Category: Latest Updates

EU hot-rolled sheet tariff-rate quota (TRQ) utilisation for the second quarter shows Türkiye and Vietnam drawing down their quotas by 22 April, following the earlier exhaustion and oversubscription of India’s allocation, Kallanish notes.

In volume terms, Türkiye has seen the largest quota drawdown among origins with remaining availability at only 24%, while Vietnam is the tightest within the “other countries” allocations, with just 2% available.

As of 22 April, Türkiye had 96,662 tonnes remaining from its 398,355t allocation. India’s country-specific quota is fully exhausted, with no balance or available volume left. Vietnam had just 2,466t still available.

Among other major suppliers, South Korea retains substantial availability, with 134,726t, or 84%, still open. The United Kingdom and Serbia have 94% and 90% of their quotas still available, respectively.

Within the “other countries” pool, utilisation was mixed. Besides Vietnam, Algeria also showed notable utilisation, with 38% remaining, while Egypt has 67% and Taiwan 64% available. Japan remained still open at 93%, while Switzerland, the United States, Libya and Canada were effectively untouched.

Source: EU TARIC, as of 22 April. Complied by Kallanish

Author: Elina Virchenko

kallanish.com

EU long steel tariff-rate quota (TRQ) utilisation for the second quarter as of 22 April shows the heaviest drawdown concentrated in a limited number of origins, particularly Türkiye and China. Most UK-origin quotas remain largely open, Kallanish notes.

Across the four key long product categories – merchant bar, rebar, wire rod, and angles and sections – the largest absolute quotas are held by the UK in wire rod, China in merchant bar, and Türkiye in rebar and angles/sections.

By 22 April, the most pressured quotas were Turkish wire rod (100% used), Chinese merchant bar (90% used), Turkish rebar (75% used), and Egyptian rebar (92% effectively committed on a net basis). By contrast, UK-origin quotas across multiple longs segments remain largely open.

For merchant bar (category 12), China has an allocation of 140,406 tonnes. However, it is also the most actively used major quota, with only 14,570t still available, equivalent to 10% of the original volume. This implies around 90% utilisation. By contrast, the UK retains 97% availability and Türkiye 73%.

In rebar (category 13), Türkiye has a 94,493t quota, of which 23,711t or 25% is left. Among other origins, Egypt is also heavily utilised, with only 2,109t available, or 8%, once awaiting allocations are deducted. Bosnia and Algeria remain effectively unused.

Wire rod (category 16) shows the most aggressive drawdown of all longs categories. Türkiye has fully exhausted its 98,153t allocation, leaving zero balance. The UK has the largest quota at 163,136t, with 90% still available, while Switzerland retains 88%. Among other countries, Egypt is de facto exhausted with just 53t net available, while Malaysia, Bosnia, Korea and Indonesia remain largely untouched.

For angles and sections (category 17), the UK holds the largest country-specific allocation at 27,208t, with 99% still unused. Türkiye shows the highest effective utilisation, with 13,632t remaining from a 22,643t quota, meaning about 40% has already been consumed. Other origins such as the United Arab Emirates, China and Korea show minimal activity.

Source: EU TARIC, as of 22 April. Complied by Kallanish

Author: Elina Virchenko

kallanish.com

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Global crude steel production fell for a seventh consecutive month in March, by 4.2% on-year to 159.9 million tonnes. Besides India, the US and Germany continued to buck the trend, Kallanish notes from worldsteel data.

China saw output fall 6.3% in March to 87.04mt, but Indian output surged 9.4% to 15.3mt. Although Japanese production declined 4% to 6.9mt, South Korean output inched up 1.5% to 5.4mt.

EU output fell 4.6% in March to 11.35mt, although this was up considerably on February. The on-year decline happened despite German production surging 7.5% to 3.3mt and Italian output inching up 0.2% to 2.06mt. Spanish and French output were however estimated to have slumped significantly.

Turkish output rose 6.4% to 3.33mt (see separate story).

US crude steel production surged 5.2% in March to 7.2mt, but Brazilian output fell 2.5% to 2.8mt.

Russian production was estimated down 11.4% to 5.4mt and Ukrainian output was confirmed to have surged 28% to 702,000t.

January-March global crude steel production thus fell 2.3% on-year to 459.16mt, with India, the US, South Korea, Turkey and Germany bucking the trend.

The European Commission has published a notice of impending expiry for anti-dumping duties on imports of certain grain-oriented flat-rolled products of silicon-electrical steel (GOES) from China, Japan, South Korea, Russia and the US, Kallanish notes.

The current duties were imposed following a previous expiry review. Unless an expiry review is requested and initiated, the measures are set to lapse on 18 January 2027.

EU producers may submit a request for review no later than three months before the expiry date, meaning by 18 October 2026, supported by evidence that ending the measures would likely lead to continued or renewed dumping and injury.

“Green” steel start-up Stegra and electrolyser manufacturer Sunfire believe the EU’s Industrial Accelerator Act needs to go back to the drawing board to boost steel decarbonisation, Kallanish reports.

Debating the act during a webinar hosted this week by trade body Hydrogen Europe, Stegra public affairs director Ola Hansén said the definition of low carbon needs to be reviewed as it is currently not fit for purpose.

“I am sad to say, when it comes to flat steel, hot-rolled coil production [classification and labelling], it was a complete catastrophe,” Hansén claimed. “With the thresholds proposed, all current European flats production will be considered low carbon. All current flat steel production in China would also be eligible for the classification of low carbon … and the US too, meaning that it is not helping the transition.”

“If 100% of current production already meets low-carbon [definition], why put a 25% quota in the public procurement? I mean, there is no sense if our production already meets that,” he said, calling for more ambitious targets.

His counterpart at Sunfire, Christopher Frey, added that industry needs a “transparent and meaningful” labelling scheme for net-zero steel to create demand for green hydrogen and electrolysers, as proposed under the lead market concept. “What we have heard between the lines is a bit concerning. I would agree that we have to go back to the drawing board and make this more meaningful,” he said.

Frey also highlighted the “special relationship” between the steel and electrolyser industries. “We are customers of the steel companies, but obviously we also want the steel industry to drive the demand for green hydrogen and for our products … We source quite a lot of steel for our electrolysers and exclusively from Europe,” he noted.

Sunfire and peers estimate the steel industry could potentially provide around 9 gigawatts of electrolysis demand if the right framework is in place. Yet, Frey acknowledges the steel industry is facing strong competition, which is challenging decarbonisation efforts.

Stegra sees the proposed low-carbon steel credits “as the most promising lead market … more than any Industrial Accelerator Act.” Hansén explained that having quotas for low-carbon steel usage in the automotive sector, for example, will provide investor certainty and help unlock progress in different industries. “In the end, the additional cost of a couple of hundred euros, if you use only low-carbon steel, compared to the price of a car, is very limited,” he said, referring to a shared development approach.

Italian rebar transaction prices are holding stable week-on-week despite producers continuing to push hard for further increases, Kallanish learns. The market appears to have reached a standstill, with buyers refusing to pay the new asking price of €440/tonne ($517.55/t) base ex-works.

Multiple buyers say they are unable to pass increases on downstream. One construction company has decided to postpone future building projects due to sharply rising raw material costs, including for steel and cement. The company says it cannot absorb an average cost increase of around 40% and is scaling back activity in an effort to preserve a slim margin.

The rapid succession of price increases in Italy following the US-Iran conflict has left Italian rebar among the most expensive in Europe.

Large buyers have stepped back from the market, relying on their stocks. Smaller buyers continued to purchase until last week at €410-420/t base ex-works, limiting their purchases to a few truckloads at a time to cover immediate needs only. Including size extras of €260-270/t, effective transaction prices for Italian rebar are currently assessed at €670-680/t ex-works, up from an average of around €540/t at the start of March, sources suggest.

Mills are maintaining an uncompromising attitude, preferring to lose orders rather than decrease prices, even as sales volumes remain tight. Sources note that if sales continue at current low levels, producers will eventually be forced to reduce output.

Many buyers are questioning how long mills can maintain such rigidity. “There is a will to buy and work, but the market is now stuck and we don’t even know if we will manage to pass on the €410/t downstream,” one source comments.

Italian long products service centres and distributors report a quiet April following an improved March. Multiple companies tell Kallanish that downstream consumption remains limited amid deep concern over rapidly rising prices, cost inflation and cutomers’ financial difficulties.

Two purchasing groups report widespread payment delays with buyers unable to absorb current increases. Mill forecasts of demand improvement in the second quarter are not supported by any positive consumption signal or economic indicator. The Italian economy, which outperformed France and Germany last year, is now slowing, with depressed industrial production growth for several months.

“Customers buy day to day and only in small volumes. I tend to buy second-choice material, which can be of very high quality, and we have some work but not enough to be able to pay the €100/tonne ($117.62/t) plus increases producers are asking. Steelmakers have now become a powerful lobby and are so protected they will be the only ones able to make a profit this year with a disastrous effect downstream that will sooner or later backfire,” one service centre source comments.

Distributor prices are struggling to move higher despite what one purchasing group describes as “producers’ determination to keep the market tense”. The source notes this is not solely an Italian issue. Some of the lowest coil derivative prices in Europe have been recorded in Germany.

Since the close of the Tube and Wire trade show, German buyers have resumed some restocking activity, though not at increased prices. German values have also been impacted by high import volumes in the first quarter, particularly of tube from Turkey. However, the combination of the melt and pour regulation and new safeguard is expected to limit imports, which should push German tube prices higher.

Despite this support, Italian tube consumption remains in line with 2025 levels, the purchasing group source says. A member of the second purchasing group laments a complete lack of visibility in tube sales and difficulty passing increases on downstream.

One longs agent says he is confused by the succession of increases, noting no visibility and order sizes of between 30 and 90 tonnes, making it difficult to advise customers.

Several sources believe the current disconnect between the steelmaking and end-use manufacturing sectors will bring the market to a standstill within months, with the consequences only felt upstream after some lag.

One source adds a wider policy critique: “The key was not adopting Trump-style protectionism, as Europe is doing, to only protect one segment of the industry, producers, but stimulating demand. This strategy, however, is not in line with current and future European policies.”