Proposed EU steel import safeguard measures revealed?

The European Commission has opened a week-long consultation on revisions to its steel import safeguard measures after publishing details of its proposed changes.

A draft document submitted to the WTO yesterday (March 11) shows that the application of new individual volume caps to the “other countries” quotas for various steel products are among changes to be applied from April 1. From July 1, the Commission proposes that the annual liberalisation of the overall tariff-rate quotas (TRQs) will also be reduced from 1%, to 0.1%. Furthermore, the redistribution of Russia and Belarus quotas will be wholly or partially reversed – reducing individual quota volumes.

The proposed changes published this week fall short of the 50% reduction to flat product quota volumes previously requested by Eurofer. However, MEPS International steel market analyst Jon Carruthers-Green acknowledged that they would present challenges for importers.

“Increased exports from Asia and reduced opportunities to export to the US mean that it's a tough time for European steelmakers,” he said.?

“By restricting access to residual quotas and reversing sanction reallocations, policymakers are prioritising domestic producers, but risk squeezing supply chains and driving up costs for end-users.”

Reduced quotas, new usage caps

The Commission’s proposed reversal of the redistribution of Russia and Belarus volumes – a measure implemented in response to the war in Ukraine – will reduce the duty-free hot rolled coil quota by around 12%, to 1.9 million tonnes per quarter.

Changes to the “other countries” quarterly quotas will include a reduction in the individual countries’ cap on the use of the hot rolled coil quota from 15% to 13%. The other new quota caps for quarter two, 2025, are detailed below:

13% - Non Alloy and Other Alloy Hot Rolled Sheets and Strips - 1A (111,380 tonnes); Non Alloy and Other Alloy Cold Rolled Sheets (43,468 tonnes)

15% - wire rod (15,075 tonnes); angles, shapes and sections?(10,122 tonnes)

20% - 4B galvanised coil (20,956 tonnes); quarto plate (1,048 tonnes); rebar (27,568 tonnes); tin mill products (7,421 tonnes)

25% - 4A hot dipped galvanised coil (118,762 tyonnes); organic coated sheets (10,715 tonnes); stainless bars and sections?(1,287 tonnes)

30% - electrical sheets 2,588 tonnes); gas pipes (3,332 tonnes); hollow sections (5,560 tonnes); large welded tubes (1,948 tonnes); other welded tubes?(6,015 tonnes)

Under the Commission’s draft measures, exporting nations with a country-specific quota will have access to residual quota volumes in the final quarter of the measures' year (April-June) removed for hot rolled, cold rolled and 4A hot dipped galvanised coil. Importers will retain access to 30% of?the 4B hot dipped galvanised coil residual volumes, however.

Carruthers-Green said: “The new allocations within the ‘other countries’ residual quotas are particularly targeted against countries who now export more to the region than they did when safeguards were first introduced. For example, in the year prior to their introduction Vietnam exported 290,000 tonnes of finished steel into the EU, by 2024 this increased nearly ten-fold to 2.65 million tonnes.”

The European Commission said that its decision to reduce the liberalisation rate applied to its TRQs was based on the EU’s reduced steel consumption. It said that liberalisation had resulted in a near-25% increase to TRQs since the safeguard measures’ introduction, adding that EU steel demand has declined by 14% over the same period.

Consultation is now open on the Commission’s proposed measures. It is seeking feedback from those with a “substantial interest as exporters” by March 18.

Protecting the world’s ‘most vulnerable market’

Today (March 12), the US government reinstated its 25% US Section 232 import tariffs to steel imports from all exporting nations, eliminating all previously agreed free-trade agreements, TRQs and exemptions agreed with key trade partners.?

Eurofer continued its calls for “robust” changes to the EU safeguard measures to protect the EU steel industry from the threat of redirected shipments of low-cost steel from Asia.

“Simply put, while all other countries – today, the US – protect their national steel production, the EU has had the most vulnerable market in the world”, said Eurofer president Dr Henrik Adam. “Our producers already face the highest energy prices while having the highest climate ambition. Meanwhile, they are being undercut by cheaper, more carbon intensive foreign imports.”

He added: "It is crucial that the revised steel EU safeguard measures are robust and effective to respond immediately and decisively to counter further deflection of steel imports flooding the EU market. The time has come.”