According to Derzhzovnishinform (DZI), the Ukrainian national research and information center for monitoring international commodity markets, Ukrainian steelmakers could lose one of their most important export markets if China starts an antidumping (AD) investigation into imports of Ukrainian steel products. DZI has made its comments in the context of concerns that China may initiate an AD action against Ukrainian steel imports following the investigation it opened against HR imports from Russia earlier in May.
However, DZI also said that China may delay any moves towards an AD investigation, as it has not been long since Ukraine started to deliver steel products to China. "This is why the situation as regards the low prices of Ukrainian rolled products could be resolved without governmental intervention," DZI stated.
During the current global economic crisis China has become one of the most important export markets for the Ukrainian steelmakers. In Q1 2009, Ukraine shipped 711,000 mt of rolled steel to China worth an approximate $250 million, i.e. 10 percent of its total tonnage output of rolled steel products.
During the first four months of 2009, Ilyich Iron and Steel Works of Mariupol (Ilyich) exported about 120,000 of flats to China, while Zaporizhstal shipped 50,000 mt. The subsidiaries of Industrial Union of Donbass delivered mostly semi-finished steel products to China in the same period, with Alchevsk Iron and Steel Works exporting 391,000 mt of slabs, and Dneprovsky Iron and Steel Works named after F. Dzerzhinsky delivering 67,000 mt of tube billets.
Ukraine's steel exports to China are favored by the fact that the Ukrainian steel products are offered at prices 10-15 percent lower compared to Chinese domestic prices.
According to DZI, an alternative market for Ukrainian steel exports could be the Middle East.
As SteelOrbis previously reported, in May 2009 China initiated AD investigation into HR imports from Russia, stating that imports of Russian steel products into China during the first quarter of 2009 totaled 103,000 mt, up 210 percent year on year.