Potential EU probe into Japanese HRC unsettles market

Some buyers and sellers are growing concerned about offering Japanese and other Asian hot-rolled coil (HRC) to Europe owing to the possibility of a dumping investigation.

Southeast Asian and Indian mills have become the largest suppliers to the EU this year, increasing their share of the bloc's HRC import market to 46pc from 38pc in 2021. Japan, South Korea, Taiwan, Vietnam and India have all ramped up their supply to Europe noticeably. None of these countries face any additional anti-dumping or subsidy duties outside of the EU's safeguard quotas.

A Japanese mill has been less aggressive in the market for the past couple of weeks, initially stepping away as it was concerned about a potential probe, having continuously slashed prices to attract orders since the summer. Japan has doubled its share of EU HRC imports in the first nine months of this year, to 12pc from 6pc in 2021, becoming the second-largest supplier after Turkey. In the flat steel segment, imports from Japan account for a 25pc market share at present, according to European steel association Eurofer.

But many participants doubt that the EU would look to introduce measures on an important trade partner such as Japan.

Eurofer did not comment on talk of a petition being submitted to the European Commission for an investigation or further pressure for import measures. Eurofer has recently been conducting anti-subsidy studies into India, Algeria, Turkey and Vietnam, using professional services firm EY.