FOLLOW US ON SOCIAL

Posted On

29
March
2023

Market for metal structures in Ukraine more than halves in 2022 due to war after growing by 5% in 2021 – USCC

KYIV. March 29 (Interfax-Ukraine) – The market for metal structures for construction purposes in Ukraine decreased by 55-65% in 2022, after growing by 5% in 2021, to 155,000 tonnes, the Ukrainian Steel Construction Center Association (USCC) reported.

“In 2021, the Ukrainian market for metal structures grew by about 5%, to 155,000 tonnes. According to our estimates, the drop in demand for metal structures for construction purposes in 2022 was 55-65%. Due to hostilities in 2022, half of the USCC participants were forced to temporarily or partially stop their activities,” the delo.ua portal reports with reference to the USCC press service.

At the same time, it is noted that the Metinvest metallurgical holding, which produced a lot of metal products specifically for the needs of construction and as a raw material for metal structures, actively popularized steel construction in Ukraine. However, after the main manufacturing plant of steel products for builders, Azovstal, was destroyed during the battles for Mariupol, and another manufacturer of rolled products, Illich Steel was occupied in the summer of 2022, the construction materials market faced a shortage of metal products. Later this problem was solved by importing.

With a relatively low demand for steel structures in Ukraine, builders actively used rebar produced by Azovstal and ArcelorMittal Kryvyi Rih (AMKR). At the same time, AMKR also faced significant difficulties due to a full-scale war and was forced to stop its blast furnaces.

The press service of Metinvest explained that the problem of a shortage of metal structures in Ukraine was in 2022, since the main material for their manufacture was steel sheet, which was produced at Illich Steel and Azovstal. Now such a sheet is imported, and the Metinvest group remains its main supplier to metal structures plants in Ukraine.

The USCC notes that the destruction and occupation of metal facilities, a reduction in demand in the domestic market, an increase in the exchange rate and the cost of logistics – all these factors led to an increase in the cost of rolled metal in the summer of 2022 to a maximum, followed by a gradual decrease in prices. At the end of the year, the price of rolled products increased by 41% compared to 2021, which significantly affected the cost of finished metal structures, 2/3 of which is rolled metal.

At the same time, in 2023, the steel construction center expects to see stabilization or gradual growth in the steel structure market.

There is no shortage of metal structures due to lack of exports and falling construction volumes.