Mexico said on Wednesday it is currently reviewing a CRC quota import deal signed with POSCO and Hyundai Hysco Co, as KIA Motors has just started up auto production at its Pesqueria plant in the state of Nuevo Leon and would then need to exceed the limit set by the Mexican government.
Mexico’s economy secretariat, SE, started an AD investigation in October 2012 over the imports of CRC from Korea. In June 2013, SE announced a provisional countervailing duty of 6.45 percent over CRC imports coming from Hyundai Hysco Co and 60.40 percent from POSCO and the rest of Korea.
Later in December 2013, both POSCO and Hyundai Hysco Co reached a CRC import deal, in which Hyundai Hysco limited its CRC exports to Mexico to the following annual quotas: 10,000 mt in 2014; 15,000 mt in 2015; 20,000 mt in 2016; 25,000 mt in 2017, and 30,000 mt in 2018.
POSCO committed itself to the following quotas: 400,000 mt in 2014; 450,000 mt in 2015; 480,000 mt in 2016; 500,000 mt in 2017, and 500,000 mt in 2018.
Both companies agreed to export the product at non-injurious prices. As a result of the deal, SE suspended the provisional AD duties previously established.
However, Hyundai Steel requested on December 21, 2015 that the Mexican government to review the quotas agreed by Hyundai Hysco, since a Hyundai-affiliated company, KIA Motors, decided to invest in Mexico and would then need to use a specific amount of CRC for automotive use.
Hyundai Steel said since it’s part of the Hyundai Motor Group it could require the review of the deal.
As a result of Hyundai Steel’s request, the Mexican government announced on Wednesday it will review the deal, while keeping the existing agreement. It established the period of the review from January 1, 2015 to December 31, 2015.