Head of the Ukrainian Ferroalloy Association UkrFA, Mr. Sergey Kudryavtsev, said in an interview with the Ministry of Industry and Trade that Ukrainian ferroalloy enterprises reduced production by 57.4% in 2023 compared to 2022.
The shutdown of three major plants in November 2023 - Nikopol Ferroalloy Plant, Zaporizhzhya Ferroalloy Plant and Marganets Mining and Processing Plant had a significant impact on the industry's performance. This was due not only to the hostilities, but also to falling prices for ferroalloys, logistical constraints and rising electricity tariffs, which affected production costs and profitability.
According to the UkrFA director, even if the factories are able to restart production in the summer, they will face significant staffing problems due to the imperfect mechanism of reserving for mobilization, in particular, specialists of the main production equipment.
He also added that the government should take measures to support the industry. While the government's influence on tariff regulation is unlikely, the emphasis should be on establishing logistics and regulating the booking of workers. Also, he highlighted the potential logistical advantages of a sea corridor. He suggested that it could enhance the security of exports while also promoting access to imported raw materials at competitive prices.
The future of the Ukrainian ferroalloy industry in 2024 will depend on three factors: shelling, logistics and electricity.
In addition, Mr. Kudryavtsev said that without solving these problems, it is unlikely that the plants will be able to resume full operations.
Exports of ferroalloys from Ukraine in 2023 also decreased by 4.9% compared to 2022 to 344.2 thousand tons. Compared to pre-war 2021, overseas shipments fell by 48.5% or 324.4 thousand tons. The largest consumer of Ukrainian ferroalloys in 2023 was Poland with a share of 52.8% in monetary terms. Türkiye accounted for 14.1% of exports, while the Netherlands accounted for 8.5%.
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