MMK, ChTPZ agree on price formula

UrBC, Chelyabinsk, February 12, 2016. Magnitogorsk Iron & Steel Works (MMK) and ChTPZ Group signed an agreement to determine the price of the hot-rolled metal sheets made at MMK’s Mill 5000 and delivered to ChTPZ Group’s Vysota 239 Department. The agreement was signed by MMK CEO Pavel Shilyaev and ChTPZ Group CEO Alexander Grubman, the two companies’ joint press release states.

The idea is to determine the price of steel sheets on the basis of raw materials’ costs, production costs, and delivery costs. The agreement is valid through 2018.

‘ChTPZ Group and MMK are long-time partners, so, first and foremost, Chelyabinsk pipe manufacturers always receive the metal goods they need on time, and secondly, we work together to make sure Russia’s leading oil and gas companies (operating both in this country and abroad) receive their large-diameter pipes from ChTPZ departments on time as well. We welcome today’s agreement as something that will help both parties react quickly to the changing market opportunities in the mutually beneficial way,’ Shilyaev said.

‘Magnitogorsk Iron & Steel Works is our Vysota 239 Department’s key supplier of steel sheets we need to make large-diameter pipes. MMK delivers over 400,000,000 kg of metal goods to the Group every year. This price formula agreement will let us minimize our risks under the currently unstable economic circumstances and will also make our cooperation more transparent, efficient, and mutually beneficial,’ ChTPZ Group’s Alexander Grubman said.


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