The latest data from the MMC of Ukraine for five months of this year indicate an extension of the crisis in the Ukrainian metallurgical industry, which is associated with the general situation in the global steel market at the end of 2019. The negative situation has been exacerbated by the COVID-19 coronavirus pandemic.
In January-May 2020, metallurgical enterprises of Ukraine produced:
– agglomerate – 13.10 million tons (98.6% compared to the same period in 2019)
– bulk coke (6% vol.) -4020000 tons (90.9%);
– pig iron – 8,160,000 tons (93.5%);
– steel – 8.30 million tons (89.5%);
– rolled products – 7,430,000 tons (93.8%);
– pipe products – 0 330 000 tons (70.2%).
The main reasons for the decline in the production of the main types of metallurgical products, along with the global quarantine, are still state protectionism in the export countries traditional for Ukrainian metallurgy, the presence of surplus global steelmaking capacities in the amount of about 440 million tons per year, a decrease in prices and a decrease in demand for metal products.
Negative trends in the region are only intensifying, this is facilitated not only by the deterioration of the situation in foreign markets, but also within the country. Both the tariff policy of the infrastructure monopolies and the fiscal policy of the state have a negative impact on the industry. Thus, high tariffs and inefficiency of national state monopolists, illogical trade restrictions and imports of raw materials and materials for mining and smelting, an increase in the rental burden can lead to a disaster in an industry important for the national economy, which provides about 26% of foreign exchange earnings, 12% of GDP, more than 30 billion UAH deductions to budgets of all levels (at the end of 2019) and more than 600 thousand jobs (taking into account related industries).