NLMK stops supplying slabs to the USA

NLMK stopped supplying Russian-made slabs to its US subsidiaries in February after securing supplies from other countries that were exempted from US steel tariffs. So said the chairman of the NLMK Strategy Committee Oleg Bagrin during the presentation of the new five-year strategy of the steel company in London on Monday.

According to CEO Grigory Fedorishin, the company is still looking for a legitimate route to obtain a US tariff exemption and will return to discuss further strategy at its next AGM in April.

According to Bagrin, hot-rolled slabs in the US are now $ 250-300 per tonne: "... a premium that is not available anywhere else in the world, a duty over $ 100 per tonne is the price you pay for access to the market." ... “While the scenario is still profitable, it is volatile, increases volatility and hinders planning ahead. One project - reheating the reheating furnace at the Penzilvania plants - is now on hold after 25% of the capital expenditure has already been spent. part of US $ 300-400 million of investments in US facilities of NLMK, which were suspended.

Price swings are expected to return to more regular levels as more companies gain access to the US market through duty breaks and US domestic production rises. NLMK may consider the issue of a partial exit, but therefore "... it makes no sense to completely exit the US market."

Slab production has already declined due to the start of large-scale upgrades of blast furnace and base oxygen furnaces at its flagship Lipetsk plant as the company embarks on its second major five-year development plan, Strategy 2022.