Head of Ukraine’s Federation of Metallurgists Serhiy Bilenky says the Ukrainian metallurgical enterprises have been operating at a loss since the beginning of 2019 due to falling demand for steel in global markets. Most of the world’s metallurgical giants are forced to either reduce production or stop operating altogether.
“Unfortunately, the situation in Ukraine is perhaps even worse than in certain countries. We have seen in recent months that steel demand has declined very much on world markets, and since we export 85% of our products, this could not but affect our enterprises. We can say that all Ukrainian metallurgical enterprises have been seeing losses since year-start. But over the recent months, losses have been increasing even more. We are already talking about how to reduce output. And we can say that certain enterprises have already been forced to halt production,” he declared.
According to Bilenky, production at Dnipro-based enterprises had to be stopped altogether.
“Will the situation worsen, we will see in the first months of next year. If we compare steel production in October of the current and past years, the decline was already about 12-13%. While we recorded a slight progress at the beginning of the year, within 5% from the previous year, for the last two months we had actually been working at a considerable loss. In the first quarter of next year we do not expect any kind of market recovery. According to our estimates and global forecasts, steel demand could recover in the second half of 2020 at best. But this is a fairly optimistic forecast,” the expert said.
“We have already encountered such crises, last time in 2015. It was more protracted in 2008. Our enterprises are aware of how to withstand such crises. But, unfortunately, we will have to save on almost everything. Each dollar in the prime cost will be crucial,” he summed up. (UNIAN/Ukrainian metal)