OREANDA-NEWS. NLMK Group (LSE: NLMK), the largest steel producer in Russia and one of the most efficient steel companies in the world, has begun upgrading one of its continuous hot-dip galvanizing lines - HDG-1 at the Lipetsk production site.

The project will boost the line HDG-1 productivity by 30% to 500,000 tonnes per year; and increase Lipetsk site value added manufacturing capacity to produce HDG steel for the construction, automotive, and ‘white goods’ sectors to 1.25 million tonnes.

As a result, NLMK will solidify its position in the HVA rolled steel market, where demand exceeds the capacity of Russian manufacturers and is covered by imports, including from far-abroad countries. NLMK has created a reserve stock of galvanized steel for key consumers in machine building, automotive and ‘white goods’ sectors in order to offset the impact of the reconstruction on the market. The decrease in coated steel output will also be offset by higher CRC supplies.

HDG-1 reconstruction will also result in:

• a 25% reduction in HDG-1 natural gas consumption though using modern burners and furnace control systems;
• a 15% reduction in HDG-1 electric energy consumption through optimizing equipment configuration;
• a 30% reduction in HDG-1 air emissions through optimizing the natural gas afterburning system (the gas being used to fuel the furnace) Investment in the project will total approximately 2 billion rubles; with a payback period of 2 years.

Ilya Gushchin, NLMK Vice President for Sales, said: “NLMK is one of the leaders in high-quality coated steel production in Russia. The new project will strengthen NLMK Group’s position in key markets and increase the share of HVA products in our sales. Construction of HDG-5 at Novolipetsk will serve the same purpose. It will expand our production capacities in the most complex HDG segment: sheets less than 0.4 mm thick. The launch of HDG-5 in 2017 will increase NLMK’s HDG capacity by 450,000 tonnes to 1.7 million tonnes.”

NLMK is the leading producer of hot-dip galvanized steel in Russia with over 21% market share in domestic production. There are currently four continuous hot-dip galvanizing (HDG) lines in operation at the Lipetsk site with a total capacity of over 1.1 million tonnes. This equipment supports the production of strip with a width of up to 1800 mm and thickness ranging from 0.4 mm to 4 mm.

Hot-dip galvanized steel is used to manufacture roll-formed shapes, steel structures for construction and components for automotive and ‘white goods’.