Negative prospects for Ukrainian metallurgy

According to forecasts, in December 2019, pig iron production is expected in Ukraine at the level of 1.250 million tons; steel - 1.2 million tons; rolled metal - 1.1 million tons.

Over the past few years, Ukrainian metallurgy has shown a downward trend in steel production. So, if in December 2016 2.053 million tons of crude steel were melted, then in December 2017, 1.897 million tons were already melted, in December 2018 - 1.845 million tons, and in December 2019 no more than 1.2 million tons will be melted. The expected decrease in production volumes in December 2019 will be 37% against production volumes in December 2018 and 42% against production volumes in December 2016.

As a result, the Ukrainian steel industry is forecast to end 2019 as follows:
pig iron production - 20 million tons,
steel production - 20.5 million tons,
rolled products production - 18 million tons.

This is the worst indicator for the entire period of the existence of independent Ukraine. For comparison, if in 2017 21.3 million tons of steel were smelted, then in the previous year - 21.1 million tons.

As a result of the deteriorating situation in the global steel market, on which the stability of the Ukrainian MMC depends, it is a traditional metallurgical net exporter, since about 85% of all metal products are exported. In Q4 2019, prices for cast iron, steel and finished metal rolled products decreased by an average of 12%, and for iron ore raw materials - by 25% compared to prices in previous quarters of the current year.

The negative trends in the region are only getting stronger. This is facilitated by the complication of the situation both on foreign markets and inside the country. The revenue side is shrinking due to falling prices in the world steel markets, while the expenditure side is increasing due to a constant and often unreasonable increase in the cost of services provided by state monopolists.