Business news from Ukraine


Ukraine in May 2020 reduced steel production by 10.4% compared to the same period in 2019, to 1.638 million tonnes, but climbed from the 15th to 13th place in the ranking of 64 countries, the main global manufacturers of these products, compiled by the World Steel Association (Worldsteel).
In May, a drop in steel production was recorded in most countries of the top ten, except for China and Iran. At the same time, the largest decline in steel production was recorded in India, by 39.1%.
In May, the top ten steel producing countries were as follows: China (92.267 million tonnes, an increase of 4.2%), Japan (5.916 million tonnes, a drop of 31.8%), South Korea (5.387 million tonnes, 14.1% down), the Russian Federation (6 million tonnes, 4.8% down), India (5.767 million tonnes, a decrease of 39.1%), the United States (4.790 million tonnes, a drop of 36.6%), Germany (2.850 million tonnes, 18.9% down), Iran (2.350 million tonnes, an increase of 8.9%), Turkey (2.272 million tonnes, a decrease of 25.8%) and Brazil (2.188 million tonnes, a drop by 22.6%).
They are followed by Vietnam (1.949 million tonnes, more by 11.4%), Taiwan (1.730 million tonnes, 10.6% less), Ukraine (1.638 million tonnes, 10.4% less), Mexico (1.450 million tonnes, 13.2% less) and Italy (1.250 million tonnes, less by 43.6%).
In May, 64 countries produced 148.775 million tonnes of steel, which is 8.7% less than in May 2019.

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The metallurgical enterprises of Ukraine in 2020, according to the updated forecast, will reduce steel production by 4.1%, to 20 million tonnes compared to actual production in 2019 in the amount of 20.848 million tonnes, and by 7% compared to the original forecast, when steelmaking in the country was predicted this year in the amount of 21.5 million tonnes.
According to the updated balance sheet for the formation and consumption of scrap metal in Ukraine for 2020, published by the Ukrainian Association of Secondary Metals (UAVtormet), 2.7 million tonnes of scrap metal will be required to produce 20 million tonnes of steel at Ukrainian metal enterprises (a decrease of 10.3% compared to 2019, when 3.011 million tonnes of imported scrap metal was delivered).
In addition, it is forecasted that export of scrap metal from Ukraine this year will amount to 50,000 tonnes, while in 2019 it amounted to 40,900 tonnes (an increase of 22.2%). At the same time, scrap import in 2020 will also amount to 50,000 tonnes.
At the same time, according to the balance sheet, scrap metal procurement in 2020 should decrease by 18.2% compared to 2019, to 2.750 million tonnes.
It is also stated that in January-April 2020, Ukraine reduced steel production by 9.5% compared to the same period last year, to 6.731 million tonnes. During this period, 901,100 tonnes of scrap metal was delivered to the country’s metal enterprises (a decrease of 8.7% compared to the four months of 2019). Exports of scrap metal from Ukraine in the four months decreased by 59.1%, to 11,600 tonnes, imports by 74.6%, to 5,700 tonnes. Scrap metal procurement for this period fell by 10.2%, to 958,300 tonnes.



Interpipe, the international vertically integrated pipe and wheel company, increased steel production by 4.8% in January-February of 2020 compared to the same period in 2019, to 138,200 tonnes.
According to the company’s monthly report on Thursday, March 19, pipe production decreased by 32.9%, to 70,500 tonnes, railway wheel production increased by 20.3%, to 17,500 tonnes for two months.
In February, production of steel amounted to 72,900 tonnes, railway wheels amounted to 18,100 tonnes, pipes amounted to 38,400 tonnes.
The company increased sales of round steel billets by 36.3%, to 4,400 tonnes, railway wheels by 43.2%, to 39,600 tonnes and reduced pipe sales by 31.3%, to 66,800 tonnes in January-February of 2020.
It is also reported that pipes were sold in Europe (35%), MENA region (22%), Ukraine (18%), the American continent (13%), the CIS (10%) and other regions (2%). Railway wheels were sold in the CIS (47%), Europe (30%), Ukraine (14%), MENA region (3%), the U.S. continent (4%) and other regions (2%) in January-February of 2020.
According to the company’s statement, the increase in sales of OCTG (oil country tubular goods) in February compared with January was due to an increase in supplies to Africa and the CIS countries, as well as stable supplies to other regions. The main part of the growth in sales of gas and oil pipelines was supported by the countries of the Middle East, Turkey and Ukraine.
“Mechanical pipes showed lower productivity compared to January due to a slowdown in industrial activity in Europe. Negative dynamics of railway wheel sales in February (14.7% less compared to January) is mainly due to the elimination of finished products overstock, accumulated in 2019, which was observed in January,” reads the statement.



Metinvest, the largest Ukrainian mining and metallurgical holding, increased steel production by 3% in 2019 compared with 2018, to 7.578 million tonnes, and pig iron production fell by 3%, to 7.928 million tonnes, and total coke production – by 11%, to 4.667 million tonnes. Metinvest B.V., the parent company of the holding, said in a report on operational results for Q4 2019 and entire 2019, in Q4 2019 pig iron production fell by 7% compared with the previous quarter, to 1.887 million tonnes due to scheduled major overhauls of blast furnaces at the Mariupol steelmakers.
Steel production in Q4 2019 fell by 16% compared with the previous quarter, to 1.673 million tonnes as the group both produced less hot metal and allocated more to make merchant pig iron. The latter came amid higher demand for that product and lower demand for slabs and finished products.
In Q4 2019, coke production totaled 1.05 million tonnes, which is 8% less than in the previous quarter due to a fall in domestic consumption in the reporting period.
In 2019, Metinvest’s coke output dropped due to: a shortage of coal that started in June 2019, as direct supply stopped from Russia; unstable operation of coke-oven batteries, a coke dryquenching plant and emergency shutdowns of coke cars early this year at Avdiyivka Coke Plant; and lower intragroup consumption in Q4 2019.



Metallurgical enterprises of Ukraine cut steel smelting by 1% in 2019 compared with 2018, to 20.848 million tonnes.
According to the reference documents of the Ministry of Economic Development, Trade and Agriculture, which are available to the Interfax-Ukraine, the output of total rolled metal also decreased 1%, to 18.387 million tonnes, and pig iron production fell by 2%, to 20.064 million tonnes.
At the same time, the agency’s source in the ministry said that scrap metal supplies to metal enterprises last year fell by 10% to 3.011 million tonnes.
In 2019, pipe production fell by 9%, to 1.005 million tonnes, coke – by 7%, to 10.059 million tonnes, and metal products remained at the level of 188,000 tonnes.
Mining enterprises last year increased iron ore production by 4%, to 75.710 million tonnes, production of iron ore concentrate grew by 5%, to 63.084 million tonnes, but they reduced prepared iron ore by 3%, to 51.675 million tonnes, including sinter production that decreased by 2%, to 30.911 million tonnes, and pellets that fell by 3%, to 20.764 million tonnes.



Ukrainian metallurgical enterprises are expected to increase steel production by 4% by the end of the year compared to 2018, up to 21.895 million tonnes.
According to background documents of Economic Development and Trade Ministry available for Interfax-Ukraine, a total rolled steel output will see 3% rise by the end of 2019, up to 18.937 million tonnes, when pig iron will see 0.4% down, to 20.748 million tonnes.
Such forecast was made following the performance indicator of January-July 2019, the ministry said.
The agency’s source in the ministry also said that under ongoing trends scrap metals supplies to the enterprises would decrease by 3%, to 3.238 million tonnes.
Besides, pipe output in 2019 may grow by 19%, to 1.144 million tonnes, coke output will drop by 5%, to 10.305 million tonnes, metalware output will drop by 1%, to 186,000 tonnes.
Meanwhile, the metal and mining enterprise can increase iron ore extraction by 4%, to 76.095 million tonnes, iron ore concentrate output by 5%, to 63.568 million tonnes, ready iron ore raw materials may increase by 1%, to 53.696 million tonnes. Sinter cake output will remain on the level of previous year with 31.706 million tonnes, steel pellets output will increase by 3% reaching 21.989 million tonnes.

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