BRUSSELS: The European Union said Friday it would impose tariffs on certain Chinese steel imports, in a sign that the bloc was stepping up its efforts to protect European steelmakers while they struggle with overcapacity.
The provisional duties, which will cover high fatigue performance steel concrete reinforcement bars, or rebars, come as European manufacturers have brought numerous complaints in recent years alleging that their Chinese competitors are exporting some steel products to Europe at unfairly low prices.
European industries say that Beijing’s policies lead Chinese firms to pump out far more goods than its domestic market can consume. The result has been a flood of cheap products shipped to Europe, the U.S. and other developed markets.
The EU’s move—which was announced in a notice on its official journal—also is likely to feed into a debate over whether the bloc should formally designate China a “market economy” at the end of next year, a step that would make it far harder for European companies to protect themselves against low-price Chinese exports.
The decision comes amid a continuing investigation into unfair trade practices by Chinese steel manufacturers and is the result of a complaint lodged in March by European steel association Eurofer, which represents more than 25% of the total EU production of reinforcement bars.
The provisional tariffs will range from 9.2% to 13%, depending on the exporting company, and will last for six months. These could be extended to five years, pending the final outcome of the investigation.
The European Commission, the EU’s executive arm, said it had sufficient evidence that EU-based competitors such as Celsa Group and Riva Group had a “material injury” as a result of the low-price Chinese imports. “It is welcome that the commission is taking remedial action on dumping,” said Charles de Lusignan, communications manager at Eurofer.
He added, however, that “more needs to be done to speed up and modernize Europe’s Trade Defence Instruments, particularly in the light of wider massive Chinese unfair dumping on the EU market.”
Overcapacity in the steel sector has led to thousands of job losses in the European sector in recent months and has caused steel producers around the world to seek government protection from falling prices. Steelmakers in Europe are shutting down production capacity.
In the EU, steel imports from China, the world’s largest steel producer, have more than doubled over the past two years while demand languishes below levels seen before the 2008 financial crisis. This has led to a roughly 40% drop in steel prices over the past two years.
The commission’s decision to impose provisional tariffs came after it indicated it wouldn’t allow EU governments to prop up companies in the steel sector through subsidies. The bloc’s antitrust agency targeted Belgium on Jan. 20 for providing unfair state aid to the steel sector and opened an in-depth probe on assistance given to Italian steel producer Ilva.
