The European Commission will use relatively recent market shares of main exporters when drawing up country-by-country volumes for hot-rolled coil (HRC).
The commission is currently reviewing its definitive steel safeguards. The HRC quota will be amended from a global to country-by-country basis, given the steep rise in imports from certain regions.
The exact period to be used by the commission to determine HRC market shares is unclear. The investigation period was 2015-17 for the country-by-country quotas in place on all other products. But HRC volumes from some countries have risen dramatically since then, and using the same period could restrict availability at a time of mill consolidation.
The EU 28 imported 3.544mn t from Turkey over 2015-17, which works out to 1.181mn t/yr. But average imports rise steeply to 1.927mn t/yr if the period is shifted forward to 2016-18. And Turkish imports in the first five months of this year have risen by 42pc from the year-earlier period to 1.647mn t, putting them at an annualised rate of 3.95mn t/yr.
The commission's move is a compromise between consumers, importers and mills, as Turkey will be able to roughly maintain volumes but not grow them any further. Turkish volumes rose precipitously in the first quarter of this year, as competitive material booked over the fourth quarter – after it was hit with a 50pc import duty into the US in August - started to arrive.
But Turkey's net HRC trade surplus with the EU 28 was just 64,990t in May, its lowest level since February 2018. Turkish volumes into the EU are likely to fall further going forward, while EU mills have been aggressively selling into Turkey, as well as other regions, given the domestic market malaise.
