Europe Flooded with Steel Imports with 75% Quotas Full

In the wake of the trade war between China and U.S. that led to an influx of cheap steel imports in rest of the world, European Union has made an attempt to limit the imports of steel into the bloc by announcing a quota in the month of January this year which will be valid till July 2021.

The commission plan involves a quota set at the average level of imports over the past three years, plus 5%. A 25% tariff would apply once the quotas are filled. There are also specific limits for major exporting countries. The quotas would apply for three-month periods in order to limit stockpiling and could also be increased by 5% each year.

Now, as per the market sources, around 75% of European tariff-free quotas for the period ending 30 June have now been filled as per the European Commission official data. About 10.2 MnT of quotas were available for the period ending 30 Jun’19 and almost 7.7 MnT of these quotas have been used. Whereas the quotas of key product categories have been exhausted which means that steel imports will be almost negligible in the coming weeks of June. Most of the quotas for the import of metallic coated sheet have been fully taken up. Those for rebar, organic coated sheet, stainless bars and sections, stainless wire rod, non-alloy wire rod, hollow sections, and non-alloy wire have also been fully subscribed. New quotas will be available from the beginning of July 2019.

On the other hand, the European Commission is speeding up its assessment of possible taxes on cheap steel from Asia following an alert from European producers. According to the collected European steelmakers, they have lost USD 40 billion in market value in a year and region’s largest steelmaker, ArcelorMittal has reduced its production twice in Europe.
On behalf of the 28 member states, the European Commission stated that in addition to accelerating its examination of import duties, it was also alert to any signal from European producers to ensure “fair conditions” for the industry and that the study of import duties will be ready by the end of June month.