Fitch: Commonwealth steel rebounding

Fitch ratings said that it expects the Commonwealth of Independent States steel-producing sector to show a slow rebound in 2010.

The agency said it will continue to monitor six key industry drivers, which are likely to influence its ratings for the states' steel producers in 2010, namely the split of export and domestic sales, capacity utilization, changes in product mix, level and speed of deleveraging and exchange rate impacts.

Due to domestic economic growth, most Russian steel companies were selling 60% to 70% of their output to the domestic market by the summer of 2008, Fitch said.

However, domestic demand for steel products dropped by 30% to 50% during the fourth quarter of 2008 and first quarter of 2009, forcing companies to shift sales to export markets such as China, Middle East and Asia, the agency said.

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