Address https://gelex.eu/eli/EU/regulation/2018/1013@2018-07-17/en

Contents

1. Preamble
2. 1. Article 1
   2. Article 2
   3. Article 3
   4. Article 4
   5. Article 5
   6. Article 6
   7. Article 7
   8. Article 8
3. ANNEX
4. ANNEX I Products concerned
5. ANNEX II
6. II.1 — Growth in imports for the 23 product categories (in tonnes)
7. II.2 — Growth in imports for the 23 product categories (in tonnes)
8. II.3 — Growth in imports for the 5 product categories (in tonnes)
9. ANNEX III Economic indicators for the 23 product categories
10. Product 1 Non Alloy and Other Alloy Hot Rolled Sheets and Strips
11. Product 2 Non Alloy and Other Alloy Cold Rolled Sheets
12. Product 3 Electrical Sheets (other than GOES)
13. Product 4 Metallic Coated Sheets
14. Product 5 Organic Coated Sheets
15. Product 6 Tin Mill Products
16. Product 7 Non Alloy and Other Alloy Quarto Plates
17. Product 8 Stainless Hot Rolled Sheets and Strips
18. Product 9 Stainless Cold Rolled Sheets and Strips
19. Product 12 Non Alloy and Other Alloy Merchant Bars and light Sections
20. Product 13 Rebars
21. Product 14 Stainless Bars and light Shapes
22. Product 15 Stainless Wire Rod
23. Product 16 Non Alloy and Other Alloy Wire Rod
24. Product 17 Angles shapes and sections of iron or non alloy steel
25. Product 18 Sheet piling
26. Product 20 Gas pipes
27. Product 21 Hollow sections
28. Product 22 Seamless stainless tubes and pipes
29. Product 23 Bearing tubes and pipes
30. Product 25 Large welded tubes
31. Product 26 Other welded tubes
32. Product 28 Steel Wire
33. ANNEX IV List of products originating in developing countries to which the provisional measures apply
34. ANNEX V Tariff quotas

THE EUROPEAN COMMISSION,

Having regard to the Treaty on the Functioning of the European Union,

Having regard to Regulation (EU) 2015/478 of the European Parliament and of the Council of 11 March 2015, and in particular Articles 5 and 7 thereof,

Having regard to Regulation (EU) 2015/755 of the European Parliament and of the Council of 11 March 2015, and in particular Articles 3 and 4 thereof,

After having consulted the Committee on Safeguards established under Article 3(3) of Regulation (EU) 2015/478 and Article 22(3) of Regulation (EU) 2015/755 respectively,

Whereas: BACKGROUND

(1) On 26 March 2018, the Commission published a Notice of Initiation of a safeguard investigation concerning imports of 26 steel product categories (2018/C 111/10) in the Official Journal of the European Union. The Commission decided to initiate the investigation in the light of sufficient evidence that imports of those products might cause or threaten to cause serious injury to the Union producers concerned.

(2) On 28 June, the Commission also published a Notice by which the investigation was extended to two additional product categories.

(3) The information available to the Commission from the steel prior-surveillance mechanism in place and from Union industry sources showed that an increasing trend of imports of these product categories and the prevailing menacing economic and trade conditions, including the situation of the Union steel industry, justified an in-depth examination.

(4) Furthermore, due to the measures against imports of steel adopted by the United States of America (U.S.) under Section 232 of the Trade Expansion Act of 1962 (Section 232), there was a high risk of further increase of imports resulting from trade diversion.

(5) These circumstances, in a context of persistent worldwide overcapacities, may jeopardise the Union steel industry, which is still vulnerable to a likely imminent increase of imports and recovering from the damage caused by unfair trade practices, as the substantial number of trade defence measures taken worldwide on steel products in the recent past prove.

(6) On 11 April 2018, the Commission issued a Note to the File containing key import statistics and available injury indicators. In relation to this Note to the File, the Commission received 41 submissions from third countries, national associations and individual steel companies

(7) Several interested parties have claimed that the Commission failed to disclose the evidence on which the initiation of the safeguard investigation was based in an adequate and timely manner. It was claimed that by failing to do this, interested parties were not allowed to fully exercise their rights of defence. More precisely, several interested parties claimed that the Note to the File made available on 11 April 2018 did not contain data on Union sales, Union exports, Union consumption, or total Union production.

(8) Contrary to these claims, the Note to the File did contain data on Union sales, Union consumption, and total Union production. Furthermore, the Commission considers that, in addition, the main elements and evidence available were adequately summarised both in the Notice of Initiation that was published in the Official Journal of the European Union and the notification of the investigation to the WTO pursuant to Article 12.1(a) of the WTO Safeguard Agreement.

(9) The Commission therefore considers that it has fulfilled its legal obligations to adequately protect the rights of defence of interested parties. In any event, interested parties still have the opportunity to exercise their rights during the remainder of the investigation.

(10) In order to obtain the information necessary to carry out an in-depth assessment, the Commission sent questionnaires to known EU producers and to any exporting producer, importer, and user of the products under investigation that so requested within the deadlines stipulated in the Notice of Initiation. These parties, like third countries, were also invited to make any relevant submissions. The Commission has received 222 replies to questionnaires and 74 submissions.

PRODUCT CONCERNED AND LIKE OR DIRECTLY COMPETING PRODUCT

(11) The Commission initiated the safeguard investigation on 26 steel product categories imported into the EU, and on 28 June its scope was extended by 2 additional product categories by means of a notice amending the Notice of Initiation. The 28 product categories (the product concerned or the product categories concerned) are all covered by the steel surveillance mechanism introduced by the Commission in May 2016. They are also subject to the US tariff measures under Section 232. The product categories concerned, together with the CN codes under which these products are currently classified, are listed in Annex I.

(12) In this preliminary assessment, the Commission finds that the 28 product categories produced by the Union producers (hereinafter the like product or the like product categories) are like or directly competing with the product categories concerned. Both the Union-produced and the imported products concerned have the same basic physical, technical and chemical characteristics; they have the same uses, and price and quality information on them is readily available; they are also sold via similar or identical sales channels to customer who purchase or may purchase them from both domestic as well as alternatively from foreign exporters. Accordingly, there is strong competition between the product categories concerned and those produced by the Union producers under the corresponding categories.

(13) The Commission has also found in this preliminary analysis that there is an important interrelation and strong competition between products classified in different product categories and also between products at different production stages within certain categories as some of the categories contain the main raw or input material to produce other products in other product categories.

(14) Some examples illustrate this interrelation and competition within and between product categories. For instance, hot rolled wide strips are produced from slabs and rolled into coils or produced flat on quarto mills. By cutting the strip to length, sheets are produced. Narrow strip is produced either directly or by slitting hot-rolled wide strip. Hot rolled flat products are also used in the manufacture of pipes and tubes for the petrochemical industry and cold rolled flat products are subsequently used by welded tube manufacturers. A large part of the hot rolled wide strip that is produced is further processed to produce cold rolled strip, which is thinner and has a superior surface finish. A significant proportion of the cold rolled products are metallically coated, with tin or chrome for the can industry or with zinc.

(15) Many producers in the Union are active in the production of most the above mentioned products. For example, Arcelor Mittal not only produces hot rolled and cold rolled sheets and strips but also coats several steel products and produces plates. Similarly, companies like Voest Alpine and Tata Steel produce hot rolled and cold rolled sheets and strips and also coated steel products made of these products.

(16) Furthermore, as a consequence, given this level of interrelation, competitive pressure can easily be shifted from one product to the other. For instance, if trade defence measures are imposed on one product, e.g. steel coils, that product may be further transformed in the same country and exported under a different form to avoid the additional measures and still compete with domestic products. It is also not excluded that third countries import some of these products at low cost and transform them before re-exporting them to the Union.

(17) Because of these interrelations and interconnections, and given the fact that – as will be explained below – the potential trade diversion resulting from the U.S. Section 232 measures applies to all product categories on account that these measures are applied horizontally to all steel products, without distinction of their shape, size of composition, the analysis for the purpose of the provisional determination has been carried out both globally for all 28 product categories, as the product concerned (i.e. steel in various shapes and forms) and also at individual level for each product category.

THE UNION PRODUCERS

(18) Most of the Union's producers are members of the European Confederation of the Iron and Steel Industry (Eurofer) or, to the extent the products are pipes and tubes, members of European Steel Tube Association (ESTA). These two industry associations represent more than 95 % of Union steel production. Their members are located in almost all Member States.

(19) On behalf of their members, these industry associations have informed the Commission that they support the opening of the safeguard investigation, as well as the adoption of measures to also address the trade diversion resulting from the Section 232 measures that seriously disrupts the steel market which has not yet fully recovered from the steel crisis.

INCREASE IN IMPORTS

(20) Based on the information from Eurostat, the prior steel surveillance mechanism, as well as information submitted by the Union industry, the Commission has carried out a preliminary analysis of the increase in imports of the products concerned over the period 2013-2017. The Commission has also examined the evolution of imports during the first quarter of 2018 in order to confirm the recent increase in imports.

(21) The total imports of the products concerned have developed as follows: Source: Eurostat 2013 2014 2015 2016 2017 imports (000 tonnes) 18861 22437 27164 29778 30573 index 2013 = 100 100 119 144 158 162 market shares 12,7 % 14,4 % 16,9 % 17,9 % 18,0 %

(22) In overall terms, imports of the 28 product categories concerned, taken altogether, increased in absolute terms by 62 % over the period 2013-2017. The increase of imports was especially marked until 2016. Subsequently, imports continued to increase and remained at a very high level.

(23) Imports for the vast majority of the individual product categories covered by the investigation also showed an increase in absolute terms over the last five years. For example, the imports of the largest categories in terms of imports (product categories 1, 4, and 7) have increased by 45 %, 168 %, and 78 % respectively.

(24) There was however not an increase for 5 product categories, namely products 10, 11, 19, 24, and 27. The Commission therefore considers that these product categories should at this stage be excluded from the scope of the provisional measures. The Commission, nevertheless, reserves the right to include these 5 product categories in the scope of the definitive measures and to this effect will continue monitoring the imports within these categories. The evolution of imports for each product category is presented in Annex II.

(25) In addition to the exclusion, at this stage, of the abovementioned product categories, the Commission has also considered the exclusion of certain countries from the scope of the measures in line with the conclusions in recital (121). Accordingly, the Commission has excluded the imports of these product categories from these aforementioned countries from the rest of its preliminary analysis and reviewed the imports' evolution.

(26) On this basis, the imports of the products concerned by this preliminary determination have developed as follows: Source: Eurostat 2013 2014 2015 2016 2017 imports (000 tonnes) 17367 20764 25556 28174 29122 index 2013 = 100 100 120 147 162 168 market shares 12,1 % 13,8 % 16,5 % 17,5 % 17,8 %

(27) Imports increased in absolute terms by 68 % during the period 2013-2017, with market shares increasing from 12,1 % to 17,80 %. The most significant increase took place in the period 2013-2016, but imports continued to increase and remained at a high level in 2017.

(28) The trend of increasing imports continues in 2018. When comparing the first quarter of 2018 with the first quarter of 2017, the overall import increase amounts to 10 %. For 9 product categories, the increase is more than 20 % and for one of those categories (category 13) the increase is more than 100 %. Moreover, this increase took place even before the Section 232 measures entered into force.

(29) The Commission therefore concludes that there has been a sudden, steep, and significant increase of imports in absolute terms for 23 product categories. In addition, the increase of imports continues in the first quarter of 2018 and it is expected to be even more significant in view of the expected trade diversion from the Section 232 measures.

UNFORESEEN DEVELOPMENTS

(30) The Commission has preliminarily determined that the above-mentioned increase in imports of steel products in the Union has been the result of unforeseen developments that finds its source in a number of factors establishing and aggravating imbalances in the international trade of the products concerned.

(31) First of all, the nominal global steelmaking capacity has more than doubled since 2000, from a level of 1,05 billion tonnes in 2000 to 2,29 billion tonnes in 2016 and has remained at a very high level in 2017 (2,27 billion tonnes). In addition, actual global steel production in 2016 (1,6 billion tonnes) was still 100 million tonnes higher than global steel demand (1,5 billion tonnes). Consequently, there has been over the last years a major gap between nominal global capacity and production and between production and demand, generating an unprecedented overcapacity in the global steel market which has persisted despite the measures adopted to narrow it. Moreover, looking forward, whereas global production in 2017 increased by more than 5 % due to an economic recovery, global steel demand in 2018 will show only moderate growth with further deceleration predicted for 2019. There was a sign of recovery in 2017, but important risks remain.

(32) The steel firms continue to be financially vulnerable since, as mentioned above, there are persisting structural imbalances in the steel sector. These imbalances are accentuated by distortive subsidies and government support measures. Given the important fixed costs in the steel sector, many steel producers, notably in countries where the State distorts the normal play of market forces, kept capacity utilisation at high rates and flooded third country markets with their products at low prices when they could not be absorbed by domestic consumption. This has resulted in increasing imports in the EU and overall price depression. Import prices have in general undercut Union industry prices in 2017, based on an average price comparison for each product category. Such an average price comparison does not necessarily reflect all the specificities which may have an impact on comparability, but nevertheless gives a good indication of the general price level of imports as compared to Union prices. Undercutting was established for 17 product categories, with ranges between 1,2 % and 23 %.

(33) Secondly, the above effect has been exacerbated by trade-restrictive practices in third country markets. Indeed, since 2014/2015, in reaction to the above mentioned oversupply of steel and the market-distorting practices, several countries have begun to make greater use of trade policy and trade defence instruments in the steel sector with a view to protecting their domestic producers. Mexico, South Africa, India and Turkey have applied import tariffs' increases ranging from 2,5 % to 40 % for a series of steel products including inter alia: hot rolled and cold rolled steel, flat steel products like strips, and also rebars. These products were typically imported in increasing quantities over the period of investigation. Furthermore, third countries continued throughout 2017 to impose trade restrictive measures: some countries introduced minimum import prices (India), some imposed mandatory national standards for steel (Indonesia) and others imposed local content requirements, including through government procurement (U.S.).

(34) In addition, recourse to trade defence instruments has steadily increased. Based on WTO statistics, whereas during 2011-2013 on average around 77 steel-related investigations had been initiated per year, during 2015-2016 this average increased to 117. In February 2018, the U.S. had 169 anti-dumping and countervailing duty orders in place on steel, as well as 25 ongoing investigations that could lead to an even more restrictive picture for imports of steel into the U.S. As the U.S. is one of the world's largest steel importing countries – representing around 13,1 % of the world steel imports (in 2016) – the impact of such a large number of trade remedies has been strongly felt globally.

(35) Third, in the context of the prevailing persistent worldwide overcapacity, the illegal and restrictive U.S. Section 232 measures, given their level and scope, are likely to cause substantial trade diversion of steel products into the Union. The U.S. have calculated that the imposition of a single across-product tariff under the Section 232 measures with almost no country exclusion should decrease imports by approximately 13 million tonnes – corresponding to 7 % of Union consumption. The Union market is generally a very attractive market for steel products both in terms of demand and prices. Some of the main exporters to the US are also traditional steel suppliers to the Union and there is no doubt that these countries, as well as others whose exports and production will be affected by the U.S. measures and the foreseeable trade diversion cascade, will redirect their exports to the Union. Even a partial diversion of the abovementioned trade flows into the Union will unavoidably result in a new price depression and undercutting on the EU market, bringing price down to levels comparable to those of 2016, with significant negative consequences on the profitability of the Union steel industry. It should finally be noted that the additional import increase which is liable to further deteriorate the economic situation of the Union steel industry might especially originate from countries currently not subject to anti-dumping/countervailing duty measures.

(36) Consequently, the abovementioned unforeseen developments have lead and will further lead to a clear increase of steel imports into the Union.

THREAT OF SERIOUS INJURY Global situation of the Union steel industry

(37) In order to formulate its preliminary determination as to whether there is evidence of serious injury or threat of serious injury to the Union industry for the product concerned under assessment, the Commission, in line with Article 9 of Regulation 2015/478 and Article 6 of Regulation 2015/755, has examined the trends of consumption, production, capacity utilisation, sales, market share, prices, profitability, stocks, Return On Capital Employed (ROCE), cash flow and employment for the product concerned for the years 2013 to 2017 (pending the collection of 2018 data).

(38) This analysis has been carried out globally and also individually for the 23 product categories showing an increase of import volumes (the products/product categories under assessment). As explained in Section II above, the Commission considers such a global and comprehensive analysis adequate in this investigation, given the interrelation, interconnection, and the level of competition between the different products from a demand and supply point of view.

(39) When looking at the overall situation, the Union consumption, sales of Union producers and the corresponding market share developed as follows: Source: Eurostat and industry data (000 tonnes) 2013 2014 2015 2016 2017 Consumption 144908 152146 157236 163100 166244 index 2013 = 100 100 105 109 113 115 Domestic sales 125808 129261 129542 132717 134542 index 2013 = 100 100 103 103 105 107 market shares (%) 86,8 % 85,0 % 82,4 % 81,4 % 80,9 %

(40) The consumption of the products under assessment increased consistently every year during the period 2013-2017, and by 15 % overall. The sales of Union producers also increased, but to a much lesser extent than Union consumption, i.e. by 7 % only. Consequently, the Union producers could not benefit from the increasing Union demand and lost market shares, going from 86,8 % to 80,9 %. It should be recalled that during the same period imports increased by 68 %.

(41) On the basis of the questionnaire replies received from the Union producers, production and production capacity developed as follows: Source: Industry data 000 tonnes 2013 2014 2015 2016 2017 EU production 184912 190687 192493 194369 200650 index 2013 = 100 100 103 104 105 109 production capacity 257331 257138 258056 260171 265353 index 2013 = 100 100 100 100 101 103 capacity utilisation (%) 71,9 % 74,2 % 74,6 % 74,7 % 75,6 %

(42) Production capacity increased by 3 % during the period 2013-2017, but less than the production level which increased by 9 %. As a result, the capacity utilisation rate increased from 72 % to 76 %.

(43) The stocks held by the cooperating companies increased overall by 20 % in the period 2013-2017. Source: questionnaire replies 000 tonnes 2013 2014 2015 2016 2017 Stocks 11006 11896 12391 12117 13222 index 2013 = 100 100 108 113 110 120

(44) Unit sales prices, profitability and cash flow of the Union producers developed as follows: Source: questionnaire replies 2013 2014 2015 2016 2017 Unit sales prices (EUR/tonne) 673,5 652,8 616,9 572,9 681,5 index 2013 = 100 100 97 92 85 101 Profitability – 1,0 % 0,9 % 0,9 % 2,2 % 6,2 % Cash flow (mio EUR ) 3133 4975 6519 5386 6141 index 2013 = 100 100 159 208 172 196

(45) In the period 2013-2016 there was a significant price depression on the Union market: Unit sales prices decreased by 15 %. It should be recalled that imports also increased significantly during this period. The average unit sales price recovered however in 2017 and reached a level comparable to 2013. Profitability overall remained at a very low level during the period 2013-2016. Despite a significant decrease in prices, the Union industry could nevertheless reduce its cost of production in 2016 to such an extent that it managed to make a small level of profit of 2,2 %. The situation temporarily recovered in 2017. Sales prices increased by almost 20 % between 2016 and 2017 and reached their 2013 level. The Union industry achieved a level of profit of 6,2 % since cost of production (raw material), even if increasing, remained lower than in 2013. The overall cash flow position of the Union industry increased by approximately 60 %.

(46) In terms of employment, over the 5-year period, the Union producers of the product categories under assessment lost almost 10000 jobs. Source: questionnaire replies 2013 2014 2015 2016 2017 employment (FTE) 189265 183470 182136 182162 181303 index 2013 = 100 100 97 96 96 96

Situation at the level of individual product categories

(47) In addition to the global analysis of the situation for the product concerned overall, which the Commission considers to be the appropriate standpoint for the appraisal of the necessity of safeguard measures in this investigation, the Commission has also assessed the situation at the level of the individual product categories in order to confirm the above trends at a disaggregated level.

(48) When looking at individual product categories, the situation is more contrasted but generally shows the same trends. The economic indicators are provided individually and by product categories in Annex III.

(49) The Union consumption for all but two product categories increased in the last five years. While this increase remained modest for some individual products, with a minimum increase of 2 %, it was much more marked for others, with a maximum increase of 169 %.

(50) Sales volumes were generally stable in the period 2013-2017 or, in some cases, slightly increased but, except for three product categories, they did not increase as much as EU consumption. As a result, there was a decrease of market shares over the five year period for all but 3 products.

(51) Production levels generally increased for 18 out of 23 of the individual products, as well as capacity utilisation rates.

(52) In terms of prices, there was a significant price decrease for each product (except for one product that was subject to anti-dumping duties in the form of a minimum import price) in the period 2013-2016. Prices recovered in 2017, given a general recovery of the steel market but also as a consequence of the various trade defence measures taken against unfair pricing behaviour and subsidised imports. For 16 products the price level remained lower in 2017 than in 2013. It should be noted that average import price levels were almost systematically lower than Union prices for all years, and for all product categories.

(53) As far as profit is concerned, all product categories were sold at a loss or at a much reduced profit until 2016. Only 7 products could recover to a level of profit above 6 % in 2017. These products are significant in terms of EU production volume and six of them are currently subject to (recent) anti-dumping or countervailing duty measures. Note that these measures concern only some countries of origin. All other products remained either loss making (3 products) or only close to break-even (13 products). It is considered that the level profit below 6 % is insufficient to cover the investments needed to sustain the activity, as, in the majority of the recent investigations, the Commission has used a level of around 8 % profit as a sufficient profit level in this sector in order to cover investments. As for cash flow, for half of the products the cash flow deteriorated in 2013-2017 and for 6 products the cash flow was even negative in 2017. The return on capital employed (ROCE) remained low in the period 2013-2016, but subsequently improved for a large majority of the product categories, even though for 5 products the ROCE was still negative in 2017.

(54) In terms of stocks, the stocks increased for 17 product categories. Only the stocks of 5 product categories decreased and for one product category it remained at the same level during the period.

(55) The above analysis corroborates that the situation of the Union steel industry deteriorated significantly in the period 2013-2016. This materialised by a decrease in market shares, and by a significant price depression which prevented the industry from benefiting from lower raw material costs. These trends existed both at a global and individual product level. The situation partially recovered in 2017. While many product categories are still below a level of sustainable profit, some have improved, most likely as a result of the recent imposition of anti-dumping and anti-subsidy measures. Globally, and for individual product categories, it is therefore considered that the Union industry is still in a fragile situation and vulnerable to further increase in imports, in particular if imports from countries subject to trade defence measures are replaced by other imports diverted from the U.S. market as a result of the Section 232 action.

(56) This is, for example, typically the case for product categories 1, 2 and 4, which are important in terms of Union demand but also because these product categories (in particular categories 1 and 2) are used as raw material to produce other steel products. For product categories 1, 2 and 4, the financial situation was negative in 2016, but became positive in 2017 following the imposition of anti-dumping and anti-subsidy measures against a number of countries like, amongst others, China and Russia. Imports from these countries have however been recently and partially replaced by imports from India, Korea and Turkey, the two latter being also significant supplier to the U.S. In the first quarter of 2018, i.e. before the imposition of the measures in the U.S., Union imports have already increased for product category 1 as compared to the first quarter 2017, and this increase is mainly due to imports from Turkey.

(57) It is likely that a further increase in steel imports in the Union would prevent the Union industry, which has not yet fully recovered, to benefit from the positive effect of the recent trade defence measures.

Threat of serious injury

(58) In its Steel Communication of March 2016, the Commission concluded that the Union steel industry was facing a number of serious challenges, fuelled by global overcapacity, a dramatic increase of global exports, and an unprecedented wave of unfair trading practices.

(59) In parallel, in order to remedy the injury caused by unfair trade imports, the Union has imposed a number of anti-dumping and anti-subsidy measures against imports of steel products. In total, there are currently no less than 19 anti-dumping or anti-subsidy measures against the unfairly traded imports of 14 product categories under investigation from various countries. During the period under investigation, i.e. 2013-2017, 13 new investigations determined that the EU steel industry suffered (or in one case was threatened to suffer) from material injury caused by unfair trade practices.

(60) As noted in recital (55), the Union industry is still in a fragile situation and vulnerable to a further increase in imports. The recent U.S. decision not to exclude EU exports from the scope of Section 232 measures will likely reduce the Union producers' ability to export their products to the U.S. and make their situation even more vulnerable.

(61) Steel imports have increased significantly, remaining at high levels in 2017. The further increase of imports in 2018 – in particular from those countries or exporters not subject to trade defence measures – is likely to prevent the industry from a full recovery and from benefiting from these measures. The Union steel industry is indeed considered to be still vulnerable to further increases of imports.

(62) In the absence of provisional safeguard measures, it is likely that the situation will develop into actual serious injury in the foreseeable future.

(63) In this context, pursuant to Article 9(2) of Regulation 2015/478 and Article 6(3) of Regulation 2015/755, the Commission has examined the rate of increase of the exports to the Union and the likelihood that available capacity is used to export into the Union.

(64) First, as concluded above, imports into the Union increased substantially in the period 2013-2017, i.e. by 68 % globally. While the increase was especially marked until 2016, imports continued to increase in the subsequent period, albeit at a slower pace. As highlighted in recitals (37) and (82) regarding critical circumstances – imports increased again significantly, by almost 10 %, in the first quarter of 2018. The rate of increase of imports is therefore significant.

(65) Second, in a situation of global overcapacity in various countries, it is expected that the restrictive U.S. Section 232 measures, given their level and scope, are likely to cause trade diversion of steel products in the Union.

(66) The U.S. have announced their intention to decrease imports by approximately 13 million tonnes and, as a result, have imposed in March 2018 an additional import duty of 25 % against imports of a very large number of steel products. The volume of steel that will no longer be exported to the U.S. will unavoidably be diverted to other third countries.

(67) Some of the main exporters to the US are also traditional steel suppliers to the Union. It is more than likely that these countries, as well as others, will to a large extent be willing to redirect their exports to the Union. The Union market is indeed generally an attractive market for steel products both in terms of demand and prices. In fact, the EU is, after China, but before the U.S., one of the main markets for steel, where demand has increased in the last years and prices have also now recovered.

(68) In this context, a significant increase of supply on the Union market caused by an influx of imports will result in a general downward price pressure, resulting in price levels comparable to 2016 with significant negative consequences on the profitability of the Union steel industry.

Conclusions

(69) Under these circumstances, and based on the above, it is preliminary concluded that, although the Union steel industry has partially recovered for some product categories in 2017, notably due to trade defence measures, for the bulk of product categories under assessment the financial situation is still well below sustainable levels, which makes the Union industry still vulnerable to another surge of imports. Accordingly, the Commission concludes that the Union steel industry is in a situation of threat of serious injury for the 23 product categories under assessment.

CAUSATION Increase of imports

(70) The Commission has made a preliminary determination that there is a causal link between increased imports of the product under assessment on the one hand and a threat of serious injury on the other hand, on the following basis.

(71) It is first recalled that the products produced by the Union producers are like or directly competing with the products concerned. They have the same basic characteristics, the same uses and are sold via similar or identical sales channels and strongly compete on price.

(72) As explained in Sections IV and VI, the Union producers have suffered in terms of loss of market share and significant price pressure resulting in a negative or unsustainable level of profit. For some products, even if the producers have recovered, serious injury appears to be imminent.

(73) In the period 2013-2017, imports of the product concerned increased significantly and took away Union market shares based on lower than EU producers' price levels. Indeed, the market share of imports, overall, grew from 12,2 % to 17,6 % and import prices remained almost systematically lower than the Union sales prices for each individual product.

(74) The causal link between the increased imports and the situation of the Union producers was especially marked in the period 2013-2016, when low priced imports peaked (+ 62 %) and EU producers' prices fell by 15 %. For category 13, the decrease in prices amounted even to 20 % whereas for categories 1 and 3 they were 19 % and 18 % respectively. As a result, Union producers of the like products were either in a loss making situation or just close to break even. In the year 2017, imports remained at a high level and continued to undercut prices, despite a general price increase. EU prices recovered, but not sufficiently for a number of products which were still sold at a loss or reduced profit.

(75) Even if profit recovered for some product categories, their situation is still vulnerable. Indeed, based on previous years' developments, these product categories are particularly sensitive to price pressure, and any further increase of imports at low prices would have a significant negative impact on their situation.

(76) In this context, it is considered that the restrictive measures taken by the U.S. pursuant to Section 232 of the Trade Expansion Act, given their level and scope, are likely to cause imminent serious injury to Union producers.

(77) The Commission therefore provisionally concludes that, in relation to the 23 product categories under assessment, there is a causal link between the increase in imports, the pressure on the Union steel market price and the threat of serious injury suffered by Union producers.

Other known factors

(78) To ensure that the serious injury is not attributable to factors other than the increase in imports, the Commission has carried out a preliminary analysis to determine whether the other factors may have contributed to the serious injury suffered by the Union producers.

(79) The global overcapacity was found to have played a role in the sense that it boosted cheap imports into the Union. Consumption for the steel products concerned increased and could therefore not weaken the causal link.

(80) The Commission also considered the attribution of serious injury due to imports of the products concerned from members of the European Economic Area (EEA). As a result of the EEA Agreement between the Union and its Member States, on the one hand, and members of the EEA (Norway, Iceland, and Liechtenstein), on the other hand, the Union has established a close economic integration with the markets of EEA countries, as well as the industries of the products concerned. The industry in those markets is mature and saturated, due to which it is considered that the exclusion of products originating in the members of the EEA from the safeguard measures will have little (if no) impact on the import levels of the products. Indeed, and while the imports from these countries have indeed contributed for some product categories to an increase in imports (overall imports from these countries show an increase of approximately 9 %), the share of those imports in the total imports is limited (EEA share in imports is about 1,5 %, with a corresponding market share of 0,3 % in total). In addition, EEA members are traditionally minor suppliers of the product concerned to the U.S., which means that the risk of trade diversion has preliminarily been determined to also be limited. Having, therefore, regard to the traditionally minor supplies to the U.S., the maturity of the industry in EEA markets, and the related limited risk of trade diversion stemming therefrom, the Commission considers that imports of the products concerned from EEA members may only have very marginally, if at all contributed to the threat of serious injury.

(81) Consequently, the Commission has not identified other factors that would weaken the causal link between the increase in imports and the serious injury to the Union producers. Nevertheless, a more detailed examination of all other factors that have or may have contributed to the injury will be undertaken in the remainder of the investigation.

CRITICAL SITUATION

(82) As indicated above, Union steel producers are globally in a situation of threat of injury and serious injury is clearly imminent. For some individual product categories, there are already indications pointing towards serious injury. A further increase of imports will likely have significant adverse effects on the economic situation of the industry overall.

(83) The Commission has examined whether critical circumstances exist in which delay would cause damage which it would be difficult to repair. In particular it was examined whether imports have continued to increase in the most recent period.

(84) Based on a comparison between imports of steel products in the first quarter 2018 and the first quarter 2017, it appears that for 18 of the 23 product categories imports increased by 26 %. This increase of imports is significantly more important than that experienced in the period 2016-2017, which was around 2 %.

(85) The 25 % tariffs under Section 232 on steel products were introduced on 23 March 2018. It is at this stage not possible to assess the full effect of the U.S. measures in terms of trade diversion. The increase of imports into the Union in the first quarter 2018 could however be seen as an anticipation of their effects and, therefore, give a good indication of what could be the potential future development of Union imports after the US measures have been imposed.

(86) On 30 May 2018, the U.S. also decided that Section 232 measures should be enforced against the Union, Mexico and Canada. The Commission considers that this is a further critical element since it would not only restrict Union exports but also increase the risk of trade diversion from the other two important steel producing countries.

(87) Given the vulnerable situation of the industry, and in view of the most recent increase of imports, a further oversupply of steel products on the Union market, and the resulting pressure on prices, will undoubtedly have serious consequences on the situation of the Union producers.

(88) Therefore, the Commission considers that, on account of the real risk of trade diversion and the further restriction of imports to the U.S. of important steel producing countries, there are critical circumstances by which any delay in the adoption of provisional safeguard measures would cause damage which would be difficult to repair. The Commission therefore concludes that provisional safeguard measures should be adopted without delay.

UNION INTEREST

(89) In accordance with Article 16 of Regulation 2015/478, it has been examined whether, despite the provisional finding of threat of serious injury, compelling reasons exist for concluding that it is not in the Union interest to adopt provisional measures in this particular case. The analysis of the Union interest was based on an appraisal of all the various interests involved, including those of the Union producers, importers, and users.

(90) The Union industry is composed of around 40 producers, located in many different Member States of the Union, and employing directly more than 180000 people in relation to the 25 products concerned in the period 2013-2017. It has been established that the Union industry faces a threat of serious injury caused by an increase of imports. It is recalled that the Union industry has not benefited from an increase in consumption and that the economic situation of the Union industry remains fragile and vulnerable to further increase of imports. The strategic importance of the steel industry has long been recognised. It is in the Union interest to have a healthy and competitive steel industry. It is clear that if no measures are taken, both the prices and the market share of the Union producers will further decrease resulting in reduced production, increased financial losses and loss of employment, both in the steel industry and in related industries. Imposing provisional safeguard measures will temporary remedy the serious injury and facilitate the adjustment by the Union industry.

(91) Users and importers, in general, seek the lowest possible price for steel, and it is clear that, without measures, prices would be lower. However, it is also in their interests to have a competitive and viable Union steel industry, able to meet their future needs.

(92) In this context, several interested parties to the investigation have claimed that it would not be in the interest of the Union to impose provisional safeguard measures. They claim that measures would almost certainly result in a supply shortage and would therefore place that Union industry in a stronger negotiating position to exert pressure on prices. They further argued that the sources of supply are already limited by the imposition of anti-dumping and anti-subsidy measures and that products which are not available from Union producers or not available sufficiently or with the proper technical specifications must be excluded from safeguard measures.

(93) In order to strike the right balance between the various legitimate interests and since the threat of serious injury is mainly linked in this case to the existence of trade diversion, the Commission considers that the form of the safeguard measures should preserve historical import levels, and that only imports in excess of this level should be subjected to them. In this respect, a system of Tariff Rate Quotas under which no obstacle is raised against traditional trade flows guarantees that the safeguard measures are in line with the Union interest. Such a form of measure would prevent the negative effects of trade diversion for the Union industry, while at the same time preserve traditional trade supply sources and effective competition in the steel market.

(94) In these circumstances, the Commission considers that the risk that the adopted measure triggers a supply shortage or a price increase is not material. Similarly, the claim that certain specific product categories must be excluded from safeguard measures as they are not available from Union producers or not available sufficiently or with the proper technical specifications should be rejected since traditional trade flows will be guaranteed.

(95) Therefore, on balance, the Commission provisionally concludes that the Union interest requires the adoption of provisional safeguard measures under the specific form of a tariff increase which will be applied beyond traditional trade flows on a product category basis.

CONCLUSIONS AND ADOPTION OF PROVISIONAL MEASURES Adoption of provisional measures

(96) It was preliminary concluded that the Union steel industry is in a situation of threat of serious injury for the 23 product categories under assessment and that this situation is likely to develop into actual serious injury in the foreseeable future. Given the critical circumstances, it is considered that provisional safeguard measures should be taken in order to prevent damage to the EU steel industry which would be difficult to repair before the conclusion of the current investigation.

Form and level of measures

(97) For the selection of the appropriate form of measure, the Commission considered the three following elements. First, serious injury to the global Union steel industry is likely to materialise due to the diversion of steel exports to the US to the EU as a consequence of the Section 232 measures. Second, it is considered that the openness of the Union market should be preserved and the traditional flow of imports should be maintained. Indeed, it is basically the excess of imports above these traditional trade flows that are considered to be the main threat for the situation of the steel industry. Finally, in conformity with Article 7(2) of Regulation (EU) 2015/478 and the Union's international obligations, in particular Article 6 of the WTO Agreement on Safeguards, the provisional measures should take the form of tariff measures.

(98) On that basis the Commission considers that, as mentioned in recital (93), the provisional safeguard measures should take the form of a system of tariff rate quotas in excess of which an additional duty will be paid. To ensure access to the Union market to all traditional suppliers, such tariff rate quotas should be based on the average of the annual level of imports in the years 2015, 2016, and 2017. As the tariff rate quotas will be in operation for 200 calendar days, the quotas should be set at a corresponding pro-rata level to the annual figure.

(99) The additional above-quota duty rate should be fixed at a level which is consistent with the aim of preventing serious injury to the Union industry. Given the conclusions on threat of serious injury and the fact that serious injury did not occur yet in overall terms, the Commission considers that calculating an injury margin on the basis of the constructed average non-injurious price per tonne of the Union industry's products in the most recent period does not seem to be appropriate.

(100) Under these circumstances, the Commission rather considers it more appropriate to take a forward-looking approach to assessing the level of the duty necessary to deter imports in excess of traditional trade flows from materialising and producing serious injury to the Union industry once the level of the quota has been reached.

(101) In this respect, the Union industry has submitted two complementary methods to calculate a sufficiently deterring tariff, which the Commission finds adequate for such purpose: the first is a partial equilibrium model of the Union market for steel, whereas the second calculates contribution margins for steel products.

(102) A partial equilibrium model is a set of demand and supply equations focusing on one part of the economy and applying the ceteris paribus assumption to the rest of the economy. It also assumes that the macroeconomic impacts of the scenario that is analysed are not large enough to influence macroeconomic aggregates such as the overall wage level in an economy.

(103) The model proposed by the Union industry is based on publically available code that is programmed and solved in a spreadsheet-software. Partial equilibrium models more broadly are a standard tool for trade policy analysis by investigating authorities, including the Commission.

(104) The model, as most others, applies the so-called Armington assumption that products from different origins are imperfect substitutes. The model looks at the Union market only using a supply function each for Union domestic supply, import supply by countries subject to safeguards and import supply by countries exempted from safeguards. Finally, it employs an Union demand function that responds to the overall price level to determine demand for steel at the aggregate level and distributes this according to relative prices to the three mentioned sources of supply. This latter process is governed by the so-called Armington Elasticities, i.e. economic parameters representing the elasticity of substitution between products from different countries of origin that differ between product types and markets.

(105) The data for the model comes from Eurofer and Eurostat. The Armington Elasticities, as well as the supply and demand elasticities come from established sources such as the U.S. ITC and the Global Trade Analysis Project (GTAP). The Armington Elasticity is set at 3,75, the demand elasticity is set at – 0,5 and the three supply elasticities are set at 4 in accordance with these sources.

(106) Being a one-country-model certain explicit and implicit assumptions need to be made, notably concerning the U.S. steel market and the impact of the measures imposed by invoking Section 232.

(107) First, it is assumed that these measures will succeed in excluding from the U.S. market the current exports of countries subjected to Section 232 measures. In the next step, the proportion of these excluded exports that will be diverted towards the EU market for each producer country currently exporting to the U.S. is calculated according to a methodology under which four different criteria are considered and weighted: distance to the Union, availability in the relevant region of countries capable of absorbing diverted exports, existence of countries in the region with significant overcapacity, and the existence in the country of trade defence measures in place. According to this calculation, 72 % of current US imports of steel will be diverted to the EU market, which corresponds to 55 % of total Union imports of steel in 2017. It is further assumed that these additional imports will displace Union production of the same amount.

(108) The model is specified with the above mentioned parameters and the market data corrected for the assumptions made in the two previous recitals. The model is then solved with experiments of various magnitudes of a Union out-of-quota safeguard tariff. The results of the model predict that a tariff of 25 % would allow import levels that are about 19 % higher than in the reference period of 2015-2017. A tariff of 32 % would still allow 10 % more imports than in the reference period. A tariff of 41 % would, on the other hand, suppress imports to their 2015-2017 level.

(109) The results of the macroeconomic trade model are complemented with a series of microeconomic simulations of typical contribution margins for 12 different product categories under assessment. The assumption behind the analysis is that in case of falling prices, producers would continue to fully utilize their capacities and export to the Union as long as variable costs are covered. The margin between the sales price and variable costs is termed the contribution margin. In other words, a producer would continue producing as long as the contribution margin is non-negative. The analysis establishes for each of the twelve product categories under assessment the Union landed price at which the contribution margin for exporters to the EU would be entirely exhausted. The spread between this price and the non-injurious domestic price on the Union market should then be the out-of-quota tariff necessary to guarantee a non-injurious price level on the Union market.

(110) The analysis uses a basket of raw material prices based on Metal Bulleting public indices, variable cost of Chinese firms from the CRU database and assumed freight costs of $60/tonne between China and the EU, which is stated to be a conservative estimate. It concludes that contribution margins and thus the necessary deterrent out-of-quota tariffs should be in the range of 19-45 %, with a median of 34 %, which would essentially confirm the order of magnitude of the out-of-quota tariff identified by the partial equilibrium model.

(111) On the basis of the above, the Commission has preliminary established that a provisional 25 % out-of-quota tariff would be sufficient to prevent serious injury from occurring. This lower tariff than the 32 % resulting from the model for ensuring a traditional trade plus 10 % import flow increase represents a cautious approach, having regard to the Union interest, and pending comments from interested parties after the adoption of the provisional measures and a closer study of the evolution of imports before the imposition of definitive measures.

Administration of the quotas

(112) The best way of ensuring optimal use of the tariff quotas is to allocate them in the chronological order of the dates on which declarations of release for free circulation are accepted, as provided for in Commission Implementing Regulation (EU) 2015/2447. Equal and continuous access to the quotas should be ensured for all Union importers. This method of administration calls for close cooperation between the Member States and the Commission.

(113) The eligibility of imported goods from developing countries to be excluded from the tariff quotas is dependent on the origin of the goods. The criteria for determining non-preferential origin currently in force in the Union should therefore be applied.

(114) For the purpose of the provisional measures, in order to permit traditional trade flows to continue, a specific quota will be determined for each of the product categories on which this Regulation imposes provisional measures, irrespectively of their country of origin. The remainder of the investigation will determine whether an allocation of quota by exporting country is desirable in order to ensure traditional trade flows from these countries and having regard to the impact of the provisional measures. In particular, the Commission will have to consider the potential effect of the anti-dumping and anti-subsidy measures currently in force on the allocation and usage of a per-country quota.

Applicable anti-dumping and anti-subsidy measures

(115) Once the determined free-of-duty quota is reached, the safeguard measures will apply.

(116) Several interested parties claimed that the combination of the already imposed anti-dumping and countervailing measures on many product categories with the safeguard measures on those same imports would place an undesirably onerous burden on certain exporting producers seeking to export to the EU, which may have the effect of denying them access to the Union market.

(117) Indeed, for 12 steel product categories covered by the current provisional safeguard measures, some countries of origin are currently subject to anti-dumping and countervailing duties. It is therefore necessary to consider whether the cumulation of these measures with the safeguard measures would not lead to a greater effect than desirable. In order to avoid the imposition of double remedies, whenever the tariff quota is exceeded, the level of the existing anti-dumping and countervailing will be suspended or reduced to ensure that the combined effect of these measures does not exceed the highest level of the safeguard or anti-dumping/countervailing duties in place.

Duration

(118) The provisional measures should apply for 200 calendar days from the date on which this Regulation enters into force.

EXCLUSIONS OF CERTAIN COUNTRIES FROM THE SCOPE OF THE PROVISIONAL MEASURES

(119) In accordance with Article 18 of Regulation 2015/478 and the international obligations of the Union, the provisional measures should not apply to any product originating in a developing country as long as its share of imports of that product into the Union does not exceed 3 %, provided that developing country members of the WTO with less than a 3 % import share, collectively account for not more than 9 % of total Union imports of the product concerned.

(120) The preliminary determination made by the Commission shows that the product categories concerned originating in certain developing countries meet the requirements to benefit from the abovementioned derogation. Annex IV (List of products originating in developing countries to which the provisional measures apply) specifies the developing countries for the purposes of this Regulation. It also indicates for each of the 23 product categories the developing countries to which the provisional measures apply. The Commission considers it appropriate at this stage to calculate the volume of imports from developing countries on the basis of each product category since the tariff rate quota is also established by reference to traditional trade flows from each category individually. This is without prejudice as to future decisions regarding whether a country can be considered as a developing country.

(121) As set out in recital (80) above, on account of the close integration of markets with EEA members, the overall figures of imports from these countries, and the low risk of trade diversion, the Commission considers that the products under assessment originating in Norway, Iceland, and Liechtenstein should be excluded from the application of this Regulation,

HAS ADOPTED THIS REGULATION:

Article 1

1. Tariff quotas are hereby opened in relation to imports into the Union of each of the 23 product categories listed in Annex I for a period of 200 days from the entry into force of this Regulation.

2. Tariff quotas are specified in Annex V (defined by reference to the CN codes specified in relation to it).

3. Where the relevant tariff quota is exhausted or where imports of the product categories do not benefit from the relevant tariff quota, an additional duty at the rate of 25 % shall be levied. That additional duty shall apply to the customs value of the product being imported.

Article 2

1. The origin of any product to which this Regulation applies shall be determined in accordance with the provisions in force in the Union relating to non-preferential origin.

2. Unless otherwise specified, the relevant provisions in force concerning customs duties shall apply.

Article 3

The tariff quotas shall be managed by the Commission and the Member States in accordance with the management system for tariff quotas provided for in Articles 49 to 54 of Commission Implementing Regulation (EU) 2015/2447.

Article 4

Imports of the product categories referred to in Article 1, which are already on their way to the Union on the date of entry into force of this Regulation, whose destination cannot be changed, shall not be attributed to the tariff quotas, or subject to the additional duty specified in Article 1, and may be put into free circulation.

Article 5

The Member States and the Commission shall cooperate closely to ensure compliance with this Regulation.

Article 6

1. Subject to paragraph 2, imports of the 23 product categories specified in Annex I originating in one of the developing countries shall, as specified in Annex IV, not be subject to the tariff quotas or subject to the additional duty referred to in Article 1.

2. For each of the 23 product categories, Annex IV specifies the originating developing countries which shall be subject to the measures set out in Article 1.

Article 7

Products originating in Norway, Iceland, and Liechtenstein shall not be subject to the measures set out in Article 1.

Article 8

This Regulation shall enter into force on the day following that of its publication in the Official Journal of the European Union.

This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, 17 July 2018. For the Commission The President Jean-Claude Juncker

ANNEX

ANNEX I Products concerned

Product Number Product category CN Codes 1 Non Alloy and Other Alloy Hot Rolled Sheets and Strips 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, 72269199 2 Non Alloy and Other Alloy Cold Rolled Sheets 72091500, 72091690, 72091790, 72091891, 72092500, 72092690, 72092790, 72092890, 72099020, 72099080, 72112320, 72112330, 72112380, 72112900, 72119020, 72119080, 72255020, 72255080, 72259900, 72262000, 72269200 3 Electrical Sheets (other than GOES) 72091610, 72091710, 72091810, 72092610, 72092710, 72092810, 72251990, 72261980 4 Metallic Coated Sheets 72102000, 72103000, 72104100, 72104900, 72106100, 72106900, 72109080, 72122000, 72123000, 72125020, 72125030, 72125040, 72125061, 72125069, 72125090, 72259100, 72259200, 72269910, 72269930, 72269970 5 Organic Coated Sheets 72107080, 72124080 6 Tin Mill products 72091899, 72101100, 72101220, 72101280, 72105000, 72107010, 72109040, 72121010, 72121090, 72124020 7 Non Alloy and Other Alloy Quarto Plates 72085120, 72085191, 72085198, 72085291, 72089020, 72089080, 72109030, 72254012, 72254040, 72254060 8 Stainless Hot Rolled Sheets and Strips 72191100, 72191210, 72191290, 72191310, 72191390, 72191410, 72191490, 72192210, 72192290, 72192300, 72192400, 72201100, 72201200 9 Stainless Cold Rolled Sheets and Strips 72193100, 72193210, 72193290, 72193310, 72193390, 72193410, 72193490, 72193510, 72193590, 72199020, 72199080, 72202021, 72202029, 72202041, 72202049, 72202081, 72202089, 72209020, 72209080 12 Non Alloy and Other Alloy Merchant Bars and Light Sections 72143000, 72149110, 72149190, 72149931, 72149939, 72149950, 72149971, 72149979, 72149995, 72159000, 72161000, 72162100, 72162200, 72164010, 72164090, 72165010, 72165091, 72165099, 72169900, 72281020, 72282010, 72282091, 72283020, 72283041, 72283049, 72283061, 72283069, 72283070, 72283089, 72286020, 72286080, 72287010, 72287090, 72288000 13 Rebars 72142000, 72149910 14 Stainless Bars and Light Sections 72221111, 72221119, 72221181, 72221189, 72221910, 72221990, 72222011, 72222019, 72222021, 72222029, 72222031, 72222039, 72222081, 72222089, 72223051, 72223091, 72223097, 72224010, 72224050, 72224090 15 Stainless Wire Rod 72210010, 72210090 16 Non Alloy and Other Alloy Wire Rod 72131000, 72132000, 72139110, 72139120, 72139141, 72139149, 72139170, 72139190, 72139910, 72139990, 72271000, 72272000, 72279010, 72279050, 72279095 17 Angles, Shapes and Sections of Iron or Non Alloy Steel 72163110, 72163190, 72163211, 72163219, 72163291, 72163299, 72163310, 72163390 18 Sheet Piling 73011000 20 Gas pipes 73063041, 73063049, 73063072, 73063077 21 Hollow sections 73066110, 73066192, 73066199 22 Seamless Stainless Tubes and Pipes 73041100, 73042200, 73042400, 73044100, 73044910, 73044993, 73044995, 73044999 23 Bearing Tubes and Pipes 73045112, 73045118, 73045932, 73045938 25 Large welded tubes 73051100, 73051200, 73051900, 73052000, 73053100, 73053900, 73059000 26 Other Welded Pipes 73061110, 73061190, 73061910, 73061990, 73062100, 73062900, 73063011, 73063019, 73063080, 73064020, 73064080, 73065020, 73065080, 73066910, 73066990, 73069000 28 Non Alloy Wire 72171010, 72171031, 72171039, 72171050, 72171090, 72172010, 72172030, 72172050, 72172090, 72173041, 72173049, 72173050, 72173090, 72179020, 72179050, 72179090

ANNEX II

II.1 — Growth in imports for the 23 product categories (in tonnes)

Product Number Product category 2013 2014 2015 2016 2017 growth 2017 compared to 2013 1 Non Alloy and Other Alloy Hot Rolled Sheets and Strips 4814207 5212268 7807441 8574007 6991376 45 % 2 Non Alloy and Other Alloy Cold Rolled Sheets 1832159 1903092 2759877 1998437 2462471 34 % 3 Electrical Sheets (other than GOES) 266559 285132 280256 318496 379649 42 % 4 Metallic Coated Sheets 1854963 2202856 2687715 3911752 4980452 168 % 5 Organic Coated Sheets 681698 725296 622553 730625 915248 34 % 6 Tin Mill products 552384 662861 638316 756016 617567 12 % 7 Non Alloy and Other Alloy Quarto Plates 1419767 1959605 2554930 2814802 2530630 78 % 8 Stainless Hot Rolled Sheets and Strips 175836 233028 269697 351075 436173 148 % 9 Stainless Cold Rolled Sheets and Strips 697457 1017613 787521 843352 976108 40 % 12 Non Alloy and Other Alloy Merchant Bars and Light Sections 911115 1219800 1200627 1400824 1385829 52 % 13 Rebars 527008 972602 1430014 1292971 1191445 126 % 14 Stainless Bars and Light Sections 113071 147453 142416 147811 159577 41 % 15 Stainless Wire Rod 52082 71229 57627 58670 62978 21 % 16 Non Alloy and Other Alloy Wire Rod 1125730 1289953 1697912 2000967 2094274 86 % 17 Angles, Shapes and Sections of Iron or Non Alloy Steel 223669 277507 268014 388041 262745 17 % 18 Sheet Piling 15870 16503 14051 36970 85054 436 % 20 Gas pipes 266467 340051 298103 336050 380257 43 % 21 Hollow sections 461263 552874 574490 725545 820667 78 % 22 Seamless Stainless Tubes and Pipes 32581 38782 39719 42510 42701 31 % 23 Bearing Tubes and Pipes 7489 9426 11944 9773 8663 16 % 25 Large welded tubes 286939 411273 209524 159219 1044534 264 % 26 Other Welded Pipes 474949 491934 510548 540386 571167 20 % 28 Non Alloy Wire 573988 722719 692714 736500 722633 26 %

II.2 — Growth in imports for the 23 product categories (in tonnes)

Product Number Product category Q1 2017 Q1 2018 growth Q1 2017 vs. Q1 2018 1 Non Alloy and Other Alloy Hot Rolled Sheets and Strips 1810764 2079408 15 % 2 Non Alloy and Other Alloy Cold Rolled Sheets 679628 630459 – 7 % 3 Electrical Sheets (other than GOES) 80836 114451 42 % 4 Metallic Coated Sheets 1482049 1190741 – 20 % 5 Organic Coated Sheets 212209 201838 – 5 % 6 Tin Mill products 146457 168583 15 % 7 Non Alloy and Other Alloy Quarto Plates 676207 640176 – 5 % 8 Stainless Hot Rolled Sheets and Strips 122092 107577 – 12 % 9 Stainless Cold Rolled Sheets and Strips 229981 280549 22 % 12 Non Alloy and Other Alloy Merchant Bars and Light Sections 319420 466154 46 % 13 Rebars 210505 551316 162 % 14 Stainless Bars and Light Sections 40602 49988 23 % 15 Stainless Wire Rod 14956 19642 31 % 16 Non Alloy and Other Alloy Wire Rod 560863 641668 14 % 17 Angles, Shapes and Sections of Iron or Non Alloy Steel 73733 139670 89 % 18 Sheet Piling 19947 20326 2 % 20 Gas pipes 94430 120512 28 % 21 Hollow sections 223618 256998 15 % 22 Seamless Stainless Tubes and Pipes 12411 12399 0 % 23 Bearing Tubes and Pipes 1316 1498 14 % 25 Large welded tubes 48791 51285 5 % 26 Other Welded Pipes 145059 153106 6 % 28 Non Alloy Wire 176299 202450 15 %

II.3 — Growth in imports for the 5 product categories (in tonnes)

Product Number Product category 2013 2014 2015 2016 2017 growth 2017 compared to 2013 10 Stainless Hot Rolled Quarto Plate 34319 40218 37542 31407 32917 – 4 % 11 Grain-oriented electrical sheet 147565 160580 150047 156477 121947 – 17 % 19 Railway Material 1376 1096 1240 1521 1342 – 2 % 24 Other Seamless tubes 456167 528245 475132 464876 402600 – 12 % 27 Non Alloy and Other Alloy Cold Finished Bars 456791 521976 484927 459327 458310 0 %

ANNEX III Economic indicators for the 23 product categories

Product 1 Non Alloy and Other Alloy Hot Rolled Sheets and Strips

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 30225632 31095524 33121273 34158703 32768375 Imports Volume (tonnes) 4814207 5212268 7807441 8574007 6991376 Market share (%) 15,9 % 16,8 % 23,6 % 25,1 % 21,3 % Unit prices (EUR/tonne) 463 442 396 351 492 Situation of EU producers Utilisation of capacity (%) 75 % 75 % 76 % 75 % 76 % Production (tonnes) 76871621 77990908 77331686 77563694 79568514 Sales volume in the EU (tonnes) 25411425 25883256 25313832 25584696 25776999 Market share (%) 84,1 % 83,2 % 76,4 % 74,9 % 78,7 % Unit sales price (EUR/tonne) 519 493 455 422 556 Net profit/loss on EU sales (in %) – 1,9 % 0,0 % – 3,1 % – 1,0 % 7,8 % Employment (end of period) 37467 35573 35038 33557 34815 Stock 2572574 2580258 2585958 2617556 2749280 Cashflow 448135738 1065492450 763891666 603485811 1369472142 ROCE (%) – 3,8 % 1,0 % – 6,6 % – 1,0 % 7,7 % Price comparison for 2017 Price undercutting 11,5 %

Product 2 Non Alloy and Other Alloy Cold Rolled Sheets

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 9772904 9728449 10353391 9849904 10085487 Imports Volume (tonnes) 1832159 1903092 2759877 1998437 2462471 Market share (%) 18,7 % 19,6 % 26,7 % 20,3 % 24,4 % Unit prices (EUR/tonne) 566 546 485 474 606 Situation of EU producers Utilisation of capacity (%) 71 % 75 % 75 % 75 % 77 % Production (tonnes) 40855196 41632189 41639946 41738974 42811283 Sales volume in the EU (tonnes) 7920370 7805648 7570764 7829002 7602288 Market share (%) 81,0 % 80,2 % 73,1 % 79,5 % 75,4 % Unit sales price (EUR/tonne) 588 558 522 495 633 Net profit/loss on EU sales (in %) – 4,4 % – 2,8 % – 3,0 % 0,6 % 9,8 % Employment (end of period) 12690 11973 11550 11230 11264 Stock 1078838 1052246 1064061 1054347 1093798 Cashflow 200559843 413849620 324264435 454766919 375807983 ROCE (%) – 8,0 % – 2,4 % – 12,8 % – 3,1 % 4,0 % Price comparison for 2017 Price undercutting 4,3 %

Product 3 Electrical Sheets (other than GOES)

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 1267827 1287448 1223892 1255417 1350354 Imports Volume (tonnes) 266559 285132 280256 318496 379649 Market share (%) 21,0 % 22,1 % 22,9 % 25,4 % 28,1 % Unit prices (EUR/tonne) 648 617 578 502 642 Situation of EU producers Utilisation of capacity (%) 87 % 80 % 80 % 82 % 81 % Production (tonnes) 1080894 1110013 1052273 1032560 1114309 Sales volume in the EU (tonnes) 1001268 1002316 943636 936553 969977 Market share (%) 79,0 % 77,9 % 77,1 % 74,6 % 71,8 % Unit sales price (EUR/tonne) 705 657 606 576 699 Net profit/loss on EU sales (in %) – 8,9 % – 8,1 % – 13,0 % – 14,3 % – 3,2 % Employment (end of period) 1522 1707 2087 2069 2065 Stock 45680 136605 142998 125466 148259 Cashflow 110221498 213556132 127226053 131151436 – 89295095 ROCE (%) – 18,3 % – 11,7 % – 38,3 % – 17,9 % – 3,4 % Price comparison for 2017 Price undercutting 8,1 %

Product 4 Metallic Coated Sheets

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 23229673 24289751 25840225 27439848 28231862 Imports Volume (tonnes) 1854963 2202856 2687715 3911752 4980452 Market share (%) 8,0 % 9,1 % 10,4 % 14,3 % 17,6 % Unit prices (EUR/tonne) 679 657 615 530 662 Situation of EU producers Utilisation of capacity (%) 78 % 82 % 84 % 86 % 84 % Production (tonnes) 27930059 29517243 29875495 29905847 30450568 Sales volume in the EU (tonnes) 21344052 22056052 23118423 23490212 23218040 Market share (%) 91,9 % 90,8 % 89,5 % 85,6 % 82,2 % Unit sales price (EUR/tonne) 682 654 614 586 711 Net profit/loss on EU sales (in %) 1,9 % 5,4 % 5,5 % 7,9 % 11,7 % Employment (end of period) 28915 28243 28749 29863 29648 Stock 1970500 2433422 2498143 2329341 2597133 Cashflow 807884294 1353026892 1343062742 1720354890 2020588339 ROCE (%) – 6,8 % – 0,9 % – 10,4 % – 1,7 % 6,0 % Price comparison for 2017 Price undercutting 7,0 %

Product 5 Organic Coated Sheets

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 4533256 4823144 4809384 5121927 5221575 Imports Volume (tonnes) 681698 725296 622553 730625 915248 Market share (%) 15,0 % 15,0 % 12,9 % 14,3 % 17,5 % Unit prices (EUR/tonne) 854 813 813 709 853 Situation of EU producers Utilisation of capacity (%) 70 % 76 % 74 % 76 % 75 % Production (tonnes) 4479238 4564346 4574414 4863169 4940410 Sales volume in the EU (tonnes) 3851467 4097788 4186771 4391169 4306231 Market share (%) 85,0 % 85,0 % 87,1 % 85,7 % 82,5 % Unit sales price (EUR/tonne) 898 868 829 791 934 Net profit/loss on EU sales (in %) – 1,7 % 1,4 % 1,1 % 3,7 % 3,9 % Employment (end of period) 6377 6272 6047 6150 6095 Stock 239236 182275 197241 214384 258114 Cashflow 152893378 351790418 321603588 361237401 79886901 ROCE (%) – 7,6 % – 2,1 % – 12,9 % – 2,7 % 3,7 % Price comparison for 2017 Price undercutting 8,6 %

Product 6 Tin Mill Products

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 3638423 3758879 3789391 3792575 3695205 Imports Volume (tonnes) 552384 662861 638316 756016 617567 Market share (%) 15,2 % 17,6 % 16,8 % 19,9 % 16,7 % Unit prices (EUR/tonne) 822 792 781 667 753 Situation of EU producers Utilisation of capacity (%) 82 % 84 % 84 % 82 % 84 % Production (tonnes) 4223583 4315402 4353002 4302367 4295575 Sales volume in the EU (tonnes) 3085602 3095745 3150741 3036316 3077185 Market share (%) 84,8 % 82,4 % 83,1 % 80,1 % 83,3 % Unit sales price (EUR/tonne) 845 821 789 728 812 Net profit/loss on EU sales (in %) 1,7 % 4,1 % 4,8 % 4,6 % 3,1 % Employment (end of period) 7939 7660 7683 7819 7424 Stock 380445 394384 394712 297877 356460 Cashflow 117064184 201350074 291440814 272002110 133250945 ROCE (%) – 18,6 % – 10,1 % – 35,2 % – 20,4 % – 25,0 % Price comparison for 2017 Price undercutting 7,3 %

Product 7 Non Alloy and Other Alloy Quarto Plates

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 10148839 10375274 10934966 11058596 11059068 Imports Volume (tonnes) 1419767 1959605 2554930 2814802 2530630 Market share (%) 14,0 % 18,9 % 23,4 % 25,5 % 22,9 % Unit prices (EUR/tonne) 513 492 474 403 533 Situation of EU producers Utilisation of capacity (%) 58 % 62 % 62 % 63 % 65 % Production (tonnes) 10749475 11240103 10608260 10244950 10581040 Sales volume in the EU (tonnes) 8727826 8414892 8377455 8242865 8527686 Market share (%) 14,0 % 18,9 % 23,4 % 25,5 % 22,9 % Unit sales price (EUR/tonne) 700 676 714 582 692 Net profit/loss on EU sales (in %) – 9,4 % – 8,9 % – 4,0 % – 7,5 % 3,2 % Employment (end of period) 18472 17628 17177 16763 16211 Stock 707152 788008 896708 862084 819690 Cashflow 45651999 123399207 426592285 – 44547318 205976592 ROCE (%) – 12,2 % – 0,3 % – 3,3 % – 9,9 % – 1,5 % Price comparison for 2017 Price undercutting 23,0 %

Product 8 Stainless Hot Rolled Sheets and Strips

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 1168291 1352875 1590437 1807242 1487848 Imports Volume (tonnes) 175836 233028 269697 351075 436173 Market share (%) 15,1 % 17,2 % 17,0 % 19,4 % 29,3 % Unit prices (EUR/tonne) 2011 1926 1877 1518 1822 Situation of EU producers Utilisation of capacity (%) 61 % 65 % 69 % 73 % 73 % Production (tonnes) 3334814 3525794 3664821 3842503 3799867 Sales volume in the EU (tonnes) 991962 1119435 1320528 1455714 1050966 Market share (%) 84,9 % 82,7 % 83,0 % 80,5 % 70,6 % Unit sales price (EUR/tonne) 2023 2013 2028 1792 2115 Net profit/loss on EU sales (in %) – 4,2 % – 0,3 % 4,0 % 4,9 % 9,2 % Employment (end of period) 5439 4914 4464 4271 4133 Stock 103375 131557 123098 106508 93335 Cashflow 144497251 182932062 613851975 116754324 218815195 ROCE (%) – 33,7 % – 37,1 % – 1,5 % – 0,4 % 13,6 % Price comparison for 2017 Price undercutting 13,9 %

Product 9 Stainless Cold Rolled Sheets and Strips

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 3362718 3671898 3587237 3913974 3816472 Imports Volume (tonnes) 697457 1017613 787521 843352 976108 Market share (%) 20,7 % 27,7 % 22,0 % 21,5 % 25,6 % Unit prices (EUR/tonne) 2098 1985 2064 1782 2023 Situation of EU producers Utilisation of capacity (%) 71 % 76 % 80 % 84 % 84 % Production (tonnes) 3076074 3016723 3139572 3425201 3114323 Sales volume in the EU (tonnes) 2664602 2653177 2798719 3070197 2839979 Market share (%) 79,2 % 72,3 % 78,0 % 78,4 % 74,4 % Unit sales price (EUR/tonne) 2259 2272 2238 2014 2323 Net profit/loss on EU sales (in %) – 4,2 % – 2,7 % 2,4 % 5,5 % 9,4 % Employment (end of period) 10205 9483 9220 8892 8812 Stock 179087 206956 219170 215904 213931 Cashflow 135463456 45971825 847696098 450355017 685492711 ROCE (%) – 12,4 % – 7,7 % 8,5 % 10,6 % 21,5 % Price comparison for 2017 Price undercutting 12,9 %

Product 12 Non Alloy and Other Alloy Merchant Bars and light Sections

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 11891558 12422902 12297356 12678733 13617607 Imports Volume (tonnes) 911115 1219800 1200627 1400824 1385829 Market share (%) 7,7 % 9,8 % 9,8 % 11,0 % 10,2 % Unit prices (EUR/tonne) 699 657 640 531 641 Situation of EU producers Utilisation of capacity (%) 79 % 82 % 80 % 80 % 74 % Production (tonnes) 12132593 12585360 12301986 11839241 12427808 Sales volume in the EU (tonnes) 10964010 11189221 11095204 11276054 12230774 Market share (%) 92,2 % 90,1 % 90,2 % 88,9 % 89,8 % Unit sales price (EUR/tonne) 632 613 573 520 592 Net profit/loss on EU sales (in %) 2,2 % 3,4 % 2,4 % 0,8 % 3,6 % Employment (end of period) 9537 9734 10057 10342 10486 Stock 749386 888456 914268 943355 1023612 Cashflow 220994774 264742034 272433127 255904385 123997731 ROCE (%) – 1,2 % 3,7 % 3,3 % 3,9 % 6,9 % Price comparison for 2017 Price undercutting – 8,3 %

Product 13 Rebars

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 9617685 10359993 10664689 11099947 11253309 Imports Volume (tonnes) 527008 972602 1430014 1292971 1191445 Market share (%) 5,5 % 9,4 % 13,4 % 11,6 % 10,6 % Unit prices (EUR/tonne) 475 446 388 353 441 Situation of EU producers Utilisation of capacity (%) 72 % 72 % 71 % 73 % 67 % Production (tonnes) 13171558 13019699 12763140 13191436 12494712 Sales volume in the EU (tonnes) 8906120 9187941 9019809 9568119 9848615 Market share (%) 92,6 % 88,7 % 84,6 % 86,2 % 87,5 % Unit sales price (EUR/tonne) 460 437 386 367 436 Net profit/loss on EU sales (in %) – 2,0 % – 2,5 % – 2,6 % 3,4 % 4,8 % Employment (end of period) 5563 5441 5529 5634 5457 Stock 761808 683591 642506 602948 659484 Cashflow 20571082 14116433 53015513 165167521 249292475 ROCE (%) 0,9 % 2,4 % 1,9 % 6,2 % 9,3 % Price comparison for 2017 Price undercutting – 1,3 %

Product 14 Stainless Bars and light Shapes

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 526080 593501 593530 630737 632804 Imports Volume (tonnes) 113071 147453 142416 147811 159577 Market share (%) 21,5 % 24,8 % 24,0 % 23,4 % 25,2 % Unit prices (EUR/tonne) 3092 2894 3035 2590 2885 Situation of EU producers Utilisation of capacity (%) 65 % 68 % 68 % 69 % 72 % Production (tonnes) 527386 597178 599927 637938 641446 Sales volume in the EU (tonnes) 411655 444339 450094 482314 472247 Market share (%) 78,2 % 74,9 % 75,8 % 76,5 % 74,6 % Unit sales price (EUR/tonne) 2988 2969 2838 2404 2807 Net profit/loss on EU sales (in %) 5,2 % 5,6 % 4,1 % 2,3 % 5,8 % Employment (end of period) 3680 3766 3737 3789 3844 Stock 83561 91900 89676 90409 90893 Cashflow 111869518 142849693 191511047 155623001 145832442 ROCE (%) 1,0 % 4,3 % 1,4 % – 0,7 % 4,9 % Price comparison for 2017 Price undercutting – 2,8 %

Product 15 Stainless Wire Rod

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 318373 323191 304987 335552 347077 Imports Volume (tonnes) 52082 71229 57627 58670 62978 Market share (%) 16,4 % 22,0 % 18,9 % 17,5 % 18,1 % Unit prices (EUR/tonne) 2300 2193 2310 1962 2228 Situation of EU producers Utilisation of capacity (%) 63 % 64 % 65 % 69 % 71 % Production (tonnes) 373010 383586 388273 412892 449392 Sales volume in the EU (tonnes) 266290 251961 247359 276880 284098 Market share (%) 83,6 % 78,0 % 81,1 % 82,5 % 81,9 % Unit sales price (EUR/tonne) 2480 2516 2382 2022 2417 Net profit/loss on EU sales (in %) – 3,7 % – 2,1 % – 4,7 % – 3,1 % 3,9 % Employment (end of period) 1677 1671 1731 1761 1852 Stock 24810 28696 31083 31584 43800 Cashflow 13022575 18221077 106175940 84328053 44337763 ROCE (%) – 0,7 % 2,9 % – 1,5 % – 2,8 % 5,5 % Price comparison for 2017 Price undercutting 7,8 %

Product 16 Non Alloy and Other Alloy Wire Rod

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 18033534 18249258 18949497 19375225 20026426 Imports Volume (tonnes) 1125730 1289953 1697912 2000967 2094274 Market share (%) 6,2 % 7,1 % 9,0 % 10,3 % 10,5 % Unit prices (EUR/tonne) 522 504 439 392 486 Situation of EU producers Utilisation of capacity (%) 80 % 84 % 83 % 81 % 83 % Production (tonnes) 19765154 19775715 20436595 20037883 20757864 Sales volume in the EU (tonnes) 16782585 16828358 17108877 17222468 17795595 Market share (%) 93,1 % 92,2 % 90,3 % 88,9 % 88,9 % Unit sales price (EUR/tonne) 509 492 443 420 505 Net profit/loss on EU sales (in %) 1,8 % 4,8 % 3,0 % 0,6 % 3,4 % Employment (end of period) 11561 11598 11881 13068 13058 Stock 876450 896633 1120091 974085 954649 Cashflow 234768428 424076182 365467214 287106970 310381566 ROCE (%) 1,0 % 6,9 % 2,9 % 3,9 % 6,7 % Price comparison for 2017 Price undercutting 3,7 %

Product 17 Angles shapes and sections of iron or non alloy steel

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 6159135 6544142 6549935 7205377 7375383 Imports Volume (tonnes) 223669 277507 268014 388041 262745 Market share (%) 3,6 % 4,2 % 4,1 % 5,4 % 3,6 % Unit prices (EUR/tonne) 539 509 463 409 473 Situation of EU producers Utilisation of capacity (%) 64 % 69 % 71 % 72 % 72 % Production (tonnes) 8583668 8590216 8894223 9400691 9605365 Sales volume in the EU (tonnes) 5935432 6266353 6281426 6817231 7112453 Market share (%) 96,4 % 95,8 % 95,9 % 94,6 % 96,4 % Unit sales price (EUR/tonne) 471 471 449 417 463 Net profit/loss on EU sales (in %) – 6,5 % – 3,7 % – 0,6 % 2,1 % – 1,8 % Employment (end of period) 6212 5685 6006 6264 6096 Stock 510927 464184 466561 559452 569947 Cashflow – 48381794 7224031 161157041 150487051 – 18595244 ROCE (%) – 6,0 % 6,3 % 1,4 % 3,9 % 0,6 % Price comparison for 2017 Price undercutting – 2,1 %

Product 18 Sheet piling

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 574025 637684 577270 584985 626863 Imports Volume (tonnes) 15870 16503 14051 36970 85054 Market share (%) 2,8 % 2,6 % 2,4 % 6,3 % 13,6 % Unit prices (EUR/tonne) 787 765 1126 651 629 Situation of EU producers Utilisation of capacity (%) 78 % 82 % 76 % 82 % 81 % Production (tonnes) 907320 940451 840182 777182 817764 Sales volume in the EU (tonnes) 558131 621150 563140 548010 541782 Market share (%) 97,2 % 97,4 % 97,6 % 93,7 % 86,4 % Unit sales price (EUR/tonne) 711 697 652 623 640 Net profit/loss on EU sales (in %) 6,8 % 11,5 % 8,8 % 14,0 % 3,7 % Employment (end of period) 949 971 951 981 995 Stock 49762 47610 58744 68417 75616 Cashflow 58272442 68732139 63936644 86404634 40555786 ROCE (%) – 9,3 % 6,8 % 6,7 % 10,3 % 1,5 % Price comparison for 2017 Price undercutting 1,7 %

Product 20 Gas pipes

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 1211435 1662233 1653112 1637097 1642935 Imports Volume (tonnes) 266467 340051 298103 336050 380257 Market share (%) 22,0 % 20,5 % 18,0 % 20,5 % 23,1 % Unit prices (EUR/tonne) 688 649 646 566 676 Situation of EU producers Utilisation of capacity (%) 37 % 38 % 38 % 40 % 37 % Production (tonnes) 1053283 1460549 1471772 1396933 1392404 Sales volume in the EU (tonnes) 944903 1322070 1354273 1300727 1262560 Market share (%) 78,0 % 79,5 % 81,9 % 79,5 % 76,8 % Unit sales price (EUR/tonne) 717 666 619 580 693 Net profit/loss on EU sales (in %) 0,9 % 1,3 % 2,3 % 3,9 % 0,5 % Employment (end of period) 552 543 548 526 509 Stock 55178 55305 53434 58081 50697 Cashflow 15451286 15884723 16166705 15309189 20506964 ROCE (%) 3,7 % 3,9 % 1,1 % 1,7 % 8,7 % Price comparison for 2017 Price undercutting 2,4 %

Product 21 Hollow sections

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 3347996 3407926 3511951 3885748 4028730 Imports Volume (tonnes) 461263 552874 574490 725545 820667 Market share (%) 13,8 % 16,2 % 16,4 % 18,7 % 20,4 % Unit prices (EUR/tonne) 599 571 553 497 618 Situation of EU producers Utilisation of capacity (%) 46 % 46 % 46 % 47 % 49 % Production (tonnes) 3019375 3019977 3106261 3333368 3388786 Sales volume in the EU (tonnes) 2882473 2854843 2936771 3159965 3207994 Market share (%) 86,1 % 83,8 % 83,6 % 81,3 % 79,6 % Unit sales price (EUR/tonne) 606 569 541 517 625 Net profit/loss on EU sales (in %) – 2,7 % – 3,9 % – 3,3 % 0,2 % – 0,5 % Employment (end of period) 1073 1124 1200 1209 1181 Stock 160442 138981 146353 107826 149537 Cashflow – 9630441 13389861 23807058 13000201 21372166 ROCE (%) – 2,4 % – 5,3 % – 6,2 % – 0,6 % 7,2 % Price comparison for 2017 Price undercutting 1,2 %

Product 22 Seamless stainless tubes and pipes

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 96507 101504 97341 96320 95672 Imports Volume (tonnes) 32581 38782 39719 42510 42701 Market share (%) 33,8 % 38,2 % 40,8 % 44,1 % 44,6 % Unit prices (EUR/tonne) 6941 6167 6118 5846 6300 Situation of EU producers Utilisation of capacity (%) 6 % 7 % 6 % 6 % 6 % Production (tonnes) 116630 124135 101291 101831 92357 Sales volume in the EU (tonnes) 61822 61708 56802 53196 52083 Market share (%) 64,1 % 60,8 % 58,4 % 55,2 % 54,4 % Unit sales price (EUR/tonne) 7913 7740 8318 7361 7993 Net profit/loss on EU sales (in %) 3,1 % 5,9 % – 0,4 % – 0,1 % 1,2 % Employment (end of period) 11180 11211 10369 9779 9317 Stock 7452 9389 10455 8690 11688 Cashflow 19858477 10438041 – 48885671 4038078 – 22872178 ROCE (%) 22,7 % – 4,3 % – 58,1 % – 33,4 % – 50,5 % Price comparison for 2017 Price undercutting 21,2 %

Product 23 Bearing tubes and pipes

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 68824 72805 67249 59867 65355 Imports Volume (tonnes) 7489 9426 11944 9773 8663 Market share (%) 10,9 % 12,9 % 17,8 % 16,3 % 13,3 % Unit prices (EUR/tonne) 2069 1626 1749 1630 1608 Situation of EU producers Utilisation of capacity (%) 68 % 64 % 53 % 52 % 63 % Production (tonnes) 64972 65475 58407 52494 57657 Sales volume in the EU (tonnes) 61324 63378 55304 50092 56691 Market share (%) 89,1 % 87,1 % 82,2 % 83,7 % 86,7 % Unit sales price (EUR/tonne) 2023 2003 1925 1804 1837 Net profit/loss on EU sales (in %) 4,6 % 4,9 % – 6,7 % – 9,2 % – 1,8 % Employment (end of period) 332 322 306 274 280 Stock 1285 1433 2591 1452 2429 Cashflow 3499664 3928566 5055796 – 791310 – 620461 ROCE (%) 0,9 % – 3,3 % – 64,7 % – 54,5 % – 28,1 % Price comparison for 2017 Price undercutting 12,5 %

Product 25 Large welded tubes

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 669846 1041055 427457 586746 1804463 Imports Volume (tonnes) 286939 411273 209524 159219 1044534 Market share (%) 42,8 % 39,5 % 49,0 % 27,1 % 57,9 % Unit prices (EUR/tonne) 1070 793 904 772 936 Situation of EU producers Utilisation of capacity (%) 26 % 32 % 29 % 35 % 65 % Production (tonnes) 1333900 1150000 1034600 1086300 1500000 Sales volume in the EU (tonnes) 382758 624819 216243 426937 759478 Market share (%) 57,1 % 60,0 % 50,6 % 72,8 % 42,1 % Unit sales price (EUR/tonne) 894 887 835 771 766 Net profit/loss on EU sales (in %) 3,0 % – 6,1 % – 2,7 % – 0,6 % 0,0 % Employment (end of period) 1512 1545 1365 1372 1326 Stock 322722 600020 633600 727048 1139429 Cashflow 197726967 – 97558802 94492289 – 70888943 13666659 ROCE (%) – 15,8 % – 23,5 % – 17,7 % – 6,7 % 9,1 % Price comparison for 2017 Price undercutting – 22,0 %

Product 26 Other welded tubes

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 2385499 3121613 3126300 3286436 3352661 Imports Volume (tonnes) 474949 491934 510548 540386 571167 Market share (%) 19,9 % 15,8 % 16,3 % 16,4 % 17,0 % Unit prices (EUR/tonne) 1352 1376 1397 1262 1431 Situation of EU producers Utilisation of capacity (%) 57 % 57 % 57 % 58 % 60 % Production (tonnes) 2384152 3166935 3144492 3190480 3301195 Sales volume in the EU (tonnes) 1907944 2622348 2588536 2721349 2765915 Market share (%) 80,0 % 84,0 % 82,8 % 82,8 % 82,5 % Unit sales price (EUR/tonne) 1024 1013 984 942 1062 Net profit/loss on EU sales (in %) 1,2 % 2,4 % 1,7 % 4,2 % 4,3 % Employment (end of period) 3024 3013 3011 3089 3025 Stock 125621 84268 100035 120308 120420 Cashflow 66281502 68619951 77514611 87283492 106630804 ROCE (%) 9,1 % 11,5 % 8,8 % 12,8 % 19,3 % Price comparison for 2017 Price undercutting – 34,8 %

Product 28 Steel Wire

Data per Calendar Year 2013 2014 2015 2016 2017 Consumption (tonnes) 1318451 1517192 1480243 1513248 1505202 Imports Volume (tonnes) 574083 722773 692918 736623 722858 Market share (%) 43,5 % 47,6 % 46,8 % 48,7 % 48,0 % Unit prices (EUR/tonne) 781 729 722 626 708 Situation of EU producers Utilisation of capacity (%) 73 % 75 % 77 % 73 % 71 % Production (tonnes) 899763 932496 940169 886666 900054 Sales volume in the EU (tonnes) 744368 794419 787325 776626 782344 Market share (%) 56,5 % 52,4 % 53,2 % 51,3 % 52,0 % Unit sales price (EUR/tonne) 940 909 840 832 905 Net profit/loss on EU sales (in %) 0,5 % 0,0 % 1,1 % 2,6 % 0,8 % Employment (end of period) 3387 3395 3429 3459 3408 Stock Cashflow 66281502 68619951 77514611 87283492 106630804 ROCE (%) Price comparison for 2017 Price undercutting 21,8 %

ANNEX IV List of products originating in developing countries to which the provisional measures apply

Country/Product group 1 2 3 4 5 6 7 8 9 12 13 14 15 16 17 18 20 21 22 23 25 26 28 Afghanistan Albania Angola Antigua and Barbuda Argentina Armenia Bahrain, Kingdom of Bangladesh Barbados Belize Benin Bolivia, Plurinational State of Botswana Brazil x x x x x Brunei Darussalam Burkina Faso Burundi Cabo Verde Cambodia Cameroon Central African Republic Chad Chile China x x x x x x x x x x x x x Colombia Congo Costa Rica Côte d'Ivoire Cuba Democratic Republic of the Congo Djibouti Dominica Dominican Republic Ecuador Egypt x x El Salvador Fiji Gabon Gambia Georgia Ghana Grenada Guatemala Guinea Guinea-Bissau Guyana Haiti Honduras Hong Kong, China India x x x x x x x x x x x x x x Indonesia x Jamaica Jordan Kazakhstan Kenya Kuwait, the State of Kyrgyz Republic Lao People's Democratic Republic Lesotho Liberia Macao, China Madagascar Malawi Malaysia x Maldives Mali Mauritania Mauritius Mexico Moldova, Republic of x x Mongolia Montenegro Morocco Mozambique Myanmar Namibia Nepal Nicaragua Niger Nigeria Oman Pakistan Panama Papua New Guinea Paraguay Peru Philippines Qatar Rwanda Saint Kitts and Nevis Saint Lucia Saint Vincent and the Grenadines Samoa Saudi Arabia, Kingdom of x Senegal Seychelles Sierra Leone Solomon Islands South Africa x x Sri Lanka Suriname Swaziland Tajikistan Tanzania Thailand the former Yugoslav Republic of Macedonia x x x x Togo Tonga Trinidad and Tobago Tunisia Turkey x x x x x x x x x x x x x x Uganda Ukraine x x x x x x x x x x x United Arab Emirates x x Uruguay Vanuatu Venezuela, Bolivarian Republic of Viet Nam x x x Yemen Zambia Zimbabwe

ANNEX V Tariff quotas

Product Number Order Number Product category CN Codes Volume of tariff quota (net tonnes) Additional duty rate 1 09.8501 Non Alloy and Other Alloy Hot Rolled Sheets and Strips 72081000, 72082500, 72082600, 72082700, 72083600, 72083700, 72083800, 72083900, 72084000, 72085299, 72085390, 72085400, 72111400, 72111900, 72126000, 72251910, 72253010, 72253030, 72253090, 72254015, 72254090, 72261910, 72269120, 72269191, 72269199 4269009 25 % 2 09.8502 Non Alloy and Other Alloy Cold Rolled Sheets 72091500, 72091690, 72091790, 72091891, 72092500, 72092690, 72092790, 72092890, 72099020, 72099080, 72112320, 72112330, 72112380, 72112900, 72119020, 72119080, 72255020, 72255080, 72262000, 72269200 1318865 25 % 3 09.8503 Electrical Sheets (other than GOES) 72091610, 72091710, 72091810, 72092610, 72092710, 72092810, 72251990, 72261980 178704 25 % 4 09.8504 Metallic Coated Sheets 72102000, 72103000, 72104100, 72104900, 72106100, 72106900, 72109080, 72122000, 72123000, 72125020, 72125030, 72125040, 72125061, 72125069, 72125090, 72259100, 72259200, 72269910, 72269930, 72269970 2115054 25 % 5 09.8505 Organic Coated Sheets 72107080, 72124080 414324 25 % 6 09.8506 Tin Mill products 72091899, 72101100, 72101220, 72101280, 72105000, 72107010, 72109040, 72121010, 72121090, 72124020 367470 25 % 7 09.8507 Non Alloy and Other Alloy Quarto Plates 72085120, 72085191, 72085198, 72085291, 72089020, 72089080, 72109030, 72254012, 72254040, 72254060, 72259900 1442988 25 % 8 09.8508 Stainless Hot Rolled Sheets and Strips 72191100, 72191210, 72191290, 72191310, 72191390, 72191410, 72191490, 72192210, 72192290, 72192300, 72192400, 72201100, 72201200 193049 25 % 9 09.8509 Stainless Cold Rolled Sheets and Strips 72193100, 72193210, 72193290, 72193310, 72193390, 72193410, 72193490, 72193510, 72193590, 72199020, 72199080, 72202021, 72202029, 72202041, 72202049, 72202081, 72202089, 72209020, 72209080 476161 25 % 12 09.8512 Non Alloy and Other Alloy Merchant Bars and Light Sections 72143000, 72149110, 72149190, 72149931, 72149939, 72149950, 72149971, 72149979, 72149995, 72159000, 72161000, 72162100, 72162200, 72164010, 72164090, 72165010, 72165091, 72165099, 72169900, 72281020, 72282010, 72282091, 72283020, 72283041, 72283049, 72283061, 72283069, 72283070, 72283089, 72286020, 72286080, 72287010, 72287090, 72288000 728270 25 % 13 09.8513 Rebars 72142000, 72149910 714964 25 % 14 09.8514 Stainless Bars and Light Sections 72221111, 72221119, 72221181, 72221189, 72221910, 72221990, 72222011, 72222019, 72222021, 72222029, 72222031, 72222039, 72222081, 72222089, 72223051, 72223091, 72223097, 72224010, 72224050, 72224090 82156 25 % 15 09.8515 Stainless Wire Rod 72210010, 72210090 32744 25 % 16 09.8516 Non Alloy and Other Alloy Wire Rod 72131000, 72132000, 72139110, 72139120, 72139141, 72139149, 72139170, 72139190, 72139910, 72139990, 72271000, 72272000, 72279010, 72279050, 72279095 1058110 25 % 17 09.8517 Angles, Shapes and Sections of Iron or Non Alloy Steel 72163110, 72163190, 72163211, 72163219, 72163291, 72163299, 72163310, 72163390 167817 25 % 18 09.8518 Sheet Piling 73011000 24854 25 % 20 09.8520 Gas pipes 73063041, 73063049, 73063072, 73063077 185280 25 % 21 09.8521 Hollow sections 73066110, 73066192, 73066199 387343 25 % 22 09.8522 Seamless Stainless Tubes and Pipes 73041100, 73042200, 73042400, 73044100, 73044910, 73044993, 73044995, 73044999 22818 25 % 23 09.8523 Bearing Tubes and Pipes 73045112, 73045118, 73045932, 73045938 5549 25 % 25 09.8525 Large welded tubes 73051100, 73051200, 73051900, 73052000, 73053100, 73053900, 73059000 258133 25 % 26 09.8526 Other Welded Pipes 73061110, 73061190, 73061910, 73061990, 73062100, 73062900, 73063011, 73063019, 73063080, 73064020, 73064080, 73065020, 73065080, 73066910, 73066990, 73069000 296274 25 % 28 09.8528 Non Alloy Wire 72171010, 72171031, 72171039, 72171050, 72171090, 72172010, 72172030, 72172050, 72172090, 72173041, 72173049, 72173050, 72173090, 72179020, 72179050, 72179090 393031 25 %

Versions

1. 2018-07-17

Cited by

• Commission Implementing Regulation (EU) 2026/1930 of 4 August 2026 on the implementation of bilateral safeguard measures on imports of steel products covered by Regulation (EU) 2026/1384 of the European Parliament and of the Council and originating in certain countries with which the Union has concluded free trade agreements Regulation · Grade B

  In Commission Regulation (EU) 2018/1013 (the provisional steel safeguard Regulation), the Commission found that the 26 product categories produced by the Union producers are like or directly competing with the product concerned. Both the domestic and imported products possess the same fundamental physical, technical and chemical characteristics. They serve identical purposes and are offered through similar or identical sales channels to customers who may acquire them from both domestic and foreign suppliers. Accordingly, there exists a significant level of competition between the product conce

• Commission Implementing Regulation (EU) 2019/159 of 31 January 2019 imposing definitive safeguard measures against imports of certain steel products Regulation · Grade B

  On 18 July 2018, Commission implementing regulation (EU) 2018/1013 imposed provisional safeguard measures with regard to imports of certain steel products (the provisional Regulation).

• Commission Implementing Regulation (EU) 2019/159 of 31 January 2019 imposing definitive safeguard measures against imports of certain steel products Regulation · Grade B

  Any amounts paid in respect of additional duties imposed pursuant to Implementing Regulation (EU) 2018/1013 in relation to the products specified in Annex IV of this Regulation shall be definitively collected at the level set in Article 1(3) of Implementing Regulation (EU) 2018/1013.

• Commission Implementing Regulation (EU) 2022/664 of 21 April 2022 amending Implementing Regulation (EU) 2019/159 imposing a definitive safeguard measure against imports of certain steel products Regulation · Grade B

  By Commission Implementing Regulation (EU) 2018/1013 the European Commission (the Commission) imposed a provisional safeguard measure on certain steel products (the provisional measure).

• Commission Implementing Regulation (EU) 2018/1712 of 13 November 2018 amending Implementing Regulation (EU) 2018/1013 imposing provisional safeguard measures with regard to imports of certain steel products Regulation · Grade B

  On 18 July 2018, by Implementing Regulation (EU) 2018/1013 the Commission imposed provisional safeguard measures on imports of certain steel products. South Africa was covered by the scope of those measures.

• Commission Implementing Regulation (EU) 2018/1712 of 13 November 2018 amending Implementing Regulation (EU) 2018/1013 imposing provisional safeguard measures with regard to imports of certain steel products Regulation · Grade B

  Implementing Regulation (EU) 2018/1013 should therefore be amended in order to remove South Africa from the scope of the provisional measures on these two product categories.

• Commission Implementing Regulation (EU) 2018/1712 of 13 November 2018 amending Implementing Regulation (EU) 2018/1013 imposing provisional safeguard measures with regard to imports of certain steel products Regulation · Grade B

  From a general point of view, the exclusion of South Africa does also not change the development of imports overall given its small share of less than 0,5 % of the total imports during the period 2013-2017. For the same reason, imports from South Africa do not alter the conclusions of recital (81) of Implementing Regulation (EU) 2018/1013 concerning the impact of other factors on the situation of the Union industry.

• Commission Implementing Regulation (EU) 2018/1712 of 13 November 2018 amending Implementing Regulation (EU) 2018/1013 imposing provisional safeguard measures with regard to imports of certain steel products Regulation · Grade B

  Imports of product categories 8 and 9 listed in Annex V of Implementing Regulation (EU) 2018/1013 and originating in South Africa shall not be subject to the provisional safeguard measures imposed by Implementing Regulation (EU) 2018/1013. Annex V of Implementing Regulation (EU) 2018/1013 concerning product categories 8 and 9 shall be replaced as follows:

• Commission Implementing Regulation (EU) 2018/1712 of 13 November 2018 amending Implementing Regulation (EU) 2018/1013 imposing provisional safeguard measures with regard to imports of certain steel products Regulation · Grade B

  Annex IV of Implementing Regulation (EU) 2018/1013, should be amended in so far as product groups 8 and 9 originating in South Africa are concerned, in order to reflect the provisions of Article 1. Annex IV of Implementing Regulation (EU) 2018/1013 concerning South Africa shall be replaced as follows:

• Commission Implementing Regulation (EU) 2018/1712 of 13 November 2018 amending Implementing Regulation (EU) 2018/1013 imposing provisional safeguard measures with regard to imports of certain steel products Regulation · Grade B

  Goods originating in South Africa falling within product categories 8 and 9 that were imported into the EU after the entry into force of Implementing Regulation (EU) 2018/1013 should be excluded from the calculation of the free of duty quota.

• Commission Implementing Regulation (EU) 2023/104 of 12 January 2023 amending Implementing Regulation (EU) 2019/159 imposing a definitive safeguard measure on imports of certain steel products following a report adopted by the World Trade Organization’s Dispute Settlement Body Regulation · Grade B

  By Commission Implementing Regulation (EU) 2018/1013 (the Provisional Regulation), the Commission imposed a provisional safeguard measure on certain steel products. By Commission Implementing Regulation (EU) 2019/159 (the Definitive Regulation), the European Commission imposed a definitive safeguard measure on certain steel products (the safeguard measure).