EU to halve steel import quotas and push to raise tariffs to 50%

South Korea's largest steel export market expected to face major impact

Response as Chinese products blocked from exporting by Trump's steel tariffs pour in

The European Commission is pursuing a plan to halve steel import allocations (quotas) and raise tariffs on volumes exceeding quotas to 50%, the same as U.S. tariffs. While described as a measure targeting China, because the EU is the largest export market for South Korean steel, it is expected to cause significant damage to the domestic steel industry following the U.S.'s 50% steel tariffs.

On the 1st (local time), Reuters reported, citing sources, that the EU plans to propose a new steel industry package on the 7th that includes such tariff measures. Stephan Sejourn, the Commission's senior vice president in charge of industrial strategy, briefed EU steel groups on the matter that day ahead of next week's announcement.

The EU's current steel safeguard expires on June 30 next year. With exports to the U.S. blocked by Trump's steel tariffs, the EU is preparing countermeasures as subsidized Chinese steel products in the steel and other sectors flood in.

The EU has already reduced current steel import allocations by 15% from April 1 and is investigating market trends for safeguard measures on aluminum and scrap metal and for export tariffs.

The EU, which signed a trade agreement with the U.S. in late July, said it will work closely with the U.S. to build a 'metal alliance' and block the influx of Chinese steel. European steel manufacturers are also subject to a 50% export tariff when exporting to the U.S. and Canada.

EU Trade Commissioner Maroš Šefčovič met Jamison Greer, a representative of the U.S. Trade Representative, in Asia earlier this month to resume negotiations. An EU source told Reuters that the new safeguard would serve as a starting point for detailed negotiations with the U.S.

Since 2018, the EU has applied a quota system that sets import limits on 26 types of steel products and has been implementing a 'safeguard' system that imposes a 25% tariff on excess volumes.

According to Korea Trade Association statistics, as of 2024 South Korea's steel exports to the EU amounted to 3,932,366 tonnes, accounting for 13.19% of total steel exports. The EU ranked first last year in both volume and export scale for Korean steel.

Contributing reporter Kim Jeong-ah kja@hankyung.com