4 May 2021 17:31

Industry and Trade Ministry: no plans to restrict exports of metals products so far, measure could be considered if necessary

MOSCOW. May 4 (Interfax) - The Russian Industry and Trade Ministry is not plan to impose restrictions on exports of iron ore, rolled steel and other metallurgical products, but such a mechanism can be employed if necessary, the ministry's press service told Interfax.

"At the moment there are no plans to impose restrictions, but in this way there are plans to create a mechanism that the government can employ if necessary," the press office said in commenting on a draft government decree to include certain types of metallurgical feedstock and products in the list of goods that are essential for the Russian domestic market and for which temporary export restrictions or bans may be imposed in exceptional cases.

The draft document was posted by the Ministry of Industry and Trade on the regulation.gov.ru website late last week for public discussion. It will last through May 24.

It is proposed that the list include iron ore, semi-finished iron or non-alloy steel products, rolled steel, as well as copper billets, scrap and waste copper, copper and aluminum wire and unprocessed aluminum. The proposal is being made "with a view to the possibility of further taking measures to temporarily restrict exports" of these goods.

The authors of the draft decree cite that "beginning from Q4 2020 there has been a recovery in selling prices on the Russian market for steel products due to an increase in global metal consumption and a sharp rise in prices on world markets for metallurgical feedstock: scrap and iron ore.

The government has already resorted to export restrictions to curb prices in the domestic steel products market: in January 2021 it raised the import duty on scrap for a 6-month period by 5%, but no less than 45 euros / tonne (previously 5%, but not more than 15 euros / tonne). At the beginning of the year, market sources said that the Ministry of Industry and Trade is also considering a complete ban on the export of scrap metal, as well as restrictions on the export of iron ore feedstock in the event that prices for steel products continue climbing.

At the end of April, there was a meeting chaired by First Deputy Prime Minister Andrei Belousov at which the relevant ministries, including the Ministry of Industry and Trade, were instructed to study the formation of a "market regulation" mechanism in the steel market. The reason for this order was the rise in prices for steel products on the domestic market, which amounted to about 30% at the end of 2020 - early 2021. The government repeatedly received appeals and complaints from consumers of steel products, and the FAS even initiated proceedings against some steel companies (including Severstal , Magnitogorsk Iron and Steel Works and NLMK ) and metals traders.

Among the measures proposed for consideration by the ministries are creation of metals stocks for price interventions, consolidation of orders for the supply of rolled products and signing of direct long-term contracts with a fixed price for metal products, development of measures of state support for metals producers during price fluctuations in their products, the secretariat of the first deputy prime minister reported.