EU Steel Action Plan threatens downstream industry – Stainless Espresso

13 November 2024 – The EU Steel Action Plan, which is currently being heavily promoted by the steel lobby, is clearly threatening the competitiveness of small and medium-sized enterprises. The fact that the European Economic and Social Committee (EESC) is now also taking sides with the multinational steel producers in the EU and that SMEs are barely worth a marginal mention in their latest paper shows how important the millions of employees and companies in this sector are to the European Union!

EU Steel Action Plan threatens downstream industry

The EU Steel Action Plan pushed by the European steel lobby poses a major threat to the competitiveness of steel processing and consuming companies with their more than 11 million employees in the European Union.

Competitiveness of SMEs to be destroyed

The unreflective view of the European Economic and Social Committee (EESC), which yesterday published its opinion on ‘Sector-specific industrial policies supporting greater strategic autonomy’, clearly shows how one-sidedly it has once again worked in favour of large multinational corporations and their armies of lobbyists. The most important economic players in European industry, the millions of small and medium-sized enterprises, are only mentioned in two marginal notes in the EESC paper. So much for the fact that SMEs should be the focus of the European Union!

The lobbying activities of the EU steel manufacturers are clearly visible in the opinion disseminated by the EESC:

‘In the EESC’s view, any further decline in the metallurgical industry is unacceptable, as it risks seriously undermining the EU’s strategic autonomy, all of its industrial sectors (the rail, nuclear, maritime, space, automotive, defence industries, etc.) and, consequently, the future of EU industry.’
Source: Sector-specific industrial policies supporting greater strategic autonomy

OECD: EU crude steel production to grow by 20 million tonnes by 2026

According to the OECD, the EU’s crude steel production capacity has remained constant at around 214 million tonnes for years. By 2026, almost 20 million tonnes of additional crude steel capacity is to be commissioned in Europe. At 234 million tonnes, this would be the highest production capacity since 2010, ruling out a decline in European steel production industry.

OECD data artificially bloated?

Unless the OECD data, to which the EU steel lobby repeatedly refers, is incorrect and also includes crude steel capacities that have been shut down, mothballed or scrapped long ago. If this is the case, then it probably applies to all countries monitored by the OECD.

CBAM: Level playing field not only for EU steel manufacturers

CBAM represents an enormous bureaucratic and financial burden for small and medium-sized enterprises. The costs for the CBAM certificates will add further financial burdens for SMEs from 2026. EU steel manufacturers are already demanding explicit exemptions for CO2-intensive raw material imports and their millions of tonnes of exports around the world. This is not a level playing field, but fraud against EU SMEs, which are not only being restricted in their economic freedom of choice by dozens of market protection measures on steel, but are also expected to pay the subsidies for over-subsidised and protected large corporations.

Demand: Equal rights for all or abolish CBAM

Either the EU Carbon Border Tax CBAM must apply without restriction to all economic operators in the EU. The CO2 emissions of EU steel manufacturers must not be exported around the world at the taxpayer’s expense. Or CBAM must be abolished immediately to create a genuine level playing field!

Reform of the EU energy market and abolition of energy subsidies for energy-intensive industries

The EU energy market must be comprehensively reformed in the short term in order to lower electricity prices for all. Electricity from coal and gas must no longer be allowed to determine prices on the European electricity market. The merit order principle has had its day and, along with the high grid charges, is largely responsible for the cost of electricity in Europe. In the face of green lead markets for steel, unjustified market protection measures and interference with freedom of choice in the procurement of raw materials and input materials, it is a mockery of the EU to invoke the free market here.

No buck is no excuse for corporations to organise themselves efficiently

Large corporations are responsible for organising themselves more efficiently and getting their costs under control. The level playing field that European steel manufacturers in particular are constantly invoking and presenting as the saviour for everything simply cannot be used as an argument everywhere. It’s just easier when ‘large corporations don’t want to’ organise themselves efficiently and prefer to cry out for subsidies.

Order book shaping is common practice among steel manufacturers

And as we all know, steel manufacturers use order book shaping and customised production processes to trim their throughput in such a way that any electricity price peaks are avoided from the outset and energy costs remain low. And even in the event that someone wants to deny this, they are simply ‘not in the mood’ – see above!

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Disclaimer: Many things here represent our opinion. Others are information from the Internet. We can therefore never claim to be correct or complete. And never base a business decision solely on the news you receive from us.