European Union steel import quotas for Chinese hot-dip galvanized coil, as well as quotas in other country categories for wire rod and hot-rolled coil, have quickly filled since the new quota period began on 1 January.
According to European Commission data last updated on January 4, imports of hot-dip galvanized steel coils from China in category 4B exceeded the balance of 126,603 tonnes by 52%, with a staggering 1.9 million tonnes awaiting distribution.
A duty of 25% will be applied on imported material once the quota is filled. Category 4B is for materials used in the automotive industry. India's Category A (industrial use) quota remains 78% open, but 11,688 tonnes are awaiting allocation, adding to the remaining balance of 34,909 tonnes. Platts, part of S&P Global Commodity Insights, pegged its weekly Nordic HDG estimate at €790/t EXW Ruhr on January 3, up €5 month-on-month. Quotas for other countries, Korean or Indian material for both HDG categories have residuals of 83-100%.
The 'other country' quota of 923,594 tonnes of European HRC imports was also quickly filled with an excess of 18.37% already recorded and 1.09 million tonnes awaiting allocation. 4 January
In the country quota for Korean HRC, 67.27% of the balance of 184,008 tons remains and 60,280 tons are awaiting distribution. HRC quota levels in Turkey and Serbia remain above 90%.
“We also suspect that the quota for the second quarter may also be exhausted,” the German distributor said.
Market participants reported a lack of interest in imported hot-rolled steel among European buyers, with most of them concerned that quotas have already been exhausted.
“Materials are now being left at ports, but high interest rates and high storage costs are also a concern,” said another German distributor.
The Italian trader also said holding materials for customs clearance in the second quarter could be risky, making imports less attractive to buyers now.
Platts priced HRC Northern Europe at €690/t EXW Ruhr on 3 January, stable compared to the previous month, while the import estimate was €650/t CIF Antwerp on 3 January, meaning the difference between domestic and import prices is only 40 euros/t. which further leads to muted consumer interest.
