The European commission has officially opened an antidumping investigation into imports of hot-dip galvanized coil from China. This had been widely expected by the market following the complaint lodged in October by domestic producers.
While provisional measures could be imposed in September 2017, the possibility of the addition of retroactive measures is already making the trade of HDG from China into Europe grind to a halt. It is understood retroactive measures could impact arrivals from the beginning of June onwards, with current new orders expected to arrive in Europe not before the beginning of May.
As previously reported by Kallanish, the investigation was launched before the WTO deadline for classifying China as a market economy in trade cases. This has given the European Commission the opportunity to set the prices in the Canadian market as the base level to which Chinese prices will need to be compared in this latest investigation.
China is in line to export some 2 million tonnes of HDG this year to Europe, well above the 1.7mt exported in 2015, as reported. Traders in Europe commented that currently in the market there isn’t any potential other source capable to replace these imports into the EU, implying therefore that the market might feel a shortage of HDG in Europe as well as tension in prices.
“Going forward these investigations will only increment the risk of delocalisation by manufacturers in Europe importing Chinese steel, and will support a price rise in finished goods for the wider public,” a trader said. “European mills this year are making good margins on their sales and the Chinese imports are only an excuse to protect the market.”