Kazakhstan is increasing the production of precious metals
The metallurgical industry is one of the leading industries in Kazakhstan, right after the oil and gas industry. There are many deposits of metal ores on the territory of the republic, such as iron, lead, copper, zinc, chromium, gold, aluminium, manganese and others.
The infographic above shows what ores are mined in Kazakhstan and what metals and finished products are then produced from them. Thus, according to the Bureau of National Statistics, Kazakhstan mainly extracts copper ores and concentrates (54.7%), iron (19.7%) and gold ores (14.7%).
Production of industrial metals is declining (-3.5%) due to a decline in iron ore mining, which negatively affected steel production, which accounts for almost 50% of all metal production. In second place are ferroalloys (with a share of 24.3%), aluminum (18.3%) and copper (5.2%). The production of precious metals demonstrates stable growth dynamics, where the production of gold increased by 12.8%, and silver – by 0.6%.
The reason for such multidirectional trends in the metallurgical industry is geopolitical tensions, tightening of monetary measures, lower investment in the industry and rising prices. In our opinion, this directly jeopardized the ferrous metallurgy industry, which was already suffering due to the fall in the supply of ferrous metals, iron ores and concentrates from Kazakhstan to Russia (the main buyer of these goods). At the same time, metals such as lead, zinc and copper are export-oriented, and only a small part of them is processed domestically, which also creates risks of dependence on external conditions.
In our previous work on the industrial sector , we have already noted that the current global situation is forcing Kazakhstan to look for new ways of development and markets for its goods, as well as the need to develop the manufacturing industry. At the same time, the situation in the metallurgical industry remains ambiguous. Kazakh producers complain about the unavailability of raw materials and the lack of conditions for the development of the manufacturing industry, despite existing agreements to provide them with raw materials at a price below the market.
Under these conditions, the government of the Republic of Kazakhstan has recently begun to consider the issue of introducing an obligation for producers of raw materials to provide them with domestic manufacturing enterprises by 2026, since, according to the Ministry of Industry and Infrastructure Development, the workload of domestic processors of key metals (aluminum, copper, lead and steel) in most does not exceed 50%.
We believe that the adoption of such a commitment should have a positive impact on the development of the steel industry in Kazakhstan and is a good step towards ensuring stable economic growth.
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