Declining demand for stainless steel and low prices could affect the EU market for another four to five months unless the European Commission proposes to introduce a stricter trade protection mechanism, manufacturers say.
The European Commission's proposed replacement of existing import protection measures became known on October 7. This would reduce duty-free import quotas by about 47% and put an end to the practice of shifting unused quotas to the next quarter. It would also double the tariff rate on imports over quotas from 25% to 50%. In addition, a "melt and pour" rule will be introduced, requiring verification of the country of origin of imports as part of anti-circumvention efforts.
The Commission stated that, if approved, the new measures will take effect on July 1, 2026, when the current mechanism will be put into effect. the expiration date has expired. However, European stainless steel manufacturers want the changes to happen as soon as possible to support prices, which have been relatively stable at long-term lows this month.
Some respondents to the European Parliament study believe that the new EU trade protection mechanism may be put into effect as early as April 1, 2026. However, as reported in the European Steel Review by MEPs, the legislation now needs to be approved by all 27 member states. If approved by the EU, you may have to pay compensation or face retaliatory duties on various goods from key trading partners. Consequently, negotiations on the measures being introduced may be delayed.
Revised methodology of import measures
An analysis by MEPs of the proposed EU trade protection mechanism revealed the extent of potential quota reductions for certain types of stainless steel products from key third countries.
The total amount of EU tariff quotas for each category of steel products will be based on the bloc's import volumes since 2013, which allegedly preceded the global steel overcapacity crisis. The allocation of quotas for each product category will be calculated based on the average share of countries in imports in the period from 2022 to 2024.
According to the proposed measures, exporting countries, which account for more than 5% of total EU imports, are expected to receive country-specific quotas. Countries whose share of imports in a certain category is less than 5% are likely to be grouped within the general quota "other countries". Meanwhile, imports from developing countries are exempt from taxes if their share in a particular product is 3% or less.
Reduction of cold-rolled roll quotas
According to this methodology, China and Vietnam will receive quotas.
