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A fierce conflict broke out between Russia and Ukraine this week, and European and American countries subsequently imposed severe sanctions on Russia, triggering sharp turmoil in global commodity and financial markets. Russia and Ukraine are both major steel-producing countries and major international steel exporters. According to statistics from the World Steel Association, in 2021, the crude steel output of Russia and Ukraine will be 76 million tons and 21.4 million tons respectively, ranking fifth and fourteenth in the world. , accounting for 3.9% and 1.1% of the total global crude steel production, respectively. The current conflict has caused most steel mills in Ukraine to stop production and disrupt logistics and transportation. Although Russia’s domestic production has not been greatly affected, the relevant sanctions in Europe and the United States will seriously restrict its ability to export related products. It is even reported that the United States is reconsidering Russia If the SWIFT international settlement system is excluded, if the measure is implemented, it will seriously disrupt international trade and cause a surge in commodity prices. From the perspective of the steel industry chain, the CIS countries will export 40.6 million tons of steel to the region in 2020, accounting for 17.2% of the global steel trade volume (the same caliber ratio). The main export destinations are Europe (including the European Union) and the North American Free Trade Area. , Africa, etc., with export volumes of 19 million tons, 2.6 million tons and 4.1 million tons respectively. Among them, the EU is highly dependent on steel imports from the CIS. In 2020, 39.5% of its steel imports came from the CIS. According to a report released by EUROFER in February this year (Economic and steel market outlook) 2022-2023), in the first 11 months of 2021, the EU imported an average of 339,000 tons and 219,000 tons of finished steel from the Russian Federation and Ukraine every month, accounting for 12.8% and 8.3% of its steel imports, respectively. Therefore, the current tension and possible future sanctions will prevent the EU from purchasing the steel it needs from Russia and Ukraine, and will be forced to turn to other regions for supply, thereby pushing up the price of steel in the international market. On February 25, Platts reported that the export price of Brazilian pig iron has risen by 6% due to the conflict between Russia and Ukraine. As far as the Chinese market is concerned, in 2021, my country's steel imports from Russia and Ukraine will be 526 tons and 56,000 tons respectively. The import volume is relatively small and has little impact on the finished product market. However, the number of steel billets imported from Russia and Ukraine reached 278,000 tons and 772,000 tons respectively, accounting for 7.6% of my country's total steel billet imports. With the current Tangshan steel billet at a historically low level, the tightening of external supplementary channels is marginal. Billet prices may have a greater impact. From the perspective of the raw material market, according to the data of the World Steel Association, the iron ore output of Russia and Ukraine in 2020 will be 78.49 million tons and 111 million tons respectively, accounting for 3.4% and 4.7% of the total global iron ore output, and the export volume will be 4,629 tons respectively. 10,000 tons and 25.73 million tons, accounting for 3.1% and 1.7% of the total iron ore trade volume. In 2021, my country's iron ore imports from Russia and Ukraine will be 17.44 million tons and 8.5 million tons respectively, and the two countries together account for 2.4% of my country's iron ore imports. From the perspective of international and domestic market shares, the supply of iron ore in Russia and Ukraine has little impact on the market. In terms of coking coal, my country will import 10.74 million tons of coking coal from Russia in 2021, accounting for about 20% of my country's coking coal imports. Under the circumstance that the domestic coking coal supply is tight, the Russian coking coal supply also plays a key role in the domestic market.
