Russian MMK cuts production, investments and jobs amid crisis in local steel industry

Magnitogorsk Iron and Steel Works, one of the key representatives of the metallurgical industry and the largest producer of rolled products in Russia, recently announced a significant reduction in production volumes, as well as the layoff of workers. The general crisis in the Russian metallurgical sector deepened in 2025 with a rather poor forecast for 2026. The main factor is the decline in the consumption of steel products in the country against the background of high interest rates combined with difficult exports due to pressure from sanctions.

According to the company's statement, MMK's capacity utilization rate has dropped to 60 percent, compared with 70-80 percent in 2025. In particular, the group will be idle at facilities that are not in use due to the limited number of orders. "They have stopped the blast furnace, converter and a bunch of other equipment located downstream and upstream, so they are not so dependent on the volume of orders," a source in the local market told SteelOrbis.

In addition to reducing production volumes, PJSC MMK also announced the implementation of a cost reduction program. "We are optimizing inventory and have significantly reduced equipment repairs. We have practically stopped our investment program and have retained only those projects that affect production efficiency and environmental policy. A difficult decision has been made to suspend unused facilities, which has affected almost all of the group's assets, " MMK said in a statement. In addition, Magnitogorsk Iron and Steel Works has decided to reduce the number of employees.