The European Commission has announced that it is initiating an investigation reviewing the safeguard measures on imports of 26 steel products. The current quotas will expire on June 30, 2024, unless there is a decision to extend them. Any decision on an extension should take place before the expiry date as some technical adjustments to the functioning of the measure may be made.
The decision to review the safeguard measures was made following the request of 14 EU member states suggesting that the safeguard measure continues to be necessary to prevent or remedy serious injury. The member states pointed out the fact that global overcapacity remains at a very high level, that a relevant number of trade measures by third countries continue to be adopted, and that there are no elements suggesting that the US will be removing the Section 232 measures on steel. Thus, the risk of trade diversion continues.
Commenting on and welcoming the review announcement, the European Steel Association (EUROFER) stated, “The unprecedented expansion of China's steel capacity over the past two decades has resulted in a profound imbalance in global steel markets. Adding to the complexity of the situation, new dynamics of excess steel capacity are emerging also on a regional scale, particularly in Southeast Asia (ASEAN countries, India), the Middle East, and North Africa. These new capacities are shifting trade patterns, as traditional exporting countries are being replaced and faced with reduced export opportunities and more closed markets, compelling them to seek alternative export markets. Consequently, the European Union has become a primary target for trade deflection, with steel exports increasingly redirected towards its market.”
