Ukrainian Railways to Sell Scrap and Crushed Stone to Boost Local Industry

Ukrainian Railways to Sell Scrap and Crushed Stone to Boost Local Industry

The Ukrainian government has made a key decision to support the supply of raw materials to local industries. The Cabinet of Ministers simplified the process for Ukrainian Railways (UZ) to sell its accumulated scrap and crushed stone materials. This step aims to ensure a steady flow of essential raw materials, especially to the steel sector.

New Rules for Property Disposal

Under the new regulations, UZ can now sell property, including scrap metal, without needing government approval. However, this is only if the property’s book value is under UAH 500 million. This allows UZ to sell over 218.6 thousand tons of ferrous scrap, worth UAH 1.6 billion, and 3.8 thousand tons of non-ferrous scrap, worth UAH 233.4 million. The sales will improve the company’s financial position and supply raw materials to local industries.

Importance of Scrap Sales for Ukraine’s Industry

Selling scrap metal has benefits for both UZ and Ukraine’s steel industry. Decommissioned railcars and outdated equipment will no longer accumulate on the tracks, improving traffic safety. The sale of scrap will also supply Ukrainian industries with the raw materials they need, which have been scarce due to previous regulatory delays. UZ will be able to dispose of surplus materials and help local industries, particularly steelmakers.

Impact on Ukrainian Steel Industry

UZ previously struggled to sell scrap materials due to slow approval processes. As a result, a backlog of scrap has built up, with no sales in over 1.5 years. UZ, the largest state-owned scrap generator, has only sold 76.4 thousand tons of scrap in 2023, falling short of its 170 thousand-ton target. The new rules will help reduce this gap and support the Ukrainian steel industry.