Steel production was halted by Ukraine's three largest metallurgical companies
Recovery after missile strikes will take months and cost tens of millions of dollars
Metinvest, Interpipe and ArcelorMittal Kryvyi Rih — three largest metallurgical companies of Ukraine — have suspended steel production. The reasons were Russian strikes, high transport costs and export problems, writes Kyiv Independent.
On September 25 ArcelorMittal Kryvyi Rih said that after a series of missile attacks it is currently impossible to resume steel output. Since the beginning of August metallurgical enterprises suffered at least nine attacks with ballistic missiles.
The strikes damaged critically important equipment, including blast furnaces. Because of this there were disruptions in pig iron smelting, without which steel cannot be produced. Ukrmetalurprom president Oleksandr Kalenkov estimated possible losses from the recent attacks at nearly $100 million.
Oleksandr Kalenkov warned that a prolonged shutdown threatens the loss of workers:
We will have to stop production until the end of the war, which may last many years. I doubt that during that time we will be able to keep our workers.
Another problem for the enterprises has been expensive logistics. According to Metinvest, transporting certain cargoes by rail or through the ports of Poland and Romania costs 50–60% more.
The situation is complicated by new trade rules of the European Union and decarbonisation requirements. Metinvest representative Oleksandr Vodoviz explained that companies have to both repair damaged capacities and pay for the transition to new environmental standards.
At the beginning of September representatives of the metallurgical industry warned the government about its critical state. They proposed establishing a special fund, the money from which would be directed to purchasing equipment and urgent repairs of enterprises.
Metallurgists also ask to give large companies access to financing from international financial institutions and to compensate part of the transport costs.
According to Kyiv Independent, on September 23 representatives of 51 countries supported a joint statement on restoring the Black Sea trade route. Metallurgical companies call the return of maritime logistics one of the main factors for the stable operation of the industry.
Restarting steelmaking production after damage can take at least several months and will require tens of millions of dollars. Companies continue to assess the condition of equipment and determine timelines for restoring plants.
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