CIS: Russian companies post decline in steel sales in Q3CY'21

Russia's leading steel producers, MMK and NLMK, have reported a drop in their steel sales volume q-o-q in Q3CY'21 (Jul-Sept'21), according to the companies' releases.

MMK's steel sales down 17% q-o-q

Steel sales of MMK Group fell by 16.8% q-o-q to 2.76 million tonnes (mn t) in Q3CY'21 due to low domestic demand. However, the company's exports increased in Q3CY'21.

• Semi-finished steel (slabs and billets) sales decreased by 39.3% q-o-q to 45,000 tonnes (t).
  
  
• Sales of flat hot-rolled products amounted to 1.25 mn t, a 18.4% q-o-q drop. Finished long steel sales were recorded at 249,000 t in Q3CY'21.
  
  
• Sales of the company's premium products were down 12.9% to 1.21 mn t.
  
  

Crude steel output flat q-o-q: MMK Group's crude steel output remained largely stable q-o-q at 3.39 mn t in Q3CY'21, reflecting favourable market conditions and the launch of the electric arc furnace facility at the company's Turkish facility.

NLMK's steel sales down 4% q-o-q

NLMK Group's steel sales in Q3CY'21 were recorded at 4.1 mn t, a decrease of 4% q-o-q. Sales were down following a decrease in steel output at NLMK Lipetsk. The company's domestic steel sales totalled 2.8 mn t, flat q-o-q while exports grew by 2% q-o-q to 1.4 mn t.

• Sales of semi-finished products increased marginally by 1% q-o-q, mainly due to higher pig iron sales.
  
  
• Sales of finished products were also up by a marginal 1% q-o-q to 2.7 mn t amid stable demand in the key markets.
  
  

Crude steel output falls 15% q-o-q: NLMK Group reported a significant drop in its crude steel production in Q3CY'21. Steel output stood at 3.9 mn t, down 15% q-o-q. Production remained affected mainly due to the incident in its oxygen supply unit at the Lipetsk site in Aug'21 and the subsequent repair works.

Q4CY'21 outlook

The Russian steel market is currently sluggish due to high prices and weak demand. Most steel players are looking for export opportunities due to low domestic sales. MMK Group expects that these dull domestic steel sentiments, if sustained, could affect their sales in Q4CY'21. However, the company is confident, on the other hand, that the increase in steel output at its Turkish facility may support its overall sales.