Formed Refractories Market Research in Russia and Forecast of Its Development in Conditions of the Financial-Economic Crisis
In May, InfoMine issued research of formed refractories market in Russia. The study presents comprehensive analysis of formed refractories market and forecast of its development in conditions of the global financial-economic crisis.
From our estimates, consumption of formed refractories in Russia in 2008 decreased more than 11% year-on-year owing to overall negative impact of the crisis on Russian economy: in the second half of 2008, all end-uses of refractories demonstrated downtrend in production volumes.
In 2009 consumption of refractories in Russia can drop by 17-37% more to 1.1-1.4 mln t, but already in 2010 one can expect stabilizing consumption of the products. Further, while Russian economy will overcome the financial-economic crisis, we expect increasing domestic consumption of refractories in Russia.
For the latest years, one could see strengthening positions of foreign player-suppliers at Russian market of refractories and, as a result, sharpening of competition at the market. Only for the latest 4 years share of foreign refractories in their total consumption in Russia increased by 6.7% to above 17% (in bulk) in 2008. However, Russian Ruble devaluation in late 2008 – early 2009 increased considerably competitiveness of home-produced refractories that allowed forecasting decreasing share of the imported products at the market in short-term prospects. At the same time, we expect expanding exports of Russian refractories.
Diatomite Market Research in the CIS
In the CIS, several companies are involved in mining and processing of diatomite. Notice that in Russia a large share of mined diatomite, owing to its low quality, is used in production of diatomite bricks and heat-insulating materials. For manufacture of filtering materials, Russian companies purchase higher-grade imported products.
In nearest years, a number of projects on mining and production of diatomite products in the CIS were scheduled to be realised, but in conditions of the global financial crisis, the projects can be frozen or postponed. From estimates of «InfoMine» experts, in 2015 volume of mining of diatomite in the CIS can constitute 200 to 300 thousand m3, whereas in 2008 the figure was around 160 thousand m3. The highest figure can be reached in case of realizing the planned projects in accordance with the initial schedule
Asphalt Mixes Market Research in Russia and Forecast of its Development in Conditions of the Financial Crisis
Rates of increasing production of asphalt mixes in Russia in 2008 decreased to 0.9% year-on-year. In 2007, from data of Rosstat, the rates exceeded 30%.
Production of asphalt mixes in Russia is conducted by above 1000 enterprises, most of which produces small volumes of the products. According to assessments of InfoMine, 20 greatest Russian producers of asphalt mixes yield around 24% of total volume of asphalt mixes in the country.
The bulk of production of asphalt mixes in Russia belongs to Central and Privolzhsky Federal Districts (in sum 52% of the total Russian production in 2008) that is owed by the highest degree of development of road network in the Districts. At the same time, to Far Eastern District, only 2% of the total Russian production of asphalt mixes belong.
According to assessments of InfoMine, in 2009-2010 volumes of production of asphalt mixes in the country, even in case of realizing favorable economic scenario, will not exceed the level of 2008. In case of further decreasing investing in road facilities, 20% decline in the production volumes is possible
Cement Market Research in Russia and Forecast of Its Development in Conditions of Financial Crisis
In February, the 6th, revised edition of the Cement Market Research in Russia was issued, in which current situation at the market and prospects of its development in conditions of the global financial crisis are considered.
Consumption of cement in Russia from 2002 to 2008 increased by 64.3% up to above 60 mln t per year. The greatest rates of increasing apparent consumption of cement in Russia were reached in 2006-2007 (above 13% year-on-year) that was connected with expanding volumes of building-and-erection works in the country. However, in 2008 the rates dropped to 1.1% y-o-y in connection with decreasing rates of construction activities in conditions of the financial crisis.
Intensive growth of demand for cement in latest years, in spite of expanding domestic production of cement, also owed considerable increasing imports of the product. In 2004-2007, volumes of cement imports grew annually almost 2 times. In 2008, owing to abolishing custom duties on cement imports and considerable growth of prices on domestic cement in the 1st half of 2008, volumes of cement imports increased 3.3 times y-o-y, and share of imported cement in total volume of its consumption in Russia exceeded 12%. At that, as the imported cement was sold at lower prices and at more profitable terms compared with domestic cement, demand for domestic cement decreased that caused decreasing production of cement in Russia. Impact of the financial crisis on the construction sector, especially heavy in the 2nd half of 2008, resulted in further decreasing demand for cement, in spite of almost two-fold drop of prices on the product. Finally, in 2008, first time for the latest 10 years, volumes of cement production in Russia decreased y-o-y to 89.4% of the 2007 level.
Among Russian regions, for the latest 4 years, Moscow and Moscow region remain the main cement market, share of which in total cement consumption in the country exceeds 20%, according to InfoMine estimates. Notice however that the share of Moscow and Moscow region steadily decreases for the latest 3 years. The second greatest consumers of cement in Russia are St.Petersburg with Leningrad region and Krasnodar krai, which consume around 7% each of total Russian cement consumption. The third place in volumes of cement consumption in 2008 was shared by Sverdlovsk and Chelyabinsk regions – 3% each.
Notice that regional pattern of cement consumption in Russia changed for the latest years. On the background of marked decreasing share of cement consumption in Central Federal District (by 2.1% for 3 years), the shares of Far Eastern District and Privolzhsky District increased by 2.3% and 0.6%, respectively.
Mobile Crushing-and-Screening Facilities for Broken Stone Production: Market Research in Russia
As only one enterprise in Russia manufactures mobile crushing-and-screening facilities for broken stone production, demand for such facilities is mainly satisfied at the expense of imports. For the latest 7 years, imports of the facilities increased above 20 times.
In the opinion of InfoMine’s experts, in 2009-2010, in connection with the global financial crisis, demand for the mobile facilities in Russia will drop considerably, by 15-20% compared with 2008. Later the demand will begin to increase and will reach the level of 2008 in 2012-2013. Increasing demand for the facilities will be encouraged by demand for broken stone, which, in turn, will be promoted by expanding volumes of road building and infrastructure construction works. At that, growing demand for the mobile facilities will be satisfied as before by imports of the products.
Sintered Carbide Alloy Metal-Working Tool Market Research in Russia
Volumes of tool manufacture decreased in Russia 3 times compared with Soviet era (before 1991). Russian producers of the tools lost their positions at world market. According to world statistics, Russia is on the 27th place in consumption of metal-working tools and on the 22th place in its production in the world, whereas until 1991, the USSR was the 3rd greatest consumer and the 2nd greatest producer of the tools in the world. The lost niche at the metal-working tool market was occupied by foreign producers.
At present time, thousands kinds and sizes of metal-working tools are applied in industry. Range of the metal-working tools exceeds 50,000 products, from standard tools of common use (cutting tools, drills, counterboring tools, reamers) to complex assembled tools, for instance, front removable milling heads, gear-cutting tools, combined tools and so on.
Demand for cutting tools changes sharply, especially for new productive facilities, as cutting tools are devices of crucial importance for the facility operation. At the same time, demand for cutting tools is inelastic, and changing prices doesn’t result in considerable changes of overall demand as rule.
In some cases, large companies manufacture required cutting tools themselves. Share of purchased cutting tools in a company provision with the tools is
around 80-85%, and the rest is internally-manufactured.
Russian companies mainly use cutting tools of domestic production. 95% of managers consider the most important factors in the tool purchase are timeliness and tempo of the purchase. 64% of the interviewed representatives of machine building enterprises are not satisfied by quality of purchased cutting tools; at that , nobody conducts preliminary estimate of quality of the purchased tools before the purchase.
Black list of clients
Black list of clients at our web-site is permanently refilled. Now it also includes JSC "Khimprom" (Volgograd) and LLC "TD «Vostochny Bereg»" (Yekaterinburg).
Monthly information-statistic bulletin «CIS Ferrous Metallurgy»
InfoMine Research Group issued pilot monthly information-statistic bulletin «CIS Ferrous Metallurgy». The bulletin presents information on ferrous metals market
in the CIS (Russia, Ukraine, Kazakhstan, Belarus, Uzbekistan), including data on mining and processing of metallurgical resources, production of ferroalloys and key products of the sector: iron, crude steel, rolled steel, pipes, etc.).
You can have a look at the pilot issue of the bulletin, which presents the data on results of January-October 2008, at our web-site: http://www.infomine.ru/otchets/ru_Cherm.pdf
Herbicide Market Research in the CIS
Situation at market of crop protecting agents and, for instance, herbicides in Russia is not in keeping with the national interests and economic security of the country. By now, Russia depends on imports of herbicides, share of which in 2007-2008 exceeded 50% in total volume of the consumption. Situation with provision of Russian producers of herbicides with semiproducts is even worse. For instance, in early 2000s, a facility on production of sodium salt 2,4-D operated in JSC "Ufakhimprom", but now the producers of herbicides depend practically completely on supplies of this and other semis from abroad. At the same time, attempts to organize own (domestic) production failed as yet. Only support of the state can change the situation for the better.
Diammonium Phosphate Market Research in the CIS
As resources for production of ammonium phosphates (ammophos and diammpphos) ammonium and orthophosphoric acid (both wet-process acid and thermal acid), are used. Taking into account features of technologies of ammonium phosphates production, theoretically diammonium phosphate (DAP) can br produced by companies, manufacturing ammophos.
Large-tonnage production of commodity diammonium phosphate in the CIS is currently conducted only in Russia. In addition, the product for internal consumption (in production of complex mineral fertilizers) is manufacturted by Belarussian JSC "Gomel’ chemical plant". In addition, in small volumes, DAP in some years was manufactured by companies of Ukraine and Kazakhstan.
The main producer of DAP in Russia is JSC "Ammophos". In 2007 the enterprise produced 81.4% of total volume of Russian production of the fertilizer. In addition, production of diammonium phosphate is conducted by JSC "Voskresensk mineral fertilizers" (17.7%), and, in small volumes, by LLC "Eurochem-BMU" and JSC "GMZ".
The bulk of diammonium phosphate, produced in Russia, is exported (up to 99%). That is why production of the products depends directly on conjuncture of world market.
The main end-uses are animal breeding (37%), plant breeding (32%), production of mixed mineral fertilizers (21%). The rest is used in production of food yeast, fire retardants.