Ukraine's ferro alloy exports surge to 5-month peak despite sectoral obstacles

In May 2024, Ukraine's ferro alloy sector exhibited a notable recovery in export volumes, marking a significant contrast to the minimal exports recorded between January and April of the same year.

According to data from the State Customs Service, Ukrainian ferro alloy enterprises exported 5.53 thousand tonnes (t) of products during the month, representing a substantial increase from the preceding months and underscoring a positive shift in operational activity.

Despite the m-o-m increase, May 2024 exports were 88.6% lower compared to the same period in 2023, reflecting the enduring challenges faced by the industry.

However, the export volume for May 2024 surged significantly compared to April 2024, where exports were a mere 0.45 thousand tonnes. This uptick indicates a tentative recovery phase after a prolonged downturn that saw shipments drop to record lows of 0.2-0.4 thousand tonnes per month between December 2023 and April 2024.

The resurgence in May 2024 exports can be partly attributed to:

Resumption of operations: At the Zaporizhzhia Ferroalloy Plant (ZFP) and potential plans for Nikopol Ferroalloy Plant (NFP) to recommence production. Currently, ZFP is operating at a minimal capacity of 7%, utilising two furnaces, with no immediate plans for expansion.

Conversely, Pokrovsk Mining, Marganets Mining, and Pobuzhsky Ferronickel Plant (PFP) remain idle, reflecting the varied operational statuses within the sector.

Looking ahead, the recovery trajectory of Ukraine's ferro alloy industry in 2024 hinges on overcoming persistent challenges such as security risks, logistical constraints, and ensuring access to affordable electricity. The sector's performance will be closely monitored as stakeholders navigate these obstacles to stabilise production levels and regain competitiveness in global markets.

Source: GMK Center