EU should do more to curb steel imports from Asia, says Acerinox CEO

By Matteo Allievi

(Reuters) -The boss of Spanish steelmaker Acerinox says the European Union should do more to curb steel imports from Asia, which are hurting some of the EU's mills as demand and prices weaken.

"China raised steel production by 13% in 2023 while the rest of the world lowered it due to weaker demand. Indonesia and China have already surpassed 70% of the world's steel production share", Acerinox CEO Bernardo Velazquez told Reuters.

With domestic demand not recovering as much as expected, China's exports of steel products rose by 25% in March year-on-year to 9.89 million metric tons, the highest since July 2016.

The call for more action comes after Acerinox warned on Thursday that the European market had shown little sign of recovering, even with its Cadiz mill in Spain being shut for three months due to an ongoing strike.

The EU already has punitive tariffs in place on 18 grades of Chinese steel and stainless steel products and set quotas on all steel imports as part of measures to safeguard its market. Above those limits, imports incur a 25% duty.

"Safeguard measures are necessary, but they are not sufficient. The EU should impose more tariffs, imitating the United States' model, so that the Asian markets have the same rules of the game," Velazquez said.

The European Commission said earlier this year it was investigating whether the measures, which expire on June 30, should be extended.

In the United States, certain steel products face a levy of up to 7.5% under a Trump-era policy.

Last week, U.S. president Joe Biden proposed raising tariffs on Chinese metal products to 25% as part of a package of policies ahead of the election.

Acerinox said on Thursday it would close its factory in Malaysia's Bahru, which is specialised in cold lamination, in the second quarter due to low prices among Asian competitors.

Swedish peer SSAB was less worried about the competition from Chinese rivals.

"We don't see much Chinese material into Europe yet in our product groups. But what we see is that China is exporting to (South) Korea and India and those a bit into Europe," CEO Martin Lindqvist told Reuters.

(Reporting by Matteo Allievi;Additional reporting by Marta Frąckowiak in Gdansk and Philip Blenkinsop in Brussels;Editing by Josephine Mason and Mark Potter)