EU quota system 'could kill Ukrainian steel industry', boss warns
The CEO of Metinvest, Ukraine's largest steelmaker, warns that new EU import quotas and tariffs could destroy the country's steel industry and harm its budget amid the war with Russia.
EU protectionist measures threaten Ukraine's steel sector
New European Union limits on steel imports, set to take effect on July 1, could cripple Ukraine's industry and significantly impact its budget as it defends itself against Russian aggression, according to Yuriy Ryzhenkov, CEO of Metinvest, Ukraine's largest steelmaker.
The EU has introduced protectionist measures in response to a global steel glut caused by China. The bloc has halved the quotas for tariff-free steel imports and doubled the tariff to a prohibitive 50% on all imports exceeding each country's allocation.
Ryzhenkov called the approach unfair. "Ukraine does not present a significant threat to the EU steel industry. It's simply not big enough," he said. "Killing off one of the functioning industries doesn't seem wise. We don't see any leniency towards Ukraine."
The war has already forced Ukrainian steelmakers to cut off some previous alternative markets and integrate more closely with Europe, while facing extra costs from constant attacks on infrastructure. Metinvest has lost key assets, including the Mariupol steelworks destroyed early in the war and the Pokrovsk coking coal mine, now a battleground.
Ukrainian steelmakers argue the quotas would also harm the war effort by depriving the government of hundreds of millions of pounds in tax revenue. Metinvest, owned by billionaire Rinat Akhmetov, is believed to be the largest private-sector taxpayer in the country.
In addition to quotas, the EU has imposed a carbon border adjustment mechanism penalizing dirtier blast furnace technology. Ryzhenkov said it is impossible for Metinvest to invest billions of euros to upgrade to cleaner electric arc furnaces due to the war, though it had planned to do so before Russia's full-scale invasion.
Metinvest's two plants near Zaporizhzhia and Kamianske are operating at about 75% and 66% capacity, respectively. The company struggles with regular damage to railways used for transporting products and inconsistent electricity supply after years of Russian attacks on Ukraine's power grid. It has installed its own generators to restart operations more quickly after blackouts.
