EU to reinstate rebalancing measures to combat renewed US Section 232 tariffs
Those rebalancing measures include a mirror 25% tariff on steel and aluminium imports from the US.
In addition, Brussels will impose further countermeasures on the US, targeting approximately €18 billion-worth ($19.6 billion) of goods, which will then apply together with the reimposed measures from 2018.
“The objective is to ensure that the total value of the EU measures corresponds to the increased value of trade affected by the new US tariffs,” a Commission press release read.
“Since the new US tariffs are significantly broader in scope and affect a significantly higher value of European trade, the Commission launched on March 12 a process to impose additional countermeasures on the US,” the Commission said.
The consultation process for additional countermeasures proposed the targeting of industrial products including steel and aluminium products, home appliances, household tools, plastics, wood products, and more.
The countermeasures were expected to enter into force by mid-April.
Trade background
On March 12, 2025, the US imposed 25% tariffs on imports of steel and aluminium products to include those from the EU.
The imposition of tariffs by the US was expected to lead to trade being diverted to new destinations, with steel products flooding toward markets including the EU, undermining local steelmakers and distorting competition.
“[US] President [Donald] Trump’s ‘America First’ policy threatens to be the final nail in the coffin of the European steel industry,” Dr Henrik Adam, president of European steel association Eurofer, said on March 12.
“If European steel disappears, so too does [the] European automotive [industry], European security and defense, energy infrastructure, transportation and others. What is at stake is European sovereignty,” he added.
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“Under the first Trump administration [in the US], we already witnessed the huge effect of Section 232. EU steel exports to the US decreased by more than 1 million tonnes, while of every three tonnes of steel deflected from the US market because of Section 232, two tonnes arrived in the EU,” he said.
“The US tariffs will probably lead to greater global trade imbalances, with steel that would have been shipped to the US going instead to European markets,” Adam said. “The EU was already contending with cheap steel imports – primarily from Asia, North Africa and the Middle East – and the US decision could exacerbate this situation, further damaging the European steel sector.”
The total amount of carbon steel imports to the EU in 2024 was more than 26.36 million tonnes, up by 6.4% compared with 24.78 million tonnes in 2023, Eurofer statistics showed.
At the same time, apparent steel consumption in the bloc amounted to 127 million tonnes in 2024, down by 2.3% from 130 million tonnes in 2023 and lower than during the 2020 pandemic year, when it was 129 million tonnes.
“EU steel production, which lost 9 million tonnes of capacity and 18,000 jobs in 2024 alone, is at even greater risk,” Eurofer said. “There is also the prospect that yet more steel will be deflected to the EU market if additional reciprocal tariffs are imposed by the US.”
Consequently, Eurofer has urged the European Commission to give an adequate response to the US measures to protect the struggling EU steel sector.
“It is crucial that the revised steel EU safeguard measures are robust and effective, to respond immediately and decisively to counter further deflection of the steel imports flooding the EU market. The time has come,” Adam said.
The EU’s existing steel safeguard measures have been extended several times, and were recently subject to a review, with proposed adjustments revealed on March 11. These adjusted measures were expected to come into force in April.
EU proposes further 3-year exemption from steel safeguard measures, anti-dumping duties for Ukraine
Ukraine’s exemption from EU safeguard measures, initially granted in June 2022 after the Russian invasion, has been renewed twice already – in June 2023 and June 2024.
Unlike previous extensions, the new exemption will apply for three more years and, if approved by the European Council and Parliament, will come into force on June 6.
The Commission said it is also “currently working on a longer-term solution [to] provide economic certainty and a stable framework for trade to both Ukraine and the EU.”
Europe is Ukraine’s largest trading partner, with significant steel exports to countries such as Poland, Bulgaria, Italy, Romania, Greece, and Moldova.
The news of the proposed extension comes amid an ongoing review of EU safeguard measures, which was announced on December 17, 2024 and is expected to conclude by March 31.
European Commission to postpone sales of CBAM certificates to 2027
One result is that steel importers will no longer be obliged to purchase CBAM certificates quarterly in 2026, as was planned originally.
The amendments were presented as part of the Clean Industrial Deal proposed by the European Commission on Wednesday. This was intended to serve as a framework to tailor action in Europe’s energy-intensive industries, including steel and metals, and the clean tech sector, to support decarbonization initiatives.
The official version of CBAM amendments complied with the changes, which were leaked into the public space earlier this week.
But the delay to the beginning of CBAM certificate sales will not remove the financial burden related to CO2 emissions, it will only shift it to the next year, Fastmarkets understands.
“The changes may relieve some immediate pressure, but the financial risk exposure stays the same,” Louis Redshaw, chief executive officer of Redshaw Advisors, said. “Companies will still be [liable] for 2026 emissions but won’t need to fully account for them until 2027. This delay doesn’t remove the financial burden, it just shifts when it [will become effective].”
Another change was the introduction of a new annual de minimis threshold to exempt small importers from the CBAM requirements. This meant that only companies importing more than 50 tonnes (or 100 tonnes of embedded CO2) of net mass of goods, covered by the legislation, will have to comply.
But representatives of the steel and metals industries commented that this change would make little difference because their shipment volumes were usually well above the threshold.
European steel association Eurofer also said that, although the proposed Clean Industrial Deal and the amendments in the CBAM have managed to identify the right problems, they offered only partial solutions.
The association expected that more measures would be included in the Steel and Metals Action Plan, which was expected to be announced on March 4 during the Strategic Dialogue on Steel, organized by the European Commission.
European Commission publishes Clean Industrial Deal, labels steel emissions
The European Commission has published its long-awaited Clean Industrial Deal. Besides the installation of 100 GW per year of renewable electricity till 2030 and over €100 billion ($105 billion) financing to support low-emission manufacturing, this will include a voluntary carbon intensity label for steel products starting from 2025.
The plan focuses on six core business drivers: affordable energy, lead markets, financing, circularity and access to materials, global markets and international partnerships, skills enhancement, and simplification, Kallanish notes.
The Affordable Energy Action Plan will lower energy costs, also tackling volatile prices by making Power Purchase Agreements more attractive for industrial users.
The EU will introduce sustainability, resilience and European preference criteria in EU public procurement for strategic sectors, aiming to reach 40% of domestically produced key components of clean tech products on the EU market.
The Industrial Decarbonisation Accelerator Act will develop a voluntary label on the carbon intensity of industrial products, while avoiding duplication, based on a simple methodology with ETS data and building on the CBAM methodology. The Commission will start with steel in 2025, based on existing reporting from industry. The labels “will allow industrial producers to distinguish the carbon intensity of their industrial production and to benefit from targeted incentives,” the Commission says.
The Commission will simplify state aid rules to give Member States more flexibility to support decarbonisation. An Industrial Decarbonisation Bank, aiming for €100 billion in funding, will be based on available funds in the Innovation Fund, additional revenue resulting from parts of the ETS as well as the revision of InvestEU.
It wants to ensure lower prices and higher availability for critical raw materials by organising joint purchases – through an EU Critical Raw Material Centre. It is also eyeing increasing the circular material use rate from 11.8% today to 24% by 2030.
The Circular Economy Act in 2026 will enable the free movement of circular products, secondary raw materials and waste. It will provide incentives to increase the use of metal scrap and mandatory digitalisation of demolition permits and pre-demolition audits.
The Commission also wants to give European companies better access to third markets and essential inputs via trade agreements and Clean Trade and Investment Partnerships, which will diversify sources of supply.
A new Union of Skills will meanwhile ensure a skilled workforce for strategic industries, promote quality jobs and support workers in transition.
Lastly but crucially, regulation will be simplified. The aim is to speed up permitting for industrial decarbonisation projects, simplify state aid rules by 2025 to accelerate clean energy roll-out and support industrial decarbonisation, and enhance coordination between EU and national policies to reduce red tape and leverage the scale of the Single Market.
“Today, Europe accelerates on its twin decarbonisation and reindustrialisation. This pact aims to position Europe as a world leader in clean industries – from boosting our production ‘made-in-Europe’, to beefing up regulatory and financial support to our most strategic industrial supply chains. It also secures our unique European model of setting decarbonisation not only as an environmental goal, but also as our economic growth strategy,” says Stéphane Séjourné, Executive Vice-President for Prosperity and Industrial Strategy.
Adam Smith Poland
European Commission schedules Steel Dialogue, reinforces strategic role
European Commission President Ursula von der Leyen will host a Strategic Dialogue on Steel on 4 March, Kallanish notes.
In a statement issued on Tuesday, the Commission reinforced that steel is a strategic sector, saying it plays a central role in the EU’s broader strategic autonomy.
The meeting is anticipated to bring together steel manufacturers, raw material suppliers, off-takers, and representatives of social partners and civil society. EUROMETAL will be represented by its president, Alexander Julius, the association says.
This comes ahead of the dedicated Steel and Metals Action, which Executive Vice-President Séjourné has been tasked with delivering in the spring. Feedback from the Steel Dialogue and related wider consultation will be fed into this dedicated plan.
“The steel industry is a key sector of our European single market. At the same time this industry is of utmost importance in our fight against climate change,” von der Leyen notes. “The Strategic Dialogue will help develop a concrete Action Plan to tackle the unique challenges of this sector in the clean industrial transition. We want to ensure that the European steel industry is both competitive and sustainable in the long-term.”
“Europe has a plan for its industry: we must produce more, we must produce clean, and we must produce European,” says Séjourné. “This starts with our most strategic sectors: steel is one of them. We must protect our steel sector from unfair foreign competition and boost our own production of clean European steel.”
Key Strategic Dialogue discussion points will include how to enhance competitiveness and circularity, drive the clean transition, decarbonisation, and electrification, ensure fair trade relations and an international level playing field. The Commission will inform and consult with the Council and European Parliament throughout the Dialogue process.
Proposals include the joint purchasing of raw materials on behalf of interested companies, which could ensure diversification of supplies, and a Circular Economy Act to incentivise the use of secondary scrap material in manufacturing. Also discussed will be the use of guarantees and risk reduction instruments to facilitate conclusion of long-term power purchase agreements, and to accelerate the uptake of hydrogen.
To speed up investment, the meeting will also discuss the creation of a dedicated financing mechanism for industrial decarbonisation based on the auctions-as-a-service model.
On the foreign trade front, global overcapacity is expected to reach 630 million tonnes in 2026. This means “it is essential to make more efficient use of anti-dumping or anti-subsidy duties to prevent that our market becomes an export destination for state-induced excess steel production,” the Commission says.
In addition, the safeguard measures for steel currently in place are set to expire by June 2026. The Commission will define a long-term solution to replace those measures in light of global non-market overcapacity, it concludes.
Adam Smith Poland
CBAM 2.0: Is the EU making compliance easier or just postponing the pain?
Changes have been proposed to Europe’s Carbon Border Adjustment Mechanism (CBAM) that would simplify some processes, and reduce its scope, Kallanish learns from an obtained leaked draft amendment.
While CBAM will still come into force in January 2026, the requirement to purchase certificates will be delayed and payment will be simplified. Certificates will now need to be purchased from February 2027 to cover the previous year, removing the obligation to purchase certifications on a quarterly basis for the first year.
Gabriel Rozenberg, chief executive of software company Cbamboo, says that while the definitive CBAM period will still start in 2026, there is an easing up in term of cash flow and bureaucracy.
Other changes proposed will see more companies now exempt from CBAM’s scope, with the thresholds at 50 tonnes/year or less than 100 t/y of embodied CO2 emissions of imported goods. This move is believed to remove around 90% of companies from the mechanism’s scope.
EU documents show that for the first year of CBAM’s transitional phase, which only required reporting, iron and steel accounted for 69% of overall tonnages reported across targeted sectors. Given the large tonnages handled by steel importers, the minimal threshold exemption is unlikely to benefit this sector.
“The European Commission is tightening the focus on the big emissions that CBAM is designed to tamp down on,” Rozenberg notes.
He adds that some sub processes and side processing of metals and goods that have minimal emissions associated with them are now out of scope.
This consists of finishing processes that are carried out by separate installations not covered by the EU Emissions Trading System (ETS). The embedded emissions of those production processes, which are relatively low, should be excluded from the system boundaries of the calculation of emissions, the document says.
Meanwhile, penalties have also been increased for deliberate non-compliance, rising by 3-5 times.
“This is all about refining and focusing CBAM – making it stronger and clearer, while cutting out a lot of bureaucracy where that would have a low impact. CBAM will go ahead: on time, as planned, in January 2026,” Rozenberg adds.
Meanwhile, Dan Maleski, senior environmental markets advisor and CBAM lead at Redshaw advisors, tells Kallanish that while the changes may relieve some immediate pressure, the financial risk exposure stays the same. “Companies will still be on the hook for 2026 emissions but won’t need to fully account for them until 2027. This delay doesn’t remove the financial burden, it just shifts when it hits.”
“[This] grossly simplifies an overly-complex and burdensome regulation for importers of smaller quantities of goods: a positive development that made the EU CBAM appear overly-bureaucratic,” he adds. “The proposal maintains a proportionate approach to internalising the external cost of carbon pollution despite the threat of global border tariff escalations.”
Maleski also notes the uncertainty surrounding US President Donald Trump’s threats of reciprocal tariffs and how this will impact CBAM. The EU industry’s existing direct subsidy – EUA free allocation – will be reduced via free allocation reductions, so that a level playing field is baked into the mechanism.
Carrie Bone UK
EU Competitiveness Compass eyes cheaper energy, greater coordination
The European Commission presented its Competitiveness Compass initiative on Wednesday, which foresees a tailor-made action plan for the steel sector, as well as plans to bring down energy prices and introduce European preference in public procurement.
The initiative aims to make the EU market competitive based on recommendations issued by the much-lauded Draghi Report published last September, Kallanish notes.
Over the last two decades, Europe has not kept pace with other major economies due to a persistent gap in productivity growth, the Commission notes. It must act urgently to tackle longstanding barriers and structural weaknesses that hold it back, it adds.
The Commission wants to drive development and industrial adoption of AI in key sectors; promote advanced materials, robotics and space technologies; and remove red tape and risk that is preventing new companies from emerging and scaling up. Companies will benefit from one single set of rules wherever they invest and operate in the Single Market, the Commission says.
The Clean Industrial Deal will aim to make the EU a competitive manufacturing location while simultaneously promoting decarbonisation. An Affordable Energy Action Plan will help bring down energy prices and costs, while an Industrial Decarbonisation Accelerator Act will extend accelerated permitting to sectors in transition.
The Compass refers to a new range of Clean Trade and Investment Partnerships to help secure supply of raw materials from across the globe. Within the internal market, the review of the Public Procurement rules will allow for the introduction of a European preference in public procurement for critical sectors and technologies.
Amid the enablers identified by the Commission, a Horizontal Single Market Strategy will modernise the governance framework, removing intra-EU barriers and preventing the creation of new ones. The Commission will also introduce a Competitiveness Coordination Tool, which will work with Member States to ensure implementation at EU and national level of shared EU policy objectives.
Adam Smith Poland
Assofermet asks EU not to extend safeguard measures
Italian steel trade association Assofermet is advocating for the European Commission to archive the existing safeguard measures and refrain from extending them beyond 31 December 2025.
This is to avoid any overlap with the Carbon Border Adjustment Mechanism (CBAM), which could result in further cost increases for the EU steel processing sector.
In a statement obtained by Kallanish, the association indicates that any modifications to the safeguard system should ensure that the current level of import liberalisation remains intact.
The EC should eliminate the country-specific quotas and replace them with a singular global share for each product category. To optimise the utilisation of quotas, Assofermet also recommends the implementation of a more flexible management system that permits the redistribution of unused quotas between nations at the conclusion of each quarter.
The prospect for extending or intensifying safeguard measures on imports fails to address the structural issues present in the European steel market. The ongoing lack in demand from end-user sectors cannot be resolved by additional import restrictions, the statement argues and adds that it is essential to encourage demand growth through broad economic policies, rather than relying solely on trade defence measures.
The EU steel processing sector has suffered as a result of the present safeguard in place since July 2018. The sector is facing significant challenges due to rising costs, restrictions on duty-free steel imports, and the influx of low-cost finished products from non-EU countries.
Any further safeguard revisions would introduce additional uncertainties into the entire system and supply chain.
In accordance with current EU legislation and World Trade Organisation regulations, Assofermet proposes that the safeguard legislative framework be restored to its original purpose and encourages the EC to prioritise structural solutions that boost demand and competitiveness within the European steel industry.
Last year the EC initiated an investigation to determine whether EU safeguard measures on steel imports need amending to reflect recent market developments, following a request by 13 Member States.
Natalia Capra France
EU announces funding for steel, coal innovation
The European Commission has announced a €175 million ($182m) budget for the 2025 Research Fund for Coal and Steel (RFCS), aiming to advance innovation and facilitate the transition in these sectors.
The funding includes two major calls, or “big tickets,” set to launch in February. The steel sector will receive €100m for projects focused on breakthrough technologies, such as carbon capture, storage, and usage, process intensification, and CO2-neutral iron ore reduction.
Meanwhile, €35m will support coal sector initiatives, including the re-purposing of closed mines, waste treatment, methane monitoring, and the recycling of critical raw materials.
An additional €40m annual call covering both sectors will open in June. Beneficiaries of the funding will include universities, research centres, and private companies.
The RFCS programme aligns with the European Green Deal’s goal of achieving EU climate neutrality by 2050, emphasising clean technologies and just transition in coal mining regions, Kallanish notes.
Elina Virchenko UAE
EUROMETAL asks for clarifications on EU safeguard review
EUROMETAL, the federation of steel, tubes and metals distribution and trading, has formally requested that the European Commission reevaluate certain critical aspects of its review of EU safeguard measures on steel imports.
In a letter to the Commission obtained by Kallanish, the association urges the EC to extend the deadline of 10 January 2025 for the submission of questionnaires related to the review and harmonise customs rules across member states, among other considerations.
Given that the holiday season that occurs from late December to early January, the deadline of 10 January appears to be overly restrictive. A considerable number of EUROMETAL members encountered substantial difficulties in collecting the required data and organising their submissions within the timeline. In response, the European Commission has granted a three-day extension to 13 January. Although the extension is brief, the association contends that it gives businesses more time to better prepare their answers.
The review should also consider the need for standardised customs processes across the EU to make sure that the rules are applied fairly and consistently. This would create a level playing field.
“Divergences in customs rules across member states often result in inconsistent and incorrect declarations, creating unnecessary administrative burdens and an unequal treatment of European importers,” the letter states.
Clarification regarding the definition of “union users” in relation to the review of safeguard measures is urged.
“Specifically, does this definition include the distribution segment (such as service centres, stockholders and traders), which plays a pivotal role in supplying 60% of all steel products to end-users?” EUROMETAL inquires.
The organisation expresses its support for Eurofer’s proposal regarding the establishment of a steel summit by the European Commission. A summit of this nature would serve as a forum for stakeholders to deliberate on the prevailing challenges of the sector and represent an opportunity to work together in identifying solutions that benefit the overall steel value chain.
EUROMETAL represents 17 European national federations of steel distributors, 35 distributors and service centres as well as 25 trading companies.
The European distribution sector procures 70 million tonnes of steel annually and supplies more than a million small and medium-sized end users. It accounts for 60% of the supply of all steel products to end users in EU.
Natalia Capra France