EuroChem Mineral and Chemical Company informs about cancellation of antidumping measures for russian urea supplies to EU

[ 01.08.07 12:00 ]

Antidumping investigations started officially in May 2006 and the result of them was the decision about restriction’s cancellation. During a year Russian producers EuroChem Mineral and Chemical Company, Joint Stock Company “Akron”, EuroChem - Belorechenskie Minudobrenia (Perm) cooperated with antidumping department of EU Commission which is responsible for such kind of investigations. Documents analyzing economic, finance and accounts data of companies were handed over to the Commission. There were conclusive proofs of damage absence for European producers in case of limits cancellation. Europeans spent several months in Russia, visiting production plants of these three companies, studying documents’ originals thoroughly and verifying them with information from “questionnaires”.

In spite of the fact that there is no dumping and as the result of it there is no economic damage for European countries, Russian urea exporters to EU countries - EuroChem and its market partners had to lobby Russian side’s interest for a long time. Antidumping Department of EC Commission studied this problem during a year. The documents which were handed over to the Commission, demonstrated damage absence for European producers from Russian urea suppliers in case of antidumping measures  cancellation. EU Commission representatives made a thorough examination in Russia which included visits to the production plants. Besides, Russian side enlisted the support of European agricultural producers associations (main consumers of urea).

As the result of all the actions taken by EuroChem and its market partners as well as reinforcement of economic and trade relations between EU countries and Russia, 20 countries from 27 countries voted for the duty cancellation. It is worth to note that this is an unprecedented decision. European Union always used effectively antidumping mechanisms for its market closing from any “unwelcome” goods while proclaiming principles of free and open trade. The hope arose that EU will go away from protectionist policy due to the urea decision. Cancellation of antidumping steps in respect of Russian urea is the direct contribution of EuroChem Mineral and Chemical Company to consolidation and development of mutually beneficial relations between Russia and EU.

Notes for editors

For the first time antidumping measures for urea import were put by the initiative of European nitrogen fertilizer producers as far as in November 1987. Later on European producers undertook repeated attempts to toughen restrictions until European Union decision about antidumping duty introduction at the rate between 115 ecu/ton and urea customs cost came into force in March of 1995. As the result there was almost total cessation of Russian urea supply to EU in 1999 – 2000. Russia’s attempts to cancel duty toughening in frames of regular next 5 year’s review failed. And finally, in August 2005 European producers sent request to EU Commission demanding even to replace the existent restrictions to customs ad valorem duty, at rate 26% of customs cost.

Such event development while profitability decrease and natural gas price growth has led to Russia urea producers’ consolidation. Export cessation of raw product to EU estimated at $350-400 million loss per year. Russia exporters’ efforts were supported thoroughly by Ministry of Economic Development of the Russian Federation.