EU slashes steel import quotas by 47% as new protectionist regime takes effect

The European Commission adopted a regulation on 30 June that halves the bloc’s duty-free steel import quota and doubles the out-of-quota tariff, marking the biggest overhaul of its steel safeguards since 2018. The new rules take effect on 1 July 2026 and are designed to lift EU steel capacity use to 80%, though industry expects a more modest recovery.

What changes

Annual duty-free steel imports are cut to 18.3 million tonnes, down from nearly 35 million tonnes under the expiring safeguard. Imports above that ceiling in 26 product categories will face a 50% duty, up from 25% previously. The Commission also introduces traceability requirements: importers must declare where the “melting and casting” stage takes place.

Half of the 18.3 million tonne quota is reserved for countries with which the EU has a free trade agreement (FTA), while the other half is open to all. The Commission says the methodology is “fair and objective” and WTO-compliant. Countries belonging to the European Economic Area – Norway, Iceland and Liechtenstein – are exempt from the measures. Switzerland sought an exemption but was not granted it.

Deals with trade partners

Thirteen countries accepted country-specific quota allocations after months of talks at the WTO in Geneva, waiving their right to challenge the measures bilaterally or at the WTO. The partners are the UK, Turkey, South Korea, Indonesia, Egypt, Brazil, Switzerland, North Macedonia, South Africa, Argentina, Ukraine, Singapore and India. For these nations duty-free volumes drop by about 33% compared with previous levels, while the overall EU quota cut is 47%.

The UK, which exported 1.7 million tonnes of finished steel to the EU under the old safeguards, faces a roughly 22% reduction from last year’s volumes. Business and Trade Secretary Peter Kyle said:

Our priority is providing the best possible outcome for the U.K. steel industry, which is why we have engaged tirelessly with the EU and will continue to work to strengthen U.K.-EU steel trade long-term.

Pressure on China

China, the world’s top steel producer, has no FTA with the EU and sees its tariff-free allocation fall from 2.4 million tonnes to 800,000 tonnes – a two-thirds cut. The move came a day after Chinese Commerce Minister Wang Wentao met EU trade chief Maroš Šefčovič in Brussels and agreed to set up a Trade and Investment Consultation Mechanism. A senior EU official said the quota reductions were not directed solely at China:

I do want to dispel the idea that this is only about China. The non-market part is driven more by China, but the structural nature of overcapacity is also present in other countries.

How much production can be saved

Eurofer, the EU steelmakers’ association, said the measures could raise capacity utilisation from the current 67% to 73–75%, short of the Commission’s 80% target. Director General Axel Eggert estimated that European mills could produce an additional 15 million tonnes – about half the volume lost in recent years – and suggested the safeguards might later need to be extended to downstream sectors such as laminators and automotive stamping.

The bigger picture

The new regime replaces the 2018 safeguard that was already meant to curb import surges. EU Commission President Ursula von der Leyen has called steel a central engine of European prosperity. The twin goals are to preserve industrial jobs and to give steelmakers the financial room to invest in cleaner, leaner production as the Union pursues carbon neutrality.