'More than 1.5 million tons of steel will be missing every year in EU'

Assofermet, the Italian trade association for steel, metals, scrap, and hardware, strongly criticizes the EU Commission's decision to extend safeguard measures on steel imports, particularly from Vietnam, Japan, Taiwan, and Egypt. The European Commission recently notified the World Trade Organization (WTO) of its intention to extend these measures for another 24 months. The initiative involves imposing quotas on steel imports from these specific countries, aiming to protect European steel producers from a surge of imports.

According to Assofermet, this would lead to a shortage of 1.63 million tons of steel, an 'unprecedented threat to the competitiveness of steel-using companies'.

'Potential catastrophic repercussions for European steel-consuming sectors'

"A shortage of these steel volumes would have catastrophic repercussions on lots of traditionally steel-devouring sectors: automotive, construction, mechanical engineering, and all European manufacturing using this raw material. European companies would lose further competitiveness after already experiencing years of severe restrictions on steel imports," they warn.

The EU Commission's proposed safeguard extension includes a drastic 15% cap on imports of a specific steel product (HRC- Hot Rolled Coils) from key supplier countries like Vietnam, Japan, Taiwan, and Egypt. These countries collectively exported nearly 3.9 million tons of HRC to the EU in 2023. Assofermet, analyzing this data, projects a significant drop in imports under the new quota system. Their forecast suggests a maximum annual import of 2.26 million tons from these countries in 2024, resulting in a crippling shortage of 1.63 million tons. This shortfall would severely disrupt the entire European manufacturing sector, already facing a consumption crisis. Furthermore, these specific steel grades are not readily available within the EU, making imports essential.

Double whammy: safeguard and CBAM

Compounding the issue is the overlap with the Carbon Border Adjustment Mechanism (CBAM). This additional measure aims to reduce carbon emissions associated with imported steel, but it's also likely to increase steel costs for European companies. If no changes are made, both the safeguard and CBAM will be in effect simultaneously for the first semester of 2026, potentially doubling the cost burden on European manufacturers.

'This is the worst scenario we could have expected from the extension of the Safeguard measures,” commented Paolo Sangoi, President of Assofermet Acciai. 'It is of paramount importance that the European Commission becomes a guarantor of the steel supplies that European manufacturers need. The success and future of our economic system are also guaranteed by the consumption generated precisely by the steel-using industry.'