The European Steel Association (EUROFER) has stated that it welcomes the European Commission’s (EC) safeguard investigation into 26 steel product types to prevent trade deflection into the EU. The basis for a safeguard comes from the need to defend the EU’s steel sector against product flows deflected from the US as a result of the Section 232 measures.
“The investigation must act fast and actually put safeguard measures in place on as wide a range of products as possible, to prevent harm to the industry from trade deflection. As the European Council said on Friday, the EU has the right to ‘respond to the US measures as appropriate and in a proportionate manner’ - and EUROFER urges the European Commission to impose provisional measures as swiftly as is possible under EU - and WTO - law,” stated Axel Eggert, director general of EUROFER.
“The fact that the EU and other countries are out of the US measures for now does not mean we should not prepare. Indeed, in the first two months of the year, finished steel imports rose by 12 percent in the EU - over and above the record import volume of 2017. The volumes that could potentially be deflected to the EU market measure in the millions of tons and would have a devastating pricing impact,” added Mr. Eggert.
The US-South Korea deal to limit Korean steel exports to 2.7 million mt - 70 percent of the average of 2015-2017 volumes - could well see the remaining 30 percent deflected to the EU. Exports to the EU from South Korea have more than doubled since 2014 to over 3.1 million mt.
“The EU steel sector has only just got back on its feet. This safeguard action - if sufficiently broad when deployed at the provisional and the definitive stages - could make the difference between a continued recovery or a return to the dark days of the steel crisis,” concluded Mr Eggert.