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8 May, 2009 15:09

Evraz confident on debt reschedulling

Evraz confident on debt reschedulling

Indebted Russian metals companies facing falling demand have been forced to look at different ways of refinance existing loans.

Steel company Evraz, which borrowed heavily from VneshEconombank, is positive about its ability to refinance its existing loans. RT spoke to the company's Senior Vice President, Pavel Tatianin, about the process and the outlook for steel prices.

PT: “We’re working on various options right now, and we’re reviewing various options on how we can refinance it, or extend it, or reschedule it. It’s premature to mention any immediate steps that we will take to refinance or reengineer or reschedule those, but we are definitely working on the situation. We are in talks with various banks and we have approached the banks the key lending banks in the end of last year, and since October 1 last year we were able to reschedule about $650 million of short term debt into longer term lines, that mature predominantly in 2010.”

RT: And what factors can push the price up?

PT: “It’s the end of de-stocking. Globally de-stocking is ongoing. Its almost complete for the longs, and probably almost complete for the semi-finished. Flats and plates and tubular products still need to go through a de-stocking phase, that’s factor 1. Factor 2 is the Government stimulus that would support global demand for steel. Clearly private demand for steel will not be enough to prompt for a quick recovery in the global steel markets. Number 3 is the finalization of the iron ore and coating discussions. If iron ore and coal prices stay close to where they were contracted at in 2008, if there is no sharp decline in the iron ore and coal prices in 2009 and 2010, then we believe that globally the majority of the steelmakers will be poised to push the prices up because otherwise they would be making operating losses.”