Russian scrap exporters complain that around 30pc of quota cannot be used. They refer to the fact that some companies, which received quotas, don’t exist anymore or don’t export. Scrap collectors ask Russian Government to handle the situation and re-allocate unused quotas.
Exporter’s concern: Russian Government restricted scrap exports to 1,009,200 t in September-December 2019, but most scrap collectors note that it is not possible to use around 290,000 t of quota. Some companies stopped exports in 2019: they received quota of 197,000 t, but it is unlikely that they will use it. A number of companies (54) are bankrupts or liquidated and their quota is 50,500 t. Some companies received very small quotas (less than 3,000 t), and they can’t export, because their tonnages are not enough even for one cargo and it’s not allowed to consolidate tonnages or assign quotas. Their quota is 43,300 t.
Russian scrap collectors estimate that unused quota will result in Rub4 billion ($63 million) loss of foreign currency earnings. Besides, they expect that scrap export will decrease by 25pc in 2019 as compared to 2018. Ferrous scrap shipments from Russia to foreign outlets totalled around 5,000,000 t last year, according to Davis Index.
Government’ position: Ministry of Industry and Trade of Russia replied that their aim is to restrict scrap export. They believe that if quotas will not be used, then local steelmakers will consume the material. They also mentioned that 137 companies had already obtained licenses to export 685,300 t of scrap.