Arcelor Mittal severely damages Romania's economic interests

Publish date: 10-08-2009
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Recent press information show undoubtedly that industry giant Arcelor Mittal is playing an unfair game on the Romanian market, at least in the field of raw material transportation.

According to recent information released by Agerpres, Romania's official press agency, Arcelor Mittal has decided to move its bulk raw material transportation and handling activities to the Bulgarian port of Bourgas, bypassing Constanta and thus damaging the economic interests of Romania.

According to one such contract (excerpts follow below), dated July 13th 2009, Arcelor Mittal negotiated for the shipment of a full cargo of iron ore from Bourgas to Galati via Bystroye Channel for the freight rate of EUR 7.80 pmt FIOT.

The facts speak for themselves: the commodity is iron ore (as shown at no. 12), the charterer is Arcelor Mittal (no. 4), the loading port is Bourgas (no. 11), the discharging port is Galati (no. 11), the vessel sails under Bulgarian flag and is named Sozopol 1 (no. 5), has a carrying capacity of DWT 3.261 (no. 7) and the freight rate pmt it charges is EUR 7.80 FIOT, to which adjacent costs will be added.

This is happening while the terminals in the port of Constanta can operate ships of up to DWT 220.000 (which would significantly decrease the shipment costs), while the unloading rate at these terminals is at least twice the unloading rate of the terminals in Bourgas (which would again cut costs). These advantages of Constanta as compared to Bourgas lead to a total cost of shipment of EUR 5.77 pmt in Constanta for commodities like iron ore, while in Bourgas the cost could climb up to EUR 16-19 pmt.

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