EU probe into Chinese HDG includes auto grades: sources

Automotive grade hot-dip galvanized sheet is included in the European Commission’s investigation of Chinese coated material, according to a source at an association that received a clarification.

Numerous market players noted confusion over the official notice of the investigation, announced Friday December 9, and whether it excluded automotive grades. Many explained the omission by making comparisons to a previous investigation into Chinese HDG, launched in 2007, that ended without a duty following feedback from the automotive sector.

“An anti-dumping investigation into hot dipped galvanized coil from China will not have a negative impact on the EU automotive industry as the anti-dumping probe will not cover the HDG for the automotive sector”, Axel Eggert, Eurofer general director, told S&P Global Platts.

A lawyer based in Brussels concurred based on the guidelines in the notice. “Looking at the specification market players confirmed to me that the HDG for the automotive is excluded, as was demanded by the strong automotive industry lobby. They lobbied very hard as they needed materials and they have open contracts.”

However, the association source said he had met representatives from the EC earlier this week and they had clarified there was a mistake in the official notice and automotive grades are included. “We do know for a fact that it is included. That was just a mistake in the original specification,” he said.

Another senior market figure agreed the automotive sector had not been excluded. He said the definition “makes no reference to a specific automotive grade HDG. References to an end use destination of steel imports are unknown in the CN codes governing customs definitions of imported steels.”

The distinction is important as, while imported Chinese HDG is generally not used in the automotive sector, there are implications for other suppliers. For instance, Korean producer POSCO (which does sell auto grade to Europe) is said to be reluctant to send big volumes to Europe to avoid being named in an investigation.

It is understood the EC has set a deadline of December 23 for objections to be filed. The European Commission could not be reached for comment.

Peter Brennan and Annalisa Villa