Despite the ongoing full-scale war with Russia lasting over 2.5 years, Ukrainian businesses are strongly supporting the national economy. Through investments in equipment, technology, and human resources, companies are striving not only to achieve business success, but also to support a better future for Ukraine.
Before the outbreak of the war, the annual accumulation of gross fixed capital in Ukraine stood at about 700 billion hryvnias (almost 680 million zł). The State Statistics Service of Ukraine (PSSU) currently does not provide new data, but it is estimated that this level still amounts to several hundred billion hryvnias despite the ongoing conflict and economic downturn. After making cuts in non-key expenditures at the beginning of the war, and after stabilizing operational activities, some companies have been systematically increasing investments since the end of 2022 to support the country’s development in striving for a rapid economic recovery.
Initial losses did not prevent investment
The industry is one of the sectors of the Ukrainian economy that suffered heavily during the war. Before the war began, it accounted for 21% of Ukrainian GDP, also providing a huge number of jobs.
Among the companies representing this sector, which suffered significant losses as a result of the war, is Metinvest – a group of steel and mining companies. Despite severe losses caused by occupation, destruction, and difficulties in carrying out exports, the Group continues to invest heavily. The total value of investments exceeds $300 million annually, including joint venture companies.
It is the largest taxpayer in the industry. In 2023, the Group, including affiliated companies and joint ventures, paid 14.6 billion UAH in taxes and customs duties to budgets at all levels in Ukraine. In the first quarter of the current year, it increased its taxes and customs duties to budgets at all levels in the country to 4.2 billion UAH, representing an increase of about 70%.
Modernization and new jobs
Although the main strategic projects of Metinvest were halted, the Group quickly responds to changes in the business environment and adjusts its investment program to maintain production volumes. Metinvest primarily invests in existing facilities that require modernization. Among the more important projects of this type recently implemented by the Group was the launch of new faces for the extraction of coking coal in block 10 of the mine in the Pokrovske Coal Group.
Last year, Zaporizhstal and Kamet Steel carried out major repairs of blast furnaces. In addition, Zaporizhstal modernized the equipment of its rolling mills, and Kamet Steel modernized coke oven batteries. Over the past two years, the Group has invested in the modernization of these two enterprises 23 billion hryvnias (more than 2.2 billion zlotys).
The Group’s market position is strengthened by targeted, well-fitted investments. The modernization of the roasting machine in the pellet production hall at Northern Iron Ore last year enabled the start of production of homogeneous pellets with an iron content of 65%. Thanks to this, the entire enterprise maintained its competitive position on the European iron ore market.
Green transformation strategy – Metinvest bets on green steel
The Metinvest Group fully understands that some strategic projects need to be deferred until the end of the war. However, this does not mean giving up strategic thinking about business. Since Metinvest is an international group, it can still help develop its Ukrainian assets by investing in clean production. The construction of a green steel mill in Italy with an annual capacity of about 3 million tons will increase the performance of Metinvest’s Ukrainian mining and processing plants in the long run, since they can no longer sell their products on the domestic market after capturing steel mills in Mariupol. Metinvest and its partners will build the plant within three to four years, using up to $2 billion in loans and partner funds.
The Green Steel Production Transition Strategy of the Metinvest Group was developed long before the war. It included plans to convert blast furnaces in steelmaking plants to DRI (direct reduced iron) technology. This process requires improved pellets as raw materials. At the start of the war, the Group’s Central Iron Ore successfully tested the production of such DRI pellets. Metinvest plans a wide-ranging green transformation of its Ukrainian assets – including mining and processing plants, Kamet Steel and Zaporizhstal – worth about $9 billion over five to ten years after the war ends. This will require external financing and will be a new card in the history of the steel industry.
This year, Metinvest plans to invest $320 million in equipment and jobs and about $350 million in operating investments. The main areas of interest to the Group are repairs of blast furnaces and sinter machines, maintenance of mining and processing plant equipment.
For consistent, thoughtful, and future-oriented business and investment development in the country, the Metinvest Group has been recognized by the Ukrainian information portal dsnews.ua and included in the list of the top ten investors in Ukraine. Moreover, according to the ranking prepared by the New Voice (nv.ua) portal and Odgers Berndtson – an international company specializing in executive assessment, Metinvest ranked among the top 50 employers in the steel industry in Ukraine in 2024.
Source: https://managerplus.pl/biznes-w-obliczu-wyzwan-metinvest-inwesuje-na-ukrainie-mimo-trwajacej-wojny-35983
