EU Probe of Chinese Steel Will Disrupt Global Supply Chains, China Warns

16 Oct 2023

What’s new: China warned that the European Union’s plan to investigate Chinese steelmakers over subsidies will disrupt global supply chains and push up costs.

“The EU’s practices will push up downstream production costs, affecting the interests of consumers, and are not conducive to the stability of global industrial and supply chains,” said He Yadong, a spokesman for China’s Ministry of Commerce, Thursday at a press briefing.

The Financial Times reported that the 27-nation bloc is planning to announce anti-subsidy probes into steel products from China in late October as part of an agreement with the United States to end Trump-era tariffs on EU steel.

The context: The EU and the U.S. are expected to announce a Global Arrangement on Sustainable Steel and Aluminum (GSA) curbing exports of Chinese metals when U.S. President Joe Biden hosts European Commission President Ursula von der Leyen and European Council President Charles Michel Oct. 20, the Financial Times reported, citing unidentified EU officials.

Industry experts predicted limited impacts from the planned EU probe into Chinese steelmaking due to shrinking exports.

Steel exports from China to the EU declined significantly in recent years due to antidumping tariffs imposed by Brussels, according to the China Metallurgical Industry Planning and Research Institute.

In 2022, China exported 3.89 million tons of steel to the EU, accounting for 5.8% of its total exports. The top three destinations were Italy, Belgium, and Spain, with coated sheets, bars, electrical steel sheets and strips, and cold-rolled thin sheets as the main products, according to the report.

The European Commission recently launched an anti-subsidies probe into electric vehicles manufactured in China, focusing on battery-powered electric vehicles and alleged subsidies granted by the Chinese state.