Plate and HRC Steel Production Strained as Factories Shut Down

Metinvest, the Ukrainian steel production and mining group, recently began the process of restarting several of their Italian flats rolling mills. The factories had been offline for scheduled maintenance throughout May. And with global supplies strained, both Metinvest and the market are welcoming the much-needed additional steel production.

Metinvest’s plate and hot rolled coil mill Ferriera Valsider, resumed operations in early July. Meanwhile, their plate roller mill, Trametal, has been back online since June. In an end-of-month update on its operations, Metinvest provided insight into how the factories’ restarting might affect the marketplace. They also outlined plans for future expansion in the face of the ongoing war.

steel production

Ferriera Valsider and Trametal Capacities for Steel Production

According to the June 30th statement, Ferriera Valsider, located in northeast Italy’s Veneto region, can roll 750,000 metric tons per year of hot rolled coil in 1.8-20mm gauges. The site can also produce up to 1,570mm widths for construction if needed.


Valsider also has 500,000 metric tons per year capacity to produce quarto plate in 12-200mm gauges. On top of that, the site can also facilitate a 3,000mm maximum width. Applications for that product include boiler and pressure vessels, shipbuilding, construction, and feedstock for pipes.


Metinvest’s Trametal plant rests in the Friuli Venezia Giulia region, also located in Northeastern Italy. According to the tech report, that facility can roll 600,000 metric tons of quarto plate in 4-150mm gauges per year.


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Plant Maintenance Cycles Were Moved Up From August

Both the Valsider and Trametal plants shut down for maintenance in May. According to a report by the Interfax-Ukraine news agency on May 18.


Indeed, official offers on hot rolled coil in northern Europe were €900 ($940) per metric ton exw in late June. This was down from €1,010-1,050 ($1,050-1,095), according to our trading source. This meant that buyers seeking larger tonnages could easily reach €850 ($885) against the official offers.

The War in Ukraine a Major Factor in Steel Production

Though energy costs have risen sharply against market demand, the need to source slab for rolling from elsewhere besides Ukrainian plant Azovstal is forcing Metinvest’s hand on many decisions. Most will remember that the Mariupol-based Azovstal plant was supplying the Italian rolling assets with slab before Russia invaded Ukraine on Feb. 24.


However, in a major news story, the plant came under heavy fire back in March. Soon after, it was also the site of an 82-day siege by Russian forces and those from the breakaway Donetsk People’s Republic (DNR). As forces attacked the port city, both Azovstal and the adjacent Ilyich Iron & Steel sustained heavy damage.

However, due to the ongoing conflict, the extent of the damage remains unclear, as does any hope of the plants coming back online. “There is no plan to restart while the area is under Russian occupation,” our inside analyst added.


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Metinvest Looking to Expand Further in the Short Term

Recently, Metinvest announced they were considering the construction of a new steelmaking plant in Bulgaria to bolster steel production. According to the Ukrainaian publication Ukrrudprom, the group wants to harness iron ore from its sites in the Dnipropetrovsk region.
“But, again, in order to do this, you need to be sure that we will be able to supply ore from Kriviy Rih to these countries,” said CEO Yuriy Ryzhenkov. “This is possible, but not guaranteed. We are considering different scenarios and technology strategies.”
Meanwhile, Metinvest continues to produce iron ore at its Central GOK at reduced capacity utilization. The group also plans to suspend production at the Ingulets and Northern GOKs from July 1 into the middle of the month. Those sites are in or near Kriviy Rih, in the Ukrainian part of the Dnipropetrovsk region.


Ryzhenkov did not give any indication as to what a prospective plant would cast or roll or what kind of financial commitment it would entail. However, our inside analyst believes slab to be the most likely variant. They also stated that the prospective plant’s site would likely be close to Metinvest’s longs roller Promet Steel, which lies about 25 kilometers from the port city of Burgas.

Planning Steel Production Around the Russian Invasion

Promet Steel also plans to restart operations in mid-July. This, after difficulties in acquiring needed billets from Ukrainian asset Kamet Steel prompted the Bulgarian plant to suspend operations in mid-June

“There have been changes in logistical routes and supply chains in the country, as well as high transportation costs to deliver goods to end customers,” a Metinvest representative stated. “Stocks of iron ore and steel products have accumulated throughout the group’s supply chain, while there have been significant delays in Metinvest’s goods crossing the border with the European Union.”


Kamet Steel, on the other hand, is in Kamianske. This is near Dnipro, a city largely unaffected by Russia’s military invasion of Ukraine. The plant sits on the banks of the river of the same name, which exits into the Black Sea at Kherson, a city now under Russian control.
Metinvest halted one of Kamets Steel’s three blast furnaces in April, leaving only one operating at present. When fully operational, Kamet can pour up to 3.5 million metric tons per year of crude steel. It then casts the product into square and round billet for commercial sale or for rolling into 1.8 million metric tons of long products.


Promet rolls 800,000 metric tons per year of rebar in 8-40mm diameters on Mill 3000, and can also produce merchant bar, including angles, flats, and rounds.


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