Europe initiates anti-dumping against Ukrainian hot-rolled steel
11 July 2016
The European Commission (EC) has initiated an anti-dumping investigation against imports of hot-rolled coils from Ukraine, Brazil, Iran, Serbia and Russia, an official publication of the EC reported on July 7. The investigation follows a complaint from the European Steel Association (Eurofer), filed in May 2016. According to the outlined schedule, it will take up to a month for the EC to collect information from the countries involved, no more than nine months to impose some provisional measures and about 15 months to conclude the investigation.
Roman Topolyuk: Europe has been defending its domestic steel market this year, initiating an anti-dumping investigation in February against Chinese steelmakers. The chunk of the market portion at risk from this latest round is significant, by our estimates. In 2015, Ukraine supplied to the EU around 1.3 mmt of steel products subject to the initiated investigation, or 8% of total Ukrainian exports of steel products. Almost all the volumes for that amount were shipped by Metinvest’s (METINV) subsidiaries and Zaporizhstal (a 49.9% JV). The hot-rolled coil under investigation comprised around 13% of Metinvest’s total sales of steel products to the EU in 2015, or 18% of its flat steel.
It’s too early to judge what will be the implications, with a lot depending on the level of cooperation of Metinvest with European authorities and its ability to prove the absence of dumping or the causation of injury to the European domestic steel sector. By our numbers, the export of products under investigation grew 11% yoy in 2015, but that is 7% lower compared to 2011.
Most probably, massive imports of Chinese products to the EU have done the largest harm, and Ukraine has chances to negotiate lower duties compared to other countries. In case any duties are imposed on Ukrainian hot-rolled steel, at the same level as for other countries, this would have a negative effect. So far, our positive view on Metinvest’s Eurobonds is unchanged.
