EU, U.S. to Forge Metals Alliance Against China

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--European Trade Commissioner Maros Sefcovic has confirmed that the European Union (EU) and the U.S. will develop a "metals alliance" to combat the harm that subsidized Chinese producers are having on their respective industries.

Speaking at a recent press conference. Sefcovic said that during the weeks of intense trade negotiations between both sides that yielded the recent EU-U.S. tariff deal, both sides agreed that China was the main issue on the metals front. For additional information, see July 29, 2025, article - Europe Seals 'Last-Minute' Tariff Deal with U.S.. "It became very, very clear that if it comes to steel and metals we are not each other's problem," he said. "The agreement is a clear prospect of joint action on steel, aluminium, copper and the derivatives in what I'd like to call a metals alliance, effectively creating a joint ring-fence around our respective economies through tariff rate quotas at historic levels with preferential treatment."

Right now, European steel and aluminum makers face a punitive 50% tariff imposed by President Trump's administration in June, up from the 25% in place since March. The recent tariff deal failed to solve that issue. There is no actual detail on how exactly the EU and U.S. will tackle the metals tariff problem but the EU has mentioned a plan that revolves around tariffs only being applied when exported steel exceeds a certain quota. Industrial Info is tracking almost 700 steel projects in Europe worth US$50 billion. Subscribers to Industrial Info's Global Market Intelligence (GMI) Project Database can click here for the reports.

Referring to the recent EU-China summit, Sefocovic does not see the problem of overcapacity of cheap Chinese steel exports being resolved any time soon. "I have to say that despite the strenuous efforts of my colleagues and myself and several long meetings with my Chinese counterparts, unfortunately, the list of the accumulated issues on the table will not get shorter, but just grow longer. Clearly the issue is overcapacity. The issue is linked with what we perceive as illegal subsidies."

Europe's steel and aluminium industries have long called for action to deal with the severe damage that cheap imports have caused in their industries and also highlighted how damaging the U.S. tariffs are. Reacting to the recent tariff deal, the European Steel Association (EUROFER), stated: "The deal on tariffs struck by the EU with the U.S. limits the damage in the current circumstances, but the impact on European steel remains dramatic as long as 50% tariffs are still applied. A potential joint action EU-U.S. to address global overcapacity and a possible return to a tariff-rate quota system for EU exports to the U.S., as hinted at by Commission President Ursula von der Leyen, are still vague and lack the necessary details to the bring the economic certainty needed by EU steel producers." Axel Eggert, Director General of EUROFER, added: "If a zero tariff on our traditional exports to the U.S. is confirmed, we would be going in the right direction. But there is no clarity yet. As always, the devil is in the details".

EUROFER figures show that since 2018, the European steel industry has lost 30 million tonnes of steel in the EU internal market and on export markets, due to the effects of global steel overcapacity -- driven by countries from Asia, North Africa and the Middle East -- as well as the effects of U.S. Section 232, and a decrease in steel demand in EU steel using sectors. The effects of the latest additional U.S. tariffs on EU steel applied since March (25%) and June (50%) are "already having a further destructive impact on the sector".

Representing the aluminum sector, European Aluminum stated that the recent tariff deal leaves the aluminum sector "in a state of uncertainty with key challenges still unresolved. We urge the European Commission to provide clarity on what has concretely been agreed for aluminium and when it will take effect. Meanwhile, the current tariff system continues to create harmful arbitrage. Aluminium scrap, which falls under the 15% tariff, can still be exported to the U.S. at a much lower rate than primary and semi-fabricated products. This adds to the already record-level outflow of aluminium scrap to other regions. The EU's main export destinations for aluminium scrap -- India, Malaysia, Indonesia, and China -- have all implemented various export restrictions, placing EU recyclers at a global disadvantage. We only have weeks to get this right."

In March, the European Commission announced an action plan to help its struggling steel and metals industry. The Steel and Metals Action Plan forms a key part of the EU's recently announced Clean Industrial Deal, a 100 billion-euro (US$105 billion) funding plan to boost support for energy-hungry industries that face "high energy costs and fierce and often unfair global competition." For additional information, see March 31, 2025, article--Europe's 'Action Plan' to Rescue Steel Industry.

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).