UPDATE2: Russia must take steps to keep volumes of metals exports

(Adds details in paragraphs 3-5)

PERM, Mar 30 (PRIME) -- Russia must take steps to keep volumes of metals exports and to increase metals supplies on the domestic market, Prime Minister Dmitry Medvedev said at an industry meeting on Wednesday.

“Maintaining volumes of exports amid such conditions is a very difficult, but important task, which, of course, must be solved in the industry, and ways to expand supplies of metal products on the domestic market and their use in all economic branches must be also considered,” Medvedev said.

Russian producers of ferrous and non-ferrous metals are facing serious problems, which worsened in 2015 amid low metals prices, he said, adding that Russian metals production may fall in 2016.

The Industry and Trade Ministry is looking for possibilities to increase local consumption of metals with a high added value, and sees the possibility for expansion of consumption of light steel thin-wall structures in the construction industry and of rolled stock with zinc and polymer coating, Minister Denis Manturov said.

“Together with other federal authorities, we are to submit a separate program to the government soon to create productions in aluminum processing. Similar work is being done in all main segments of ferrous, non-ferrous, and special metallurgy and we expect cooperation from all colleagues in our search of promising technological niches and new growth points,” he said.

The ministry sees possibilities for the domestic car, household appliances, heavy machinery and power industries to increase consumption of rolled stock with zinc and polymer coating, and the ministry is improving regulatory standards for that. Results of the ministry’s integrated work will be reflected in an updated strategy for the sector’s development until 2030, and the changes are to be made until the end of 2016, Manturov added.

The Russian government expects production of ferrous and non-ferrous metals to fall in 2016 due to contraction of internal demand and protectionist measures of foreign countries, as seen by PRIME in the government’s materials prepared for a meeting on the sectors’ development.

Low prices for metals at world markets also had a negative impact, as prices for main ferrous metals fell by up to 40% on the year in December 2015 and prices for aluminum fell by up to 22%, for copper by up to 28%, and for nickel by up to 45%, according to the documents.

Russian metals industry is still export-oriented, and despite a gradual increase of domestic supplies, exports still account for up to 45% of annual supplies of rolled steel and for 63–99% of supplies of non-ferrous metals.

End