Recently adopted new European tariff rate quotas (TRQs) will support the reduction of flat stainless imports into the EU. The immediate impact of the new EU quota allocation may be optically limited due to CBAM-driven reduction of imports in early 2026. New quotas will solidify the fundamental changes on stainless trade flow through lower levels of stainless imports into Europe and stronger support for domestic stainless prices. We estimate new quotas will impact exports of CRC from Taiwan (China) and Malaysia, as the volume of their current CRC exports to the EU, which exceeds the new quotas, represents 8% and 15% of their respective CRC production (2026).
If you want to learn more about our analysis of the new European stainless import quotas, CRU will be holding a webinar on 14 July 2026, covering the subject of EU quota allocation and reflecting on the implications for European trade flows.
New EU safeguard measures reshuffle the ranks of key exporters
The EU's regulators have published the detailed breakdown of the new tariff-rate quotas for stainless steel products, which took effect from 1 July 2026. The announced total EU quota allocation is split equally between Most Favoured Nation (MFN) suppliers and countries with Free Trade Agreements (FTA) with the EU.
Countries that have (or will have) an FTA with the EU, and held an import share of over 5% during 2022–2024, have been allocated individual quotas. The system divides each allocation into two equal MFN and FTA parts. FTA countries holding a country-specific quota may, once it is exhausted, access an additional "FTA Quota – CSQ" (Country Specific Quotas) pool on a first-come, first-served basis, competing with other FTA countries in the same position. Countries with free trade agreements, but without a country-specific quota, draw on the residual "FTA Quota – Other countries" pool.
Likewise, the MFN quota is divided into individual country quotas, based on each supplier's average import share during 2022–2024. Countries meeting the 5% import threshold were assigned individual MFN quotas, with the remaining suppliers grouped under a single shared quota. All MFN countries can use the residual "Other countries" MFN quota.
The new reduced CRC quotas will impact exports from Taiwan (China) the hardest
The EU's new quotas for stainless cold rolled coil (CRC) imports mark a sweeping contraction, cutting total EU quota allocation by around 53% from 1,064 kt to 496 kt.
South Korea retains its position as the largest single-origin quota holder, but even its allocation is nearly halved (−49%). The deepest cuts fall on Taiwan, China (−71%) and India (−69%), while the USA and Malaysia lose access entirely, reflecting low exports to the EU during 2022–2024. Conversely, China and Vietnam gain newly created allocations, alongside dedicated FTA quota pools.
As a result of the new EU quota allocation, several countries that hold an FTA with the EU and have sizable cold-rolled coil (CRC) exports – including South Korea, Turkey, South Africa, Vietnam and India – received both FTA and MFN quota allocations. However, countries without an FTA such as Taiwan (China) and China retain only the MFN part of the EU quota allocation.
Comparing the new CRC import quotas with estimated annual CRC imports for 2026 (based on actual imports during January–April 2026) reveals a clear split between origins facing binding constraints and those with headroom. Taiwan (China) is the most squeezed, with estimated imports of 123 kt against just 53 kt of allocated quota, followed by China (66 kt vs 40 kt) and Vietnam (54 kt vs 44 kt). South Korea sits almost perfectly balanced, leaving little headroom for CRC exports. In contrast, India and South Africa hold comfortable surplus quota, positioning them to potentially capture volumes displaced from the more constrained origins.
CRC exports from Taiwan (China) and Malaysia will be impacted the most
Our analysis indicates that the new EU quota allocation for CRC will affect CRC exports from Taiwan (China) and Malaysia the most. We estimate that CRC exports from Taiwan (China) will exceed the new quota by 70 kt. This volume represents 8% of Taiwanese (China) CRC production in 2026, according to the latest CRU Stainless Steel Flat Product Market Outlook – read more about the service here or directly request a demo here. Malaysia is likely to face a similar situation, with estimated CRC exports to the EU exceeding the quota by 15 kt, or 15% of 2026 CRC production. Other exporters with risks of exceeding their new CRC import quotas to EU in the next 12 months are China (26 kt) and Vietnam (10 kt), although these volumes represent 0.1% and 1.3% of Chinese and Vietnamese CRC annual production. South Africa and India will have extra room to grow their CRC exports to EU, although these volumes will be limited to under 15 kt each.
New EU quotas pose risk for HRC imports from South Africa and South Korea
The new quotas for stainless HRC imports were pre-announced and were reduced by 65% against previous quotas, as expected. However, unlike the previous quotas that only featured allocation for the UK, the new HRC quotas feature tariffs for individual countries. Similar to CRC quota allocation, some countries received both FTA and MFN quota allocations. Indonesia received the largest HRC quota (36 kt), comprised of FTA quota (21 kt) and MFN quota (15 kt). Other individual countries with individual HRC quotas that, together with Indonesia, account for 84% of the total HRC quota include India (26 kt), South Korea (21 kt), Taiwan, China (20 kt), Turkey (14 kt) and South Africa (12 kt).
The new HRC quotas came close to existing levels of HRC imports, based on actual data during the first four months of 2026. Most major HRC exporting countries will have HRC import quotas, which are close to the current levels of HRC exports to the EU. The only exception is South Africa, with strong export volumes in the first four months of 2026 (21 kt, +320% y/y).
Formally, South Africa emerged as the most exposed HRC exporter, holding just 12 kt of new quota against 63 kt of estimated 2026 imports. We noticed a spike in HRC imports from South Africa, up 475% y/y for the first four months of 2026. During 2022–2024, South Africa exported 19 kt of HRC to the EU, making any adjustment to the new tariff less significant. South Korea will be impacted too, with imports of 30 kt outpacing the new HRC quota of 21 kt. By contrast, Indonesia and Turkey carry ample allocations yet minimal current shipments, signalling significant unused headroom, while India and China remain finely balanced.
Chinese PMP exports to be the most impacted by new quotas
The new EU safeguard quotas for PMP represent a material realignment of import access across virtually all origins. China bears the most pronounced reduction in absolute terms, contracting 81% from 19.7 kt to 3.7 kt, while Taiwan (China) and the UK are excluded entirely, relinquishing their prior EU quota allocations of 3.2 kt and 3.5 kt, respectively. India stands out as the most resilient key supplier, moderating just 28% while retaining the largest revised quota at ~6 kt. South Africa (-66%) and "Other countries" (-74%) face comparably steep curtailments. Concurrently, Korea secures a new 2.1 kt allocation, and two newly established FTA quotas (CSQ and Other countries) collectively add ~2.2 kt, reshaping the competitive dynamics.
On comparing the new quota allocation with the estimated imports of PMP for 2026, China and India seem to be the most exposed, each holding just 6 kt and 4 kt of quota, respectively, against an estimated 15 kt of imports, leaving both materially constrained. South Africa is similarly tight, with 12 kt of imports against only 2 kt of quota. South Korea, by contrast, carries a modest 2 kt allocation with negligible shipments currently.
For readers interested in analysis of how the recent regulatory actions influence global stainless trade, request a demo here. If you want to hear more about our work on regulations in the stainless market, you can also get in touch with us – we’ll be happy to answer your questions.
