Russia cancelled duties on Ukrainian FeMn import

Russian Ministry of Economic Development and Trade said it decided to cancel duties on high-carbon FeMn shipments from Ukraine. As it was reported, at the beginning of the current year, as a result of antidumping investigation, 7% and 25% duties were imposed on products of Nikopol FP and Zaporozhye FP, correspondingly.

The investigation was initiated on July 29, 2005 by two Russian FeMn producers: Kosaya Gora Steel Works, and Satka Pig Iron Melting Plant. These producers insisted on imposing of 100% duty for five-year term.

The issue was reconsidered as Ukraine had already cut FeMn exports to Russia by 14% anyway - from 38,770t in 2006 to 33,270t over the ten months of 2007.

Though, it is noteworthy that at the present time, Russian FeMn market is quite attractive for Ukrainian ferroalloy producers. Consumption of FeMn is still high in Russia, and it is yet produced only in blast furnaces at two Russian plants: Satka Pig Iron Melting Plant and Kosaya Gora Steel Works. Considering a significant growth of coke prices in Russian market during Q4 caused by the shortage of coking coals, and the approaching revision of yearly contracts on Mn ore supplies from Kazakhstan, it can be expected that production costs of blast furnace FeMn at Russian plants will increase almost two-fold, Metal Expert estimates.

Besides, in Q4 2007, the domestic price of FeMn (78% Mn) exceeded offer price of the material in Ukrainian market by $100/t on average.

Thus, in the medium-term outlook, the share of Ukrainian FeMn in Russian market is likely to increase.