EU to ramp up trade defence with Steel Action Plan

The European Commission’s Steel and Metals Action Plan details its intention to tighten EU trade defence with a new tariff-based safeguard system and “melt and pour” rules for steel imports.

An official document published by the Commission today (March 19) delivered timelines for a series of actions aimed at protecting the EU steel industry. It comes just days after proposed revisions to the steel import safeguard measures were revealed and draws on elements of the region’s broader Clean Industrial Deal. 

The Commission’s proposed revisions to its safeguard measures fell short of the 50% cut to tariff-rate quotas previously called for by Eurofer. However, commenting on the Steel Action Plan, Eurofer president Henrik Adam said: “We are grateful that the Commission has clearly recognised the strategic importance of the European steel industry”. 

MEPS steel market analyst Jon Carruthers-Green said: “The European Commission aims to balance the interests of the domestic steel industry and end-users, though this frequently results in neither group being fully satisfied. 

“That said, today’s announcement will likely be welcomed by steel industry participants, as it confirms the Commission’s commitment to ongoing protection beyond the expiration of steel safeguards.” 

He added: “A key issue raised recently is that the revisions to the steel safeguard measures do not go far enough. Since their introduction, imports from countries such as Vietnam and Taiwan have increased, often amid allegations that the material originates in China and is transhipped through these countries to circumvent restrictions. Today’s announcement on "melt and pour" certification is a step toward addressing these concerns.” 

New safeguard measures 

Describing its plans for the future of the EU’s current import safeguard measures, which expire at the end of June 2026, the Steel Action Plan says that a replacement will be proposed no later than quarter three of this year. The new mechanism will provide “a highly effective level of protection against negative trade-related effects caused by global overcapacities”, it said. 

No firm commitment was made regarding the implementation of a “melt and pour” rule. However, the Commission says that it will assess its possible introduction to avoid circumvention of its trade defence measures.  

In stating the reasons behind its new focus on “sharpening the existing Trade Defence Instruments”, the Steel Action Plan highlighted the recent decline of the EU’s steelmaking industry. It said that EU steel output has declined from 160 million tonnes in 2017 to 126m tonnes in 2023, adding that “the current steel capacity utilisation rate of approximately 65% is unsustainable in the long term”. 

Building on content from the recently published Green Industrial Deal, the plan further sets out its intention to conduct a comprehensive review of CBAM by quarter four of this year. As well as simplifying the emissions-based import regulation, this review will aim to develop an anticircumvention strategy, including extensions to the scope of CBAM to steel-intensive downstream products. 

Policing scrap exports 

Also included in both plans are strategies to which will release funding for the decarbonisation of the EU steel industry and reduce steelmakers’ energy costs. Furthermore, the Commission will set new standards dictating the use of recycled content in sectors traditionally dependent on steel. This comes as part of efforts to accelerate the creation of a circular economy. A feasibility study will be completed by the end of 2026, the plan states. 

Aligning with plans to develop the EU’s circular economy is the proposed implementation of a trade measure to ensure sufficient availability of scrap in the EU. Ferrous scrap exports have more than doubled over the last few years, the plan says, reaching 19.43m tonnes in 2021. This amounts to around 20% of the scrap generated in the EU. 

If necessary, a measure designed to ensure sufficient availability of scrap in the EU could be implemented by quarter three of 2025, at the latest, the plan states. 

Eurofer president Dr Henrik Adam said: “From addressing unfair trade to closing loopholes in the Carbon Border Adjustment Mechanism to recognising the strategic and environmental value of steel scrap, the Action Plan identifies crucial areas for our sector. Now it’s time to implement meaningful solutions through ambitious measures.”