Some key import quotas within the EU’s new permanent safeguard system appear to be exausted until the end of June, Kallanish learns from the latest data from European customs analysed by Siderweb. The permanent safeguards were introduced officially at the beginning of February.
The safeguard system sets tariff-free import quotas for the period February-June 2019, calculated for the biggest suppliers using a country-based mechanism.
Following a period of uncertainty, customs are set to start the clearance of volumes of products currently at European ports during next week. According to European customs data, for some key products such as Turkish rebar and wire rod, most or all of the quotas allocated for the February-June period are already sitting at the docks awaiting clearance. This has also been highlighted by the Turkish Steel Federation (see separate article).
According to Siderweb calculations, Turkish wire rod volumes at the docks currently represent 103% of the allocated tariff-free quotas for the February-June period. The equivalent of 94% of Turkish rebar quotas for the same period also appear to be awaiting clearance.
The tensions surrounding Turkish rebar and wire rod were anticipated by the fact that preliminary quotas in place until the end of January 2019 were exhausted well before 2018 ended. This confirmed that demand for imports of these products remains above the quotas allocated by the European Commission system.
One trader confirms the issue and notes that some customs bodies in Europe are already requesting a deposit for the 25% tariff for wire rod imports prior to clearing the volumes. This is as per the requirements of the safeguard measures.
Most of the other country-based quotas allocated for different products are not experiencing the same pressure. Chinese automotive grade HDG importers, for example, have used only 35% of the quotas up to now.
