EU bans Russian SR, carbon black imports

BRUSSELS—When the European Union adopted its 10th package of sanctions against Russia to commemorate the one-year anniversary of the nation's unprovoked invasion of Ukraine, it included a ban on imports of Russian synthetic rubber and carbon black.

But the ban for those critical materials for the tire and rubber product industries comes with a caveat: It won't take effect until July 1, 2024.

In the meantime, there will be quotas in place that will allow Russian imports of 562,973 metric tons of synthetic rubber and 752,475 tons of carbon black, totals based on historical import data, a spokeswoman for the European Commission told Rubber News.

Poland, in negotiations leading up to the adoption of the new sanctions, had requested that the ban on SR be part of the package.

There was opposition to Poland's request, however, as it was reported that several EU nations were against banning the imports, as tire manufacturers from these nations in the past have relied on Russian supply to meet its production needs.

In addition, about 54 percent of Europe's total carbon black capacity historically has come from Russia, Ukraine and Belarus. This led to shortages early in the war that impacted tire and other rubber product manufacturing in the EU.

As the anniversary of the Russian invasion neared, it was the debate on the proposed SR and carbon black import ban that held up the EU Council's adoption until late on the Feb. 24 anniversary, according to multiple reports.

When the European Commission released details of the new sanctions Feb. 25, it said the bans on synthetic rubber and carbon blacks, along with bitumen and related materials like asphalt, targeted "high-revenue goods" that covered EU imports worth almost $1.38 billion.

The bans come on top of about $95 billion of imports already sanctioned, in total representing 58 percent of the EU's 2021 imports from Russia.

But the bans on Russian imports of SR and carbon black won't take effect for more than 16 months from the date of the announcement. The EC spokeswoman said the quotas are pro-rated from the annual EU imports from Russia prior to the invasion, which were roughly 415,000 tons for SR and 550,000 tons for carbon black.

She added that the EC and national customs authorities monitor imports into the EU and that the quotas cannot be exceeded, as volumes above the permitted threshold are banned from being imported.

The war in Ukraine has had a detrimental impact on the European tire market, as sales rose in the first half of 2022, but dropped markedly in the last half of the year, according to data from the European Tyre and Rubber Manufacturers' Association.

While the import of tires from Russia was among the earlier sanctions imposed by the EU, the shipments of SR were allowed to continue, though some tire makers in Europe tried to cease buying Russian rubber as a show of support for Ukraine.

Reports indicate they were able to replace roughly two-thirds of their needs from other nations, but often at higher costs, cutting deeply into margins. Industry data said that Russian imports accounted for half of European imports of SR before the invasion, but that percentage dropped to about 30 percent of the imports for 2022.

The Houston-based International Institute of Synthetic Rubber Producers said Russia is a major supplier of BR, one of the main elastomers used in tire production. It also supplies IR, IIR, ESBR and SSBR on a lower scale.

Synthetic rubber producer Synthos S.A. of Oswiecim, Poland, had lobbied for the ban of Russian SR imports, with some criticizing the supplier for trying to increase prospects for its own business.

Synthos officials couldn't be reached for immediate comment on the ban, or how it will be implemented. But given its position in a nation bordering Ukraine, the Polish SR producer has strongly supported its neighbor since the war began.

"Synthos has never been ambivalent about its support for Ukraine. However, we understand that our position can only be understood by those who see the effects of the Russian invasion on a daily basis," Synthos said in a statement supplied to Rubber News.

As for carbon black, both suppliers and customers in the EU carefully monitored Russian carbon black imports in 2022, Martin von Wolfersdorff of Berlin-based Wolfersdorff Consulting, said in a LinkedIn post. He said that Russian carbon blacks still are the cheapest available, though import volumes are down.

"Alternative carbon blacks from India and China have not only been more expensive than Russian carbon blacks, but even more expensive than European carbon blacks," he wrote.

"... I imagine the difficulty for the EU tire industry to replace all Russian carbon blacks with other carbon black grades of better ethical sourcing by June 30, 2024."

In its statement outlining the new sanctions, the EC said its sanctions against Russia are proving effective. "This package is turning up the pressure in response to Putin's brutal war, including viciously targeting civilians and critical infrastructure," the EC said.