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Metal production in Ukraine
Metal production, in particular iron and steel industry, is the dominant heavy industry in Ukraine. Ukraine is the world's eighth largest producer and third largest exporter of iron and steel (2007).〔Oxford Business Group 2007, p. 100.〕 Ukrainian iron and steel industry accounts for around 2% of worldwide crude steel output,〔''(Global Crude Steel Production in 2009 down 8% on the same 2008 period )''. Iron and Steel Statistics Bureau (London).〕 5% to 6% of the national gross domestic product and 34% of Ukrainian export revenue (2007 data).〔Levine et al., p. 44.1〕 In 2007 it employed 420,000 people – 10% of industrial labor and 2% of the total workforce.〔 It has the highest, by a wide margin, revealed comparative advantage of all branches of the Ukrainian economy.〔RCE=38.5 in 2006 (OECD 2007, p. 108, table 3.1)〕 The industry peaked at 42.8 million tonnes in 2007〔Levine et al., p. 44.2〕 but has been gravely affected by the financial crisis of 2007–2010 and declined to 29.8 million tonnes in 2009.〔
Ukraine possesses substantial natural reserves of iron ore. Ore mining exceeds the demands of domestic steel mills, but export potential is weakened by high extraction costs.〔 The Ukrainian iron and steel industry is concentrated in central (Dnipropetrovsk, Kryvyi Rih, Nikopol), southern (Zaporizhia) and eastern (Donets Basin, Mariupol) regions of Ukraine. There are 14 iron ore mining companies, 15 iron and steel mills, and three ferroalloy plants.〔 Most of iron and steel is produced by large mills with annual capacity of between 4 and 7 million tonnes.〔 As of 2006, 44.6% of Ukrainian steel was produced in obsolescent open hearth furnaces;〔Levine et al., p. 44.3〕 modernization of plant and coping with rising energy costs are the main challenges to the future of Ukrainian steel. The Ukrainian steel industry has been privatized since the 1990s but the coal mines are still owned by the government and experience chronic financial problems.〔Levine et al., p. 44.4.〕
Ukraine is also a significant producer of manganese, manganese ore and manganese ferroalloys and has 75% of the ore reserves of the former CIS.〔 The aluminium industry concentrates in Mykolaiv and Zaporizhia but is limited by energy availability and costs.〔 Ukrainian production of uranium in the Dnipropetrovsk Oblast provides only 30% of domestic demand.〔
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