Key facts
- The EU has reduced overall duty-free steel import quotas by 47%, with tariffs on imports above quotas doubling to 50%.
- Twelve countries with free-trade agreements with the EU received preferential treatment with smaller quota reductions.
- China, a major steel producer, faces a significant cut in its tariff-free allocation, down from 2.4 million tons to 800,000 tons.
- Ukraine's tariff-free steel quota was reduced to 1 million tons, less than half of its exports to the EU last year.
- The new measures aim to protect the European steel industry from global overcapacity.
The European Union has finalized new steel import quota rules, significantly reducing overall tariff-free volumes by 47% while doubling tariffs on excess imports to 50%. These measures are designed to protect the EU's domestic steel industry from global overcapacity. Crucially, the EU has negotiated preferential terms with a dozen close trading partners, including the UK, Turkey, India, and South Korea, who will experience smaller quota reductions compared to countries without free-trade agreements.
China, the world's largest steel producer, will bear a substantial portion of the cuts, with its tariff-free allocation slashed from 2.4 million tons to 800,000 tons. This decision follows recent talks between EU trade chief Maroš Šefčovič and Chinese Commerce Minister Wang Wentao aimed at managing trade frictions.
Ukraine, a key partner, faces a particularly sharp reduction, with its quota set at 1 million tons, less than half of its exports to the EU in the reference period. This has raised concerns about its economic resilience and ability to finance its defense. However, Ukraine views the current arrangement as a starting point, anticipating future integration into the EU market.
Free-trade partners that accepted the EU's deal will see their historical tariff-free volumes cut by an average of one-third, while non-FTA partners face reductions of two-thirds. Countries that declined the deal, such as Japan and Vietnam, will see their quotas cut by half. The EU stated that these measures are not solely targeted at China but address structural overcapacity present in other nations as well.