TRA publishes final recommendation on steel safeguard measures

TRA publishes final recommendation on steel safeguard measures

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.