Ukrainian iron & steel industry needs unblocking of seaports

Since the beginning of the war Ukrainian seaports have been closed due to mine danger, as well as because of the threat from the Black Sea Fleet of the Russian Federation. As for now, only Danube ports continue to operate in Ukraine, but these ports have relatively small capacities and cannot solve existing logistical problems.

Ukrainian iron & steel companies-exporters had to redirect cargo flows to EU seaports, in particularly in Romania (Constanta), Bulgaria (Burgas), Poland (Gdynia, Gdansk, Szczecin, Swinoujscie), Croatia (Rijeka, Ploce), Germany (Hamburg, Bremerhaven, Bremen). As a result, average distance to dispatch port for Ukrainian exporters increased by five times and shipping costs to port of destination raised by 3-4 times in average.

Blocked seaports lead to significant exports losses in iron & steel industry of Ukraine. According to recent study of GMK Center, monthly value of such losses reaches $420 mln. Monthly Ukraine could not produce and export 1.3 mln tons of iron ore, 151 ths tons of pig iron, 192 ths tons of semi-finished products and 218 ths tons of finished steel products.

EU seaports do not have free capacities to handle all Ukrainian cargo, that is why railcars stay in queue at Ukraine-EU borders. Even during the war 60% of iron & steel products from Ukraine is shipped to end customers by sea. So rising output and utilization of Ukrainian iron & steel companies, restart idled facilities, growth of exports are possible only with unblocking of Ukrainian Black Sea seaports.

Source: www.gmk.center