Kazakhstan moves to extend scrap export ban

Market: Metals
05/10/20

Kazakhstan has published a draft decree to extend the country's ban on scrap metal exports by truck.

The document, which is subject to public consultation until 15 October, suggests a two-year extension from 23 October. The ban includes exports of used and exhausted pipes, rails, railway elements and rolling stock, but excludes alloyed and resistant steel scrap.

The measure was introduced in October 2018 to prevent illegal scrap exports that were estimated at 500,000 t/yr at the time, with a significant amount of this heading to Russia. It has had no impact on documented shipments by rail, as Kazakhstan and Russian are both members of the Eurasian Economic Union (EEU) and the Eurasian Customs Union.

But Kazakhstan imposed a ban on scrap exports by rail in late May this year without any official announcement, contributing to a scrap shortage in Russia and supporting Russian domestic ferrous scrap prices.

Argus assessed the weekly price of A3 grade scrap in central European Russia at 17,737.50 roubles/t ($227.14/t) fca on 1 October, up by Rbs1,451.50/t ($18.59/t) on the month, while the Urals A3 scrap assessment rose by Rbs1,575/t to Rbs18,725/t fca, as Urals-based mills suffered more from the lack of Kazakh-origin material.

In early September, Russia filed a complaint on the matter to EEU regulatory body the Eurasian Economic Commission, blaming Kazakhstan for creating an unacceptable obstacle to the free movement of goods, services, capital and labour within the EEU. The case is still open.

By Valery Zavyazkin

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