【Ferro-alloys.com】: CBAM can prevent Ukrainian steelmakers from accumulating income for investments

Europe is becoming a priority export market for ArcelorMittal Kryvyi Rih, but the company will not be able to meet all EU standards immediately after the war ends. This was stated by Mauro Longobardo, CEO of ArcelorMittal Kryvyi Rih, during a roundtable discussion on the EU-Ukraine Economic Partnership in Brussels, Metalurg newspaper reported.

He noted that the company is recovering from the losses of the previous two years, but has not yet reached breakeven.

According to Logobardo, the war has significantly changed the geography of ArcelorMittal Kryvyi Rih’s sales: what the Ukrainian market cannot absorb is exported.

“Europe is now our accessible market and is becoming one of our main potential target markets,” he said.

The CEO of ArcelorMittal Kryvyi Rih emphasized the need for European integration. However, due to the war in Ukraine, the company will not be able to comply with all EU rules immediately after it ends. All strategic investments already include the necessary adjustments to the production route. Investments in key strategic development projects are currently suspended and will resume only after the war ends.

Mauro Longobardo noted that the annual amount of wartime investment required to maintain the company’s operations, including labor protection, is $150-180 million per year.

The CEO of ArcelorMittal Kryvyi Rih also commented on the introduction of the European Carbon BorderAdjustment Mechanism (CBAM) in January 2026.

“This will undermine our company’s ability to survive, as it threatens to remove the EU market from the list of potential target markets. Without the possibility of supplying to the European market, we will not be able to accumulate revenues sufficient to fulfill our investment program,” he said.

According to Mauro Longobardo, Ukrainian steel companies should be temporarily exempted from financial obligations under the CBAM while maintaining reporting.

The company’s CEO emphasized the need for European support and policy adjustments to gradually bring Ukraine closer to EU standards.

He also listed the challenges the company faced in wartime. In addition to restoring and rebuilding the disrupted logistics and changing sales geography, the Kryvyi Rih plant faced the loss and restoration of water supply after the Kakhovka dam was blown up, and operating under frequent power outages, which led to damage and disruption of production equipment.

Another major problem is the constant outflow of labor, as about 3,000 employees of ArcelorMittal Kryvyi Rih serve in the Ukrainian Armed Forces. However, the company avoids layoffs by choosing to invest in people, keeping staff on the payroll while waiting for the business to resume.

As Mauro Longobardo said earlier, high electricity prices in Ukraine, unfavorable market conditions, and logistics costs prevent ArcelorMittal Kryvyi Rih from increasing production.

• [Editor:Alakay]