Northern Mining and Processing Plant (Pivdennyi GOK, Kryvyi Rih, Dnipro Oblast), part of Metinvest Group, has repaired the LURGI 552A roasting machine and upgraded the pellet mill at pellet production shop No. 2 (PPO 2).
According to the plant’s information on Tuesday, Metinvest allocated UAH 17 million to repair the roasting machine and modernize the roar.
It was specified that the roasting machine was put back into operation at the beginning of the month after a quarterly repair.
“The main achievement of the modernization is an increase in the roasting machine’s productivity. The machine now produces 463 tons of pellets per hour compared to 460 tons previously. The second significant result of the modernization is a reduction in specific gas and electricity consumption. And the third is the improvement of the quality characteristics of finished products. All in all, we expect this to bring us up to UAH 10 million in annual benefits,” said Andriy Stebliy, deputy head of the production and planning department at Pivdenny GOK.
According to him, during the repairs, the specialists also carried out standard work, such as replacing the refractory lining of the roasting machine’s furnace and repairing metal structures. Conveyor belts were replaced in the fencing, firing and rumble sections. Process fans were repaired, conveyors, main and auxiliary units and mechanisms involved in the LURGI 552A production line were maintained.
Last summer, crude pelletizers were installed at BOF Shop No. 2 on LPGI 552B and LPGI 552A, which allowed us to reorient to the requirements of the European market and further save resources. At the same time, specialists modernized the automatic process control system.
“Metinvest is a vertically integrated group of steel and mining companies. The Group’s businesses are located primarily in Donetsk, Luhansk, Zaporizhzhia and Dnipro regions.
Metinvest’s major shareholders are SCM Group (71.25%) and Smart Holding (23.75%), which jointly manage the company. Metinvest Holding LLC is the management company of Metinvest Group.
Ferrexpo plc, a mining company with major assets in Ukraine, produced 4 million 567.168 thousand tons of pellets in January-September this year, up 41.9% year-on-year (3 million 218.273 thousand tons).
According to a press release on Monday, Ferrexpo produced 1 million 269,727 thousand tons of pellets in the third quarter of this year, down 14.4% from the previous quarter (1 million 483,468 thousand tons).
At the same time, the total production of commercial products (pellets and iron ore concentrate) in the first nine months of 2014 increased by 47.5% compared to the same period in 2023, to 5 million 125.034 thousand tons from 3 million 474.860 thousand tons. In particular, the production of commercial concentrate amounted to 557.866 thousand tons against 256.587 thousand tons in January-September 2023.
In addition, it is specified that the company, in particular, produced 326.168 thousand tons of DR pellets in the first nine months of 2014 (it did not produce any in the first nine months of 2013), 3 million 780.610 thousand tons of premium pellets and 460.390 thousand tons of other pellets.
The press release notes that during the quarter, the Group successfully operated one or two pelletizing lines (out of four), with a focus on producing higher quality products. DR pellets production continued during the third quarter, with a total of three deliveries to two customers.
Commenting on the Group’s performance, Lucio Genovese, Interim Executive Chairman, stated that the third quarter was a very challenging operational and macroeconomic environment for the company.
“As we emphasized in our interim results, the requirement to import 80% of our electricity from our western neighbors remains in place, and the resulting high tariffs continue to have a negative impact on our costs. The situation is further complicated by higher shipping rates and additional costs for war risk insurance,” Genovese said.
According to him, to mitigate the pressure on profitability, the group’s strategy was to focus on selling higher quality iron ore products to customers in close geographical proximity. This involved expanding the customer base and selling premium DR pellets in the MENA region.
The top manager emphasized that the ability to quickly adapt to modern challenges is a testament to the flexibility built into the operating model. This allowed the company to slightly reduce the impact of both the aforementioned factors and lower iron ore prices, when the fall in the 65% Fe benchmark price briefly tested price support levels of $100/tonne during the quarter, bottoming out at levels last seen in 2022.
At the same time, Genovese emphasized some positive changes in the market at the end of the reporting period: prices began to recover amid improved sentiment caused by the announcement of economic stimulus measures in China.
For his part, Group CFO Nikolay Kladiev noted that the combined effect of much lower iron ore prices and higher production costs put significant pressure on earnings in the third quarter.
“The high electricity tariffs that I pointed out in the interim period continue to grow and increase our C1 costs compared to the initial period. This year we also continued to see higher freight rates and additional war risk insurance premiums. In response, we have sought to contain costs wherever possible and manage our cash position, which remained at around $100 million at the end of the third quarter,” explained the CFO.
He also said that in the last days of September, Chinese stimulus measures, including the lifting of restrictions on home purchases, provided long-awaited support for iron ore prices.
“The pessimism about iron ore prices seems to have subsided for now, but the recent volatility in the third quarter does not provide any assurance that prices will remain at this level or improve further. We will continue to maintain a vigilant approach to our financial and operational performance for the remainder of the year,” Kladiev concluded.
As reported earlier, Ferrexpo produced 3.845 million tons of pellets in 2023, down 36.5% from 2022.
Ferrexpo owns a 100% stake in Yeristovo Mining, 99.9% in Bilanivsky GOK and 100% in Poltava Mining.
Ferrexpo plc, a mining company with major assets in Ukraine, produced 3 million 297,441 thousand tons of pellets in January-June this year, up 67.6% year-on-year (1.967 million tons).
According to a press release on Monday, Ferrexpo produced 1 million 483,468 thousand tons of pellets in the second quarter of this year, down 18.2% from the previous quarter (1 million 813,973 thousand tons).
At the same time, the total production of commercial products (pellets and iron ore concentrate) in the first half of this year increased by 75.3% compared to the same period in 2023, to 3 million 727.336 million tons from 2.126 million tons. In particular, the production of saleable concentrate amounted to 429.865 thousand tons compared to 160 thousand tons in January-June 2023.
Commenting on the group’s performance, Interim Executive Chairman Lucio Genovese pointed to strong production results for the first six months of 2024, up 83% compared to the same reporting period in 2023 and up 75% compared to the first half of last year.
“This is our best result since the start of the full-scale invasion of Ukraine in February 2022. During the quarter, access to the Black Sea shipping corridor allowed us to continue shipping from Ukrainian ports. It is estimated that over 800 vessels, including 90 carrying ferrous metals, have safely passed through the corridor since it opened in late 2023. An increase in the number of shipowners willing to charter vessels to Ukrainian ports has led to improved availability, but freight rates and insurance premiums remain high not only for passage to Ukraine but also through the Red Sea,” Genovese said.
He also stated that other price pressure factors continued to increase in the second quarter, especially electricity prices. Attacks on energy production and transmission infrastructure have significantly reduced Ukraine’s domestic energy supply. Mr. Genovese added that Ferrexpo had started looking for alternative energy from Ukraine’s European neighbors in advance, which has so far resulted in minimal disruption to its operations.
“So far, we believe that the level of risk is acceptable given the ongoing war in Ukraine. We will continue to utilize all available export capacity to ensure that the interests of all stakeholders are supported, while maintaining labor levels to increase production, generate taxes and royalties for the government and continue our humanitarian activities,” the acting CEO summarized.
According to the press release, the group successfully operated two and sometimes three pelletizing lines (out of four) during the quarter, changing product quality depending on customer demand and expanding logistics capabilities. With the variable capacity of each pelletizing line, total production for the quarter amounted to 1 million 672,506 thousand tons, including 1 million 483,468 thousand tons of pellets and 189,038 thousand tons of concentrate.
DR pellet production resumed during the quarter. The Group’s nearly completed press filtration complex has improved the physical strength and chemical quality of pellets.
Group CFO Nikolay Kladiev noted that during January-June this year, the company quickly brought previously idle capacities back into operation, thanks to renewed access to customers from the Middle East, North Africa and Asia, which led to an improvement in the cash conversion cycle.
“While we took advantage of the opportunity to produce, export and sell more, the higher iron ore prices we benefited from in the first quarter did not carry over into the second quarter. This, combined with higher electricity prices, resulted in lower margins as we approached the end of the second quarter. However, we maintained our cash position, even as we invested in capex projects aimed at maintaining resilience and improving efficiency,” the CFO stated.
As reported, Ferrexpo produced 3.845 million tons of pellets in 2023, down 36.5% from 2022.
Ferrexpo owns a 100% stake in Yeristovo Mining, 99.9% in Bilanivsky GOK and 100% in Poltava Mining.
Ferrexpo plc, a mining company with major assets in Ukraine, produced 3.814 million tonnes of pellets in January-March this year, up twice year-on-year (0.901 million tonnes) and 2.9 times more than in the previous quarter (0.627 million tonnes).
“Our operations delivered exceptional results in the first quarter, with total production up 203% quarter-on-quarter to over two million tonnes of iron ore pellets and concentrate. This is our best quarterly result since the full-scale invasion of Ukraine,” Executive Chairman Lucio Genovese said in a release on Tuesday.
It is specified that the total production of commercial products (pellets and iron ore concentrate) in the first quarter of this year amounted to 2.054 million tons, which is 2.1 times higher than in the first quarter of 2023 and 3 times higher than in the previous quarter. In particular, the production of saleable concentrate in January-March 2024 amounted to 241 thousand tons, compared to 53 thousand tons in January-March 2023 and 50 thousand tons in October-December 2023.
Genovese noted that Ferrexpo was able to export products from Ukrainian ports again during the quarter, which allowed it to supply larger volumes to Europe and resume sales to customers in the Middle East and North Africa and Asia.
According to him, the company is currently seeing an increase in the conscription of its employees: 669 Ferrexpo employees are serving in the army, which is the highest figure since the start of the full-scale invasion, while 67 employees have returned and a veterans’ reintegration program is underway.
“While we consider the level of risk acceptable given the ongoing war in Ukraine, we will continue to utilize all available export capacity to ensure that the interests of all stakeholders are supported,” Genovese concluded.
The Group also successfully operated two and sometimes three pelletizing lines (out of four) during the quarter, changing product quality depending on customer demand and expanding logistics capabilities.
Total sales for the quarter amounted to 1.992 million tons, producing only pellets with an iron content of 65%.
As reported, Ferrexpo produced 3.845 million tons of pellets in 2023, down 36.5% from 2022.
Ferrexpo owns a 100% stake in Yeristovo Mining, 99.9% in Bilanivsky GOK and 100% in Poltava Mining.
The company ended 2023 with a net loss of $84.8 million compared to a net profit of $220.0 million in 2022. Revenue for 2023 fell by 47.8% to $651.8 million, and EBITDA by 83% to $130.2 million.
Metinvest Group’s Central Mining and Processing Plant (CMP, Kryvyi Rih, Dnipro region) has modernized its pellet production equipment.
According to the company’s press release, the pelletizing plant has completed a major overhaul of the OK-324 roasting machine.
It is specified that the pelletizing plant’s process equipment operates continuously, around the clock, for more than 7.5 thousand hours a year, so its technical condition is of high priority. The repairs were carried out as part of the pellet production process optimization program.
“One of the key areas was the restoration of the refractory masonry of the roasting machine’s furnace and the repair of six nozzles. This is crucial for maintaining the thermal insulation of the roasting machine’s furnace space and will help avoid the destruction of the brickwork and ensure continuous operation during the overhaul period,” explained Andrey Ivanov, Deputy Head of the pelletizing plant at the Central Enrichment Plant.
Reportedly, an experimental solution was also implemented during the repair to apply shotcrete to the surface of the No. 9 and No. 10 tanks. This can significantly increase the resistance of refractory insulation by reducing the impact of biofuels. Additionally, the drip traps of smoke exhausters D2 and D5 were repaired, and three sections of drip trap No. 2 of smoke exhausters D2 were completely replaced. This will help reduce emissions and improve the gas dynamics of the heat flow.
The installed shaft rotation of the D3 smoke exhauster will reduce the equipment’s operating time during the plant shutdown for scheduled repairs, help reduce energy consumption, and increase equipment reliability. In addition, the conveyor transport was maintained, including the replacement of rollers, seals, and lining of the reloading units.
Central GOK is one of the five largest producers of mining raw materials in Ukraine. The company specializes in the extraction and production of iron ore concentrate and pellets.
CGOK is a part of Metinvest Group, whose major shareholders are System Capital Management (SCM, Donetsk) (71.24%) and Smart Holding Group (23.76%).
Metinvest Group’s management company is Metinvest Holding LLC.
Mining company Ferrexpo plc with assets in Ukraine produced 3.218 million tons of pellets in January-September this year, down 42.9% year-on-year (5.637 million tons).
According to the company’s announcement on Thursday, pellet production in the third quarter of 2023 increased by 17% to 1.251 million tons compared to the previous quarter.
In 2023, only pellets with an iron content of 65% were produced.
At the same time, the total production of marketable products (pellets and iron ore concentrate) for 9 months of this year amounted to 3.475 million tons. Including the production of commercial concentrate in January-September 2023 amounted to 257 thousand tons.
As reported, in 2022, Ferrexpo produced 6.053 million tons of pellets, which is 46% less than in 2021. At the same time, pellet production in the fourth quarter of 2022 decreased by 86% compared to the fourth quarter of 2021, and by 50% to 417 thousand tons by September-December 2022.
In 2022, production of premium pellets with 65% iron content amounted to 5.7 million tonnes (down 47%), including 417 thousand tonnes in the fourth quarter (down 28% quarter-on-quarter and 86% year-on-year). Last year’s production of direct reduced iron pellets (DRI, 67% iron) amounted to 353 thousand tons (down 18% by 2021), which were not produced in the fourth quarter of 2022.
No pellets with 62% iron content were produced in 2022.
At the same time, the total production of commercial products (pellets and iron ore concentrate) in 2022 decreased by 46% to 6.177 million tons, in the fourth quarter compared to the third quarter – by 49%, and by Q4 2021 – by 85%, to 457 thousand tons. In particular, the production of salable concentrate last year decreased by 47% to 124 thousand tons, including 40 thousand tons in the fourth quarter of 2022 (down 38% quarter-on-quarter and up 3% year-on-year).
Total annual sales in 2022 amounted to 6.2 million tons, down 46% compared to 2021.
Ferrexpo is an iron ore company with assets in Ukraine.
Ferrexpo owns 100% of Yeristovo Mining, 99.9% of Bilanivsky GOK and 100% of Poltava Mining.
