The metallurgical industry became unprofitable – Ukrmetallurgprom

One of the main sectors of the Ukrainian economy is in deep crisis for many reasons.

The Ukrainian metallurgical industry has become unprofitable due to rising electricity prices, logistical problems in war conditions and falling world prices for metal products. President of Ukrmetallurgprom Oleksandr Kalenkov said about this in an interview with MMC Center.

According to him, businesses that continue to operate are loaded on average by 15%.

“According to the results of the 7 months of 2022, the plants produced 4.82 million tons of steel, which is minus 62% compared to the same period last year. But it should be considered that the industry has worked more or less normal in January and almost all of February, even with Azovstal, IMKI without shelling in the regions where production is located,” said Kalenkov.

At the same time, until the end of June, mining and processing plants were loaded at about 70%, but since July they have been operating at 25% capacity, while Inguletsky, Yuzhny GOK, as well as GOK ArcelorMittal Kryvyi Rih has stopped altogether.

Also, the decrease in the prices of iron ore raw materials and metal products from the beginning of the year by about 35% and 30%, respectively, led to a decline in the industry.

“In addition, electricity and logistics costs have increased. So the industry has been running at a loss for a long time, now there is no question of making a profit! Profits can only cover 50-80% of the variables that cost of businesses,” explained Kalenkov.

The head of Ukrmetallurgprom called on the authorities to develop a program of state support and incentives for metallurgists.

In particular, the metallurgists are calling for the inclusion of MMC products in the terms of the grain agreement and the continuation of sea exports, which will provide approximately $600 million in foreign exchange earnings per month .

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