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Russian steel mills to share export margins with government

Russian steel mills expected to share their export margins with government under new export tax initiative.

Russian steel mills to share export margins with government

As SteelRadar reported before, The Russian government may soon impose export taxes on a number of goods that are currently freely traded and are expected to have a particularly negative effect on the local coal and metallurgical industries. Russian sources claim that they expect the measure to cover all longs and flats, as well as billet, slab, pig iron, coal, and iron ore. However, taking into account the already in place quota trade restriction, scrap exports will be disregarded.

The size of the duty will depend on the local currency rate. If the rate is 80-85 rubles per USD the duty will make 4 percent, if it is 85-90 – 4.5 percent, 90-95 – 5.5 percent and if the exchange rate is over 95 then the export tax reaches 7 percent. However, there are different readings of the term of the duty validity. The initial message stated it will imposed from October 1, 2023 till December 31, 2023, while the latest publications in the local Russian press state the period might until be as long as end of 2024. 

If the parity in question remains above 95, the export tax will be applied at 7%. If the parity falls below 80, the export tax will be reset.


I would say that this is a prohibitive tax so that everyone will reduce exports and this will lead to lower prices on the domestic market. But we went through this already in the late 90s - early 2000s. It didn’t lead to anything good then and it won’t lead to anything good now. Production that worked for export will simply begin to close. The main purpose of this tax is to urgently collect the missing funds for the country's budget. You understand that war is a very expensive endeavor, and the government now has a deficit budget...

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