The management of the ArcelorMittal ironworks in Zenica, the biggest exporter in Bosnia and Herzegovina, has announced that the company could shut down if the state-owned power board Elektroprivreda BiH increases electricity prices by 125% as announced.

“We use 520,000 megawatt-hours of electricity annually and with additional costs of 70 million convertible marks (about €35 million) there is no point in continuing with production. We cannot survive,” ArcelorMittal’s director-general Nikhil Mehta told a press conference on Tuesday.

He explained that he had received an offer from Elektroprivreda BiH with the new price of electricity, which is 125% higher.

“The losses would be lower if we stopped production. These are the most difficult days for the company ever,” added Mehta.

He explained that the prices of other energy products and raw materials used for production had increased too while the price of steel and iron was falling on the global market. According to Mehta, as of this month, the company will operate at a loss.

Mehta called on the authorities in the Federation of Bosnia and Herzegovina entity and on Elektroprivreda BiH to take steps to prevent the drastic jump in the price of electricity.

ArcelorMittal Zenica is the largest manufacturer of steel products in the Balkans, with a production capacity of almost one million tonnes a year, and as such it is Bosnia and Herzegovina’s biggest exporter. ArcelorMittal Zenica is owned by Indian steel magnate Lakshmi Mittal.

Hina did not report how many jobs would be lost if the company shuts down.

Elektroprivreda BiH has announced on several occasions this year that the price of electricity will go up due to the accumulated problems of the mines that operate as part of the Elektroprivreda BiH company, having incurred losses of €400 million.