The Ukrainian metallurgy industry may lose a key market due to the European Union’s intention to halve the quotas on steel imports. Representatives of Ukrainian steel producers and government officials warn that such measures will significantly impact the country’s export potential, which currently relies on revenue from steel sales to finance defense needs amid the aggression of the Russian Federation.
This is reported by Finway
Impact of quota reductions on Ukrainian exports
Oleksandr Vodoviz, head of the CEO’s office of the Metinvest group, emphasized that the new protectionist measures by the EU could effectively deprive Ukraine of vital export revenues. He stressed that the introduction of restrictions will destroy opportunities for Ukrainian metallurgical companies to supply their products to the European Union market, which remains the main export direction.
According to the rules of the World Trade Organization, the planned reduction of quotas will affect all of the EU’s trading partners, including those countries that have free trade agreements, such as Ukraine. These measures were agreed upon at the beginning of the year as a protection against the consequences of steel overproduction, particularly due to China’s activity in the global market.
The European Commission has been empowered to distribute the reduced quotas among partner countries and is negotiating more favorable conditions for Ukraine and about 20 other countries. During initial negotiations in Geneva, the European Commission proposed a duty-free bilateral quota for Ukraine at the level of 713,000 tons, while in 2025 Ukraine exported 2.65 million tons of steel to the EU.
Consequences for the economy and the position of the European Parliament
Ukrainian officials predict that a 70% reduction in quotas compared to last year could lead to a loss of up to 1 billion euros in export revenues. They also note that such steps do not comply with the existing trade agreement with the EU, which does not provide for customs restrictions on Ukrainian goods.
The European Commission assured that “the EU will take into account Ukraine’s difficult situation” and guarantees the provision of quotas that will ensure steel exports to the European Union, albeit at a significantly lower level than before.
“We are looking at different markets, but in those markets, there are Russians, Turkey, and their electricity is ten times cheaper than ours, and they are not being shelled and bombed every day… we see no opportunity to compete with them in their main markets. Our main market has always been Europe,” he explained.
The European Parliament insisted during negotiations with EU countries on the need to grant Ukraine a special regime as a candidate country due to the “exceptional and immediate security situation,” as stated by MEP Karin Karlsbro. She added that the European Parliament expects effective actions from the European Commission on this issue.