EU EXTENDS STEEL SAFEGUARD MEASURE UNTIL JUNE 2026

Brussels – In a significant policy update, the European Commission has extended its steel safeguard measure for an additional two years, with the new expiration date set for June 2026. This decision, formalized through an implementing regulation on 25 June 2024, also includes adjustments designed to align the measure with current market dynamics.

The extension follows an investigation prompted by fourteen EU Member States, which affirmed the necessity of the safeguard measure to avert or mitigate substantial damage to the EU steel industry. The investigation highlighted the industry’s ongoing adaptation to elevated import levels.

Several critical factors have been identified as exacerbating import pressure on the EU market. Global steel production capacity remains persistently high, disrupting market equilibrium. There has been an observed increase in steel exports from China to various Asian countries, which subsequently has led to higher exports from these regions to the EU. Additionally, many third countries have implemented stringent trade defense and restrictive measures. Furthermore, declining demand for steel products within the EU is further straining the market.

The revised technical adjustments will come into effect on 1 July 2024. The safeguard measure is scheduled to lapse on 30 June 2026, adhering to the maximum duration of eight years permitted under EU and WTO regulations. Nevertheless, the European Commission reserves the prerogative to review and modify the measure’s operation before this deadline if further adjustments are warranted.

Industry expert Carruthers-Green notes that this extension represents the final opportunity to prolong the safeguard measures under current WTO rules. He observes:

“Many steelmakers understandably believe that the safeguard measures will still be necessary beyond this point. Other market participants, particularly those reliant on imports, point out that the definitive CBAM period will be in effect by 2026, providing European steelmakers some level of protection. There is a case to be made that both schemes are necessary as their objectives are different. CBAM is designed to level the playing field for European steelmakers as they tackle the challenge of decarbonising the industry, and of course, carbon costs for European steelmakers will increase in step with those applied to imports. The safeguard measures are targeted specifically to counter oversupply and redirected trade that will still be occurring in 2026.”

EU safeguard Timeline

• July 2018: Provisional safeguard measure introduced to protect EU steel producers from economic harm, particularly in response to the United States’ Section 232 tariffs on steel products.
• Early 2019: Measure confirmed and extended.
• June 2021: Measure extended through June 2021.
• June 2024: Most recent evaluation in June 2023, measure extended to June 2024. Since July 2019, TRQ levels increased by 25%.
• June 2026: Final extension to June 2026, with a 25% duty on imports exceeding the TRQ levels.