Latest news with #Severstal
Yahoo
4 days ago
- Business
- Yahoo
Russia's Steel Industry on the Brink? Severstal Warns of Potential Shutdowns
Steel demand in Russia is heading into rough terrainand Severstal (SVJTY) is waving a red flag. CEO Alexander Shevelev told Rossiya-24 that some production lines may need to shut down to balance oversupply as domestic consumption could drop 10% this year, down to 39 million tons. That's a steep declinecomparable to the full-year appetite of some entire industries. With steel prices sitting at multi-year lows and the strong ruble choking exports, many producers are now walking a fine line between breakeven and red ink. This isn't just a sector storyit's a window into the wider slowdown rippling through Russia's economy. Last year's rate hikes to tame inflation are still casting a long shadow. The Economy Ministry is now warning of recession risks, and exporters are getting squeezed by a ruble that's surged nearly 23% since 2023. At a current rate of 78.72 per dollar, the ruble is far from the 90100 range Shevelev believes would better support trade. That FX pressure is compounding pain for commodity sellers across oil, steel, and beyond. Despite the storm clouds, Severstal isn't pulling the plug just yet. Shevelev said the company aims to keep both production and investment plans on trackthough he didn't rule out deeper cuts if things worsen. Any shift in monetary policy could offer some breathing room, but for now, investors should stay alert. Russia's steelmakers may be entering a new phase of survival modewhere efficiency, cost control, and macro resilience will separate the winners from the rest. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
4 days ago
- Business
- Yahoo
Russia's Steel Industry on the Brink? Severstal Warns of Potential Shutdowns
Steel demand in Russia is heading into rough terrainand Severstal (SVJTY) is waving a red flag. CEO Alexander Shevelev told Rossiya-24 that some production lines may need to shut down to balance oversupply as domestic consumption could drop 10% this year, down to 39 million tons. That's a steep declinecomparable to the full-year appetite of some entire industries. With steel prices sitting at multi-year lows and the strong ruble choking exports, many producers are now walking a fine line between breakeven and red ink. This isn't just a sector storyit's a window into the wider slowdown rippling through Russia's economy. Last year's rate hikes to tame inflation are still casting a long shadow. The Economy Ministry is now warning of recession risks, and exporters are getting squeezed by a ruble that's surged nearly 23% since 2023. At a current rate of 78.72 per dollar, the ruble is far from the 90100 range Shevelev believes would better support trade. That FX pressure is compounding pain for commodity sellers across oil, steel, and beyond. Despite the storm clouds, Severstal isn't pulling the plug just yet. Shevelev said the company aims to keep both production and investment plans on trackthough he didn't rule out deeper cuts if things worsen. Any shift in monetary policy could offer some breathing room, but for now, investors should stay alert. Russia's steelmakers may be entering a new phase of survival modewhere efficiency, cost control, and macro resilience will separate the winners from the rest. This article first appeared on GuruFocus.
Yahoo
4 days ago
- Business
- Yahoo
Russia's Steel Industry on the Brink? Severstal Warns of Potential Shutdowns
Steel demand in Russia is heading into rough terrainand Severstal (SVJTY) is waving a red flag. CEO Alexander Shevelev told Rossiya-24 that some production lines may need to shut down to balance oversupply as domestic consumption could drop 10% this year, down to 39 million tons. That's a steep declinecomparable to the full-year appetite of some entire industries. With steel prices sitting at multi-year lows and the strong ruble choking exports, many producers are now walking a fine line between breakeven and red ink. This isn't just a sector storyit's a window into the wider slowdown rippling through Russia's economy. Last year's rate hikes to tame inflation are still casting a long shadow. The Economy Ministry is now warning of recession risks, and exporters are getting squeezed by a ruble that's surged nearly 23% since 2023. At a current rate of 78.72 per dollar, the ruble is far from the 90100 range Shevelev believes would better support trade. That FX pressure is compounding pain for commodity sellers across oil, steel, and beyond. Despite the storm clouds, Severstal isn't pulling the plug just yet. Shevelev said the company aims to keep both production and investment plans on trackthough he didn't rule out deeper cuts if things worsen. Any shift in monetary policy could offer some breathing room, but for now, investors should stay alert. Russia's steelmakers may be entering a new phase of survival modewhere efficiency, cost control, and macro resilience will separate the winners from the rest. This article first appeared on GuruFocus. Sign in to access your portfolio
Bloomberg
4 days ago
- Business
- Bloomberg
Top Russian Steelmaker Sees Risk of Shutdowns as Economy Slows
Slumping Russian steel demand, due to a construction slowdown amid broader economic weakness, may force some of the country's producers to halt output, according to Severstal PJSC 's chief. 'The shutdown of some metallurgical production facilities in Russia can not be ruled out as a measure to balance supply,' Severstal's Chief Executive Officer Alexander Shevelev said in interview with Rossiya-24 television channel.
The Star
03-06-2025
- Business
- The Star
Russian billionaire says replacement of SAP software is costly but essential
FILE PHOTO: Alexey Mordashov, Chairman of the Board of Directors of Severstal, attends the Congress of the Russian Union of Industrialists and Entrepreneurs in Moscow, Russia March 18, 2025. REUTERS/Maxim Shemetov/File Photo MOSCOW (Reuters) -Russian steel billionaire Alexey Mordashov said that developing a homegrown alternative to the widely-used business software made by Germany's SAP will require more time and money than anticipated but is a matter of survival. SAP, which became Europe's largest company by market capitalization this year, makes software that helps businesses manage functions from marketing and human resources to logistics and procurement. SAP provided software to Russia's largest companies, including airline carrier Aeroflot and Russian Railways, but gradually curtailed its business in response to Moscow dispatching troops to Ukraine in 2022 and stopped operations in March 2024. Steelmaker Severstal, owned by Mordashov, and petrochemicals firm Sibur have jointly sought to develop an alternative to SAP software. "We have done a lot to study this issue over the past year, but it turned out that everything is much more expensive and complicated, requiring more meticulous refinement," he said at a technology conference. "We understand the importance of this task... because we need to survive," he added. SAP held up to 60% of the Russian market for business software before the Ukraine conflict, with the rest mostly divided between Microsoft and Oracle. Currently, many Russian companies are still using pre-installed SAP software but lack access to updates and support from the German company, making their systems vulnerable to failures. Mordashov's statement highlighted the difficulties experienced by Russian companies as they try to develop alternatives to Western software amid Western sanctions. Severstal and Sibur initially teamed up with domestic software maker Consist but have since exited the partnership. Severstal is now looking into solutions provided by developer Business Technologies. Other Russian companies like Russian Railways and oil firm Gazpromneft have chosen to cooperate with developer 1C, and are planning to launch a domestic alternative to SAP software in 2027. (Reporting by Anastasia Lyrchikova, additional reporting by Oksana Kobzeva, writing by Gleb Bryanski, editing by Alexandra Hudson)
