MMK increases its domestic shipments to over 9 mln tonnes

2019-03-13

Mar. 13, 2019 - Magnitogorsk Iron and Steel Works’ (MMK) shipments of commercial metal products to the domestic market, including CIS countries, amounted to 9.029 mln tonnes in 2018. This represents an almost 6% increase from the previous year.

This constitutes the second largest shipment volume to the domestic market since 2014, when the shipments of metal products amounted to 9.588 mln tonnes. 79% of the Company's total sales are to the domestic market.

On a regional scale and given its geographical location, the Urals region is particularly significant for MMK with 36% share of its total sales. 18% of total sales were shipped to the Volga region, while the Central region and CIS countries accounted for 15% of shipments.

MMK's largest industrial consumer within the Russian market is the pipe industry, to which 2 mln tonnes of metal products were delivered. Around 880,000 tonnes of metal products were delivered to metalware and non-integrated plants and 636,000 tonnes directly to construction companies and to manufacturers of building materials and metal structures. The automotive industry is also among MMK’s largest consumers in Russia (535,000 tonnes). A significant portion of deliveries are made to the spot market - in 2018, 2.5 mln tonnes of metal products were shipped to metal trading companies and service metal centres.

In the early 2000s, the plant's management decided to pursue a strategy to guarantee that MKK was meeting the demands of the domestic market. This included moving the enterprise to a location in the immediate vicinity of regions with the highest demand for its products. In recent years, MMK's largest investment projects have also been focused on meeting the demands of the domestic market. Among them were the creation of a modern section rolling factory, of facilities for the production of coated metal, the construction of the largest industrial complexes for the manufacturing of thick plate and cold-rolled galvanised steel designed for the automotive industry. All these projects are import-substituting and intended to initiate the manufacturing of products previously not produced in Russia. Today, all these modern production facilities are under high consumer demand and make a significant contribution to MMK's financial results as they focus on high value-added (HVA) products.

About MMK 

MMK is one of the world's largest steel producers and a leading Russian metals company. The company's operations in Russia include a large steel-producing unit encompassing the entire production chain, from the preparation of iron ore to downstream processing of rolled steel. MMK turns out a broad range of steel products with a predominant share of high-value-added products. In 2018, the company produced 12.7 mln tonnes of crude steel and 11.7 mln tonnes of commercial steel products. MMK Group had sales in 2018 of USD 8,214 mln and EBITDA of USD 2,418 mln.