Ukrainian ferro alloys exports hit rock bottom in March, plummeting to a record low of 0.01 thousand tonnes (t). The dire trend persisted throughout Q1 2024, with total exports reaching just 0.69 thousand t, a staggering 99.5% decline from the previous year’s 144.54,000 t.
Revenue suffered a similar fate, plunging 98.1% to $2.42 million compared to the same period in 2023. March’s figures exemplified the crisis, with exports of 0.15,000 t generating a mere $607,000.
Poland emerged as the primary destination, receiving 74.1% of exports by value, while Uzbekistan and the Netherlands accounted for 13.8% and 4.8%, respectively.
Reasons behind declining exports:
Shutdown of ferro alloys units: The decline in Ukraine’s ferro alloy exports, ongoing since August of the previous year, can be attributed to the complete shutdown of the nation’s ferro alloys industry starting November 2023.
Reasons pertaining setback: It include the industry’s proximity to conflict zones, diminishing prices for ferro alloys, elevated production costs, and challenges in personnel retention due to mobilisation efforts. This confluence of factors resulted in a substantial 57.4% decrease in ferroalloy production in 2023 compared to the previous year.
Deficient planning: Ukrainian ferro alloys firms lack concrete plans for near-term production resumption. While Pokrovsk GOK has stated it does not intend to resume production in April 2024, there are some optimistic forecasts. Conversely, ZFP has yet to make decisions regarding resuming operations.
Outlook
Sergiy Kudryavtsev, executive director of the Ukrainian Ferro Alloy Association UkrFA, emphasised that the industry’s future in 2024 hinges on three critical factors: ceasefire stability, logistical challenges, and ensuring consistent electricity supply.
Source: GMK Center