Mechel stops shipments to stainless steel traders

In the end of Dec 2010 Mechel’s management adopted a decision to discontinue shipments of stainless steel to traders who had been its large customers, selling Mechel’s steel products to end-users.

The intention of making such a decision was, as quoted:

“… to increase direct sales to end-users, Mechel’s management decides to discontinue shipments to intermediary structures (i.e. traders) of the following product assortment:

- stainless steel sheets;

- HR and forged stainless steel long products;

- stainless steel long products with special finishing;

- stainless steel tubular billets.

The currently placed orders must be cancelled with the refunding of advance payments.

Any future sales to traders is now banned.”

Mechel has devided all buyers for the admitted ones and denied ones. For a monopolist such a behavior looks logical. Though, we wonder for whom did the traders buy stainless steel from Mechel? Obviously, for end-users who are compelled to break up their business ties with the traders and go cap in hand to its majesty Mechel. We doubt the Mechel’s decision is consistent with the current antimonopolistic regulations in Russia. We think, the case is for the Russian antimonopoly service.

Spetsstal invites all overseas producers and suppliers of stainless steel to discuss the above-raised topic as well as many other topics regarding the Russian market for stainless steel at the forthcoming international conference ‘Stainless Steel Price – 2011’ to take place in Moscow on 17 February 2011.

Hot issues of inner and outer impacts on the Russian stainless steel market to be discussed at the Feb 2011 Conference, such as:

- new anti-dumping duties on imports of STS flats;

- change of special duties on imports of STS tubes;

- local STS makers’ policies on the Russian inner market.

Kindly refer for all the details and registration at http://inox-conference.ru/index_en.php