Baku Steel Restarting Steel Mill

Baku Steel Company, Azerbaijan's only producer of reinforcement steel, announced that it will restart production Feb. 1.

Paolo Perviz, Baku’s largest shareholder, said that the company shut down production Jan. 17 due to a lack of raw materials.

"We have now shut down all plant equipment," company spokesman Namig Akhmedov told Interfax.

But Perviz said "We only stopped production for two weeks, and the plant will restart on February 1. In the meantime, we intend to stock up on scrap metal and prepare to go back into production," he said.

"We've melted 1 million metric tons of scrap metal in the three years since we started business. We've bought scrap from members of the public and from companies. But households have run out and state enterprises now have 90 percent of the scrap. We need to go through a lot of red tape in order to obtain this," Perviz said.

According to Interfax, the plant's main scrap metal suppliers are Azerenergy, the Caspian Shipping Co. and private individuals. The company requires 1,000 metric tons of raw material a day to be fully operational.

Heydar Babayev, Azerbaijan's economic development minister, acknowledged that the plant has had a difficult time with locking up raw materials. "One of BSC's problems is high prices for scrap and metal but, given the competitive environment and market economy conditions, it would be wrong for the state to interfere in this process. I don't think it would be right to raise this issue at government level," he added.

The company has capacity to produce 350,000 metric tons of reinforcement steel and semi-manufactures annually.

 Paolo Perviz said that BSC intended to raise output 25 percent this year. "Output was 330,000 metric tons last year, and this year we are aiming for at least 400,000 metric tons. We were producing just 125,000 metric tons per year when we started out," Perviz said. Interfax