Register with us today

and in less than 60 seconds continue your access to:Latest news headlinesAnalytical topics and featuresCommodities videos, podcast & blogsSample market prices & dataSpecial reportsSubscriber notes & daily commodity email alerts

Already have an account?

Log in to register

Forgot Password

Please Note: Platts Market Center subscribers can only reset passwords via the Platts Market Center

Enter your Email ID below and we will send you an email with your password.


  • Email Address* Please enter email address.

If you are a premium subscriber, we are unable to send you your password for security reasons. Please contact the Client Services team.

If you are a Platts Market Center subscriber, to reset your password go to the Platts Market Center to reset your password.

In this list
Metals

Proposed EU steel safeguard quota too tough on importers: market sources

Agriculture | Energy | Coal | Electric Power | LNG | Natural Gas | Oil | Metals | Steel | Petrochemicals | Shipping

Commodities 2020

Marine Fuels

Platts Bunkerwire

Commodities | Metals | Steel | Materials | Building & Construction | Financial Services | Macroeconomics

Steel Markets North America Conference, 16th Annual

Metals | Steel

Thyssenkrupp steel strategy sees heavy plate under review

Proposed EU steel safeguard quota too tough on importers: market sources

London — Quotas on EU imports of steel rebar and rod proposed by the European Commission to avoid dumping were too low if they get confirmed at the levels sent to the World Trade Organization, importers said.

Not registered?

Receive daily email alerts, subscriber notes & personalize your experience.

Register Now

The EC introduced a preliminary quota on rebar last July to avoid material being redirected to the region as a result of the US Section 232 tariff on steel. Any imports beyond the cap attract a 25% tariff.

If the WTO accepts the EC's proposed quotas, they will be official from early February. Market participants have already calculated that as soon as the quotas are put in place, rebar and rod quotas will likely be the first to be filled.

"I heard that as soon as the quotas were announced around Christmas two mills reported [deals...] respectively of 70,000 mt and 60,0000 mt with February arrival from Turkey", a trader said.

According to the document which the EC sent to the WTO, Turkey will be able to export 117,232 mt of rebar into the EU from February 2 to June 30.

When the December deals were done, Turkish rebar was at $455-$460/mt FOB while EU mills were selling the long product around Eur530/mt mt [$610/mt] delivered to mills.

"When there is such a big difference in prices [across regions], there is not too much to comment," a source from a mill said, referring to the size of the quantities purchased.

"Rebar and rod quotas this year are the ones that were fully filled, so there is a need in the market for [a bigger] imports [quota]," an importer said, adding the current quota provisions for those products were insufficient.

That was echoed by other traders who said the quotas were a "present to the European mills" who produce at higher prices than some non-EU producers.

From the perspective of those EU longs producers, the quotas have also created discontent. Some mills pointed out that as soon as a specific country exhausts its quota to export to the EU, it will be able to compete for the residual quota allocated to 'other countries' in the following quarter, with Turkey probably taking advantage of that.

Daily Briefing

Make smarter investment decisions using the latest breaking industry steel news in Platts Daily Briefing. Independent reporting by Platts’ editors and analysts covers all aspects of the steel industry, including in-depth news and analysis by region.

Free Trial

"The problem is that the Turkish economy is very weak now and prices are very competitive, so it is a problem considering how close it is to Europe and how cheap the freight costs are," a source from a large mill said.

"As the proposed safeguards are [designed] now, Turkish exporters will benefit from the residual quotas. They should have designed the residual quotas in a way so that the leftover quota from one quarter will not [be carried over] into the next quarter as this can create also a very speculative approach in the market," the mill source said.

The new quota system differentiates between countries, with some country-specific quotas applied annually, such as for Turkey, Russia and Ukraine, with other countries using a residual global quota applied quarterly.

From February 2, for example, Turkey will is allowed to import 171,231 mt tariff-free until June 30, a level likely to be exhausted quickly following the big volume trades in late December, Turkish and European sources said. The annualized rate amounts to 422,000 mt.

The Turkish wire rod quota stands at 121,331 mt for the same period, annualized to 299,000 mt.

--Pascal Dick, pascal.dick@spglobal.com

--Annalisa Villa, annalisa.villa@spglobal.com

--Edited by Daniel Lalor, newsdesk@spglobal.com