UPGRADES INCREASE COMPETITIVENESS FOR MAGNITOGORSK
By Gordon Platt
Magnitogorsk Iron and Steel Works (MMK), one of Russia’s top steel producers, is upgrading its production facilities to improve its competitiveness in the global steel market and replace imports in the domestic market.
Russian president Dmitry Medvedev chaired a session of the presidential commission for modernization and technological development of the economy at the company’s headquarters in Magnitogorsk on the Ural River earlier this year.
MMK is targeting Russian and international customers with its rolled-steel products certification program. Its steel products sales to Russian automakers nearly doubled in 2010—to 406,000 metric tons.
MMK is also seeking certification by major manufacturers of home appliances. The company produces a range of steel products, including pipes, with an emphasis on higher value added.
In October 2010, MMK and Turkish metallurgy group, Atakas, commissioned a cold-rolling facility as part of a $1.7 billion joint venture in Turkey. MMK is seeking to buy out its partner’s stake, which will have an annual capacity of 2.3 million tons of hot-rolled flat sheets.
MMK won an auction in June 2011 for the right to extract iron ore for 25 years at the Kulmyakovsky deposit in the Chelyabinsk region of Russia. MMK says this will help to move the company closer to meeting its strategic goal of self-sufficiency in raw materials.
MMK reported revenue of $2.2 bil in the first quarter of 2011, an increase of 34% over first quarter 2010. Its earnings rose by 43% to $134 million.
The company’s global depositary receipts are traded on the London Stock Exchange.
