Market evolution: Hot rolled steel coil heavy gauge (CN 720837) — 2015–2025

Introduction

This report analyses the evolution of the European Union's external trade in heavy-gauge hot-rolled steel coils (Combined Nomenclature code 720837) over the period 2015-2025. The data reveals a fundamental shift in the EU's market position for this key industrial product. Over the decade, the EU transitioned from being a significant net importer with a substantial domestic production base to a market characterised by a rapidly growing import dependency, a collapsing export profile, and a shrinking domestic production footprint. The primary dynamics are a surge in import volumes from specific partner countries, a parallel decline in EU exports, and a consequent sharp deterioration in the trade balance, raising concerns about strategic autonomy.

1. The Import Surge: Volume Growth and a Shifting Supply Map

EU imports of product 720837 underwent a substantial and sustained increase over the period, fundamentally altering the supply landscape.

1.1. Aggregate Import Growth Outpaces Exports

The total value of EU imports increased by 144.3% from 2015 to 2025, reaching nearly €1 billion in the final year. Import quantities grew by 75.3% over the same period, from 1.03 million tonnes to 1.81 million tonnes. This growth in imports occurred alongside a steep decline in EU exports (value -36.8%, quantity -62.7%), causing the trade deficit to balloon from -€210 million to -€873 million (trade overview).

1.2. The Dominance of Türkiye and the Retreat of Russia

The sourcing of EU imports became more concentrated and underwent a dramatic geographical shift. Türkiye emerged as the overwhelmingly dominant supplier, increasing its share from €30 million in 2015 to €265 million in 2025 (+774.5%). Conversely, imports from the Russian Federation collapsed from €76 million to just over €1 million (-98.5%), largely reflecting the impact of geopolitical sanctions post-2022. Other key suppliers like India (+220.3%) and the Republic of Korea (+284.7%) also saw significant growth, though from lower bases. Japan and Taiwan became notable suppliers only from 2021 onwards (top partners).

1.3. Volatility and Price Spikes Reflect Market Stress

The import market exhibited high volatility, with several partner relationships showing a coefficient of variation (CV) exceeding 0.5, indicating significant year-to-year fluctuations. The most extreme volatility was observed with Japan (CV 1.01) and Indonesia (CV 1.32). The data also identifies major price shocks in 2021 for imports from Ukraine (+103.1%) and Japan (+83.4%), coinciding with the global post-pandemic steel price rally and supply chain disruptions (volatility).

2. The Export Collapse and Eroding Competitive Position

While imports surged, the EU's ability to export this steel grade deteriorated markedly, pointing to a loss of competitiveness in international markets.

2.1. A Broad-Based Decline Across Key Destinations

EU exports of CN 720837 fell from €199 million in 2015 to €126 million in 2025. The decline was widespread across major traditional markets. Exports to Türkiye, once the largest destination, fell by 77.9%. Shipments to the United States (-79.4%), Mexico (-66.6%), Algeria (-99.1%), and Serbia (-96.4%) also collapsed. Only exports to the United Kingdom showed resilience, growing by 53.0% to become the EU's primary export market by 2025 (top partners).

2.2. Extreme Concentration in Export Destinations

The EU's export market became highly concentrated, as measured by the Herfindahl-Hirschman Index (HHI). The export HHI for value soared from 2,290 in 2015 to 5,555 in 2025, an increase of 142.6%. This level indicates a highly concentrated market structure, with the UK becoming a critical single point of dependency for the remaining EU exports (concentration).

2.3. Internal Shifts: Production Decline and Specialisation

The decline in exports is linked to a broader contraction in EU industrial capacity. Reported EU production of this steel grade fell by 23.0% in volume over the period. Furthermore, specialisation analysis (RSCA) for 2025 shows that only Slovakia, Finland, Belgium, France, and Germany have a positive revealed comparative advantage in this product. Many member states, including Ireland, Denmark, and Estonia, have virtually no production or export specialisation, indicating a hollowing out of the industry across the bloc (specialisation).

3. Structural Shift: Towards Heightened Dependency and Reduced Autonomy

The combined effect of rising imports and falling exports has fundamentally altered the EU's strategic position for this critical raw material.

3.1. Net Import Reliance Doubles

The most telling indicator of this shift is the net import reliance ratio. It grew from 16.9% in 2015 to 26.0% in 2025, an increase of 53.8%. This means the EU became substantially more dependent on external suppliers to meet its domestic consumption needs. The ratio hit a peak of 26.0% in 2025, the highest in the period, and was negative (indicating self-sufficiency) only briefly in 2017-2018 (net import reliance).

3.2. Export Propensity Collapses

Concurrently, the EU's export propensity—its ability to sell a share of domestic production abroad—plummeted. It fell from 12.9% in 2015 to just 7.5% in 2025 (-42.2%). This metric is identified as the most salient vulnerability indicator, scoring 84.7 on a salience scale versus 16.2 for trade intensity. The drop confirms that the EU industry is increasingly oriented inwards and losing its foothold in global markets (export propensity).

3.3. A More Vulnerable Market Structure

The import side also shows a slight increase in concentration (HHI from 1,265 to 1,462). While still considered a moderately concentrated market, the combination of higher import reliance, a more concentrated supplier base (with Türkiye's dominance), and a shrinking, less competitive domestic production base creates a more vulnerable market structure for the EU.

Conclusion

Over the 2015–2025 period, the EU market for heavy-gauge hot-rolled steel coils underwent a profound transformation. The decade was characterised by a strong import-driven growth dynamic, with volumes rising over 75%, spearheaded by Türkiye, while a simultaneous collapse in export performance saw volumes fall by over 60%. This twin trend led to a dramatic deterioration in the trade balance and a near-doubling of the EU's net import reliance to 26%.

The causes are interlinked: declining domestic production capacity (down 23% by volume) eroded the export base, while strong internal demand and competitive foreign supply filled the gap. Geopolitical shocks, particularly the sanctions on Russia, reshaped supply chains, further consolidating imports from a few key partners like Türkiye. The result is an EU steel sector for this product that is significantly more open, less globally competitive, and more dependent on external sources—a structural shift with clear implications for industrial resilience and strategic autonomy.