RUMANIA PLANS A SHARP INCREASE IN STEEL PRODUCTION DURING 1960-70

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T01003A000900380001-0
• Release Decision: RIPPUB
• Original Classification: C
• Document Page Count: 4
• Document Creation Date: December 12, 2016
• Document Release Date: March 11, 2002
• Sequence Number: 1
• Publication Date: July 6, 1960
• Content Type: BRIEF

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CIA/RR CB 60-38 CONFIDENTIAL Copy No. 2 9
6 July 1960
C
CURRENT SUPPORT BRIEF
RUMANIA PLANS A SHARP INCREASE IN STEEL PRODUCTION DURING 1960-70
OFFICE OF RESEARCH AND REPORTS
CENTRAL INTELLIGENCE AGENCY
This report represents the immediate views of the
originating intelligence components of the Office
of Research and Reports. Comments are solicited.
This document contains information affecting the national defense of
the United States, within the meaning of the espionage laws, Title 18
USC, Sections 793 and 794, the transmission or revelation of which
in any manner to an unauthorized person is prohibited by law.
CONFIDENTIAL,
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CONFIDENTIAL
RUMANIA.PLANS A SHARP INCREASE IN .STEEL PRODUCTION. DURING 1960-70
Rumania has recently announced plans for the most rapid expansion
of steel production among the European Satellites, during the 1960-70
decade. If successful Rumania would follow Czechoslovakia and Poland
.as the third largest steel producer in the Satellites. Probably in-
fluenced by an impressive 52 percent increase in their steel output in
.1959, when over 1.4 million tons were produced, the Rumanians plan.to
produce 3.3 million tons for 1965 and 7.5 million tons by 1970. 1/
Achievement.of the latter goal will require an average annual rate of
increase exceeding 16 percent during 1960-70 compared to the average
rate of 13.5 percent attained during 1949-59. This trend of steel
production contrasts with that of the Satellite countries as a unit
since production during the decade is expected to increase at a some-
what reduced rate.
The paramount industrial objective of the Rumanian Six Year Plan
(1960-65) is the construction of.a new integrated steel plant with an
annual capacity of 4.0 million tons. This plant--to be larger than
any other steel plant existing or contemplated through 1975 in the
Satellites--will be located on the Danube River at Galati where small
rolling mills and a sorting station for imported iron ore currently
are in operation. Although the new plant is to supply the preponderant
portion of the nation's increase in iron and steel output by 1970, it
will at best produce only small amounts in 1965 when its initial opera-
tion.is scheduled. Rumania, therefore, will depend largely on addi-
tions to existing plants for the increase in production of iron and
steel industry commodities to the 1965 levels. These goals are as
follows:
Production
Planned Average
Annual Rate of
(Thousands of Metric Tons)
Increase From
Product
1959
1965
1959 to 1965
Metallurgical coke
609
.1,600
17.5
Iron ore
1,064
4,000
24.7
Pig iron
846
2,000
15.4
Crude steel
1,419
3,300
15.1
Rolled Steel
755
2,000
17.6
Pipe*
* In addition to
274
rolled
steel.
500
10.5
Included in the 1960:-65-Rumanian plan are new 700 cubic meter
blast furnaces and improvements in existing furnaces at the two princi
pal steel plants located in Hunedoara and Resita. These additions are
to more than double the 1959 national output of pig iron. For steel-
making, three new 400-ton open hearth furnaces at Hunedoara, new elec-
tric furnaces at a number of plants, and measures to improve efficiency
throughout the industry are scheduled. Existing rolling capacity is to
be more effectively used and adapted to the production of new types. of
steel sections. The major increase in rolled steel production, however,
is to come from 1.0 million tons of new capacity which is to be added
to the Hunddoara installation. The nation's first welded pipe mills
and an additional seamless pipe mill also are to be built to contribute
to the expected increase in pipe production.
6 July 1960 CIA/RR CB 60-38
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A weakness in the rather ambitious program to increase steel
production may lie in the construction performance of Rumania. Sig-
nificant lags in the building of steel plant facilities have impeded
past production scheduled. It seems probable that a project the size
of.tie new Galati plant may also encounter obstacles of supervision
and delayed deliveries of equipment. 2/
The program for expansion of steel production may be further
impeded by Rumania's inadequate raw material base. Domestic produc-
tion, of metallurgical coke including that coming from 650,000 tons
of new capacity still to be built, is to supply 70 percent of Rumania's
requirement in 1965. However, despite an effort to use more of the
low-grade domestic coking coal, Rumania probably will have to depend
increasingly on the.other Soviet Bloc countries for supplies of coking
coal, Perhaps more serious is the uncertainty of future iron ore
supplies--especially in view of the statements by the USSR that ore
shipments to the Satellites may not be increased after 1965. Rumania,
which now imports nearly half of its required iron ore in terms of
.iron content, plans to become less dependent on imports by 1965 by
increasing iron ore production over one and one-half times. more rapidly
than pig iron production. If the rate of production implied in the
1965 plan prevails, domestic economically exploitable iron ore reserves
--estimated to be about 30 million tons--would approach exhaustion
before 1970. In recognition of this, Rumania is counting heavily on,
exploiting low-grade reserves which have been of little economic in-
terest because of difficult mining conditions A characteristic low-
grade deposit is located near,Constanta in the Dobrogea region where
geological research is first to be concentrated and where proved re-
serves areon the order of only several million tons of ore averaging
20 percent iron content. 3/ Recent optimistic. claims by the Rumanians,
however, indicate that this deposit may contain "hundreds of millions
of tons of.iron ore." 4/ Even if reserves approaching this magnitude
are proved, the Rumanians Probably would have great difficulty in fi-
nancing and constructing ample ore production and benefication facili-
ties on time. A better solution may well exist in working with the
Satellites as a unit to expand imports of iron ore from underdeveloped
countries and thus help to promote economic penetration.
Although the Rumanians may not fully achieve the level of produc-
tion planned for 1970, a notable advance in their position as a steel
producer among the European Satellites is predicted. Rumanian per
capita production of steel is now well below the average of the Sate-
llite countries, but fulfillment of the 1970 production goal would
increase their per capita output to 364 kg or to slightly above the
European Satellite average estimated for that year. In view of the
ambitious industrial program of Rumania, however, the nation may
continue as a deficit steel producer, relying principally on other
CEM.A members to make up any deficiencies in rolled steel.
6 July 1960 CIA/RR CB 69-38
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