The European Parliament and the Council of the European Union have set the dates to implement new framework to address the negative trade-related effects of global steel overcapacity on the EU market. The regulation will replace the existing steel safeguard measures, which expire on June 30, 2026, and will apply from July 1, 2026.
The “melt and pour” requirement the regulation introduces will apply from October 1, 2026. The European Commission is required to adopt detailed implementing rules specifying the evidence required by August 31, 2026. By June 30, 2028, the Commission shall, based on the information collected pursuant to “melt and pour” requirement, assess whether it is necessary to designate the country of “melt and pour” as the basis for benefiting from the tariff quotas provided for in this regulation. Based on that assessment, the Commission may submit a legislative proposal to the European Parliament and to the Council.
By 30 June 2027, the Commission shall assess the necessity of amending the product scope, taking into account in particular whether it should cover additional products that are made of, or contain, a significant amount of steel, including as a matter of priority downstream iron and steel products not covered by the regulation. Where sufficient evidence is gathered in its assessment demonstrating that necessity, the Commission may without undue delay submit a legislative proposal to the European Parliament and to the Council.
By June 30, 2029 and every three years thereafter the implementation of the regulation, the Commission shall evaluate the effectiveness of this regulation, after having carried out broad consultations with stakeholders throughout the steel value chain.
The regulation sets the total annual tariff-rate quota at 18,345,922 mt, while imports within the quota will remain duty-free, while volumes exceeding the quota will be subject to a 50 percent tariff, a sharp increase compared to the previous 25 percent safeguard duty, as SteelOrbis previously reported. Depending on the product category, quota volume reductions of up to 90 percent will be implemented. However, details regarding the country-specific quota allocations have not yet been announced. The market sources believe that 2013 volumes will be the reference for the country-specific quota volumes.
According to the statement, global steel overcapacity is expected to increase from 602 million mt in 2024 to 721 million mt by 2027. The EU stated that increasing global excess capacity, trade distortions and restrictive measures adopted by third countries have intensified pressure on the European steel industry.