South Korea reaches agreement with the EU on steel import policy

Industry Minister Kim Jung-kwan said on Monday that Seoul had reached a broad understanding with the European Union (EU) regarding a new steel import quota system that could adversely affect South Korean steelmakers.

Speaking at a press briefing in Sejong, Kim stated, “Our quota stands at approximately 2.58 million tonnes, and we reached a consensus that this volume would not be reduced by 46%.” However, he did not provide further details regarding the figures.

Kim added, “We are not presenting a special proposal to the EU. However, we have pointed out that the measure violates the free trade agreement and emphasized that Seoul could also consider retaliatory measures.”

The remarks came after Kim's visits to the Middle East, Europe and Kazakhstan.

The development comes as the EU plans to significantly reduce tariff-free import quotas across 30 steel product categories and raise the out-of-quota tariff rate to 50% as part of its efforts to address global overcapacity. The measures are expected to take effect on July 1.

The new system is expected to negatively impact South Korean steel producers. Under the proposed changes, the EU's tariff-free steel import quota is expected to be reduced by 46%, from the current 33.8 million tonnes to 18.3 million tonnes.

Kim also said that the government would take steps to support domestic steelmakers once the final quota details are confirmed.

Commenting on reconstruction projects in the Middle East, Kim said the government would consider related opportunities once regional risks subside. He noted that South Korean companies operating in the region remain willing to participate in such projects, but cautioned that risks persist due to financial sanctions on Iran and the slow progress of negotiations with the United States.

Kim further stated that no final decision has yet been made regarding whether the fuel tax reduction program will be extended, adding that authorities continue to closely monitor developments aimed at restoring normal maritime traffic through the Strait of Hormuz.