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Ukrainian producers of ferro-alloys can suffer from higher railway tariffs

13 January 2019

PJSC «Ukrainian railway» is a Ukrainian state-owned railway operator. Earlier it was reported about their intentions. So from February 1, 2019, the railway tariffs will increase. The growth amounted to 16.6%. However, this will not be the only price increase this year. It is planned to raise fares three times — in may, August and November. Each of the three times the growth will be 2.5%. But that’s not all the company’s plans for the current year. It also plans to introduce a standardization of the classification of goods. This, in turn, affect transport costs. For some products, they will increase. From 1 January in the second tariff class moved on manganese ore. She used to be in the I fare class.

Shared his observations of Ukrainian Association of manufacturers of ferroalloys. It is estimated the increase in tariffs will have a negative impact on transport costs. We are talking about the import of manganese ore. Their exercise Nikopol Ferroalloy plant. For him the increase in costs will be 25.5 per cent. This also applies to the local Mn ore and slag. The increase will amount to 11.5% and 14.7%, respectively. The increase in total transportation costs for the month will be 8.4 million. In the year the figure will grow to 100 million hryvnia. The Zaporozhye ferroalloys plant will also suffer. His transport costs will increase to 3.5 million hryvnia. Thus, we should expect a substantial growth of expenses. This will increase the cost of major products. In addition, reduced profitability of some enterprises. This is especially true of the Nikopol plant. This will undermine its economic position. Also its position on the world market can become weaker. This can lead to unpleasant consequences.

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