Russian government to lift restrictions on sales of Ukrainian pipe on its market – Putin

The Russian government will lift restrictions on the sales of Ukrainian-made pipe on the Russian market, Russian Prime Minister Vladimir Putin said.

"Today we will make the decision that Ukrainian pipe producers have long been waiting for, and 260,000 tonnes of Ukrainian pipe will be sold on the Russian market," Putin said at a conference in Sochi on Tuesday.

The sales will mainly be for Russia's pipeline system operators, Gazprom and Transneft, Putin said.

The Ukrainian prime minister had asked for prompt action to remove trade restrictions. "Ukraine has made an analogous decision concerning chemical products," Putin said.

It was reported earlier that given the lack of an agreement between Ukraine and Russia on duty-free quotas in the second quarter, the Russian side levied anti-dumping duties, a source in the Economic Development Ministry told Interfax. The quota was 55,000 tonnes in the first quarter. Ukraine proposed a quota of 300,000 tonnes in 2010 and the Russian side proposed 223,000 tonnes.

The Russian Economic Development Ministry and the Ukrainian Economy Ministry signed a protocol on December 30, 2009 regulating the duty-free quotas on certain types of steel pipe exported to Russia. The quota for 2010 was based on "the actual deliveries by the Ukrainian participants in 2009." The size of the quota was to be firmed up in February 2010. At the end of March Deputy Economic Development Minister Andrei Slepnev met with representatives of the Economy Ministry, which failed to achieve a final agreement on the quotas for the second quarter.

Russia imposed anti-dumping quotas on imported pipe from Ukraine on December 29, 2005 for five years (until January 30, 2011). The duty on pipes for oil and gas was 8.9%, for bearing - 55.3%, for casing - 11.4%, for pump and compressor - 18.1%. Under a special agreement, five pipe makers, which are now part of the Interpipe holding, received the right to duty-free exports to Russia. The special quota for seamless pipe was 411,000 tonnes in 2007, 419,000 tonnes in 2008 and 427,600 tonnes in 2009.

A Russian industry association, the Fund for the Development of the Pipe Industry, had asked the government to cancel the preferential treatment for the Interpipe group beginning with the second quarter.

Interpipe is controlled by Ukrainian tycoon Viktor Pinchuk and members of his family.