Various antidumping duties together with other import barriers (including quota regimes), which are currently imposed on Russian-origin high-value added steel products, have forced Russia to focus more on low-value added steel product exports (raw materials and semis). Thus, looking back at the structure of Russian exports for 2006, a tendency toward increase in pig iron, iron ore and semis can clearly be seen.
According to the data released by the Russian Federation's Customs Services, in 2006 overall exports of ferrous metals from the country decreased by 4.1 percent year on year to 28.45 million metric tons. On the other hand, during the same period of time Russia's exports of pig iron, iron ore, and semis all showed positive tendencies. Thus, pig iron exports increased by 15.8 percent to 5.94 million mt, iron ore and concentrate exports increased by 26 percent to 22.84 million mt and semis exports increased by 4.3 percent to 14.3 million mt year on year in 2006. Although during the first couple of months of 2006, scrap showed positive growth in exports, due to strong domestic consumer activity in the second half of 2006, Russia's scrap exports for the whole of the year were reduced significantly.
Interestingly enough, the countries which has been protecting themselves the most from Russian exports of high-value added products by means of duties and other protective measures, showed an increase in imports of Russian-origin raw materials and low-value added products. For instance, the main consumers of Russian origin iron ore in 2006 were China, and also the European Union (EU) which saw a significant increase in supplies from Russia.
It is expected that Russian raw material and semis exports will increase further in 2007. The export data for the first month of the current year confirm this expectation. Thus, according to the data of the Russian Federation's Customs Services, in the first month of 2007 Russia exported 2.23 million metric tons of ferrous metal products, registering a 5.6 percent decrease compared to January 2006. On the other hand, Russian exports of semis and iron ore increased by 2.5 percent to 1.2 million metric tons and by 22 percent to 2.2 million metric tons. Although pig iron exports from the country registered a 13 percent year on year decrease during the first month of the current year to 403,000 metric tons, this reduction was mainly due to the temporary downsizing of production volumes by Tulachermet, the main Russian exporter of pig iron (in 2006 Tulachermet produced three million metric tons of pig iron, sending more than 90 percent of its production for export).
In January 2007, the EU countries continued to increase their imports of Russian-origin iron ore, showing an eight percent increase year on year. The new member states of the EU accounted for the largest increase in Russian iron ore deliveries during the period in question. As for pig iron, USA increased its imports by 70 percent year on year during the first month of 2007, becoming the main consumer of Russian pig iron. On the other hand, Asian counties showed a tendency toward reduction in imports of Russian pig iron, registering a decrease of 50 percent in imports in January 2007. China was the main contributor to this reduction, with its imports of Russian pig iron declining by 80 percent during the period in question.
As regards semis exports, Russian-origin billets were in strong demand in the EU in January 2007. In particular, Italy increased its billet imports from Russia fivefold to almost 100,000 metric tons during the month in question. Germany and Denmark also showed a positive growth in imports of billets from Russia in January 2007.