Industry and Trade Ministry: steel demand in Russia to grow by 9-10 mln tonnes on pipes for new oil and gas pipelines

TASHKENT. April 26 (Interfax) - Additional demand for metallurgical products and large diameter pipes in particular due to the construction of oil and gas pipelines could alone amount to 9-10 million tonnes, which is comparable with the current consumption of all pipe products in Russia. Another 0.8-1 million tonnes in demand could be generated by intensification of construction, Deputy Minister of Industry and Trade of the Russian Federation Viktor Yevtukhov told reporters on the sidelines of Innoprom forum.

"If construction continues at the same pace and additional sites are built (because we are now building bridges, overpasses, federal highways), then up to 800,000 to 1 million tons per year," he said in response to a question regarding how much higher domestic demand for steel products could be.

"If the solutions discussed for the oil and gas sector are implemented and new strings of oil and gas pipelines are built, the increase in consumption will be much higher there," he added.

The volume of domestic consumption of finished steel in Russia currently is 41.3 million tonnes per year, he said, while the volume of consumption of tubular products stands at about 10 million tonnes.

"If new strings of oil and gas pipelines are built, the volume of domestic consumption only for large-diameter pipes will increase by 9-10 million tonnes per year," the deputy minister said, estimating the prospects of growth in demand.

At a meeting on April 20, Russian President Vladimir Putin called for boosting demand for steel products on the domestic market, mainly via growth of construction volumes. "I would like to emphasize the importance of domestic demand. It should be supported and stimulated, primarily by increasing the volume of housing, infrastructure, commercial and industrial construction, at the expense of wide production of goods for which steel products are needed," he said.

"We now want to increase the use of steel structures in construction, this was discussed at a meeting of the president with steelmakers, and, accordingly, the development of new state standards, improvement of fire safety rules (not in terms of their simplification and departure from them, but in terms of these rules objectively correlated with what materials are now used)," Yevtukhov said.

At the same time, the task of reorienting export flows is still relevant. "We are not planning to consume metal only in the domestic market. If some foreign markets are closed, we will help our colleagues to reorient to other markets," the deputy minister said.