European downstream manufacturing groups warn that the European Commission’s proposed steel safeguard measures risk undermining industrial competitiveness across the EU. While supporting efforts to address global overcapacity, steel-using industries argue that the current design of the measures goes too far and will significantly raise costs, prices and administrative burdens.

European steel-using industries have voiced strong concerns over the European Commission’s proposal to continue and tighten protection of the EU steel market, warning that the measures could severely impact downstream manufacturing sectors. In a joint statement, industry associations, including CEMA (the European Agricultural Machinery Association), said they support the need to address global steel overcapacity and ensure fair competition for European producers, but stressed that the proposed safeguards excessively restrict market access.

According to the statement, the proposal would almost halve overall steel import quotas while doubling the out-of-quota tariff to 50%. If import volumes remain at 2024 levels, downstream industries estimate additional tariff costs of between €5 billion and €9 billion per year. At the same time, the Commission anticipates an average 25% increase in EU steel prices, with price rises of up to 30% expected in certain product categories.

The introduction of a “melt and pour” rule is also expected to significantly increase administrative burdens, particularly for SMEs, as obtaining detailed origin information for low-value consignments may prove impractical.

These effects, they argue, will compound the cost pressures already arising from CBAM and the phase-out of free ETS allowances, further weighing on Europe’s downstream industrial base.

The EU’s existing steel safeguard regime was first introduced in 2018 following global trade tensions.