In the cradle of the industrial revolution


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I am grateful to Maria at American Metal Market , for sending me a link to an article that appeared in the Pittsburgh Post Gazette, written by David Bear. If you ever get to the UK David, I would gladly be your guide to Ironbridge for the day.

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IRONBRIDGE GORGE, Shropshire, England — It may be common to believe that Pittsburgh, with the steel mills that sprang up along the Monongahela and Allegheny rivers at the end of the 19th century, was the birthplace of the modern metals industry.

But that distinction belongs to this placid, tree-draped, 4-mile-long valley along the upper reaches of the Severn River, 100 miles upstream from Bristol.

It was here that Abraham Darby, an enterprising, God-fearing Quaker, arrived in 1708 to set up an operation for casting iron cooking pots. In those days, most metal cookware was made from brass and was very costly. Darby, then 31, had apprenticed at a foundry in Bristol where he’d worked out and patented a method to cast pots out of iron, which was cheaper than brass.

But Darby’s inventiveness didn’t end there. He also devised a way to smelt iron with coked coal, which was abundant in the hills of western England, rather than using charcoal, which required stripping the land of lumber.

Before long, Darby’s new iron furnace was producing the unimaginable quantity of six tons of iron per week, and his company began mass casting a range of cooking pots at high quality and low cost. The age of industry was under way.

Unfortunately, the pollution generated by his industry sickened Darby, who died in 1717 at age 39. But his family continued the operation, and the Coalbrookdale iron works grew and pioneered innovative techniques for making and casting the versatile metal, ideas that were quickly applied elsewhere.

By the 1770s, the once pastoral river valley had become an industrial dynamo, with much of its machinery cast from local iron. There were more furnaces and forges along the gorge’s two miles than anywhere else in the world, and the iron that flowed from them enabled the expansion of the British Empire. Smaller factories making clay tiles and smoking pipes had taken root along one bank, while fine ceramic china was being manufactured on the other.

The ravages of industrial pollution were becoming a problem as troublesome as the floods that periodically roared through the narrow valley.

In 1775 a local draftsman, T. F. Pritchard, approached Darby’s grandson, Abraham III, with an audacious plan to erect a bridge of cast iron to span the capricious Severn. His design called for a graceful, 60-foot-high arch of iron members to span 100 feet between two masonry abutments. No iron structure had ever been attempted on that scale. Some 800 structural members, the largest of which weighed 4 tons and measured 70 feet long, were cast in open sand forms constructed right on the building site.

The bridge’s construction took most of two years and required 380 tons of iron, all of it smelted in nearby furnaces. No one really knew what would happen when everything was bolted together and hoisted into position. The project’s extra costs nearly bankrupted Darby’s grandson, who had agreed to pay all overages.

But the design was true, and from the moment the iron toll bridge across the Severn opened on New Year’s Day 1781, it became an immediate, international sensation, a tourist attraction drawing admiring visitors from around the world. Artists, writers, engineers, spies, royalty and peasants all came to marvel at that “most incomparable piece of architecture.”

Other iron bridges were built along the river, but Darby’s delight had captured an enduring place in history. And the bridge itself has endured for nearly 230 years. Vehicular traffic used it to cross the river until 1934, and tolls were still collected for pedestrians until 1950 when ownership of the bridge was turned over to the county council, which began developing the bridge and other industrial facilities as historical attractions.

In 1986, the entire Ironbridge Gorge was declared a World Heritage Site, a place of outstanding cultural or natural importance to the common heritage of humanity. In addition to the bridge and its adjacent toll house museum, the gorge features a clutch of other engaging small museums, each packed with artifacts from the area’s industrial age.

Among these are the Coalbrookdale Museum of Iron, three floors of exhibits housed in Darby’s former iron works, with a detailed history of the company and its products, including the brick works for the original blast furnace. Another building contains Enginuity, a modern, hands-on museum chronicling all the ways that good ideas are transformed into reality. Nearby, the two sturdy stone houses erected by Abraham I and his successors, have been carefully restored and filled with generations of family history and Quaker memorabilia.

Situated in an old brick warehouse down on the river’s bank, the Museum of the Gorge serves to catalog and explain the history and ecology of the gorge.

On the valley’s upper slopes, Blists Hill Victorian Town re-creates the coal mining village that took root along the Shropshire Canal above the gorge. In its collection of authentic shops, homes and a working forge costumed interpreters bring the past to life.

On the river’s opposite bank is the Jackfield Tile Museum. By the time the Iron Bridge was erected, utilitarian tile had been made from local clays for more than a century. By 1800, decorative tiles were being cast, and in Victorian times came in vogue for adorning everything from subway stations to pubs.

All in all, Ironbridge Gorge makes for a fascinating foray into the early evolution of the industrial age, and a full day is not enough time to explore all of its various elements.


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EU-FLAT PRODUCTS STEEL PRICES CONTINUE TO CLIMB IN JUNE


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The relentless upward movement in EU prices continues. Customers are obliged to accept the new higher third quarter values demanded by local producers. Prices of imported strip into Europe are still increasing this month, although less material is entering the region. There is relatively little steel from China due to the pending anti-dumping investigations. Output from domestic mills for July/September deliveries appears to be restricted.

Demand from end-users in Germany has slowed slightly because they are not sure they can pass on their increased costs to their customers in a weakening economic climate. Although service centres are making good profits at present, they are keeping stocks down. Third country imports are available, albeit not always at attractive prices. Buyers are not keen to place orders for deliveries so far ahead, when they feel current prices are probably at their peak for this cycle.

In the French market, inventories are quite low and not expected to recover in the near term because of a lack of overseas availability and restricted supply from domestic sources. Prices continue to increase for third quarter deliveries. Sales are only average, although demand from the auto sector has improved.

Strip mill prices have registered further sizeable rises in Italy this month and the trend is expected to continue to the end of the summer as import volumes drop away. As hot rolled coil prices escalate, they are pushing the rest of the flat products with them. Stocks are depleted at present because customers are reluctant to risk losing money if the price trend goes into reverse.

Corus, of the UK, has stated that it will lift basis prices for quarterly contracts in mainland Europe by €130 per tonne from July 1. So far, no official announcements have been issued concerning the local market. Sales at home are lacklustre. However, customers have fewer options on supply because of a lack of third country imports and much smaller quantities than usual on offer from other EU suppliers. There has been no speculative purchasing ahead of the period three price advances. Negotiations are underway and it is clear that prices will rise markedly. Our tabled figures are the results of early deals and values could go higher as more business is concluded.

Steel consumption is still quite good in Belgium, although the domestic appliance sector is starting to show signs of weakness. Market players are concerned that the second half of the year could prove to be more difficult as prices may have almost reached a level that the market can no longer support. Stocks at the service centres are on the low side of normal due to tight credit, delayed deliveries and mill restrictions on supply. Distributors are able to pass the higher mill prices to their customers. End-users are keeping inventories to a minimum. Third country material is absent and the European mills are reported to be selling large tonnages overseas.

In Spain, general demand is stable. However, the auto sector is still reducing order volumes and construction activity is particularly weak as ongoing projects are completed and new ones postponed or cancelled. Availability from European mills is constrained, with smaller clients suffering the most.


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Stocks in news: Future Cap, Ranbaxy, HPCL


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Stocks in news:

Results today:
EIH Associated Hotels, FCS Software, Future Capital Holdings, Ind-Swift Laboratories, JHS Svendgaard, Rajshree Sugars and Ratnamani Metals
Board meets:
Ratnamani Metals, Shri Dinesh Mills on stock split
Ex Dividend: Dabur (75%) and UCO Bank (10%)
Ranbaxy
Reaches settlement with Pfizer on Lipitor litigation
Ranbaxy, Pfizer also agree to settle Caduet & Quinapril cases
Ranbaxy, Pfizer agree to withdraw all litigations against each other
No upfront payments from Pfizer; all revenues only through sales
Ranbaxy likely to get over $1.5 bn in sales due to settlement: Srcs
Agreement to allow Ranbaxy 180-day exclusivity for Caduet, Lipitor in US
FM Says open To Capital Infusion In Banks Like SBI
New listing:
Niraj Cement Structurals; issue price Rs 190/sh
Steel:
Primary steel producers may raise prices in the first week of August: Sources
Prices of flat products may be raised by Rs 5000-7000 per tonne: Sources
Prices of long products may be raised by Rs 3000 per tonne: Sources
3 month moratorium on price hike expires on first week of August
Shyam group, Spanco Tele in JV to acquire Punj Lloyd’s ISP division, to invest Rs 500 cr in 2 years to expand network
P&G to reduce managerial staff in bid to counter rising input costs - ET
Tata’s bail out Indian Hotels rights issue, subscribe over 80% of the issue investing Rs 480 cr - ET
ADAG mulls bid for Spilberg’s Dream Works, deal likely worth $600m
RIL controlled SeaKing Infra may bag sea-link project
Tata Steel, Essar eyes JV with Indonesian Co Kartatau Steel to build 2.5mt plans - BS
BHEL outbids Alstom to bag EPC contract for Tripura project - FE
ZEE may list 2 divisions ZEE Motion Pic and ZEE Limelight on LSE’s AIM - FE
HPCL may buy 2 Bengal units, in talks with Coal India - TOI
2.4 cr United Breweries shares to hit the market
Plethico says report of co to buy US co for $100 m 揾as been wrongly reported?
Allcargo Global board meet on June 26 to consider stock split
Jet on Rs 100 cr JetLite tax notice news:
Service tax probe pertains to Sahara Airlines for period prior to Sahara acquisition; tax liability on then promoters
MTNL gets international long distance licence
Rel Comm Says
Exploring Criminal Proceedings Against RIL Officials
May Initiate Proceedings Against LV Merchant, Sandeep Tandon
RIL - Response to Rel Comm
No Criminality Attached To Signing Of Jan 12, 2006 Agreement
Will Defend Ourselves In Case Of Any Criminal Proceedings


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The Daily Resource 06/20/2008


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Precious Metals

Gold was slightly lower until the open of the New York session on Thursday, but went vertical at that point, adding $20 in an hour and peaking at $908 before easing during the rest of the NYMEX and dropping further in the Globex to fall back below $900 and finish at $898.00/oz., up only $4.40. Overnight, gold is trending higher.

Platinum pushed past $2090 in Hong Kong, but that was its high for the day, as it sold off whenever a rally began and ended near its intraday low at $2041/oz., down $42. Overnight, platinum has edged higher.

Silver followed gold’s chart almost exactly, peaking around the same time at $17.72, then declining to close at $17.32/oz., down a penny. Overnight, silver has been pushing higher.

Although they ended up with not much to show for it, it was a pretty good day for the precious metals, considering that the equities markets turned around, the price of crude plummeted, and the dollar edged slightly higher.

Gold battled the headwinds blowing against it because, “In the medium to long term, the combination of strong international safe-haven demand and decreasing production and supply of gold in most major producers, and particularly in South Africa, will likely result in gold going significantly higher in the coming months,” said Mark O’Byrne, of Gold and Silver Investments Ltd.

The production falloff in South Africa is precipitous, O’Byrne said. “South African gold output in April fell more than 10% in volume terms, compared with a year earlier … [Further,] South African production of gold was over 1,000 tonnes per annum in 1970 and has been steadily declining to nearly 250 tonnes per annum today.”

Output “has fallen sharply after state-owned power utility Eskom struggled to provide sufficient power to mines,” O’Byrne said. And, “Eskom have admitted that the power and electricity problems are a major challenge and may take years to rectify, which would likely result in further falls in gold production in South Africa.”

Peter Spina, of GoldSeek.com, believes gold is a tightly coiling spring. With oil “now solidly above $100, gold should easily be above the four-figures mark,” Spina said. “The longer the oil price stays above the $100 level, the more appealing gold will become and the investment buying will support the gold price during this traditionally weak seasonal period.”

Overall, “Pressures are building within the gold and silver complex, this may be another pop higher followed by consolidation, but I expect one of these rallies to gain traction and ignite the next leg higher in the gold price,” Spina wrote. “It could be well underway by summer’s end.”

Currencies and Economic News

In the currency market, the dollar edged higher against the euro. Late Thursday, the euro was trading at $1.5503 vs. $1.5525 on Wednesday.

The buck garnered some support after the Labor Department said applications for first-time jobless benefits dropped to a two-week low of 381,000 for the week ended June 14.

However, that drop was tempered by a two-month high in the four-week average of initial claims. That number, which tends to smooth out one-time anomalies, ticked upwards, to 375,250, last week.

The average is at a new cycle high, noted Ian Shepherdson of High Frequency Economics. “This is recession territory, at least if the experience of 2001 is a guide,” Shepherdson wrote.

In early March 2001 — the first month of the last recession — the eight-week average of claims was just 362,000, lower than it is now, and it rose rapidly thereafter. “The pace of layoffs is now quite high, with no prospect of any reversal or even a leveling-off in the near future,” wrote Shepherdson.

The number of persons continuing to collect unemployment benefits fell back to 3.06 million in the week ended June 7, a drop of 76,000. Although it’s at the lowest level since April, it still far exceeds the year-ago mark of 2.52 million.

Energy

In the energy market Thursday, crude for July delivery plummeted, closing at $131.93/barrel, down $4.75. July reformulated gasoline plunged 11.4 cents, to $3.3526/gallon.

Market participants shrugged off supply threat news from Nigeria. Royal Dutch Shell reported that it had shut in production at its main offshore oil field after an attack by boat by local militants. The Shell platform produces 200,000 barrels a day.

Instead traders focused on a decision by China’s National Development and Reform Commission to raise gasoline, diesel and jet-fuel prices by 17, 18 and 25%, respectively.

“This follows the trend of other Asian countries reducing government fuel subsidies, which should, over time, put a dent in demand,” said analysts at Action Economics.

However, Sean Brodrick, a natural resources analyst for MoneyandMarkets.com, wrote that “oil bears and stock bulls alike are seizing on this news from China like drowning men grasping at lifelines … [but] I hope they can live with disappointment.”

Upping China’s gasoline and diesel prices by 46 cents a gallon, is “probably not enough to have much impact on existing demand,” Brodrick said.

Base Metals

The base metals were mixed on Thursday. Copper sank during the pre-dawn hours but took off during the first hour of New York trading, before easing later in the day and finishing at $3.8466/lb., up 2 1/4 cents. Nickel prolonged Wednesday’s slide, briefly falling below $10 before recovering to close at $10.0259/lb., down 39 2/3 cents. Zinc was off during the pre-dawn hours and never recovered much, ending at $0.8586/lb., down 2 1/4 cents. Aluminum was down for most of the day, but edged back to wind up essentially unchanged at $1.3794/lb., while lead sagged through the whole day, eventually shedding 3 1/4 cents, to $0.8051/lb.

Copper held up, on a mostly down day for the industrial metals, due to the labor unrest in Peru. A strike at Southern Copper’s Cuajone mine in Moquegua province has severely curtailed output, while the company’s Ilo smelter will have to close soon if supplies can’t get through roadblocks in the area. Strikes and protests have also broken out at other mines in Peru.

In addition, Norddeutsche Affinerie, Europe’s largest copper producer, said that China may have recently responded to high prices by selling part of its strategic copper stocks. That would account for diminished Chinese import demand for the metal in recent months.

Meanwhile, nickel oversupply grew in April to the widest in eight months as demand receded for the third month in a row, according to the International Nickel Study Group.

Supply exceeded demand by 13,700 metric tons in April, the INSG report said. Production increased 6.1%, year over year, while consumption was 112,800 tons, off 0.9% from March.

Zinc struggled as stockpiles of the metal jumped to a 21-month high. Inventories monitored by the LME rose 5.8% yesterday, to 152,175 tons, the highest level since September 20, 2006.

Zinc production outpaced demand by 64,000 tons in the first four months of this year, the World Bureau of Metal Statistics said.

Lower zinc prices have led to production cutbacks at smelters in China, according to researcher CBI China Co. The average operating capacity of the country’s 28 largest zinc smelters dropped from 83 to 78% in May year over year, CBI China said.


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