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State of the European Union address 2020
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Her speech to the European Parliament touched on a number of policy issues relevant to the European Steel Association (EUROFER). Most notably, these include the raised 55% target for emissions reductions by 2030. As a sector in an advanced state of preparation to reduce emissions, EUROFER sees the target as needing the necessary framework in place to ensure success.
One of the elements of this framework is on the decisive and firm enforcement of trade defence rules. The EU recently modernised its Trade Defence Instruments (TDI), but still needs to be effective in their deployment. While the President touched on WTO reform in her speech, the EU needs to be proactive in seeking out and countering trade distortions that unfairly impact the jobs and prosperity of European citizens.
The Carbon Border Adjustment Mechanism (CBAM) was also addressed by the President. The CBAM aims to balance the concerns of industry about losing competitiveness compared to competitors in third markets who do not face the same carbon cost constraints as European industrial players, versus the ability of European companies to invest in reducing their emissions. Doing so is a matter of urgency, but the parameters of the CBAM must ensure the competitiveness of European industry, including steel, both at home and abroad.
Mrs von der Leyen also addressed a key technology in the push towards green steel, with welcome words on creating ‘hydrogen valleys’. Hydrogen-based steel production, which she mentioned in her speech, is a part of one of EUROFER’s green pathways: carbon direct avoidance. It is a positive step that a project of such importance is mentioned, and it serves as a fine example of the work the European steel industry is doing to help meet its own ambition of a 30% reduction in CO2 emissions by 2030 compared to 2018 (55% compared to 1990) and onwards to 80-95% by 2050, under the right conditions.
Finally, with the corona crisis having struck a severe blow to the European steel sector – with production down by half and 40% of the workforce laid off or on short working at the peak of the crisis in early-to-mid 2020, there is a need for an economic boost. The Next Generation EU recovery plan is a positive start, but EUROFER warns that we must relaunch as soon as possible to be able to ensure a recovery gains pace – giving the sector (and European industry more generally) the ability to advance towards the green future.
Brussels, 10 September 2024 – The Draghi Report thoroughly identifies the bottlenecks to both the EU industry's decarbonisation and competitiveness. The proposed recommendations for energy-intensive industries, including on energy, trade, carbon leakage, financing and lead markets, should be integrated into the upcoming Clean Industrial Deal and implemented with concrete measures as a matter of urgency. Alignment across different policies is crucial, and should be accompanied by sector-specific initiatives to enable the transition of each industry including steel, asks the European Steel Association.
Brussels, 05 September 2024 – The latest developments in the steel sector and across critical value chains are worrying signs of a steady deterioration, endangering the survival and the transition of steelmakers and their key manufacturing customers in Europe, such as automotive. A Clean Industrial Deal including swift and radical measures in EU industrial, energy and trade policies, is the last chance to ensure Europe’s prosperity and shield European industry from cheap imports driven by third countries’ unfair trade practices, overcapacity and lower climate ambition, urges the European Steel Association.
Brussels, 25 July 2024 – Major indicators in the European steel market show a steeper-than-expected downward trend, further impacting the outlook for this year and the next. Poor demand conditions, driven by ongoing factors such as high energy prices, persistent inflation, economic uncertainty and geopolitical tensions, are exacerbated by a manufacturing crisis affecting the largest steel-using sectors, including construction and automotive. According to EUROFER’s latest Economic and Steel Market Outlook, apparent steel consumption is further deteriorating. After a slump (-3.1%) in the first quarter of 2024, its rebound for the full year has been revised downwards (to +1.4% from +3.2%), as well as for 2025 (+4.1% from +5.6%). Similarly, output in steel-using sectors, after a decline in the first quarter (-1.9%), is projected to experience a deeper-than-expected recession (-1.6% from -1%). A recovery is anticipated only in 2025 (+2.3%). Steel imports continue to show historically high shares (27%).