The EU has informed the World Trade Organisation (WTO) of its decision to extend steel safeguards until 2024, now with a global quota for some products affected by Ukraine, and with Vietnam added to the "other countries" quota for hot-dip galvanised (HDG).
The measures announced as a result of the European Commission's 2021 review of the safeguard measures will be applicable from 1 July 2022, subject to the next review investigation.
The EU has passed a regulation to temporarily suspend the safeguard measures applicable to Ukraine, which is yet to come into force. Ukraine has historically been an important exporter of product categories 7 and 17, quarto plates and angles, shapes and sections, typically representing around 33pc of total quota volumes — last year it represented almost 43pc of the EU import market. With almost no imports of these categories since the Ukrainian conflict began, the commission intends to globalise the quotas for these categories to alleviate the risk of supply shortages.
The same method will apply to categories 8 and 25A, stainless hot rolled sheets and strips and large welded tubes.
Vietnam has now been included in the list of developing countries to which the safeguard measure are applicable in both 4A and 4B HDG categories. This means Vietnam will now fall under the other countries quota for these categories. Vietnamese shipments of HDG have increased significantly since 2017, reaching 979,205t in 2021, causing local mills to lobby for a change to Vietnam's exclusion. From 1 July 2021 to 30 June 2022 the total 4A and 4B other countries quota is just over 2.1mn t, meaning Vietnam could reasonably be expected to utilise roughly 45pc of the other countries quotas.
The annual rate of liberalisation of the safeguard will increase to 4pc from 3pc as of 1 July 2022 until 30 June 2024 according to the announcement, to progressively allow more import competition into the market while the domestic industry adjusts.
The announcement also noted that the partial replacement of US Section 232 measures did not justify any adjustments to the EU safeguard measures.
