Severstal’s hot metal output fell -3% on-quarter in the second quarter to 2.3 million tonnes due to maintenance at blast furnaces nos.1, 4 and 5. However, crude steel production was flat at 3.06mt, reflecting electric arc furnace-based output growth, Kallanish learns from the Russian steelmaker.

Consolidated steel sales were unchanged at 2.84mt, but the share of domestic shipments rose 5 percentage points to 70% due to the increased attractiveness of domestic sales. High-value-added products’ share in sales rose 2pp to 46%, reflecting a decline in sales of semi-finished and hot rolled coil, and higher sales of galvanised, colour-coated and large diameter pipes (LDPs).

Semis recorded the steepest fall in Q2 sales of -43% on-quarter to 69,000t, with HRC down -6% to 1.04mt, while the fastest growth was in colour-coated sales, at 38% to 141,000t. Long product sales grew 13% to 420,000t.

LDP sales volumes grew 9%, which reflects the realisation of accumulated stock of LDP for the Poland-Slovakia Gas Interconnection project (Eustream) produced in 2018 and shipped in the previous quarter, Severstal observes. In February Izhora Pipe Mill (IPM) won several tenders to supply Gazprom with over 200,000t of LDP.

Iron ore pellet sales rose 2% in Q2 to 2.9mt due to seasonal factors and despite a decline in output.

In the first half of 2019 crude steel and hot metal output thus grew 1% on-year each to 6.1mt and 4.67mt respectively.

Semis sales fell -57% in H1 to 190,000t and cold rolled coil was down -27% to 517,000t. However, HRC sales rose 11% to 2.14mt, galvanized coil sales grew 18% to 491,000t and colour-coated sales were up 41% to 243,000t. Iron ore pellet sales fell -14% to 3.2mt.