Metinvest's position on the Ukrainian steel market

According to the Metinvest group of companies, in 2015 its Ukrainian market for rolled metal products will decline by 15 percent. Dmitry Lippa, CEO of Metinvest Service Center Network, said: “We believe that the rolled steel market will continue to shrink in 2015 and will decline by 15 percent YoY.”

“In 2014, the rolled steel market declined by 25-30 percent YoY. The contraction of the market is associated with a decrease in the production of the machine-building industry, most of which was exported to Russia. Metinvest also cut rebar supplies to the local market due to hostilities in eastern Ukraine, where most of the product was previously sold.
Vertically-integrated mining and metals group Metinvest expects production to fall by 10 percent by the end of 2014 compared to the business plan, if production in the second half of the year falls by 20 percent.

At present, the Yenakiyevo Metallurgical Plant is loaded by 30 percent and it is planned to increase production, but this depends on the stable operation of the railways, as well as the end of hostilities. Azovstal and Ilyich's metallurgical plant in Mariupol are operating at 70 percent of their capacity. Avdiivka Coke Plant has stopped production four times over the past three months. The plant is now operating at 20 to 25 percent of the capacity specified in the business plan.

The plan for 2015 provides for an increase in the group's production, but it is almost impossible to predict what will happen in this situation.