Russia will peg its export tariff for copper, currently fixed at 10% of the customs value of the metal to metal prices on the London Metals Exchange.
An order published on a government showed that the tariff which is likely to be applied some-time next year will be set on a quarterly basis. It will be higher than the current one if prices top USD 8,000 per tonne and will not be levied if they fall below USD 6,000 per tonne.
The order will become effective one month after it is officially published in the government newspaper, Rossiiskaya Gazeta which normally happens within days of the web site publication. But the new tariff will be set only from the fifth day of every third month following a quarter for which the Ministry of Economic Development is to calculate the average LME price.
The order said that the ministry is to present to the government its calculations no later than on the 20th day of the month following the quarter for which the price will be calculated. The tariff will be equal to zero if the copper price is below USD 6,000 per tonne.
If the price ranges between USD 6,000 per tonne and USD 8,000 per tonne the tariff will be equal to 10 percent of the average quarterly price. If the price is above USD 8,000 per tonne, the tariff will be calculated by the following formula: USD 8,000 will be deducted from the actual price, the difference will be multiplied by 0.3 and USD 800 will be added to the result.
At the current copper price of around USD 7,448 per tonne the tariff would be practically unchanged from what the government applies now. Russia's top producers of copper are Norilsk Nickel and privately owned Urals Mining and Metals Co and Russian Copper Co.
The government has said that it examined plans to peg ferrous metals tariffs to the market prices of metals in order to provide fair revenues to the budget. It has so far set a floating nickel tariff. Last year the government restored the 10% copper tariff it had lifted in February 2009 to help local producers to cope with the global economic crisis.
(Sourced from www.brecorder.com)
