Baku, Azerbaijan, Dec. 18
By Emin Aliyev - Trend:
International ratings agency Fitch says its 2014 sector outlook for Commonwealth of Independent States (CIS) steel and steel raw materials is Negative.
The agency believes that producers in the CIS are currently facing pressure on their credit metrics due to their exposure to a decelerating Russian market, still fragile European markets and a recovering (but still weak) U.S. market.
"However, this market pressure is compensated to an extent by inherent advantages like vertical integration into raw materials, cost competitiveness and pro-cyclical rouble leaving CIS players among the most profitable steel companies globally," according to the agency's report.
Higher-than-expected domestic market performance driven by its long-term growth potential, or a faster recovery in European markets helped by the closure of its less efficient capacities and better market balance could result in a revision of the outlook to stable, Fitch said.