Russia’s Mechel posts lower production and sales figures for 2019

Friday, 20 March 2020 15:33:41 (GMT+3)   |   Istanbul

Mechel, one of the leading Russian mining and steel groups, has announced its operational results for 2019.  

In 2019, the company’s crude steel output decreased by seven percent year on year to 3.61 million mt, while its pig iron output dropped by eight percent to 3.326 million mt. This was caused by a large-scale upgrade of the blast furnace and oxygen converter workshops at its Chelyabinsk Metallurgical Plant. Meanwhile, the production of run-of-mine coal totaled 18.845 million mt, remaining unchanged. “In 2019, we invested a lot of effort in order to maintain coal mining at the previous levels as our stripping volumes increased dramatically. We did this both by launching new mining equipment and by bringing in third-party contractors”, Oleg Korzhov, Mechel’s CEO, stated, commenting on the results.

In 2019, Mechel’s coking coal concentrate sales remained at the previous year’s level of 7.163 million mt, SteelOrbis has learned. The key destinations for supply were Japan and China, with 29 percent and 27 percent shares of the total sales value, respectively. Meanwhile, Russia accounted for 24 percent of the total volume. The company’s thermal coal sales totaled 5.181 million mt in 2019, remaining roughly at the level of 2018. According to sources, during the given year the Asian market was the key market for supply, as it was considered to be the most profitable.

In 2019, the company’s total sales of long steel products decreased by eight percent year on year to 2.509 million mt, while its sales of flat steel products  totaled 449,000 mt, decreasing by seven percent year on year.

During the given year, Mechel’s ferrosilicon sales decreased by 10 percent year on year to 67,000 mt, amid maintenance of the ore-thermal furnace No. 3 at Bratsk Ferroalloys Plant. Taking into account that maintenance works at Bratsk Ferroalloys Plant and at Chelyabinsk Metallurgical Plant took place at the same time, the shipments of ferroalloys to third parties remained untapped, as needed volumes were redirected from the domestic market to the traditional export market, i.e., Asia.

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