MMK investing in future production
Business RT spoke with MMK Chairman and President, Victor Rashnikov, about the $250 million strategic move.
VR: “Our Company has been operating here for the past ten years. There’s a great demand for hot-rolled metal. We used to supply not less than a million tons of it, while the deficit between the supply and demand in 2006-2007 amounted to four or five million. I’ve reached an agreement with a port that will allow us to export our product to Europe and the Middle East if we are unable to sell all our rolled metals here. Basically, we wanted to export it to Turkey. But the crisis has changed our plans. We may export to the Balkans, Italy, Tunisia, the Arab countries and the Persian Gulf where huge construction projects are under way and where zinc-plated polymers are needed. Syria and Iran are also very close.”
RT: MMK also owns iron ore fields, but during the financial downturn the development of these fields was postponed. So, what are your plans now?
VR: “We have an investment program. This year we’ve opened the Sosnovskoye mine, we are now enriching ore there. So, we have an opportunity to increase iron ore production to 50%. Plus, we’ve bought the Baikal mine and are extracting some ore from there. Today, we meet 30% of the overall demand in raw materials, and in the next three or four years we are planning to meet the internal demand for iron ore by 50%.”
RT: When, do you think, you can return to pre crisis production levels?
VR: “We are planning to produce ten million tons of rolled metal this year. We are going to increase the output by some 20% by 2011 and by another 20% the year after. Our aim is to restore the pre-crisis output. In 2007 we worked to full capacity and produced 12 million tons a year. This task can be solved.”