UAE Slaps 5% Import Duty on all Turkish Rebar from Jan 5

The United Arab Emirates has announced a 5% import duty on all Turkish reinforcing bar effective from January 5 without exemption, a move that effectively blocks one of Turkey's largest seaborne export markets for the product, market participants informed Platts Steel Business Briefing on Jan. 04, 2013.

The move will include all January arrivals, with one shipment understood to be due to arrive on January 13 from a Turkish EAF producer. Two mills regularly sell around 70,000-80,000 metric tons/month to the UAE.

Reinforcement fabricators in the UAE were exempt from import duty if they processed the steel arriving in Jebel Ali through cutting or bending, but now all importers are included under the January ruling. "The local authorities believe that many fabricators do not actually have processing equipment, so they are avoiding the import tariff," one stockist said. "This customs duty will now be paid because not even fabricators are exempt."

Most of the Turkish material (up to 70-80%) was arriving duty-free under the cut-and-bend exemption policy, local stockists believe.

Market participants concurred that this could see dormant rolling capacity restarting in the UAE as the market would be insulated from Turkish imports, which is seen as positive for billet sellers. The full application of the 5% duty on rebar imports to the UAE is another blow to Turkey's longs exporters, after another important market - Egypt - imposed a temporary 6.8% duty on finished longs imports in Q4 2012.

Emirates Steel Industries, the largest local steel producer, is understood to be considering a hike of nearly 5% for January rebar output on the back of the import duty.