Ukraine must continue to safeguard exporters’ access to foreign markets – Interpipe

The company is cautious in its assessment of the prospects for redirecting supplies to markets other than those in Europe

The Ukrainian industrial company ‘Interpipe’ hopes that the government, despite the recent change in its composition, will continue to safeguard domestic exporters’ access to foreign markets and resolve the issue regarding the trade representative’s role. This was stated by the company’s GR Director, Nataliia Sydoruk, during the online event ‘From winter to winter: how is the Ukrainian economy recovering?’, organised by the Centre for Economic Strategy.

“Ukraine needs to replenish the state budget through foreign currency inflows, and the country can obtain this currency, first and foremost, from foreign markets,” she emphasised.

Throughout the years of full-scale war, Interpipe has been forced to constantly adapt to a range of challenges: from various military issues linked to the proximity of the front line, to energy shortages and staff shortages. From 1 July this year, with the European Union’s introduction of a new system of tariff quotas on steel imports, the company has faced a new challenge.

In the first 22 days of July, Interpipe had already used up a significant portion of its quarterly quota for the export of seamless pipes to the EU. It is likely that the duty-free quota will run out as early as next month, and a 50 per cent duty will have to be paid to continue supplies to Europe.

The company is therefore once again calling on the European Commission to rectify as soon as possible the technical error that occurred when adopting the new steel regulation, which was caused by the use of Eurostat data that differed from the official figures. As a result, Ukraine’s annual quota for seamless pipes has been underestimated by at least 30 per cent compared to what it would have been had the correct data been used.

As Natalia Sydoruk noted, the company takes a rather cautious view of the prospects for redirecting supplies to alternative markets.

“Chinese manufacturers of seamless pipes have already fully exhausted their quota in the EU and are channelling surplus production to other markets, creating additional competition there. Furthermore, the constant tightening of logistical restrictions due to systematic shelling of Ukrainian seaports is a cause for great concern,” explained Interpipe’s GR Director.

It should be recalled that Interpipe had previously highlighted the underestimation of the EU quota for seamless pipes for Ukraine. Furthermore, according to the company’s own calculations, the implementing regulation does not fully provide preferential treatment for Ukraine, a candidate country for EU membership facing an exceptional security situation, as envisaged by this document, which was adopted by the European Parliament in May this year.