More than 10,000 sanctions have been imposed against Russia, and it is already clear that steelmakers are losing sales markets, says the Russian Steel Association.

“Applications from domestic consumers are also declining,” it noted after the Metallurgical Summit "Russian Steel: Growth Strategy" in Tula. “According to the speakers, under such conditions it is necessary to make adjustments to the tax system for the steel industry, because the excise tax on liquid steel is questionable.”

Earlier, the association warned that Russian steelmakers are already suffering losses and reducing production. Russian Steel noted that, due to sanctions, supplies have to be redirected from the US and EU markets to China and other Asian countries, where Russian goods are sold at a discount, and in some cases even below cost.

It said the share of Asia in export deliveries already exceeds 50%, against 10-20% before the start of the Russian-Ukrainian war.

After that, The Russian Federal Antimonopoly Service (FAS) issued a warning to Russian Steel Association, in connection with the publication of his forecast for reduced production (see Kallanish passim).

Russian industry minister Denis Mantrurov previously indicated he expects a decrease in demand for steel in the domestic market in 2022, but it will be only by a single-digit percentage.

Manturov does not agree with the forecast of the World Steel Association, which expects a decrease in demand for steel in Russia by 20% this year to 35.1 million tonnes, from 43.9mt in 2021.

This week, Russian President Vladimir Putin acknowledged that Russia’s ferrous industry is signalling the risk of a significant decline in production in the medium term (see Kallanish passim).

Earlier, MMK said it expects to reduce steel output by 40% this month to 550,000 tonnes. Severstal also confirms it could experience a drop in output by 20-40% in June.