As the European Commission brings new regulations on scrap trade to its agenda, industry stakeholders continue to voice their concerns. While the Commission acknowledges that the demand for scrap in Europe is lower than the current supply, it envisions implementing trade measures to keep excess scrap within European borders. However, this approach has been met with strong opposition from industry representatives.
Industry Stakeholders Express Concerns
The idea of imposing additional taxes on scrap trade has sparked significant concern within the industry. Many experts argue that the domestic market is not strong enough and that such a tax could further exacerbate existing challenges. Additionally, due to differences in quality between European and U.S. scrap, European scrap is already priced lower than its U.S. counterpart.
European steel producers' selective approach and lack of interest in lower-quality scrap could negatively impact demand for such scrap, particularly in export markets like Türkiye. Industry representatives oppose any form of restrictions on imports and exports, arguing that such measures distort free and fair trade.
While European steel producers advocate for the taxation of scrap exports, it is claimed that these initiatives are driven by major international corporations seeking to monopolize raw material supply. These concerns raise serious questions about the future of European industry.
On the other hand, experts suggest that, in the long run, customs duties will not halt the flow of ferrous scrap exports. Instead, they argue that these taxes will simply impose additional costs on overseas importers. This could lead to further restrictions in international trade and encourage other countries to adopt similar trade measures.
Steps to Protect the EU Steel Industry
Despite acknowledging that demand for scrap in Europe is lower than supply, the European Commission plans to introduce trade measures to keep excess scrap within the EU. However, ASSOFERMET pointed out that the Waste Shipment Regulation, published in April 2024, already imposes strict limitations, while concrete steps to increase the use of recycled steel remain undefined.
Under the new regulations, the liberalization rate will be reduced from 1% to 0.1%, limiting the amount of steel that can be imported into the EU duty-free. The European Commission also emphasized that most scrap within the EU is already being utilized, while the remaining portion remains idle due to a lack of domestic buyers.
These new regulations on scrap and steel trade in Europe have the potential to cause fluctuations in global markets. The actions taken by the European Commission will be crucial not only for European industry but also for the global scrap and steel trade.
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