The list of measures to support metallurgists faced with weak demand and low prices may include an increase in export duties on scrap and mitigation of the burden of excise duty on liquid steel. Market participants are asking for the freezing of railway tariffs to be added to the package of anti-crisis measures, and analysts point to the need to protect against competition with Chinese metal, as well as incentives for increased domestic consumption and capacity modernization.
The list of measures to support the metallurgical industry includes an increase in export duties on raw materials, as well as proposals to mitigate the burden of excise duty on liquid steel. This follows from the materials of the meeting of the subcommittee on improving the sustainability of the financial sector and individual sectors of the economy on August 29.
In particular, it is proposed to work out an increase in the rate of export duty on ferrous scrap in the amount of 5%, but not less than 25 per ton. Currently, shipments within the quota are subject to a duty of 5% and at least 15 per ton. The abolition of excise duty on liquid steel for electrometallurgical enterprises in 2026 and exemption from excise duty for new facilities with investments of 50 billion rubles or more for the period of the active investment phase and the next three years are also being considered. It was instructed to consider the possibility of adjusting the excise tax.
Currently, the excise tax rate is 2.7% of the monthly average export price for steel slabs based on FOB in the ports of the Black Sea. But if the ruble price of a slab is below 30 thousand rubles per ton, the excise tax is not paid.
The Russian metallurgical sector is in a difficult situation due to weak demand and low prices. According to Severstal's estimates, the demand for metal in Russia decreased by 14-15% in the first half of the year, and by 25% in the mechanical engineering and energy sectors. Following the results of seven months, the production of steel and finished rolled products decreased by 5.1% and 5.3%, to 40.3 million tons and 35.2 million tons, respectively, according to Chermet Corporation.
The industry systematically advocates the abolition of the excise tax and "here we are not talking about saving, but about restoring the balance of the tax burden."
In the current conditions, the payment of excise taxes exceeds the amount of income tax, which negatively affects the competitiveness of the industry. The current cut-off price of 30 thousand rubles is unreasonably low. According to him, now, with the cost of a slab at 32 thousand rubles, which corresponds to the figures of twenty years ago, metallurgists are recording losses, while having to pay an excise tax on steel.
The list of measures will still be adjusted. At a minimum, a clause will be added on the indexation of the excise tax on steel, depending on market conditions.
The metallurgists themselves are also asking for logistical support. The Russian Steel Industry Association in a July letter to the Ministry of Industry and Trade
