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Pandemic forced ArcelorMittal Kryvyi Rih to reorient trade flows

Ukraine / Ferrous metallurgy

Losses of the largest Ukrainian metallurgical enterprise in foreign markets reached one million tons of steel.

Pandemic forced ArcelorMittal Kryvyi Rih to reorient trade flows

Due to lockdowns, a decrease in demand, which is very sensitive for the largest metallurgical plant in Ukraine, occurred in the European market. MENA countries (Middle East and North Africa) also significantly reduced activity. Therefore, ArcelorMittal Kryvyi Rih had to reorient trade flows to other regions, said Yevgeny Chumachenko, director of the company's sales department.

“In general, we believe that ArcelorMittal Kryvyi Rih passed the test with honor, although it was not easy. Reorientation to new sales markets is always a very laborious process. New markets imply new standards. We have to re-pass the product certification process, taking into account the legislation of the countries to which it is planned to supply the goods. And the governments of these countries, when they see that imports are growing, come up with all kinds of barriers. It can be just duties, as in the USA, quotas, as in the EU countries, or tightening of certification rules by states. As a result, it can be completed for six months, a year, or even a longer period, "- said the top manager of the plant.

This year has further confused the cards in the global steel market. At first, countries were quarantined one after another and reduced metal consumption. In the second half of the year, demand for rolled products and prices began to recover, but not everywhere and not as quickly as metallurgists would like.

In addition, the situation was aggravated by a new wave of protectionism. Many governments in charge of the largest national economies, wanting to support their own producers, have tightened protective measures against imports. Against this background, the Ukrainian market remains fairly open for foreign suppliers. And this does not please domestic producers at all.

“Competition is felt, especially from the side of the Belarusian Metallurgical Plant. In addition, we periodically observe deliveries from Turkish manufacturers. The Ukrainian market, in principle, is quite open, and, alas, there are practically no barriers to supplies from outside, ”Yevgeny Chumachenko noted.

Recently, ArcelorMittal Kryvyi Rih has been faced with the fact that most states are strengthening protectionist measures against the import of Ukrainian rebar and wire rod. The company stated that it had lost, for example, Egypt as a sales market. In the Gulf countries, 200 thousand tons of steel products sales were lost. In Latin America, some countries have tightened certification, and there about 100 thousand tons were also lost. In total, this is already almost 1 million tons. According to the top manager of ArcelorMittal Kryvyi Rih, the lost sales volume should be reoriented to other directions, to Southeast Asia, including.

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