- 20 Mar 2025
- ICICIdirect Research
THE EUROPEAN UNION PROPOSES RESTRICTING STEEL IMPORTS BY 15% FROM APRIL’25 IN ORDER TO CURB CHEAP STEEL IMPORTS
News: As per media sources, the European Union proposes restricting steel imports by 15% from April’25 in order to curb cheap steel imports. Additionally, it expected to propose a long-term replacement for its steel safeguard measures, which will take effective after the quota system expires next year. Moreover, the commission will also consider implementing similar measures for the aluminium sector.
View: From media sources, its already estimated that India’s hot-rolled coil (HRC) quota is expected to cut by 23%, effective from April’25. Now, with prolonged restriction measures being consider it will have a structural impact on India steel exports segment given Europe has been a lucrative market, contributing the highest of ~38% of India steel exports in April’24 to Feb’25 period. Thus, within steel space, JSW Steel is likely to have negative impact, as it has higher share of exports (14% of Indian sales volume in FY24) among its peers. While Tata Steel will be beneficiary given it has a ~7 MTPA production capacity in Netherlands, accounting ~25% of the consolidated revenue of company. On the aluminium space, the major players such as Hindalco and NALCO have a limited exposure to exports, making them less vulnerable to these trade restrictions. HEG and Graphite India will also be benefit, considering the western countries have more EAF steelmaking capacities.
Impact: Negative