In response to an ongoing crisis threatening the EU steel industry, the European Commission recently initiated a review of steel safeguards on imports. The move followed a request by 13 member states within the European Union.
“The request is based on the challenging situation facing the EU steel sector, which has been exacerbated by an increase of global overcapacity, together with a continued decrease in EU demand for steel,” the EC’s Directorate General for Trade said in a December 17 statement.
“The objective of the safeguard is to provide temporary relief to domestic industry, helping it to adapt to new market conditions and regain competitiveness,” the directorate added. The Directorate General for Trade, or DGT, is a section of the EC, which itself functions as the European Union’s executive arm.
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Investigation Will Run Through Q1 2025
The DGT stated that the EC is due to carry out its investigation until March 31 and, if it considers it necessary, will propose changes to EU member state policies. That said, approval for any changes will require a majority vote to take effect.
“Any decision resulting from this proceeding may become applicable as of April 1, 2025. This new review investigation will not impact the duration of the measure, which will remain in force until June 30, 2026,” the DGT added.
Imports exceeding a country’s quota currently stipulate a 25% tariff. The measures cover non-alloyed hot and cold rolled coil, plates and coated flats as well as stainless hot and cold rolled coil. It also covers rebars, merchant bars and railroad materials as well as seamless and welded pipe products.
Also subject to the measures are non-alloyed hollow sections, stainless bar products and seamless stainless tube and pipe products.
The EU Steel Industry Continues to Promote Protective Policies
The original safeguard measures were implemented in July 2018. As noted by the EC, their primary purpose was to protect against “an unforeseen, sharp and sudden increase of imports.”
More specifically, “the measure aimed to prevent economic damage for EU steel producers, given the risk of further import increases linked, inter alia, to the introduction of trade restrictions by the US on steel products (US Section 232 measure).”
The policy was extended back in June for an additional two years, after which it will expire. This is because it will have reached the maximum eight years permitted under EU and World Trade Organization rules.
Western European mills were seeking €615-625 ($645-655) per metric ton EXW for hot rolled coil in late December, an increase from the €600 ($630) sought in late November.
There were also reports that Turkish mills transacted material in the past week at €585 ($610) per metric ton CFR Europe. Meanwhile, one Indonesian mill moved material at €555 ($580) on the same basis.
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