Consumers urge opening, fine-tuning in EC steel safeguards review

European steel stockholders and distributors’ association EUROMETAL has urged European Trade Commissioner Valdis Dombrovskis to consider fair trade and open market principles in any revision of the European Union steel import safeguard measures, in order to protect steel consumers’ interests.

Pricing developments over the last 18 months, and port stock positions not cleared by customers at the end of each quarter, need to be taken into account in any review, Daniel Guinabert, managing director and Fernando Espada, president of EUROMETAL, said in a Jan. 29 letter to the Commissioner.

Analysis of these elements might help to assess whether measures taken to control imports are really achieving their target, according to the EUROMETAL officers.

The current safeguards system, which has governed imports into the EU since 2018, following an import surge, is due to expire on June 30, 2021 after three years in operation. Luxemburg-based EUROMETAL said it recognized that the EC introduced safeguards in response to the US imposition of Section 232 steel import tariffs in March 2018, which prompted trade flow deviation to other markets.

EUROMETAL argued nonetheless that an open market is in the interests of steel consumers, who have faced skyrocketing steel prices in Europe in the last few months as the market has recovered from the COVID-19 related slump in March-April 2020.

Supply fluctuations in a market where some mills have continued to limit capacity working levels following the slump, coupled with state stimulus that has boosted demand in some sectors, have led some EU steel prices, including hot-rolled coil, to hit 12-year highs in recent weeks.

While the recovery is good news, the price increases that have resulted in a protected market have generated market tensions and supply and demand imbalances, “both in terms of tension in the supply chain and in terms of pricing,” Guinabert and Espada wrote.

“We need the Commission to assist and care about the steel users and steel consuming industries. There will be no market for the steel production if there is not a market of consumers,” the EUROMETAL officers wrote. “There are thousands of small and medium size companies that look for free competition to defend their products and know-how. We are talking about employment in manufacturing across Europe, which depends very much on all these medium- and small-size companies. Let’s produce locally, let’s generate value in Europe.”

Steel distributors, service centers and traders supply some 80 million mt/year of products, accounting for more than 60% of steel and tubes supply to over 1 million end-users in EU manufacturing and construction-related sectors, according to EUROMETAL.

— Diana Kinch