In September 2022, steel enterprises of Ukraine increased the production of rolled products by 2.4% compared to August 2022 – up to 254 thousand tons. Year-on-year production in September 2022 decreased by 82.8%. This is evidenced by the data of the Ukrmetallurgprom.
Pig iron production in September 2022 fell by 7.5% compared to August – to 310 thousand tons. Steel production in September 2022 amounted to 340 thousand tons, which is 7.1% less compared to the previous month. Volumes of rolled products output in September was a record since the beginning of the war.
In January-September 2022, Ukrainian steelmakers reduced the production of rolled products by 67.3% compared to the same period in 2021 – to 4.73 million tons. Pig iron and steel production decreased by 66.1% y/y during this period – to 5.46 million tons and 5.53 million tons, respectively.
The low production of Ukrainian steelmakers is connected with logistical problems, the unfavorable situation of the world market, as well as with the destruction due to hostilities of the two largest enterprises of Ukrainian iron and steel industry – Azovstal and Ilyich Iron and Steel Works of Mariupol.
After the Russian invasion of Ukraine at the end of February 2022, Europe became the only market for Ukrainian products. At the same time, it is difficult and expensive to deliver goods by rail. The costs of steelmakers for the shipment of rolled steel to customers increased at least by 2 times, and the demand for products fell due to unfavorable market conditions.
Due to the factors mentioned above, Ukrainian iron and steel enterprises operate with low capacity utilization and even suspend some of them. Zaporizhstal operates only two blast furnaces and is considering cutting production. Kametstal works with 80% of production capacity utilization, and ArcelorMittal since July has transferred a large part of its employees to 2/3 workload schedules.
In addition, on October 10, 2022, Russian Federation shelled the state power infrastructure of Ukraine, which led to problems with energy supply to the regions. Against this background, the iron ore company Ferrexpo decided to suspend production at its enterprises in the Poltava region, and ArcelorMittal Kryvyi Rih reduced its current production volumes.
In 2021, Ukrainian steelmakers increased steel production by 3.6% compared to 2020 – up to 21.37 million tons. The production of rolled products in Ukraine in 2021 increased by 3.5% y/y – up to 19.08 million tons, while pig iron production increased by 3.6% y/y – up to 21.17 million tons.
Source: https://gmk.center/ua/
