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Modernization of pharmaceutical industry and production of protective products: How Kazakhstani enterprises developed during emergency state

Monday, 25 May 2020, 22:33:31

The coronavirus pandemic can lead to a protracted economic crisis. Entire sectors of the economy have collapsed around the world. More than 400 million enterprises were on the verge of bankruptcy. Experts predict the largest contraction in the global economy in the century. Against this background, Kazakhstan managed to maintain positive production volumes in almost all regions of the country.

In January-April 2020, industrial production amounted to 105.9% (against the plan of 97.1%), including: mining 106% against the plan 95.5%, processing 107% against the plan 98.9%.

Positive volumes of industrial production persist in 16 regions.

In the mining sector, iron ore production increased by 15.8% (122.2%) against a plan of 99.1%. The output of non-ferrous metal ores increased by 3.4% against a plan of 99.2%.

Growth recorded:

  • at Kazakhmys Corporation LLP, ore production by 4% (from 9,488 thousand tons to 9,825 thousand tons);
  • at Bakyrchik Mining Enterprise LLP gold-containing ore by 1% (from 683 thousand tons to 689 thousand tons);
  • at JSC AK Altynalmas gold-containing ore by 26% (from 699 thousand tons to 878 thousand tons);
  • at RG Gold LLP, gold ore mining volumes by 41% (from 350 thousand tons to 493 thousand tons);

In January 2020, the Aktogay project, located in the Karaganda region, showed a planned increase in gold ore mining by 26%. This is due to the fact that in the second half of 2019, the company took measures to optimize open pit mining and equipping the technological equipment of the Aktogay gold recovery plant grinding mill, which allowed to increase the productivity of the production complex from 2.3 million / ton to 2.5 million / tons.

The volume of coal and lignite production (excluding coal concentrate) increased by 2.1% (102.1%) with a plan of 98%.

For reference: Growth was achieved due to an increase in coal production by:

  • ArcelorMittal Temirtau JSC by 15% (from 2 952 thousand tons to 3,404 thousand tons);
  • Vostochny ERG mine by 11.4% (from 5,398.5 thousand tons to 6,015.6 thousand tons);
  • Bogatyr Komir LLP by 2% (from 15 897.7 thousand tons to 16,226.4 thousand tons);
  • Maykuben-West LLP by 17% (from 1,378.4 thousand tons to 1,611.8 thousand tons);
  • Karazhyra LTD LLP by 1.7% (from 2 106.5 thousand tons to 2,142.3 thousand tons).

Despite the pandemic, ERG JSC is working stably, in the usual mode. Production plans are being implemented. This was largely achieved by the preventive action plan developed to prevent the spread of the virus in ERG enterprises. In addition, the other day, the Vostochny open pit shipped the billionth anniversary cubic meter of rock mined during the 35 years of operation of the coal enterprise.

ERG is one of the largest suppliers of electricity and coal in Kazakhstan. The enterprise accounts for more than 17% of all generated electricity and about 20% of coal mined. The company combines two structural divisions: Vostochny coal mine and Aksu power station. The main areas of production: coal mining and electricity generation.

The Vostochny open pit mine is the first coal enterprise in the world to use a unique in-line technology with conveyor transport when tilting bedding. The presence of averaging warehouses, where the quality of coal mined from different faces is averaged, is also a hallmark of the enterprise.

At the first stage, a fully in-line technology of coal mining with averaging and dosing was introduced, the directions and parameters of the extension of transport communications were effectively determined. The technology of cutting new horizons with SRs (K) -2000 rotary excavators was tested and implemented, the technology of open drainage of mining operations was introduced.

During the privatization period, a railway communications system was built, which allowed for the opening of coal from the Vostochny independent mine. A significant event in the development of the section, of course, is the introduction in 2010 of cyclic-continuous overburden technology with decisions taken to increase productivity.

In 2018, coal mining was launched from the promising Vostochny-2 section. This decision made it possible to reduce the rate of opening of Vostochny-1 and to continue shipping the averaged coal to consumers.

At the same time, a decrease in coal production at Shubarkol Komir JSC was allowed by 6.5% (from 3,279 thousand tons to 3,065 thousand tons).

Coal mining companies produced 37.1 million tons of coal in January - April 2020, which is 0.5% more than in the corresponding period last year (36.9 million tons).

In the manufacturing industry, there has been an increase in ferrous metallurgy by 0.1%, non-ferrous metallurgy by 8%, engineering by 25.4%, light industry by 13.9%, pharmaceutical industry by 24.2%, and the chemical industry by 0.3% , the production of building materials by 15.6%.

In metallurgy, production increased by 5.4% (plan – 97.6%). In ferrous metallurgy, the growth in production amounted to 0.1% (plan – 97.6%).

For reference: Production growth has been achieved:

  • ArcellorMittal Temirtau JSC became 4% steel (from 936.5 thousand tons to 970.9 thousand tons);
  • Euraz Caspian Steel LLP reinforcing bar 36% (from 83.2 thousand tons to 113.0 thousand tons);
  • Casting LLP of commodity production of reinforcement, balls and round timber by 3.2% (from 25.6 thousand tons to 26.5 thousand tons);
  • KSP Steel LLP of carbon steel by 1.2% (from 74.9 thousand tons to 75.8 thousand tons).

In connection with the spread of the coronavirus pandemic both in the country and in other countries of the world, as well as the current situation on the metal market and the redistribution of export potential, ArcelorMittal Temirtau JSC and the ERG Group of Companies are considering alternative markets to ensure production stabilization and continuous implementation manufactured products.

ArcelorMittal Temirtau JSC plans to export 42 thousand tons of hot rolled steel in the direction of China; cold rolled steel – 1 thousand tons; steel semi-finished product (billets) – 37 thousand tons.

TNK Kazchrome JSC is at risk of sending ~ 26 thousand tons of ferrochrome to Europe and the sale of this cargo to China is being considered as an option.

In non-ferrous metallurgy, the growth in production amounted to 8% (plan – 97.6%).

For reference: At Kazakhmys Corporation LLP:

  • refined copper by 17% (from 78,224 tons to 91,635 tons);
  • 3% copper wire rod (from 1,960 tons to 2,025 tons);
  • 15% gold bullion (from 1,497 kg to 1,719 kg)
  • silver in granules by 22% (from 72,938 kg to 89,007 kg);

at LLP Kazzinc, zinc metal at 0.5% (from 104 314 tons to 104 492 tons);

at Casting LLP

  • 135% copper wire (from 111 tons to 261 tons);
  • 20% brass alloys (from 367 tons to 441 tons);

on Aluminum of Kazakhstan JSC, aluminum by 2% (from 439 thousand tons to 446.9 thousand tons);

18% refined gold at Tau-Ken Altyn LLP (from 7.63 tons to 9 tons);

at Kazakhstan Electrolysis Plant JSC of primary aluminum by 2% (from 86 thousand tons to 87.8 thousand tons);

at JSC UKTMK:

  • sponge titanium by 9%;
  • titanium alloys and ingots by 116%;
  • magnesium marketable by 4%.

at Kounrad Copper Company LLP, cathode copper by 1% (from 4,121 tons to 4,183 tons).

In addition, the volume of production in the pharmaceutical industry grew by 24.2% (plan – 102.1%).

For reference:

  • at JSC Nobel AFF (10% share in the industry) an increase in production volumes by 20% (from 18,824 kg to 22,591 kg);
  • at Karaganda Pharmaceutical Complex LLP, an increase in production volumes by 14 times (from 1,361 to 19,151);

Karaganda Pharmaceutical Complex LLP is the first domestic innovative biotechnological pharmaceutical complex equipped with the latest technological equipment, production workshops are designed and built taking into account the requirements of good manufacturing practice in accordance with international standards.

As a result of the transfer of production technology, it was possible to localize the production of biotechnological drugs for the treatment of socially significant diseases such as hemophilia, oncology, viral hepatitis, diabetes mellitus, etc., which were not previously produced in the Republic of Kazakhstan.

Also in this year new drugs of our own production are produced and supplied: INN Interferon beta 1b (TN Interbetin) for the treatment of multiple sclerosis, Alteplaz (Revecard) for the dissolution of a blood clot in myocardial infarction and Bevacizumab 100 and 400 mg for the treatment of colorectal cancer.

The withdrawal of new drugs allowed in the 1st quarter of 2020, double the production figures of the Karaganda pharmaceutical complex.

The localization of domestic biotechnological medicines reduced the cost of production from 10 to 30% compared with the prices of imported medicines, which allowed the Ministry of Health of the Republic of Kazakhstan to save budget funds worth more than 1 billion tenge and thereby increase the population's access to expensive and vital medicines.

Currently, under the state of emergency in the country, the Karaganda pharmaceutical complex continues its production activities, while strengthening quarantine measures and sanitary standards for pharmaceutical production.

In March 2020, the company made an early delivery for the increased additional demand for the drug Semiclotin (to stop bleeding), and also organized the production of Revecard (dissolution of a blood clot during myocardial infarction), the demand for which increased by 10% in annual terms.

The Karaganda pharmaceutical complex continues to develop production of new modern highly effective drugs and plans to enter the markets of foreign countries with its products in the medium term.

In the chemical industry, in January-April 2020, the volume of production amounted to 100.3% against the plan of 99.2%.

Decrease in production volumes:

1) at Kazphosphate LLP (a 31% share in the industry) due to the shutdown of the furnace for overhaul until May 2020.

2) at Aktobe Chrome Compounds Plant JSC (11% in the industry), a reduction in the export of products associated with a decrease in procurement by the main consumers.

3) at JSC Caustic (share in the industry 6%) with a decrease in consumption of products of JSC Caustic by domestic enterprises of the mining and metallurgical complex and oil and gas companies.

At the same time, there is an increase in production at the enterprises of KazAzot JSC (8% share in the industry):

The volume of production of engineering products increased by 25.4% (plan – 99.4%).

For reference: In January-April 2020, compared with the same period in 2019, the production of motor vehicles, trailers andi-trailers, elect semrical equipment, and other vehicles increased.

The production of building materials increased by 15.6% (amounted to 115.6% against the plan of 98.2%) due to an increase in the production of processed stones (192.2%), ceramic bricks (115.0%), and silicate bricks (160.3%), ready-mixed concrete (191.8%), cement (123.3%), insulation materials (112.2%), concrete products (156.2%), gypsum (130.4%).

The overfulfillment of the target indicator is also associated with an increase in construction volumes in the Akmola region by 18.9%, West Kazakhstan region by 11.6%, Karaganda region by 25.5%, Atyrau region by 14.7%, Turkestan by 28.7%.

In the production of furniture, an increase of 6% is noted, in the production of paper and paper products an increase of 16.5% is observed. The volumes of production of corrugated paper and cardboard, toilet paper, hand towels from paper pulp, boxes, boxes and paper bags were increased.

In the production of wood and cork products, except furniture, and the production of straw products and materials for weaving, an increase of 18.3% is observed, which is associated with an increase in the production of timber, windows and wooden doors, wooden containers.

In light industry, production increased by 13.9% (plan - 98.8%) due to an increase in the production of textiles by 13.4%, clothing by 11.3% and leather and related products by 12.4%.

Growth is noted in all sub-sectors due to an increase in the production of cotton fiber, finished textile products, outerwear, footwear, and also due to the launch of Ball Textile LLP projects in 2019.

In general, Kazakhstani manufacturers still retain the defense order and workwear market, which provide manufacturers with guaranteed sales and minimal risk of unclaimed products.

In order to provide the population with protective preventive masks, more than 70 sewing enterprises were involved in production: Dalatex LLP (Kyzylorda), Bolshevichka LLP (Kostanay), Eco-Farm LLP (Shymkent), As LLP Farm (East Kazakhstan oblast), Tynys JSC (Kokshetau), KazLegProm LLP (Almaty), Zhanarys LLP (Mangystau region) and others that produce up to 700 thousand masks from gauze and calico per day.

For example, Kazlegprom Almaty LLP manufactured 250,000 reusable face masks during quarantine; 35,000 masks were sold in Nur-Sultan, 15,000 masks in Aktobe, 15,000 masks in Aktau, Atyrau, and 35,000 masks in Almaty. The balance in the warehouse is 140,000 masks. Humanitarian assistance was also provided to the Maktaaral district in the amount of 10,000 masks.

In the context of the coronavirus pandemic, many enterprises restructured their work, including the Bolshevichka factory. Protective masks began to be produced here, providing the region's needs for protective products.

So, over the period of the emergency and quarantine regime, more than 200 thousand masks were produced, 10 thousand were sewn per shift

According to the director of the enterprise Arsen Zhetpispayev, the factory was provided with the necessary raw materials for this.

The factory has developed several options for protective masks. These are five-layer, eight-layer and eight-layer with cotton. Demand for products is large: these are medical and state institutions, the police. The factory twice took part in the campaign for the free distribution of masks to residents of the city of Kostanay under the name “Biz Birgemiz.” First of all, these products were provided to pensioners and the elderly.

“I had to postpone plans for the production of workwear and clothing in general. At present, we continue to produce mask products, but we are already thinking about the future,” said the head of the enterprise.

For example, on May 26, the first online demonstration of new school uniforms will take place. Transfer to this mode of operation will create an online platform for promoting products. During the epidemic, the world has become even more virtual, which creates new technologies and new opportunities.

It is worth noting that gauze and fabric masks are sold on a contractual basis with local executive bodies and commercial organizations.

In order to provide sewing enterprises with raw materials, Azala Textile LLP launched 9 machines with a capacity of 10 thousand square meters. (running meter) gauze per day.

The production cycle is established in accordance with the interstate standard. The company also produces bleached cotton with a low density (calico, calico).

The ministry has also prepared a Roadmap for the Development of Light Industry for 2019-2021, which is approved by the Government. The roadmap provides for 52 measures to ensure the supply of raw materials to enterprises, the fight against illegal circulation of goods, increasing the share of Kazakhstani content, measures of economic incentives, as well as systemic support measures.

In 2019, state bodies, organizations, and Atameken NCE carried out some work, 80% of the Roadmap events were completed.

For local executive bodies, target indicators have been set for local content in government procurement of light goods, furniture industry and construction materials.

The goods of the light and furniture industry are included in the list of goods, works and services for which public procurement from July 1, 2019 is carried out by a competitive tender with preliminary qualification selection.

A pilot project on mandatory labeling and traceability of shoes has been launched.

As for transport and warehousing, the volume index for January-April 2020 amounted to 89% with a plan of 99%.

Income from transport activities decreased by 2% and amounted to 921 billion tenge (January-April 2019 - 940 billion tenge).

The volume of cargo transportation by all modes of transport decreased by 7.1% and amounted to 1.101 billion tons. Cargo turnover decreased by 2.3% and amounted to 182.2 billion tonne-kilometers (ton-kilometer).

The number of passengers carried decreased by 24.4% and amounted to 5.6 billion people (January-April 2019 – 7.4 billion people). Passenger turnover decreased by 25.9% and amounted to 67.7 billion passenger-kilometers (January-April 2019 – 91.4 billion passenger-kilometers (passenger-kilometer).

For reference: 130.6 million tons were transported by rail and increased by 3.1% compared to the same period last year (January-April 2019 – 126.6 million tons).

Cargo turnover amounted to 94.5 billion ton-kilometers and increased by 3.4% (January-April 2019 – 91.4 billion ton-kilometers).

The volume of goods transported by road decreased by 9.3% compared to the same period last year and amounted to 877.4 million tons. Correspondingly, the freight turnover indicator of road transport decreased by 12.6% compared to the same period last year and amounted to 43.4 billion ton-kilometers.

In terms of pipeline transportation, growth is observed, for this period this indicator amounted to 92.7 million tons, which is 2.2% more than the same period last year. However, freight turnover decreased by 2% and amounted to 44.2 billion tonne-kilometers.

The total volume of container transit traffic in January-April 2020 amounted to 211.6 thousand TEU (twenty-foot equivalent is a conventional unit for measuring the capacity of freight vehicles), which is 22.1 thousand TEU or 12% more than in January-April 2019 years (189.5 thousand TEU).

At the same time, in the direction of China-Europe-China, the volume of container traffic amounted to 117.7 thousand TEUs, which is 23.4 thousand TEUs or 25% more than in January-April 2019 (94.3 thousand TEUs).

Also, quarantine of some enterprises affects transport and logistics, as they reduce the volume of deliveries and orders for transportation.

The index of the physical volume of construction amounted to 105.5%, with a plan of 101.1%.

According to the results of January-April 2020, positive dynamics are observed in 13 regions.

For reference: The leaders are Turkistan (128.7%), Karaganda (125.5%), Akmola (118.9%), Atyrau (114.7%) and West Kazakhstan (111.6%) regions.

According to the results of January-April 2020, 3 112.5 thousand square meters were commissioned for housing construction. meters of housing, which is 89.9% of the same period in 2019. The percentage of housing commissioned by the annual plan was 22.1% (plan 14.1 million square meters).

A total of 24,884 housing units were commissioned in the republic, including 11,498 individual houses.

An increase in housing commissioning compared to last year is observed in 10 regions of the republic.

For reference: investments amounted to 3981.9 billion tenge, which is 17.5% higher than last year's level. The leaders in housing commissioning are Almaty (120%), Zhambyl (112%), East Kazakhstan (105.1%), Karaganda (104.1%) and Kostanay (103.1%) regions.


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