By Keith Johnson, a reporter at Foreign Policy covering geoeconomics and energy.
The latest Russian offensive in Donetsk, in eastern Ukraine, threatens to finally topple the city of Pokrovsk—and that carries both military and economic risks for a beleaguered Ukraine already bracing for its most challenging winter of the war.
Pokrovsk, a once-vibrant city of 80,000 people, is the object of a Russian encircling move that began in July and is creeping within miles of the city as every day passes. The city has served as a key logistics and transportation hub for Ukrainian military operations in eastern Ukraine and is the gateway to conquering the rest of Donetsk Oblast—and potentially on to even bigger prizes such as Dnipro, Ukraine’s fourth-largest city before the war.
But Pokrovsk’s fall could have an even more insidious impact on Ukraine’s ability to keep fighting: The city is the source of most of the coal used for the country’s steel and iron industry, once the backbone of the Ukrainian economy and still its second-largest sector, though production has fallen to less than one-third of its pre-war levels. That metallurgical coal is needed to produce pig iron, which is what feeds the majority of Ukraine’s old steel furnaces and a significant chunk of its industrial exports. A healthy steel industry also pays a big share of Ukraine’s tax take, helping fund an economy that operates hand-to-mouth these days.
“Without steel plants, the Ukrainian economy will die. It is a very, very important part of the economy,” said Stanislav Zinchenko, chief executive of GMK Center, a Ukraine-based industrial consultancy.
This week, the Russian army continued nibbling away to the southeast of Pokrovsk, after already having shelled and battered the town from the east. Russian forces are trying to step up attacks now, before muddy weather in the fall and a lack of tree cover makes both mechanized and infantry assaults tougher. Experts say the fight for Pokrovsk could end up taking months, with a siege similar to the monthslong battle for Bakhmut, another key Ukrainian town further east.
While Pokrovsk has already lost some of its value as a Ukrainian transit hub, with roads to the north and east all but unviable, it still serves as a check to further Russian conquests in Donetsk.
The city’s loss “would be operationally significant, but much depends on the price that the Ukrainian military exacts” from Russian forces in the upcoming battle, said Michael Kofman, a senior fellow in the Russia and Eurasia Program at the Carnegie Endowment for International Peace. “The most important consideration is that it opens up a path for Russian forces to push further north and west.”
If the city does fall, and Russian forces retain momentum, it could serve as a springboard for further Russian advances, Kofman said, because it would then be used by Russian forces and it would be harder to establish a new line of defense to protect the remaining Ukrainian industrial base further west.
“Once Pokrovsk is lost, until Pavlohrad, there are fewer suitable areas to anchor a line of defense,” he said.
If Russian forces do get to the west of Pokrovsk, there will be another concern beyond the open road to Dnipro: the risk to Ukraine’s main source of metallurgical coal, which is mined nearby, even during wartime.
For Ukraine’s mostly old-school blast furnaces, coking coal is a key part of making the iron that is used to make steel. Without cheap local supplies of coking coal, Ukraine will have little choice but to turn to even more volumes of pricier imports. That might not mean a halving of Ukraine’s remaining national steel production as some predict, said Zinchenko, but it will mean even more difficulty competing in a global steel market that is already distorted by massive Chinese overcapacity and razor-thin margins.
Source: FP
