Russia's metallurgical industry is showing a sharp decline in production by the end of 2024. The reasons are the loss of Western markets due to sanctions.
Points of attention
- The Russian metallurgical industry is facing a sharp decline in production due to the loss of Western markets due to sanctions.
- The largest enterprises, such as Magnitogorsk Metallurgical Plant and Norilsk Nickel, have experienced a noticeable decrease in steel and metal production.
- The real reasons for the decline in production are the loss of markets, falling prices and demand, as well as the impact of internal factors such as a high discount rate and the economic crisis.
- Sanctions and the war against Ukraine are having a devastating impact on key sectors of the Russian economy, leading to a projected further decline in industrial production.
- The consequences of sanctions are already being felt in other important industrial sectors, such as oil refining, which suffered due to a drone attack on the Ryazan Refinery.
Russia's metallurgical industry is experiencing a sharp decline
According to the Central Statistical Office, the largest metallurgical plant in Russia, Magnitogorsk Metallurgical Plant, has reduced steel production by 14% and pig iron by 4.5%.
At the same time, the leading producer of non-ferrous metals, Norilsk Nickel, reduced its nickel output by 6%, copper by 12%, and palladium by 10%. Russian steel exports fell by 22%, and steel pipes by 77%," the CPD statement said.
Officially, enterprises explain the decline by planned modernization, but the real reasons lie in the loss of Western markets due to sanctions, lower prices and demand in Asian markets, as well as a drop in domestic consumption due to the high discount rate and the general economic crisis.
Despite the statements of the Russian authorities and propaganda, the war against Ukraine and sanctions are dealing a devastating blow to key sectors of the Russian economy. The future forecasts for the Kremlin are bleak — industrial production will continue to fall, the CPD emphasized.
Ryazan Refinery Suspends Work
It is worth noting that this oil refinery is one of the four largest refineries in the aggressor country.
According to two industry sources, the drone attack on the refinery caused a fire in an oil storage facility. Among the damaged equipment was a railway loading ramp and a hydrotreating unit, which is used to remove impurities from refined petroleum products.
"The railway loading equipment was damaged. There was no loading on the railways, oil refining stopped," one of the sources told the publication.
Another source reported that loading had been suspended since Friday, January 24, and confirmed that the plant's operations had been halted due to the inability to ship petroleum products.
According to sources, other refineries, including in Moscow, Nizhny Novgorod and Yaroslavl, may intervene in fuel supplies.
