European Union Imposes

European Union Imposes Curbs on Steel Import

The European Union is all set to impose limits on steel coming into the bloc from Saturday in response to U.S. President Donald Trump’s metals tariffs, as per a filing in the European Union’s official journal.

Steel imports will face quotas to counter the concerns of the European Union producers who state Europe could be flooded with steel that is no longer being imported into the United States.

There will be specific limits set for the major exporting countries, and the quotas will be applicable for three months in order to limit stockpiling. The significant exporters of steel to the EU are China, India, Russia, South Korea, Turkey, and Ukraine.

The new measure will be effective on 26 steel product categories, with quotas set at the average of imports over the period 2015-2017, plus 5 percent. Once the quotas are filled, a tariff of 25 percent would be applied. They will be replacing provisional measures imposed in July.

As per the reports, the new measure will remain effective for up to three years but can be reviewed in case of changed circumstances. As per the commission, the quotas should also rise by 5 percent from July 1, 2019, and again by the same amount a year later, after reviews.

Steel group Eurofer, whose members include world number one ArcelorMittal and Germany’s ThyssenKrupp, said safeguard in the forms of tariff imposition is wholly justified given the diversion of steel to the EU market.

However, the company has questioned the logic behind the setting of quota at 5 percent above 2015-2017 levels, saying 2016 and 2017 had been recording years for imports, with a further 12 percent year-on-year hike in imports in 2018. It added, the commission should take consider actual market conditions for the first review.

European auto manufacturers association ACEA has stated the measures as protectionist.

The Commission, which investigated the tariff, said import volumes into the EU increased significantly from March 2018, after the United States imposed tariffs of 25 percent on imports of steel and 10 percent on imports of aluminium. It extended the increase in tariff to the European Union in June.

However, the European Union has plans to exclude some developing nations, South Africa and the countries of the European Economic Area, notably Norway, from its quotas.

However, despite its close ties with the bloc, Switzerland, which is home to steel company Schmolz & Bickenbach, will be included in the quota imposition.

Switzerland said country-specific quotas should at least prevent the situation to be repeated in December, when global quotas were filled, forcing some Swiss firms to halt deliveries to Europe. But it is still reportedly pushing for an exemption.


Leo Bell is a writer with more than a decade of experience working for major digital publishing firms. Before joining FinanceThrive, he covered business, entertainment and sports related news articles. Currently, he contributes news stories regarding business, economy, finance, banking, taxes and much more.

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