Russia Approved Decree to Implement Export Tax on Base Metals

SEATTLE (Scrap Monster): Russia imposed temporary export duties on steel and non-ferrous base metals. The duties, with effect from 1^st August this year, were imposed through a government decree that was signed yesterday by Russian Prime Minister Mikhail Mishustin. The duties will be in effect through end of this year and will be applicable to 340 steel and non-ferrous metals sold outside the Eurasian Economic Union (EAEU).

The new duty rate will be specific to metal categories and will cover exports of certain steelmaking raw materials, semi-finished and rolled-steel products and primary forms of copper, nickel and aluminum. The rates will be calculated based on the prices during the initial five-month period of 2021.

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The export duties levied on ferrous metals are expected to contribute nearly $1.6 billion to the state budget, where as the contribution from non-ferrous metals is expected to be around $700 million, said the Russian Ministry of Economic Development estimates.

The export duties are aimed at cooling domestic metal prices. During Jan-May ’21, export prices for ferrous metals surged by 30%, whereas those of nonferrous metals skyrocketed by 50% over the previous year. In addition, the move targets to rein in excessive profits by Russian metal companies. Incidentally, the profits during Q1 2021 had galloped by nearly 3.5 times, compared with corresponding quarters in the years before.