MMK builds up on efficiency

Magnitogorsk Iron & Steel Works (MMK) managed to save over 800 million RUR in the first half of 2009 thanks to better organization and stricter control over the manufacturing process.

For one, MMK’s specific consumption of coke and iron needed to produce cast iron decreased by 19.7 and 4.5 kilograms per ton, respectively, against the ante-crisis levels. What is more, the enterprise also used fewer ferrous alloys and supplementary materials, which resulted in a 212-ruble drop in the prime cost of a ton of goods, MMK’s PR Department reports.

In order to fight the recession, the company is also trying to make the most of its raw stock and spare parts to make sure the outgoings are reduced. MMK has used more than 660,000 tons of its scrap metal stock so far, for instance, as well as 50,000 tons from its coal concentrate reserves, 200,000 tons of steel pellets, and 10,000 tons of ferrous alloys. Moreover, the company also relied on its reserves of spare parts and supplementary materials.

Finally, MMK reduced its technical maintenance and repair spending in terms of service, spare parts, and auxiliary stuffs. Then, the stockholders’ expenses also went down; this included a 57% drop in hospitality expenditures, a 61% decrease in business trip spending, and a 50% plunge in auditing and consulting services. All this resulted in a 931-million-ruble decrease in the shareholders’ expenses in the first half of 2009 compared with the year earlier.


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