russia’s Economy Is Cooling Down

russia’s metallurgical industry is gradually declining due to export restrictions, high key rates, and competition from Chinese manufacturers saturating the market with cheap products. This economic slowdown is already forcing the biggest players to curtail their investment programs. “United Metallurgical Company” has given up a 70 billion rubles project to produce seamless pipes in Tatarstan and terminated an agreement to protect capital investments.

“Tehstroy” LLC, which controls 15 % of the polymer pipe market, has cut production by 40 % in several regions, while the tax authorities have charged it additional 730 million rubles in taxes. In Tatarstan, the production of plastic pipes halved in the first nine months of 2025, to 34,400 tons, compared to 68,500 tons a year earlier. The company, which once supplied products to Gazprom and large sports projects, is now unable to pay even 2 million rubles of debt to contractors.

The Kazan Pipe Plant, which specializes in water pipes, has reduced production by 30 % due to cuts in housing and utilities funding and high interest rates. The company, which in better times had revenues of 1 billion rubles and produced up to 12,000 tons of products per year, is now forced to cut staff, warehouse space, and non-core expenses. The owner personally has headed the company, which even terminated its membership in the industry association due to a lack of funds.

The main reasons for the crisis are said to be the falling demand in the gas and oil sectors, cuts in housing and utilities funding, unprofitable exports, and dumping by Chinese competitors. But all this is a consequence of the kremlin’s policy of directing budget resources not to support industry, but to finance the war against Ukraine.