In April 2024, the scrap collection in Ukraine experienced a significant decrease of 18.7% compared to the previous month, totaling 136.6 thousand tons, according to the Ukrainian Association of Secondary Metals (UAVtormet). This marks a 5.1% drop compared to April 2023.
The supply of raw materials to Ukrainian steel mills also saw a decrease in April, amounting to 101.5 thousand tons, which is 26.7% less than the previous month but 19.3% higher than the previous year. The increase compared to the previous year is attributed to a low comparison base due to production limitations caused by the shelling of critical energy infrastructure by Russian troops in the winter-spring period of 2023.
Furthermore, scrap exports in April reached 26.1 thousand tons, showing a 24.9% increase month-on-month and a significant 62.1% increase year-on-year. Imports of raw materials also saw a slight increase compared to the previous month and year.
The dynamics of steel production are not aligning with the scrap supplies to the domestic market, posing risks to Ukrainian steelmakers. The increasing exports of scrap, coupled with unpredictable future procurement volumes, are creating challenges for the stability of the supply chain.
Despite the difficulties in collecting raw materials amidst ongoing hostilities, the increase in exports highlights the resilience of the Ukrainian scrap market. However, with one of the main suppliers, Ukrainian Railways, halting scrap sales, the pressure on the industry is mounting.
Moving forward, the industry is looking to increase capacity and improve prospects, with a focus on ensuring sufficient scrap supply to meet the growing demands of the steel industry and achieve carbon neutrality goals.
