European Steel Industry: Impact of the Import Quota

Global Economic Impact of Coronavirus – Assessment and Mitigation (B)
Case Code: ECON092
Case Length: 11 Pages
Period: 2018-20
Pub Date: 2020
Teaching Note: Available
Price: Rs.300
Organization : European Steel Industry
Industry :Metals & Mining
Countries : Belgium
Themes: Macroeconomic Environment/ International Business/ Global Economy;Trading Blocks
Global Economic Impact of Coronavirus – Assessment and Mitigation (B)
Abstract Case Intro 1 Case Intro 2 Excerpts


Impact of the Pandemic

The EC began a routine review of the EU steel-import limits in February 2020, when the steel producers demanded a massive quota reduction. According to Eurofer, EU imports of hot-rolled coil in February 2020 were 533,519 metric tonnes, a fall of 22% from January of the year and 11% lower than February 2019. Soon, the EU economies experienced a downturn due to the coronavirus. As the pandemic triggered widespread lockdowns across the EU, the European region’s economy slowed down, affecting the region’s steel consumption and production. ..

Road Ahead

Industry analysts projected that 2020 would be far worse than 2019 for the European steel sector due to the pandemic. Ronnie Cecil, Principal Analyst, Research-Metals & Mining, S&P Global Market Intelligence analyst, expected the EU crude steel production to drop by 10% to 141 million metric tonnes in 2020, which would be barely above the production of 139 million metric tonnes recorded in 2009 after the global economic crisis. Analysts slashed steel consumption forecasts in European countries and downgraded the overall economic outlook. They said they did not expect normal business conditions to return before the third quarter of 2020. However, Eurofer said the construction industry, accounting for around half the region’s steel consumption, might perform better than other steel-consuming sectors in 2020. Analysts expected the demand for long steel products to be high in the construction sector in countries like Germany and Italy...


Exhibit I: Demand and Forecast for Finished Steel Products
Exhibit II: European Union’s Steel Production (July 2019 – May 2020)

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