- Capacity utilisation drops amid high energy costs
- SiMn output down 45%, exports plummet by 77.5%
GMK: Ukraine’s ferro alloys industry faced a severe downturn in 2024, with production falling by 49.4% y-o-y to just 108,150 t. This dramatic drop was mainly driven by extended downtimes at key producers, particularly in the first half of the year, due to severe energy shortages and skyrocketing electricity costs. As ferro alloys production is highly energy-intensive, the industry was particularly vulnerable to these challenges.
Silico manganese production, the largest segment, dropped by 45%, reaching 104,150 t, while ferro manganese and ferro silicon saw even steeper declines of 66.5% and 98.8%, respectively. However, Zaporizhzhya Ferroalloy Plant (ZFP) managed to increase its output by 35.2% compared to 2023, with a notable rise in silico manganese production – up to 23,100 t from just 3,870 t. In contrast, the Nikopol Ferroalloy Plant (NFP) experienced a substantial 58% production drop, especially in silico manganese.
The Ukrainian ferro alloys export market also saw a sharp contraction, with volumes plummeting by 77.5%, from 344,170 t in 2023 to just 77,320 t in 2024. Poland, Turkey, and Italy, the main consumers of Ukrainian ferro alloys, also reduced their imports significantly.
The industry’s difficulties were compounded by the shutdown of key facilities like Pokrovsk Mining and Marganets Mining, which halted manganese concentrate production. Despite some recovery in the second half of 2024 as production gradually resumed, high energy costs and limited capacity utilisation (with plants operating at just 7% of total capacity) continued to hamper the sector’s full recovery.
Outlook
Going forward, unless energy supply issues are resolved, Ukraine’s ferro alloys production is likely to remain under pressure.
Note: This article has been written in accordance with a content exchange agreement between GMK and BigMint.
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