EU and Ukraine steelmakers criticize the easing of sanctions against the Russian Federation

European steel producers’ association EUROFER and Ukrainian steelmaker Metinvest have strongly criticized the twelfth package of sanctions against Russia adopted by the European Commission earlier this week. Steelmakers condemn the actual easing of restrictions on imports of Russian steel semi-finished products. This is reported by Fastmarkets.

“EU member states made a historic mistake by granting further exemptions for imports of high-carbon Russian steel semi-finished products. The interests of a small fraction of EU steelmakers, buoyed by a few veto-wielding countries, undermine the goals of the sanctions, where steel plays a strategic role not only economically, but also directly in Russia’s war against Ukraine,” Axel Egert, CEO of EUROFEER, said.

He emphasized that Russian slabs are cheaper than semi-finished products from other countries, and therefore some steelmakers in the EU want to continue to benefit from cheap raw materials. Now semi-finished products from Russia are 26% cheaper than from alternative suppliers.

“Some steelmakers are determined to maintain the current advantages they are unfairly enjoying. If Ukrainian rolling mills operating in the EU have been able to diversify their sources of imports of semi-finished products from Russia, why shouldn’t other importers do the same?” added Axel Eggert.

Ukrainian steel group Metinvest is in solidarity with EUROFER’s position on the 12th package of sanctions against Russia. The company has two rolling mills in Italy with a total capacity of 1.6 million tons of rolled products per year.

Prior to Russia’s full-scale invasion of Ukraine, Mariupol-based Azovstal and Ilyich Iron and Steel Works acted as a supplier of slabs to these assets. Due to the destruction of the plants in Mariupol, the company successfully reorganized to work with alternative suppliers

Currently, semi-finished products are supplied from alternative sources, in particular from Europe and Asia.

In 2021 Ukraine shipped more than 2 million tons of slabs to the EU market. In 2022, shipments decreased to 365,000 tons. Before the full-scale invasion, Ukraine was the second largest supplier of slabs to the EU after Russia.

As GMK Center reported earlier, in the 12th package, the EU extended quotas on Russian slabs for another four years. The total quota on imports of these products from October 2024 to September 2028 is set at 8.5 million tons with a more detailed breakdown by period. The previous sanctions on imports of slabs were imposed last October as part of the 8th package of sanctions. At that time it was decided that it could continue until the end of September 2024 within the established quotas, and from October 1, 2024 imports should cease. However, the 12th package of sanctions actually weakened the previously imposed restrictions.