The GMK Center analytical agency has warned that current government draft decisions regarding the export of steel scrap in Ukraine require substantial revision. According to expert assessments, the current model for distributing the export quota could lead not only to direct losses for the state budget but also to the creation of new opaque schemes in the scrap metal market. This was reported by RBC-Ukraine, citing a publication by GMK Center.
Price Risk: €27 vs. €80 Per Ton
One of the key risks highlighted by analysts is the starting price of €27 per ton for auctions distributing the 200,000-ton export quota, which is currently being discussed in the Ministry of Economy of Ukraine. The ministry operates on the assumption that even a price of €27 per ton is sufficient. However, GMK Center's own calculations show a different picture: if the quota is sold at this price, the budget will receive only €5.4 million, whereas traders' excess profits will nearly triple to €17.2 million. With an alternative starting price of €80 per ton, the center estimates the budget could collect around €16 million, while exporters' excess profits would amount to roughly €6.6 million.
Market Concentration and Price Collusion Risk
GMK Center points to low competition among scrap metal exporters as an additional risk factor. According to analysts, in 2024–2025, 90% of scrap exports were concentrated among just 11 companies. The center observed that some of these entities had a minimal number of officially registered employees, which may indicate the use of intermediary and opaque schemes. In the experts' view, such concentration creates preconditions for price collusion during quota distribution auctions.
Exempting State Companies from General Restrictions
Another risk relates to the proposal allowing state-owned companies to export scrap metal outside general restrictions. GMK Center warns that such a norm could create uneven market conditions and open up possibilities for a scheme where private scrap is exported under the guise of state scrap. According to analysts, this would further increase budget losses and amplify market opacity.
Processing Economics vs. Direct Export
The analytical center also draws attention to the significant difference in budget revenues generated from scrap processing versus its direct export abroad. According to GMK Center's calculations, processing one ton of scrap into finished steel products provides about 14,000–15,000 UAH in budget revenues, whereas direct export brings in only 50–104 UAH per ton. Thus, exporting without processing costs the state hundreds of times more in terms of lost opportunities.
Domestic Demand and the Role of Major Consumers
Amid the forced downtime of steel plants, domestic demand for scrap metal has objectively decreased. Nevertheless, according to GMK Center, major consumers—Metinvest Holding and Interpipe—are ready even now to purchase scrap metal in volumes no less than 65–70% of what is put on the market, with growth potential up to 90–95%. "Only in this way will every ton of Ukrainian scrap work to replenish the budget and defense, rather than line the pockets of 'shadow' representatives of the scrap collection industry," the analytical center concluded.
Context: Zero Quota for 2026 and "Gray" Schemes
To recap, on December 31, 2025, the Cabinet of Ministers of Ukraine adopted Resolution No. 1795, introducing a zero export quota for scrap metal throughout 2026. Prior to the ban, scrap export volumes had been steadily increasing. Meanwhile, despite the established export duty of €180 per ton, Ukraine practically received no revenue from it: scrap was exported through Poland with zero duty and then redirected to Turkey. Due to such "gray" export schemes, the state budget is estimated to have lost over 3 billion hryvnias.
