Ukrainian metallurgy is facing a critical situation due to ongoing Russian attacks on enterprises, the blockade of Black Sea ports, high logistics costs, soaring electricity prices, and restrictions from the EU. Alexander Mironenko, the operational director of the Metinvest Group, stated in an interview with Forbes Ukraine that the financial resilience that helped companies survive the initial years of the war has been depleted.
In the years 2022-2023, Metinvest had a buffer built from pre-war operations, but that safety net has now vanished, not just for them but for all companies in the sector. Without state support and assistance from foreign partners, Mironenko warned that survival is becoming increasingly difficult. Currently, only the Central and Northern Mining and Processing Plants are operational, running at approximately 50% capacity. The Southern Mining and Processing Plant is idle due to port closures, while the Ingulets Mining and Processing Plant has been shut down due to high electricity costs.
The crisis has escalated beyond individual companies; without ports, accessible logistics, and support from the government and partners, Ukrainian metallurgy risks losing a significant portion of its production capacity. Mironenko highlighted the blockade of ports as one of the industry’s primary challenges. Without the resumption of maritime exports, even restored enterprises will struggle to operate at full capacity. The blockade has resulted in a loss of approximately 1.5 million tonnes of iron ore exports per month. Additionally, the company now imports around 250,000 tonnes of coking coal monthly, with logistical costs increasing by 50-60% due to the need to reroute through Poland and Constanța.
The EU has become the main accessible external market due to the port blockade, but quotas and the Carbon Border Adjustment Mechanism (CBAM) limit exports to about half of last year’s volume. Over the past year, Metinvest’s production costs have risen by approximately 30%, primarily due to logistics and electricity expenses. Mironenko believes that the government should establish recovery mechanisms for the industry similar to those available for other sectors affected by Russian strikes.
He pointed out that while there are funds for the energy sector to support recovery, no such funds exist for metallurgists or other industries, which is a significant oversight given that metallurgy is a major export-oriented sector that has consistently paid taxes. From 2022 to 2025, Metinvest has invested 43.6 billion UAH in enterprise development and paid over 82.2 billion UAH in taxes. Since the onset of the war, the company has allocated over 10 billion UAH to assist Ukraine and its citizens, with 7.3 billion UAH directed towards the needs of the Defence Forces under the ‘Steel Front’ initiative. Additionally, the company has adapted its production to supply goods for the front lines, including protective equipment for military personnel and machinery.
