Poland’s Alchemia decides to liquidate its pipe production branch in Czestochowa

The decision to liquidate the Rurexpol branch, among other things, was made amid deteriorating situation in European steel industry

The board of the Polish industrial group Boryszew SA has announced the decision of its steel subsidiary Alchemia SA to start the process of liquidating the Rurexpol branch in Czestochowa. This is stated in the group’s stock exchange announcement.

Rurexpol is a producer of seamless pipes with diameters ranging from 121 mm to 273 mm, which are used, among other things, in the oil industry. The company also produces alloy pipes for the energy sector and structural pipes for further machining.

Alchemia SA Holding notes that the decision was made due to the expected loss of Rurexpol’s ability to compete in the market amid the deteriorating situation in the European steel industry, which led to a decrease in demand for the company’s products. In addition, it points to the outdated production technology and high costs of maintaining production activities.

It is also noted that the expected higher economic benefits from the liquidation of the branch’s assets compared to the benefits from maintaining production activities were taken into account.

In 2023, Rurexpol generated PLN 143.5 million in sales revenue, and in 2022 – PLN 173 million, respectively.

According to trade unions, nearly 260 people will lose their jobs by February 2025 due to the liquidation of the branch.

As a reminder, Alchemia is selling a fully functional seamless pipe plant in Poland to Alchemia Walcownia Rur Andrzej (WRA). The asset is being sold by KRUDO Industrial, a global industrial asset monetization company. Walcownia Rur Andrzej was liquidated this year.

As GMK Center reported earlier, steelmakers in Poland reduced steel production by 13.1% in 2023 compared to 2022, to 6.44 million tons. Thus, the country was ranked 22nd in the global steel producer ranking by the WorldSteel Association. Last year, the average monthly steel production in Poland amounted to 536.42 thousand tons, while in 2022 it was 617.25 thousand tons (-13.09% yoy).