Tag: italia

The trade war initiated by the Trump administration could potentially lead to significant market distortions for Europe, Italian steel trade association Assofermet states in its recently released position paper on US president Donald Trump’s enhanced protectionist policies.

The report obtained by Kallanish expresses concerns about the potential short, medium, and long-term effects of the US’s protectionist stance. The execution of US policies is expected to lead to an important redirection of global steel exports to the European Union, potentially prompting the EU to consider countermeasures aimed at Asian countries.

“A similar scenario, which already occurred in 2018, could have particularly serious consequences, since the delicate European economic balance is no longer able to sustain further [domestic] price increases, without risking a further and irreversible loss of competitiveness,” Assofermet warns.

“The part of the economy most at risk is therefore… the EU manufacturing industry that regularly uses steel… in its production. If we continue to protect only the upstream sector, triggering inflationary scenarios…we will continue to destroy the domestic EU market demand as well as exports of EU finished products,” it adds.

It proposes rethinking the existing protection mechanism and extending it downstream. Currently, Europe is focusing its defensive strategies solely on safeguarding the upstream segment of the supply chain.

The US ranks as the second largest export market for European steel producers, representing 16% of total steel exports in 2024. Europe primarily exports premium steel products to the United States that are not produced on the American soil, distinguished by very high costs and performance.

“Consequently, the application of import duties could be easily absorbed by the importer,” the paper suggests.

The ramifications of these tariffs on Europe may result in a notable reduction in EU exports to the US. This could subsequently diminish the demand for raw materials such as scrap and pig iron from mills that might face challenges in finding alternative export markets.

Production levels in the EU are anticipated to decline and the region may need to extend its safeguard measures and anti-dumping duties on imports from the US. The cessation of steel exports from non-EU countries to the US could result in a substantial influx of these materials into the EU, which may lead to considerable market distortions.

In reaction to the US tariffs, it is also plausible that some steel manufacturers in the EU will consider relocating their production operations to the United States.

Natalia Capra France