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US steelmakers seen returning to growth in 2017

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US steelmakers seen returning to growth in 2017

TOP NEWS

US steelmakers expected to return to growth in 2017, say analysts

Steelmakers in the U.S are expected to return to growth in 2017, with production and demand seen increasing thanks to lower imports due to protectionist measures, the Financial Times predicted based on a survey of 20 analysts. Crude steel output is expected to increase 4.4% on a yearly basis in 2017, compared to almost two years of contraction. U.S. steelmakers such as Nucor Corp., U.S. Steel Corp. and AK Steel Holding Corp. have been struggling since steel prices started collapsing 2015, triggered by overcapacity, lower raw material prices and low-cost imports.

Former Chalco exec jailed for 16 years

Sun Zhaoxue, a former vice chairman of Aluminum Corp. of China Ltd., was sentenced by a Chinese court to jail for 16 years for graft, Reuters reported, citing a court statement.

Mechel completes debt restructuring with state banks

Mechel PAO extended until 2022 the maturity on 70.2 billion Russian rubles of credit lines with VTB Bank. Payment on the debt was extended to the first quarter of 2020, with repayment by the first quarter of 2022. Additionally, the company renegotiated the terms of about €45 million in trade financing and extended the deal until April 2022.

DIVERSIFIED

* Glencore Plc and Qatar Investment Authority have jointly spent about US$11.5 billion to grab a 19.5% stake in Russia's state-run oil giant Rosneft, Reuters and Sputnik reported.

* X2 Resources, a fund set up by mining veteran Mick Davis to snap up assets during the commodities downturn, has spent over £11 million on pay, rent and other costs over the past two years, but has yet to secure any deal, The Australian reported.

BASE METALS

* Vedanta Resources Plc unit Hindustan Zinc Ltd. received environment clearance to increase the lead-zinc production capacity at its Rajasthan, India-based facility to 4.5 million tonnes per annum from 2 Mtpa, India Today reported, citing a senior government official. The company will also increase ore beneficiation capacity to 5 Mtpa from 2 Mtpa at its Sindesar Khurd underground mine, also in Rajasthan.

* Union workers at BHP Billiton Group's Minera Escondida Ltda., which operates the Escondida copper mine in Chile, are requesting a bonus of 25 million Chilean pesos for the period from 2017 to 2019 as part of the collective agreement negotiations that began Dec. 27, daily Diario Financiero reported.

* Peruvian President Pedro Pablo Kuczynski said the government will aim to boosting pending mining projects, including Anglo American Plc's Quellaveco, Southern Copper Corp.'s Tia Maria and Galeano, as part of ongoing efforts to increase investment in the country, news agency Andina reported.

* Copper miner Compañía Minera Doña Inés de Collahuasi SCM reached an agreement with 27 employees who were laid off due to an illegal strike, resulting in the payment of 928 million Chilean pesos in compensations and legal costs, daily Pulso reported.

* PJSC MMC Norilsk Nickel signed a deal to buy copper concentrate from Rostec Corp., with an estimated volume of 1.5 million tonnes, containing base and precious metals. The transaction is valued at about 67.5 billion Russian rubles.

* A federal judge in Argentina's San Juan province filed charges against the chairman of Antofagasta Plc's Minera Los Pelambres, Francisco Veloso, over alleged illegal mining tailings deposited at Glencore Plc's El Pachon copper mine in the province, daily Tiempo de San Juan reported.

* China's Chihong Zn & Ge will close two zinc smelters, each with an annual capacity of less than 30,000 tonnes, as the company plans to upgrade another small smelter to a capacity of 50,000 tonnes per year, Metal Bulletin reported.

PRECIOUS METALS

* Rostec Corp. CEO Sergei Chemezov said the Russian state-owned group will consider selling a 25% stake in the Sukhoi Log joint venture to partner PJSC Polyus, Reuters reported.

* Yamana Gold Inc. closed its offering of purchase rights and related transactions connected to taking its Brio Gold Inc. spinoff public. The company transferred 17,324,507 common Brio Gold shares priced at C$3.25 apiece for aggregate proceeds of C$56.3 million.

* Southern Gold Ltd. and Westgold Resources Ltd. each received A$2 million as part of the first profit share distribution from the Cannon gold mine. Southern Gold applied A$1.5 million of the distribution to the repayment of the working capital facility provided by Westgold.

* Thai Prime Minister Prayut Chan-o-cha urged Kingsgate Consolidated Ltd. not to sue the government over the closure of the company's Chatree gold mine, noting that the move was just a suspension, The Nation reported.

* Separately, Kingsgate said the final payment against the Akara loan facility of US$6.3 million was made Dec. 23, and the Chatree mine is now debt free. Additionally, the company received the final payment of A$4.1 million from Silver Mines Ltd., which completes the sale of the remaining 15% of the Bowdens silver project in New South Wales to Silver Mines.

* Sumatra Copper & Gold Plc's lenders and major shareholders agreed to amend a US$45 million senior secured debt facility to improve the group's financial position. In addition, the company amended its gold hedging arrangements to delay 50% of the cash value on the six monthly deliveries from Oct. 31, to be repaid by mid-2017 without interest.

* Kuczynski proposed dredging Peru's biggest reservoir and a key source of water for drinking and farming in the northern Piura region to extract "much more gold" than what the country's biggest gold mine holds. Kuczynski said the reservoir could hold 1 gram of gold per cubic meter in 580 million cubic meters of sediment.

* Manas Resources Ltd. completed the sale of all of its mineral assets in the Kyrgyz Republic to Chinese state-owned Guizhou Geological and Mineral Resources Development Co. Ltd. and Kyrgyz firm NewGeo Technology LLC. The sale included the Shambesai gold project and Savoyardy gold assets.

BULK COMMODITIES

* India's mines ministry is considering a 5% increase in basic customs duty on the import of primary aluminum products to help take the pressure off local producers, including Vedanta Ltd., National Aluminium Co. Ltd. and Hindalco Industries Ltd., Live Mint reported.

* Avenira Ltd. expects to reach full nameplate production at its Gadde Bissik Operations Sarl mine plant in the first quarter next year. The subsidiary holds the company's Baobab phosphate project in Senegal, which has produced about 20,000 tonnes of phosphate product that is now on the drying pads.

* Bellzone Mining Plc secured up to US$4 million of working capital funding for 2017 from its 61.93% shareholder Hudson Global Ltd. The company's 2016 capital requirements were funded by a US$6.5 million loan due for repayment in March 2018.

* Orbite Technologies Inc. filed a preliminary prospectus in Canada to raise up to C$60 million over the next 25 months.

* The Fair Work Commission ruled that sick leave taken by 81 South32 Ltd. workers at the Appin coal mine from Nov. 28 to Dec. 11 was part of a coordinated illegal industrial action, The Australian Financial Review reported.

* Aluminum Corp. of China returned to full production at its unit Shanxi Huaxing Aluminum Co., Ltd.'s alumina plant after a pulp leakage, Metal Bulletin reported, citing a company spokesman. The leakage, caused by an equipment failure at the Shanxi Huaxing refinery, resulted in a loss of 940 tonnes of alumina production.

* South32 Ltd. secured approval for two more 305-meter-wide longwalls at its Dendrobium coal mine, part of the Illawarra operation in New South Wales, extracting coal from underneath the Metropolitan Special Area created to protect the waters of the Avon, Cataract, Cordeaux and Nepean reservoirs, The Sydney Morning Herald reported. The miner noted that the approval, which was made despite incomplete studies, would secure up to 400 jobs.

* The Korea International Trade Association said North Korea's coal exports to China jumped 112.1% on a yearly basis in November to US$139.4 million, The Korea Herald reported. This was observed ahead of the U.N. Security Council's resolution Nov. 30 to curb North Korean mineral exports, the organization added.

* Industrial and Commercial Bank of China signed three debt-for-equity swaps with Shanxi province's highly indebted state-owned coal and steel firms, Taiyuan Iron and Steel (Group) Co. Ltd., Datong Coal Mine Group Co. Ltd. and Yangquan Coal Industry (Group), to cut their corporate leverage, Reuters reported.

* Tata Steel Ltd. signed a definitive agreement to acquire for 9 billion Indian rupees Brahmani River Pellets Ltd. from Aryan Mining and Trading Corp. Pvt. Ltd. and other owners within the Moorgate Industries Group.

* A worker at the government-owned Singareni Collieries Co.'s Prakasam Khani opencast project-II in the Indian town of Manuguru was killed in an incident involving two vehicles, The Hindu reported.

* The European Commission started a probe into allegations of the dumping of grey iron and ductile cast iron by India and China into the EU, The Hindu reported. A complaint was launched by seven EU-based producers in late October, saying that the dumping was harming local industry.

* To balance the domestic steel market, Iran may cut import duties on flat steel by half, to 10%, on the back of insufficient supplies in the country as well as to support recovering downstream industries, Metal Bulletin reported, citing Deputy Minister of Industries Jafar Sarqeyni.

* Thailand's Iron and Steel Industry Club expects the country's iron and steel industry to grow 10% in 2017, with about 17.5 million tonnes of iron and steel products being used, Thailand's Manager Daily reported.

* CCX Carvão da Colômbia SA will liquidate its remaining assets in Colombia as commercial output is not viable and attempting to off-load these assets would be impractical, Business News Americas reported.

* The Vorkuta City Court in Russia suspended operations at all the mines owned by OAO Severstal's coal mining unit, AO Vorkutaugol, for 90 days starting Dec. 26, due to alleged violations in the equipment of lock chambers, Kommersant reported. The decision was made at the request of mine safety agency Rostekhnadzor.

SPECIALTY

* Électricité de France, or EdF, requested additional security from Paladin Energy Ltd. against a US$200 million prepayment under the long-term uranium off-take contract between the companies. EdF already has existing security over 60.1% of Paladin's Michelin uranium project in Canada under the August 2012 agreement.

* Enirgi Group Corp. confirmed US$300 million in investments to build a lithium project in the Rincón salt flat in Argentina's Salta province. Meanwhile, Italian investors reportedly approached the government of Jujuy province to develop the Jama, Salinas Grandes and Guayatoyoc salt flats, daily Inversor Energético reported.

* Sociedad de Inversiones Oro Blanco SA filed an official complaint against Chilean securities regulator SVS over the leak of sensitive information to potential investors during the failed sale period of its stake of Sociedad de Inversiones Pampa Calichera SA, which, in turn, holds a 23% stake in Sociedad Quimica y Minera de Chile SA, daily Diario Financiero reported.

INDUSTRY NEWS

* The ASX has been the most active this year for mining IPOs compared to the other major exchanges globally, largely due to a lift in market sentiment but also the sector's preference for the Australian bourse. There have been eight successful IPOs and listings on the ASX this year, compared to two in 2015, according to SNL Metals & Mining data.

* According to Chilean Corp. of Capital Goods data, mining investment projects for the period from 2016 to 2020 could total US$13.06 billion, the lowest since 2008, and representing 22% of the total investment expected nationwide. Codelco would account for 52% of the investment in the sector, daily El Mercurio reported.

* Salary expectations of top first and second level executives in the mining sector have declined. On average, they are willing to change jobs for a 5% raise, according to a study by consultancy firm DNA Human Capital, daily Pulso reported.

SNL Metals & Mining is an offering of S&P Global Market Intelligence.

The Daily Dose is updated as of 7 a.m. ET, and scans news sources published in Chinese, English, Indonesian, Malay, Portuguese, Russian, Spanish, Thai and Ukrainian. Some external links may require a subscription.