EU safeguard extension debate heats up

The debate over the possible extension of safeguard measures beyond June 2021 is starting to heat up in Europe. This comes after 12 governments sent a letter to the European Commission formally requesting an investigation for a possible extension.

The letter, seen by Kallanish, was signed by the economy ministers of a number of European countries, including Germany, Italy, France, Spain and Belgium.

“While we are aware that steel safeguards might not solve the structural problems of the steel industry, they remain nonetheless a necessity for its survival, as the threats targeted by the safeguard measures have not disappeared,” the letter reads. “We therefore ask you to investigate extending the steel safeguards for the time and to the extent necessary.”

A source at a major steel importer expresses opposition to the letter’s content. “The biggest issue at the moment is that the European Commission will now have to decide quickly if they want to launch an investigation. If this happens, we will be again facing a lot of uncertainties because we will not be able to plan the supply of steel from June onwards,” the source observes.

“Planning imports is important for our activity and we need to do that in advance, which is impossible if a decision on the extension of safeguard is taken last minute,” the source adds.

Kallanish understands that, due to the investigation’s length, a decision on the safeguards could come only in May, weeks before the natural termination of the existing measures.

The next six months are set to be key for importers, processors and distributors of steel.