Evraz cold increase share of HVA output, lessen exposure to iron ore, coal suppliers in Russia
MOSCOW. July 4 (Interfax) - Evraz is thinking of increasing the share of high value-added output at its own production sites, CFO Nikolai Ivanov told Interfax in an Interview.
"We have the opportunity to sustain present levels of pig iron and crude steel production but produce more in the way of high value-added goods and semis, which we export. Yes, this is a good market and we are not having any problems given our costs and demand for products. But we could be producing new, value-added goods," Ivanov said, adding that he was talking not just about the group's Russian sites.
He also said Evraz was not yet self-sufficient in iron ore feedstock, while its strategic model envisaged a totally vertically integrated production chain. "The results of the past two years show that this [raw material self-sufficiency] is probably the right way: ore prices have soared as have coal prices, but we can control those costs better if we are self-sufficient," Ivanov said.
The group's Urals division has all the raw materials it needs, while ZSMK in Siberia has less than 60%. "Our aim is to get our sites in Russia fully self-sufficient. For this we have to ramp up iron ore production, and we're probably looking at further investment in EvrazRuda," Ivanov said.
"As regards coal, we produce far more of that than we need, so we sell some of it on the Russian market and some of it abroad. But there are still certain grades that we need to buy on the market and just as with iron ore, we would like to be fully self-sufficient in the necessary grades of coal," he said.