The UK's Trade Remedies Authority (TRA) has proposed an increase in the import quota for HR flat steel due to a reduction in domestic production, the authority announced on Friday, 9 August, Kallanish notes.

This proposal was triggered particularly by the recent closure of a blast furnace at Tata Steel UK's Port Talbot site as part of a transition to an electric arc furnace, according to the notice.

The TRA proposal includes increasing the quota on imports under category 1 steel — non-alloy and other alloy hot rolled sheets and strips — to a total of 2.9 million tonnes. 

Changes in circumstance, including the closure of the blast furnace, have impacted the UK’s domestic flat steel production, leading to an increase in imports that have consistently exhausted part of the quota for hot rolled flat steel products across four consecutive quarters, according to notice. This, in turn, has driven up the cost of these products for the UK market.

As a result of the reduction in domestic production of category 1 steel, the TRA has proposed varying the measure by duplicating Category 1 to form Categories 1A and 1B. The quota for Category 1A, which would be for those importing for commercial applications, will be retained at current levels. Meanwhile, the quota for Category 1B, accessible solely for downstream processing, will be set 89% higher than that of 1A. Together, categories 1A and 1B will bring the total category 1 quota to approximately 2.9 million tonnes per year. The TRA has also proposed that the Category 1B quota be allocated on a global basis to allow companies to establish reliable supply chains for domestic processing, with a cap in the range of 37-42% to ensure no single country’s exports dominate this new quota.

“Our proposal today is designed to address the reduction in production of hot rolled flat steel at Port Talbot. These changes have resulted in higher imports and parts of the current quota being exhausted, creating uncertainty and driving up costs for steel users. We propose maintaining the current quota volumes for steel used for commercial applications and creating a new quota accessible for downstream processing,” TRA chief executive Oliver Griffiths said.

The import allowance under category 1A equates to just over 1 million tonnes annually, and under category 1B, to around 1.9 million tonnes annually. If these limits are breached, importers would need to pay the 25% tariff, the TRA explained. 

The goods subject to review are currently classifiable within the following commodity codes: 72081000, 72082500, 72082600, 72082700, 72083600, 72083700, 72083800, 72083900, 72084000, 72085210, 72085299, 72085310, 72085390, 72085400, 72111300, 72111400, 72111900, 72126000, 72251910, 72253010, 72253030, 72253090, 72254015, 72254090, 72261910, 72269120, 72269191, and 72269199.