Import rules remain Europe’s key steel price influence

Further changes to trade defence measures in the EU and United Kingdom will influence steel prices more than any shift in supply or demand this summer, MEPS respondents say.

As the holiday period slowed trading to a near standstill in August, the European Commission launched a new antidumping investigation into hot rolled flat products imported from Egypt, India, Japan and Vietnam. Meanwhile, the UK’s Trade Remedies Authority (TRA) proposed changes that would effectively triple the volume of tariff-free hot rolled flat product imports permitted under the country’s trade defence rules. 

The changes are expected to tighten supply to the EU, applying upward pressure to steel prices. Downward price pressure is likely to be exerted in the UK, meanwhile, due to the mitigation of expected supply pressures. 

• This content first appeared in the August edition of MEPS's European Steel Review. The monthly report features steel prices, price indices, market commentaries and forecasts from across the region. Contact MEPS for details of how to subscribe.

The EU antidumping investigation was launched in response to a complaint filed by Eurofer on June 24. The Commission said evidence had been provided that imports of the products under investigation, from the countries concerned, had increased in terms of overall volume and market share. Eurofer alleges that this reduced the quantities sold, prices charged, and the market share held by EU steelmakers. 

The period to be investigated by the EU antidumping investigation will cover the period from April 1, 2023, to March 31, 2024. Although the investigation will be completed within a year, provisional duties could be applied within seven to eight months. Steel buyers told MEPS that this, and the risk of retrospective antidumping duties against imports from Egypt, India, Japan and Vietnam, will reduce confidence in overseas purchases in the near term. It comes just over a month after the implementation of a 15% cap on individual nations’ use of the EU’s quarterly “other countries” quota for hot rolled coil. 

European importers say that further EU trade defence measures on Category 1 steel – in addition to the rollout of CBAM – will harm the competitiveness of European steel processors and service centres. They have called for new restrictions on imports of finished products to mitigate this effect. 

Three-fold growth of UK flat product import quota 

In the UK, steel importers have welcomed a Trade Remedies Authority (TRA) proposal that would effectively treble the volume of hot rolled flat product imports permitted under the country’s trade defence rules. 

Publication of the TRA’s plan comes in response to Tata Steel UK’s increasing reliance on imports as it transitions to EAF-based steel production. One of two blast furnaces at its site in Port Talbot, South Wales, was decommissioned in July. Its second will cease production in September, with the development of an EAF not expected to be completed until 2027. 

UK steel importers have said that Tata’s reliance on imports of hot rolled coil – predominantly from its mills in the Netherlands and India – will place significant pressure on import quotas. This would potentially increase the application of a 25% tariff, raising steel prices. TRA investigations discovered that the current Category 1 steel quota was fully utilised in every quarter between April 2023 and March 2024. 

In response, the TRA has proposed the creation of a new Category 1B segment which will be set aside for material imported for the purpose of downstream processing into other products. Tata Steel uses hot rolled steel produced at Port Talbot to make cold rolled coil, coated steel and tubular steel. 

As such, the proposed Category 1A quota would be reserved for commercial applications and remain around the level of the current Category 1 quota – just below one million tonnes per year. Category 1B is significantly larger, at 1.9 million tonnes. 

The TRA said that the Category 1B quota would be “allocated on a global basis”, allowing companies to establish reliable supply chains. A cap in the range of 37-42% will be applied to ensure no single country’s exports dominate this new quota.