Russia Ponders Two-Fold Surge in Ferrous Scrap Export Duty

SEATTLE (Scrap Monster): The Russian administration plans to double export duty on ferrous scrap. According to the National Trade Ministry of Russia, the export duty on ferrous scrap would be raised from a minimum of Euros 45 per metric ton to at least Euros 90 per metric ton. The move is aimed at ensuring sufficient domestic availability of ferrous scrap materials within the country.

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The Ministry of Industry and Trade of the Russian Federation (Minpromtorg) had recently concluded that the current average export duty of Euros 45 per metric ton has become obsolete, with prices of scrap rising significantly over the past several months. The low export duty has resulted in notable surge in exports. For instance, official statistics indicate that Russia’s ferrous scrap exports to countries outside the Eurasian Economic Union more than tripled in the month of April this year, compared with the month before.

Meantime, the Russian trade associations raised concerns over doubling the export duty. According to them, such a move may impact the profitability of scrap metal recyclers, which in turn may even lead to temporary stoppage of operations. The local availability of scrap may benefit steelmaking industry. However, a boosted demand from construction sector only could lead to increased steel production in Russia.