Steel overcapacity: agreement on measures to protect EU steel market

This article is brought to you in association with the European Commission.

On Monday evening, Parliament and Council negotiators reached a political agreement on new measures to counter the negative effects of the global steel surplus.

• Lower import quotas and increased custom duties
• Full compatibility with World Trade Organisation rules
• Better traceability for origin of steel goods
• Supporting Ukraine and its candidate status when implementing quota allocations
• Early review of the number of products to be covered by the regulation

The provisional deal introduces lower import quotas by limiting tariff-free import volumes to 18.3 million tonnes a year: a 47% reduction compared with 2024 steel quotas. It would also apply a 50% customs duty (instead of the current 25%) to imports above the quota and to steel goods not covered by it.

The aim is to equip the EU to counter the negative trade-related effects of global overproduction on the EU steel market once the current safeguards, in place since 2018, expire on 30 June 2026.

Improved traceability

The draft regulation seeks to strengthen the traceability of imported steel products by clarifying the evidence to be provided by importers on the origin of their steel. Members ensured that the Commission will have to take into account the origin of steel when assigning the annual quotas.

Members insisted on the need for an early revision of the new regulation and to adjust its scope if necessary to ensure adequate protection of the EU steel sector. The first review by the Commission will take place in 6 months on whether an extension of the scope of products is necessary or not.

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Karin Karlsbro (Renew, SE), lead negotiator of the file, said: “Combatting the negative trade effects from global overcapacity on the EU steel market is essential. With the agreement, the Parliament, the Council and the Commission could jointly declare the importance of swiftly phasing out all import of Russian steel products.”

Next steps

The provisional agreement will need the formal adoption by both Council and Parliament before it can enter into force. The plenary could vote on the provisional agreement in May. It needs to enter into force on 1 July 2026.

Background

The global steel safeguards, in place since 2018 under the under the World Trade Organisation (WTO) Agreement on Safeguards, will expire on 30 June 2026. With the new regulation the EU steel industry will be better protected to deal with the challenges posed by structural global overcapacity.

The EU steel industry is vital for the EU’s economy and of strategic importance for the EU’s defence capability, as spelled out in the Commission’s steel and metals action plan (SMAP). The industry has faced trade-related challenges, including significant and sustained import pressure in terms of volume and price, as result of global overcapacity. It has also seen about 100,000 job losses since 2008.