Brussels is preparing to make a radical change in its trade policy and protect one of its strategic sectors. The European Commission has put forward a far-reaching proposal: to raise the 50% tariff which applies to steel imports that exceed a certain quota, which means doubling the current rate of 25%.
This tariff increase is accompanied by a second high-impact measure: a severe quantitative restriction. The amount of steel that can enter the European single market without tariff costs will be reduced by 47% compared to 2024 volumes, establishing a new annual limit of 18,3 billion tons.
The objective of this regulatory tightening is clear: to put an end to the devastating effects of global overproduction of steel, a phenomenon that Brussels attributes mainly to China's practices and its massive state aid. The European steel industry has been severely affected by the entry of Chinese steel at artificially low prices, which sometimes range between 200 and 300 euros per ton, compared to the 500 or 600 euros that steel produced in Europe costs. This situation threatens the viability of the plants and puts thousands of jobs on the continent at risk.
For this new safeguard to be effective, the proposal must receive the green light from both the European Parliament and the Member States. If approved, it is expected to enter into force in 30 June, 2026, the date on which the current protection mechanism expires. In addition, to prevent fraud and evasion, tighter controls to verify the actual country where the steel has been smelted.
With this initiative, Brussels not only seeks to defend its industrial sovereignty and increase the utilization of the productive capacity of its steel mills to a target of 80 %, but also coordinates its strategy with the United States in a common front against Chinese competition.
Impact on the value chain
Although the European steel industry has described the measure as a "lifeline," the decision will have repercussions throughout the supply chain. The increased cost of imported steel will foreseeably lead to a rise in the overall price of this raw material in the European market.
This cost increase will directly affect key manufacturing sectors that are large consumers of steel, such as automotive, construction or household appliance manufacturingAs a result, companies are likely to pass on some of this increase to the final price of their products, which could generate inflationary pressures and affect consumers' purchasing power.
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