You're reading: Pinchuk hopes pipe supply to Customs Union will grow

Dnipropetrovsk, Oct 27 (Interfax-Ukraine) – The owner of the Interpipe Pipe and Wheel Company (Dnipropetrovsk) Victor Pinchuk has expressed hope that the agreement on a free trade zone with the CIS signed by the government will boost pipe and wheel supplies to the Customs Union's markets – Russia, Kazakhstan and Belarus.

"The prime minister said that the agreement on free trade would significantly relax access of pipes and wheels to the markets of the Customs Union. Mykola Yanovych [Azarov, Ukraine’s premier] said that under the agreement there would not be exemptions for pipe products," Pinchuk said, commenting on the results of a visit of the Ukrainian premier to the Dniprostal arc-furnace melting complex on Tuesday.

The owner of the Interpipe said that this is good news for the company. He said that the agreement should be ratified by national parliaments.

Pinchuk also said that the launch of Dniprostal is scheduled for March 2012. Equipment testing will start in December. Investment in the construction of the plant came to over $700 million.

He said that around 550 workers would work at the plant, at which wages are to be 10% higher than the average wage in the sector.

Pinchuk added that the whole infrastructure of the company is intended for large production facilities.

Analyzing the situation on the international markets, the company’s leadership will decide on the construction of a second stage of the plant. It will take around one year to build the second stage.

On Oct. 18, 2011 Azarov signed a CIS free trade zone agreement in St. Petersburg. It is expected that the countries will ratify the agreement by the end of this year, and it will take effect from January 1, 2012.

Dnirpostal electric smelter is a key project for Interpipe aimed at providing pipe and wheel production facilities with their own steel casting.

The capacity of the new plant will be 1.32 million tonnes per year, which will make it the largest company in Eastern Europe.

Interpipe is one of the world’s ten biggest pipe producers and its third biggest rail carriage wheel producer. It exports products to over 80 countries.

In 2010, the company’s enterprises produced around one million tonnes of pipe and wheel products. Its revenues for that year came to $1.3 billion.