Assofermet: Steel safeguard may lead to annual shortage of 1.6 million tons of steel

The new version of the safeguard measures might lead to a shortage of 1.63 million tons of steel, warns the Italian steel association Assofermet. The EU Regulation published yesterday in the Official Journal hosts the main changes already included in the WTO notification, and is specifically dangerous for the EU steel users, the association says:. The Regulation leads to a worsening of the situation for steel importers and manufacturers, that will be forced to pay higher costs for the non-EU steel. "Loss of EU industry competitiveness might be a crucial consequence", says Assofermet while keeping the position on the topic such as previously, after the EU Commission notification to the WTO.

In recent days, Assofermet got in touch with all the relevant institutions to communicate all the limits and dangers of the foreseen alterations. The EU Commission Directorate General for Trade received our letter, also sent via a mailbombing activity by some of our associate members. Also, an Assofermet delegation had the opportunity to arrange a meeting at the Italian Ministry of Foreign Affairs and International Cooperation. On 14th June, some key executives from the Directorate General for Europe and International Trade Policy listened to the points submitted by Assofermet. As well as submitting the points already indicated in the aforementioned press release, one more proposal that we have explored in depth concerns the 15 percent cap on imports from "Other Countries." Assofermet proposed the inclusion of a clause in favour of purchase contracts signed by May 2024. That is, our association asked that the 15 percent cap should not affect contracts signed before May 31st, 2024. We believe that the steel purchased by this date should follow the rules under the Safeguard measures currently in place – it would not be fair to penalize trade deals that were concluded before the EU Commission's notification to the WTO. As Assofermet, we have highlighted the principle of reliability in trade agreements: these are contracts signed by operators in complete good faith, relying on the progressive liberalization of the measure. On the contrary, the rule appears to be extremely worsening compared to current conditions: the liberalization rate has even dropped to 1 percent.

The other point Assofermet focused on is the Safeguard-CBAM overlap for the first 6 months of 2026. The two measures are managed by separate DGs at the EU Commission, so it is important to point out that the two measures will create a kind of double taxation of dubious compatibility. We have explained to the Ministry that Safeguard and CBAM will augment the cost of steel, cascading down to EU manufacturing and the economic system as a whole. Assofermet has intended to make itself available to the institutions through concrete proposals, to limit the negative consequences for the represented sectors as much as possible.

Source.: Assofermet, Photo: Fotolia