2 September 2025 – For some time now, European steel producers have been pushing for an export ban on steel scrap. The domestic recycling industry, however, is strongly opposed. So far, the EU has tended to side with the steelmakers – even though the Commission itself has acknowledged: export restrictions significantly restrict entrepreneurial freedom!
Are Export Restrictions on Scrap Really Justified?
European steel producers have long sought to impose an export ban on steel scrap. With the revised Waste Shipment Regulation, which limits scrap exports to OECD member states, they have at least partially succeeded.
But this is not the end of the story – in the headquarters of Europe’s major steel companies, the ultimate goal is to keep all scrap within the EU. With its Steel and Metals Action Plan, the European Commission has once again attempted to push through an export ban to the benefit of its favored lobby.
As so often, the arguments of the recycling industry – made up largely of small and medium-sized enterprises (SMEs) – have failed to gain traction in Brussels. Yet export restrictions would cause substantial damage to this strategically important sector.
Paper: Are Export Barriers on Recycled Steel Economically and Ecologically Justified?
A recently published paper by German professor Dr. Frank Pothen, titled “Are export barriers on recycled steel economically and ecologically justified?”, could provide much-needed support to the recycling industry, which is urgently seeking political backing.
Key points include:
- Recycled steel is a continuously available raw material and should be fully utilized.
- Each ton of melted scrap saves around 1.66 tons of CO₂, regardless of where it is used.
- Europe’s net exports mainly reflect weak domestic demand, not oversupply.
- The EU remains dependent on imports of high-quality recycling materials such as stainless-steel scrap.
- The central future challenge is quality, not quantity, of recycled steel.
- As scrap trade is highly cost-sensitive, trade barriers can divert flows away from Europe.
- Export restrictions carry risks: retaliation, reduced access to high-quality imports, lower global scrap utilization, and increased global CO₂ emissions.
The paper concludes that instead of introducing export barriers, policymakers should address structural issues such as high energy costs, improve recycling processes and standards, and promote investments in high-quality recycling and stronger market demand.
Commission: Export Bans Restrict Entrepreneurial Freedom
It is worth recalling that in 2022, during the EU’s anti-subsidy investigation against Indonesian stainless steel, the European Commission itself determined that export restrictions/bans significantly limit entrepreneurial freedom. The Commission also noted that such bans foster an oligopolistic buyer’s market, exerting considerable influence over price formation.
Based on the findings of that case, one clear conclusion emerges: an export ban on steel scrap would serve only the interests of domestic steel producers while severely disadvantaging the recycling industry. In doing so, the Commission would once again risk deliberate distortion of markets and competition.
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