ArcelorMittal Krivoi Rog closed 2022 with big losses, is surviving on $600 mln from parent co - CEO

MOSCOW. March 24 (Interfax) -Steel producer ArcelorMittal Krivoi Rog (AMKR), which ended 2022 with big losses, continues to operate thanks to financial assistance from ArcelorMittal Corporation, Ukrainian media reported, citing Mauro Longobardo, AMKR's general director.

"The financial situation last year was very challenging, we had a significant net loss, but we received substantial financial assistance from ArcelorMittal Corporation. It amounted to over $600 million. These funds were needed to continue paying wages to employees and continue to operate, despite the difficulties with buying raw materials, their high cost and other problems," he told the Metallurg in-house newspaper.

He said that despite the difficulties, "we managed to retain staff - we did not have any layoffs, not a single employee was let go."

The plant last year worked at 20-25% of its capacity, and it is facing additional losses from logistics problems. "Here we need to be as flexible as possible now as well. We decide each week which type of product we should sell to minimize costs. We hope that this year the situation will improve," Longobardo said.

He said AMKR was currently planning to increase production in order to ultimately reach at least the 2021 level.

Planned capex is $130 million in 2023. The main project will be the construction of the III Map tailings dump. Construction of the IV Map and Mirolyubovskoye tailings dumps should be completed. Special attention will be paid to the construction of a pelletizing plant.

Relining of the No. 9 blast furnace and its modernization will continue. Other plans include increasing production in the converter shop, and improving the operation of the continuous caster, coke production and No.2 sinter plant.

AMKR reduced steel roll output 76.7% in 2022 to 1.1 million tonnes. Crude steel production fell 71.2% to 1.2 million tonnes and pig iron 71% to 1.6 million tonnes. Coke production decreased 63%, to 1 million tonnes, iron ore 56.5%, to 11.6 million tonnes and iron ore concentrate also 56.5%, to 4.2 million tonnes.

ArcelorMittal Krivoi Rog is the largest producer of rolled steel in Ukraine. It specializes in the production of long products, in particular rebar and wire rod.