Mechel keeps Q3 coal output flat at 7 mln tonnes
MOSCOW. Nov 7 (Interfax) - Mechel produced around 7 million tonnes of coal in Q3 2013, level with Q2, the company said in a press release.
Coal production edged down 1.7% year-on-year in January-September to 20.43 million tonnes.
Coking coal concentrate sales fell 10% quarter-on-quarter to 2.6 million tonnes in Q3 2013 and 8% in 9M to 8.35 million tonnes.
"The 10% decrease in the coking coal sales quarter-on-quarter was due to weaker domestic demand, which was partly compensated by increased export volumes. Sales were also affected by the shipping delays to Asia due to Far Eastern floods. Mechel Bluestone retained coking coal sales on the second-quarter level," said Mechel CEO Yevgeny Mikhel.
Mechel operating highlights ('000 tonnes):
| Q3 2013 | Q2 2013 | % | 9M 2013 | 9M 2012 | % | |
| Output | ||||||
| Run-of-mine coal | 7 028 | 6 997 | 0 | 20 430 | 20 794 | -1,7% |
| Pig iron | 913 | 1 023 | -11% | 2 908 | 3 107 | -6% |
| Crude steel | 1 098 | 1 249 | -12% | 3 684 | 5 101 | -28% |
| Sales | ||||||
| Coking coal concentrate | 2 615 | 2 891 | -10% | 8 349 | 9 029 | -8% |
| Anthracites | 472 | 589 | -20% | 1 603 | 1 937 | -17% |
| PCI | 1 124 | 626 | 79% | 2 567 | 1 703 | 51% |
| Steam coal | 1 508 | 1 441 | 5% | 4 499 | 4 490 | 0 |
| Iron ore concentrate | 1 097 | 947 | 16% | 3 083 | 3 219 | -4% |
| Coke | 729 | 765 | -5% | 2 291 | 2 707 | -15% |
| Ferrosilicon | 24 | 25,1 | -5% | 72 | 57 | 26% |
| Long products | 936 | 970 | -3% | 2 747 | 3 107 | -12% |
| Flat products | 159 | 124 | 28% | 468 | 534 | -12% |
| Billets | 91 | 205 | -56% | 651 | 1 950 | -67% |
| Hardware | 227 | 222 | 2% | 653 | 737 | -11% |
"In accordance with our long-term strategy, Mechel continues to expand into new markets for metallurgical coals. Over this year's first nine months the company managed to increase its PCI sales by 51% compared to the same period last year due to increased supplies to Asia Pacific, Britain and Belgium. Anthracite sales in the third quarter went down as our European customers partly replaced anthracites for PCI," Mechel said.
"Iron ore product sales in the third quarter went up by 26% due to increased demand in China and a simultaneous increase in domestic sales," it said.
"Steel sales volumes decreased over these nine months as compared to the same period last year due to our disposal of Romanian steelmaking assets and halting of Donetsk Electrometallurgical Plant due to unprofitability. The decrease in pig iron and steel production quarter-on-quarter was caused by major repairs to Chelyabinsk Metallurgical Plant's blast furnace #1 and converter #3, as well as the decrease in electrical steelmaking due to unfavorable market conditions.
Demand on the construction steel rolls market, which is key for Mechel, remained stable in the third quarter, which enabled us to keep the long rolls sales stable and high. The increase of flat rolls sales by 28% is due to sales of stores which were part of pre-sale preparation works at several Mechel Service Global facilities. Billet sales went down by 56% in the third quarter as sales of third-party products decreased due to the end of our strategic partnership with Estar Group's enterprises.
In April the Uvatsk quartzite deposit began supplying Bratsk Ferroalloy Plant with ore. The launch of a modernized furnace #4 at Bratsk Ferroalloy Plant enabled us to increase production and sales of ferrosilicon by 26% compared to the nine months of 2012.
The Group's power division enterprises ensured electricity and heat production in the third quarter as planned. Sales of electricity and heat showed a decrease due to a seasonal slump. The decrease in heat and electricity sales in 9M2013 as compared to the same period last year is due to disposal of several power division assets - primarily Toplofikatsia Rousse EAD," Mechel said.