Emirates steel calls for action to face increasing competition and falling prices
21 April 2015
Emirates Steel, the largest integrated steelmaker in the UAE, warned of the damaging effects of the flow in China’s and Turkey’s steel to the UAE markets, and calls for protective actions to face the increasing competition and falling prices that will affect the UAE’s industrial future development plans.
“The steel industry plays a crucial role in the UAE’s industrial development plans and therefore should be protected against unfair trade practices,” said HE Saeed Ghumran Al Romaithi, Emirates Steel’s Chief Executive Officer, in a statement to the press.
He warned that the inflow of Chinese and Turkish steel imports into the UAE, at prices below an acceptable market value negatively impact production volumes and profitability of UAE steel players, thereby causing damage to both existing and future steel expansion and investment projects and threatening UAE steel sector. He added that the lack of strong customs protection in the UAE will lead to the escalation of the problem. “If proper measures are not adopted, many producers in the UAE would be at risk of losing capacity, putting the country at risk of losing impetus in diversifying its economy away from dependence on oil as a major source of income”.
Besides the introduction of anti-dumping duties, Al Romaithi also recommended that a uniform standard should be introduced to fend off low-quality Chinese imports and force Chinese exporters of steel into the UAE to comply. Similar practices, such as the ASTM (American Standards for Testing of Materials) and BS (British Standards), are applied in the US and Europe, said Engineer Al Romaithi.
A surge in Chinese exports this year has led to anti-dumping investigations being initiated in the U.S., Turkey, Southeast Asia, Europe and other main destinations for the shipments from China. Al Romaithi pointed out to the urgent need to revise import tariffs or to increase duty levels to avoid the threat of cheap imports from China and Turkey, with other traditional exporters also acting aggressively to protect their market shares, citing the 110% antidumping duty imposed by the US on Chinese wire rod imports and Turkey raising its import duties to 30-40%. Some European countries also imposed 13-45% customs protection duty on Chinese flat steel products.
According to Emirates Steel, Chinese exports to the UAE have grown by 63% in 2014 compared to 2013; the same increase was estimated for the GCC region and the whole Arab region for the same period, while Chinese exports to UAE of billets increased by almost 300% in 2014 compared to the previous year, and for wire rod by nearly 112%. In January 2015, Chinese exports to the UAE increased by 186% compared to January 2014. Turkish exports to the UAE for rebar grew by 28% to 1.33 million tons in 2014 compared to 2013. A significant growth in exports of around 88% for rebar was achieved in January 2015 compared to January 2014.