Magnitogorsk Metal & Steel Works - MMK- is to increase production by 18.7 percent this month and by as much as 42 percent in February after a revival in demand, Interfax reported on Monday, citing company chairman Viktor Rashnikov.
"Metals traders have run out of their stocks," Rashnikov said at an industry meeting in Chelyabinsk on Saturday.
MMK produced 421,000 tons of steel in December, working at half production capacity as demand faded and metals prices plummeted last year.
The company has been unprofitable for the last three months, Rashnikov said, adding that he expected it would break even in March.
Rashnikov gave details to previously announced cuts to MMK's investment program. "We will decrease the program from the planned 40 billion roubles to 15 billion roubles," he said.
Russia's biggest metals, pipe and machine producers have asked the government to assist debt-ridden state-run companies, Rashnikov said.
"Our main debtors are companies with direct or indirect state participation," Rashnikov said, adding that if Gazprom paid the 10 billion roubles it owed pipe producers, "the whole production chain would be in good order."
The Chelyabinsk meeting also called on the Russian government to guarantee their obligations to banks, freeze tariffs on rail transportation and increase state orders, Interfax reported.
Source: Moscow Times
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