Coalition warns removal of US tariffs for steel aluminium could impact EU supply chain

As a result of the latest EU-US negotiations on trade on steel and aluminium, the United States has announced that it will no longer apply the Section 232 tariffs on a certain amount of EU exports of steel and aluminium [under “tariff-rate quotas” (TRQs)], effective as of 1st January 2022. 

A coalition of EU trade associations, of which CLEPA is a member, representing the interests of downstream users of steel, welcomes the EU-US agreement on steel and aluminium as an important step  in the trade relations between the two regions. 

However, the typically higher steel prices in the US could mean that European steel currently produced for the domestic market will be exported to the US in larger quantities than what is currently the case. It is important that the EU safeguard measure is reassessed as soon as there is a substantial change in the application of the US 232 tariffs. The coalition urges the European Commission to take into consideration this point during the next review of the safeguard measure on steel imports. 

Europe’s automotive sector in particular, is responsible for 19% of the demand of the EU’s steel industry, supporting tens of thousands of jobs in the European steel industry. Automotive suppliers source most of their steel, by a large margin, within the European Union, and predominantly import specialised steel for which no sufficient European capacity is available.  

In the past 15 months, the coalition’s sectors have also suffered from acute shortages of steel and very high prices in the European market. The removal of the 25% Section 232 tariff on steel exports will increase the attractiveness of the United States as an export destination for European steel makers – even more so given that US domestic steel is now roughly 70% higher than the EU market price.  

The Commission Implementing Regulation (EU) 2021/1029 foresees a “functioning review” of the safeguard that will take place in spring 2022. The coalition strongly urges that the exemption of the EU from Section 232 is analysed during that review. 



    In: CLEPA News, Growth & Competitiveness, Trade
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