European Commission study reveals economic costs of US tariff escalation
The European Commission has released a detailed analysis on the global economic implications of the sharp US tariff increases adopted under the second Trump administration.
According to the study, these measures represent the largest rise in US import tariffs since the 1930s and carry significant consequences for both the United States and its trading partners, including the EU.
The report finds that US tariffs weaken the American economy rather than strengthen it. Higher import duties increase production costs—because US industry heavily depends on imported inputs—and reduce the purchasing power of households. As a result, US real GDP declines, inflation rises, and the Federal Reserve is forced to tighten monetary policy, further dampening domestic demand.
While tariffs are intended to shift demand from foreign to US-made goods, they also trigger a strong appreciation of the US terms-of-trade, making American exports less competitive and suppressing export volumes. The study concludes that only around one quarter of the tariff burden is actually paid by foreigners, with the majority falling on US firms and consumers.
For Europe, the macroeconomic impact is moderately negative, driven mainly by lower EU exports to the United States. At the same time, European producers gain market share in third countries, where US exporters lose competitiveness due to higher costs and a stronger dollar. The EU nonetheless faces a terms-of-trade loss, which reduces real income.
The analysis also warns that retaliatory tariff measures would deepen losses on both sides, while rising financial uncertainty in the US could amplify the negative effects well beyond the direct impact of tariffs.
Overall, the Commission’s findings confirm that tariff wars create instability across global value chains, with widespread implications for industrial sectors—such as steel distribution—that rely on predictable, rules-based trade.
European domestic HRC market largely quiet; sellers seek higher prices in Central Europe
In Northern Europe, mills’ targets remained in the range of €620-650 per tonne ex-works, with only one re-roller in the region heard offering coil around €600 per tonne ex-works.
Estimates of workable prices still ranged €610-620 per tonne ex-works, with no deals heard on the day.
As a result, Fastmarkets’ daily steel hot-rolled coil index domestic, exw Northern Europe moved marginally to €615.00 ($713.00) per tonne on Friday, down by just €0.17 per tonne from €615.17 per tonne on November 27.
The index was up by €2.92 per tonne week on week and by €12.95 per tonne month on month.
In Italy, January-delivery coils were available within the range of €600-620 per tonne ex-works, while workable prices were said to remain below €600 per tonne ex-works.
Fastmarkets’ daily steel hot-rolled coil index domestic, exw Italy was calculated at €602.50 per tonne on Friday, up by €0.42 per tonne from €602.08 per tonne on Thursday.
The index was up by just €0.62 per tonne week on week, but increased by €11.25 per tonne month on month.
In Central Europe, HRC — including material from the leading European supplier — was available at €640-645 CPT(around €630 ex-works) versus €620-630 per tonne CPT heard earlier in November, with some tonnages heard sold at the lower end of the range.
Successful closure of December order books by the key local supplier, the absence of pressure from import material — particularly from Indonesia — as well as the rise in regional pipe prices were cited by sources as some of the key reasons for the increase.
This information, however, emerged after the publication of Fastmarkets’ weekly price assessment for steel hot-rolled coil, domestic, exw Central Europe on Wednesday November 26, when it stood at €610-620 per tonne, unchanged from the week prior.
European CRC, HDG prices mostly flat, market sees more DDP CBAM-accounted offers
A distributor source told Fastmarkets that there was “no demand” in the market, adding that players are not looking to take risks until there is more clarity on new regulatory changes.
Meanwhile, a second distribution source said that consumption remains limited as players “await more clarity with CBAM”.
Northern Europe
Domestic prices for cold-rolled coil in Northern Europe rose slightly in the week to Wednesday, according to sources.
Estimations of workable levels were heard hovering €710-730 per tonne ex-works, compared to €700-720 per tonne ex-works during the previous week.
However, a deal was also reported at €710-720 per tonne ex-works.
Fastmarkets’ weekly price assessment for steel cold-rolled coil domestic, exw Northern Europe was €710-720 ($823-835) per tonne on Wednesday, narrowing upward from €700-720 per tonne a week earlier.
Meanwhile, domestic HDG prices were stable.
Estimations of workable levels were heard hovering €710-730 per tonne ex-works, the same as in the previous assessment period.
An offer was also reported at around €730-750 per tonne ex-works.
Fastmarkets’ weekly price assessment for steel hot-dipped galvanized coil domestic, exw Northern Europe was also €710-730 per tonne ex-works, unchanged week on week.
On the other hand, HDG and CRC import prices were also stable.
Fastmarkets’ weekly price assessment for steel cold-rolled coil import, cfr main port Northern Europe was €604-620 per tonne on Wednesday, unchanged week on week.
Fastmarkets’ weekly price assessment for steel hot-dipped galvanized coil import, cfr main port Northern Europe was also flat at €680-720 per tonne on Wednesday.
Southern Europe
Domestic CRC prices in Southern Europe increased in the week to Wednesday.
Estimations of workable levels were heard hovering €690-730 per tonne ex-works, compared to €690-720 per tonne heard in mid-November.
However, a deal was also reported at €710-720 per tonne ex-works.
Fastmarkets’ weekly price assessment for steel cold-rolled coil domestic, exw Southern Europe was €710-720 per tonne ex-works, narrowing upward from €690-720 per tonne in the previous week.
Meanwhile, domestic HDG prices also increased.
Estimates of workable levels were heard hovering €700-730 per tonne ex-works, compared with €695-720 per tonne in mid-November.
A deal was also reported at €730 per tonne ex-works.
Fastmarkets’ weekly price assessment for steel hot-dipped galvanized coil domestic, exw Southern Europe was €700-730 per tonne on Wednesday, rising from €695-720 per tonne in the previous week.
Meanwhile, CRC and HDG import prices were also stable.
Fastmarkets’ weekly price assessment for steel cold-rolled coil import, cfr main port Southern Europe was €600-620 per tonne on Wednesday, while the weekly price assessment for steel hot-dipped galvanized coil import, cfr main port Southern Europe was €670-700 per tonne on the same day, both unchanged week on week.
With the market seeking clarity with CBAM-related costs on imports, Fastmarkets has decided to launch a DDP import steel price assessment for flat steel products on Wednesday November 26.
The new DDP assessments for imported flat steel in Europe provides insight for market participants looking to navigate the trade landscape shaped by CBAM.
The assessments, which factor the effects of CBAM-related costs, aim to mirror how the spot market is likely to function from 2026 onward, reflecting underlying supply-and-demand dynamics. Therefore, CBAM certificate costs may not always be fully priced in or passed through in spot DDP transactions.
For this reason, the published prices do not incorporate any explicit, calculated CBAM certificate cost, which can change significantly across data submissions. Reasons for these changes include differences in brand and origin, the timing of customs clearance and applicable CBAM cost at that moment, and the share of carbon costs already covered in the country of origin.
Northern Europe
Fastmarkets’ weekly price assessment for steel cold-rolled coil import, ddp Northern Europe was €700-730 per tonne on Wednesday.
Offers were reported at around €700-730 per tonne DDP.
Fastmarkets’ weekly price assessment for steel hot-dipped galvanized coil import, ddp Northern Europe was €730-730 per tonne on Wednesday.
An offer was reported at €730 per tonne DDP.
Southern Europe
Fastmarkets’ weekly price assessment for steel cold-rolled coil import, ddp Southern Europe was €700-720 per tonne on Wednesday.
Estimations of workable levels were reported at €700-710 per tonne DDP.
An offer from South Korea was reported at €720 per tonne DDP.
Fastmarkets’ weekly price assessment for steel hot-dipped galvanized coil import, ddp Southern Europe was €720-730 per tonne on Wednesday.
Offers from Asia were reported at €720-730 per tonne DDP, with an offer from Vietnam reported at €720 per tonne DDP.
Redshaw: CBAM not only creates carbon costs, but also a new trade order
SteelOrbis talked to Louis Redshaw, founder and CEO of Redshaw Advisors Ltd., regarding EU’s safeguard policy and the effects of CBAM.
How do you evaluate the latest announcement from the EU regarding its safeguard policy?
The latest safeguard measures that the EU Commission proposed to protect EU steel production are designed to limit the impact of global overcapacity on EU producers and to increase traceability of imported steel. The measure is expected to have an inflationary impact on steel prices in the EU, thus a spillover effect on steel-intensive consumers. The plan’s “melt and pour” requirement is particularly relevant to any discussion of the EU Carbon Border Adjustment Mechanism (CBAM) since it enhances traceability. Traceability is at the heart of the EU CBAM because importers must now demonstrate imported steel’s associated carbon emissions impact. However, the safeguard policy, when combined with CBAM obligations, makes importer’s jobs significantly more administratively burdensome and risky.
Are these trade measures effective in ensuring a level playing field, or do they distort competition?
The EU’s new steel safeguard measures are specifically designed to create a more level playing field by protecting domestic producers against unfair trade impacts caused by global overcapacity, particularly from subsidised or distorted markets like China. As such opinions on competition distortion will vary based on perspective, it is clearly anti-competitive to restrict imports, but it is also anti-competitive to subsidise and dump goods in another market. Importers will see the safeguards as unfairly increasing their costs relative to their competitors, while EU producers will benefit from a market that isn’t being pushed below economically viable levels due to subsidised foreign production, so they will see it as completely fair. How effective the trade measures will be will only become clear over time, but from an objective perspective the measures are likely more justified than not.
What do you think the main challenges of CBAM are and what effects do you anticipate on trade flows?
CBAM currently suffers from information gaps that prevent importers from quantifying and locking-in their costs. Despite EU CBAM financial liability starting in 2026, this is a problem today for those companies that are seeking to lock in prices for 2026 deliveries. Principal amongst the uncertainties is the delayed publication of CBAM benchmarks which prevents companies from calculating their exposure to CBAM certificate liabilities, thus their costs. This has caused companies to change their approach to markets, for example by stockpiling affected goods in advance of the CBAM obligation that starts on January 1. Other companies are leaving themselves wide-open to the financial risk and some are putting off transactions altogether until they can get clarity.
The second biggest challenge is CBAM certificate price risk. The EU won’t make CBAM certificates, valid for 2026 imports, available for sale until February 2027, which on the face of things would make it impossible for importers to risk-manage their costs. However, because CBAM certificate prices will be related to EU Allowance (EUA) prices companies can obtain a ‘dirty’ (i.e., imprecise) hedge by buying EUAs. With traders/importers surviving on thin margins, this may not be sufficient, so emerging risk-management products, such as the Virtual CBAM Certificate (VCC) have been launched to bridge that gap more accurately.
Given that CBAM introduces potentially substantial additional costs for less efficient producers, resource shuffling will occur, thus causing disruption to logistics at the producer’s end of the supply chain. As for trade flows, carbon-intensive products will be redirected to countries with no carbon tariffs and cleaner products will be largely re-directed to Europe. This effect will grow stronger over time as the CBAM phase-in makes carbon-intensive products less and less likely to arrive on European shores. Due to the phased-in nature of CBAM, it is difficult to predict exactly how much trade flows will change because that change will be gradual and the price of carbon in the EU can be very volatile. What is more certain is that demand from Europe will drop at least a little due to the higher costs of CBAM-covered goods in the EU.
Do you think current EU funding mechanisms are sufficient to support green transition in steel?
Under the Research Fund for Coal and Steel (RFCS), the steel sector is set to receive €100m for projects focused on breakthrough technologies, such as carbon capture, storage, and utilisation, process intensification, and CO2-neutral iron ore reduction. Additionally, the EU’s Clean Industrial Deal includes mobilisation of over €100 billion to support clean manufacturing broadly, including steel. The Innovation Fund, financed via sales of EU Allowances, is focused on first-of-a-kind technology deployment, and EU Allowance auction revenue can be put to work as state-aid on projects of any kind. So, there is, in theory, a lot of money available to support green steel, however it won’t all get spent on one sector.
A key consideration for the green steel transition is the cost of abating emissions in the steel sector, currently estimated at around €150 per tonne of carbon. The payback for green steel plants is unlikely until the carbon price (currently hovering around €80) approaches this figure. Current forecasts suggest that this threshold will be met in 2031. So, despite the available subsidies, we think that that transition will only happen in a meaningful way when a strong carbon price signal emerges, or costs of abatement fall.
How do you see the balance between environmental targets and global competitiveness?
Achieving emissions reductions relies on replacing blast furnaces with hydrogen- and electricity-based production. According to some analyses, roughly 20 percent of announced hydrogen projects (about 29 GW of capacity) across Europe have been stalled or cancelled, mainly because of economic viability challenges, funding shortages and uncertain demand for clean hydrogen. It is clear that decarbonisation is expensive and so, unless all other countries take climate change mitigation as seriously as Europe, global competitiveness will be severely distorted by playing-field levelling interventions by those governments seeking to address their carbon footprints.
EU CBAM is causing interesting developments in countries that are large exporters to Europe by pushing them to implement or strengthen their own carbon pricing mechanisms to maintain barrier-free market access to the EU. If implemented properly, these emerging carbon markets will naturally level the playing field in terms of carbon costs, reduce carbon leakage and de-risk green steel investments globally.
Lithuanian trader Vikant opens new steel warehouse in Ukraine
Lithuania-based steel trader Vikant has announced that it has inaugurated a new steel warehouse in Lutsk, marking the latest expansion of its distribution network across Ukraine.
The new warehouse strengthens Vikant’s regional presence, particularly in Western Ukraine, offering faster and more reliable supply of rolled steel products such as sheet steel, rebar, profiles, pipes and other metal products that the company trades.
With the new warehouse in Lutsk:
- availability of steel products for construction and industry in Western Ukraine will improve, reducing delivery times and possibly lowering logistics costs,
- customers from construction firms to manufacturers or distributors will gain easier access to a broad range of steel products and services,
- Vikant potentially strengthens its market reach at a time when demand for steel in rebuilding-related projects and infrastructure is significant.
India-EU coil prices drop amid CBAM benchmark leaks
Indian hot and cold rolled coil offers to Europe have fallen by $5-10/tonne on-week as market participants remain cautious following the leaked provisional CBAM benchmark values, and are awaiting further clarity, Kallanish learns from market participants.
Traders say the leak has added uncertainty that is tempering near-term buying. After India’s HRC quota was exhausted for the October-December period, some EU buyers are heard delaying January-March-quarter commitments.
As of Wednesday, Indian-origin HRC offers slipped by $5-10/t w-o-w to $560-565/t cfr Antwerp or Bilbao, or $500-505/t fob Mumbai, for S235 grade, end-December/early-January shipment.
South Korean offers to the EU were heard at around $626/t cfr Antwerp/Bilbao, while EU domestic mills were indicating at some €650/t ($752/t) base delivered for February/March, as per one EU buyer.
He notes “nobody is buying” in the current window, with CBAM uncertainty suppressing appetite. Selective import buying continues, but he sees upside risk to EU domestic prices in 2026 if supply tightens.
Kallanish analysis suggests Indian HRC exporters could face CBAM costs of around €222/t under the default approach or €72-170/t under the verified emissions route in 2026 (see Kallanish passim). This is a wide cost swing that is reshaping delivered competitiveness.
India’s HRC (category 1A) quota was confirmed exhausted as of 25 November, according to EU Taric data.
CRC offers fell by $5-15/t w-o-w to $710-715/t cfr Antwerp/Bilbao, or $650-655/t fob Mumbai, for DC01 grade.
EU domestic CRC levels are at around €760/t base delivered for February/March, with some importers estimating CBAM costs of €80-150/t, one source says.
EU Taric data show 75,349 tonnes of CRC fourth-quarter quota available out of 165,051t, and 7,716t awaiting allocation.
Indian plate offers declined $10-20/t to $680-690/t cfr Antwerp, or $620-630/t fob Mumbai. HDG slid $5-10/t to $770-780/t cfr Antwerp, or $710-720/t fob Mumbai for 1mm Z275/DX51 grade, with PPGI maintaining a $200/t premium.
Metal coated (category 4A) available quota was at 18,638t out of 54,280t, and 182t awaiting allocation. Metal coated (category 4B) was at 68,556t unutilised out of 99,930t, with 1,325t awaiting allocation. Organic coated (category 5) is fully exhausted.
In Vietnam, Indian-origin HRC offers decreased by $10-15/t to $485/t cfr Ho Chi Minh City, or $473/t fob Mumbai for 20% 2mm SAE1006 grade.
A Vietnamese source says competing-origin price movements have been modest, with the price decline reflecting weak downstream demand, opportunistic restocking and trade sensitivities that have reduced import flows.
Indian offers are now at close parity with Korea ($500-505/t cfr) and China ($460-510/t cfr), compressing pricing room.
In the GCC, Indian-origin HRC offers dipped slightly to $500/t cfr or $483/t fob Mumbai for S235JR, mid-December shipment. Freight remains at $15-20/t. The GCC remains a stable outlet for Indian mills, but softer regional activity and competitive Chinese pricing are influencing order flow.
Indian exporters thus face continued pressure in Asia amid weak demand and competitive alternatives, while contending with CBAM-driven delivered-cost adjustments into Europe in the near term.
Suhita Poddar India
Stegra receives additional EUR 37 million support for zero-emission steel plant
The Swedish Energy Agency has announced that Stegra has received approximately EUR 37 million in additional state aid from the Industrial Leap program for its planned fully integrated, zero-emission steel production facility in Boden.
Stegra had previously secured a EUR 100 million grant from the Industrial Leap program as part of the EUR 265 million Swedish support package approved by the European Commission under EU State Aid rules in September 2024 and partially financed through the Recovery and Resilience Facility. With the newly announced EUR 37 million in additional funding, the total amount of public support allocated to the project has increased significantly.
Commenting on the development, Stegra CEO Henrik Henriksson stated: “We are grateful for the decision by the Swedish Energy Agency. This support enables us to strengthen the competitiveness of Sweden and Europe. There is still a gap within the limits approved by the EU, and we hope further steps will be taken to close this gap and ensure a more level playing field with other projects.”
The company’s project in Boden is regarded as an important step in accelerating Europe’s transition to fossil-free steel production.
Swedish steel giant Alleima AB has opened its new tube plant in China
Swedish steel producer Alleima AB has doubled its local production capacity by commissioning the second phase of its cold-working facility in Zhenjiang, Jiangsu Province, eastern China.
The company aims to shorten delivery times for its Asian customers and supply high-quality tube products with the new facility.
The expanded 12,500-square-meter plant was built with an investment of 193 million yuan (approximately USD 27.2 million). It will produce high-performance tubular products serving sectors such as petrochemicals, hydrogen energy, pulp and paper, and healthcare—including high-temperature and hydrogen refueling tubes that were previously imported.
The new plant is powered by solar energy, and the company uses more than 80% recycled steel. Alleima AB targets a 50% reduction in CO₂ emissions by 2030 compared to 2019 levels.
Carl von Schantz, President of Alleima AB’s Tube Division, said: “Over the past seven years, we have seen impressive development in the Asia region, with strong revenue growth in the chemical and petrochemical segment.” The company’s President and CEO, Goran Bjorkman, emphasized that the capacity expansion and wider product portfolio strengthen their ability to supply products locally in Asia and aim to serve China’s strong and growing market.
Europe steel market in the final week of november: Weak demand, tighter quotas and stabilizing prices
As the final week of November unfolds, the European steel market maintains a cautious stability shaped by persistent uncertainties. The absorption of CBAM’s provisional values, rising import-related costs and buyers’ hesitation ahead of the 2026 obligations continue to keep both domestic and imported steel prices within a narrow, sideways band.
HRC Market Holds Steady as CBAM Uncertainty Drives Spot Purchasing
Hot-rolled coil (HRC) prices across Europe’s flat steel market remained largely stable despite the pressure created by provisional CBAM values. Buyers, still waiting for clarity on the emission obligations that will come into force in 2026, continue to avoid long-term bookings and opt instead for short-term, hand-to-mouth purchases.
In this context, January-delivery HRC in Germany is reported in the €610–620/t EXW range, while Italian mills are transacting at €590–600/t. DDP offers for January 2026 deliveries into Italy are expected to fall between €570–600/t. These figures indicate that the week is closing with prices virtually unchanged.
On the import side, HRC prices remain relatively steady; however, tighter quotas and rising CO₂-related charges are preventing imported material from exerting any meaningful downward pressure on EU domestic prices. As a result, the European market is not experiencing the typical price-softening effect usually generated by imports.
EU Steel Production Declines Amid Weak Demand and Regulatory Pressure
Latest figures from the World Steel Association show that the downward trend in European steel production has continued. Crude steel output in the EU fell by 3.5% year on year in October to 10.8 million mt. Total production for January–October reached 107.8 million mt, marking a 3.4% decline compared with the same period last year. This underscores the dual challenge faced by European mills: muted demand and increasing regulatory burdens.
Behind this broader picture lie shifting production strategies. In regions where demand and industrial activity are concentrated, press and tooling manufacturers are exploring geographic diversification to manage cost inflation, with some evaluating options outside the EU. On the demand side, the slowdown in automotive and white goods production—combined with the transitional impacts of CBAM—suggests that final consumption trends are being shaped primarily by short-term market conditions.
Türkiye–Europe Steel Relations Strengthen Further
As November draws to a close, Türkiye’s commercial ties with Europe show renewed momentum, particularly in steel.
Turkish companies continue to secure significant positions in key EU infrastructure projects. Erciyas Steel Pipe recently won a supply contract worth approximately EUR 7.86 million for a 42-km section of a natural gas transmission project in Romania—an important development for the region’s pipeline segment. Meanwhile, British Steel has signed a GBP 35 million contract to supply material for Türkiye’s high-speed rail network, strengthening the mutual industrial linkage between the two markets.
Moderate Fluctuation in Long Products and Profiles
Prices in Europe’s long products and steel profiles segment ended the week with modest fluctuations. German IPN offers from Peiner and Thüringen were reported between €710–730/t EXW, while Spain-based Celsa’s offers into Germany stood in a similar range. In Italy, Duferdofin’s IPN sales were transacted at €700–705/t. Market participants note that most deals were concluded €10–15 below headline list prices. Even so, the broader European profile market continues to trade around €700–740/t CPT.
In rebar, Germany maintained EXW levels at €580/t and CPT at €590–600/t. In Spain, prices stood at €640–645/t CPT and €620–630/t EXW. Overall, the long products market reflects a pattern of controlled stability rather than any pronounced downward trend.
A similar picture is visible in the HDG and CRC segments. German HDG hovered at €710–730/t EXW, with CRC quoted at €700–720/t. In Italy, CRC remained in the €695–715/t band, while HDG stood between €715–720/t. These figures point to a week marked by narrow-band movements and limited volatility.
ArcelorMittal Poland permanently shuts down production at Huta Królewska
ArcelorMittal Poland has announced that production at the Huta Królewska steelworks in Chorzów will be permanently shut down, with all installations scheduled to come offline by the end of December this year. The company is preparing solutions to support the 270 employees currently working at the site, prioritizing job transfers within the group.
According to Marek Kempa, managing director of the long products division, the plant accounts for less than one percent of ArcelorMittal Poland’s total output. He noted that the age of the installations makes ensuring safe operations increasingly difficult, requiring major capital expenditure that cannot be justified in the current European steel market environment.
Before reaching this decision, the company made extensive efforts to sustain operations at Huta Królewska. Over recent years, ArcelorMittal Poland invested PLN 30 million ($8.21 million) in projects designed to expand the product range and improve quality. These included a new scale breaker, rolling stand modernization, a rail marking machine, and a new measurement and control block for rail production. The company also sought a strategic investor and explored joint venture options, though without success.
“This was a very difficult decision, given the long tradition and history of Huta Królewska,” said Wojciech Koszuta, president of the management board and CEO of ArcelorMittal Poland. He emphasized the company’s appreciation for the employees’ dedication and confirmed that everyone wishing to remain within the ArcelorMittal Poland structure will be offered opportunities.