Ukrainian metallurgy remains one of the key sectors of the country's economy

Ukrainian metallurgy remains one of the key sectors of the country's economy, generating a significant portion of foreign exchange earnings, tax payments, and jobs, even in conditions of full-scale war. For decades, the industry has been the foundation of macroeconomic stability and an important driver of the development of related sectors.

Before the invasion, the mining and metallurgical complex provided more than 10% of GDP and about a third of Ukraine's commodity exports. In 2021, the contribution of MMC to the economy amounted to 10.3% of GDP, taking into account related industries and employee consumer spending. The share of metallurgy in the export of goods then reached almost 33%, which provided the country with $22.2 billion in foreign exchange earnings. Enterprises of the industry paid about $3.5 billion in taxes and fees.

Metallurgy actually functioned as an ecosystem. Steel provided the needs of engineering, construction, energy and defense industries. One employee in the industry created jobs for four more people in related sectors, and every thirteenth employee in Ukraine was associated with metallurgy. The industry played a city-forming role in Zaporizhia, Dnipro, Kryvyi Rih and Mariupol: Azovstal employed over 10 thousand people, Ilyich MMK - about 14 thousand, ArcelorMittal Kryvyi Rih - almost 20 thousand.

After the war, metallurgy suffered serious losses. Enterprises in Mariupol, which produced about 40% of steel, ended up in the occupied territory. This led to a reduction in pig iron exports by 40% and rolled steel - by 30%. At the end of 2024, the industry's contribution to GDP decreased to 7.2%, and exports of mining and metallurgical products to $6.4 billion, or 15.4% of merchandise exports. Tax revenues from MMCs decreased to about $1 billion.

Despite the losses, metallurgical enterprises continue to invest. In 2024, capital investments amounted to $650 million, which was 18.3% of all industrial investments and exceeded the level of 2023 by 8.3%. In particular, in 2025, Metinvest Group directed funds to energy independence projects, in particular, the construction of gas-fired power plants for stable operation during blackouts.

Metallurgy is today considered a material base for post-war reconstruction - from infrastructure reconstruction to housing construction. The industry meets the needs of the defense-industrial complex, in particular in the production of armored elements, protective structures and engineering structures. The EU remains the main market for Ukrainian steel exports, where about 64% of production goes. At the same time, the Carbon Border Adjustment Mechanism (CBAM) will come into force in the European Union from 2026, which creates additional barriers to exports.

According to forecasts, in 2026, steel production in Ukraine may increase to 6.7–7 million tons compared to 6.2 million tons in 10 months of 2025. At the same time, about 55% of production will continue to be exported due to limited domestic demand. Among the key restraining factors, experts name unstable energy supply, high electricity tariffs, logistics costs, shortage of qualified personnel and military risks.

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