Trade Defence Consultation Increases Uncertainty for Stainless Steel Buyers

EU Consultation on Trade Defence Measures Fuels Stainless Steel Market Caution

The European Commission‘s recent consultation on post-2026 trade defence measures has increased uncertainty among stainless steel buyers in the EU. The consultation, which ended on August 18, offered few details about what might replace the current import safeguard measures expiring in June 2026. Many importers have paused new overseas orders, concerned about new tariffs, reduced quotas, and the coming CBAM taxes from January 2026.

Due to the lack of clarity, stainless steel demand remained subdued during the summer period. Prices for grade 304 and 316 stainless steel weakened further, as buyers delayed purchases to avoid potential risks. The market now waits for the Commission to reveal the outcome, expected in Q3 2025.

The Commission’s survey raised alarm by exploring several controversial options. These included a US-style flat-rate tariff, potentially 50% or higher, and an early implementation date of January 1, 2026. Other questions proposed multiple quota volume levels, some of which are significantly below current import flows.

Stainless Steel Buyers Weigh TRQs, Tariffs, and CBAM Risks

The Commission’s potential shift from the current tariff-rate quota (TRQ) system to a flat-rate tariff has split opinion. While some industry groups favor maintaining TRQs, others argue that a flat-rate would be simpler and less disruptive to supply chains. Over 140 industry responses were submitted, highlighting the urgency and complexity of the issue.

The European Association of Non-Integrated Metal Importers & Distributors opposed TRQs. It supported a uniform flat-rate tariff on select stainless products and criticized the “melt and pour” rule from the EU’s previous steel policy. The group warned that adding new barriers—on top of ten existing anti-dumping and anti-subsidy measures—would further distort trade. It also flagged that CBAM will act as an additional cost layer on imported steel.

Eurometal, which represents EU-based distributors and service centres, noted that new measures could improve market stability and investment confidence. However, it stressed that competitiveness relies on consistent and diversified sourcing—both within the EU and abroad.

Exporting countries have also raised concerns. The Korea Iron and Steel Association (KOSA) and the Government of Japan argued that the proposed TRQs may breach WTO rules and existing free trade agreements. KOSA questioned the effectiveness of current safeguards, noting that stainless imports actually rose after their introduction.

Despite weak domestic demand in early 2025, EU stainless imports surged 95.5% year-on-year in the first five months, reaching 743,285 tonnes. Cold rolled sheet imports rose 179.8% in April, while stainless bars and light sections jumped 116% in the same period.

SuperMetalPrice Commentary:

The European stainless steel sector is entering a period of policy-driven volatility. Ongoing uncertainty over trade defence consultation, combined with the looming CBAM framework, is reshaping procurement behavior. Buyers hesitate, prices soften, and contract terms become harder to define. The real risk lies in how fast—and how severely—new rules will impact established supply chains. If TRQs tighten or high flat tariffs emerge, sourcing flexibility could shrink dramatically. Industry stakeholders must scenario-plan now, before regulatory outcomes force reactive decisions.