Don’t panic, says Australian Steel Institute after Europe announces tariff plan

Following the European Commission’s announcement of plans to halve the quota of tariff-free steel imports and apply a 50 per cent tariff beyond that, the Australian Steel Institute (ASI) has urged against panic, saying there were “no surprises” in the news and that the plan has yet to be ratified.

This week the EU proposed a 47 per cent reduction in its steel import quota from 2024 levels to 18.3 million tonnes per annum, after which a duty will apply. It follows the USA’s move to double steel tariffs against Europe.

Mark Cain, head of industry group the ASI, which represents 700 Australian companies, said that only the size of the tariff was news.

“It is a plan and has yet to be ratified. We will work with the Australian Government to ensure the best possible outcome for the Australian steel industry,” said Cain (pictured.) 

The ASI said that the European development comes as the ASI is “looking to apply to the Australian Federal Government” for a Safeguard action to protect the local steel industry “against a surge in cheap imported fabricated steel”. 

According to Cain, local industry is facing challenges on numerous fronts, with US, Canada and now EU tariffs “likely to cause trade diversion” and the “collective impact of tariffs across multiple markets” is increasing the problem of excess global steel supply.

He added that the sale prospects of Whyalla are “likely to be impacted by this additional tariff development if there is an effect on accessible markets for their products”. 

The BBC reports that the new tariff regime in Europe needs to be approved by a majority of European states and the European Parliament before coming into effect next year.

The European Steel Association, Eurofer, said the tariff plan is “fully WTO-compliant”, unlike US steel tariffs on the EU, and is needed to protect the industry “from unfair imports flooding the EU market” due to an oversupply globally.

“This quota is set in line with 2013 market conditions before the first wave of Chinese steel flooding, at over 18 million tonnes of tariff-free steel – an amount almost equivalent to the combined steel production of France, Belgium, and Luxembourg,” said Eurofer. 

“Only unsustainable imports above quota levels will be subject to a 50 [per cent] tariff to avoid further import deflection towards the EU, with regular revisions to ensure quotas remain aligned with market conditions in the coming years.” 

Picture: supplied

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