The UK government has accepted the Trade Remedies Authority (TRA)’s recommendation to split the Category 1 – hot rolled coil – tariff-rate quota into one commercial and one downstream processing sub-category, and increase the quota tonnage, Kallanish notes.

The TRA’s proposal issued in August was in response to Tata Steel’s plan to close ironmaking at Port Talbot. It suggested creating Category 1A to be used for commercial application imports, at the current Category 1 tonnage, and Category 1B, used solely for downstream processing and set 132% higher than 1A.

This will mean the overall HRC TRQ will amount to some 3.3 million tonnes/year – 1m t/y for 1A and 2.3m t/y for 1B.

The Category 1B quota will also be allocated on a global basis to allow companies to establish reliable supply chains for domestic processing, along with a cap of 40% to ensure no single country’s exports dominate this new quota.

In light of this decision, the government has asked TRA to reassess its recommendation, also published this week, that the Category 1 TRQ be suspended for nine months. This follows a review initiated in February to address the exhaustion of the residual quota and change in demand for imports as a result of Port Talbot’s blast furnace closure plan.

The initial plan was for the suspension review to be completed sooner and for the suspension measure to cover the period until the TRQ review was completed.

The government now wants TRA to reassess whether or not the temporary change in market conditions which justified the suspension recommendation remains. If the TRA finds that those market conditions do remain, then the authority is also requested to reassess whether, in light of those changes, serious injury to UK producers is likely to recur if the measure were to be suspended. The reassessment should conclude in December.