NLMK temporarily reduces pig iron production

Due to deterioration in demand in the pig iron market both in Russia and abroad in Q2 2012, starting from July 6, 2012 NLMK is idling its blast furnace (BF) #2 with a capacity of 0.8 mt/y (around 6% of the total pig iron capacity at the Lipetsk plant) for a period of up to 60 days.

This decrease in the output of commercial pig iron will not impact the overall crude steel and rolled product output in the second half of 2012. The idling of BF#2 will allow increasing the loading efficiency for NLMK’s remaining blast furnace operations at its Lipetsk plant. NLMK Group confirms its previously announced steel production forecast for 2012 at around 15 mt/y (+30% y-o-y).

NLMK Group’s pig iron production capacities (blast furnaces) are concentrated at Novolipetsk (the Company’s main production site in Lipetsk). With the new blast furnace #7 launched at the end of 2011, these total around 12.5 mt/y of pig iron. Novolipetsk annual pig iron sales total around 0.8-1.0 mt/y.