Shielding steelmakers from extreme global competition could prove unacceptably expensive for their European customers, an alliance representing producers of goods as diverse as cars and tin cans warned EU policy makers on Tuesday.
In October, the European Commission proposed to almost half the volume of steel that can be imported tariff-free into the bloc, and to double the duty applied to further imports.
EU steelmakers hailed the move as a “real lifeline” to counter the Chinese overproduction they say is flooding global markets and driving down prices to unsustainable levels. But their European customers aren’t quite as happy.
“As more imports will fall outside the quotas, our industries would have to shoulder between €5 and 9 billion a year in extra tariff costs, assuming that imports stay at the same level as in 2024,” they warned in a letter signed by trade associations representing EU carmakers, tech industries, metal packaging producers and others.
‘Negative impact’
The lobby groups estimate the price increase could be far higher than the 3.25% average forecast by the European Commission, and reach up to 30% in certain product categories.
The steel consumers warned the Commission’s proposal could make it much harder to source steel for specialised industrial applications, and that rules on origin should be less strict.
The trade associations warn that highly integrated in EU supply chains could be unduly hit by the proposed tariff regime, and that trading partners such as Switzerland should be exempted.
“If adopted in its current form, the measure threatens to exert a negative impact on Europe’s steel users,” they wrote, urging EU decision maker to take “a more careful and balanced approach”.
The proposal is currently in the hands of the European Parliament. Once MEPs have agreed a joint position, their lead negotiators will enter final talks with the Council of the EU, which represent national governments.
Ministers have already adopted the Council negotiating mandate in mid-December, introducing flexibilities that would allow the commission to adjust the tariff quota volumes and avoid damaging the competitiveness of downstream industries in Europe.
(rh)