The Verkhovna Rada of Ukraine extended the duty on the export of ferrous scrap
The Verkhovna Rada of Ukraine voted for the bill No. 5175, which provides for an extension of the duty on the export of ferrous scrap in the amount of 58 euros /ton for 5 years. A total of 291 deputies voted for the adoption of the bill, with the minimum required 226.
“The duty was first established in 2016 to moderate the export of scarce raw materials from Ukraine. The metallurgical industry, which provides 10% of the national GDP, 35% of merchandise exports and 200 thousand jobs, cannot work without it. After all, there is no technology that allows you to get steel without using scrap metal, "- wrote on Facebook co-author of the bill, Deputy Chairman of the Verkhovna Rada Committee for Economic Development Dmitry Kisilevsky.
According to him, the EU green course further increases the value of scrap as a raw material for metallurgy: its use in electric arc furnaces reduces CO emissions by up to 10 times 2 compared to classical technologies of steel production in converters and open-hearth furnaces .
“The duty has already proven its effectiveness. Before the adoption of the law on increasing the export duty, Ukrainian metallurgical enterprises experienced an acute shortage of scrap metal, as a result of which they reduced production volumes and were forced to stop working. So, only in the first year of the duty in 2016, the scrap deficit decreased from 20% to 11%, and at the end of last year, the deficit was actually overcome, "Oleksandr Kalenkov, President of Ukrmetallurgprom, commented on the adoption of the law.
He stressed that the extension of the duty guarantees additional GDP growth and the ability to save and create 25 thousand jobs.
Against the extension of export duties on the export of scrap metal actively protested in the Ukrainian Association of Secondary Metals (UAVtormet). They stated that the extension of duties on the export of scrap metal would cause further degradation and curtailment of business activity in the scrap collection industries.
For the first time, Ukraine introduced a duty on the export of scrap metal in September 2016, amid an acute shortage of scrap in the domestic market. At that time, President Petro Poroshenko signed a law providing for an increase for a period of 1 calendar year of the duty on the export of scrap from 10 euros to 30 euros per ton, while in 2017 the duty was extended for another year - until September 15, 2018.
In the summer of 2018, Poroshenko approved an extension of the scrap export duty for 1 year, until September 15, 2019, and an increase in the duty from € 30 to € 42 per ton.
At the same time, in April 2019, Poroshenko approved an increase in the duty on the export of scrap from 42 euros to 58 euros per ton and the extension of the duty until September 15, 2021.