Business Monitor International


Russia Metals Report

Published 08 April 2014

  • 64 pages
  • Instant access to your report online and PDF format through your account library
  • Includes 3 free updated quarterly reports
 
$1,295.00
Russia Metals Report

The Russian metals sector will face headwinds over coming quarters as European and US demand remains weak and global oversupply weighs on metal prices. We expect production of key metals to remain modest, with company investment plans focusing on improving plant efficiency and reducing costs rather than building new plants or expanding production capacity. Despite weak growth, Russia will remain one of the world's largest producers of base and industrial metals including nickel, steel and aluminium.

Steel, Aluminium & Nickel Supply Glut To Weigh On Growth

We expect Russia's rank among global steel producers to come under threat, as the country's largest steel-makers experience squeezed margins resulting in production cuts. The global steel market will remain mired in significant overcapacity, sluggish demand and weak margins for the foreseeable future due to China's failure to reform its bloated steel sector.

Weak Growth Outlook
Russia - Crude Steel Production '000 tonnes & % Growth

Global aluminium oversupply will continue to precipitate weak aluminium prices. We expect prices to head modestly higher over our forecast period to 2018, but fail to return to their 2011 peaks. Aluminium prices averaged US$2,421/tonne in 2011, while we forecast prices to average US$2,000/tonne over the period 2014-2018. Russia's largest aluminium producer, Rusal, has demonstrated weak performance over the past financial year as a result of low prices.

We expect weak growth in Russian nickel production of just 1.0% y-o-y from 2014 to 2018, reaching 292.0kt in 2018. Global nickel inventories continue to rise, compounding what is an already oversupplied market. LME stockpiles reached 256kt in Q413, with no reversal of this trend in sight.

Oligopolies To Remain In Place

Russia's metals output is highly consolidated within each metal segment, as restrictive foreign ownership rights and established oligopolies prevent foreign competition. Within nickel production, Norilsk Nickel is the...

Table of Contents

BMI Industry View
7
SWOT
9
Metals SWOT
9
Industry Forecast
11
Steel: Global Oversupply To Weigh On Growth
11
Table: Russia - Steel Production ('000 tonnes, unless stated otherwise)
15
Table: Russia - Steel Production & Trade ('000 tonnes, unless stated otherwise)
15
Aluminium: Growth Outlook Hindered By Oversupply
16
Table: Russia - Primary Aluminium Production & Consumption ('000 tonnes, unless stated otherwise)
19
Nickel: Weak Prices To Hinder Output Growth
20
Table: Russia - Nickel Consumption & Production ('000 tonnes, unless stated otherwise)
23
Regulatory Development
24
Key Details
24
Table: Political Overview
26
Table: Europe: Mining Regulatory Outlook
27
Commodities Forecast
28
Commodity Strategy
28
Steel: Locked In Secular Downtrend
30
Aluminium: US$1,800
Aluminium: US$1,800
Copper: Bearish View In Place Despite Some Recovery
31
Nickel: Despite Recent Gains, Downside Risks Dominate
33
Zinc: Channelling Support
35
Table: Select Commodities - Performance & BMI forecasts
36
Table: BMI Commodities Strategy
37
Commodities Forecast
38
Table: BMI Steel Forecast
38
Table: Steel Data And Forecasts, 2009-2017
46
Competitive Landscape
47
Table: Russia - Largest Listed Metals Producers - Financial Data
48
Company Profile
50
Norilsk Nickel
50
Overview
51
Strategy
52
Table: Norilsk Nickel - Financial Metrics
54
RUSAL
55
Table: RUSAL - Key Financial Data
59
Severstal
60
Table: Severstal - Financial Data
63
Methodology
64
Cross Checks
64

The Russia Metals Report has been researched at source, and features latest-available data for steel, aluminium and other major globally-traded commodities. Our analysis covers all primary indicators, including production, exports and price, with our forecasts underpinned by Business Monitor International (BMI)'s macroeconomists global economic outlook. The report analyses trends and prospects and critically evaluates latest industry news, trends and regulatory developments in Russia.

BMI's Russia Metals Report provides industry professionals and strategists, sector analysts, business investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the metals industry in Russia.

Key Benefits

  • Benchmark BMI's independent metals industry forecasts for Russia to test other views - a key input for successful budgeting and strategic business planning in the Russia metals market.
  • Target business opportunities and risks in Russia through our reviews of latest industry trends, regulatory changes and major projects and investments.
  • Exploit the latest competitive intelligence and company profiles on your competitors and peers.

Coverage

Executive Summary

Summary of BMI's key forecasts and industry analysis, covering metals production and prices, plus analysis of landmark company developments and key changes in the regulatory environment.

SWOT Analysis

SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis of the state's metals sector, business environment, politics and economics, which carefully evaluates the short- and medium-term issues facing the industry.

Global Metals Market Overview

Global demand, supply and price forecasts for steel and aluminium, as well as gold, copper and tin, drawing on both our industry expertise and our macroeconomic and financial market team's long-term global demand forecasts and shorter-term market views.

Industry Forecasts

Historic data series and forecasts to end-2017 for all key industry indicators (see list below) supported by explicit assumptions, plus analysis of key downside risks to the main forecast.

Production (`000 tonnes, US$bn), consumption (`000 tonnes, US$bn), exports (`000 tonnes, US$bn); prices (US$/tonne), and growth (%).

Macroeconomic Forecasts

BMI forecasts to end-2017 for headline country macroeconomic indicators, including real GDP growth (%), GDP per capita (US$), population (mn), industrial production index (% y-o-y average) and unemployment (% of labour force).

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Testimonials

'An essential, multi-faceted research tool. BMI’s thorough understanding of the major market players enables an informed – and informative – review of the sector’s actual performance, together with useful insights into current industry issues, which are topped-off with detailed and invaluable forecasts of industry and macroeconomic trends.’

Senior Research Analyst, ABC International Bank plc