Ukraine may double steel production in 2023 - UAVtormet

The reduction in the procurement of ferrous scrap in Ukraine this year will amount to 930 thousand tons, which is 77.5% less than a year earlier, according to the Ukrainian Association of Secondary Metals UAVtormet.

Steel production in 2022 will be 6.5 million tons, which is 69.5% less, Callanish notes. Domestic scrap metal supplies to Ukrainian metal producers will fall by 74.4%, while exports will fall by 92.4%.

In 2023, according to the optimistic scenario, steel production in Ukraine may reach 12-12.5 million tons, while scrap supplies to metallurgical plants may amount to 1.5-1.6 million tons, and scrap procurement - 1.85-1. .9 million tons. Export of scrap next year may reach 300-320 thousand tons.

However, a realistic forecast assumes that Ukrainian steelmakers will produce 7-7.5 million tons of steel, while domestic supplies of raw materials to plants will amount to 900-950 thousand tons, export - 200-220 thousand tons, purchase of scrap - 1.2- 1.25 million tons.

“Forecast steel production volumes in 2023 are based on the assumption that steel plants operating as of December 1, 2022 will maintain their production potential, supply chains of raw materials and energy resources,” UAVtormet said in a statement.

Scrap procurement volumes in 2023 will depend on the price situation in the Ukrainian market, fair pricing for deliveries to the domestic market and export opportunities for companies specializing in scrap procurement and processing, he adds.

“Export opportunities will continue to stimulate the development and functioning of the Ukrainian scrap metal market,” the association notes. “The elimination of export duties, the simplification of obtaining a €1 certificate and the revision of current legislation may help stabilize the price situation in the market, which will lead to an increase in purchases and supplies of scrap.”

At the same time, there is an increase in the volume of ferrous scrap, resulting from the destruction of residential, industrial and infrastructure facilities, as well as from the disposal of destroyed military equipment and other property.

“Such material needs to be processed using special technologies and equipment, which means it has a higher cost,” notes UAVtormet. “The total volume of such scrap generation can now be estimated at 120-150 million tons,” he adds.