Eurofer has asked European leaders to take immediate action to support a steel sector recovery. This comes ahead of the European Council meeting taking place on Friday.
“You do not wait to extinguish a fire until the house has burned down – and the European economy cannot wait until 2021 to start rebuilding either,” Eurofer director general Axel Eggert says in a note sent to Kallanish. “EU leaders must therefore consider additional, short-term, emergency measures for strongly impacted sectors, such as steel and its value chains.”
Eurofer wants measures put in place to make sure a potential surge in imports does not materialise. In addition, incentives to stimulate demand should also be implemented (see Kallanish passim).
“Actions should comprise immediate measures against dumping or sudden surges of steel imports, incentives to stimulate demand in the downstream value chain, and a force majeure clause for the EU Emissions Trading System to ensure that the level of free allocation post-2020 is not negatively impacted by the indirect effects of the COVID19 pandemic,” Eggert observes.
Eurofer calculates steel demand during the crisis has fallen by up to -50% given the sharp drop in activity in steel-using sectors, such as automotive, construction and mechanical engineering.
Production at European mills remains down by -25%, with orders impacted by nearly -35% since mid-March compared to the same period of 2019.
Eurofer once again criticised the safeguard system for steel in Europe, noting it “…is unlikely to ward off the threat of import surges once EU demand returns.”
“If the EU does not find a solution to preserve its industry using the means immediately at its disposal, it will not be able to lead the green transition in the future,” Eggert concludes.