Centravis Production Ukraine PJSC (Centravis Production Ukraine), which is a part of Centravis Ltd. holding, is working at full capacity due to electricity supply for production needs.
According to Artem Atanasov, chief sales officer (CSO), in a letter to customers last Friday, Centravis production is operating efficiently after the overhaul of the press line.
“This (last – IF-U) week we got our production up and running at full capacity. Our key equipment is fully energized, the hot shop and the cold shop are running. All equipment is working and production is supplied with all the necessary materials,” stated the Director of Sales.
He also said that the logistics team constantly monitors the safest ways of delivering finished goods. The company has sales offices around the world in Essen, Milan, Krakow, Lugano, Houston and Dubai.
“We are ending this year with good results. “Centravis produced more than 10,000 tons of seamless pipe in 11 months. We paid more than 230 million UAH in taxes for 10 months of 2022. During this year we participated in three international exhibitions and we are proud that we are among the world leaders (in production of stainless tubes – IF-U). We achieved this thanks to the support of our customers, our team and partners,” Atanasov emphasized.
“Centravis is among the ten largest manufacturers of seamless stainless steel pipes in the world. The company’s production is concentrated in Nikopol, which since July of this year has been under almost daily fire from Russian troops.
In 2021 the company has realized a number of large-scale orders for such world companies as Benteler Automotive, LINSTER Edelstahlhandel, Rohr Mertel, Buhlmann Group, Webco, MRC. “Centravis works with such famous automobile brands as BMW, Volkswagen, General Motors. Supplies pipes for nuclear power plants, fresh water storage facilities, the International Thermonuclear Experimental Reactor (ITER) and other landmark projects.
“Centravis is one of the world’s largest manufacturers of seamless stainless steel pipes, founded in 2000. Its production facilities are located in Nikopol (Dnepropetrovsk region).
Centravis Ltd Holding was created on the base of Nikopol Stainless Tube Works CJSC, service and trading companies of Uvis Industrial and Commercial Enterprise Ltd. Its shareholders are members of the Atanasov family.
Centravis Ltd. owns 100% of shares of Centravis Production Ukraine PJSC.
Asia-Pacific stock indices rebounded positively on Monday after the U.S. stock market rallied at the end of last week.
Australian and Hong Kong stock exchanges as well as U.S. and most European countries are closed because of the Christmas holiday.
The Bank of Japan is not going to abandon its ultra-soft monetary policy any time soon, Central Bank Governor Haruhiko Kuroda said.
Last week, the Japanese central bank unexpectedly widened the range within which the yield on ten-year government bonds can fluctuate to plus/minus 0.5% per annum from plus/minus 0.25% previously. Investors took that as a signal that the Bank of Japan was preparing to abandon the ultra-soft monetary policy that it had been pursuing for years.
But Kuroda on Monday rebutted that view, saying that the corridor widening was aimed at boosting the effect of monetary policy and was not the first step in abandoning a major stimulus program. He also noted that the country’s consumer inflation rate could slow below the Bank of Japan’s 2% target in the next fiscal year, which begins in March 2023.
The value of Japan’s Nikkei 225 index rose by 0.65% in trading.
Shares of electronic components maker Sharp Corp. (+3.6%) and commodity companies including JGC Holdings Corp. (+3.5%), Inpex Corp. (+2.5%) and Nippon Steel Corp. (+2.3%) were among the leaders.
In addition, chip maker Advantest Corp. (+1.2%), clothing retailer Fast Retailing (+2%), consumer electronics maker Sony Group (+0.3%), automakers Nissan Motor (+1.9%) and Toyota Motor (+0.3%) went up.
Mitsubishi Electric Corp. and Mitsubishi Heavy Industries Ltd. announced Monday that they intend to merge their generator businesses to become more competitive in the market. The companies plan to sign a definitive agreement at the end of May 2023 and complete the merger of the units by April 1, 2024. Mitsubishi Electric is expected to become the majority shareholder of the new merged company, while Mitsubishi Heavy Industries will become a minority shareholder.
Mitsubishi Electric’s share price rose 1.3 percent and Mitsubishi Heavy Industries rose 2.7 percent.
China’s Shanghai Composite index gained 0.65% over the day.
Technology and consumer companies, including Huizhou China Eagle, up 1.5%; Shenzhen Infinova, Zhejiang Netsun and Xi’an Catering, up about 10%; and automaker BYD, up 4.1%.
The People’s Bank of China on Monday provided banks with 216 billion yuan ($30.9 billion) in reverse repurchase transactions to ensure sufficient liquidity in the financial system at the end of the year. Last week the net inflow of funds into the country’s financial system amounted to 704 billion yuan, the highest weekly infusion since October.
The value of the South Korean Kospi index increased by 0.15%.
Stocks of one of the world’s largest chip and electronics maker Samsung Electronics Co. fell 0.3% and automaker Hyundai Motor rose 0.6%.
A strong rise in quotations showed securities of pharmaceutical companies Kyongbo Pharmaceutical and Samil Pharmaceutical – by 16.3% and 4.5%, respectively.
Agro-industrial group of companies Ovostar Union, one of the leading egg and egg products producers in Ukraine, will pay EUR3.6 mln of interim dividends for 2022 based on EUR0.65/share, the company announced on the Warsaw Stock Exchange.
It is specified that the date for determining the right for the interim dividend will be January 13, 2023, and its payment will take place no later than January 27, 2023.
Ovostar Union Group is a vertically integrated public holding company, one of the leading producers of chicken eggs and egg products in Europe. The producer has been a certified exporter to the EU since 2015.
The group’s holding company, Ovostar Union N.V., held a 25% IPO on the Warsaw Stock Exchange in mid-June 2011 and raised $33.2 million. The majority stake in the company is owned by Prime One Capital Limited, which is controlled by its CEO Boris Belikov and Chairman of the Board Vitaliy Veresenko.
“Ovostar reported $1.65 million in net income for 2021, down 38 percent from 2020. Its EBITDA was down 29% to $5.7 million, while revenue increased 35% to $133.3 million.
Dynamics of export of goods in 2021-2022
export.gov.ua
By the end of this year, metal prices and logistics costs have dropped significantly, which should help the demand
Russia’s military aggression against Ukraine has had a significant impact on the entire economy and the construction industry in particular. However, after a few months of war, some of the customers have already returned to the construction of commercial objects that were frozen at the beginning of the full-scale war or damaged as a result of the hostilities.
Current situation
Rauta is a leading supplier of modern solutions for quickly erected buildings – sandwich panels, ventilated metal facades, steel frames, load-bearing profiles, etc. The company offers services in design, installation of supporting and enclosing structures, as well as general contracting on objects of any complexity. The main focus of the company’s business is the import of Ruukki products for commercial construction projects. We use production facilities located in Poland, Estonia and Ukraine.
After the beginning of the active war phase due to a significant decrease in demand for our products the company’s business was significantly reoriented. We began to be approached by clients with requests to rebuild buildings destroyed in the fighting. Having a deep understanding of the technologies and principles of reconstruction, we began to actively engage in the restoration of buildings and made it a separate line of business. Whereas before February 24 the company was restoring only one building in Kiev, by the end of 2022 we had implemented 7 projects in three cities of Ukraine, and the start of reconstruction of several more is planned for 2023.
Growth against the backdrop of a falling market
In 2021 there was a situation on the market when the demand for Ruukki products greatly exceeded the capacity of production and the factories were not able to fulfill all orders. Starting from 24 February, the number of orders for new construction projects decreased sharply, and the main deliveries were for objects that began construction last year. Fortunately, almost all of our sandwich panel customers continued to build facilities. Among them are low-temperature warehouse and business center in Kiev, dairy farm and dairy plant in Ternopil region. Therefore, in 2022 Rauta has a 40% year-on-year decrease in sales, which is a relatively good indicator against the background of a more than 70% fall in the sandwich panel market. At the same time, thanks to the growth of the construction and general contracting services area, the company’s total revenue increased by 7% compared to 2021.
Price waves
Ruukki products are made only from European rolled steel, the price of which rose to a peak in August 2021 and halved in early 2022. At the same time in the cost of panels, galvanized steel with polymer coating accounts for about 25%.
At the same time, given the substantial increase in the cost of transportation services and the rise in the euro, the price of imported sandwich panels for the year increased by 50% in hryvnia equivalent. Nevertheless now there is a tendency in the market to considerable decrease of transport cost as well as inertial fall of world steel prices that in the nearest perspective can lead to reduction of sandwich-panels prices by 15-20%.
The main method of delivery in the market of metal construction is road transport. In 2021 the cost of delivery by truck from Poland to Kiev was about 65 thousand UAH. In the spring of 2022 delivery from Poland due to rising fuel prices and limited supply of transport has doubled in price, and in December 2022 was back to the prewar level.
In 2021 the peak cost of load-bearing steel reached almost 70 thousand UAH per ton, mainly due to the high cost of rolled steel. At the end of 2022 due to the decline in metal prices by almost half the cost of steel decreased by about 23% – to 54 thousand UAH per ton.
Recovery Opportunities.
In the spring of 2022, when the company had less workload on the main projects, we have developed a technology for the construction of frameless houses made of sandwich panels, which can be used for ultra-fast construction of houses and cottage towns. To demonstrate the benefits of this technology, we plan to install two demonstration frameless houses near Kiev. For this purpose we have already made house sets in Poland for 20 and 40 square meters houses and we are going to install them in spring. Now we can see the interest in this technology on the part of institutional funds and private investors in the segment of cottage building, which will grow rapidly after Ukraine’s victory.
Another innovation of ours is the development of technology for construction of multistoried buildings using sandwich panels as outer walls, which allows a developer to get up to 5% more space.
In general it can be noted that the technology of rapid construction with steel solutions has a great perspective in the reconstruction of commercial real estate – where the investor understands: the sooner the business is built, the sooner it will begin to bring income.
CONSTRUCTION, DEMAND, galvanized steel, RAUTA, STEEL, STEEL CONSTRUCTION
The U.S. dollar weakened against major world currencies on Monday due to the low trading activity because of the Christmas holidays.
The WSJ Dollar Index, which tracks the dollar’s movement against 16 currencies, is down 0.12%.
The euro is trading around $1.0629 versus $1.0617 in the previous session.
Analysts of Danske Bank have raised the forecast for the euro exchange rate in twelve months to $0.98 from the previously expected $0.93. The British national currency – to $1.15 from $1.08. At the same time they suggest that the Japanese national currency will cost about 128 yen/$1.
The value of the single European currency is now around 140.95 yen compared to 140.98 yen on Friday. The dollar is at 132.58 yen versus 132.79 yen at the end of the previous trading day.
The pound is trading at $1.2069 compared to $1.2051 on the previous trading day and the euro is at £0.8808 compared to £0.8810.
