Eurofer decries EU delay on Russian steel sanctions

Prolonged delays in enforcing EU sanctions on Russian steel semis contributes to unfair competition and would serve to empower President Vladimir Putin’s military actions in Ukraine, the European Steel Association (Eurofer) said on Friday.

Eurofer urges the EU Council to reject exemption requests from some member states aiming to protect the interests of a few steel rerollers profiting from Russian steel imports. The association emphasizes that the import of cheap Russian steel contributes to Russia’s military capabilities and conflicts with the objectives of EU sanctions, Kallanish notes.

Any additional exemptions for Russian steel imports must be firmly rejected by EU member states, as weakening the existing sanctions against Russia would be not only counterproductive but also a significant historical mistake, accoring to Axel Eggert, director general of Eurofer.

“The opportunistic interest of a handful of steel processing enterprises in the EU is undermining the overall objective of EU sanctions against Russia, where steel plays a strategic role not only in the overall Russian economy but directly in the Russian military machine engaged in the unlawful war against Ukraine. The EU member states should not perpetuate such a perverse system by approving another exemption, having already accepted a two-year delay in banning the import of Russian semifinished steel products into the EU,” Eggert said.

Failure to enforce steel sanctions against Russian semifinished steel leads to unfair competition and creates an imbalanced landscape within the EU’s domestic steel market, Eurofer contends.

The European integrated steel industry, performing its complete production process within Europe, is dedicated to optimising industrial, economic, environmental and social value creation within the EU. This stands in contrast to certain European rerollers who rely on leveraging cost benefits obtained from low-cost imports sourced from Russia. Additionally, integrated steel producers in the EU have swiftly complied with EU sanctions by halting the import of Russian coal.

The import quota for Russian slab, allowed by the EU’s eight sanctions package and totalling 3.74 million tonnes, is to expire in October 2024. Russian billet was assigned a quota of 85,260t in October-December 2023 and 48,720t in January-March 2024. Additionally, steel products processed in third countries using steel originating from Russia are not permitted in Europe as of 30 September 2023.

At the same time, EU importers did not exhaust the first-year quota for Russia-origin slab imports permitted by the bloc’s eighth sanctions package effective October 2022. EU imports of this product reached 2.89mt between October 2022 and September 2023, versus the quota of 3.748mt.

The EU’s 12th sanctions package against Russia is under discussion and may propose new restrictions on Russian pig iron, copper wire, aluminium wire, foil, tube and pipe, alongside other commodities, according to reports.

The Czech Republic is advocating for an extended exemption period for importing steel from Russian steelmaker NLMK.

Elina Virchenko UAE