Metals Companies Request Railways Suspend New Tariffs

The Ukrainian Association of Ferrous Metal Companies issued a complaint that a new hike in railway tariffs exposes their industry to a much greater transportation cost increase than other industries. While the tariffs will rise 50% on average, the transportation prices for ferroalloy producers grow 200%, 163.2% for coke, and 80.8% for iron ore producers. Members of the association claim that the high tariffs could drive major companies to a standstill, disrupt investment projects, freeze investment programs, and cause lay-offs. Concorde Capital: The final version of tariffs for metals related industries was lower than initially projected. Previously, it was proposed that coke transportation tariffs would grow 222% and iron ore shipping tariffs would increase by 176.5%. The increase in railway tariffs is a serious detriment to Ukrainian business groups involved in metallurgy. It is not clear, however, how the tariff increase will be allocated among separate producers of raw materials for metallurgy and traders who service domestic and export supplies of raw materials and finished goods in the metals industry. The outcome will be price rise for all sorts of metallurgical products and worsening of financial results for metallurgical downstream.