Ukraine can

from February to abolish duties on imports of ammonium nitrate Russia. According to unofficial data, this step will be the answer to an extension of Russia agreement to regulate the supply in the country of certain types of Ukrainian pipes. Russia"s mineral fertilizer producers are counting on a sharp increase in demand for their products. Domestic same fear that this may be their biggest problem.

Interagency Commission on International Trade on January 14 would consider lifting the nine months of anti-dumping duty on imports of ammonium nitrate from Russia. If the decision is taken, the zero rate will be effective from February 1. Fee of 11,91% Ukraine introduced in June 2008 for five years, for Dorogobuzh (included in the "Akron") and Evrokhim it was 9,76% and 10,78% respectively. The reason for this was the anti-dumping investigation initiated by the Union of Chemists of Ukraine, which includes the largest Ukrainian manufacturers - Cherkassy, Rovno and Severodonetsk Azot and concern "Styrene".

volume of Ukrainian market of ammonium nitrate in 2009 totaled 1.4 million tons (400 thousand tons less than the year before), of which about 25% was imported from Russia. Average price of fertilizer was $ 180-185 /t. Current cost - about $ 195-220 /t on the border with Ukraine.

Sources in the Ministry of Industrial Policy and the Economy Ministry noted that the fee may be canceled in response to Russia"s decision of 30 December to extend the agreement to supply a number of Ukrainian pipes. In a letter dated 12 December Russia"s Prime Minister Vladimir Putin asked Prime Minister Yulia Tymoshenko. At the same time, Moscow began an antidumping investigation against Ukrainian pipes, and the quota has been established only in the I quarter (55 tons).

"Now that the good are sold fertilizer, Russia will focus on its market, so before the end of April I have problems with the abolition of the fee can not see, - said the deputy director of sales Cherkassy Azot Andrei Kovalenko .- But in May it will be very big problem. When we and the Russians in the offseason will have nowhere to do with nitrate, they can dump - and will have to stop our factories. Top manager adds that Russia"s major producers of raw materials - gas - costs about four times cheaper than Ukrainian.

Chapter Board of Directors of Akron"s "Alexander Popov has confirmed that the peak demand for fertilizers will be in the spring. According to him, if the fee canceled, the company or keep the price at the current level, causing a sharp increase in supply, or raise it in the size of the fee. A spokesman Evrokhim Vladimir Torin said that the company as a bona fide member of the market welcomes the abolition of fees, but stressed that now it remains a priority for the domestic market. Supply of ammonium nitrate Evrokhim in Ukraine in 2009 amounted to 79 thousand tons

analyst IR Dragon Capital Tamara Levchenko says that last year the Ukrainian plants and so sold nitrate with minimum profitability. Its cost was about $ 200 /t, and the selling price ranged from $ 160-220 /t on FOB Black Sea ports.

"The cost of Russia"s nitrate significantly lower, as chemical plants for Russia to use natural gas costs about $ 70 per thousand cubic meters, and for plants in Ukraine, it was $ 240, - analyst .- Thus, in 2009 Russia imported nitrate in Ukraine at a price below the Ukrainian at $ 5-10 /t, even if the fee or, if the lifting of import volumes may still increase significantly. According to the analyst, tb81he Russians will be beneficial not to lower the price. Elena Sakhnova from VTB adds that the greatest impact on reducing taxes will Dorogobuzh, enterprises which are located closest to the markets, which reduces logistics costs.

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