The UK’s safeguard on hot-rolled coil (HRC) may need to be removed, the UK Trade Remedies Authority (TRA) said today, announcing both suspension and tariff-rate quota reviews on the product.
The TRA has initiated both reviews following applications from Tata Steel UK and Kromat Trading, each in response to Tata’s plan to close its blast furnaces and import HRC and slab, it said today.
“Based on the applications and from other evidence available on the current state of the market, it is the TRA’s preliminary view that the measure should be suspended,” the TRA said. Tata’s plan would mean the current level of duty-free quota for HRC would be insufficient for UK needs, it said, suggesting imports are already facing duties because of the increase on volumes contributed to by Tata’s importation of HRC.
The TRA provisionally believes the safeguard on HRC should be suspended for nine months.
Its review considers the plan Tata submitted to trade unions on 19 January, and if these plans change, it will take this into account during its review. Once the TRA has completed its review, it will make recommendations to the Secretary of State for Business and Trade, who makes the final decision.
If any suspension recommendation is made and accepted by the government, the TRA will use the period to rework the quota system, enabling sufficient volumes for the market going forward. The quota could be global and importers potentially would be apportioned their own volumes, but it is not yet clear how this would be worked out, or if the plan could be amended in the course of the review.
“These reviews are designed to prepare the current steel trade regime for future changes in production at Port Talbot,” TRA chief executive Oliver Griffiths said. “We want to avoid a situation where new imports needed to backfill reduced domestic production pay tariffs of 25pc, loading additional costs on to the UK economy.”