Pipe And Iron Ore Concentrate Production Lead Ukrainian Metallurgy In Jan-Feb

In the first two months of 2006, pipe production grew 5% yoy to 322 ths mt, and iron concentrate output inched upward 1% yoy to 8,460 ths mt. At the same time, sinter production fell 4% yoy to 7,509 ths mt, and pellet production slid 4% to 2,791 ths mt. Crude steel output for the period totaled 6,087 ths mt, down 3% yoy, and rolled steel production amounted to 5,177 ths mt, down 2% yoy. Concorde Capital: The depressed production of steel makers was due to limited gas supplies in Jan-Feb 2006. This led to reduced consumption of sinter. The fall in pellet production was due, not only to a weaker demand from steel producers, but also to its relatively high price compared to iron ore concentrate, and a temporary slump in exports. We see downward pressure on pellet prices at the moment. However, these prices will ultimately be determined by the results of negotiations between Chinese steel makers and the world’s three largest iron ore miners. Demand for pipes remains strong and this industry was less affected by gas issue currently facing Ukraine. Thus, pipe production continued to grow.