Russian pig iron supplies will collapse due to sanctions

At the same time, in the last month supplies continue to fall, although the government agreed to abolish the exchange rate export duty on pig iron and certain types of rolled products from October, as insisted by the Ministry of Industry and Trade. The ministry believed that such a measure would increase the profitability of exports and maintain production volumes.

The main reason for the continuing decline is the EU and US sanctions related to the hostilities in Ukraine. Europe has limited supplies through quotas, while Washington imposed barrier duties back in March last year.

The industry is seriously pressured by the growth of logistics costs and its limited capacity, this concerns both railroads, especially in the eastern direction, and ports. In addition, pig iron output had to be reduced due to a decrease in domestic consumption and exports of steel. Separately, export dynamics was affected by low export prices.