Although the EU introduced sanctions on imports of Russian steel, Moscow managed to exploit gaps in the enforcement policy to avoid the restrictions, while EU steel makers are hurting from sky-high energy prices, German business news magazine Wirtschaftswoche said on Sep. 2.
Despite EU-wide sanctions introduced in March, some Russian companies continue to export to Europe, Wirtschaftswoche reported.
In particular, the article mentions a certain Russian steel enterprise, “ex-porting its goods to European markets, via a Belgian subsidiary – completely legally, observing all customs checks.”
While Wirtschaftswoche did not explicitly name the company in question, NV Business is aware the article was talking about NLMK, owned by Russian oligarch Vladimir Lisin. The company’s EU business is co-owned by NLMK Belgium Holdings SA and SOGEPA (Société Wallonne de Gestion et de Participations SA) – both Belgian-registered entities.
Citing official customs data, Wirtschaftswoche reported that the EU accounted for 40% of Russian steel exports in the first five months of 2022, compared to 37% for the same period of 2021.
Using loopholes, Russia maintains over half of its EU steel exports – 4.7 million tons.
“It’s doubtful that Russian companies will manage to do business that way, long-term,” Wirtschaftswoche concluded.
While Russian steel producers benefit from a near-limitless supply of cheap natural gas, European producers are battered by soaring energy prices.
As an example, ArcelorMittal announced it’s shutting down parts of its metal business in Germany and Spain. According to the company, high gas and electricity prices are to blame.