According to the Ministry of Industry and Trade of the Russian Federation (Minpromtorg RF), the Russian steel sector in 2010 grew by about 10% in comparison with 2009. Output has only just reached 2005 levels of production after the crisis. Crude steel production in 2010 grew from 59.4 mt to 66.5 mt. Finished steel output grew from 50.8mt in 2009 to 55 mt (8.3% growth) and steel tube and pipe from 6.7mt to 8.2 mt (23% growth). [Final figures will be confirmed by Rosstat in April, 2011].
By producer, crude steel output and rolled products production in 2010 was as follows: NLMK, Lipetsk: 11.5 mt (+8.8%) and rolled products 11.6 mt (+9.9%); Mechel: 6.07 mt (+11%) of crude steel and 6.17 mt (+16%) of rolled products; Evraz: 16.3 mt (+6.6%) and 14.7 mt (+2.7%), respectively.
Total metallurgical goods transportation by the Russian railways in 2010 grew significantly. Shipments of iron ore involved movement of 101.9 mt (+6.8%), of ferrous metals of 87.9 mt (+12.4%), ferrous scrap 20.9 mt (+26.5). In 2010 Russian export of ferrous metals amounted to ~30 mt (106.8% of the 2009 level) and Russia will thus remain the world number three exporter in 2010 after China and Japan. Russian export of steel pipes in 2010 was just 1.1 mt (69% of the 2009 level, only).
Year 2010 apparent steel demand in Russia was 30.3 mt, or 120.3% of 2009 demand. Steel demand in Russia has been led by strong activity in the pipe and tube sector due realization of some large projects by Gazprom and Transneft. Production in the automotive industry recovered post-crisis thanks to the implementation of a ‘cash-for-clunkers’ programme. Domestic consumption of steel pipes in 2010 was about 8.5 mt, or 150% of the 2009 level - from which the LDP share was 3.0 mt. Total Russian steel tube and pipe production capacity reached about 13.5 mt in 2010.
The accumulated depreciation of Russian metallurgical equipment now exceeds about 43%. In 2009-2010, State guarantees in the metallurgical sector involved credits for a total sum of Rbl 53.4 bln. Total 2010 investments in the Russian steel sector reached about Rbl 160 bln. Notable modernisation projects in 2010 involved:
Readers will be interested to note that both the above production shops were put into operation by Russian Prime Minister himself.
Minpromtorg RF was heavily involved in actualization of most priority investments projects for the Russian metallurgical complex in 2010. The total sum of these investment projects [priority projects] in ferrous metallurgy in the next 5 years is around Rbl 370 bln. In 2011, these main investments will include:
Under the latest forecast of the Ministry of Industry and Trade of the Russian Federation, 2011 production volumes in iron and steel metallurgy will increase on the average by 4-6%. The projections assume finished steel rolled product output of ~57.5 mt, steel pipe output of 8.8 mt (on 7.3% more). Domestic consumption of the finished steel rolled products in 2011 is expected at ~32.7 mt (7.9% growth in demand); and demand of steel pipes at 8.5 mt (zero growth in demand). The import share in domestic consumption in 2011 will be ~9.8% for rolled steel products and ~11.2% for steel pipe, according to Ministry projections.
The main drivers of steel demand will include the APEC Vladivostok Summit in 2012, the Student Games in Kazan in 2013 and the Olympic Games in Sochi in 2014. Preparations for the world football championship in 2018 will underpin subsequent demand: FIFA 2018 in Russia is estimated to require some 3 mt steel products for stadium construction alone.
|01-Nov-10||Russian freight transport sector - Nov 2010 review|
|01-Sep-10||Russian tube and pipe sector - Sep 2010 review|
|01-Jul-10||Labour force dynamics|
|01-May-10||CIS steel markets|
|01-Mar-10||Russian Metallurgy Review End 2009|
|01-Jan-10||Ukrainian Metallurgy Review End 2009|
|01-Dec-09||Automotive recycling in Russia|
|01-Nov-09||Oligarch involvement - CIS metallurgy|
|01-Oct-09||Russian steel - coming out of the crisis|
|01-Aug-09||Steel in Byelorussia|
|01-Jul-09||Steel modernisation projects in Russia|
|01-Jun-09||Kazakhstan steel industry review|
|01-Apr-09||Russian steel crisis - raw materials|
|01-Mar-09||Ukraine steelmaking raw materials|
|01-Feb-09||2008 year end review|
|01-Jan-09||Impact of the credit crisis|
|01-Oct-08||Stainless steel sector in Russia|
|01-Sep-08||2007 Russian steel industry review|
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