Mechel, one of the leading Russian mining and steel groups, has issued its
production data for 2008.
Accordingly, during the given period the company saw a 24 percent increase in its coal
production to 26.393 million mt (including a 45 percent increase in its
coking coal production to 15.148 million mt and a 12 percent rise in its coal concentrate output to 13.847 million mt), but a six percent decrease in its nickel
production to 16,000 mt, a five percent drop in its
iron ore concentrate
production to 4.7 million metric tons and a 14 percent decrease in its coke
production to 3.326 million mt, all compared with the last year data.
Accordingly,
Mechel's coke output in 2008 was affected by the scheduled major repairs at Chelyabinsk Metallurgical Plant coking battery No. 6, and the idling of the Moscow Coke and Gas Plant coking battery.
In its steel segment, in 2008
Mechel saw a five percent decrease in its
pig iron production, a three percent drop in its crude steel
production and a two percent decrease in its finished steel products output (including a nine percent decrease in
flats output, a two percent increase in
longs output, and a seven percent drop in
semis production) year on year. The respective figures in mt were 3.5 million, 5.9 million, and 5.392 million (including 357,000 of
flats, 3.348 million of
longs and 1.687 million of
semis).
The decrease in demand for
Mechel's products, caused by the global crisis, has forced the company to reduce its output of
semis products, offsetting the increase in long products output, thus in line with the company's strategy to increase the
production of high-margin downstream products. Meanwhile, the drop in
pig iron output resulted from the shutdown of Chelyabinsk Metallurgical Plant's blast furnace No. 4 due to scheduled repair works.
In 2008,
Mechel implemented several projects included in its investment plan, such as major repairs with upgrades, installation of new equipment and processes, and development of corporate sales and
distribution chains. The acquisition of Ductil Steel in
Romania allowed
Mechel to enhance its presence in the steel market in Eastern
Europe.
Commenting on the 2008 operational results,
Mechel's senior vice-president Vladimir Polin stated that the company's subsidiaries showed overall stable operational results in 2008 despite negative trends in the economy at the end of the year. "We are constantly monitoring the markets, revising our operations program and performing all necessary activities for equipment maintenance so as to be able to increase output with the greatest efficiently as soon as the markets recover," added Mr. Polin.