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. Last Updated: 07/27/2016

Official defends uranium export policy

A recent finding by the U. S. Commerce Department that former Soviet republics are dumping uranium on the American market could cripple defense conversion efforts in the former Soviet Union, the Commonwealth's top uranium exporter has said.

The allegations, which could result in retaliatory duties as high as 116 per- cent on both natural and enriched uranium, will price Commonwealth exports out of the market and cripple its struggling defense industry, said Albert Shishkin, president of Techsnabexport (Tenex), the former Soviet radioactive materials export monopoly.

"All of the dollars we earn from Uranium exports are not allocated for wallpaper purchases", Shishkin said, "but tor purchases of U. S. technology for our defense conversion program. Restrictions could make producers sell to third countries, with unfortunate consequences".

Dumping is the selling of a product below cost as a predatory means of gaining a market share. Dumping cl es usually must prove economic damage to local industry.

The $110 million in annual uranium shipments to the United States command a 10-12 percent market share, and rank third among the Commonwealth's $500 million annual exports to the United States. The U. S. market is dominated by French and Canadian producers.

Soviet shipments began in 1990 in light of-the Nuclear Non-Proliferation Treaty when defense cuts here freed domestic supplies for world markets. Ironically, Shishkin said, despite the treaty and U. S. efforts to steer the Russian economy- towards market forces, dumping charges could counteract such measures.

The Commonwealth uranium industry, namely Kazakhstan, Russia, Ukraine and Uzbekistan, employs some 300, 000 workers. Enrichment plants are all located within Russia, mostly in towns set up around them. With West European purchases stagnating, the loss of the U. S. market, believed to have the most capacity given its vast nuclear power industry, could have devastating effects.

"Humanitarian aid is a very good thing, but if we have the possibility of selling a product, barriers should not get in the way", Shishkin said.

U. S. allegations against the Soviet Union were levied last November. The Soviet authorities issued a response in December, inviting Commerce Department officials to tour facilities, according to Alexei Grigoriev, director of Uranservis, an enrichment services company under Tenex's umbrella. The letter brought no response, save a bureaucratic, 1, 000-word questionnaire. Some of the questions went unanswered for national security reasons, Tenex claims.

"This actually buys the idea that the results of the case were settled beforehand", Grigoriev said, noting that legally the charges were levied against the Soviet Union, which no longer exists. The industry says it will fight this in court.

Russia vehemently denies the dumping charges, claiming low labor costs, superior centrifuge technology, 45 percent of the world's deposits, and the exchange rate to the dollar (set by the Central Bank at 100 rubles to $1), support its pricing structure. Tenex concedes that different accounting standards here and valuation of assets - lead to some discrepancies, but claims other producers are selling at similar prices.

Proving the dumping charge is difficult, given different economic models here and in the West, although the Commerce Department reportedly used a Canadian model to determine its initial findings.

Ultimately, Tenex claims charges were brought forward by French and Canadian producers.

"We got into competition with Canadian and French firms. It was a questionof their interests being violated. The U. S. industry only employs 4, 000 people", Shishkin said, quoting Western media reports.

"We dont want 100 percent of the U. S. market, and it won't happen", he said, calling for peaceful negotiations and an eventual market share of 20-25 percent.