Russian steelmaker Magnitogorsk Iron and Steel (MMK) expects continuously strong demand for steel products in the domestic market in the third quarter to keep sales strong. The completion of another stage of hot rolling mill-2500 upgrade will have a positive impact on sales volumes, supporting the group's financial indications in Q3, the company says in a note sent to Kallanish.
Russia’s domestic market, where the mill sold around 90% of output in the second quarter, continues to provide a high price premium. Exports of finished steel products in Q2 fell -1.5% on-quarter to 286,000 tonnes, while first-half-year exports plunged -47.2% on-year to 575,000t, MMK says. Total sales of finished products in Q2 rose 2.7% on-quarter to 2.86mt, but H1 sales notched down -1% to 5.64mt.
The company continued to ramp up higher-value-added (HVA) product sales in Q2, raising them 6.6% on-quarter to 1.43mt, with a 50% share in total sales. In H1 they grew 1.4% on-year to 2.76mt, with a 49% share. Production and sales of cold rolled coil subsequently declined, as the steelmaker produced more coated and galvanised products. It produced 241,000t of CRC in Q2, down -6.2% on-quarter, and 498,000t in H1, down -19% on-year.
The company produced 2.73 million tonnes of finished products in Q2, flat on-quarter, but H1 output notched down -2.3% to 5.46mt. The latter was partially affected by a -6.1% on-year decline in hot-rolled products output on the back of the ongoing upgrade of mill-2500.
Crude steel output remained roughly unchanged at 3.1mt in Q2 and 6.2mt in H1, but pig iron output increased by 2.3% on-quarter in Q2 to 2.45mt and 3.6% in H1 to 4.85mt. This followed the completion of blast furnace No.7 overhaul at the principal Magnitogorsk works, allowing the company to cut the share of ferrous scrap in its feedstock mix.