EU steel industry calls for policy clarity amid weak demand, CBAM uncertainty
Market participants gathered in Luxembourg at the 75th Anniversary conference of European steel distributor association EUROMETAL July 3 voiced growing frustration with the pace and predictability of European steel policy.
As the region struggles with weak demand, rising regulatory burdens, and ongoing uncertainty around the Carbon Border Adjustment Mechanism, or CBAM, participants warned of over-regulation and inadequate protection for the downstream sector.
The mood at the conference was one of cautious realism, with calls for decisive EU action on trade defense and decarbonization targets amid volatile prices and geopolitical risks.
CBAM rollout raises concerns over cost visibility, compliance
While many agreed CBAM is structurally important to Europe’s climate ambitions, traders and distributors expressed concern over the current lack of clarity around emissions benchmarks, pass-through costs, and the long-term financial burden on supply chains.
“Right now, nobody can make estimates about how much margins they will make once CBAM kicks in,” a Germany-based distributor told Platts, part of S&P Global Commodity Insights, on the sidelines of the event. “It could vary by as much as Eur100/mt, which makes planning extremely difficult.”
Participants noted that downstream buyers, particularly in sectors like automotive and white goods, are asking for fixed prices but are unwilling to absorb potential CBAM-related volatility. Several speakers highlighted the danger of delivery slipovers into the first quarter of 2026 — when full CBAM cost implications are expected to materialize — forcing buyers to pay unexpected premiums.
Platts assessed Northwest European hot-rolled coil (HRC) at Eur555/mt ex-works Ruhr on July 3, and Southern European HRC at Eur540/mt ex-works Italy.
Distribution demands stronger role in policy
A Germany-based service center source warned that overregulation and indecision are damaging confidence in Europe’s ability to execute its climate and trade goals.
“Sometimes we just need a yes or no on the regulatory side,” he said. “CBAM doesn’t help in its current form, and 80%-90% of this industry is built on small and medium enterprises that can’t manage this uncertainty alone.”
Other distributors echoed this sentiment, arguing that while green steel presents real decarbonization potential, customer demand remains weak due to unclear value perception and the absence of downstream incentives.
“Increasing steel prices by 50% would only raise the price of a car by 0.6%, but reduce emissions by over 20%,” a buyer source told Platts on the sidelines. “Yet nobody’s paying a premium unless they see utility in the final product. The state needs to step in with tools like subsidies or green procurement rules.”
Participants noted that downstream buyers, particularly in sectors like automotive and white goods, are asking for fixed prices but are unwilling to absorb potential CBAM-related volatility. Several speakers highlighted the danger of delivery slipovers into Q1 2026 — when full CBAM cost implications are expected to materialize — forcing buyers to pay unexpected premiums.
Market players warned that existing safeguard mechanisms are inadequate to defend against underpriced imports.
“We need to move beyond crude safeguards,” another distributor told Platts. “We should start protecting semi-finished and downstream products that are 100% steel, like clutch plates.”
Many distributors are relying on large trading firms to calculate CBAM and landed costs for imports.
“We’re outsourcing the compliance burden, but it comes at a price. We need Delivered Duty Paid (DDP) prices that include the cost of CBAM,” the sources said.
Fragmented Europe, global competition
Luxembourg Prime Minister Xavier Bettel addressed the event, warning of growing global instability and Europe’s reliance on external partners.
“We rely on America for security and Russia for gas,” he said. “China’s oversupply is a major threat — and the EU must start acting more like a unified bloc.”
Several participants referenced Ilva and the failed sale to Liberty as an example of Europe’s fragmented approach.
“We don’t have strong regional champions,” the prime minister said. “We have too many mid-sized players trying to compete globally.”
European mills emphasized the need for a clear industrial policy to rival US support mechanisms.
“We export 90% of our scrap. The US has used policy to revitalize crude steel — we can do the same,” a mill source said. “CBAM should protect products made with EU steel, not just steel itself.”
Sentiment remains steady, but outlook clouded
Despite weak order intake and summer slowdown trends, most sources said current business levels were not catastrophic.
“Volumes are down 2%-3% from last year, but it’s not all bad,” the buyer source said. “The real issue is confidence and long-term visibility.”
A sense of realism pervaded the event, with broad consensus that if the EU wants to maintain its industrial base, it must back it with clear regulation, financial support, and pragmatic trade defense.
EU HRC prices inch lower amid import pressure, mixed outlooks
European hot-rolled coil prices inched down July 3 as further pressure from imports and mixed outlooks dampened sentiment within the market.
Many participants reiterated the subdued market conditions at the outset of the European summer holidays as the industry converged at the EUROMETAL 75th Anniversary conference in Luxembourg.
A distributor source said a favorable euro/US dollar exchange rate was making raw materials slightly cheaper for mills, giving them some relief in times where prices have fallen around Eur100/mt since the end of April.
A mill offer was reported in Northern Europe at Eur550/mt ex-works Ruhr, with tradable values in a range of Eur540-560/mt on the day, as sources at the event reiterated the wider conditions, and referred to the potential for lower prices to be attained for high tonnage enquiries.
In Southern Europe, market participants said activity was limited. An offer was reported at Eur545/mt ex-works Italy, with a tradable value being reported at Eur540/mt.
On the import side, prices fell further in both Northern and Southern Europe as offers from Turkey and Indonesia continued to get more competitive.
In Southern Europe, offers for Turkish HRC were reported at Eur500-505/mt CIF Italy duty paid, and for Indonesian material at Eur470/mt CIF Italy.
Indonesian material in Northern Europe was offered at Eur470-480/mt CIF Antwerp.
“Most people are stocking up on imports now,” a trader source said. “Indonesia and Saudi Arabia seem to be alternatives for now – people are always trying to find different sources for material not subject to safeguards,” he added.
Platts assessed imported HRC in Northern Europe at Eur480/mt CIF Antwerp, down Eur10 day over day, and in Southern Europe at Eur475/mt, down Eur15 day over day. Both prices assessed are at their lowest levels since 2021.
Platts assessed domestic HRC in Northern Europe at Eur555/mt ex-works Ruhr, down Eur5 day over day, the lowest level since December 2024. In Southern Europe, HRC was assessed at Eur540/mt, stable day over day and the lowest level since October 2024.
Platts is part of S&P Global Commodity Insights.
EUROMETAL: The future of the European Steel Distribution industry in 75th anniversary year
EUROMETAL, one of the most established and influential organizations in the European steel distribution sector, launched its 75th Anniversary conference in Luxembourg today. The event brought together industry representatives, industry leaders and politicians from across Europe to shine a light on the present and future of the steel industry.
Alexander Julius, President of EUROMETAL, opened the conference and stated that the 1990s was a golden era for the sector in terms of economic relations between China and Europe. At that time, China was importing steel products and sub-industry products from Europe as an emerging market, whereas today China has become a powerful producer worldwide and Europe is increasingly importing steel and products from China and other Asian countries. Julius emphasized that this transformation is a major challenge for the European industry and that Europe now needs to develop new strategies to remain competitive in terms of production and technology.
In his speech, he also drew attention to production declines in the European steel sector, overcapacity in global markets and unfair competition. In order to meet these challenges, Europe needs to develop a stronger trade policy, innovative solutions in energy policies and policies centered on sustainability.
The role of digitalization and green transformation
Carlo Thelen, Director General of the Luxembourg Chamber of Commerce, stated that digitalization and artificial intelligence will play a critical role in the European steel distribution sector. Artificial intelligence technologies will accelerate the sector in areas such as carbon footprint tracking, demand forecasting, logistics optimization and improving production processes. However, it was emphasized that many systems are still not integrated in the sector today and that digital transformation needs to be expanded.
Thelen added that the steel distribution sector needs to move to more agile, flexible and hybrid business models in order for Europe to achieve its green transformation goals. He emphasized that information management, logistics and environmental excellence should be prioritized in the sector as the boundaries between production, transformation, distribution and service are blurring.
Education, talent and industrial sovereignty
At the conference, it was stated that the technical and digital talent gap in Europe poses a serious threat. It was emphasized that for the sustainable development of the sector, it is necessary not only to train the new generation, but also to improve the skills of existing employees, support career transitions and long-term career planning. It was stated that Luxembourg Chamber of Commerce adapts its training programs according to sectoral needs.
In addition, it was stated that industrial sovereignty must be protected in order for European industry to remain strong and resilient in the face of global uncertainties, supply chain issues and competitive pressures. Europe needs to develop strategies to strengthen its industrial base through national and regional coordination.
EUROMETAL’s contribution to the industry and future vision
EUROMETAL has been a unifying and guiding force in the European steel distribution sector for 75 years. Over the years, the organization has been active in a wide range of sectors covering iron and steel service centers, stocking, trading and distribution, providing its members with information flow, connections and intra-sectoral cooperation.
At the conference, EUROMETAL’s 75-year journey from the past to the present was explained and how it has developed in parallel with Europe’s economic and political changes. This journey, which began in the 1950s with the reconstruction of post-war Europe, is now evolving into a new era of digitalization and green transformation.
EUROMETAL and industry representatives will continue to work together to build a sustainable, competitive and technologically leading steel distribution sector in Europe. The 75th anniversary celebrations were seen as a symbol of this unity and determination in the industry.
Antonio Marcegaglia: Europe risks trade isolation, prices nearing rebound
Flat steel prices are expected to reach their lowest point this summer before starting to recover in the fourth quarter. This will be driven by the European Commission’s safeguard measures review, existing quota systems, and the incoming Carbon Border Adjustment Mechanism (CBAM), according to Antonio Marcegaglia.
“Demand is structurally declining in Europe – by at least 15 million tonnes over the past six to eight years – reaching just 130 million tonnes last year,” Marcegaglia told Kallanish during EUROMETAL’s 75th Anniversary conference held in Luxembourg this week. This decline, he added, is occurring amid a broader global economic slowdown. “We must not underestimate the need to support European demand before talking about decarbonisation and trade”.
While producers have highlighted overcapacity and called for stronger border protections, Marcegaglia questions the actual extent of excess capacity in the global market. “Talking with my Chinese commercial partners I do see and I do expect a cut of 300 million tonnes capacity in the next five to eight years or even sooner, and [their] export-oriented model is no longer working,” he observed.
Marcegaglia acknowledges the need for Europe to shield its industry from unfair competition but highlights that protectionism alone cannot be the solution. “We need to protect to a certain extent but I do believe the EU, because of its nature as a re-exporting economy, needs to remain in the global supply chain actively working and not isolated,” he noted.
Referring to the ongoing global trade tensions created by US President Donald Trump, Marcegaglia conceded that chaos can work as a negotiation tool, but even the United States cannot afford to turn its back on global trade.
Europe has a structural competitive gap with Asian countries, created by high energy costs, lack of raw materials, the highest labour costs linked with being a developed economy and more developed social welfare. This gap will remain.
However, the European supply chain has a growingly sophisticated market that needs to be developed. It possess the best technologies for steel, a culture of innovation, scrap availability that is not yet fully utilised, a resilient, capillary and well-organised distribution supply chain, and social and political stability, Marcegaglia continued. If well managed, the green transition could become an opportunity.
Europe also boasts a proximity to markets in need of steel in the near future, such as the Middle East and Africa.
Marcegaglia is implementing a partial upstream integration with the acquisition of a stainless steel mill in Sheffield, UK, and the new Fos-sur-Mer hot strip mill project in the south of France. The company aims in future to reach zero debt, becoming less reliant on financial institutions, and post €10 billion ($11bn) in turnover and €1 billion in Ebitda. In 2024, the company registered €6.8 billion in revenue and €430 million in Ebitda.
Natalia Capra France
Alexander Julius: Industry must utilise political problem-solving momentum
EUROMETAL has begun collecting information from EU associations, national federations, and steel users regarding the import into the EU of low-priced steel derivatives. The association is analysing the growth in imports compared to the ongoing decline in European steel consumption and domestic production, president Alexander Julius said at the EUROMETAL 75th anniversary event attended by Kallanish.
Brussels and national governments are “opening their doors and they are listening”, he noted at the event in Luxembourg on Thursday. “We need to utilise this development and momentum, continuing to address the problems of our industry.”
Julius remains optimistic about the potential to establish a level playing field also for downstream companies in Europe. “Also to the European Commission, we have emphasised more than once that a green transformation, electrification and development of a European defence programme demand a healthy EU manufacturing industry with a healthy steel distribution,” he continued.
Collecting detailed information on unfair import practices related to steel derivatives is crucial, Julius added. He urged companies and industry associations to share as much data as possible as the European Commission can only act when properly informed.
Europe is becoming increasingly reliant on imports, particularly from China and other Asian countries, Julius warned. “China is now more digitalised and electrified than Europe,” he said, adding that Europeans have grown complacent, discussing reduced working hours and even four-day workweeks, as is the case in Germany.
He also highlighted growing geopolitical instability, citing US President Donald Trump’s “America First” stance, Russia’s ongoing war in Europe’s neighbourhood, and China’s strategic goal of becoming the world’s dominant supplier of hardware and software. These developments, Julius pointed out, should serve as a wake-up call for European policymakers and as an opportunity to rebuild a more independent and resilient Europe.
Meanwhile, Carlo Thelen, director general of the Luxembourg commerce chamber, urged Brussels to simplify the complex European regulatory framework and to develop pragmatic economic tools, stressing that businesses need greater clarity and predictability.
Speaking on the role of innovation, Thelen underlined the chamber’s mission to support companies in investing in technology. The potential of artificial intelligence may act as a key accelerator for steel distribution, provided it is accessible, reliable, and tailored to industrial needs. Applications such as predictive maintenance, carbon accounting, and forecasting could greatly enhance efficiency.
He called on the steel industry to prioritise technological innovation, noting that logistics, digitalisation, and AI are becoming the new industrial language. “Yet today, too many systems fail to communicate with each other,” Thelen said, warning that this lack of integration is hindering the sector’s progress in improving its environmental performance.
Natalia Capra France
