Forced pause: what does the shutdown of blooming at Ukraine’s largest metallurgical plant mean?
26 January 21:53
The Kryvyi Rih Iron and Steel Works ArcelorMittal Kryvyi Rih (AMKR) has announced that it will be forced to shut down its blooming mill in the second quarter of 2026, according to "Komersant Ukrainian".
The company calls this decision difficult, but one that is necessitated by a combination of economic and market factors in the context of full-scale war.
What led to the decision
The company cites the introduction of the Carbon Border Adjustment Mechanism (CBAM ) on January 1, 2026, without exceptions or a transition period for Ukrainian producers, as the key factor.
The plant notes that this effectively means the loss of the European market for a significant portion of Ukrainian metallurgical products.
After the start of full-scale war, the company made significant efforts to reorient sales to the EU market, which in fact had to be built from scratch. The introduction of CBAM without taking into account the realities of war, according to the company’s assessment, has negated these efforts.
Why blooming
The blooming shop of the rolling department produces billets for small-section and wire mills. In the absence of stable demand from the EU, the plant does not have sufficient orders to ensure the economically viable operation of this division, both now and in the medium term.
The energy factor
The company cites the high cost of electricity in Ukraine as an additional significant factor.
Due to constant attacks on energy infrastructure, power shortages, and the need to import electricity at high prices, the cost of production has risen sharply. According to the company, since the start of the full-scale war, the price of electricity for industrial consumers has more than doubled, making the work of the blooming mill economically unprofitable.
What will happen to the employees
The company assures that no layoffs are planned. All employees of the blooming shop will be offered employment in other divisions of the plant with the possibility of retraining at the expense of the enterprise.
Financial and production context
Despite an increase in production in 2025 compared to 2024:
- steel — up to 1.69 million tons (2.3%),
- cast iron — up to 2.53 million tons (16.9%),
- rolled products — up to 1.56 million tons (1.1%),
- coke — up to 1.46 million tons (16.4%),
the financial situation of the company remains difficult. In the first half of 2025, AMKR’s net loss increased by 11.9% and amounted to UAH 4.22 billion.
What is known about ArcelorMittal
ArcelorMittal Kryvyi Rih is Ukraine’s largest steel producer with a full production cycle and a design capacity of over 6 million tons of steel per year.
The decision to shut down a separate unit at such an enterprise may indicate systemic risks for the entire Ukrainian metallurgical industry, particularly the export-oriented sector, in the context of CBAM and energy restrictions.
