What awaits the metallurgy of Ukraine in 2025?

Despite the efforts of Ukrainian steelmakers, steel production and exports are likely to decline in 2025, according to the GMK Center, a Ukrainian national raw materials analytical center. The main reason for this conclusion was expectations of weak performance in global steel markets and import restrictions in key sales markets, which Ukraine is likely to face.

Domestic steel consumption is also unlikely to increase. MMK expects steel production in Ukraine to decrease by more than 9% to about 6.8 million tons in 2025 from 7.58 million tons in 2024.

According to the MMC, in 2025, exports of steel products from Ukraine are expected to decrease by 600-700 thousand tons.

Steel billet

Exports of steel products from Ukraine peaked at 4.17 million tons in 2024 against 2.99 million tons in 2023, according to the country's customs service.

This was largely due to a sharp increase in the supply of semi-finished products, in particular billets, to 1.92 million tons from 1.26 million tons in 2023. The main destinations were Bulgaria and other EU countries, as well as Egypt and Turkey.

The key reasons for the increase in exports were the reopening of the maritime corridor at the end of August 2023, which restored access to important trade routes from the Black Sea basin, as well as higher prices for steel scrap compared to the billet.

The main factor in more competitive procurement prices was the lower price of iron ore in 2024.

Fastmarkets' daily price index for 62% iron ore, cfr Qingdao, averaged US$ 109.46 per tonne in 2024, compared with US$ 119.54 per tonne in 2023.

It is expected that the decline in scrap prices, which began at the end of 2024 amid the influx of cheap Chinese steel semi-finished products, will lead to a reduction in exports of billets from Ukraine in 2025.

According to Fastmarkets analysts, the price index for scrap steel of American origin in 2025 is expected to average $369.64 per ton, while the price index for steel billets should average $492.45 per ton.

If this turns out to be true, the gap between scrap and billet prices will widen to US$ 122.81 per ton, which will make the billet less attractive to foreign buyers.

According to GTT, Ukraine's neighboring
countries appear to be the country's leading trade partners in the supply of long products.

Exports of bar products to Eastern Europe reached 356,000 tons in 2024, with only minimal volumes sold to Western Europe. This volume was close to the tonnage exported in 2021 (364,000 tons), just before the Russian invasion. In 2023, exports of bar products from Ukraine to Eastern Europe amounted to only 279,000 tons.

According to GTT, Ukrainian