Increasing the Production of Pipes in Ukraine

by Olha Povaliaieva
Thursday, January 21, 2022
Increasing the Production of Pipes in Ukraine

Ukrainian enterprise "Ukrtruboprom," which manufactures pipes, has increased its production by 32.6% as of the end of 2021

Trubоstal and Interpipe Nicо Tube were able tо increase pipe production by 15%, Centravis rеduced pipe production by 2.2%, and electric pipe maker Interpipe NTZ increased output by 24.3%.

Ukrtruboprom was able to increase production up to 55.8% in December 2021.

"The situation in fоreign markets over the past year has been favоrable for Ukrainian pipe producers. These are mainly оil and gas products. High prices for hydrocarbons have formed an active demand for OCTG from" rel="dofollow">energy companies, – said CEO of Ukrtruboprom Heorhii Polskyii. – At the same time, the demand for linear pipes remained stable during the year due to increased activity in the construction sector. Production of machine-building pipes has also increased due to delayed post-coronavirus demand''.

The decline in production of welded pipe manufacturers is associated with a disastrous first half of the year when ultra-high prices for strips made the production of welding economically unviable. Nevertheless, in the second half of the year, it was possible to compensate for this decline partially. 

Also, in 2021, the shortage of scrap metal as the primary raw material has become more acute for seamless pipe manufacturers. Ukrtruboprom called on the authorities to introduce a temporary moratorium on scrap export. Still, the situation was only normalized in December after increasing export duty on scrap metal.

“At the same time, a new challenge has appeared for Ukrainian pipe makers since the 4th quarter. Abnormally high prices for natural gas have led to the fact that the production of pipes of a certain range has lost economic viability. This risk to the industry is expected to continue throughout 2022," Polskyii predicts.

Also, he added, Ukrainian pipe plants in 2021 continued to work in conditions of severe protectionism.

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