- EU cuts import quotas by 47% from CY’24 level
- Out-of-quota duties doubled to restrict imports
The Council of the European Union has adopted its mandate to negotiate a new regulation aimed at protecting the EU steel market from the negative trade effects of global overcapacity. The framework will replace the current steel safeguard measure, which expires on 30 June 2026.
Key provisions of mandate:
Import quota cuts: The Council has retained the European Commission’s core proposals, including a reduction in tariff-free steel import quotas to 18.3 million tonnes (mnt) per year, down by 47% compared with 2024 levels. In addition, the out-of-quota duty will be doubled to 50%, from 25% under the existing safeguard.
Downstream flexibility: To balance producer protection with the interests of steel-using industries, the Council added “Union interest” as a guiding principle while allocating or amending tariff-rate quotas. It also introduced a provision allowing unused quota volumes to be carried over from one quarter to the next within the same year, improving quota flexibility.
The regulation will cover imports from all third countries except EEA members, with total adjusted quotas set within a range of 15.2 to 22.2 mnt. The Commission will review the regulation’s impact within four years of entry into force, with a stronger focus on downstream industries.
Melt-and-pour rule: To prevent circumvention and improve transparency, importers will be required to declare the country of melt and pour from 1 October 2026, following a transition period. The Commission will assess within two years whether melt-and-pour should become the basis for country-specific quota allocations.
Review and next steps: Negotiations with the European Parliament will begin once it adopts its position, with the aim of finalising the regulation before the current safeguards expire on 30 June 2026
Outlook
The EU Council’s move to tighten steel import safeguards has already set a more protectionist tone for the market ahead of the June 2026 expiry of current measures. Lower tariff-free quotas and higher out-of-quota duties are expected to constrain import inflows and support domestic prices. However, flexibility measures for downstream users are likely to moderate the impact, limiting sharp price volatility. Trade flows are expected to adjust ahead of the introduction of the melt-and-pour requirement in October 2026, while market sentiment is likely to remain cautious until negotiations with the European Parliament are concluded.
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