Russia Steelmakers’ Earnings to Rise

Moody’s expects an upsurge in the earnings of Russian steelmakers on the back of the country’s economic uplift, Tass reported. “Recovering demand for steel in Russia on the back of GDP growth and declining mortgage rates will buoy steelmakers’ earnings in 2018-2019,” the agency said in a report “Steel—Russia: Domestic demand supports earnings, but trade barriers and sanctions pose risks” released on Thursday. However, a looming trade war and the risk of escalating sanctions could threaten steel producers’ strong position in export markets, Moody’s added. “Steelmakers’ EBITDA margins will remain high on the back of the weak ruble and continuing efficiency gains, although the potential for further cost cuts will likely decrease,” the report said. Meanwhile, Russia plans to take retaliatory measures against the United States’ import duties on steel and aluminum, Prime Minister Dmitry Medvedev said on Wednesday. He noted that the US decisions are “discriminatory” in nature and cannot remain without consequences. “The countries of the European Union, China have already taken reciprocal steps. We also need to think about introducing retaliatory measures, I ask the economic development ministry to prepare relevant proposals,” Medvedev said.