NLMK Indiana and NLMK Pennsylvania (hereinafter - NLMK USA), companies of the American division of NLMK Group, filed a lawsuit in the US Court of International Trade for the inappropriate refusal of the US Department of Commerce to satisfy the requirements to exclude slabs from the measures under Article 232 of the US Trade Expansion Act.
NLMK USA's operations depend on reliable imports of steel billets, since the local capacity for processing steel into finished rolled products significantly exceeds the capacity for slab production.
For Most of NLMK USA's orders require slabs with a thickness of 250-255 mm, which are not available domestically. As for thinner slabs, which account for 10% of NLMK USA's needs, during the time the duties were in force, the company was able to purchase only 20% of the required volume on the domestic market.
Given the structural deficit, NLMK USA submitted applications in 2018 to exclude slabs from Russia from the measures under Article 232. Three American steel mills - AK Steel, Nucor and US Steel - have filed objections to the exclusion, despite not being able to supply the required volumes and types of slabs.
The company believes that the US Department of Commerce has not made efforts to verification of objections, ignored the evidence that these companies did not produce the relevant products in the required quality and quantity, and did not provide a reasoned basis for their decision.
The total volume of slabs that NLMK USA was able to buy on the domestic market was only about 3% of the company's total needs. The company had to import the rest of the volume in order to continue to operate and ensure the fulfillment of its customers' orders. NLMK USA paid about $ 170 million in duties, from which it should have been exempted.
The company asks the court to recognize the refusal of the US Department of Commerce to exclude slabs from the provisions of Article 232 as illegal and to recognize NLMK USA's right to reimburse previously paid duties .
NLMK Group owns and operates three enterprises in the United States in Indiana and Pennsylvania. The company has invested more than $ 800 million in these assets and has provided employment for 1,200 people, as well as 8,400 jobs in contractors. The company's stable supply is important to more than 90 manufacturing companies in Pennsylvania, Ohio, Michigan, Illinois and West Virginia.
About NLMK Group
NLMK Group - a vertically integrated metallurgical company, the largest in Russia and one of the most efficient producers of steel products in the world.
NLMK Group's metal products are used in various industries, from construction and mechanical engineering to power equipment and offshore wind turbines.
NLMK's production assets are located in Russia, Europe and the United States. The company's steel production capacity exceeds 17 million tonnes per year.
NLMK demonstrates high cost competitiveness among global manufacturers, and the company's profitability is one of the highest in the industry. The company's revenue for 2019 was $ 10.6 billion, EBITDA was $ 2.6 billion. The Net Debt /EBITDA ratio was 0.7x. The company has investment grade credit ratings from S&P, Moody's, Fitch and RAEX (Expert RA).
NLMK's common shares, which free-float is 18.6%, are traded on the Moscow Stock Exchange (ticker “NLMK”), global depository shares - on the London Stock Exchange (ticker “NLMK: LI”). The share capital of the Company is divided into 5,993,227,240 ordinary shares with a par value of 1 Russian ruble. More information about NLMK's share capital can be found here.
For more information about NLMK Group, visit the website.
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