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First-quarter sales flat for Severstal's Russia-made rolled steel

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Sales of steel products manufactured domestically by Severstal, Russia’s second-largest steelmaker, were almost flat in the first quarter of 2012 compared with the last three months of 2011, the company said on Friday April 27.

Total sales increased by 2% to 2.63 million tonnes in the first quarter, from 2.58 million tonnes. The rise was due to higher sales of semi-finished products.

In rolled products, sales from the main production site in the Russian city of Cherepovets stood at 1.85 million tonnes in the first quarter.

“Total Russia-made rolled product sales were flat quarter-on-quarter, while the rise in hot rolled strip and plate was counter-balanced by the lower sales of cold rolled coil and long products,” Renaissance Capital analyst Boris Krasnojenov said.

Sales of hot rolled strip and plate rose by 14% to 1.22 million tonnes in the first quarter, from 1.08 million tonnes in the fourth quarter.

Cold rolled sheet sales were down by 21% at 284,574 tonnes from 359,082 tonnes in the same comparison, while long products sales were down by 29% at 132,989 tonnes from 187,194 tonnes.

A Severstal spokesman said the falls were due to seasonally lower demand.

In semi-finished products, a rise in the slab sales was due to higher demand in the Russian and Indian markets, Severstal said, but it does not expect any significant further rise in the slab sales in the near term.

The company expects second-quarter 2012 slab sales to be on the level of the previous three months.

The overall rise in Severstal’s sales was in line with the dynamics seen at rival steelmaker Magnitogorsk Iron & Steel (MMK), which saw sales of its Russia-made products rise by 5% quarter-on-quarter in the first three months of the year.

The average selling price of Severstal’s hot rolled strip and plate from Cherepovets fell by 9% to $652 per tonne ex-works in the first quarter, from $719 per tonne in the fourth quarter.

The average price of Cherepovets’ cold rolled sheet dipped by 8% to $751 per tonne ex-works in the first three months, down from $815 previously.

Company-wide total crude steel output by Severstal, which makes most of its steel in Russia but also has two facilities in the USA, stood at 3.99 million tonnes in the first quarter, a 6% rise from 3.76 million tonnes in the fourth quarter of 2011.

Within this, however, first-quarter output at Cherepovets was down by 3% quarter-on-quarter at 2.71 million tonnes, from 2.79 million tonnes.

Severstal’s total steel products output, including semi-finished goods, stood at 3.76 million tonnes in the first quarter, up 5% from 3.59 million tonnes in the fourth quarter.

Output at Cherepovets edged up by 2% in the first quarter to 2.63 million tonnes, from 2.58 million tonnes in the last three months of 2011.

Nadia Popova 
npopova@metalbulletin.com

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