TonThe Azovstal steel plant in Mariupol has become one of the symbols of the brutality of the Russian invasion of Ukraine.Soldiers held out for weeks in tunnels, warehouses and cooling blast furnaces in Warren as they and hundreds of civilians who took refuge with them were surrounded and killed finally forced to surrender.
The plant, which produces 40 percent of Ukraine’s entire steel output, is a key asset for Metinvest, the country’s largest pre-war employer. According to its chief executive Yuriy Ryzhenkov, now its owners play an important role in the parallel battle to maintain the economy through other factories outside of its occupied territories.
“War effort is not only what you provide to the military, but how [the] The economy functions,” the Metinvest boss said via video link from a company office in Lviv, western Ukraine. “So the better the economy works, the better the country can fight. In our opinion, in my personal opinion, the people who work in our steel mills are now as important to the victory of Ukraine as the soldiers on the front. “
When Ryzhenkov first heard Russian weapons signal the start of an invasion in the capital, Kyiv, he was shocked that Vladimir Putin’s regime would wage open war. The company has since adjusted to operate in a war zone, but at least 153 Metinvest employees have been killed in the fighting.
In addition to keeping money flowing through the economy, the metals and mining conglomerate has a direct role in the war, shipping steel for 1,500 bulletproof vests to Ukraine’s armed forces every week and importing drones, night-vision headsets and Military equipment such as helmets.
For a major shareholder – Ukraine’s richest man Rinat Akhmetov – recently at 11 Quoted by President Volodymyr Zelenskiy, as targets recruited to support a possible coup attempt. Zelensky said Akhmetov was not involved in the conspiracy, and the oligarch said the move to woo him was an “absolute lie.”
Akhmetov, who has ties to the UK, including Past property investments in Londonkeep Very powerful under successive Ukrainian governmentsPro-Moscow and anti-Moscow, and backing the current government, saying his allegiance is only to Ukraine and that Russian soldiers should be punished, adding that he will use his wealth to rebuild the country.
Ryzhenkov said he was in regular contact with Akhmetov and the government in Kyiv, but insisted the company was not involved in “political issues” with its owners. “We are working for a victory in Ukraine.”
Before the war, Azovstal employed 35,000 people and produced 9.5 million tonnes of steel a year – two-thirds of Metinvest’s output. It all stopped. Given the number of people killed, it can be unpleasant to talk about everyday matters. Ryzhenkov raised an eyebrow when asked what Metinvest’s production would be this year, but replied that it would be down at least 60% compared to 2021.
However, “market help” in the form of firmer steel prices softened the blow to the company’s finances, which were in relatively good shape with high cash balances before the invasion began in February anyway. Ryzhenkov said the company’s focus around Mariupol has now shifted to providing temporary food and shelter for more than half of the workforce who have left the city. Metinvest operates a “humanitarian center” in the southeastern city of Zaporozhye, providing medical and psychological help to adults and children.
However, he estimates that 50,000 of its employees are still working in the country. The other two blast furnaces in Zaporozhye and the northern city of Kamensk are operating at about 50% and 60% capacity, respectively, with most of their production going to the European market or ports. The capacity of iron ore mining facilities in Ukraine is about 35% to 40%, and the capacity of coking coal mines is about 75%.
Carrying out humanitarian operations with one of the country’s largest businesses in wartime is not a problem for most CEOs, but Metinvest has some preparations.With the support of the Kremlin, it was forced to move its headquarters from Donetsk Separatists first invade eastern Ukraine 2014 and, where possible, more of a shift to the European market and non-Russian fuel suppliers. Then, amid the pandemic, it implemented remote work for all eligible employees.
The problem is getting the goods to the customer. “The flow of goods has slowed markedly,” Ryzhenkov said. He suggested that the Ukrainian and EU governments could step in and subsidize the transport.The food export situation is particularly urgent, not only for Ukrainians, but also for poor consumers of imported wheat all around the world.
“It’s a big problem,” he said. “Logistics is a key bottleneck for many Ukrainian businesses right now. The government is trying to restart the economy, but it will be very difficult if these logistical difficulties are not addressed. We are concerned about the speed at which these bottlenecks are ‘de-bottlenecked’.” Reopening Mali The Black Sea ports of Upol and Odessa are “key to restarting the economy”.
Efforts to increase exports by rail have been complicated by Ukraine and Poland using different rail gauges, so Metinvest has established reloading centers in Poland and Slovakia to deliver products faster on European-compatible trains. There is a limit to what the road can take, and Ukraine is struggling with a severe lack of fuel. Ryzhenkov said the government’s efforts to cap prices have instead exacerbated shortages.
From the filtered images of Azostar’s destruction— Some of them are truly extraordinary – There doesn’t seem to be much left, but Metinvest bosses have warned the pictures could be “misleading”, with many showing less important ancillary devices rather than critical blast furnaces.
The brutality of the Mariupol campaign led to Russia’s international isolation. (Ryzhenkov praised Boris Johnson’s support for Ukraine’s victory, saying the British prime minister was sending a “very strong message, we could hear it and feel it.”) Putin’s apparent aim was to control Ukraine, but the invasion prompted Metinvest and many other key parts of the economy decisively away from Moscow.
The company is even considering options to produce more steel in the EU using Ukrainian goods, and Ryzhenkov hopes Russian steel exports will be the target of sanctions.
He said any form of ties with Russia was out of the question for the “foreseeable future” and Metinvest would “absolutely not” operate in Russian-controlled territory. “until [the] Russian regime change, I don’t know how to recover. “