Chelyabinsk Tube Rolling Plant and Pervouralsk New Pipe Plant (ChTPZ Group’s largest tube and pipe manufacturers) supplied their consumers with 1.27 million tons of tubular goods in January-September 2008, which falls short of the figures for a year earlier by 13%.

ChTPZ sold 675,800 tons of tubes and pipes in the nine months of the year, which falls short of the figures for a year earlier (that is, 803,800 tons) by 16%. These figures include a 28% drop in the amount of large-diameter pipes: this came to 319,800 tons compared with 444,000 tons of LDPs in January-September 2007.

Chelyabinsk Tube Rolling Plant delivered 66,500 tons of tubular goods to consumers in September 2008 (which falls short of last year’s figures (86,200 tons) by 23%), including 32,500 tons of LDPs, which falls short of figures for September 2007 (42,700 tons) by 24%.

Pervouralsk New Pipe Plant delivered 64,400 tons of tubular goods to consumers in September 2008 (which is 14% less than the 75,100 tons delivered a year earlier) and 602,600 tons since the beginning of the year, which is 9% less than the 664,500 tons delivered in January-September 2007.

‘The demand for tube and pipe products first went down at the beginning of the year after the construction of some large pipelines had to be postponed. This trend now continues due to the global financial crisis. The dropping oil prices makes O&G companies (the Group’s key customers) reconsider their investment plans. In addition, the building industry enterprises are now buying much less as well, since this branch was the one that suffered most from the crisis. The same is true of the energy sector, too. Under these trying circumstances, we are thinking of cutting down on our original production output plan. As for investments, the Group intends to timely finish the important strategic projects we have already begun working on and to meet the obligations we have towards our financial partners and contractors. At the same time, we’ll try and cut down on the current capital project through perhaps giving up on the future projects where no responsibility is involved. At the time of a market crisis, ChTPZ Group’s strategy is to cut back on expenses and improve labor productivity,’ says the Group’s General Director Pavel Pelyugin.