Page 24-25 - MMK annual report 2011

Basic HTML Version

/ 2011 /
Management
Social Sphere
Risks
Finances
Sales Markets
About Us
Information
ANNUAL REPORT
24
25
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008
2009
2010
2011
2007
0
250
200
150
100
50
222
154
150
190
60%
66%
56%
69%
67%
Domestic price premium, USD/t
Share of domestic sales, %
241
29%
18%
17%
15%
5%
9%
ММК
Severstal
ChMK
NTMK
Other
NLMK
ZSMK
7%
A key contributor to growing global steel production and consumption in the past decade was China. The
country’s production grew 8.9 % in 2011, reaching 696 million tonnes, and apparent consumption was up 7.5 %
to 643 million tonnes.
Steel Production in Russia and China
Steel production at MMK in 2011 grew by 3 % (to 11.7 million tonnes), at a rate on par with the average
for Russia.
Crude Steel Production at MMK
Finished Products Production at MMK
2011
11.7 miliion tonnes
+3 %
2011
10.6 million tonnes
+4 %
2010
11.4 million tonnes
2010
10.2 million tonnes
MMK has successfully increased its share of the Russian finished steel goods market for two years in a
row: from 17 % in 2009 to 17.7 % in 2010, and 17.9 % in 2011.
Structure of Russian Steel Production Market in 2011
In 2011 Russia increased crude steel production by 2.4 % to 68.4 million tonnes. Despite this growth,
India overtook Russia in 2011 as the #4 global steel producer, increasing steel production by 5.7 % to 72
million tonnes in 2011. The other top global producers are China (696 million tonnes), Japan (108 million
tonnes) and the USA (86 million tonnes).
Overview and Analysis of the Steel Market
According to the World Steel Association, global steel production reached 1.5 billion tonnes in 2011, an
increase of 6.8% over 2010. Apparent steel consumption grew by 6.5 %, reaching 1.4 billion tonnes in
2011.
Global Steel Production and Consumption
Russian and CIS Markets
In 2011 shipments to the domestic market (including the CIS) totalled 7.2 million tonnes, an increase of
2 %. The share of domestic shipments in MMK’s sales decreased by 2 %, from the highest-ever level of
67 % in 2010.
As high value added products prevail in domestic sales, the average price per tonne for steel products
on the domestic market has historically enjoyed a premium over average export prices. Average
domestic steel prices were USD 241/t higher than average export prices in 2011.
MMK's Share of Domestic Sales as a Function of Price Premium
2007
2008
2009
2010
2011
800
1 , 200
1 , 600
Steel consumption, m tonnes
Steel production, m tonnes
0
200
300
400
500
600
700
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
66
281
72
490
68
696
0
100
59
151
RUSSIA
CHINA
0
100
200
300
400
500
600
700