The latest steel trade figures confirm that import pressure increased further in the second quarter of 2011. Total third country imports rose 45% YoY and were almost 20% higher than in the first quarter of this year. At a monthly level of just under 3.1 million tonnes, third country imports reached the highest level in three years time. The share of imports in the EU steel market was 21% in Q2 compared with on average of almost 16% in 2010.

In line with the trend seen in 2010, particularly imports of flat products have risen sharply so far this year. In the first 8 months of this year, quarto plate imports rose by 89% YoY, cold rolled imports 68% and hot rolled coil imports 43%. Total flat imports were 51% up on last year compared with 21% for long products. Within this product group, differentials at the product level are significant with falling wire rod and rebar imports being overshadowed by a strong rise in merchant bars.

With respect to the main countries of origin, China has remained the dominant third country supplier for several products, most notably hot dipped galvanized sheets and organic coated sheets.

Meanwhile, nearby steel producer Turkey has stepped up its flat product deliveries to the EU steel market. In the January to July 2011 period Turkey was the largest supplier of hot rolled wide strip to the EU. Other countries such as the Russian Federation and Ukraine have kept a strong presence in the EU flat product markets as well.

The latest import license information and first estimates for Q3 point towards a further YoY rise in imports but they are seen moderating compared with the Q2 level. Imports in the final quarter are seen moving sideways, which will result in total imports rising by 30% in 2011.

The outlook for 2012 is for a decrease of around 5% in third country imports. The weakening growth trend in demand and the likelihood of the Euro remaining below USD 1.4 for some time should be supportive to keeping imports at a reduced level.