Sales markets

Our sales strategy is based on efficient sales channels and a proactive and flexible marketing system.

Global steel market

2015 world steel production declined by 2.8% year on year to 1,589 billion tonnes, while average capacity utilization rates stood at 70%. Steel output in China decreased by 2.1% year on year to 801 million tonnes, China accounting for 50.4% of total global steel production. Production volumes in developed countries also decreased.

Demand for steel in China that accounts to 45% of global steel use in 2015 decreased by 5.4% year on year to 672 million tonnes. The fall in demand outstripping the fall in production led to unprecedented rise in exports by 20% year on year to 112 million tonnes.

2015 global steel prices decreased by 30-40% year on year due to increase in steel exports from China and a decrease in raw material prices (iron ore and coking coal prices were down by 30% and 40% over the course of the year).

Sales by region

We constantly monitor and analyze key market events to identify opportunities for development of sales. We employ export traders within the Group whose flexible approach to sales enables us to exploit the most favorable markets.

Accounting for approximately 40% of the Company’s total sales, the Russian market is key for NLMK. NLMK Europe and NLMK USA account for 15% and 11% of the Group’s total sales in their respective regions. NLMK Group holds strong positions in international markets, delivering products to customers in more than 70 countries worldwide.

Sales by regions, k tonnes 
    2010     2011     2012     2013     2014 2015
     Russia      3 704      4 267      4 875      5 788      6 596 6 166 
     European Union      3 039      2 865      2 824      2 529      2 873  3 489 
     Middle East & Turkey      1 917      1 606      1 280      1 463      1 007 1 403 
     Asia      1 202      1 334      2 184      1 440      457 584
     North America      1 383      1 730      2 413      2 102      2 787 2 370 
     Rest of the World      486      1 038      1 608      1 508      1 433  1 810 
     Total      11 730      12 840      15 184      14 828      15 126 15 863 

Russian steel market

2015 crude steel production was 70.9 million tonnes (-0.8% year on year). Steel consumption dropped by 8.4% year on year to 39.5 million tonnes.

Imports of finished steel products were down by 29% year on year to 4.5 million tonnes due to ruble devaluation and decline in demand.

EU steel market

Steel production by European steelmakers in 2015 declined by 2.1% year on year to 165.5 million tonnes.

According to Eurofer, apparent steel use in the EU rose by 2.3% year on year in 2015 to 150 million tonnes, while real steel use was up by 1.3%.

US steel market

Demand for steel was supported mainly by the construction and automotive sectors, with machine-building and energy sectors displaying a downward trend.

Crude steel production declined by 10.5% year on year in 2015 to 78.9 million tonnes, under pressure from cheap imports, the decline in prices and high steel inventories at the end of 2014. Steel product imports declined by 12% year on year to 35 million tonnes, while steel product exports decreased by 17% year on year to 9 million tonnes. 2015 consumption of finished steel products contracted by 10.6% year on year to 96 million tonnes pressured by US dollar appreciation and low oil prices.