US tariffs on steel imports could lead to undesirable consequences for Ukrainian steelmakers and Metinvest Group. This is reported in an Associated Press article.
Metinvest’s Chief Operating Officer Olexander Myronenko explained that there are concerns that US steel tariffs will have ripple effects. For example, European countries may impose import duties on Ukrainian products to compensate for the new taxes on their goods, and this will be a problem for the group.
The bloc currently accounts for the lion’s share of Ukraine’s steel exports, AP notes. In particular, about 80% of Metinvest’s steel exports go to Europe. Ukraine plans to make the EU part of its proposal for duty-free trade.
The company also has a plant in Bulgaria, an EU member state. The company exports rebar steel to the US, which is commonly used as rods in concrete. According to Myronenko, the supply of rebar will also be subject to the new US duties. This could lead to a drop in demand and difficulties for the Bulgarian company.
The full-scale Russian invasion has already resulted in the company losing control of two steel plants in Mariupol. In addition, Metinvest has suspended operations at its Pokrovsk mine and evacuated employees due to the advance of enemy troops. Thus, according to Zaporizhstal CEO Taras Shevchenko, in order to keep the plant running, Metinvest has to import 1 million tons of coking coal per year from Europe and the United States. Currently, the Zaporizhzhia plant is operating at 75% of its capacity.
The war has also brought other challenges, including skyrocketing energy prices due to continuous attacks on Ukraine’s power grid and disruption of trade routes.
Ukraine is hoping to get an exemption from the US on steel imports until March 2026 for Ukrainian steel products, as well as for EU products made from Ukrainian semi-finished products. Kyiv’s argument is that the total value of steel supplied to the US from Ukraine directly and through processing in the EU is only 0.81% of total US imports of steel products and cannot threaten US industry.
Ukrmetprom, which represents the interests of the Ukrainian steel and mining industry, has warned that if the new US import duties come into effect on March 12 this year as planned, it will cost the country’s industry $58 million in foreign exchange earnings and a reduction in tax payments to the Ukrainian state budget by UAH 1 billion.
First Vice Prime Minister and Minister of Economy Yulia Svyrydenko said that Ukraine is committed to working with the US to find an optimal solution to the steel and aluminum tariffs.
