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. Last Updated: 07/27/2016

Business in Brief

Cabinet Caps Tariffs

MOSCOW (Reuters) -- The Cabinet approved on Thursday price caps for electricity, gas and cargo railway transportation for next year, but failed to set an exact date when they would come into force, a government official said.

Finance Minister Alexei Kudrin told reporters that the Cabinet approved a 13 percent price limit for national power utility Unified Energy Systems, a 20 percent hike for gas giant Gazprom and a 12 percent rise for the Railways Ministry.

"Work will be continued. … Natural monopolies should stop being an inflation generator," Kudrin said, when asked when the new prices would come into force. "It will not happen from Jan. 1," he said.

Along with a strong inflow of hard currency from energy exports that the Central Bank has to cover by printing new rubles, rising prices for the natural monopolies -- Gazprom, UES and the railways -- are the top contributors to consumer price inflation.

According to the Economic Development and Trade Ministry, the price hikes would contribute 3.1 to 3.4 percentage points to Russia's inflation, set at 8 percent to 10 percent for 2004.

But a government spokesman quoted Kudrin as saying he doubted that the price rises would only increase inflation by 3 percent.

Speculation 'Rubbish'

MOSCOW (MT) -- British platinum producer Lonmin PLC on Thursday denied market speculation that it was the target of a takeover bid by mining giant Norilsk Nickel.

A Lonmin spokesman was quoted by Dow Jones as calling the speculation "rubbish," and noted that similar reports had been circulating for some time.

Market observers disagree over whether Lonmin -- the world's third-largest producer of platinum group metals -- would be a natural fit with Norilsk.

Dow Jones quoted one London-based analyst as saying Thursday that Norilsk is unlikely to have enough cash to make a credible offer for Lonmin. Lonmin shareholders, the analyst added, would be unlikely to accept an offer dominated by Norilsk shares.

Russian Crude to U.S.

WASHINGTON (Reuters) -- U.S. crude imports from Russia hit an all-time high of 424,000 barrels per day in June, as companies bought Russian oil as a replacement for the Iraqi crude that has mostly been off the market since the U.S. occupation of Iraq.

Based on preliminary data from importing companies, total U.S. imports were 9.9 million bpd in June, a record for the month and the fourth highest ever, the Energy Information Administration said this week.

36.6, VTB Team Up

MOSCOW (MT) -- Pharmacy chain 36.6 and Vneshtorgbank on Thursday announced the signing of a strategic partnership agreement, Dow Jones reported Thursday.

Under the agreement, 36.6 and Vneshtorgbank will cooperate on projects including banking services, credit provision, a possible debt capital market transaction, financing investment projects for 36.6 and consulting services. In June and July of this year, Vneshtorgbank provided 36.6 with two credits worth a total of $7 million.

$47M Loan for Sibir

MOSCOW (MT) -- State-owned Sberbank has granted a credit line of 1.43 billion rubles ($47 million) to the country's second-largest airline, Sibir, Vedomosti reported Thursday.

Each loan under the credit will be up to 18 months in maturity, with an annual interest rate of no more than 17 percent, the paper said.

Sberbank has been working on diversifying its loan portfolio in the last several months after it was criticized for crediting only a handful of oligarch-controlled companies.

Ferro-Alloy Deal Seen

NOVOSIBIRSK, Western Siberia (Reuters) -- The country's top ferro-alloys producer, Chelyabinsk Electrometallurgical Combine, or ChEMK, will buy the country's No. 2 firm, the Kuznetsk Ferro-Alloys Plant, next week, Kuznetsk said Thursday.

"The deal will be completed within the next three or four working days," a Kuznetsk spokesman said.

The Kuznetsk plant, in the Siberian town of Novokuznetsk, is 95 percent owned by the MDM Financial Group.

For the Record

Gold and foreign exchange reserves rose to $64.6 billion as of Aug. 8 from $64.4 billion on Aug. 1, the Central Bank said Thursday. (Reuters)

The Safyanovskaya Med copper ore plant produced 18,011 metric tons of copper in ore in the first seven months of 2003, a 7.4 percent rise from the same period in 2002, Urals Mining and Metals said Thursday. (Reuters)

Leading juice and dairy company Wimm-Bill-Dann said Thursday its first half dairy, juice and water sales were up 12.4 percent to 773,600 metric tons compared with the same period in 2002. (Reuters)