Given that the converter shop maintenance is expected to
continue until the end of October, steel production is expected to
decrease by approximately 17% in Q4 2012 compared to Q3 2012.
NORTH AMERICA
Product, '000 tonnes Q3 2012* Q3 2011 Q3 2012/ Q2 2012 Q3 2012/
Q3 2011, Q2 2012,
change change
-------------------------- --------- -------- ---------- -------- ----------
Crude steel 611 599 2.1% 616 (0.8)%
Steel products, net
of re-rolled volumes 664 675 (1.6)% 678 (2.1)%
Construction products 78 81 (3.4)% 79 (1.9)%
Railway products 115 121 (4.7)% 134 (13.9)%
Flat-rolled products 252 236 7.1% 254 (0.5)%
Tubular products 219 238 (8.2)% 211 3.5%
-------------------------- --------- -------- ---------- -------- ----------
* Q3 2012 production volumes are preliminary
In Q3 2012, EVRAZ's North American steel output remained flat as
our North American steel mills have continued to operate at high
utilisation levels.
Rail production decreased by 14% compared to Q2 2012 due to
scheduled annual maintenance at the Pueblo rail mill in September
2012. It decreased by 5% year-on-year, because, besides the regular
maintenance of the rail mill in September 2011, crude steel
production at EVRAZ Pueblo is limited and in Q3 2011 available
crude steel volumes were shifted to production of construction
products from rail production.
Production of tubular goods decreased by 8% compared to the same
period last year as a result of a market slowdown leading in
particular to temporary idling of the Camrose DSAW mill. Spiral
weld pipe production was lower vs Q3 2011mainly due to a switch
from 36 inch to 30 inch pipe in 2012 that resulted in a 9,000
tonnes decrease in production volumes. In Q3 2012 tubular goods
production grew up 4% against the Q2 2012 volumes that were
impacted by a Canadian National railroad strike and a labour
dispute in Camrose in May 2012.
In Q4 2012 the rail mill is expected to be fully utilised as
rail demand remains strong. Flat-rolled production is expected to
grow slightly vs Q3 2012. Spiral pipe capacity in Canada is
expected to be fully utilised under existing contracts. Overall
demand for OCTG drilling activity remains stable with some slight
signs of temporary weakness, while the seamless market is expected
to remain solid in the near term.
EUROPE
Product, '000 tonnes Q3 2012 Q3 2011 Q3 2012/ Q2 2012 Q3 2012/
Q3 2011, Q2 2012,
change change
-------------------------- -------- -------- ---------- -------- ----------
Crude steel 81 181 (55.1)% 197 (58.6)%
Steel products 237 270 (12.4)% 267 (11.3)%
Construction products 26 32 (19.5)% 0 n/a
Flat-rolled products 207 216 (4.1)% 243 (14.7)%
Other steel products 4 22 (83.8)% 23 (84.7)%
-------------------------- -------- -------- ---------- -------- ----------
Production of crude steel at EVRAZ Vitkovice Steel (EVS) in Q3
2012 decreased by 55% compared to Q3 2011 and by 59% compared to Q2
2012 as the steel plant did not operate in July-August 2012 due to
scheduled yearly maintenance. Meanwhile, production of steel
products decreased by only 12% and 11% respectively as the plate
mill used purchased slabs for its operations.
Production of flat-rolled products decreased by 4% vs. Q3 2011
and by 15% vs. Q2 2012 in response to weakening plate demand in the
European markets, as well as a two week scheduled maintenance of
the plate mills in the Czech Republic and Italy in August 2012.
The EVS heavy section mill, which was temporarily closed in
February due to weak demand in Europe, resumed operations in July
as a result of margin and price improvement.
On 11 October the crude steel production at EVRAZ Vitkovice
Steel was temporarily closed due to low demand and the company's
plan to reduce its inventory. The rolling mill and heavy section
mills will remain open as the company has open orders through the
end of 2012.
Q4 2012 crude steel production plans will be driven by market
demand.
SOUTH AFRICA
Product, '000 tonnes Q3 2012 Q3 2011 Q3 2012/ Q2 2012 Q3 2012/
Q3 2011, Q2 2012,
change change
----------------------------- -------- -------- ---------- -------- ----------
Pig iron 84 116 (27.1)% 163 (48.3)%
Crude steel 78 120 (35.3)% 153 (49.3)%
Steel products 65 111 (40.9)% 124 (47.3)%
Semi-finished products 0 16 n/a 3 n/a
Finished products 65 95 (31.1)% 121 (46.1)%
Construction products 27 32 (17.4)% 41 (34.8)%
Flat-rolled products 35 55 (36.5)% 66 (47.5)%
Other steel products 4 8 (49.9)% 14 (72.4)%
----------------------------- -------- -------- ---------- -------- ----------
In Q3 2012 production of crude steel and steel products at EVRAZ
Highveld Steel and Vanadium decreased compared to last year and to
the previous quarter as a result of a four-week industrial action
initiated by Highveld's largest union NUMSA. An agreement has been
reached between EVRAZ Highveld and NUMSA, and the steelworks
re-commenced operations on 13 August 2012.
It is expected that the steelworks will return to full
production in October and the output of crude steel and steel
products will increase compared to Q3 2012.
MINING
IRON ORE
Product, '000 tonnes Q3 2012 Q3 2011 Q3 2012/ Q2 2012 Q3 2012/
Q3 2011, Q2 2012,
change change
-------------------------------- -------- -------- ---------- -------- ----------
Iron ore products 5,158 5,436 (5.1)% 5,258 (1.9)%
Lumpy ore (Ukraine) 559 724 (22.8)% 735 (23.9)%
Concentrate, saleable
(Russia) 1,569 1,734 (9.5)% 1,427 9.9%
Sinter (Russia) 1,128 1,009 11.8% 1,130 (0.1)%
Pellets (Russia) 1,397 1,465 (4.7)% 1,528 (8.6)%
Fines ore (South Africa) 153 186 (18.0)% 132 15.8%
Lumpy ore (South Africa) 352 317 11.1% 307 14.7%
-------------------------------- -------- -------- ---------- -------- ----------
Overall production of saleable iron ore products by the Company
decreased by 5% compared to Q3 2011 and was flat compared to Q2
2012.
Sukha Balka produced 23% and 24% less lumpy ore compared to Q3
2011 and Q2 2012 respectively due to production being scaled down
as a result of a skip conveyor repositioning at the Yubileynaya
mine that started in mid-September and is expected to continue
until mid-November. Production of lumpy ore is expected to remain
almost flat in Q4 2012 compared to Q3 2012.
Production of saleable concentrate in Russia increased by 10% in
Q3 2012 compared to the previous quarter as a result of higher iron
ore production. Pellets production decreased by 5% compared to Q3
2011 and by 9% compared to Q2 2012 due to kiln repair at EVRAZ KGOK
iron ore processing plant.
COAL
Product, '000 tonnes Q3 2012 Q3 2011 Q3 2012/ Q2 2012 Q3 2012/
Q3 2011, Q2 2012,
change change
---------------------------- -------- -------- ---------- -------- ----------
Raw coking coal (mined) 2,313 1,237 86.9% 1,935 19.5%
Raw steam coal (mined) 892 889 0.3% 700 27.3%
Coking coal concentrate
(production) 1,627 1,391 17.0% 1,575 3.3%
Steam coal concentrate
(production) 132 338 (61.0)% 190 (30.7)%
---------------------------- -------- -------- ---------- -------- ----------
Equity investments -
Raspadskaya(*)
Coking coal (mined) 1,378 1,212 13.7% 1,843 (25.3)%
---------------------------- -------- -------- ---------- -------- ----------
* Reported numbers are for 100% production. As at 30 September
2012 EVRAZ held a 41% effective interest in the Raspadskaya coal
company.
Coking coal
In Q3 2012, raw coking coal production at Yuzhkuzbassugol
increased by 87% compared to Q3 2011 and by 20% compared to Q2 2012
due to the absence of longwall repositionings at the mines in Q3
2012. The growth of raw coking coal production led to bigger
production volumes of coking coal concentrate.
Q4 2012 coking coal production is expected to decrease, largely
driven by a 60-day longwall repositioning at the Osinnikovskaya
mine.
Steam coal
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