Interpipe reduced steel production by 16.9%

The international vertically integrated pipe and wheel company (TKK) “Interpipe” in January-May of this year reduced steel production by 16.9% compared to the same period last year – to 333.2 thousand tons.

As reported in the monthly report of the company on Monday, over five months, the production of pipes decreased by 33.8% – to 194.2 thousand tons, the production of railway products increased by 13% – to 89.6 thousand tons.

In May, steel smelting amounted to 60.8 thousand tons, output of railway products – 40.4 thousand tons, pipes – 17.6 thousand tons.

It is noted that that the company in January-May increased sales of round steel billets by 130.3% – up to 15.2 thousand tons, railway products – by 17.9%, to 94.1 thousand tons and reduced sales of pipes by 27.8% – up to 188.1 thousand tons.

It is also reported that pipes in January-May of this year were sold in Europe (34%), the MENA region (23%), Ukraine (17%), in the American continent (11%), CIS (12%) and other regions (3%). Railway products – in the CIS (46%), Europe (32%), Ukraine (15%), the MENA region (4%), the American continent (2%) and in other regions (1%).

Interpipe’s commentary explains that the impact of the COVID-19 outbreak and low oil prices continued to weaken OCTG pipe sales in May, while welded pipe and pipe sales rebounded from their early fall. April. At the same time, OCTG sales fell to their lowest level since the beginning of the global oil and gas crisis, having decreased by 36.2% in May 2020 versus May 2019.

Sales of products for pipelines recovered in May by 83.4% on background of actions to ease restrictive measures. The resumption of sales in the UAE was the largest contributor to 39% month-on-month growth.

General pipe sales in May 2020 declined slightly by 3% due to lower supplies to Europe as some regular customers purchased significant volumes earlier in April.

Sales of welded products in May 2020 increased 2.3 times compared to May 2019, as major consumer countries continued to recover from quarantine restrictions, and distributors sought to quickly replenish stocks after weak purchasing activity in the previous months.

A certain increase in sales was observed in the segment of railway products in May – by 8.1%. This is due to the discussion on the restoration of 34.22% anti-dumping duty on Ukrainian railroad wheels in the Eurasian Economic Union (EAEU) from June 1, 2020, and distributors tried to bring their stocks to the limit before the entry into force of this duty. An increase in the supply of wheelsets to Europe by 24.9% additionally contributed to the monthly growth in sales in this segment.

As reported, TCC Interpipe in 2019 reduced steel production by 4.2% compared to the previous year – up to 854.5 thousand tons, including 57.1 thousand tons produced in December. At the end of the year, the output of pipes decreased by 13.3% – to 587 thousand tons (in December – 32.1 thousand tons), but the production of railway products increased – by 11%, to 207.7 thousand tons (19.6 thousand tons).

In 2019, the company increased sales of round steel billets by 22.8% – to 23.7 thousand tons (in December – 0.7 thousand tons), railway products – by 7%, to 202.1 thousand tons (18.2 thousand tons), but reduced pipe sales by 10.6% – to 597.1 thousand tons (53.3 thousand tons). Pipes were mainly sold in Ukraine (25%), Europe (24%) and the American continent (24%). Railway products – in the CIS (45%), Europe (26%) and Ukraine (22%).

Interpipe is a Ukrainian industrial company, a manufacturer of seamless pipes and railway wheels. The company’s products are supplied to more than 80 countries of the world through a network of sales offices located in key markets of the CIS, the Middle East, North America and Europe. In 2019, Interpipe sold 823 thousand tons of finished products, including 202 thousand tons of railway products. Sales of railway products are carried out under the KLW brand.

Interpipe employs 11 thousand people. In 2019, the company transferred UAH 3.25 billion to the budgets of all levels.

The company has five industrial assets: Interpipe Nizhnedneprovsky Pipe-Rolling Plant (NTZ), Interpipe Novomoskovsk Pipe Plant (NMPP), ” Interpipe Niko-Tube, Dnepropetrovsk Vtormet and the Dneprostal electric steel-making complex under the Interpipe Steel brand.

The ultimate owner of Interpipe Limited is Ukrainian businessman Victor Pinchuk and his family members.

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