The current situation in Ukraine is having a direct impact on the European steel market for a number of reasons. As such we see it as crucial that we help customer’s to understand the situation, the impacts it is having on the steel market, and what we are doing to help customer’s plan for business continuity.
To understand why the Russian invasion of Ukraine is having a profound effect on the market, below are some key factors behind current steel shortages:
• Ukraine is the 12th largest steel producer in the world (21 million tonnes per annum), 80% of this is exported.
• Ukraine is also the 5th largest supplier of iron ore products in the world.
• Russia is the second biggest steel exporter in the world after China.
• Ukrainian slabs account for approximately 40% of the total slabs re-rolled in Italy every year, a key supplier to the European market, alongside high percentages for other European countries.
• Mariupol is home to two of Ukraine’s largest steel mills owned by Metinvest, both of which have been targeted and have halted production causing an immediate reduction in steel output to the market.
How does this affect us?
This significant reduction in steel availability coupled with substantial supply chain disruption, is causing the price of steel to rise considerably. UK Steel stockholder prices have increased by 60-70% in the past 7-10 days and most European Steel Mills are not offering on new orders at present. Prices are likely to increase further over the next 3 – 6 months.
What is The Laser Cutting Company doing about it?
The Ukraine crisis aside as a business we keep a constant eye on the European steel and metal markets to ensure we offer the most accurate and current market rates. We continue to do so by the hour and have forward ordered considerable stocks to ensure we can offer availability and keep production moving for our customers.
We see it as crucial that we are able to offer complete transparency for our customers to aid in business planning through the developing situation in Ukraine.
If you require any further updates or information we would be more than happy to help so please feel free to contact us to discuss your requirements going forward.