An agreement has been struck between the UK and the European Union regarding the tariff rate quotas (TRQs) on imported steel, days ahead of their implementation, Kallanish observes.
The deal was announced as the Department for Business and Trade published its final figures for the TRQs. This will see an overall quota reduction of 51%, down from the initial 60% proposed, while the out-of-tariff rate will increase to 50%. As part of the changes, 11 commodity codes have been removed while two have been added following industry feedback.
Addressing the House of Commons, Chris Bryant, Minister of State for DBT, said: “Some of the changes reflect the fact that the European Union remains our largest export market for steel, and we have highly interconnected supply chains … We have reached a mutual outcome with the EU as a result of these discussions.”
The UK will thus increase the EU’s quota access from the announced 1.58 million tonnes to 2.08mt. The bloc will announce its own quota numbers next Monday, he added.
“This will provide stability for UK-EU steel trade from 1 July, while we continue to work together to strengthen UK-EU steel trade longer term,” Bryant noted.
“This measure needs to work not just for our steel producers, but also, of course, for our manufacturers, who depend on steel, those who source it from the UK and those who source it from abroad. Our aim is solely to protect categories of steel that we produce in the UK, so we have deliberately excluded many categories from the measure,” he added.
Nearly three quarters of UK steel imports by value and 53% by volume are out of scope of this measure, according to Bryant. “The total quota volume will now be 3.2mt. That is an increase of over 560,000t of steel that can be imported, tariff free, compared to the provisional volumes we announced. A significant 21% uplift,” he said.
“We know that businesses will sometimes need to find specialised steel that we simply can’t procure here in the UK. In these cases, quotas have been designed to allow for imports and to ensure continued availability for UK businesses without additional unnecessary costs; to ensure continuity within supply chains for business, we are also introducing a transitional arrangement.”
Concerns have been raised that some products included in the quotas are those which “could” be made domestically but which are currently not being produced.
In Category 1, the provisional yearly EU quota stood at 68,226t and has now increased to 375,000t. Category 5 now stands at 49,836t for the EU, from 29,836t provisionally, while Category 6 has gone from 4,740t to 39,795t.
The EU quota for Category 12B has been revised to 47,618t from 4,454t, while Category 14 is now at 16,543t from 11,532t. Category 17 has increased to 253,678t from 106,106t, while Category 26 has risen to 30,026t from 19,666t.
Other categories saw no changes or only minor revisions. Category 4 has seen its EU quota reduced from 634,773t provisionally to 510,273t, as has Category 28 from 47,859t to 43,157t.
Author: Carrie Bone
