NLMK predicts 2% increase in steel demand in 2015

Novolipetsk Steel, which became the largest steel producer in Russia last year, expects global metal demand to expand this year as growth slows in China.

In 2014, the production of the company's rolled metal segment increased by 21.1 percent to 2.7 tons, due to an increase in the capacity utilization factor of the steelmaking potential of the NLMK Kaluga plant, which amounted to 1.0 million tons (x 2.7 year-on-year). Against the backdrop of increased production capacity, the segment's sales increased by 25.4 percent to 2.6 million tonnes, including 0.9 million tonnes at NLMK Kaluga (x 3 per year).

Oleg Bagrin, CEO of NLMK, said the company expects global steel demand to increase by 1.5-2 percent in 2015, but growth rates will differ across regions. The company believes that growth will be strong in the European, US and Japanese markets, while Chinese sales may continue to slow. The demand for metallization in St. Petersburg and other regions of the Russian Federation may also grow. At the same time, NLMK foresees the continued level of consumption of steel products by the main Russian customers in the construction, infrastructure and energy sectors this year.

Bagrin said that "While steel prices have declined by about 20 percent in the past year, everything will continue to depend on raw material costs. The likelihood of further declines in iron ore and coal prices is quite low. domestic prices back to one line with exports after weakening of the ruble. "