Ukrainian daily steel output rises 5% mom in April

Ukrainian steelmakers increased steel production 2% mom to 2.95 mmt in April, implying 5% mom growth in average daily output. In 4M12 on aggregate, steel output declined 5% yoy to 11.1 mmt, while output of finished steel products decreased 10% yoy to 9.3 mmt.

Roman Topolyuk: Ukraine’s steel industry increased production for a second straight month, after a 10% mom increase in daily steel output in March. This was in line with our expectations, but we project moderation in growth in May and June due to seasonal weakening in demand for steel products, and a decline in prices that has already started. We believe the sector might decrease production 4-5% yoy in 2012 to 30.0-33.4 mmt. This will cause a minor negative effect on non-integrated steel makers that can just breakeven in the best case due to high raw materials and relatively low steel product prices.