Interpipe welcomes the resumption of UZ tenders for the sale of scrap metal

The Ukrainian industrial company Interpipe welcomes the resumption of the Ukrzaliznytsia auctions for the sale of large consignments of ferrous scrap.

Since the beginning of the year, UZ has repeatedly made attempts to hold such auctions, but the terms of shipment of scrap metal on EXW terms Seller's warehouse were risky for metallurgists who offered to buy scrap on FCA terms.

As soon as Ukrzaliznytsia took into account the position of key consumers on scrap tenders, metallurgical enterprises immediately came to the auctions.

As a result, in three days of active trading, the national railway company sold 65 thousand tons of scrap, while bailing out about UAH 350 million. Interpipe became the winner of the auction for 46% of this volume of scrap metal.

This was the first successful sale of scrap metal through the Prozorro system. Sales and consumers are awaiting further bidding from UZ. After all, the national railway company has repeatedly stated that it has about 16 thousand cars written off for sale in scrap.

But taking into account the fact that the price of scrap metal on the world markets has decreased and continues to fall, in the fall the August price level will be unacceptable. UZ needs to adapt prices to market conditions downward.

Denis Morozov, Director for Economics and Finance, Interpipe:
- We welcome the resumption of UZ's tenders for the sale of scrap metal. "Ukrzaliznytsia" went to meet the market players, so metallurgy came to the auctions. However, the bidding price turned out to be higher than the market price, but we made such a decision as a step towards UZ, which, in turn, heard the wishes of consumers and took them into account. Judging by the bidders, this approach made it possible to buy scrap for real consumers, rather than intermediaries for the purpose of resale.