Ferrexpo, a Swiss-headquartered iron ore producer with major operations in Ukraine, has shut down two pelletizing lines due to financial strain caused by the suspension of VAT refunds on its exports.
Mykola Kladiev, Ferrexpo’s Chief Financial Officer, confirmed the decision, citing that the lack of VAT reimbursements has led to a reduction in production volumes and delays in wage payments. In January and February 2025, the company was due approximately $25 million in VAT refunds, which the Ukrainian state has not reimbursed.
“This financial gap is directly impacting operations and planning,” Kladiev stated.
In 2024, Ferrexpo invested $102 million in its Ukrainian operations and had intended to maintain similar investment levels in 2025. However, the ongoing refund issue has forced the company to suspend most of its investment projects, with spending now limited to essential maintenance of fixed assets.
The move raises concerns over the broader impact of fiscal policies on Ukraine’s key industrial exporters amid continued economic and wartime pressures.
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