Russian steel output continues to increase

Russian steelmakers produced 4.96 million tonnes of non-alloy semi-finished steel in February, up by 5.3% on-year, according to national statistical service Rosstat data monitored by Kallanish.

In January, output is estimated to have reached 5.33mt, more than 7.5% on-year (see Kallanish passim).

January’s finished steel output was up by 2.1% on-year at 1.56mt. However, pipe production decreased 9.8% to 840,000t.

In 2020, Russian crude steel production reached 73.4mt, up 2.6% over 2019 (see Kallanish passim).

Fitch Ratings forecasts Russian demand in 2021 to increase by 4-6% on-year. This comes amid growth in construction volumes thanks to government support, the implementation of infrastructure investment projects, and the gradual recovery of the automotive industry.

The agency believes the negative effect of the new wave of Covid-19 will be much more moderate versus last spring, as the Russian government aims to avoid another lockdown.

ING bank says that “reduced global demand for oil, which has led to Russia’s OPEC+ commitments and is resulting in an ongoing circa 10% on-year drop in oil output” is a risk factor that could further hamper any industrial recovery in Russia.

“The metals sector is showing uneven performance in recent months, suggesting high dependence on the volatile global mood,” ING adds.

Svetoslav Abrossimov Bulgaria