Russia economic meltdown as steel giant profits plunge 89% & airlines face total collapse | World | News
While Russia’s largest steel manufacturer MMK continued to fight under the economic war and sanctions, his profit collapsed in the first half of 2025. Magnitogorsk iron and steel work describes itself as one of the largest steel manufacturers in the world with a production volume of approximately 12 million tons.
The latest data shows that the company has earned nine times less in the first six months of this year compared to the same time period in 2024. In the first half of the year, income fell to 25% due to a decrease in sales and sales prices. This had a disaster effect on the profits of the company, which decreased by 88.8% of 5.6 billion rubles (£ 52.5 million) annually.
MMK’s management, as the demand for its products dried, warned that the job does not expect to take it at any time.
“The demand for metal products is expected to be under pressure in the third quarter of 2025 due to the negative impact of the high key (interest) ratio on business activity,” he said.
Russian enterprises and consumers were shot by double -shaken inflation and high interest rates. Inflation stubbornly 9%, while the Central Bank of Russia was forced to increase the basic interest to the highest level of two decades to 21%.
In June, the ratio of bank officials was able to reduce the rate to 1 percent to 20% – the first deduction in three years. However, it is unlikely that the rate deduction will provide too much relaxation for both enterprises and consumers.
Last year, Russian metallurgists faced a decrease in demand from local consumers and a decrease in the use of facilities due to an increase in key interest rate rate.
Steel consumption in Russia fell by 6% in 2024, and this year, industrial lobby expects a decrease of 10% in demand.
Ukraine’s foreign intelligence service comes because it predicts that commercial airlines in Russia may face total collapse at an early date like 2027.
As a result of sanctions, maintenance costs increased by 38%and half of the Airbus fleet in Russia is no longer used. In addition, new aircraft, not even out of the test, increased by 45-70% at prices compared to original pricing plans.
Russia is estimated to lose 50 to 100 planes each year, and until 2027, the industry may face a complete aviation collapse.
