In The Steel Watchtower

The European Commission recently announced the introduction of a new safeguard mechanism with the imposition of import quotas per country.

The system can be seen as a counterweight to the tariffs introduced by the US last year, but also as a form of protection of EU companies from aggressive export policies of the main non-EU countries.

The system will also provide for the application of quotas to be allocated quarterly by country in order to regulate the flow of purchases during the year and to avoid seasonal peaks limited to circumscribed temporal arcs.

The opinion of  Riccardo Benso, president of Assofermet, the Italian Association of companies in the trade, distribution and pre-processing of steel products, traders in non-ferrous metals, traders of ferrous scrap and hardware distribution, is that further import duties could cause a surge in steel prices with consequent price increases to the detriment of the final consumer, in particular for household appliances and for automotive sector.

Mr. Benso argues that the US experience has already shown how duties or other forms of protection and safeguarding of domestic production lead to an increase in costs for the production of steel.

It should also be considered that, especially for the automotive sector, the access to EU steel production is extremely limited.

Source: Il Sole 24 Ore, Assofermet

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