In early November there took place a long-expected meeting between representatives of industrial sector and trade & economic missions of Ukraine. Today issues of strengthening its positions on sales markets and entering new markets are very acute to Ukrai




In early November there took place a long-expected
meeting between representatives of industrial sector and trade & economic missions of
Ukraine. Today issues of strengthening its positions on sales markets and entering new
markets are very acute to Ukraine. Metallurgists were the first to face these problems.
Metallurgy is the most export-oriented industry – up to 80% of metal produce is
exported. At the meeting, Vladimir Boyko (Ilyich Iron & Steel Works) stated that it is
important for trade & economic missions to more actively participate in monitoring of
the markets and timely advise of changes in legislation of the countries, where they are
located. Deputy director of PbJSC Motor Sich drew the participants’ attention to the
so-called internal questions of the procedure of arranging contracts, such as export
control. There were also discussed questions regarding payment in a 90-day term,
conditions of payment, the form of final consumer certificate, etc.

Representatives of trade & economic missions
stressed that exporters and producers must take active part in exhibitions and advertise
their products. Besides, there was mentioned weak international management, and shortage
or absence of Ukrainian metallurgic representative offices abroad.

During the conference, The Metal asked representatives
of trade & economic missions for their comments on sales promotion of Ukrainian
produce on markets of the countries they work in. Will Ukrainian metallurgists manage to
maintain their positions on these markets?

Vladimir BOYKO, General Director, Ilyich Iron &
Steel Works

– Today we are defending our interests on the
international markets ourselves. Trade & economic missions should assist Ukrainian
enterprises to enter the world markets, to find their niches on these markets and to
defend themselves against local legislation. Today the world market is experiencing the
downswing. Everyone understands that this year currency income to Ukraine’s budget will
plunge. Profitability of many metallurgic mills is going down considerably. The main
question for today for Ukrainian metallurgy is how to stay afloat. I would like us to
develop approaches to a fruitful cooperation at this meeting.

Vladimir TERESHCHENKO, Executive Director of

– Metallurgy, as an export-oriented industry, is ridden
by the situation and trends of the world market. This happened due to plunge in Ukrainian
domestic consumption of metal (from 300 kg per year per capita in 1989-1990 to no more
than 40 kg at present). Therefore, today metallurgists try to cover this gap with exports.
As a result, since 1992 till 2000, 86 antidumping inquiries were launched against
Ukrainian metallurgists, including 60 – against supplies of metal from Ukraine to
different countries. Obviously, we have to create an organization that would coordinate
all efforts of trade & economic missions in order to help exporters of metal produce.

The time came to settle organizational questions and to set
concrete goals. Firstly, it is necessary to determine Ukraine’s position as that of a
country with the market economy status. Secondly, representatives of trade & economic
missions should inform metallurgists about changes in legislation of countries they work
in on a regular basis, so that Ukrainian metallurgic enterprises could undertake timely
measures and avoid new antidumping inquiries. Thirdly, there is a question regarding
tenders. Oftentimes this information comes to metallurgists too late. Information about
tenders should, first of all, be forwarded to associations that are engaged in particular
sectors and can quickly contact respective enterprises and forward the documents.

We need to coordinate our work with trade & economic
missions and set before them objectives, which, when achieved, will help Ukrainian
enterprises to operate steadily and effectively.


Mikhail YURYEV, Trade & Economic Mission of
Ukraine in United Arab Emirates

– United Arab Emirates is a unique country, which,
firstly, does not have antidumping legislation, and, secondly, internal taxation. All
import duties total 4% maximum. Most projects in the country are worth billions of
dollars. Exporters should pay attention to this part of the world, where the market is
very favorable for Ukrainian commodities. There are 7 free economic zones in the country,
and, besides to exports of the commodities, export of technologies is also possible.

Along with that, there are many international exhibitions
held in United Arab Emirates, but Ukraine is not presented there. This issue must be also

Stanislav SIVOKON, Head of Trade & Economic
Mission of Ukraine in the Russian Federation

– Turnover of trade with the Russian Federation in
January-September 2001 was maintained at US$ 4.6 billion.

I hope that Ukrainian tube manufacturers won’t leave the
Russian market as a result of antidumping investigations held by the Russian side.
Negotiations on this issue are being actively held by our countries and must be over by
the end of the current year. As it is known, in compliance with the reached agreement,
Ukraine limited its tube exports to Russia and lowered supplies by 620,000 tonnes.
However, the situation is still not easy. Every country, first of all, protects
development of its own domestic market and producers.

As regards foundation of Ukrainian-Russian Tube
Corporation, at present enterprises-participants are working on this issue by themselves.

To our mind, we would be able to expand exports of
Ukrainian produce to Russia provided that the Russian market receives more information on
our possibilities. We do not use all the possibilities to present Ukrainian regions,
producers, commodities and Ukrainian special economic zones. For example, there are 162
representative offices of Russian enterprises working in Ukraine, whereas there are just
60 representative offices of Ukrainian producers in Russia.

Andrey BEREZNIY, Head of Trade & Economic
Mission of Ukraine in Switzerland

– Domestic market of Switzerland is quite small. However,
it is a unique center of European logistics, to which all technological schemes and
financing are connected.

Switzerland is not a member of the United Nations and the
EU. It is a free-trader, and there are no limitations on imported commodities.
Unfortunately, so far Ukrainian industrial producers cannot conclude export contracts.
They are not able to comply with the lists of commodities required by the Swiss clients.
This is a highly competitive market and planned economy with stable operation and specific

Rostislav ZATSEPILIN, Head of Trade & Economic
Mission of Ukraine in India

– It is worth mentioning that Ukraine and India are
competitors in the sector of steel production. 90% of Indian metallurgic mills were built
by Ukrainians, which continue to work as before. India buys billets, strips, sheets, tubes
and other metal products in Ukraine, but, at the same time, launches antidumping inquiries
and introduces special taxes. In 2000, we won antidumping lawsuit regarding billet
supplies and continue to export billets to India. Trade & economic mission in India is
waiting for offers from Ukrainian metallurgic mills regarding supplies of billets to
India. For domestic consumption, India buys Ukrainian hot-rolled sheets and plates, and
sells its own. Indian consumers are interested in ferrosilicon and ferromanganese
additives, and also in large-diameter oil tubes.

Capacity of Indian market for oil tubes is huge. It is
expected that in 2002 5,000 km of pipelines will be launched, and 5,000 km more – in the
following year. Ukrainian tube manufacturers have a chance to win tenders for tubes,
provided that they are persistent enough.

Miron YANKIV, Head of Trade & Economic Mission
of Ukraine in Poland

– Polish market is very capacious, and it is developing
fast. Significant growth takes place in metal consuming industries, first of all,
shipbuilding. Polish shipbuilders are interested in cooperation with Ukrainian
shipbuilding plants, and, which is more important, they consume Ukrainian-made hot-rolled
plates. There are many requests from enterprises of other industries, such as construction
industry, mechanical engineering and agricultural machinery industry. Ukrainian
manufacturers could supply their produce to these industries. Polish businessmen are
interested in cooperation with Ukrainian commodity producers. However, Ukrainian
enterprises must start participating in tenders (for example on supplies of hot-rolled
plates for shipbuilders, transport, and other industries), exhibitions, trade fairs, etc.
Ukraine can also supply oil tubes to the Polish market.

Konstantin MARUSHEVSKY, Deputy Head of Trade &
Economic Mission of Ukraine in China

– In 2001 Ukraine’s turnover of trade with China is
expected at over US$ 800 million. Ukraine’s positive trade balance is twice as high as
the Chinese import, of which metal accounts for 90% (slabs, square billets, cold-rolled
and hot-rolled coils).

China has a system of import licenses, with the help of
which the government regulates saturation of the market with different commodities. In the
second half of this year, Chinese government suspended issuance of the licenses, since the
sales market for Chinese metal traders shrank. It is worth mentioning that China is one of
the biggest producers of metal commodities, which are not expensive, but at the same time
of a poor quality. Along with that, consumption of metal in China continues to grow, and,
obviously, will continue growing in future. The problem is that Ukrainian metallurgic
mills do not manufacture the products that are needed today on the Chinese market.

Since August 2001 prices for metal in China have been
decreasing. The situation on the market is quite unfavorable for Ukrainian producers.

The time came to open joint ventures with Chinese
enterprises. According to Chinese law, if a joint venture manufactures, say,
small-diameter tubes for domestic consumption, then all imports of metal produce is not
subject to licensing. However, Ukrainian metal producers do not undertake any steps in
this direction.

Anatoliy VRUBLEVSKIY, Deputy Head of Trade &
Economic Mission of Ukraine in Germany

– The portion of Ukrainian produce in German imports is
small. Metal segment of the marker is already occupied. However, it might be worth trying
to compete with other countries, such as Russia, the Czech Republic, Slovakia and Hungary,
on the German market. Ukrainian producers have to defend their positions on international
markets. The quality of produce must comply with the world standards. Besides to that, it
is necessary to open representative offices in Germany. Today there are no representative
offices of Ukrainian metallurgic enterprises.

Vasiliy ANDRIASHCHUK, Deputy Head of Trade &
Economic Mission of Ukraine in Austria

– The main task of trade & economic mission is to
assist Ukrainian exporters, and also to look for new sales markets. For that purpose, we
need to closely cooperate with Ukrainian producers and to obtain concrete offers from
Ukrainian companies. Today Austria imports a lot of ore and pellets from Poltava Mining
& Concentrating Works.

We are looking forward to receiving offers from
manufacturers and exporters and hope for fruitful cooperation.


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