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UK Trade Authority Probes Steel Import Quotas

Via Metal Miner

The United Kingdom's Trade Remedies Authority (TRA) recently initiated a suspension review on safeguard measures against hot rolled flat and coil steels. Steel news sources report that the move also came alongside a tariff quota review.

TRA reported on February 9 that both Tata Steel UK (TSUK) and steel trader Kromat Trading filed applications for the suspensions. "Both reviews respond to TSUK's recent proposal to close its two blast furnaces in Port Talbot, Wales, as part of a transition to an electric arc furnace," the government body stated to steel news outlets.

TRA stated that the UK would require higher export levels of hot rolled flat and coil steel while work to replace the Port Talbot's blast furnaces was underway. Moreover, it noted that the current levels of duty-free imports would be insufficient.

Import tariffs currently sit at 25%. Meanwhile, the UK Department for Business & Trade reported on June 30 that quotas on flat rolled steel imports now total 361,671 metric tonnes, separately for calendar Q1 and Q2. The production plan under review is the same one Tata submitted to unions for formal consultation on January 19.

"Given the importance to the UK economy of managing the projected reduction in domestic production of Hot Rolled Flat and Coil steel, we are carrying out the reviews in parallel with the consultation between TSUK and Trade Unions," TRA said. "Should the consultation result in a different production plan, the TRA would take that into account in making a recommendation to the Secretary of State for Business and Trade."

Port Talbot, China, and Other UK Steel News

Tata announced its plans to permanently blow down Port Talbot's two blast furnaces and replace them with electric arc furnaces on January 20. UK steel news sources were quick to report that the move will ostensibly cut the facility's crude capacity by one-third, from the current listed volume of 4.5 million metric tons to 3 million metric tons per year.

Hot rolled flat steel has applications in the construction sector. It also serves as feedstock for the production of welded pipes as well as for cold rolled coil. North European mills' offer prices for the flat rolled product in January were €800 ($855) per metric ton EXW for February rolling / March delivery. This represents a significant increase from the €720 ($770) they sought in late December.

The UK government set up the TRA in June 2021, after the country exited the European Union, with the goal of policing trade disputes. On February 7, the TRA recommended maintaining an anti-dumping measure on imports of Chinese corrosion-resistant steel (CRS) for a further five years, at least until February 9, 2028. TRA also noted that the applicable to Chinese imports remain at 17.2% to 27.9%. "CRS is worth around £63 million ($79.3 million) to the UK economy annually," the agency added in its note.

By Christopher Rivituso

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