Russian metallurgical industry confidently into the WTO

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The main objective of Metallurgists — to meet the demands of consumers, including forward-looking and innovative, quality steel products. About how they do it, "the Russian newspaper" said the director of the Department of Basic Industries Trade Ministry Viktor Semyonov.

— Did the Russian steel to create a market of innovative products and close to world standards?

— Overall metallurgical successfully cope with this task. Examples for this are many. For example, manufacturers of pipes in the past few years have created a modern competitive industries, including large-diameter pipes, certified by all international standards of API, ISO, DNV and other metallurgical enterprises have also created a number of new competitive industries, such as mill 5000 in Magnitogorsk, products which has passed the necessary certification. Now the demand creates the market of high-tech products — consumers need to have special properties, corrosion-resistant, highly wear-resistant, capable of operating in hostile environments, cold-resistant. This leads to the fact that metallurgists are constantly working to improve the quality of the metal. If we talk about the world’s standards, the Russian steel industry has achieved significant results, retaining, even in a crisis, a leader in the world. We are ranked 5th in the world in the production of steel (after China, Japan, the USA and India), the production of steel pipes — 3rd place (after China and Japan), the export of steel — the third largest in the world (trailing China and Japan), the 5th largest producer of commodity iron ore (after Brazil, China, Australia and India). Aluminum production Russia takes 2nd place in the world (after China), its exports — 1st place, to produce and export nickel — 1st place in the world for the production of titanium mill — 2nd place. Over the past 8 years the process of forming the industry’s largest vertically-integrated groups, allowing them to offset the risks to both the domestic as well foreign markets, optimize the investment environment and provide for its own raw material security. Also, in recent years the holdings actively developed their own customer service for metal and trading of finished steel products in different regions of the country and the world. All this suggests that the level of development of the Russian metals corresponds to the world, and a number of positions and surpasses it.

— As the crisis has affected the industry?

— The crisis was not a Russian metals and in metal consumption has decreased dramatically. The fall in output in the industry — it’s consequences. A root cause — a sharp decline in demand for the metal. During the crisis, especially in late 2008 — early 2009, the demand for steel products in the domestic market fell by almost 70%. It is this fall, along with the lack of external demand has led to a forced reduction in the production of metal products. Only competent management companies and high quality products have allowed steelmakers in the acute phase of the crisis to refocus the direction of deliveries to foreign markets, where demand is still maintained — this is primarily the Asian markets, China, which helped to keep jobs and not to stop production. In fairness I must say that it was not always smooth, there were stops and redundancies, but to a much lesser extent than in many other industries. In fact in 2010 metallurgy overcome the crisis. In 2011, the Russian metallurgical plants were produced: 103.5 million tonnes of iron ore concentrate, which is 3.5% higher than in 2008, 59.5 million tons of finished rolled steel, which is 4.4% higher than in 2008 year. Production of steel pipes in 2011 was 10 million tons, which is 23.5% more than in 2008.

— How much money was invested in the steel industry in recent years?

— Of course, such a fast time to production figures would have been impossible if the industry did not spend the last years of active investment policy. For the period 2000-2010, the industry has invested more than 1.6 trillion rubles — an absolute record of investment in the industry. Of course, we buy new equipment, world-class technology that has allowed the industry to move to a new performance. Today, the metallurgical industry has one of the lowest in the industry, the rate of depreciation of fixed assets, which does not exceed 40% by the end of 2011. If we talk about its performance through that, for example, the share of casting to continuous casting machines in general casting in 2007 was 71% and in 2011 — 75%, the volume of open-hearth steel production declined from 11.9 million tons in 2007 to 7,000,000 tons in 2011. At the same time growing share of steel produced in electric furnaces: in 2007 the share of electric steel in total production was 27% and in 2011 — already 33%. Even more illustrative example to reduce emissions into the environment. In 2011 compared to 2007 emissions of air pollutants decreased by 25% and the volume of wastewater discharge to surface water bodies — 20%.

— Are there enough skilled industry?

— The issue of staffing all rising sharply in recent years. And the reasons for this are many: from the population (physical reduction of potential exposures) and ending with the high requirements to the ability of staff to work on the newest tend to import equipment. As part of the Government orders the Ministry of Education in cooperation with the Ministry of Industry, NUST "MISA" and NP "Russian Steel" developed a draft concept of program staffing metallurgical complex. It addresses a number of problems that are objectively arise in connection with the transition to new types of process equipment. This is to ensure the implementation of the principle of "learning through life" through the introduction of a system of motivation, training, retraining and skills development, the creation of electronic educational resources in the form of databases and the development on the basis of their distance learning systems, the creation of a system of professional industry standards and upgrading of existing and the creation of new federal state educational standards and professional educational programs of different levels of professional education based on them. Much attention is paid to improving the effectiveness of educational activities to meet the staffing needs of high-tech steel plants, as well as the formation of a network of specialized educational institutions and the creation of multi-level multi-university and industry research and educational facilities. Given that the development of the concept were heavily involved employers themselves — steel plants, these are the main challenges that must be addressed for the success of the industry and to overcome the shortage of human resources. In the near future the project will be approved by the Ministry of Education of the concept.

— Russian companies are connected to the program of energy efficiency?

— Certainly. In accordance with the Strategy of development of the metallurgical industry for the period up to 2020 provides the industry’s transition to an effective electric furnace steelmaking, almost 100% of casting steel casters and a number of other technological changes aimed primarily at improving the energy efficiency of production. In recent years, great importance is given to energy efficiency. Create new mechanisms to encourage enterprises to conduct work on energy efficiency. Ministry of Industry with the participation of interested executive agencies and organizations developed a set of criteria, including numerical, and the Assignment of a class of high-tech investment in the creation of which is the basis for the provision of investment tax credit. In strict compliance with a set of criteria formulate
d a list of such facilities and technology. In December last year, the Ministry has submitted to the government a draft decree "On approval of the list of plant and equipment related to the sites of high energy efficiency, which is not provided for the establishment of energy efficiency classes for which taxpayers have the right to apply accelerated depreciation special factor, but not 2 above. "

— Which department is making efforts to ensure a level playing field in the global steel market?

— The Ministry is actively working to protect the interests of domestic producers of steel in the domestic market. In the Russian market of steel products traditionally tough competition, as the share of imports in domestic consumption of steel is about 10%, but for some items — mainly pipes — up to 15%, which is a very high figure. This often made imports at dumping prices. In accordance with the Agreement on the application of special protective, antidumping and countervailing measures against third countries on five metal acts up to the revision of the existing and extended to the territory of the Customs Union. This is a safeguard duty on stainless steel tubes at a rate of 9.9%, but not less than 1.5 million dollars per ton (currently undergoing revision measures), as well as anti-dumping duties on bearing pipes from China (19.4%) , for some types of steel pipes from Ukraine (19,4-37,8%) and engineering fasteners from Ukraine (21.8%), and stainless steel flat products from China (29,9-39,1%), Korea ( 4,8-62,8%), Brazil (21.1%) and South Africa (33.3%). Also in December 2011, completed an anti-dumping investigation of rolled metal coated from China. The Ministry proposes to set anti-dumping duties for a period of five years at a rate of 8,12-22,56% for various Chinese suppliers. The decision on the introduction of this measure will be taken by the Commission of the Customs Union.

— How will it affect the industry joining the WTO?

— For metallurgy WTO accession has both advantages and possible disadvantages. A possibility to use the WTO to resolve trade disputes, including appeal unfair decisions on the application of trade defense measures against Russian steel products. Now with regard to the Russian metal in overseas markets has 20 measures 12 anti-dumping duties (EU, China, Indonesia, Mexico, the U.S., Thailand, Turkey), 2 quota restrictions (Ukraine, EU), 1 special protective duty (Philippines) 1 countervailing duty (Mexico), the agreement with the U.S. on steel wire, 4-dumping investigation. Together with minutes of Economic conduct systematic work to invalidate unfair decisions in respect of imports of Russian steel products. The disadvantages can be attributed primarily generalized reduction in tariff protection of steel by 5-10%. In the new businesses will have to make efforts to maintain the competitive position in the Russian market, to continue activities to improve the quality of metal. After 5 years (transition) export duties on ferrous metal scrap and used rails down to 15%, but not less than EUR 15 per tonne, up to 5%, but not less than 5 per tonne. A similar situation with scrap non-ferrous metals. This can lead to a substantial increase in exports of strategic raw materials — scrap metal and reduce its demand on the domestic market, which would jeopardize the stable operation of a number of metallurgical enterprises, the main raw material for which is the scrap metal in the first place is the Electric steel factories and enterprises spetsmetallurgii.

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