Russia’s Nornickel lost 50% of its suppliers of spare parts and equipment

The reasons for this are sanctions, the consequences of the coronavirus pandemic, and logistical problems

Russian company Nornickel has lost 50% of its traditional suppliers of spare parts and equipment due to sanctions and logistical problems. The deadlines for the implementation of a number of articles of the investment program may be delayed, Kommersant wrote citing the Reuters.

According to the company’s senior vice president Sergey Stepanov, due to sanctions, the consequences of the coronavirus pandemic and logistical problems, Nornickel lost half of its traditional suppliers of spare parts and equipment.

“Now the company is looking for an alternative, in particular, it hopes to start working with China in the part of equipment supplies. Due to problems with the supply of equipment, the deadlines for the implementation of the “sulfur program”, which, according to the plan, includes a reduction of sulfur dioxide emissions in Norilsk by 90% by 2025, may be postponed,” the report reads.

Russian steelmakers expect a decrease in steel production at the end of the year by 15%, or by 11 million tons compared to the previous year. The largest drop in indicators is predicted for the second half of the year, by 9 million tons, or by 26% compared to the second half of 2021.

Earlier GMK Center reported that Russia’s Magnitogorsk Iron and Steel Works has not been exporting products for three months. With export profits decrease, the company can temporarily stop the investment program. The profitability of the plant decreased from last year’s 20-25% to 4% in May 2022.