‘If nothing is done, it’s almost inevitable’: Ukraine’s Yuriy Ryzhenkov on why steelmaking is on the brink of collapse as Russian bombing intensifies

Metinvest CEO Yuriy Ryzhenkov says Russian attacks and EU steel quotas threaten the viability of Ukrainian steelmaking; the quota for Ukraine was cut 60% from July 2026, potentially reducing exports to the EU by 1.3 million metric tons annually. From 2021 to 2025, Ukraine’s steel production fell from 21 million to 7.4 million metric tons, steel export value from $22 billion to $6 billion, and tax revenue from $3.5 billion to $870 million. Ryzhenkov says that without full access to the European market and investment, the end of steelmaking in Ukraine is “almost inevitable.”

Analysis

The main market transmission is not simply “less Ukrainian steel, higher EU steel prices.” If the reduced quota binds, Ukrainian supply is displaced at the margin, but alternative exporters can capture the quota space or sell into other markets; the price benefit to EU mills may therefore be smaller than the volume headline implies. The clearest potential beneficiaries are EU producers competing in the same product categories, including ArcelorMittal, Salzgitter and voestalpine, subject to their product mix and quota exposure. Metinvest’s risk is more structural: disrupted operations and constrained market access raise the chance that deferred maintenance and investment become permanent capacity losses, reducing Ukraine’s future export option even if policy improves.

Near term, quota allocation and any Ukraine-specific exemption are the catalysts; tariff protection alone is not evidence of improved EU mill margins. Over 1–3 months, track EU import volumes by product, quota utilization and steel spreads, alongside negotiations. Over 6–18 months, persistent attacks, energy and rail disruption, and absent long-term offtake could make capacity restarts uneconomic. A key contrarian point: the tariff change may be less important than the war damage itself, and quota relief would not restore the high utilization needed for viable steelmaking. The thesis weakens if the quota remains unfilled, displaced imports are readily replaced without tighter EU pricing, or an exemption restores Ukrainian access.

Key Decisions for Investors

• Do not trade the headline as an outright EU steel-margin call. First verify which product quotas bind, utilization rates, and whether imports from other origins are replacing Ukrainian volumes.
• Watch ArcelorMittal, Salzgitter and voestalpine as potential relative beneficiaries; consider a long-versus-industrials expression only if quota data confirm reduced import competition and EU steel spreads strengthen. Exit the thesis if quotas are unfilled or spreads fail to respond.
• Treat Metinvest as a high-risk, event-driven exposure rather than a clean tariff trade; verify its current operating capacity, export routes, energy availability and financing before taking any position. An EU carve-out is a catalyst, but renewed facility or logistics disruption would overwhelm it.