Ukraine Steel Industry Faces EU Tariffs Despite War

The European Union's recent import restrictions on steel products are unfairly impacting Ukraine's war-ravaged industry, according to Yuriy Ryzhenkov, CEO of Metinvest, one of the country's largest steel companies. Ryzhenkov stated that Ukraine has been "bundled together" with measures primarily targeting cheap imports from nations like China and Turkey, despite its ongoing struggle following Russia's full-scale invasion.

"Access to the European market is crucial for survival," Ryzhenkov told the BBC. "The restrictive measures that have been put in place by the authorities in the European Union, they don't help." He called for at least an exemption for Ukraine to access the EU market, emphasizing the lack of consideration for the country's unique situation.

The EU has capped duty-free steel imports at 18.3 million tonnes annually, a significant reduction from previous levels. While country-specific quotas exist, the overarching goal is to reduce overall imports to protect European steel manufacturers.

A spokesperson for the European Commission acknowledged that the EU "took into account the difficult situation" of Ukraine when formulating its steel policy. They added that Ukraine's specific steel quota guarantees some exports, though at a level lower than in past years. The EU stated it has offered compensation to its largest suppliers, including Ukraine, recognizing its importance as an exporter.

Despite a free-trade agreement between the EU and Ukraine, it does not prevent the bloc from implementing separate trade protection measures. Ryzhenkov estimates that Ukrainian steel exports to the EU could ultimately decrease by 50% to 60% due to these restrictions.

Steel is a cornerstone of Ukraine's economy. Prior to the 2022 invasion, metallurgy and mining contributed about 10% of the national income and a third of exports, with the EU being the primary customer. The industry has suffered immensely from continuous Russian bombardment, with all of Ukraine's steel mills experiencing damage. Ryzhenkov noted a significant intensification of strikes recently, even reporting a period in September where no steel was produced in Ukraine for the first time in approximately 150 years. Metinvest alone has lost nearly 800 workers since the war began.

Ryzhenkov also expressed concerns about the upcoming winter, anticipating it to be "one of the hardest in our history." He highlighted the logistical challenges faced by Ukrainian producers, who rely heavily on the EU market, and stated that a 60% reduction in market access hinders the industry's ability to survive.