Exclusive What is happening on the Ukrainian machine-building steel market

The greatest demand is generated by the defense industry, related engineering, and repair industries

The Ukrainian machine-building steel market in 2026 presents a paradox: despite a partial recovery in the industry, sales volumes are barely holding steady at last year’s levels. Half of all orders are provided by the defense industry, while civil machine building is still far from pre-war levels.

The situation on the engineering steel market

The market showed a recovery in 2024–2025, but it was uneven. The main growth was driven by defense orders and a partial recovery of the industry. Civil engineering has not yet achieved sustainable growth; we observed a significant decline in railcar manufacturing and mining machinery, while agricultural machinery showed positive growth.

The market remains highly competitive with a significant share of imports, which have increased significantly, mainly due to supplies from Turkey and China. The key trend is demand for fast delivery.

The main drivers of growth in 2025 were the defense industry and companies involved in infrastructure restoration.

Results for 2025

In the first half of last year, we increased sales by 15%, confirming the positive dynamics of market recovery and our adaptation to the current conditions and realities of wartime. In the second half of the year, we faced a decline in demand, which we attribute to the underfunding of the main driver of development – the defense industry, which affected the overall results.

At the end of last year, the company’s sales volumes remained at the 2024 level. We have not yet returned to pre-war levels, but we have maintained business stability and key positions in the machine-building steel market.

Demand by type of rolled steel

The greatest growth was observed in the segment of special and alloy steels, calibrated rolled products, and products with increased quality requirements. Demand for standard items remained subdued, while demand for niche and technically complex products increased.

According to the results for 2025, sales of calibrated rolled products increased by 16%, which correlates with the growth in demand in the segment.

Demand structure by industry and region

The greatest demand comes from the defense industry, which accounts for almost 50% of the order portfolio, related machine building, and repair industries. Today, the defense industry is the driver of Ukrainian industrial development. It provides the basic demand for machine-building steel and effectively supports the entire chain of related industries.

Machinery manufacturing is recovering, but slowly and fragmentarily. Enterprises related to defense, equipment repair, and export-oriented niches are developing more actively. There has been no massive increase in civil machinery manufacturing yet.

Geographically, the greatest demand remains in the central and western regions of Ukraine, where new production clusters are now actively forming.

Market challenges

Key challenges include logistical constraints, labor shortages, energy supply issues, underfunding of state-contract manufacturing, and ongoing enemy attacks on industry.

Market development forecast

We expect moderate market growth, with the defense industry and specialized segments playing a key role. A sustained breakthrough can only be expected if the security situation improves and large-scale economic recovery programs are launched.