Director-General of the European Iron and Steel Association: Welcome the safeguard measures for iron

Last week, EU member states voted to extend the new steel import quota until July 2021.
In July last year, the European Union voted to implement temporary safeguards for steel imports, which would last for up to 200 days (expiring before February 4).

After voting last week, Axel Eggert, Director-General of the European Iron and Steel Association
After voting last week, Axel Eggert, Director-General of the European Iron and Steel Association (EUROFER), expressed his positive and negative views on this issue.

"In 2018, EU steel imports grew by an unprecedented 12%. Two out of every three tons of steel materials affected by the US 232 tariffs are sold to the European market. Eggert said.

"It is of great significance that the final import safeguards have been voted by EU Member States and will be implemented on February 4, 2019. Although we welcome this decision, the implementation situation facing this measure may undermine the expected safeguard function. Therefore, it is recommended that the European Commission pay close attention to the development of EU steel demand and, if necessary, adjust the current 5% annual increase in import quotas in July 2019.

"These quotas are set in response to the Trump Administration's 232 clause on steel materials and aluminium tariffs and are designed to alleviate the concerns of EU operators about the inflow of large amounts of steel resources into the European market in order to protect traditional trade flows."

Eggert is critical of the 5% annual increase in steel import quotas, which will raise the quota by 5% in 2019 and 5% in 2020, and points out that this may lead to unexpected negative results.
"This means that the increase in quotas may be several times the increase in market size, causing headaches for EU steel producers as their market share shrinks," Eggert said. "Imports of steel materials have accounted for about a quarter of the total EU steel market, and the proportion used to be one-fifth."

Eggert also said it would eventually abolish EU tariff exemptions for developing countries.
"Although we welcome the final restraint measure, which has received strong support from EU member states, we must pay close attention to the trend of EU steel market demand in the coming months to prove its long-term effectiveness." Eggert added.