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. Last Updated: 07/27/2016

Business in Brief

Severstal Deposits $5.8Bln

Steel major Severstal will deposit $5.8 billion in a state-controlled bank, the firm said Thursday, puzzling analysts as to where it could have gotten the money and what it would do with the cash.

Severstal said in a regulatory filing its board had decided to deposit 150 billion rubles ($5.83 billion) in PromStroiBank at interest of no less than 3 percent per year.

Some analysts said Severstal's move could be meant to build a war chest for an acquisition, although they were puzzled where it got the money after it posted a net profit of only $1.18 billion in 2006. (Reuters)

Inflation Seen on Target

Russia will hit its 8 percent inflation target in 2007 despite sharp growth in money supply caused by private capital inflows, Central Bank head Sergei Ignatyev said Thursday.

"In the next few months, money supply growth will most likely slow down and will be in line with our forecast," Ignatyev told President Vladimir Putin, RIA-Novosti reported. "I therefore believe that the realization of our goal -- 8 percent inflation in 2007 -- is achievable."

Money supply grew by 41.6 percent in 2006 and the Central Bank expects it to grow 32 percent to 34 percent this year, compared with current rates of over 50 percent. (Reuters)

Cattle Numbers Lower

Russian cattle numbers were down slightly compared with one year earlier at the start of April, but were higher since the start of the year, official data showed Thursday.

That was despite a government plan, announced in 2005, to invest more than $500 million in animal breeding in 2006 and 2007 and involving the purchase of 100,000 pedigree animals to lease to farmers. The Agriculture Ministry also declared 2006 the Year of the Cow.

As of April 1, cattle numbers were 0.2 percent down year on year at 22.2 million head. (Reuters)

Russia Sows Spring Grains

Russia had sown some 7 million hectares with spring grains by May 2, 22.3 percent of the area to be sown this year, and 1.6 million more than a year ago due to early spring, the Agriculture Ministry said Thursday.

The area sown to maize was 603,500 hectares as of May 2, which is 187,500 hectares more than by the same date last year, the ministry said. Russia plans to harvest 76 million to 79 million tons of grain this year, compared with 78.6 million reaped in 2006, although analysts said the crop might be larger. (Reuters)

Alcohol Pricing Decision

Mandatory minimum retail prices for hard alcohol may be introduced later than 2008, as previously planned, a Finance Ministry official said Thursday, Interfax reported.

The decision was made after a government meeting last month, when it was concluded that a survey was required to monitor the sales of cheap alcohol in 2006, the official said.

Analysis of research into the market share of cheap alcohol products will be used to decide whether to implement the proposal in 2008 or later, Interfax reported. (MT)

Diamond Sales Planned

The State Precious Metals and Gems Depository of the Finance Ministry, or Gokhran, intends to sell diamonds and precious stones to the value of 42.35 billion rubles ($1.65 billion) from 2008 to 2010, under the draft budget for 2008-2010, Prime-Tass reported Thursday.

The government submitted a draft of the three-year federal budget to the State Duma on Monday.

Gokhran may also buy diamonds and stones worth about 34.35 billion rubles over the same period, the agency reported. (MT)

Putin Urges Ship Reforms

Greater efforts should be made to discourage Russian ship owners from registering their shipments under flags of convenience, President Vladimir Putin said at a joint meeting of the presidium of the State Council and the naval board in Murmansk on Wednesday.

Putin said the country currently operates more than 1,500 ships.

"But 60.3 percent of this tonnage is transported under foreign flags that are convenient for Russian ship owners, and this number keeps getting bigger," Putin said, according to a transcript of the speech on the Kremlin's web site. (MT)

Caspian Pipeline Discussed

ASHGABAT, Turkmenistan -- Turkmenistan and Kazakhstan have discussed building a natural gas pipeline and railway along the Caspian Sea coast to improve transport and provide more infrastructure for future gas exports, Turkmen state media said.

Turkmenistan's state-controlled television said the projects were discussed Wednesday during a visit by Kazakh Prime Minister Karim Masimov.

"We discussed questions of transporting gas," Masimov said in comments shown on television on Thursday after his meeting with Turkmen President Gurbanguly Berdymukhammedov. (Reuters)