The Russian government is to cancel the five percent import duty for certain flat steel products, including sheet with widths of 1,500 mm and higher.
The decision is to be taken at the request of Russian Prime Minister Vladimir Putin in order to hold back price increases for sheet in the domestic market.
The decision would benefit Russian automobile makers, especially those in joint ventures with foreign car producers. Back in May 2008, several Russian automobile producers appealed to the government asking for the cancellation of the duty. The automobile producers argued that, with the establishment of new joint ventures with foreign automobile manufacturers in Russia which use imported car sheets in production, the market needs free imports of the auto sheet since there is only a limited volume produced in Russia.
In addition, the suspension of import duty on the flat products in question will also be advantageous for domestic pipe makers. In July 2008, pipe manufacturers told the government that the domestic capacity of flat products used in the production of large diameter pipes was insufficient to satisfy their needs. They said they were unable to work at full capacity and satisfy the market's needs in large diameter pipes while the supplies of this type of pipe from Ukraine were limited because of the quota regime.