26/06/25
UK raises HRC quota, EU-to-UK HDG quota cut
UK raises HRC quota, EU-to-UK HDG quota cut
London, 25 June (Argus) — The UK government on Thursday published the
long-awaited update to its steel safeguard quotas, setting the overall quota
volume at 3.218mn t — 21pc higher than provisional volumes published in March.
The cut compared with the previous safeguard regime has been softened to 51pc,
from 60pc in an earlier proposal. The biggest changes are to flat products,
while some quotas, such as for rebar, are unchanged from their provisional
volumes. The overall quota for hot-rolled coil (HRC) has been lifted sharply,
while the quota for importing hot-dipped galvanised (HDG) from the EU has been
reduced significantly. In contrast, quotas for South Korean and Vietnamese HDG
are unchanged. "We recognise that this will create changes to trade flows
including with some of our closest trading partners... Where quotas are filled,
imports above these levels will face a 50pc tariff. The measure will apply only
to products that can be made in the UK," trade minister Chris Bryant said. The
EU HRC quota (category 1) has been revised up to 375,000 t/yr from the
provisional 68,226 t/yr for the quota year beginning on 1 July. The Indian quota
has been raised to 33,456 t/yr from 12,405 t/yr, while the South Korean quota
has increased to 8,785 t/yr from 3,258 t/yr. The UK government has worked
closely with the EU to reflect the two sides' integrated supply chains, Bryant
said. "We have... agreed an approach that reflects the UK and EU's highly
interconnected supply chains. This will provide stability for UK-EU steel trade
from 1 July, while we continue to work together to strengthen UK-EU steel trade
longer term," he said. Market participants questioned whether the South Korean
HRC allocation would be commercially viable, given it allows shipments of only
around 2,196 t/quarter. Compared with the expiring safeguard year, a key change
on HRC is that Turkey and Taiwan have lost their country-specific quotas, with
those volumes folded into the residual allocation. But the residual HRC quota
has been raised sharply to 49,763 t/yr from the provisional 18,452 t/yr. But the
overall HRC quota remains much tighter than under the current safeguard year,
which market participants expect could support UK HRC prices. Prices for UK HRC
were assessed last week at £715/t ddp Midlands. In HDG (category 4), the EU
quota was reduced from the provisional 634,773 t/yr to 510,273 t/yr. But annual
quotas for India, South Korea and Vietnam were left unchanged at 125,796t,
100,753t and 174,367t, respectively. Some market participants said the scale of
Vietnamese HDG volumes allowed into the UK could weigh on prices. Indian-owned
Tata Steel UK said the final quota levels do not reflect UK market conditions
and still leave key segments — including metallic coated steel, packaging steel
and hollow sections — exposed to import pressure. The company warned that this
could undermine the competitiveness, sustainability, growth and investment
outlook of the UK steel sector, and called on the government to revisit the
framework while continuing to work with domestic producers. The government has
also removed some product codes "where new information confirmed there was no UK
production" and added others "where there is evidence of production", Bryant
said. In category 12A (alloy merchant bars and light sections), code 72283070
has been added. In category 12B (non-alloy merchant bars and light sections),
code 72149950 has been added. In category 14 (stainless bars and light
sections), codes 72221910 and 72221990 have been removed. In category 26 (other
welded tubes), codes 73061100 and 73062100 have been removed. In category 28
(non-alloy wire), codes 72173049 and 72173090 have been added, while codes
72172010, 72172030, 72172050, 72172090, 72179020, 72179050 and 72179090 have
been removed. Beyond HRC and HDG, the biggest revisions to the UK's provisional
annual quotas are as follows: category 6 (tin mill products): +58,000t to
69,795t (+491.7pc) category 12B (non-alloy merchant bars and light sections):
+64,102t to 70,812t (+955.3pc) category 17 (angles, shapes and sections of iron
or non-alloy steel): +147,572t to 270,762t (+119.8pc) category 28 (non-alloy
wire): -20,491t to 59,734t (-25.5pc) By Andrey Telegin Send comments and request
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