Kyiv: The European Union's plan to slash steel imports will hit Ukraine's war-battered industry and goes against an exemption by the bloc as the country fights Russia's invasion, the CEO of Interpipe, one of Ukraine's biggest industrial companies, said.
The EU announced this month it would set reduced import quotas of duty-free steel per country by July 1 and apply a 50% tariff to any additional volumes, up from 25%. Lawmakers say the measures are designed to shield the bloc's steel sector from global overproduction though some have expressed support for maintaining higher volumes for Ukraine.
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Interpipe CEO Luca Zanotti said that Ukrainian steel would be subject to country-specific curbs despite the fact that less than a year ago the EU had granted it an exemption for three years until June 2028.
"They cannot, on the one hand, say, we're going to support Ukraine, and on the other hand, damage the industrial sector, which is a very important engine of this country," he told Reuters at the company's office in central Kyiv.
The European Commission in Brussels and EU representatives in Kyiv did not immediately respond to Reuters' requests for comment.
Steel production in Ukraine is already down by as much as 80% due to the war and the European Union curbs could lead to irreversible economic setbacks, Zanotti said.
"We have a shortage of manpower. We have a shortage of electricity. We have the highest electricity cost, for sure, in Europe," he said. "Ukraine's steel industry is not a threat for Europe." Interpipe, owned by Viktor Pinchuk - one of Ukraine's richest people - is a manufacturer and exporter of steel pipes and railway products.
SQUEEZE ON EXPORTS AND REVENUE
The Association of Ukrainian Mining and Metallurgical Sector estimates that the fall in steel exports could lead to a loss of at least $1.2 billion in annual foreign currency revenue and cut tax receipts by about 17.5 billion hryvnias ($398 million). Before the war, Ukraine's steel sector accounted for roughly a third of exports, generating more than $20 billion a year in hard currency revenue. It lost some of its major plants when Russian troops advanced in the eastern Donetsk region.
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An OECD report showed Ukraine's annual steelmaking capacity was about 8 million metric tons in March 2026 - a reduction of around 80% from levels before Russia's invasion in 2022. One of Interpipe's plants is located in the city of Nikopol, around 5 km (3.1 miles) from the front line. "This time, I was there, and I could hear pretty close at least three explosions in six hours. The plant is working," he said, referring to his latest trip to the city, where Interpipe employs about 2,500 people.
