12 January 2023

Due to blackouts caused by Russian missile attacks on Ukrainian energy infrastructure, Ukrainian metallurgical enterprises have significantly reduced their output in recent weeks.

According to Ukrmetallurgprom data, in total during 9m 2022 Ukrainian crude steel output made 5.53M tons (-66% to January-September 2021), thereof 3.2M tons was produced in the first two month of Y2022, 2.3M tons - during March-September (on average 330k tons per month).

If we compare with last year, then in December steel production decreased by a stunning 94%.

The situation with the production of pig iron in the reporting month was a little better - in December Ukrainian pig iron output amounted to 247,000 tons, which was 26% lower than in November.

58% of the pig iron and 66% of steel produced in December was output of Zaporizhstal, while the production at other enterprises - Kametstal (DMK), ArcelorMittal Kryvyi Rih and Interpipe was absolutely insignificant.

For example, after production was stopped on November 23, Kametstal resumed blast furnaces operation on December 13, crude steel output - only on December 28.

In total, in 2022, Ukrainian enterprises produced 6.4 million tons of pig iron and 6.26 million tons of steel (more than half - 3.2 million tons - was produced in the first two months of the year).

After the beginning of the russian invasion of Ukraine at the end of February 2022, Europe became the only export destination for the sale of Ukrainian products of the metallurgical sector, while the logistic problems still remain huge - with the blockade of Ukrainian ports, new export routes are very expensive and slow.

Also, from the point of view of production capacity, Ukraine lost two metallurgical plants located in occupied Mariupol - Azovstal and MMKI (in 2021, these two enterprises together produced 8.6 million tons of steel, which was about 40% of the total Ukrainian crude steel output).