TRA publishes final recommendation on steel safeguard measures
The TRA has published its final recommendation to the Secretary of State for International Trade on the future of the UK’s steel safeguard measure.
The Trade Remedies Authority has today (Friday 11 June) published its final recommendation to the Secretary of State for International Trade on the future of the UK’s steel safeguard measure.
After reviewing available evidence, the independent body has recommended the extension of the UK steel safeguard measure across 10 product categories for a further three years, and the revocation of the measure across nine product categories.
Pursuant to the relevant regulations, the Secretary of State will now decide whether to accept the TRA’s recommendation or to reject it.
The TRA published a statement of intended preliminary decision (SIPD) on 19 May, giving producers, importers, exporters, other interested parties and contributors who provided information during the review process, the opportunity to comment on its initial findings. The recommendation to the Secretary of State takes into account close analysis of the 44 submissions that were made to the TRA following the SIPD.
Data-driven recommendation
The TRA has recommended the extension of the application of the measure on 10 product categories, ranging from railway materials to the stainless-steel bars used in corrosive environments in the marine and aerospace industries. For all these product categories, there was evidence of both an import surge over the period of investigation (2013-17) and injury to UK producers, and extension of the safeguard measure was judged to be in the economic interests of the UK. Categories recommended for extension represented 37% by volume (around 3.9 million tonnes) of average UK steel and iron imports between 2017 and 2019.
The TRA has also recommended that safeguard measures on nine product categories, including tin cans used in packaging, are revoked. For seven categories there was either no absolute increase in imports or no significant increase in imports over the period of investigation. For one category, there was an increase in imports, but there was no evidence that increased imports were damaging UK producers. For the last category (stainless steel rods), the TRA determined that the potential impact of continuation of a measure on downstream users of the products meant that extending or varying the measure was not in the overall economic interest of the UK. Categories recommended for revocation represented 18% by volume (around 1.9 million tonnes) of average UK steel and iron imports between 2017 and 2019.
Responding to additional information
In light of representations made on the SIPD, major changes were made to two product categories. Category 25 (large welded tubes, used among other things for offshore wind-farms and in the energy sector) was originally set to be revoked. Having assessed further comments and evidence on this category, the TRA has recommended it should now be extended. The TRA also received evidence that extending the application of the measure on Category 15 (stainless wire rod, used in a wide range of industries including automotive and oil/gas pipelines) would hinder the growth of downstream industries which use these products and would face increased costs if imports exceeded the allocated quota. The only known UK producer of stainless wire rod is supportive of the measure being revoked for this reason.
Chief Executive of the Trade Remedies Authority Oliver Griffiths explained:
The Trade Remedies Authority has been set up by statute to provide impartial, data-driven economic assessments like this recommendation on steel safeguards. We have listened carefully to all interested parties throughout the review and we have made some important changes to our preliminary decision in light of new information provided over the past few weeks.
Evidence gathering
The TRA’s review process involved gathering and analysing substantial evidence from steel importers, exporters, trade bodies and governments. It received nearly 100 responses to its requests for data during the evidence-gathering process. All the information gathered was checked through a robust authentication process.
Timeframes
The TRA has recommended that the measure should be extended (where applicable) for three years. This timeframe will help provide certainty to UK producers and allow them time to adjust to the competitive international environment. The TRA also recommended the progressive liberalisation of the measure every year over the three years, increasing the levels of each of the allocated Tariff Rate Quotas to ensure that the measure balances the needs of UK steel producers and those who use steel products. At the end of the three-year extension, the TRA would consider whether another extension review is necessary.
The Secretary of State for International Trade will now decide whether to accept the TRA’s recommendation. Without a decision being made to extend measures, the current steel safeguards will expire on 30 June 2021.
View a flowchart detailing the TRA’s decision-making process.
View details of the steel categories that were reviewed and their common uses.
Background information
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The Trade Remedies Authority is the UK body that investigates whether new trade remedy measures are needed to counter unfair import practices and unforeseen surges of imports.
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The TRA is an arm’s length body of the Department of International Trade (DIT) and launched on 1 June 2021. Before its launch, staff operated as the Trade Remedies Investigations Directorate (TRID) of DIT.
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Steel safeguard measures were put in place on 28 categories of steel products by the EU in 2018-19 for an initial period of three years. Safeguards on 19 steel product categories were then transitioned into the UK tariff regime when the UK left the EU Customs Union. The current measure expires on 30 June 2021.
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Safeguard measures are one of the three types of trade remedies – along with antidumping and countervailing measures against dumping and countervailable subsidies respectively – allowed by the World Trade Organisation (WTO). Safeguard measures are emergency actions responding to increased imports of particular products, which cause serious injury to the importing country’s domestic industry. Safeguards apply to all imports (with some exceptions), rather than being focused on imports from particular countries. The use of safeguards, the rules for which are set by the WTO Agreement on Safeguards, is rare. The measures on steel were the first safeguard applied by the EU for over a decade.
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14 anti-dumping and countervailing measures are in place on steel imports into the UK and will continue to provide protection against unfair trade practices.
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The review of steel safeguard measures was initiated by the Trade Remedies Investigations Directorate (the precursor of TRA) on 1 October 2020.
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The TRA is publishing this recommendation in response to a request for the provision of advice, support and assistance from the Secretary of State under section 7(1) of the Trade Act 2021.
Steel categories that were reviewed and their common use
| Product Number | Product category | Extended/revoked | Uses (not exhaustive) |
|---|---|---|---|
| 1 | Non Alloy and Other Alloy Hot Rolled Sheets and Strips | Extended | Yellow goods, construction, Tube making, production of downstream steel products |
| 2 | Non Alloy and Other Alloy Cold Rolled Sheets | Extended | Automotive parts Tube making, cabinets, drums, radiators, construction |
| 4 (two codes removed) | Metallic Coated Sheets | Extended | Automotive, electrical cabinets, purlins |
| 5 | Organic Coated Sheets | Extended | Construction (Building cladding (single skin and sandwich panels)), automotive, engineering and white goods manufacture |
| 6 | Tin Mill products | Revoked – no significant increase in imports/ not causing serious injury | Tin cans, packaging and container industry |
| 7 | Non Alloy and Other Alloy Quarto Plates | Revoked - no significant increase in imports/ not causing serious injury | Ship building, plant machinery, general manufacturing |
| 12 | Non Alloy and Other Alloy Merchant Bars and Light Sections | Revoked – No UK production/ no increased imports | Reinforcing concrete, |
| 13 | Rebars | Extended | Construction, automotive, engineering and white goods manufacture. |
| 14 | Stainless Bars and Light Sections | Revoked - No UK production/ no increased imports | Corrosive environments - aerospace, marine, oil & gas, energy, automotive, medical, pharma, construction and food industries. |
| 15 | Stainless Wire Rod | Revoked – Failed EIT | Architectural design and engineering, food grade production, household items, fixtures and products, medical supplies, chemical/marine vessels, oil/gas pipelines and platforms, water treatment, automotive components |
| 16 | Non Alloy and Other Alloy Wire Rod | Revoked- No UK production/ no increased imports | Reinforcing concrete, |
| 17 | Angles, Shapes and Sections of Iron or Non Alloy Steel | Revoked- No UK production/ no increased imports | Construction |
| 19 (two codes removed) | Railway Material | Extended | Railways |
| 20 | Gas pipes | Extended | Gas pipes |
| 21 | Hollow sections | Extended | Agricultural and construction industry |
| 25A | Large welded tubes | Extended | Infrastructure, Energy sector (pipelines) |
| 25B | Large welded tubes | Extended | Offshore wind farms, |
| 26 | Other Welded Pipes | Extended | Infrastructure, Energy sector (pipelines) |
| 27 | Non Alloy and other alloy cold finished bars | Revoked- No UK production/ no increased imports | Concrete, gates and fences, machining |
| 28 | Non Alloy Wire | Revoked - no significant increase in imports/ not causing serious injury | Barbed wire, saw tooth wire, insulated electric wire. |