UK-based International Steel Trade Association ISTA considers that the UK government’s proposed continuation of some steel import curbs and quotas after June 30 may not allow the flexibility of supply and demand needed to support UK consumer industries’ recovery.
“ISTA is disappointed that the measures announced by TRID (the Department of International Trade’s Trade Remedies Investigations Directorate) do not go far enough to allow the flexibility of supply and demand needed in today’s market in order to support UK consumer industries and economic recovery. In particular, the restrictions placed on reinforcing bars and structural hollow sections would actually hamper that recovery,” the association said in a statement over the weekend.
On May 19 TRID published an intended preliminary decision to extend UK steel import safeguards and tariff rate quotas for three years from July 1 on certain product categories, including hot-rolled sheets and strips, cold-rolled sheets and rebars, where imports have been “significant.” This will cover 102 product codes.
Imports of other products deemed not to have been imported in significant quantities, or which are not produced in the UK or have not caused serious injury to domestic producers, including some metallic coated sheets, tin mill products and stainless bars, involving 135 product codes, are however proposed to be freed from quotas.
TRID has invited feedback from interested parties on the proposed measure by May 26.
ISTA argues that UK import quotas should be significantly increased, particularly as UK steel demand is met by both domestic steel producers – currently enjoying high margins due to record-high steel prices – and by imports.
Imports had a 60-65% market share in 2019, with the EU accounting for 40%; Turkey 8% and South Korea 4%, according to ISTA, which includes some 80 companies including international traders, importers, stockholders and shipping companies.
ISTA questioned in its statement the grounds on which the “out-of-quota safeguarding duty of 25%” – a penal levy for tonnages exceeding quota limits – has been continued.
Global trends ‘changing’
“Its origins lie in the USA 232 [import tariff] measures and subsequent EU reaction from three years ago, and the same levy appears to have been carried over without any commercial calculation or consideration for changing global trends during the intervening three years,” ISTA said.
It notes that for some product categories, EU quotas may now be increased to the detriment of steel from other origins.
After leaving the European Union, the UK “transitioned” the existing EU tariff rate quotas, introduced in 2018 under its safeguard scheme, to the UK. The European Commission has yet to announce a proposal on how it plans to proceed after the EU’s current steel import safeguards expire on June 30.
After TRID’s May 19 announcement, steel producers’ group UK Steel protested that the proposed measures did not go far enough to protect the UK steel industry, and that all steel import controls should be extended for a further three years, because if they weren’t “the UK will become a magnet for huge volumes of steel imports.”
ISTA dismissed UK Steel’s notion as “a fantasy completely out of step with the reality of what has been going on globally for the past six months,” with product access by steel consumers restricted by soaring prices in a protected market.
— Diana Kinch
