Supported by over 330 signatories across the EU’s steel value chain, steel distribution association EUROMETAL issued a “call-to-action” to safeguard Europe’s steel and metals value chain at a press conference on 14 April during the Tube & Wire trade fair in Düsseldorf.
Titled “Safeguarding the European steel and metals industry,” the briefing document will be sent to representatives of the EU’s national governments and the European Commission on 15 April, stressing the urgency of extending regulatory protections to the EU’s steel consuming industries.
Spearheaded by EUROMETAL, the campaign outlines a number of measures considered necessary to “safeguard and revitalise” European industry:
- a new trade regime “to follow up” the EU steel safeguard, effective across all CN codes under headings 73-95 and ready for implementation on 1 July;
- a similar extension of CBAM to steel derivatives and steel intensive products;
- “Made in EU” mandates across public procurement and funding schemes;
- “Cost-relief measures” that would limit industrial electricity prices to a maximum 5ct/KWh, slow the free allowance phase-out under the ETS/CBAM, and reduce EU-level and national bureaucracy (including the “suspension of additional regulations and corrections of existing rules”).
Speaking at the press conference, EUROMETAL President Alexander Julius described how recent and ongoing geopolitical developments necessitate a new regulatory reality, citing a “Trumpish” approach as the EU’s last chance to prevent further erosion of its industrial base to substitute steel derivative imports in undermining its national and social security.
EUROMETAL thus calls for a stark change in the Commission’s approach to trade regulations, seeing the EU’s strict – and increasingly solitary – adherence to the WTO framework as outdated in today’s geopolitical context. The European Commission did commit to a reduced threshold for trade defence investigations in last year’s Steel and Metals Action Plan, but market sources see little improvement in authorities’ trade reactivity, exemplified by the lack of progress on ongoing anti-dumping investigations, such as on cold-rolled coil.
While the WTO framework is something of a ‘boogeyman’ in today’s fraught global trade context, the European Commission has leveraged WTO instruments at pace in the past, implementing its original steel safeguard between May and July 2018 in reaction to President Trump’s original section 232 steel tariffs and displacement risks. Trilogue negotiations for the EU’s new steel protections were finalised this week, and the communications from EU’s various authorities commonly centralise the measure’s WTO compliance as an institutional success.
The European Commission has also introduced safeguard measures or investigations into ferroalloys and electrical steels in the last year, but has not indicated that downstream protection would be pursued via a safeguard instrument, instead assessing a possible extension of its new replacement steel trade measure in the coming years – a pace deemed far too slow by EUROMETAL and associated signatories.
Protectionist efforts from the US and Canadian steel markets were presented as a lead for the EU to follow – with both jurisdictions expanding existing or new steel steel trade measures to derivative products at relatively short notice to protect their domestic consuming industries from substitutive import pressure.
EUROMETAL highlights that the global intensification of steel trade barriers – with US tariff offensives as the catalyst – will see both steel and steel-containing goods deflected to the EU, compounding the stranglehold on European manufacturing, especially as upstream steel prices rise as a result of their own protection coverage.
Questioned by McCloskey on the form of the potential downstream tariffs, panel speakers advocated for a “holistic” approach, seeing an urgent need to establish protections as a baseline without a need to consider every technicality. Describing the steel value chain as at “5 minutes to midnight” – or even “5 past midnight” for sectors such as automotive – speakers consider industry as no longer able to deflect or absorb non-competitive pressures from outside EU borders – an existential threat.
According to the speakers, the steel industry – characterised as a “chain” by press conference speakers – risks collapsing entirely if allowed to break at a single point (steel-consuming industries), and so must be protected “holistically” as an absolute priority, without the “over-engineering” associated with EU bureaucracy.
EUROMETAL’s ‘call-to-action’ will be updated as new signatories join the campaign, with company profiles and interviews to come in the near-term, intended to better illustrate the specific burdens undermining – and ultimately eroding – the EU’s industrial competitiveness.
Author: Benjamin Steven
