Russian industry lowers production
As demand decreases and raw material prices shrink, several Russian industrial giants are cutting production. Meanwhile, experts say the international financial crisis will also give reduced salaries and higher unemployment.
The Russian steel major Severstal now confirms that it is cutting production in October following the financial crisis and lower demands. Alone the company’s plant in Cherepovets will this month produce 25 percent less than the normal, Vedomosti reports.
The company is not alone. Also other companies say they are planning cuts in production.
With the production cuts come also job cuts. In a round table conference on the issue yesterday, Vice President of the Russian Union of Industrialists and Entrepreneurs (RSPP) Fyodor Prokopov said that financial crisis will not hit only the financial sector. He warns about upcoming major job cuts in a number of companies.
Several million people might end up without a job following the crisis, newspaper Nezavisimaya Gazeta reports. Alone in the construction industry, the number vanishing jobs might number a million.
Meanwhile, the prices on vital Russian raw materials continue to drop. The spot price on oil Urals today fell five percent to 76,3 USD per barrel. Also prices on nickel drop rapidly. According to Vedomosti, futures on nickel today dropped 10 percent to 12,150 USD per ton and cupper by 9 percent to 4830 USD per ton.
