Russian metallurgical industry development status

Metallurgical industry is the basic sector
of Russian industry. In 2011, the Russian metallurgical industry employment was
nearly 1.3 million, 80% of enterprises are belonged to urban construction
fields. Look from the production, metallurgical industry (ferrous and
nonferrous) output in Russia’s GDP accounted for 9%, exports accounted for
11.6%, industrial sector accounted for 5% of employees, taxes accounted for 5%
of the budget.

From an international comparative
perspective, the Russian steel output ranked fifth in the world, (only behind to
China, Japan, the U.S. and India), iron ore production is also fifth in the world,
steel pipe production is third in the world. Exports of metallurgical products
is second in the world (only behind to China and Japan), aluminum production is
second in the world, titanium production is second too, aluminum exports is first,
nickel production and exports are first in the world.

Industrial Structure

Russian metallurgical industry includes
black, non-ferrous minerals and non-metallic mineral mining; Iron, steel,
rolled, steel, iron alloy, refractory materials, coke, aluminum, copper, rare
metals; ferrous metals, alloy production and processing of semiconductors;
Scrap, scrap metal processing and certain related chemical products. In
addition, the metallurgical industry contains a large supplementary
enterprises, scientific research and design organizations.

Metallurgical industrial enterprises for
nearly eight years achieves vertical integration, reducing the industry’s
competitive risks in the domestic market, improved investment policies to
ensure the safety of their raw materials industries. In recent years,
metallurgical industrial enterprises actively carry out services in the field
of metal processing and metallurgical manufactures.

overall commentary of industry development of the metallurgical industry

In 2004, the Russian finished steel
production was 53.7 million tons, 29.8 million tons of domestic consumption;
2011, finished steel production increased by 10% (59 million tons), domestic
consumption grew by 25.8% (37.5 million tons); steel production increased by
60% (9.6 million tons), domestic consumption grew by 78 percent (10.9 million

Russia’s domestic non-ferrous metal
products are mainly provided by the Chinese. 2011, the domestic demand for
aluminum reached 875,000 tons, compared with 2004 growth of 148.6%. Domestic
demand for refined copper in 2011 reached 300,000 tons, an increase of 107%
compared to 2004.

The Russian government’s anti-crisis
measures in preventing the decline in production capacity of metallurgical
enterprises have played a very good effect, which ensure the number of jobs, and
enable investment projects to be continued before crisis. In recent years, the
metallurgical industry upgrading of fixed assets become one of the main factors
of the industry to successfully overcome the financial crisis, also make
high-tech products with high added value production has been enhanced.

Over the past decade, metallurgical
industry used for the upgrading, transformation and expansion of production
investments totaled more than 1.6 trillion rubles. Currently, Russian
metallurgical enterprises large equipment of wear rate does not exceed 50%,
which makes the industry more flexibility to respond to negative changes in the
external market environment.

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