Against the backdrop of the EU parliamentary elections, the European Steel Association (EUROFER) has called for urgent action by EU policy makers to help the sector as it faces down the flood of steel exports deflected to the EU because of the US imposition of steel import tariffs in 2018. EUROFER has also called on EU policy makers to meet with them urgently to discuss how to end the crisis.
EUROFER pointed out that the global overcapacity is the principle underlying factor behind the present crisis, but added that the direct cause is the vast flood of exports targeting the EU market. Imports rose 12 percent to nearly 30 million mt in 2018 in the wake of the imposition of the US Section 232 steel tariffs.
High and volatile raw material prices, slowing demand in downstream sectors, sharply higher carbon costs - five times higher than at the beginning of 2018 and borne by EU steel producers but not by imports of steel into the EU - and faltering EU economic performance have also increasingly squeezed the sector in recent months.
“While imports are an essential element in a competitive economic environment, it is the cause and rate of change that has undone the EU steel market. Imports have more than doubled since 2013”, added Axel Eggert, director general of EUROFER, who went on to say, “EU steel demand has increased only marginally over the same period. We expect there to be a decline of 0.4 percent in demand in 2019.”
“This is an acute crisis, reinforced by chronic underlying problems in the global steel market. European steel companies and their employees’ livelihoods are now actively threatened as a result. We need urgent action from policy makers to arrest what otherwise will become a precipitous decline,” emphasized Mr. Eggert.