Kong. The proceeds of the latest issue would fund expansion of its resources unit Baosteel Resources (International) which was set up a year ago.
An explosion rocked a steel plant of Angang Steel Heavy Machinery Co on February 20 in Anshan, Liaoning province, killing at least 13 workers and leaving another 17 injured. The accident happened when a 10-meter-wide mold exploded at a steel-casting workshop when workers were about to finish casting a ring-shaped piece of steel. The temperature inside the mold was more than 1,000 degrees Celsius at the time.
China plans to develop rare-earth-based new materials during the 2011-2015 period, according to a five-year plan for the new materials industry. It also set goals to lift the output capacity for rare earth permanent magnet materials by 20,000 tons a year and that of rare earth hydrogen-containing alloy powder by 15,000 tons a year. The plan also sets higher output goals for a range of other new materials that contain rare earth metals.

Minmetals seals CAD1.3 billion deal for African copper miner

agx — Thu, 23 Feb 2012 06:46:27 +0000

China’s Minmetals Resources (MMR) has succeeded in its CAD1.3 billion bid for Africa-focused copper miner Anvil. Minmetals, a unit of China’s biggest metals trader, wanted Anvil for its Kinsevere project in the Democratic Republic of Congo, which is expected to produce 60,000 tons of copper cathode a year. “Anvil is the first step in the expansion of MMR’s global footprint,” Andrew Michelmore, Minmetals’ Melbourne-based Chief Executive, said. Minmetals has been looking to expand beyond its holdings in Australia and Laos, and last year missed out on a USD6.6 billion bid for Canadian miner Equinox Minerals when it was trumped by Barrick Gold. Both Equinox and Anvil have mines in central Africa’s rich copper belt, where several other mines are being developed by firms like China’s Jinchuan Group, which recently took over South Africa’s Metorex. Michelmore said Minmetals would be interested in other assets in the African copper belt. “We bid for Equinox, now we’ve got Anvil, so we’re interested in that part of the world,” he said. The firm would continue looking for copper, zinc and nickel sulphide assets in Africa, North and South America, parts of Asia and Australia, he said. He added the company would target assets in varying stages from exploration projects to mines near completion. The biggest hurdle to the Anvil takeover was cleared when Minmetals secured an agreement with Congo’s state-owned mining body Gecamines confirming that Anvil’s title to the Kinsevere and Mutoshi copper and cobalt projects were valid and in good standing. Gecamines had almost scuppered the deal when it said the takeover would trigger a review of the projects’ leases. Minmetals acquired 90% of Anvil’s shares and would move to take over the remaining shares as allowed under Canadian and Australian rules. Anvil had been up for sale since last August, when its biggest shareholder, commodities trader Trafigura, said it wanted to sell its 39% stake. China accounts for nearly 40% of global copper consumption and demand is expected to rise 6% to 7% this year, the South China Morning Post reports.

Fortescue confident China’s iron demand will stay high

agx — Thu, 23 Feb 2012 06:45:44 +0000

Australia’s Fortescue Metals has shrugged off worries about a slowdown in Chinese demand for iron ore, vowing to stick with a USD8.4 billion mine expansion plan and forecasting steady prices for the material. Fortescue, which has only been producing ore since 2008, sells 95% of its output to Chinese steel mills, the world’s biggest buyers of iron ore, and plans to nearly treble production by mid-2013. BHP Billiton and Rio Tinto are also boosting production, leading analysts to forecast a medium-term glut of iron ore amid signs that China’s demand growth for the metal is easing. Spot iron ore prices fell 19% in 2011 as China clamped down on liquidity, denting steel demand for construction, and have been fairly steady this year at about USD140 a ton. Fortescue Chief Executive Nev Power said the firm was counting on China to remain a big buyer in coming years. “Long term, China’s growth is forecast to be stable around the 9% mark and we don’t see significant new supply to come into the market in the short term, and, therefore, expect the price to remain in that range,” he said. Indian iron ore exports to China were dropping off due to tariffs and growing demand at home, while domestic Chinese iron ore output was expected to fall in favor of higher iron-content imported ores, he said. Fortescue, Australia’s third-largest iron ore miner, reported a half-year net profit of USD801 million, more than double a year ago but below analysts’ expectations of about USD840 million. Power declined to comment on speculation that a potential predator may be building up a stake in the company after a mystery buyer snapped up at least 2.9% of Fortescue’s stock. Andrew Forrest, who founded Fortescue in 2003, is the largest shareholder, with nearly 32% of the firm. Hunan Valin, a Chinese state-owned steelmaker, is second-ranked, with 14.7%, the South China Morning Post reports.

Short news minerals

agx — Thu, 23 Feb 2012 06:44:55 +0000

Guangxi surpassed neighboring Guangdong to be the country’s largest importer of coal in 2011. Local customs said ports in Guangxi recorded throughput of over 27 million tons in 2011, up 61.3% over the previous year and accounting for 15% of the total. Guangxi’s coal was mainly imported from Vietnam, Indonesia and Australia last year. The province’s imports from Vietnam jumped by 42.8% to 11.7 million tons, which customs officials attributed to the price advantage of Vietnam’s coal.
Angola’s government hopes to expand its nearly USD1 billion a year diamond business in partnership with Chinese firms through Angola Diamond Trading (Sodiam), which is 99% owned by Endiama, a state-owned diamond miner. Angola is expected to produce 8.5 million carats worth USD1.15 billion this year. In 2010, Dubai accounted for the largest share of Angolan rough diamond exports by value at 40%, followed by Israel at 34%, and China at 11%.
China has raised the resource tax on six minerals, including iron and tin ores, in a bid to conserve reserves, but analysts said the hikes won’t have a big or long-lasting impact on costs given already high mineral prices. The benchmark tax ranges from CNY2 to CNY30 per ton depending on ore grade. New rates became effective on February 1. The resource tax on top-grade tin ore was lifted to CNY20 per ton, a 20-fold jump and the biggest increase among the six minerals affected. China also raised the tax on molybdenum, magnesium, talc and borax ores.

Meeting with Chinese delegation: “Leadership in Low-carbon Growth”, 16 February 2012, Antwerp

agx — Mon, 20 Feb 2012 10:36:49 +0000

The Flanders-China Chamber of Commerce and the Flanders Cleantech Association organized a meeting with a delegation led by a group of Chinese mayors of second and third-tier cities in China. The Chinese mayors were from the following cities: Lanzhou (Gansu province), Guiyang (Guizhou province), Zhuhai (Guangdong province), Inner Mongolia Autonomous Region.

The visit was organized in the framework of an exchange programme of The Climate Group, which is an organization based in the UK with offices worldwide, including Beijing and focusing on climate change and low carbon area. The aim of their visit was to facilitate the dialogue, trade and investment between Chinese cities and Europe on cleantech and environmental technologies.

The participants were welcomed Mrs Gwenn Sonck, Executive Director of the Flanders-China Chamber of Commerce. This welcome was followed by an introduction by Mr Dirk Fransaer, Managing Director of VITO. Mrs An Vandeputte, Project Manager of OVAM/Public Waste Agency of Flanders gave an interesting presentation on the policy instruments and results in waste management in Flanders. Mr Daniel Dirickx, Director of the Hooge Maey explained the meaning of sustainable landfilling. Mr Bert Lemmens, Project Manager Renewable Chemicals of VITO showed how to obtain renewable chemicals from algae. To end the presentations, Mr Karl Vrancken, Research Coordinator of VITO gave his view on Enhanced Landfill Mining as a new concept for sustainable materials management.

After the presentations the delegation visited the site of the Hooge Maey. After the site visit the delegation and the Belgian companies had a lunch with a presentation by Mr Luc Bas, European Programme Director of The Climate Group. During the lunch, the Belgian companies were able to present themselves and their activities to the delegation.

This meeting was organized with the support of Flanders Investment & Trade. Pictures of this meeting will be online soon.

FCCC Chinese New Year reception, 16 February 2012, KBC Bank, Brussels

agx — Mon, 20 Feb 2012 10:36:04 +0000

The Flanders-China Chamber of Commerce organized a successful New Year’s reception on 16 February 2012 at KBC Bank in Brussels, attended by 300 participants.

Speeches were made by:

Mr Bert de Graeve, Chairman of the Flanders-China Chamber of Commerce (FCCC)

His Excellency Mr Liao Liqiang, Ambassador of the People’s Republic of China in Belgium

Mr Didier Reynders, Vice Prime Minister and Minister of Foreign Affairs, Foreign Trade and European Affairs

Pictures of the reception will be online soon.

CIC rejects buying European governments’ bonds

agx — Mon, 20 Feb 2012 08:26:27 +0000

Lou Jiwei, Chairman of China Investment Corp (CIC), China’s USD410 billion sovereign wealth fund, said investing in European government debt was “difficult” for long-term investors. He said any fresh injection of funds into Europe would be in industrial and other real assets, not government bonds. German Chancellor Angela Merkel had asked CIC and other long-term investors to buy European government debt when she visited Beijing earlier this month. “For European bonds like the government bonds of Italy and Spain, only central banks with certain responsibilities can invest,” Lou Jiwei told the annual meeting of China Economists 50 Forum. “We may be poor, but we aren’t stupid,” Xia Bin told reporters at the forum. “We must follow commercial principles in making such investments. That means we want returns.” Premier Wen Jiabao didn’t make any explicit commitments during Merkel’s visit, although he said China was willing to help Europe cope with its debt crisis. CIC has received a capital injection after it invested almost all of its cash in 2010, said CIC Chairman Lou Jiwei, without disclosing the amount of the infusion.