European Commission Prepares New Steel Market Protection Mechanism as Industry Warns of a “Tsunami of Cheap Steel”.
The European Commission has unveiled a draft plan for a new protective mechanism for the EU steel market, responding to a July appeal from 11 member states, including Poland. The initiative aims to strengthen the sector’s resilience against price dumping and unfair competition from non-EU producers. The proposal has been endorsed by the European Steel Association (Eurofer), which represents over 500 steel plants across 22 EU countries, employing nearly 300,000 workers.
“Europe needs coordinated action to curb the influx of cheap steel, prevent job losses, and avoid a slowdown in the green transition,” emphasized Axel Eggert, Director General of Eurofer.
Growing Price Pressure from Asia and Russia
Although EU steel imports reached 18.7 million tonnes in the first half of 2025, roughly the same as a year earlier, analysts stress that the real problem lies in prices, not volumes. According to GMK Center, the recent decline in steel raw material prices has significantly reduced European producers’ ability to plan investments, including those related to energy transition and decarbonization.
“Steel price volatility in recent months has weakened the competitiveness of European mills and hampered the execution of capital-intensive projects. This poses major risks for companies already facing high energy transition costs,” noted Andrii Glushchenko, an analyst at GMK Center.
The steel industry warns that Southeast Asian producers, notably from Indonesia and Malaysia, are exploiting loopholes in EU safeguard mechanisms to flood the European market with underpriced steel, avoiding customs restrictions.
Russian Steel Still Flowing into the EU
An even greater concern remains the continued influx of Russian semi-finished steel products, despite sanctions imposed following Russia’s invasion of Ukraine. According to GMK Center, between January and August 2025, the EU imported 3.59 million tonnes of Russian steel materials worth €1.48 billion.
Average prices for Russian supplies were around €80 per tonne lower than equivalent European products. This not only undermines EU producers’ competitiveness but also enables Russian entities to circumvent sanctions through intermediary supply channels and ambiguous customs classifications.
A striking example is the Czech Republic, where Eurostat data show that imports of steel plates rose from 331,000 tonnes in 2022 to 616,000 tonnes in 2025, with over 85% originating from Russia. The Ostrava and Vitkovice plants, despite ownership changes, continue using Russian semi-finished products. The resumption of rolling operations in Ostrava in early 2025 coincided with an increase in Russian supply, sparking criticism from neighboring producers and industry organizations.
Brussels Responds: New Safeguard Mechanism from 2026
In response to mounting political and economic pressure, the European Commission has drafted a new steel market protection mechanism, set to take effect in 2026. Discussions in Brussels include potential measures to reduce EU steel imports by up to 50%, through new quotas, countervailing duties, and stricter enforcement of sanctions on Russian raw materials.
The proposed framework will combine trade, monitoring, and climate instruments to support European producers during the green transition while protecting them from unfair competition.
“We are already facing cost pressures and huge expenses related to the green transition. Each month without effective trade rules deepens the crisis. Brussels must address both the scale of imports and the legal loopholes still allowing Russian steel to enter the EU. Clear, fair, and transparent rules are needed for all producers,” urged representatives of the steel industry.
Poland and European Partners Call for Urgent Action
Poland, alongside Germany, France, and Italy, is among the 11 member states that issued a joint appeal to the European Commission in July 2025 to implement a new safeguard mechanism. Warsaw supported stronger anti-dumping instruments and called for temporary limits on duty-free steel imports from Ukraine to stabilize the market.
However, experts note that Ukrainian steel is not the source of market instability. According to Ukrainian industry data, exports of rolled and semi-finished steel to Poland currently average 70,000 tonnes per month — about one-third less than before the 2022 war.
At the same time, Ukraine imports significant quantities of coke and coal from Poland — over 600,000 tonnes in the first half of 2025 — highlighting the mutual interdependence of supply chains.
“This trade benefits both sides and shows that Ukrainian steel does not destabilize the market but forms part of an integrated European production network,” industry representatives emphasized.
Europe’s Steel Industry Between Protection and Transformation
The new safeguard mechanism is intended not only as a shield against unfair imports but also as a tool to support the modernization of Europe’s steel industry. The sector is a cornerstone of the EU economy, accounting for over 1.2% of GDP and serving as a foundation for key industries such as automotive, construction, and energy.
At the same time, steel is among the most carbon-intensive industries, with green transition costs estimated to exceed €30 billion by 2030. Effective protection mechanisms are therefore crucial not only to preserve jobs but also to secure investment capital for decarbonization projects.
Outlook: Between Protectionism and Sustainable Growth
Experts warn that inaction in the coming months could lead to a further erosion of Europe’s industrial base. Low steel prices from Asia and Russia, combined with high energy and CO₂ emission costs in the EU, are eroding profitability in European mills, risking plant closures and job losses.
On the other hand, excessive protectionism could limit competition and raise costs for downstream industries. Brussels thus faces the difficult task of striking a balance between market protection, open trade, and WTO compliance.
Conclusion
The European Commission’s new proposal is a response to growing tensions in the EU steel sector driven by price dumping, unfair competition, and geopolitical loopholes in sanctions. The mechanism, planned for implementation in 2026, aims to rebalance the market, protect jobs, and support the steel industry’s climate transition.
Analysts note, however, that its success will depend on legislative details, implementation speed, and the Commission’s ability to maintain equilibrium between economic security and free trade principles.
