Closure Of Czech Steel Company. Russia Turned To Be Not Crisis-Proof

　　The second largest Russian steel plant Evraz stoppedproducing steel at its subsidiary enterprise Evraz Vitkovice Steel, as due tothe crisis the demand for the company’s production significantly decreased. Theanalysts warn that the Russian steel industry may suffer from recession soon.

　　As Reuters informs, the work of Evraz Vitkovice Steel(the only steel sheets producer in Czech republic and the largest one inEurope) was frozen because of insufficient demand, with the purpose to cut thecompany’s costs.

　　Czech Evraz also specializes on producing rolled steel, which is widely used for constructing automobiles,ships and bridges. While the process of steel production is stopped the rollingplant will be functioning.

　　As the the representative of Vitkovice Steel JaromirKrisica informed, the length of break in steel production depends on lots offactors, which are currently under the company management’s consideration.

　　As Mr. Krisica informed, some employees of VitkoviceSteel were sent home, they will get 80% of their salaries. Meanwhile otherworkers will be transferred to other plant departments or will perform certainmaintenance work.

　　According to the report of the World Steel Association(WSA), these days the European steel market experiences a huge downturn. Theforecasts of the association show that in 2012 the demand for steel will fallby 5,6%, and in 2013 it will increase by only 2,4%, reaching the level of 148mln tones. The analysts of WSA say that the level of steel consumption inEurope hasn’t grown within the recent time, at the same time the growth ofeconomy in different European countries goes uneven.

　　As the experts affirm, in Europe especially in itsSouthern part, the demand for steel is rather low. At the same time the levelof demand is more dependant on the governments’ policies rather than on thecompanies themselves. This is a serious obstacle for making whatever forecastsespecially regarding the situation on the world steel market.

　　The real alarm at the international steel sector began in October, when the largest steel-castingplant ArcelorMittal stoped the work of its two furances in Floranzh, and theFrench government got 2 months for finding a customer for ArcelorMittal.

　　According to the data from Interfax agency, thedownturn at steel markets may negatively influence the Russian steel industry.Moreover, such negative Russian factors as a bad logistics, inflation and aneccessive level of supply can make the situation on the European steel marketeven worse.

　　It should be noted that theVitkovice steel mill is the main supplier of raw meterials for the Czechdivision of ArcelorMittal. Last year Vitkovice company sold 824 thousand tonesof rolled products and 760 thousand tones of steel slabs.