The European steel industry faces a defining moment as global overcapacity and cheap imports threaten its future. In a guest article for German weekly business news magazine WirtschaftsWoche, Dennis Grimm, spokesperson of the Executive Board of German steelmaker thyssenkrupp Steel, issued a strong call for effective trade protection, a robust Carbon Border Adjustment Mechanism (CBAM), binding “European Content” quotas, and structural reforms to keep Germany and Europe competitive.
Steel at a crossroads: Overcapacity and job loss
Mr. Grimm warned that blast furnaces across Europe are being shut down due to shrinking demand and fierce global competition. Transformation projects and new investments are being postponed, while jobs vanish at an alarming rate. The ripple effect extends beyond steel, hitting automotive, chemicals and mechanical engineering sectors. Grimm stressed the need for a clear strategy as China and India have shifted from partners to competitors, with China emerging as a systemic rival.
Why trade protection is urgent
Global steel overcapacity is projected to reach 700 million mt - six times EU’s total demand. Much of this comes from China, where steel is subsidized up to 10 times more than the OECD average. Grimm argues that without protection, European producers stand no chance against such dumping practices.
Adding to the pressure, the EU-US tariff deal has fixed a 50 percent import tariff into the US, diverting even more global steel excess to Europe while closing export routes for EU producers. “Doing nothing in the face of overcapacity would have catastrophic consequences for Europe’s steel industry and its value chains,” Grimm warned.
The three urgent measures
- Effective Trade Protection
- Robust Carbon Border Adjustment (CBAM)
- “European Content” Quotas
Brussels has proposed halving duty-free import quotas and applying a 50 percent tariff on excess imports. Eleven EU states support the plan - but Germany has yet to follow.
Grimm criticized loopholes in current CBAM rules, which allow circumvention. He stressed extending CBAM to processed steel products and maintaining free EU ETS allocations until reforms take effect.
To avoid subsidizing foreign producers with domestic funds, Grimm urged binding quotas ensuring public procurement uses a fair share of EU-made steel.
Concrete impact on thyssenkrupp Steel
Grimm revealed that thyssenkrupp is losing contracts to non-European competitors offering steel up to 50 percent cheaper.