SteelOrbis has heard that in recent weeks rumors have been circulating in the EU market about the imposition of definitive safeguard measures by the European Commission. According to sources, the definitive decision which was expected in late December is likely to be postponed to by end of February 2019.
Recently, EUROFER has advocated country-specific quotas instead of the global quotas that are in place at the moment as per the provisional safeguard measures that will end on February 3, 2019. “We see the need for national quotas, at least for the big exporting countries” in an attempt to re-balance import flows and quantities closer towards their traditional volumes, said Karl Tachelet, director of international affairs at EUROFER.
Last week, in Paris, ArcelorMittal CFO Aditya Mittal said that the provisional safeguard measures "have a lot of weakness. It is absolutely critical that the provisional safeguard measures are made into final measures and that these weaknesses are rectified". Mittal urged the European Commission to set quotas per quarter, not for the full-year, which could allow a year's worth of imports in just a few months. "That would create tremendous volatility and cause a lot of disruption to our European business", he said.
According to SteelOrbis sources, the European Commission could indeed set quotas per quarter and per country. Moreover, instead of using 2017 data as in the provisional investigation, the Commission may calculate the import shares based on the period from July 1, 2017 to June 30, 2018. This could result in including some countries that were excluded from the provisional measures and that increased their exports to EU in the first six months of 2018.
Additionally, rumors say that the European Commission is considering adding three steel product categories to the scope of the definitive safeguard measures, in the view of a recent significant increase in imports of such products. These product categories, according to sources, could be "railway material", "other seamless pipe", and "cold finished bars".
The European Union imposed provisional safeguard measures in July combining quotas and tariffs to counter steel flooding into the market after the US President Donald Trump slapped 25 percent tariffs on steel imports. The provisional measures will remain in place until February 3, unless they are replaced by definitive measures before this deadline.