Russia's strikes on cargo ships have now shut down an iron ore giant. Pivdennyi Mining and Processing Plant (Pivdennyi GZK) has announced it has begun suspending mining and temporarily curtailing operations due to ongoing Russian attacks on civilian merchant ships bound for Ukraine's Black Sea ports.
The plant cannot mine because it cannot ship. Russia's strikes on merchant vessels have effectively blocked the ports through which Pivdennyi GZK exports, leaving several shiploads of iron ore piled up at the ports and in the plant's warehouses with nowhere to go, so the company was forced to stop digging more, per its statement.
The plant is owned by Ukraine's richest man, Rinat Akhmetov, and Smart Holding, which employs 4,480 people, and earned about $463 million in revenue in 2024, according to Forbes Ukraine. It plans to resume mining in August 2026, security permitting, and will keep staff on repair and maintenance work in the meantime. It is the major industrial casualty of a Black Sea shipping blockade that Russia has tightened to a chokehold in late July.
The sea trade has effectively stopped
The plant's shutdown is one consequence of a campaign that has emptied Ukraine's main export corridor. Since Russia began deliberately striking civilian merchant ships, war-risk insurance rates for calling at a Ukrainian port have jumped roughly fivefold, making the voyage economically unviable, and crews have begun demanding double or triple hazard pay, according to UA.News. As of 24 July, the waters around the Greater Odesa ports sat empty for days, with no ship daring to enter Ukrainian territorial waters to load or unload.
The scale of the strikes is what stopped the ships. Russia has hit at least 12 civilian vessels heading to Ukrainian ports, according to Pivdennyi GZK, including ships carrying Ukrainian metallurgical products.
The plant survived everything until the sea closed
Pivdennyi GZK's shutdown is notable because the plant held on through years of conditions that would have closed a weaker operation. The suspension was a forced measure; it was delayed as long as possible, the company said.
Since the start of the full-scale war, the plant operated under constant critical pressures: Russian shelling, power outages, sharply rising logistics costs, the European Union's carbon border adjustment mechanism (CBAM), and tightened EU quotas on Ukrainian metallurgical products.
The plant produces high-grade iron ore concentrate with iron content above 65% and up to 67.8%, which is supplied to Ukrainian metallurgical plants and exported. Without functioning ports, that export has nowhere to go. The pattern echoes 2022, when Russia's blockade of the seaports halted operations at the plant from 1 July that year, with operations only partly resuming in November.
The plant is appealing to the state to reopen the sea
Pivdennyi GZK turned its shutdown into a direct appeal to allies and the Ukrainian government. The plant's collective addressed President of Ukraine Volodymyr Zelenskyy, the government, and parliamentarians, calling the unblocking of logistics routes for Ukraine's Black Sea ports a vital task not only for the mining and metallurgical sector but for the entire Ukrainian economy.
"Restoring access to logistics routes serving Ukraine's Black Sea ports is essential for ensuring the long-term viability of not only the mining and metals sector, but the Ukrainian economy as a whole," the company said.
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