Ferrexpo’s EU sales share grows, ore demand recovers

Swiss-headquartered, Ukraine-based iron ore miner and pellet producer Ferrexpo increased shipments to EU countries in 2022, Kallanish notes.

The EU market’s share in Ferrexpo’s sales increased 4 percentage points on-year from 23% to 27%, the company says in its 2022 report.

The blockade of ports in Ukraine did not have a significant impact on transporting products to this region, the enterprise claims.

According to Ferrexpo, it has effectively adapted to the war challenges and already had a diversified transport system before the Russian invasion of Ukraine. “Rail transportation towards the western border crossings was the main mode of transport for Ferrexpo back in 2021, which accounted for 58% in the traffic structure, and increased to 83% in 2022. The remaining 17% last year provided transportation by river transport along the Danube River, which amounted to 1.2 million tonnes, compared with 800,000 tonnes a year earlier,” the firm says.

The company points to easing transport problems in early 2023. Rail transport turnaround time has decreased to 20 days compared to 30 days on average in the second half of 2022.

In the first quarter of 2023, there has been a recovery in demand for iron ore in the European market, Ferrexpo observes.

The company sells its products mainly under long-term contracts, predominantly in Europe, in particular, in Austria, Slovakia, Czech Republic and Germany, as well as in Asia, in particular, China, India, Japan, Taiwan and South Korea.

In 2022, Ferrexpo produced 6.1mt of pellet, down 46% on-year (see Kallanish passim). Total pellet sales also decreased 46% to 6.2mt.

Ferrexpo’s 2022 revenue decreased by 50% on-year to almost $1.25 billion. Ebitda was down 47% to $765 million and net cash flow from operating activities decreased by 72% to $301m.

Svetoslav Abrossimov Bulgaria