Italian steel distributors, service centres and traders’ association Assofermet has written to the European Commission opposing a tightening of safeguard quotas and possible anti-dumping duty on Turkish hot rolled coil.
Assofermet requested the EC take into consideration the fact that a reduction of safeguard quotas would harm European importers holding contracts for deliveries up to September 2020. These have been signed in good faith in compliance with existing rules.
“[A change] would be unfairly penalising for the European distributors and consumers holding contracts duly signed in good faith for delivery up to September 2020,” Assofermet says in the letter. “We strongly require that any change in the current system will allow exemptions for all the contracts signed before the publication of the revision.”
The association also says any change further supporting steel producers would be unfair. “The shock to the steel business has been asymmetric with consumption and distribution severely hit and steel production affected to a much lesser extent,” it continues in the letter seen by Kallanish. “During the lockdown period steel mills have been permitted to continue to produce, granting them favourable treatment with respect to all other economic actors.”
Assofermet rejects Eurofer’s request to drastically limit safeguard quotas as well as lower the 30% cap for single importing countries. The quarterly allocation of quotas should be eliminated, it adds.
“Revising the current Safeguard system, with measures that could additionally limit the possibility to import, could choke from the very beginning the recovery of the European economy,” the association explains. “After the drawdown that will be recorded in Q2 2020, we expect a significant rebound in steel consumption in Q3. At the same time, European mills are reducing their production, albeit with a significant delay. This will lead to a possible shortage of steel in Q3, when the tighter measures would be in place according to the request of producers.”
Assofermet also opposes the imposition of an AD duty on Turkish HRC. It notes that European mills are similarly selling into Turkey and that Turkish mills are offering to European clients at prices above their respective domestic market levels. This indicates dumping is not taking place.
