The new iteration of the EU steel safeguard quotas will include a 20pc cap on hot-rolled plate imports under the "other countries" quota, which will limit imports from a number of key sellers.
The proposed quarterly plate quota stands at about 550,000 t/quarter, which is only slightly lower than current levels, by about 15,000t from January-March. Suppliers such as South Korea, Indonesia and India previously were able to tap into the quarterly volume unrestricted, but now will be limited to 110,000 t/quarter for a total of about 440,000 t/yr. There will no longer be a carryover of unused quota volumes from quarter to quarter for several products including heavy plate.
The changes are set to take effect on 1 April unless any objection is lodged by the World Trade Organization.
Plate imports into the EU last year amounted to 2.1mn t. Only South Korea exported beyond the new 440,000t threshold, as arrivals totalled 760,000t, leaving 320,000t, or about 42pc of its volumes to the bloc, at risk if exports were to continue at last year's pace.
Indonesian and Indian exports to the EU were lower at 420,000t and 410,000t, respectively, last year. If imports from these countries continue at the same pace, the impact on these origins will be minimal.
The changes could benefit some suppliers with lower volumes such as Brazil, Japan, North Macedonia and Malaysia, which could potentially step up to substitute some of South Korea's volumes.
"I think [South] Korea is the loser indeed, and total imports are more likely to be reduced. This should give a respite to EU producers but competition will increase within Europe as producers will most likely increase their production if they can. I do not see a healthy market ahead," a trading firm said.
