Market participants are sounding the alarm: there is a lot of capacity, but not enough raw materials. The issue with secondary raw materials is especially acute – electronic scrap, which almost never ends up in factories.
There are 11 officially operating refining enterprises in Russia, but the lion’s share – more than 90% – is provided by the three largest. On average, the load on the industry is only 30–35%. Margins are falling and struggle for every kilogram of gold growing.
At the same time, gold production in the country grows annually by only 1–2%. This is clearly not enough to load existing capacities. There is much more potential in recycling, but everything is sad here. In Russia, about 140 thousand tons of electronic circuit boards containing precious metals are produced annually. However, no more than 10–15% of this volume is collected and sent for refining. The rest goes to waste or ends up in illegal circulation.
The paradox of the situation is that the government, despite the surplus capacity, plans to build a new refinery in the Khabarovsk Territory. Market participants propose to first load existing enterprises.
A number of other systemic problems were also raised at the round table at the Chamber of Commerce and Industry. Firstly, the transition to recycled materials requires investment and new technologies. Recycling will be unprofitable if all non-ferrous metals are not recovered.
Secondly, Russian refinery companies are completely cut off from the global market. Import is very difficult, and export of finished products is difficult due to problems with obtaining licenses. This reduces competitiveness and makes it difficult to attract financing.
Thirdly, there is a catastrophic lack of investment in geological exploration. According to market participants, in 20–30 years the industry may face a real shortage of mineral raw materials if we do not start searching for new deposits now.
Finally, the share of refractory (hard-to-extract) ores is constantly growing. Russia has an acute shortage of modern enrichment plants capable of processing such raw materials.
The meeting participants came to the conclusion: the Development Strategy for the Precious Metals Industry being developed by the Ministry of Industry and Trade should include specific measures to support the refining sector. These include access to imported raw materials, incentives geological exploration, building factories for processing refractory ores and putting things in order with the collection of electronic scrap. Without these steps, the industry risks withering away with an excess of beautiful but empty workshops.
Source: Kommersant
Image: Sergey Chivikov
