oDR: Feature

How Ukraine’s metal industry is powering this city’s fight against Russia

Led by an ex-politician with no official power, Kryvyi Rih’s miners and metalworkers have united against Russia

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Igor Burdyga
21 September 2022, 9.23am
In the past seven months, Kryvyi Rih in south-eastern Ukraine has become a frontline city
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Image: Igor Burdyga

In the early hours of 24 February, former politician Oleksandr Vilkul held no official position of power in his hometown of Kryvyi Rih in south-eastern Ukraine.

Hours later, he was leading the city’s defence against Russian forces.

First, Vilkul successfully ordered people to block the runway of the local airport “with anything you can find” to prevent Russian planes from landing.

Then, as a convoy of Russian military forces began their approach from Crimea, Vilkul put out the same order for the city’s roads – ordering they be blocked with huge mining trucks that he tells me were “worth ten million dollars”.

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But how did a man without any position in the Kryvyi Rih city administration manage to take charge? How did he come to be the one issuing orders – and why were people following them?

When I asked Vilkul this, in an interview held in a secret location in the city, he simply said: “I have a certain authority. It helped me make the city into a single fist.”

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Oleksandr Vilkul

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Image: Press Service of Kryvyi Rih Military Administration

It’s true that Vilkul and his father, Yuri – both of whom worked in the metal industry before becoming politicians – hold considerable power in the Dnipro region, with many considering them unassailable. Oleksandr Vilkul even served as the country’s deputy prime minister from 2012-2014.

But after losing a string of elections since 2019, the 48-year-old’s influence had come under question. By the time the Russian invasion began on 24 February, Vilkul was merely the head of a civic oversight board attached to the Kryvyi Rih’s city council.

Now, under Russian bombs, Vilkul’s reputation has been transformed.

Once he was seen as a pro-Russian public figure, who had called for Ukrainian to be stripped of its status as the country’s single state language – now he is the man who knew where to get explosives to blow up road tunnels, as well as which workshops could make anti-tank devices from railway parts, and where bulletproof vests could be produced for the thousands of volunteers lined up outside enlistment offices.

Iron connections

Vilkul’s newfound authority stems less from his political connections, but from an earlier experience: the years he spent as a manager in Kryvyi Rih’s vast iron ore and steel industry. The city is known as the ‘steel heart of Ukraine’, and its exports make up a large part of the country’s economy.

In the early 2000s, Vilkul followed his father through the ranks to become general director at the Kryvyi Rih’s Northern Iron Ore Enrichment Plant, which is owned by the powerful Metinvest group. Today, Vilkul is still spoken of with reverence at the plant, 16 years after leaving the industry to move into politics.

Metinvest is controlled by Ukrainian oligarchs Rinat Akhmetov and Vadim Novinsky, both former sponsors of the pro-Russian Party of Regions. It was this party that gave Vilkul his first parliamentary seat in 2006 – and later saw him become a deputy prime minister under former president, Viktor Yanukovych, who is now resident in Moscow.

Kryvyi Rih’s metalworkers and miners believe Vilkul acted as a director rather than a politician when the invasion began, gathering the city’s industrial elite to defend their hometown in a matter of hours.

“Now it’s one thousand kilometres to the western border, then we reload for a different track width, then across Europe to the Baltic Sea and from there to China”

Within three days, he’d been made head of the city’s military administration by his former political opponent, President Zelenskyi, who also hails from Kryvyi Rih. Together with his father, who remains Kryvyi Rih’s acting mayor despite having lost a 2021 election, Viklul consolidated his family’s power in the city – a power that the president’s team has been fighting in recent years.

But though Russian forces have been held back from the city, there are relatively few people among the mining trucks and excavators at the Northern Enrichment Plant – a sign that Kryvyi Rih’s metal industry is on the back foot. Metinvest initially stopped work at three of the four mining and processing plants of Kryvyi Rih due to the war, and has since restored ore production to barely half of the pre-war level in the spring.

Metinvest traditionally sold excess production to China and South-East Asia, sending it by sea from Ukraine’s Black Sea ports, such as Odesa and Mariupol. After the Russian army’s capture of Mariupol in May, Metinvest lost control over several of its metallurgical plants in the city, from where it used to ship most of its iron ore. Ukraine’s Black Sea ports have been blocked since the beginning of the invasion, with some reopening last month only for the export of grain, due to the threat of a global food crisis.

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Andrey Skachkov is the general director of the Northern Iron Ore Enrichment Plant

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Image: Igor Burdyga

“Now it’s one thousand kilometres to the western border, then we reload for a different track width, then across Europe to the Baltic Sea and from there to China,” Andrey Skachkov, general director of the plant, explains.

The Ukrainian mining and metal industry has criticised the country’s government and the top management at Ukrainian Railways, the national railway company, over the heightened logistics costs for exports, which Skachkov says have “grown from $30-40 per tonne of freight to $100”, with tariffs on transporting ore and steel have increased by 70% since July, making exports unprofitable.

That said, Metinvest rarely misses a chance to declare its contribution to the fight against the Russian Federation. In addition to talking about the defence of Kryvyi Rih, the company regularly reports on cars donated to the army, protective ammunition, drones, tonnes of steel and sand for fortifying Ukrainian cities, on humanitarian aid to hospitals and support for refugees.

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Today, Kryvyi Rih's iron ore production is used to defend the country against the Russian invasion

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Image: Igor Burdyga

Union at the front

Kryvyi Rih’s only internationally owned mine and metal company, ArcelorMittal Kryvyi Rih, stopped its mining operations ten hours after the start of the Russian invasion and announced a reduction in production. A week later, the blast furnaces at the steel plant – Ukraine’s largest – began to shut down.

In a scenario not envisaged by the plant’s union charter, the mine and metal workers trade union branch at the plant – which is owned by Luxembourg multinational conglomerate ArcelorMittal – immediately declared supporting Ukrainian armed forces a priority.

But every day plant workers were being drafted into the army. By the end of July, more than 2,000 people – almost one in ten workers at the plant – had been mobilised.

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ArcelorMittal Kryvyi Rih makes millions of tonnes of iron ore products every year

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Image: Trade Union of Metalworkers and Miners, ArcelorMittal branch

Natalia Mariniuk, the branch’s head, found an argument to override the lack of legal underpinning for the union’s support of Ukraine’s war effort: the trade union continues to support its members – only now they are at the frontline.

“Initially, we bought anything: spare parts for military equipment, chainsaws, socks, dugout stoves, sleeping bags, mats, medicines. We even bought pigs and made stewed meat,” Mariniuk says, recalling how union members gathered supplies for local territorial defence units and military units operating nearby.

In the first days of the invasion, Mariniuk adds, the plant’s general director was not in Ukraine – and many foreign managers simply left.

“Everyone made their own choice,” she says. “For myself, I decided to stay here as long as possible, although I thought: what if I have to take the team out?”

Six weeks later, in April, the blast furnaces were put back online over fears of potential damage due to a sudden power outage. But management still feared interruptions in fuel and raw material supplies, and were concerned about losing control over the plant.

Plant management – which is mostly local managers at this point – don’t mind when employees weld anti-tank devices and road spikes during working hours

The forced downtime at ArcelorMittal Kryvyi Rih has upset Mariniuk: workers have been kept on only two-thirds of their salary. On the other hand, plant management – which is mostly local managers at this point – don’t mind when employees weld anti-tank devices and road spikes during working hours or forge brackets for building dugouts and make steel plates for body armour.

Mariniuk also called for help from metal worker trade unions in Europe, which organised collections of humanitarian aid for Kryvyi Rih. Convoys carrying fire extinguishers, diesel generators, first aid kits, and warm clothes drove to the Polish-Ukrainian border, where the aid was collected and taken back to Kryvyi Rih. Soon, the union was sharing the donations with hospitals and centres for helping displaced persons. And after speaking at a trade union conference in Switzerland, Mariniuk collected €20,000 from participants – and bought “good sleeping bags”.

But the trade union at Kryvorizhstal has had less success when it comes to protecting the rights of workers, Mariniuk admits. Back in the spring, ArcelorMittal suspended 21 clauses of the collective agreement with trade unions, after the Ukrainian government permitted the partial suspension of collective agreements during wartime.

Since July, despite trade union protests, the Ukrainian parliament has allowed companies to stop paying average salaries (basic wage without any overtime or bonuses) to workers mobilised in the army.

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15 September: Russian rocket strike on dams near Kryvyi Rih leads to flooding

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Image: Ukrainian State Emergency Service

Shifting the economy

Stopping production in Kryvyi Rih’s mines and metal shops threatens the city with social upheaval, the mayor’s office admits. The iron ore and steel plants are not only the city’s main employers, but also the main source of tax revenues for the local budget, which is the seventh largest in the whole country.

“The economic situation is very difficult,” agreed Oleksandr Vilkul. “On the one hand, costs have risen and logistics have become more complicated. And the second problem is a drop in prices for metal and ore on the world market. Of course, this will negatively affect the economy of the city.”

Even before the war, the Kryvyi Rih authorities were trying to diversify incomes and reduce dependence on the mining and metallurgical industry. For the past six months they have been shifting the city’s economy to the defence sector, trying to develop business in defence-related industries.

"At some point, it will be difficult for us to explain why displaced persons get three meals a day and travel on public transport out of the city budget"

Sergey Milyutin

Deputy mayor Sergey Milyutin is especially proud of Kryvyi Rih’s light industry – taking journalists on a tour of a clothing factory which, before the war, operated as a small outsourcing operation: Ukrainian textile workers sewed blouses and jeans for European fashion brands.

Now, both shifts at the factory make military uniforms, tactical gear and covers for bulletproof vests. At a demonstration stand, a sample field stretcher immediately catches the eye; its handles are made in the recognisable colours of an Italian fashion house – they made it from offcuts, factory workers explain. Viktoria, a senior technician at the workshop, says bulletproof vests are considerably more difficult to make than blouses.

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This workshop in Kryvyi Rih makes uniforms for Ukrainian soldiers

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Image: Igor Burdyga

This is not the only textile shop in the city. In March, the regional military administration and the mayor’s office moved several textile workshops from the under-fire cities of Kyiv and Kharkiv to Kryvyi Rih. This commercial evacuation took place, to put it mildly, unofficially: the transportation of equipment was paid in cash, sewing shops are still located in city buildings, which violates the premises’ intended purpose.

The fact that the Kryvyi Rih administration has been making decisions that are sometimes ‘close to the line’ of what is legally permitted has attracted attention from regulatory authorities in Kyiv. Milyutin complains that the local authorities are under constant pressure due to an overlap between civilian and military budgets, as well as increasingly informal ties between business and the local authorities, which have united to defend the city.

Milyutin says Kyiv will need to soften strict budget legislation during wartime to solve this.

“At some point, it will be difficult for us to explain why displaced persons get three meals a day and travel on public transport out of the city budget, or why public buses carry soldiers to the front line, and what money we use to fuel them,” Milyutin reflects.

“It is not the time to split budgets,” says Oleksandr Vilkul.

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