The Malaysian Iron and Steel Industry Federation (MISIF) has expressed concern over increasing trade restrictions affecting Malaysian steel exports, calling for Malaysian producers to receive fair and equitable treatment as governments strengthen measures to address global steel overcapacity.
MISIF said it respects the European Union’s right under World Trade Organization (WTO) rules to introduce safeguard measures against global steel overcapacity. However, the federation argued that Malaysia should not be disadvantaged, as it has exported steel to the EU in moderate volumes and has not contributed to the import surges that the safeguard measures are intended to address.
The federation noted that the EU’s new tariff-rate quota (TRQ) allocations are based on historical import data from 2022-2024, a period during which Malaysian steel producers were still recovering from the operational and financial impacts of the COVID-19 pandemic, while some companies were only beginning to enter export markets. According to MISIF, these lower export volumes do not reflect Malaysia’s long-term production capacity or export potential.
Malaysia receives limited country-specific quota
Under the EU’s new steel import regime, which entered into force on July 1, 2026, Malaysia received a country-specific quota only for non-alloy and other alloy wire rod. For the remaining 25 product categories, Malaysian exporters must compete within residual quotas allocated on a first-come, first-served basis. As Malaysia does not have a free trade agreement with the EU, it is not eligible for the bloc’s more favorable FTA quota allocations. Imports exceeding quota limits are subject to a 50 percent tariff.
MISIF stated that this outcome does not provide fair treatment, arguing that Malaysia has limited access to the European market despite not contributing to import surges, while larger exporting countries have received dedicated quotas.
Federation highlights challenges in other export markets
The federation also highlighted challenges in other export markets. It noted that Malaysian steel remains subject to the 50 percent Section 232 tariff in the United States, while only a limited number of US free trade agreement partners are exempt. It also pointed to procedural and market access challenges in Mexico, where registration and classification requirements continue to complicate market entry despite the market access objectives of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). MISIF President Roshan M. Abdullah said Malaysia has consistently supported fair, non-discriminatory and mutually beneficial trade, adding that Malaysian producers have exported responsibly without contributing to the overcapacity issues targeted by current trade measures.
The federation welcomed the Malaysian government’s efforts to strengthen the country’s trade position and said it is prepared to provide industry data, technical expertise and recommendations to support Malaysia’s interests in the ongoing Malaysia-EU Free Trade Agreement (MEUFTA) negotiations, which have completed five chapters and are targeted for completion in 2027, as well as in the European Commission’s upcoming review of its steel quota arrangements.