The situation in Ukraine's metallurgy sector is currently catastrophic, in particular due to shelling: five furnaces at Metinvest Group's enterprises have been destroyed, two furnaces at ArcelorMittal Kryvyi Rih (AMKR, Dnipropetrovsk region) have been destroyed, and the steel plants are not operating, Oleksandr Vodoviz, head of the office of the CEO of Metinvest Group, said at the Economic Resilience Forum organized by Forbes Ukraine in Kyiv on Wednesday.
"All the plants have been destroyed. This is Arcelor, Metinvest, Petrovsky Plant (DMZ of Yaroslavsky – IF-U) and Interpipe. They have been hit several times. Many people have been killed. We are not operating. I know that Arcelor is not operating. As far as I know, Petrovsky Plant has also been shut down. And Interpipe, as far as I know, has not repaired its transformer either," Vodoviz said.
According to him, there was a week in September when Ukraine did not produce a single tonne of steel for the first time in 100 years, while Metinvest's enterprises remain shut down.
"We are standing idle and assessing the possibility of resuming operations. We tried to restart at Zaporizhstal: we started up a furnace, it operated for 10 hours and then there was another strike. To give you an idea, starting up a furnace costs from $50 million, while the furnace itself costs $500 million. Repairing it somehow requires enormous funds," the top manager said.
He added that the company had sought assistance from various ministries, but the aid offered was at the level of UAH 2-5 million.
While agreeing on the need to support small businesses, Vodoviz stressed that big business is the foundation around which small businesses operate.
"They supply us with water and cables and carry out work. We have 50,000 contractors. Unfortunately, there is no solution for big business today. Here, a respected person asked the Economy Ministry what the plan was. Did you all hear the plan? I did not. There is no plan right now. So we would like to hear what the plan is. What next? Should we lay people off or not? We are all living in anticipation," the head of Metinvest's CEO office said.
According to him, the group is currently planning its actions for no more than a month ahead.
"Nobody is looking beyond six months. Everyone is sitting and watching what happens next. My view is that the situation in the economy is extraordinary. Extraordinary decisions are needed. You cannot live in an extraordinary situation and make decisions that are always made," the expert said.
Asked about the amount of investment needed for recovery, Vodoviz said the group had not yet calculated it.
"We have not calculated it yet, but, for example, I told you that one furnace costs $500 million if it is built virtually from scratch, and all our furnaces are destroyed – five. Two have been destroyed at Arcelor. That's billions of dollars. But we are studying the situation. We definitely will not invest money in recovery now because we do not understand how the situation will develop," the top manager explained.
He noted that if the situation changes somehow over the next month or two, relevant decisions will be made, but there are none at present. He clarified that Metinvest's decision-making depends on three factors, not all of them military. The first and main one is shelling and strikes on enterprises.
"The second is ports. We are currently not shipping or exporting, although until 2026 we were the country's largest exporter. And the third, strange as it may seem, is our European friends and partners, who have completely closed their markets to our exports of metal products. They introduced CBAM, they introduced quotas. At the same time, they promised us that this would not happen. We took part in negotiations with the Ministry of European Integration and the Economy Ministry. But the EU introduced them anyway," Vodoviz said.
According to him, these are the three major problems that need to be resolved.
Regarding government assistance, the manager said: "We are not getting involved in the government, we are not asking for any grants, we do not want the government to finance us. We simply want to be on equal terms. There is, for example, the Ukraine Facility program. I know that some funds are allocated from the Ukraine Facility. Unfortunately, we do not have access to this program, although we would like to have it," the top manager said.
As for proposals to raise taxes, he said he believed they "would lead to nothing good."
"Here, probably every business would say: do not get in our way," Vodoviz concluded.
Metinvest is a vertically integrated group of mining and steelmaking enterprises. The group's enterprises are located mainly in Donetsk, Luhansk, Zaporizhia and Dnipropetrovsk regions. The group's main shareholders are SCM Group (71.24%) and Smart Holding (23.76%), which jointly manage it. Metinvest Holding LLC is the group's management company.
