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Mechel Case `turning point' for Russian metals market
8/27/2008 |
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Russian Prime Minister Vladimir Putin's meeting with steel executives, in which he rebuked OAO Mechel for charging too much for raw materials, marks a ``turning point'' for the industry, a deputy minister said.
``Serious decisions'' will follow yesterday's meeting in Nizhny Novgorod, Deputy Economy Minister Andrei Klepach told reporters in Moscow today. The ``scandal'' about Mechel ``isn't the issue,'' Klepach said. ``This is a turning point for the development of Russia's metals market.''
Mechel, one of Russia's biggest coal producers and its sixth-biggest steelmaker, plunged 38 percent in New York trading after Putin castigated billionaire owner Igor Zyuzin for missing the meeting and urged regulators to investigate the company for overcharging for raw materials and driving up the price of steel.
Putin wants to cancel import duties on iron ore and coal to curb soaring steel prices as the government embarks on record infrastructure spending. The former president has initiated projects to modernize Soviet-era car, aircraft and shipbuilding industries.
As part of the strategy to keep Russia supplied with raw materials for steelmaking, Putin also said he wants the scrap ferrous metals export business to be ``decriminalized.'' Export duties on scrap metals may be raised to encourage more domestic processing, Putin said yesterday. |
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