Russia's steel production fell to its lowest level in 15 years in 2025, as Western sanctions, weak domestic demand and high borrowing costs pushed one of the country's largest industrial sectors into its deepest downturn since the early 2000s, industry data showed.
Steel output declined to 67 million metric tons last year, down 12% from pre-war 2021 levels, according to data from industry association Chermet cited by the RBC news website.
The downturn accelerated in the first quarter of 2026, with steel production falling 10.4% year-on-year to 15.6 million tons despite continued demand from defense manufacturers.
The decline highlights the growing strains facing parts of Russia's wartime economy beyond the defense sector. While military spending has supported some industries, steelmakers have been hit by a combination of shrinking demand from key domestic customers, the loss of Western export markets and interest rates that have made financing increasingly expensive.
"The metal market is under pressure from two key factors," Alexei Parshukov, senior vice president at Industrial Metallurgical Holding (PMH), told RBC.
