Mining company Ferrexpo plc with assets in Ukraine produced 901,000 tons of pellets in January-March this year, down 67% from the same period last year.
According to the company’s stock exchange statement on Thursday, the production of pellets in the first quarter of 2023 increased 2.16 times compared with the fourth quarter of 2022 (in October-December last year – 417 thousand tons).
In 2023, only pellets with iron content of 65% were produced.
The total production of commercial products (pellets and iron ore concentrate) for the first quarter of this year decreased by 65% by the first quarter of 2022, but increased 2,1 times to 954 thousand tons by the fourth quarter of 2022. Including commercial concentrate output in January-March 2023 amounted to 53 thousand tons (+32% compared to the previous quarter).
The press release explains that the increase in pellet output in the first quarter of this year was due to the improved power supply, which allowed to restart the second pelletizing line at the end of February 2023. At the same time, the decrease in the group’s production compared to last year is due to operational and logistical constraints since the start of Russia’s full-scale military invasion in February last year.
The company continues to focus on high iron content products.
The Group intends to continue to operate one to two pellet lines in the next quarter, as in the first quarter of 2023, provided there are no further significant changes in the operating environment and logistics availability in Ukraine.
Total iron ore sales were 0.85 million tonnes during January-March 2023 with shipments to European customers by rail and barge.
Ferrexpo CEO Jim North commented that pellet production of 0.9 million tons during the first quarter of 2023 represents a significant increase over the previous quarter and reflects the easing of operational constraints experienced late last year.
“As noted in our recent full year results announcement, we are now able to operate our second pelletizing line (of four) and our logistics networks are able to provide sales volumes to customers in line with this level of demand. Going forward, we aim to balance production volumes with a conservative approach to maintain group balance and liquidity metrics, ensuring stable deliveries to our long-term customers,” North was quoted in the press release.
As reported, Ferrexpo produced 6.053 million tons of pellets in 2022, down 46% from 2021. At the same time, pellet production in the fourth quarter of 2022 decreased by 86% from the fourth quarter of 2021, and by September-December 2022 decreased by 50% to 417,000 tons.
Production of premium pellets with 65% iron content in 2022 was 5.7 million tonnes (down 47%), including 417 thousand tonnes in the fourth quarter (down 28% quarter-on-quarter and 86% year-on-year). Direct reduction of iron pellets (DRI, 67% iron) output last year was 353 thousand tonnes (down 18% q-o-q), which was not produced in Q4-2022.
No pellets with 62% iron content were produced in 2022.
At the same time, 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, by 49%, and by Q4-2021 – by 85%, to 457 thousand tons. Last year’s output of marketable concentrate fell by 47% to 124 kt, including 40 kt in Q4-2022 (down 38% q-o-q and up 3% q-o-q on the same period last year).
Total annual sales in 2022 were 6.2 million tons, down 46% from 2021.
Poltava GOK has four pellet production lines.
Ferrexpo is an iron ore company with assets in Ukraine.
Ferrexpo owns a 100% stake in Yeristovsky GOK LLC and a 99.9% stake in Belanovsky GOK LLC. Before the September 2022 court ruling, Ferrexpo also owned 100% of Poltava GOK PJSC.
Metinvest’s subsidiary Central Mining and Processing Integrated Works, located in Krivoy Rog, Dnipropetrovsk Region, reduced the output of its marketable pellets by about 3% year-on-year to 2 million tons in January-November this year.
“Owing to coordinated actions, the combine’s team achieved 100% of production and processing targets. In the first 11 months of this year alone, miners mined more than 9 million tons of crude ore, concentrators produced more than 3 million tons of concentrate, and pelletizers produced nearly 2 million tons of high quality pellets,” the company says.
At the same time, it is said that this year was a period of trials, which the company’s team managed to cope with with with dignity. Despite the war, logistical problems and economic challenges, the company remains one of the best in Ukraine’s mining industry.
Thus, in 2022, TsGOK continued producing high-quality products – concentrate with iron content of 70% and above, and pellets with iron content of 67.5%. This influenced the fact that the company remained with orders in a difficult period and was able to work, fulfilling its obligations to customers and providing jobs for its employees.
Central Mining and Processing Plant’s staff continues to upgrade the production facilities in the plant’s shops. Specialists have overhauled pelletizing plant equipment and roasting machine OK-324. At the crushing plant, one of the largest units – the coarse crusher – and the conveyor transport were overhauled. The renewed equipment is ready to accept up to 4.5 million additional tons of iron ore.
In order to support the heavy-weight transport in the mining and transport shops of the combine during the year the heavy-weight dump trucks were repaired by their own hands. To ensure safe and efficient operation of railway transport, tracks were repaired.
This year the humanitarian mission was added to the industrial tasks of the Central Mining and Processing Division. In March the humanitarian hub started its work at the Works within the framework of the project “Saving Lives”, implemented by Metinvest Group in coordination with Rinat Akhmetov’s Foundation. During this time the workers-volunteers of the Works have put together 135 thousand food packages for the IDPs, the representatives of the privileged categories, the families of the mobilized and the veterans of the Works.
An active volunteer movement is carried out by the TsGOK’s youth, who collect humanitarian aid, support in the search of accommodation, render targeted assistance to the labour veterans and pensioners of the enterprise and hold entertainment events for children from the families of internally displaced persons.
“The staff of the Central Mining and Processing Plant is an example of indestructibility and reliability. This year our specialists have shown that they can support each other and our common cause. Today we understand how important the work of the enterprise is for the economy of Ukraine and how important it is to be human and friendly outside the production. Our team is a big family where the workers are heroes in their place. I’m grateful to each specialist for his work in this difficult time and I am sure that the new year of the plant will be productive”, – General Director of Central Mining Dmitry Shevchik is convinced, who is quoted by the press service.
As Ukrainian News earlier reported, in 11M22 Central Mining decreased the output of marketable pellets by 0.4% YoY to 2.054 million tons and iron ore concentrate by 2.8% to 4.376 million tons.
Central Mining is one of the five largest mining producers in Ukraine. It specializes in the mining and production of iron ore raw materials – concentrates and pellets.
Central Mining is part of Metinvest Group, whose major shareholders are System Capital Management (SKM, Donetsk) (71.24%) and Smart-Holding Group (23.76%).
The management company of the Metinvest group is Metinvest Holding LLC.
Pivnichny (Northern) Mining and Processing Plant (Kryvy Rih, Dnipropetrovsk region), part of Metinvest Group, increased production of commercial pellets in 2021, according to recent data, by 20.2% compared to 2020, to 6.35 million tonnes.
As the company told Interfax-Ukraine, in December production of pellets amounted to 550,000 tonnes.
At the same time, output of iron ore concentrate last year increased by 5.2%, to 13.4 million tonnes, including 1.13 million tonnes produced in December.
In 2020, the plant reduced production of commercial pellets by 32.6% compared to 2019, to 5.28 million tonnes, and production of iron ore concentrate increased by 4%, to 12.739 million tonnes.
Pivnichny Mining and Processing Plant is part of Metinvest Group, the main shareholders of which are PrJSC System Capital Management (SCM, Donetsk, 71.24%) and Smart-Holding (23.76%).
Metinvest Group’s management company is Metinvest Holding LLC
Central Mining and Processing Plant (Kryvy Rih, Dnipropetrovsk region), part of Metinvest Group, in January-October this year, reduced production of commercial pellets, according to recent data, by 0.5% y-o-y, to 1.850 million tonnes.
As the enterprise told Interfax-Ukraine, in October production of pellets amounted to 110,210 tonnes.
Over ten months, Central Mining reduced production of iron ore concentrate by 2.9%, to 3.959 million tonnes, including 433,163 tonnes produced in October.
At the same time, the agency source noted that in recent months, the lag in production this year has been decreasing in comparison with the previous year. So, in particular, the relative level of backlog of production of commercial pellets in nine months of this year was 2.5% y-o-y, and concentrate – 3%.
As Yuriy Ryzhenkov, CEO of Metinvest, recently announced, in 2020 the company received the first high-quality pellets at Central Mining – DRI-class pellets. The next step is Pivnichny (Northern) Mining and Processing Plant.
British-based Ferrexpo plc, which controls in Ukraine, in particular, Poltava and Yeristovo mining and processing plants (GOK), in January-October this year, according to recent data, increased production of pellets by 0.1% compared to the same period last year – up to 9.19 million tonnes.A representative of the company informed Interfax-Ukraine in October production of pellets amounted to 1.035 million tonnes.At the same time, the company produced 12.18 million tonnes of iron ore concentrate, which is 5.9% higher than in the same period last year, in October it produced 1.24 million tonnes.According to the company’s presentation, in November the daily production of pellets will increase in comparison with October and September to almost 35,000 tonnes per day, which will allow to increase the overall production of pellets in the fourth quarter.In 2022, the company predicts an increase in pellet production above the level of 2021, in particular pellet production through direct reduction with a 67% iron content will be in the range of 0.5-1 million tonnes.Ferrexpo is an iron ore company with assets in Ukraine.Ferrexpo owns 100% of the shares of Poltava GOK, 100% of Yeristovo GOK and 99.9% of Belanovo GOK.
British-based Ferrexpo plc, which controls in Ukraine, in particular, Poltava and Yeristovo mining and processing plants, in January-September 2021 increased total production of pellets by 0.3% compared to the same period in 2020, to 8.158 million tonnes.
According to a press release from the company on Wednesday, total production, including pellets and salable concentrate, rose 3% to 8.393 million tonnes over the period.
At the same time, total production of pellets with 65% iron content amounted to 7.829 million tonnes (a decrease of 0.3%). Pellets with 62% iron content were not produced. Production of direct reduction (DR) pellets with 67% iron content amounted to 330,000 tonnes (up by 76%).
Over the nine months of 2021, the company also produced 234,000 tonnes of salable concentrate with 67% iron content, while in 2020 it did not produce salable concentrate.
In the third quarter of 2021, total pellet production fell 9% quarter on quarter (qoq), but increased 2% versus Q3 2020, to 2.596 million tonnes. In particular, 2.401 million tonnes of pellets with 65% iron content were produced (a decrease by 13% versus the second quarter of 2021 and by 5% versus the third quarter of last year), no pellets with 62% grade were produced, production of DR pellets with 67% iron content amounted to 195,000 tonnes (an increase of 130% compared to the previous quarter).
The company also produced 85,000 tonnes of salable concentrate with 67% iron content in the third quarter of 2021 (an increase of 0.2% compared to the second quarter).
Total production, including production of pellets and commercial concentrate, in the third quarter of this year decreased by 9% compared to the second quarter of 2021, but increased by 6% compared to the third quarter of 2020, to 2.680 million tonnes.
The press release explains that the 2% increase in iron ore pellet output in Q3 2021 versus Q3 2020 reflects strong production performance following pelletiser upgrade work completed in previous quarters. Production volumes are 9% lower on a quarter on quarter basis as a result of pelletiser upgrade work completed during the quarter, and planned pelletiser maintenance in September 2021.
In addition, upgrade work on the group’s fourth pelletiser line completed during September 2021.
Production of iron ore concentrate with a high iron content (65% and above) in the third quarter was in line with the previous quarter.
In addition, it clarifies that the proportion of direct reduction pellets with higher iron content (67% Fe) increased to 8% of total pellet production during the third quarter from 3% in the previous quarter, reflecting the group’s continuing expansion into this market.
In turn, continued production of commercial high grade concentrate (67% Fe) at 85,000 tonnes in the third quarter reflects the group’s recent investment in in its concentrate stockyard project.
Interim Group Chief Executive Officer Jim North pointed to the group’s continued progress towards improving product quality and output following the completion of the pelletizer upgrade.
“Through continued investment in the group’s concentrator and pelletiser facilities, we are creating a platform for future growth in product volumes, whilst simultaneously increasing the overall grade of our production,” North is cited in the press release.
