25 Apr 2018 09:25

NLMK sees global demand for flat steel products growing 4.7% in 2018

MOSCOW. April 25 (Interfax) - Global demand for flat steel products will grow by 4.7% in 2018 and by an average of 1.8% annually in the period from 2018 to 2022, NLMK Group forecast in its quarterly report.

"High rates of growth of macroeconomic indicators are expected to continue in 2018: global GDP will grow by 2.9% and industrial production by 4.4%. In light of this, 2018 could become the peak year for consumption dynamics," the Russian steelmaker said.

The company expects a "seasonal upturn of construction activity in the northern hemisphere" in the second quarter of 2018, and forecasts that global demand for flat products could increase by 3.5% compared to the first quarter of 2018, while demand for flat products on the domestic market could grow by 10%12% quarter-on-quarter.

NLMK expects the upward trend in prices to continue in the second quarter. Due to modest purchases by traders in March, coil inventories at the start of the second quarter do not exceed demand, moderating competition, the company said. End demand will begin to grow in April, pushing traders to increase purchases on the primary market. Another positive factor will be growth in the share of Russian flat product exports with support from export prices, the company expects.

NLMK, which has production facilities in Russia, Europe and the United States, has capacity to produce 17 million tonnes of molten steel per year, including about 16 million tonnes in Russia. The company's principal shareholder is Vladmir Lisin, who owns 84% of NLMK through Fletcher Group Holdings. The free float is 16%. Depositary Receipts on the company's shares (10 receipts representing one share) are traded on the London Stock Exchange.