Finance
ArcelorMittal to close its second unit in Ukraine amid Russian attacks on power sector
Published by Global Banking & Finance Review®
Posted on February 27, 2026
2 min readLast updated: February 27, 2026
Quick Summary
ArcelorMittal Kryvyi Rih will shut its Casting and Mechanical Plant within three months, citing wartime power disruption and soaring electricity costs after intensified Russian strikes on Ukraine’s energy infrastructure. The company also flagged the EU’s CBAM definitive regime starting Jan. 1, 2026
ArcelorMittal to close a second Ukraine unit amid power-sector attacks
ArcelorMittal Kryvyi Rih to shutter operations amid energy crisis and EU carbon policy
Energy-sector attacks deepen Ukraine power crunch
KYIV, Feb 27 (Reuters) - Ukraine's major steelmaker ArcelorMittal Kryvyi Rih is closing another of its divisions in Ukraine due to a deepening energy crisis caused by Russia's ongoing attacks on the Ukrainian energy system, the company said on Friday.
Russia has sharply increased the number and intensity of strikes on Ukraine's energy sector, targeting both power plants and substations, forcing Kyiv to cut power supplies to businesses and increase imports from the EU.
Unit closure details and timeline
The company, a subsidiary of ArcelorMittal SA, said in a statement that it would close its subsidiary Casting and Mechanical Plant, one of the country's largest enterprises, which includes foundry, press-forging, thermal, weld deposition equipment and machining.
The decision to shut down the plant comes into effect three months from the date of announcement.
High electricity costs drive decision
"The key reason for this step is the energy crisis that our company faces during wartime, in particular the extremely high cost of electricity in Ukraine," ArcelorMittal Kryvyi Rih said.
"This led to the significant increase of the cost of production, which further worsened the economic feasibility of manufacturing steel products," it added.
EU CBAM policy adds pressure
The company also said that another reason was the decision of the European Commission to introduce the CBAM (Carbon Border Adjustment Mechanism) from January without any exceptions or transition period for Ukrainian producers.
The CBAM is the EU's tool to put a fair price on carbon emitted during the production of carbon-intensive goods entering the bloc.
Broader impact on assets and jobs
Second closure this year and employment effects
The plant will be the second of the company's assets to be closed this year.
ArcelorMittal Kryvyi Rih said in January it would close one of its production units in the second quarter because of the EU environmental policy and high local power prices.
The decision to shut down the two units will affect more than 2,400 jobs, it said.
(Reporting by Pavel Polityuk. Editing by Jane Merriman)
Key Takeaways
- •Ukraine’s power constraints are directly hitting heavy industry: stepped-up Russian missile/drone attacks have damaged energy and municipal infrastructure, increasing outages and pushing firms toward higher-cost power and imports. (theguardian.com)
- •EU climate trade rules are becoming an immediate competitiveness issue: the European Commission says CBAM entered its definitive regime on Jan. 1, 2026, shifting from a reporting-only transition (2023–2025) to full customs-linked compliance for covered imports like iron and steel. (taxation-customs.ec.europa.eu)
- •ArcelorMittal’s Ukraine footprint has repeatedly been forced to de-risk amid the war, including prior idling/reductions at Kryvyi Rih for safety—underscoring how security and utilities costs, not just demand, are now dictating capacity decisions. (corporate.arcelormittal.com)
References
Frequently Asked Questions about ArcelorMittal to close its second unit in Ukraine amid Russian attacks on power sector
1Which ArcelorMittal unit in Ukraine is being closed?
ArcelorMittal Kryvyi Rih said it will close its subsidiary Casting and Mechanical Plant, a major enterprise with foundry, press-forging, thermal, weld deposition, equipment and machining operations.
2When does the shutdown take effect?
The company said the decision to shut down the plant comes into effect three months from the date of the announcement.
3What is the main reason ArcelorMittal cited for closing the plant?
It cited an energy crisis during wartime, especially the extremely high cost of electricity in Ukraine, which raised production costs and worsened the feasibility of manufacturing steel products.
4How does the EU’s CBAM factor into the decision?
The company said the European Commission’s introduction of the CBAM from January, without exceptions or a transition period for Ukrainian producers, was another reason for the closure.
5How many jobs will be affected by the two shutdowns announced this year?
ArcelorMittal Kryvyi Rih said the decision to shut down the two units will affect more than 2,400 jobs.
