Ukrmetprom Calls for Urgent Action on 25% US Import Duty Exemption for Ukrainian Steel
Ukrmetprom, the industry association representing Ukraine's domestic steel sector, has voiced serious concerns over the US administration’s decision to reintroduce a 25% import duty on Ukrainian steel products. The association is calling on the Ukrainian government to take urgent action to convince the US to extend the exemption, emphasizing the detrimental impact such a move could have on Ukraine’s steel industry and broader economy, especially amid the ongoing conflict with Russia.
A Limited Threat to US Steel Industry
According to Ukrmetprom, the US administration’s decision to impose the 25% duty is unfounded, given that Ukrainian steel products account for less than 1% of total US steel imports. The association highlights that Ukrainian steel’s share of the US market is minimal, with a direct contribution of just 0.81% in 2024, or $258 million. Furthermore, the steel products processed in the EU before reaching the US, such as rebar from Bulgaria, represent only a small fraction of the total US imports.
Despite these figures, the US’s move to reintroduce the tariff could have significant ramifications, particularly for Ukrainian producers and workers. Ukrmetprom argues that Ukrainian steel imports pose no threat to the US steel industry, and the imposition of the duty is seen as an unjustified measure against an ally facing military aggression from Russia.
Impact on Ukraine’s Steel Sector
The Ukrainian steel industry is one of the country’s most vital economic sectors. In 2024, Ukrainian miners and metallurgists contributed 6% to the country’s GDP and nearly 16% of total exports. However, the industry has already suffered considerable losses due to the ongoing war, including a reduction in production capacity. Despite these setbacks, the sector continues to employ over 70,000 people directly at steelmaking plants and over 280,000 in related industries.
Ukrmetprom warns that the reintroduction of the 25% duty would have severe consequences, especially for Metinvest Group, one of Ukraine’s largest steel producers. A reduction in rebar exports from Metinvest’s Bulgarian assets would lead to a significant decline in production, including:
• A 120,000-metric-ton reduction in steel billets at Kamet-steel
• A 180,000-metric-ton decrease in iron ore production
• A 400,000-metric-ton loss in railroad transportation
• A 200,000-metric-ton drop in port transshipment volumes
This would result in a loss of $58 million in foreign exchange earnings and a reduction of UAH 1 billion in tax payments to the Ukrainian state budget.
The Risk to US Consumers and Ukrainian Exports
Ukrmetprom further points out that the imposition of the 25% duty would also harm US consumers, particularly in the oil and gas sector. The US currently imports 30% of its steel pipes, especially seamless OCTG and line pipes, which are vital for the industry. Ukrainian manufacturers, such as Interpipe Niko Tube in Nikopol, provide high-quality pipes produced entirely from domestic materials.
The additional 25% duty could lead to a potential 36% reduction in production at Interpipe Niko Tube, threatening the livelihoods of workers at the plant and devastating the local community in Nikopol, which is situated just 4.7 km from the Russian-occupied Zaporizhzhia Nuclear Power Plant (ZNPP). The negative economic impact on both the local community and Ukraine’s economy would be profound.
The Government's Role in Securing a Solution
Despite the hardships caused by the ongoing conflict, Ukraine’s steel industry remains a cornerstone of the country’s economy. Ukrmetprom urges the Ukrainian government to take all necessary steps to ensure that the US extends the exemption for Ukrainian steel products, including those processed in the EU. The extension, which would last until March 12, 2026, is seen as critical to the stability of Ukraine's steel sector, its foreign currency earnings, and its broader economic recovery.
Ukrmetprom also emphasized that the World Trade Organization is prepared to assist Ukraine in addressing the matter, underscoring the importance of international cooperation to resolve this issue.
Ukraine's First Vice Prime Minister and Minister of Economy, Yulia Svyrydenko, has reiterated that the government is committed to working closely with the US to find a fair solution to the tariffs on steel and aluminum imports. The future of Ukraine’s steel industry depends on securing this exemption, which is vital for maintaining the country’s economic stability during a challenging time.
