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. Last Updated: 07/27/2016

ROUND TABLE: Steel Industry's Prospects In the American Market

What are Russian steel producers' prospects on the U.S. market?

Since January 2000, our company has continued to work strictly according to the quotas in the suspension agreement [signed earlier this year by Russia and the United States]. Now we don't have to worry about anyone or anything interfering in our ability to fill our quotas, that is, we don't have to fear introduction of any anti-dumping tariffs. The fact that the Americans have acknowledged there are no grounds for objecting to cheap prices on our cold-rolled steel allows us to ignore the established minimum price limits. However, due to developments right now on the U.S. market, we have no plans to change our pricing policies.

Vladimir Krainov

export sales director, Severstal

We reservedly express our joy over the ending of U.S. anti-dumping complaints against Russia's steel exporters. Russian companies have been cleared of all the allegations of which we felt we were innocent. Of course, it's politically gratifying and important that the pronouncement of our innocence came from such high levels. However, I strongly suspect that these announcements made at such a high diplomatic level in the United States won't bear any real influence on business, at least not in the near future. Right now, our trade relations are governed by the suspension agreement, which sets quotas on steel exports to the United States. It's still unclear whether the Americans will initiate a review of the agreement or if other mechanisms will be introduced. And it's premature to say acknowledgment of Russian steel producers' innocence in this affair is anything more than a statement.

Yana Mirontseva

public relations director, Novolipetsk Metallurgy Plant

It's doubtful that Russian steelmakers will return to the U.S. market at previous volumes. In spite of the fact that anti-dumping tariffs have been dropped, the suspension agreement signed by the Russian and U.S. governments on quotas and minimum prices for Russian cold-rolled steel exports to the United States remains in force. The agreement is still in effect, and it would probably be in the best interest of Russia's producers to observe it because new excesses are still possible. On the other hand, complete repeal of the anti-dumping tariffs leaves the situation somewhat unclear. The [U.S. International Trade Commission's] ruling on the steel exports provides for the following procedure: First, the two countries' governments will sign a quota agreement; and then, according to the original idea, if some shipments begin to exceed these quotas, anti-dumping tariffs will go into effect. But now that the anti-dumping tariffs have been dropped, it's theoretically possible that Russian producers could exceed the cold-rolled steel export quotas and the Americans would be left with no means for responding. However, in practice, I think they would do something else. The real point is that the Russian side entered into the agreement of its own free will. And this was the reason for retracting the anti-dumping complaints. So it's completely possible these complaints could be lodged again if another wave of exports hits the United States. And Russia would clearly feel the loss if exports to the United States were limited. U.S. steel prices are much higher than those on the Asian market - the difference ranging from $20 to $40 a ton. It's difficult to determine the amount of losses that would result from a quota agreement on steel exports to the United States, but I think a figure of $1.5 billion over the next five years is close to the truth.

Svetlana Smirnova

metallurgy analyst, Renaissance Capital

I think the Americans based the retraction of their anti-dumping complaints on compliance with the Russian-U.S. agreement on steel-export quotas. In other words, the same limits will apply to all cold-rolled steel shipments to the U.S. market as to the European market, and the agreed quotas will apply. Of course, Russian producers have no interest in strictly observing the quotas. But there are rules to the game, which were established over the course of negotiations between the United States and our Trade Ministry. And these rules have to be obeyed.

Alexander Agibalov

analyst, Aton company