Russian troops are closing in on Pokrovsk in eastern Ukraine, jeopardizing production of coking coal needed by Ukraine's steel industry. About this reported the agency Reuters.
The mine, which is located about 10 km west of Pokrovsk, is Ukraine's only source of coal, which is used to produce coke, a key component in steelmaking. Metallurgy is the second most important industry after agriculture that brings currency to Ukraine.
Oleksandr Kalenkov, head of the Association of Ukrainian Metallurgists, warns that the loss of the Pokrovsky Mine may lead to a significant reduction in steel production.
According to him, the production of up to 7,5 million tons of steel in 2024 and 10 million in 2025 was expected, but in the case of the loss of Pokrovsk, this indicator may fall to 2-3 million tons, which is 50 and 70% less.
The problem is exacerbated by the difficulty of importing coal due to military risks and the fact that Ukrainian ports are more suitable for export rather than import. At the same time, according to Kalenkov, the import of coal will increase production costs, which will make Ukrainian steel less competitive.
Alternative sources of coal can be the USA and African countries, including South Africa. Some enterprises, such as ArcelorMittal Kryvyi Rih, are already stocking up in case of supply disruptions.
A source in the steel industry said that producers hope to find alternative sources of coking coal in other regions of Ukraine if the mines in Pokrovsk are seized, but imports will undoubtedly be necessary. This will increase production costs, making Ukrainian steel less competitive.
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