Russia extends quotas on metal scrap exports until July 2024

The subcommittee for customs tariff and non-tariff regulation in Russia has approved the extension of quotas for exporting scrap ferrous metals. This extension, effective from 1 December, 2023, to 30 June 2024, aims to secure an ample supply of scrap for the Russian steel industry, stabilise scrap prices, and ensure a steady flow of resources to domestic metal companies. This decision comes as the original quota, set to expire on 31 December 2023, is prolonged to sustain the country's steel sector.

Major updates:

• The quota remains at 600,000 tonnes (t), the same as in the second half of 2023.
  
  
• Import duties within the quota remain at 5%, but not less than Euro 15/t.
  
  
• Import duties beyond the quota remain at 5% but not less than Euro 290/t.
  
  

Quota allocation:

• 80% of the quota is distributed based on historical export data from 1 January to 15 December 2023 including different values for different regions of Russia.
  
  
• 20% is distributed to companies that supply scrap systemically to important organisations or Russian metallurgical enterprises for the period from July to December 2023.
  
  

Potential Impacts:-

The extension of scrap export quotas in Russia is anticipated to contribute to the stabilisation of domestic scrap prices and offer support to local metal companies. However, it raises concerns about the potential limitations of exports, impacting the availability of scrap for international buyers. The imposition of quotas and duties has elicited mixed reactions, with some expressing apprehension, particularly from European countries. The extension is perceived as having the potential to influence global scrap metal prices and disrupt established supply chains.