The European Steel Industry Association EUROFER has urged the European Union to swiftly implement a new trade mechanism to protect the steel market. This request follows updated data from the Organisation for Economic Co-operation and Development (OECD), indicating a deepening global crisis of excess production capacity in the sector.
This is reported by Finway
Increase in Excess Capacity and Threats to the EU
According to OECD estimates, by 2025, the global excess capacity in steelmaking will reach approximately 640 million tons, which exceeds the total steel production in OECD countries by more than 200 million tons. Meanwhile, the total capacity of global enterprises has reached a record level of 2.4 billion tons. EUROFER emphasizes that this increase in excess capacity intensifies pressure on international markets, causes a redirection of trade flows, and creates serious risks for European steel producers.
EUROFER’s Director General Axel Eggert stated: “The OECD’s conclusions are clear: global excess capacity not only remains significant but continues to grow. This poses an existential threat to European steel production, investments, and jobs.”
Need for Prompt Implementation of the New Mechanism
In light of this situation, the association insists on the urgent adoption of a new EU trade instrument for steel, which is currently under discussion. The proposed mechanism involves establishing a tariff quota that will allow for the control of import volumes while simultaneously protecting the EU’s internal market from the consequences of global overproduction and trade distortions.
EUROFER warns that any weakening of this initiative will negatively impact its effectiveness. There is particular concern about the limited time available, as the existing protective measures of the EU will cease to be effective in June, and even a short delay between the old and new regime could leave the European steel market without adequate protection during a critical period.