Russia to hike anti-dumping duty for Interpipe wheels

During the next month and a half, the Eurasian
Economic Commission (EEC) will increase the anti-dumping duty rate on imports
of Ukrainian steel wheels to 34.22% from 4.75%, Kommersant, a Russian business
daily and website, reported on Jan. 22. The EEC published its decision on Jan.
19.

The EEC is the executive body of the Eurasian Economic Union (EAEU)
led by Russia and uniting five former Soviet countries, including Belarus,
Kazakhstan, Armenia and Kyrgyzstan. In 2016, the EAEU countries produced 234.7
kt of steel wheels, consumed 243 kt and imported 57.2 kt, according to
Kommersant’s estimates.

Ukraine’s sole producer of steel wheels is Interpipe
NTRP, a part of Interpipe (INPIP), the largest Ukrainian producer of steel
pipes and wheels. This plant sold 76 kt of wheels in 2016, Kommersant reports.

Dmytro Khoroshun: We estimate
that Ukraine’s exports of wheels to the EAEU were mainly to Russia (up to 53.7
kt in 2016) and Belarus (up to 2.4 kt). These volumes are obviously a
significant portion of Interpipe’s steel wheels sales. There is little hope
that the company will be able to redirect the sales elsewhere, because global
supplies are plentiful. In particular, as Kommersant reports, Prommashkomplekt,
a producer from Kazakhstan, plans to boost in mid-2018 its production capacity
by about 200K wheels (about 80 kt) per year.

The coming duty rate hike is certainly a negative
for Interpipe, even if Interpipe continues selling some wheels to Russia might
be the case, as Kommersant speculates.