Ukraine is considering the temporary ban on export of metals scrap. The Ministry of Economy of Ukraine has published the relevant draft resolution on its website and invited public opinion on the draft. To enter into force, the resolution needs an approval from the Cabinet of Ministers of Ukraine.
The draft resolution suggests to introduce till 31 December 2022 a ban on exports of metals scrap falling under HS heading 7204. The ban would not apply to exports to the European Union, CIS countries (excluding Russia) and some other countries with which Ukraine has signed free trade agreements.
The initiative is caused by the deficit of the metals scarp for the local steel industry. In particular, in 2021 export volumes from Ukraine increased by almost 20 times as compared to 2020, that resulted in critical drop in steel output.
Dmytro Vidsota, the Managing Partner of Robinson Patman, says: “Reducing the metals scraps exports from Ukraine in an important step to protect the Ukrainian steel producers. The Ukrainian industry has talked for a long time about the importance of retaining local ownership of raw materials, and now it also faces the challenge of global CO2 emission reduction efforts. Using metals scrap in steel production is more environmentally friendly (80% less CO2 emissions) and cost-effective, than iron ore. Global trend for decarbonisation will make scrap even more important and demand will continue to increase. A number of countries have implemented temporary export bans, among them are Argentina, Armenia, the United Arab Emirates, and Kazakhstan. The EU is considering the scrap exports ban, so Ukraine may follow this pattern.”
For more information, please contact Counsel Nadiia Dmytrenko and Managing Partner Dmytro Vidsota.
