EU HRC quotas exhausted by key Asian suppliers, while others remain untapped

As of Jan. 10, the European Union’s tariff-rate quota (TRQ) system for hot-rolled coil (HRC) imports has been fully utilized by Vietnam, Japan, and Taiwan, according to the latest data from the European Commission. This rapid exhaustion of quotas highlights the strong demand for competitively priced HRC from these Asian countries, which have been key suppliers to the European market.

In stark contrast, 38% of Egypt’s quota remains available, and countries such as Australia, Switzerland, the United States, Canada, and Libya have not yet utilized any of their first quarter quotas, maintaining 100% availability.

Market participants have noted that the swift exhaustion of quotas by Vietnam, Japan, and Taiwan was anticipated, given the competitive pricing and strong demand for their HRC products. However, the availability of quotas from other countries presents an opportunity for European importers to explore alternative sources, particularly as domestic demand remains subdued. Some sources had previously shared expectations that the EU quotas would be filled quickly in Q1, anticipating high port-side stock levels awaiting clearance from Q4 2024.

Domestic European hot-rolled coil prices have remained largely stable since the start of the year, with no major changes in demand reported. Market participants are cautiously optimistic about potential positive developments in the coming days, although the overall sentiment remains one of wait-and-see.

Platts assessed both Northwest European and Southern Europe HRC prices at Eur570/mt ex-works, up Eur10 on the day.

Meanwhile, Platts assessed prices for imported hot-rolled coil in Northwest Europe at Eur535/mt CIF Antwerp, and in Southern Europe at Eur530/mt CIF Italy, both stable on the day.

Charles Thompson | Devbrat Saha