Machine Tools Industry calls EU leaders to reconsider their approach on the safeguard measures on steel imports

08 April 2022

As a steel user industry, CECIMO expresses its deep concern over the impact of recent developments and the Russian-Ukrainian conflict on the European steel market and European machine tool sector.

In June 2021, the European Commission prolonged for three additional years, the EU safeguard measures on imports of certain steel products. The prolongation of measures introduced in July 2018 has had a direct impact on the competitiveness of the manufacturing sector. Following the escalation of tensions between Russia and Ukraine, the EU implemented a series of trade restrictions raising the stakes for industries that are already under pressure from soaring energy costs and critical raw materials. With additional sanctions, specifically an import ban on steel products from Russia and Belarus and reduced steel inflows from Ukraine, machine tool producers have encountered even more difficulties in sourcing steel.

CECIMO is aware that there has been an adjustment to the EU steel safeguard quotas following the imposition of steel import bans from Belarus and Russia. However, we do not consider this to be an adequate and timely response to the current steel supply problems experienced by our members. CECIMO repeatedly expressed its concerns about the consequences of the EU safeguard measures on the competitiveness and productivity of the sector.

It is of utmost importance to highlight that the issue of safeguard measures on steel imports remains closely linked to the rising energy costs and supply chain disruption our sector has faced since the start of 2020. Rising energy costs, higher commodity prices, transportation problems, and strong inflationary pressures are negatively impacting our sectors' competitiveness in global markets.

Following CECIMO’s position paper on Renewed EU Safeguard Measures, we remain of the view that safeguards, in this form, are not the appropriate instrument to improve the recovery of steel production in Europe. As such, we believe that these measures are having negative effects on the steel-using manufacturers. The European MT sector is highly export oriented and as such holds the highest market share globally (approx. 34% in 2020), closely followed by China (approx.  28% in 2020).

Therefore, in order to retain European leadership in this sector, which is of strategic importance, central to supporting European economic growth, the European Commission should review policies to safeguard measures on steel imports to meet and stabilise prices and current steel demand.

"In these challenging times, the EU leaders should reconsider their approach regarding the EU safeguard measures on steel imports. A new approach is of paramount importance to ensure strong support to European businesses, which have already been hit hard by energy and supply chain issues caused by the COVID19 pandemic." - Filip Geerts, Director General, CECIMO