Metallurgists increased production in May, but demand remains weak
According to the results of May, the Russian steel industry showed positive production dynamics in most segments in a monthly comparison. But the company does not yet see global positive signals in the market. Demand in the domestic market remains weak, and the export capabilities of metallurgists are limited by the strengthening of the ruble and the overproduction of steel on the world market.
Russian metallurgists increased the production of steel, cast iron and finished rental in May relative to April, according to the preliminary data of Corporation Chermet. So, the smelting of steel became 5.3%, up to 6 million tons for a month, the production of cast iron – by 4.8%, up to 4.5 million tons, finished rental – by 2%, up to 5.2 million tons. Pipe production remained at the April level of 1 million tons. But the production of steel, finished rental and pipes is still lower than May 2024. But the production of cast iron has grown by 3%by the year.
According to the results of five months of 2025, the annual comparison of the dynamics is also mostly negative. So, steel smelting was reduced by 5.2%for the period, to 29.1 million tons, the release of the finished rental – by 6.2%, to 25.1 million tons, pipes – by 9.2%, up to 4.7 million tons. A small increase shows the production of cast iron – by 0.3%, up to 21.7 million tons.
Dmitry Orekhov, managing director of the NCR rating agency, says that metal consumption in May from the construction industry has increased, although it is very inferior to indicators of a year ago in absolute values.
“This is due to the revived individual housing construction,” he explains. Ilya Makarov, director of the corporate ratings group, associates May indicators with an increase in demand for the products of the construction variety and from machine -builders. But, according to him, it is still difficult to say whether it is a long -term trend or only a seasonal revival.
Boris Krasnozhenov, Head of the Analysting Department for the Securities Market of Securities, notes that the visible demand for sheet rental in the domestic market remains weak, including high-added products-galvanized rental and polymer rental. According to him, a certain positive dynamics for smelting steel last month may be associated with the completion of repair work on the domain-convertible capacities. Large manufacturers could also offer customers certain discounts to increase the loading of capacities, the analyst adds.
Viktor Tarnavsky, head of the analytical department of the industry publication “Metal Substitution and Sales”, notes that there was no particular positive dynamics in May, given that last month there was one day more than in April. “There was a little hope that in May demand would increase. But she did not materialize. Therefore, in June, production will probably be reduced again, ”he said.
The market participants surveyed by Kommersant expect a further decline in the consumption of ferrous metallurgy products within the country this year.
According to Dmitry Orekhov, a decrease in mortgage lending and a reduction in the number of new projects will necessarily affect the state of the metallurgical industry in the whole year. “In the current situation, we expect a decrease in steel consumption in the Russian Federation this year by 5% of 2024 indicators,” he says. According to Boris Krasnozhenov, for a fundamental change in the situation, it is necessary to reduce the export of rental from China and a further decrease in the key rate to revive activity in metal -combat sectors.
Chief Economist of the Institute of Growth Economics named after P. A. Stolypin Boris Kopeikin indicates that the production of cast iron could support an increase in exports to Turkey since the beginning of the year, as well as active deliveries to the EU in the first months, until the quota is exhausted. But in general, according to him, a high level of price competition against the backdrop of the growth of excess capacities has become on the world market, and the dynamics of demand is extremely sluggish. “Given the strengthening of the ruble, the prospects for export building are not obvious,” the expert notes.
