Speaking to Reuters, CEO Luca Zanotti said that the move contradicts the trade exemptions previously granted to Ukraine by the European Union.
Starting from July 1, the European Union plans to reduce duty-free steel import quotas on a country-by-country basis and impose tariffs ranging from 25% to 50% when quotas are exceeded. While EU officials state that these measures are intended to protect the European steel industry against global overcapacity, some members of parliament argue that higher quotas should be maintained for Ukraine.
However, Zanotti said that despite the EU granting Ukraine a three-year exemption valid until June 2028, the new regulations introduce country-specific restrictions. Speaking to Reuters in Kyiv, Zanotti said, “On the one hand, they say they support Ukraine; on the other hand, they are taking steps that will harm one of the country’s most important economic engines, namely its industry.”
The European Commission and the EU delegation in Kyiv did not respond to Reuters’ request for comment on the matter.
Zanotti emphasized that steel production in Ukraine has fallen by as much as 80% due to the war and warned that the new restrictions could lead to economic losses that would be difficult to reverse. He noted that the country is facing serious challenges in labor availability and energy supply, adding, “We are facing the highest electricity costs in Europe. Ukraine’s steel industry is not a threat to Europe.”
Interpipe, owned by Ukrainian businessman Viktor Pinchuk, produces and exports steel pipes and railway products. According to industry representatives, a potential decline in steel exports could result in annual foreign currency revenue losses of at least $1.2 billion for the country, while tax revenues could also decrease by approximately UAH 17.5 billion.
Before the war, the steel sector accounted for nearly one-third of Ukraine’s total exports and generated more than $20 billion in foreign currency earnings annually. However, following Russia’s invasion, the loss of industrial facilities, particularly in the eastern regions, significantly reduced production capacity. According to OECD data, Ukraine’s annual steel production capacity had fallen to approximately 8 million tons by March 2026, representing a decline of around 80% compared to pre-war levels.
One of Interpipe’s key production facilities is located in the city of Nikopol, approximately five kilometers from the front line. Zanotti stated that during his most recent visit to the area, he heard multiple explosions within a short period of time, adding that despite all the challenges, the facility continues its operations.
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