Efficiency programmes save millions for Russian steelmaker MMK

Based H1 2019 results, the implementation of programmes aimed at improving production efficiency at Russian steelmaker Magnitogorsk Iron and Steel Works (MMK) has had an economic impact in excess of US$ 38.3 million.

As part of the strategic initiatives adopted in 2015 aimed at improving operational and functional efficiency, The Russian steelmaker MMK claims it has been working consistently and comprehensively over a number of years to reduce consumption of all types of resources and to seek opportunities to further improve efficiency. As a result, since 2016, it has received an increased profit of US$ 283.26 million. This includes the impact of low-budget high-efficiency investment projects (so-called 'Baby Capex') which MMK says has contributed in excess of US$ 41.34 million.

During H1 2019, the optimisation of technological processes had an impact of USD 18.37 million, the introduction of 'Baby Capex' had an economic impact of US$ 7.5 million, invention and innovation provided a saving of more than US$ 4.6 million and the implementation of energy saving measures allowed for a saving of US$ 8.2 million.

According to MMK, saving fuel and energy resources had the most significant economic impact (US$ 19 million), followed by base and raw materials (USD 9.75 million) and auxiliary materials (US$ 5.74 million). The total economic impact for the first six months of 2019 amounted to more than US$ 38.3 million.

MMK claims that tight control over resource expenditure and the search for domestic reserves to reduce costs allow the company to counter the negative impact of market factors, to ensure the competitiveness of its products and maintain a strong presence among the leaders in both the domestic and global steel industry in terms of economic efficiency.