Stalling U.S., EU green steel trade talks could mean reimposition of tariffs

Negotiations between the United States and the European Union (EU) for a “green steel” trade deal have reportedly stalled, risking the reimposition of tariffs on steel and aluminum imports from the EU. These talks, which aim to limit imports from steel-producing countries with high carbon emissions and excess production capacity, are part of a broader agreement on sustainable steel and aluminum. Key points include:

Negotiations began in October 2021 following a truce in the US-EU trade dispute over Section 232 tariffs on steel and aluminum, which had prompted EU retaliatory measures.

Disagreements persist over the structure of trade restrictions to curb carbon emissions and excess production capacity. Differences revolve around the definition of “green steel” and concerns about proposed measures violating global trade rules.

The measures primarily target China, a major global steel producer, which faces concerns over carbon emissions and overcapacity in its steel industry.

If no agreement is reached by the October 31 deadline, the US could reintroduce tariffs on steel (25%) and aluminum (10%) imports from the EU, triggering likely EU retaliatory tariffs.

The EU favors Carbon Border Adjustment Mechanism (CBAM) to address carbon emissions in imports. This mechanism requires importing companies to purchase carbon credits for carbon-intensive goods. The US has reservations about adopting a similar mechanism.

Both sides insist on WTO-compliant solutions, but they differ in their approaches to meeting these rules.

Failure to meet the deadline could extend negotiations into the contentious 2024 election year in the US and may face political challenges. The EU also holds parliamentary elections in 2024, which could impact trade sentiments.

The outcome of these talks has significant implications for global steel and aluminum trade and efforts to combat climate change by promoting sustainability in heavy industries.

Elevate your business with QU4TRO PRO!

Gain access to comprehensive analysis, in-depth reports and market trends.

Interested in learning more?

Sign up for Top Insights Today

Top Insights Today delivers the latest insights straight to your inbox.

You will get daily industry insights on

Oil & Gas, Rare Earths & Commodities, Mining & Metals, EVs & Battery Technology, ESG & Renewable Energy, AI & Semiconductors, Aerospace & Defense, Sanctions & Regulation, Business & Politics.

By clicking subscribe you agree to our privacy and cookie policy and terms and conditions of use.

Read more insights

Germany’s property sector in crisis

The German property market is facing a significant crisis, and developers find themselves most at risk due to a confluence of challenges including rising construction costs, higher interest rates, and falling property prices. This crisis is indicative of a major shift from the years of the cheap-money era when money…

Australia intends to reignite China trade as some restrictions are rolled back

Over the past three years, Australia has experienced a significant downturn in its exports to China, spanning a wide range of commodities. The imposition of trade curbs by China in 2020, including tariffs and unofficial bans, has taken a toll on various sectors, from luxury goods like lobster to vital resources like coal. These trade tensions were ignited when Australia called for an international investigation into the origins of the Covid-19 pandemic, further straining relations that had already begun to sour in 2018 due to Australia’s exclusion of Huawei from its 5G network.

Russian Urals crude faces 40% increase in discount amid G7’s price cap enforcement

The United States’ enforcement of the G7’s price cap on Russian oil, in effect since October, is reportedly impacting Russia’s ability to fetch higher prices for its oil in global markets. A U.S. Treasury official mentioned that the enforcement of the G7’s price cap, which involves placing sanctions…

Stay informed

error: Content is protected !!