[Market Insight] Russian Steel Industry Overview

[Market Insight] Russian Steel Industry Overview

Russia is the fifth-largest steel producer in the world. The country is extremely well endowed with mineral resources. It is rich in natural gas, oil, coal, iron ore, and various metal resources required by a modern industrial nation.  

Part 1: Russian Steel Market 2021 in Figures




  • In 2021, the country produced about 76 million tons of crude steel, accounting for about 4% of the global supply, according to the data released by WSA.

  • In 2021, Russia exported about 30.54 million tons of billets and steel, with a net export of 26.08 million tons, accounting for about 34% of its national crude steel production.


Russia is the world's largest exporter of steel billets. In 2021, the country exported 14.98 million tons of steel billets, accounting for about 28% of global steel billet exports, and exported about 16.52 million tons of semi-finished products, accounting for 4.6% of global steel exports, a significantly higher proportion than long products. In addition, the country is also a major exporter of pig iron, DRI, and scrap.

In terms of export destinations, in 2021, the country's steel products are mainly exported to Europe, the CIS, the Americas, and the Middle East.

In conclusion, Russia is a major contributor and an integral part of the global steel supply.

Part 2: Russian Steel Capacity


  • Novolipetsk Steel (NLMK) is a manufacturer of steel products headquartered in Moscow, Russia, which is one of the four largest steel companies in the country, with a share of 22% in Russian steel production, or about 15.75 million tons.  NLMK is located in Lipetsk, 350 km far from the Kursk magnetic anomaly – a major supplier of raw materials for the company, and 500 km far from Donetsk coal basin.

  • Evraz is a leading integrated mining and metallurgical company with assets in Russia, Ukraine, USA, Canada, Czech Republic, Italy, Kazakhstan, and the Republic of South Africa, with a crude steel production for 2021 of 13.57 million tonnes.

  • Magnitogorsk Iron and Steel Works (MMK) is located in the city of Magnitogorsk, holding leading positions among Russian steel companies. MMK’s assets in Russia represent a large steelmaking complex with a full production cycle, from the preparation of iron ore to the production of downstream products. 

  • Severstal is a vertically-integrated Russian steel and mining company consisting of two divisions: Severstal Russian Steel and Severstal Resources. It owns assets in Russia, Ukraine, Latvia, Poland, Italy, and Liberia, with steel production of about 11.3 million tonnes

Part 3: The impact of the Russia-Ukraine Conflict on the Russian Steel Sector

Tensions between Russia and Ukraine, which have escalated since late February, have begun to rattle steel market participants and affect global trade, especially the steel market. Subsequently, Europe and the United States have announced sanctions against Russia in retaliation for Ukraine's "war crimes", while banning the import of various steel products from Russia.

Russian mining and steelmaking company Severstal ceased shipments to the EU in early March amid EU sanctions imposed on its majority shareholder as a consequence of Russia’s actions in Ukraine.

In addition to this, leading Russian steel producer MMK said on its website that most of its rolled steel is supplied to the domestic market, creating an additional margin of safety for the company.


Meanwhile, Russian government officials have asked steelmakers to set prices below market rates for some period at home as part of measures to a sanctions-induced economic downturn. Government officials want producers to cap profit margins between 20% and 25%. The government intervention had the biggest impact on the steel industry, causing domestic steel prices to fall by at least 15%. In contrast, since the outbreak of the Russian-Ukrainian war, EU steel prices have soared to record highs.

According to the Russian Steel Association, the total reduction in Russian steel demand by 2022 may reach 30% or 13 million tons due to sanctions imposed by the United States and Europe. However, for steel manufacturers, it will inevitably lead to a decline in the competitiveness of Russia's exports, which is equivalent to a ban on exports.

Part 4: Russia-Ukraine Conflict saw Buyers Looking at Other Options

War creates challenges for all participants in the global steel supply chain. We can see disruptions in supply chains, decreasing production volumes, and rising steel prices.


Russia and Ukraine are among the top steel exporters globally, and looking ahead, even if the crisis and sanctions are lifted, there is great uncertainty in Russia. Ongoing geopolitical concerns have raised the prospect of new sanctions on trade with Russia's main steel producer. As a result, with the supply chain disrupted, global steel buyers are trying to look for other options.

One of those options? China, as the world's largest steel producer, is the only one that has the capacity to step up on global steel production, of course. In addition, the world's major producers such as India, Vietnam, Turkey, and South Korea are also likely to fill the global supply gap.


As an integrated steel trading solution provider, we, CUMIC Steel Limited, have long-term cooperation with over 300 mills worldwide. In particular, we are able to provide all-in-one solutions including products from these top mills for your industrial needs. For queries, please contact CUMIC at cumic@cumic.com

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