One Of The Largest Metallurgical Plants In Russia Halted Part Of Its Production
2- 31.03.2026, 13:27
- 6,596
A reason has been given.
The management of the Chelyabinsk Electrometallurgical Combine (CEMC), Russia's largest ferroalloy producer, has decided to shut down one of its shops for three months, 74.RU reported, citing company employees. "They are closing the fifth shop - the smelting shop [since April 1]. There have been talks for the last month, now it's [known] for sure," the employees said. According to them, there is no official document about this yet, but the verbal information "is being passed on from the management as a resolved issue," with the workers being offered to "take days without pay or move to another shop."
Chemk itself confirmed the data about "a three-month reduction in production at the ferroalloy smelting and processing section." The reason is "a significant decrease in demand for ferroalloys and, as a consequence, the lack of opportunity to sell all the currently produced products". The company assured that 170 employees of the unit will be temporarily transferred to other shops and will be given paid vacations. CHEMK, which was nationalized in February 2024 following a lawsuit filed by the Prosecutor General's Office, was already switched to a four-day work week in September 2025 due to a sharp drop in demand.
The plant managed by the Federal Property Management Agency (Rosimushchestvo) made a net loss of 7.12 billion rubles in 2024 (against a net profit of 4.18 billion rubles in 2023). According to the SPARK system, last year about 250 lawsuits were filed against the plant with claims totaling more than 1.3 billion rubles, and since the beginning of 2026 - more than 30 more claims for 72 million rubles, Kommersant wrote in February. Most of the claims are related to debts to contractors from different regions.
Chemk became the second major steel mill to cut production this year due to the slowdown in the economy, high interest rates on loans and problems with export sales. Earlier, the Magnitogorsk Iron and Steel Works, which is among the top 3 in the country in terms of output and provides 20% of steel products on the Russian market, announced a reduction in utilization to 60%. To cut costs, MMK also plans to lay off 10% of its management staff, the company's CEO Pavel Shilyaev reported.
Another metallurgical giant, Severstal, last week announced a reduction in 2026 investments: capex, expected to be 147 billion rubles, will be cut by 24% and the repair fund by 5%. Labor costs are also being cut. "The situation in the industry is getting more and more complicated. Demand for steel in Russia has fallen 31% since the beginning of 2024, leading to a sharp decline in utilization at our key customers and falling prices... The reality is that it is impossible to completely avoid optimization measures," said Alexander Shevelev, head of the company.
Metallurgists are cutting capacity as the crisis in the industry grows. In January-February 2026, metallurgical production in the country declined in annual terms by 11%, analysts close to the Kremlin at CMACP stated.
"Metallurgy is openly going into survival mode," said Finam's chief strategy officer Yaroslav Kabakov. - Cutting investment programs by a quarter - as in the case of Severstal - is no longer optimization, but a signal that the industry sees no points of growth. The decline in industrial production and weak domestic demand are taking the sector down, while exports are limited by logistics and price volatility".
Bank's name: Bank Millennium S.A.
Address: ul. Stanislawa Zaryna, 2A, 02-593, Warszawa
IBAN: PL97116022020000000216711123
SWIFT: BIGBPLPW
Name of the account holder: Fundacja “KARTA ‘97”
Purpose/title of payment: Donation for statuary aims
You can contact us by the e-mail charter97@gmail.com
