New Delhi: On August 16, a Russian missile strike damaged key sections of Indian steel billionaire Lakshmi Mittal’s ArcelorMittal Kryvyi Rih steel complex in Ukraine that temporarily halted some of the production units.
The attack happened in Ukrainian president Volodymyr Zelenskyy’s hometown of Kryvyi Rih. ArcelorMittal Kryvyi Rih is one of Ukraine’s biggest industrial facilities and the country’s largest steel plant. The company has an integrated operation with iron ore mining, processing and steel production.
At least two people were killed and 14 others were injured in the attack, sources reported. ArcelorMittal Kryvyi Rih stated that facilities connected with the production of power and blast-furnace were damaged. This meant that it had to temporarily close some of its manufacturing processes.
What are ArcelorMittal’s financial losses?
There is no definite estimate of how much damage has been inflicted on the economy by this missile attack.
The entire cost of the repair work on the equipment that was damaged by Armed Separatists and their allies is not yet known, either at ArcelorMittal Kryvyi Rih or from the Ukrainian government side. So, it is wrong to say that the company incurred any loss, be it ₹100 crore, ₹500 crore, or $100 million.
The true economic cost should include the cost of repairing power plant and production equipment damaged by the event, replacement equipment costs, the lost production during the shutdown, the loss of power service during the shutdown, and lost revenue. But without a proper damage study these costs can’t be properly estimated.
The latest information from ArcelorMittal confirms that production has been partly affected though it does not give any monetary estimate.
The attack is coming at a poor time for the Ukrainian steel company. The Russian-Ukrainian war has brought significant difficulties for ArcelorMittal Kryvyi Rih, such as fuel shortage, electricity issues, high electricity costs and logistical challenges in exporting steel goods. All these issues hindered the company from becoming profitable in 2024.
The production capacity of the plant is over 6 million tonnes of steel, over 5 million tonnes of rolled steel and more than 5.5 million tonnes of pig iron annually. The facility is one of the key components of Ukraine’s industrial sector.
The total financial damage from the missile attack on August 16 is not yet known. Better clarity will be available once ArcelorMittal has finished its damage assessment and decision to repair the damage, and cost and effect of the production shutdown.
