Australian steel producers to be hit as European Union plans 50 per cent supersized tariff, imports slashed
The European Union has announced plans to double tariffs and halve the amount of foreign steel it imports, saying Europe’s “sovereignty is at stake”.
The EU has said it plans a 50 percent tariff from next year. This is twice the tariff imposed by US President Donald Trump. The measure will come as a double blow to Australian steelmakers who export to both markets.
Australian steel exports to the European Union are valued at €142 million ($251 million) in 2024. official statistics Compiled by the EU.
The EU is responding to excessive force from China, flooding the European market with even cheaper steel following the United States’ 25 percent steel import tariffs aimed at protecting American production.
The EU said non-market policies and practices had turned the EU’s 11 million tonnes of steel surplus into a 10 million tonnes deficit in just a decade, with 30,000 jobs lost since 2018.
Stéphane Séjourné, European Commissioner for Prosperity and Industrial Strategy, said steel prices will rise, but it is a price worth paying.
“Because talking about Europe as a powerhouse makes no sense if we can no longer produce a car body or tank armor,” he said.
“And everyone knows that it is easy to destroy an industrial base, but very difficult to rebuild an industrial fabric.”
He estimated that restricting steel imports would increase costs by around €50 per vehicle and €1 per washing machine.
“This is a reasonable price to pay for our sovereignty and jobs in Europe,” he said.
He denied that this was aggressive or Trumpian policy.
“I say: No. Europe had not updated its market protection; our sovereignty was at risk,” he said.
“We are not doing what the ‘Americans’ are doing: quotas remain – 18 million tonnes – within which preferential treatment is provided and we will continue our discussions within the WTO with each of our partners.”
EU Commissioner for Trade and Economic Security Maroš Šefčovič said that from June 30, 2026, the EU will introduce a new import regime that will be almost half the steel import quota from 33 million tonnes to 18.3 million tonnes.
Imports above this threshold will be hit with a 50 percent tariff, and importers must disclose that the steel has been melted and cast.
A European Commission official said they intend to carve out country-specific quotas if possible, offering a possible reprieve to Australian producers each night.
Australia does not have a free trade agreement with the EU. Australia exited a deal in October 2023 over a dispute over the level of beef imports the EU was open to allowing.
While President Trump’s trade war has revived talks, this has yet to result in a deal, and the EU has since signed a deal with the South American trade bloc of Mercosur countries, making it politically difficult to sign up for more cattle imports.
But in a Q&A document, the EU said even countries with trade agreements were unlikely to receive exemptions.
“The Commission will discuss the implications of its proposal with trading partners and continue to emphasize the need to find a collective solution to the global overcapacity problem,” the EU said.
“However, we need to be realistic – it is not possible to exclude imports from FTA partners. They represent 2/3 of total imports, some of which contribute to excess capacity, and such exclusion would make the measure completely ineffective.”
Commerce Minister Don Farrell has been contacted for comment.
