Brazil warns of trade escalation over EU steel restrictions

Brazil has voiced strong criticism against the European Union's recently implemented measures to restrict steel imports, asserting that these actions will curtail access for Brazilian exports to the EU market and could potentially ignite a broader trade escalation.

In a joint statement, Brazil's Ministries of Foreign Affairs and of Development, Industry, and Trade expressed regret over the EU's decision to lower the quotas for tariff-free steel imports and subsequently raise duties on volumes that surpass these thresholds. The new regulations, which affect most of the EU's trading partners, tighten the conditions for exporting steel to the bloc. They replace the safeguard system in place since 2018 with a new framework that permits fewer tariff-free imports and imposes higher taxes on shipments exceeding the set limits.

The Brazilian government highlighted that it also faces challenges due to global steel overproduction and affirmed its commitment to pursuing multilateral solutions through international forums. However, Brazil contends that imposing trade restrictions on countries not responsible for the worldwide oversupply is counterproductive and may lead to retaliatory measures in trade defense.

The European Commission announced it would reduce the volume of steel allowed into the bloc without tariffs by 47%, down to 18.3 million tons annually. Imports exceeding this quota will face a 50% tariff, double the previous 25% rate. These measures will cover 26 categories of steel products. Brussels justified these changes by citing the need to protect the European steel industry from the impacts of global overproduction, dumping practices, and downward pressure on international prices.

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imposing trade restrictions on countries that are not responsible for the world's oversupply does not contribute to finding an effective solution and can provoke an escalation of trade defense measures.