Advertising
The EU must accelerate negotiations on the US TRQ’s trust system (TRQ) in order to avoid the existing 50% of the existing duties of steel and aluminum, the European Union’s European Manager, Eurofer said in Euronews. Opportunities in the region.
Such TRQ systems allow you to introduce certain amounts of steel and aluminum with a lower or zero tariff, while each additional value is subject to a much higher tariff rate.
“Tariff quotas are the only hole that we have with the United States,” said Axel Eggert Euronews, adding: “They are not perfect, but at least we can still export to the United States, and now everything is completely different.”
Tariff quotas for steel and aluminum were introduced in accordance with the Biden government to replace 25% of steel and 10% with aluminum imposed by the first government of Trump.
This made it possible to import up to 3.3 million tons of steel EU and 384,000 tons of aluminum in the United States without duties, and duties are used for any additional amount. However, since his return to power, US President Donald Trump stated 25% on steel and aluminum, which in June increased to 50% and expanded on August 19 to 400 derivatives of steel.
EU agreement on duties
After several weeks of tariff disputes aimed at all EU industrial products – not only steel and aluminum – the USA and the EU reached an agreement that establishes 15%duties, with the exception of steel and aluminum.
Nevertheless, a joint statement says that the parties “intend to consider the issue of cooperation in order to allocate their relevant domestic markets from excess production capacities, while ensuring safe supplies of supplies with each other, including through tariff decisions”.
“We hope that we have a clear obligation to support the tariff quota that we had before,” Eggert said. “It was our goal, and it was the goal of the committee, but the committee simply did not understand this.”
Possible opportunities
The EuroFer boss also said that the United States and the EU may make joint efforts to combat the excess of China in the field of steel.
According to OECD, last year there was a worked out surplus production capacity of 600 million tons, and by the next year it is expected that the surplus capacity will be 720 million tons.
“China subsidizes its steel industry,” said Eggert, noting that the Asian giant has more than 500 million tons.
When Trump put 25% on world steel and aluminum in March, cheap Chinese products absorbed it, he added, explaining why the US responsibilities increased to 50%.
The problem of excess production capacities has become an integral part of the last months between the United States and the EU, and the commission strove to cooperate between the two parties.
“If you have two largest markets in the world, the USA and the EU, then you have such power in the market that you do not allow some pairs to pass from companies that produce excess production capacities,” Eggert predicts. “Then, of course, they should reduce the production of excess products.”
In 2021, the Biden government and the European Commission began to negotiate an agreement – a global agreement on sustainable steel and aluminum (Gassa) – on the fight against excesses and the promotion of production with less carbon emissions in its sectors. But negotiations were interrupted after Trump returned to power.
“There is an opportunity (to return), because the US government has already processed it in detail,” Eggert said, noting that the EU was a point of participation (carbon adjustment mechanism). in which the United States is against.