However, the U.S. announcement of tariffs on steel and aluminium imports in the month of March’18 have irked major economies such as EU, China, Canada following which they have also launched various protectionism measures against steel imports claiming protection to their domestic metal industry.
Subsequently, this restricted trading structure after tariffs and quotas announcement has once again dampened the spirit of various steel companies globally, that were hoping for revival.
One such company whose relaunch plan has been marred is Russia’s MMK (Magnitogorsk Iron and Steel Works) which is country’s one of the largest steel producers. According to the sources, MMK has postponed the reopening of its lucrative steel project in Turkey amid uncertainty due to the global trade war.
The MMK Metalurji complex, located near Iskanderun on Turkey’s Mediterranean coast and in Istanbul, was built by MMK between 2007 and 2010, at a cost of over USD 2 billion. However, in 2012, the hot-rolled steel plant was closed down amid a global slump in steel prices. This plant in Turkey was due to restart in the summer of 2018. However, as of now MMK has put its re-launch plan on hold and plans to decide its fate in November when there will be some clarity on safeguard measures of various countries.
Although, MMK’s Russia operations are unaffected by U.S. and EU protectionism measures as it did not exported steel to both the economies, about 30% of its Turkey’s plant production was intended to be exported to EU and nearby countries making it best to postpone its plan.
Along with these tariffs and quotas imposition by major economies, the Russian steel firms are also affected by recent U.S. sanctions announced on Iran which include a ban on the sale, supply and transfer to or from Iran of raw or semi-finished metals. According to market reports, country’s metal firms have started cutting back on their sales to Iran post sanctions announcement.
MMK and Severstal (which is also a Russian steel giant) however claims that they have started redirecting their supplies to other countries meant for Iran amid Iran’s growing steel production and consequent reduction in its volumes of steel imports.