Ukraine reduced iron ore exports by 8% m/m in August 2022

In August 2022, Ukrainian mining companies reduced iron ore exports by 7.8% compared to the previous month – to 1.44 million tons. In monetary terms, iron ore exports for this period decreased by 13.2% m/m – to $172.2 million. This is evidenced by the customs statistics‘ data.

On an annual basis, the export of iron ore in August 2022 decreased by 60.9% in physical terms, and by 77.9% in monetary terms.

In January-August 2022, Ukrainian miners sent 20.01 million tons of iron ore abroad – 32.8% less than in the same period of 2021. The revenue of companies from the iron ore export for 8 months of 2022 decreased by 53.8% – to $2.53 billion.

In January-April 2022, the export of Ukrainian iron ore amounted to 12.98 million tons – about 3.2 million tons of iron ore were shipped per month. At the same time, in May-August 2022, 7.03 million tons of iron ore were sent for export – about 1.76 million tons per month.

In 8 months of 2022, Slovakia consumed the most Ukrainian iron ore – 19.8%. Poland is in the second place with 16.5%, and the Czech Republic is in the third place with 15.9%. Thus, since the beginning of the war, European countries have become the main importers of iron ore from Ukraine, displacing China, which was the largest consumer of Ukrainian iron ore at the beginning of 2022.

As GMK Center reported earlier, after the invasion of Russia on the territory of Ukraine, domestic steel companies reduced the export of products to a minimum due to the blockade of sea ports. Steelmakers are looking for ways to ship their products through the railway infrastructure, but due to the influx of cargo, Ukrzaliznytsia and border crossings are unable to cope. In addition, this method of cargo delivery is unprofitable due to the two-fold increase in costs.

Problems with logistics are superimposed on unfavorable market conditions – iron ore prices are falling. As a result, Ukrainian mining and processing plants are forced to completely stop or reduce the iron ore production.

As of August 9, 2022, prices for iron ore in Dalian and Singapore were 720.5 yuan/t ($103.9/t). Iron ore futures increased by 7.4% from the previous week on China’s increased support for its local real estate market. At the same time, Goldman Sachs predicted a drop in the price of iron ore in the third quarter to $70/t.

As GMK Center reported before, in 2021 Ukraine reduced the export of iron ore by 4.2% compared to 2020 – to 44.5 million tons. In monetary terms, the indicator increased by 62.8% y/y – to $6.9 billion.

The main producers of iron ore in Ukraine are Ingulets, Kryvyi Rih, Poltava, Northern, Central, Southern Minings, ArcelorMittal Kryvyi Rih, Sukha Balka Mining, and Zaporizhzhia Iron Ore Plant.