Eurofer has welcomed the changes applied by the European Commission on the safeguard system for steel products. However, it notes they are still not sufficient “…for a large part of the sector, especially given that it is facing depressed domestic steel demand.”
From this week, the safeguard measures in place since the beginning of this year have become slightly more stringent. Further clauses have been included in the system, including a limit on hot rolled coil imported by a single country to remain below 30% of the available quotas.
“The largest part of the steel sector is still being squeezed, hampered by unsustainable import pressure – pressure that will not abate, despite the changes made today,” Eurofer director general Axel Eggert says in a note sent to Kallanish. “The steel sector is now back in choppy waters – demand is falling and imports are still at a very high level. We hope that the Commission will, in due course, further review the artificially high tariff free quota level and reduce it to close to the 2015-17 import volume.”
Looking forward, Eggert notes that the association welcomed the suggestion by the new Commission President Vor der Leyen to create a Carbon Border Adjustment. This would be to help industrial sectors re-establish a level playing field with foreign competitors that do not face the same climate cost constraints.
Global overcapacity is expected to remain an issue as well. “The G20’s Global Forum on Excess Steel Capacity must continue its work so that countries such as China, Indonesia, Iran, Russia, or Turkey stop building up excess capacity that endangers the global steel market. The safeguard alone will not be sufficient,” Eggert concludes.