Eurofer: EU steel industry falls victim to unfair competition worldwide

Source: Eurofer

Brussels — „The EU steel industry depends on open markets and fair trade. However, since the global crisis, the proliferation of unfair trade practices by non-EU steel producing countries is undermining the level playing field for EU steel producers increasingly weakening their margins“, says Eurofer director general Axel Eggert. „For Europe to keep its global leadership in this strategic sector with hundreds of thousand highly skilled employees, trade policy needs to be reactive and effective, forcefully tackling third market access and raw material export restrictions, and enforcing the EU’s trade remedy instruments without inhibition against unfair trade practices.“

Securing an international level playing field has become increasingly challenging: Free Trade Agreement (FTA) negotiations with major emerging, resource-rich economies are not concluded while protectionist measures are cumulating in all steel regions of the world outside the EU.

Rebound in steel demand absorbed by imports

The only moderate rebound in EU steel demand so far this year – estimated to have grown by about 4 percent over the first three quarters of 2014 – has been largely absorbed by imports. Owing to finished steel imports rising by 22 percent over this period, domestic deliveries by EU mills increased only by around 1.5 percent: EU mills are losing market share to steel suppliers from abroad. At the same time margins of steelmakers in third countries are protected by domestic policies.

„How much longer has the EU steel industry to face worsening unfair competition worldwide?“, Eggert asks. „The EU could use more the weight of its own vast domestic market in tackling third country market protectionism. Leverage towards third countries is critical for the EU, notably in domains where WTO disciplines and enforcement are weak such as subsidies and raw material restrictions.“

EU trade remedy instruments to be modernized

Member states should support the Commission’s proposal on the modernization of the EU trade remedy instruments to swiftly update the basic Anti-Dumping and Anti-Subsidy Regulations, inter alia allowing the imposition of duties which better reflect the real injury caused to European industry (EU’s „lesser duty“ rule).

In particular, the EU should not give Market Economy Status (MES) to China as China’s economy as a whole does not function on free market terms; the country does not meet the EU technical criteria.

Source: Eurofer – The European Steel Association