Insufficient Governmental Support of Domestic Producers Worries Russia's Metallurgists

'Insufficient Governmental Support of Domestic Producers Worries Russia's Metallurgists.' Such was the comment that came, early in 2003, from Dmitry Gorshkov, Sales Director of the Severstal steel company. According to Seversal's press service quoting Mr. Gorshkov, because railroad tariffs were hiked early in January, the company's transportation costs jumped up by nearly USD 500,000. The costs of exporting steel to Eastern Europe is now twice that of selling it to Southeast Asia. Mr. Gorshkov further said, 'One should remember that goods sold to Eastern Europe carry a lot of added value. The loss of this market will hit hard both Metallurgists and the state treasury'.

The administration of Severstal believes that the situation around zinc plated rolled metal imports into Russia is also strained. Mr. Gorshkov said the government was not doing much about limiting such exports from certain countries, including Ukraine. This is why the administrations of the Cherepovets, Novolipetsk, and Magnitogorsk metalworks will have to put in to the government to toughen controls over zinc plated rolled metal imports.

The Severstal steel company of the city of Cherepovets, the Vologda Region, is a large domestic producer of steel, the principal production facility of the Severstal-Group holding. Its statutory capital amounts to USD 172,454. In 2002, the company increased its output by 5.6% year-on-year to 8,534,500 tonnes. The Severstal-Group holding also owns the Severstal-Auto, Reverstal-Resource, Severstal-Trans, UAZ, The Zaporozhiye Motor Plant, Karelsky Okatysh, Olenegorsk Ore-dressing Plant and other companies.

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