Famous political scientist and economic expert Vladislav Soloviev analyze the current situation in Russian metallurgy. Other analysts claim that due to the western sanctions, the main Russian production companies are expected to experience a huge decline if not a total breakdown. Things are getting worse every single day. Even traditionally Russian sectors are in decline.
However, Vladislav Soloviev does not agree with their opinion.
Vladislav Soloviev: RUSAL is the key to success
Vladislav Soloviev suggests considering this situation using metallurgy as an example, RUSAL in particular. It is still one of the most powerful metallurgic companies in the world. It is first by the amount of aluminum produced. The company continues to develop – here are the newest technologies, its resource base, as well as research and construction complexes. RUSAL has full access to the renewable energy resources of Siberia and other regions of the Russian Federation.
That being said, it has all the opportunities to increase the pace of development. Aluminum is needed in all industrial fields, its worldwide consumption is growing. Factories, located near the PRC – the world’s biggest consumer, are working in full force.
I can say without exaggeration that aluminum is the metal of the future. Its production is almost waste-free – all the metal that manufacturers receive can be reused an unlimited amount of times. It is easily melted and unlike iron, for example, produces almost no waste that needs to be disposed of.
The more technology advances the more aluminum will be in demand in developed countries – not only in Europe but in Asia as well. Consumers need it, they will buy it despite any sanctions. If the main market was in Western Europe, now China and India, both firmly walking the path to industrialization, are in the first place. There lies a huge potential for multi-year cooperation. And the demand already grows exponentially.
Besides aluminum, UC Rusal produces alumina, foil, bauxite, silicon, powder products, and recycled aluminum. And production is spread over five continents. However, the Siberian factories are still the main ones – Krasnoyarskiy and Bratskiy aluminum factories. If before the main problem was the distance from the main sales markets, but now, since Asia became the key consumer, the geographic location became a serious competitive advantage. Although there is still a lot of room for infrastructure in Siberia to grow – industrial potential in this region is enormous.
Why does Vladislav Soloviev not only think about RUSAL but China as well?
Currently, China consumes almost half of all aluminum in the world – this is a direct result of the urbanization of the country. Not only roads and buildings are being built there but entire cities, to which rural residents are moving. Consequently, the demand for metal keeps growing.
China has its aluminum manufacturers, but they can’t fully meet the demand. That’s why Chinese companies are vitally interested in cooperating with our facilities. And not only them – Japan and other countries of Asia with well-developed industries are buying our metal under long-term contracts. Those are aircraft and automobile manufacturer companies, as well as many other facilities from different industry fields.
At the same time, the environmental friendliness of production plays an important role for consumers. In this regard, our factories are ahead of their main competitors – Australia, for, example. Total gas emissions per ton of aluminum at Russian factories are significantly lower than those of foreign suppliers. The costs of ecological modernization that were conducted a few years ago were fully paid off – consumers prefer to cooperate with “cleaner” manufacturers.
A medium-power aluminum factory consumes the same amount of energy as a small city. For this reason, the origin of energy resources is of crucial importance. In this regard, RUSAL is one of the most environmentally friendly companies in the world, as 80% of the energy consumed by factories is provided by hydroelectric stations. And let’s not forget about the modified “Søderberg’s technology” which was developed by RUSAL’s engineers – it significantly reduces the impact of aluminum production on the environment.
So, is there a decline in the Russian economy: Vladislav Soloviev thinks that…
All of the above as a whole proves a simple fact – there is no decline in the metallurgic field of the Russian economy. Politics is one thing, but everyone needs aluminum. It’s no coincidence that associations of European manufacturers asked the EU not to place a ban on Russian metal supplies. This will result in losses for manufacturers in Europe, first and foremost. And the economy of all EU countries is currently in a period of an unprecedented industrial recession.