US Senators Hit Back at Proposed EU Scrap Restrictions
March 7, 2023
Three US senators have asked the US Trade Representative to engage with the European Union on proposed measures that would limit the trade of steel scrap.
Thom Tillis (R., N.C.), Joe Manchin (D., W.Va.), and Todd Young (R., Ind.) wrote a letter to USTR Katherine Tai on Feb. 28. The letter outlines the potential fallout to the US steel industry if the European Commission’s “Waste Shipment Regulations” are adopted.
“Should they become law, the proposed revisions would negatively impact the global competitiveness of American steel producers through unwarranted restrictions on the trade of steel scrap,” the letter said.
The EC’s Waste Shipment Regulations would restrict EU exports of steel scrap to both member and non-member countries of the Organization for Economic Cooperation and Development (OECD).
The senators noted that the EC’s proposal also likely violates EU obligations before the OECD and the World Trade Organization (WTO).
“While the proposal ostensibly seeks to further environmental goals, it fails to meaningfully distinguish between problematic (e.g., plastics) and non-problematic (e.g., steel scrap) waste,” the senators wrote.
Further, the senators said the EC proposal would also establish “burdensome” monitoring and reporting requirements for scrap exports. They added that such measures would “distort” global scrap markets and steel supply chains, “increasing costs and reducing the supply of scrap for American steel producers.”
Rather than aiding the environment, the senators warned that the measures could actually have the opposite effect.
“In fact, by distorting global scrap flows, the proposal would likely lead to higher global greenhouse gas emissions,” the letter said.
They contended that the EC’s proposal appears to be a form of “protectionism for EU producers, who are 37% more carbon intensive than American producers.”
This comes in part from the US’ greater usage of greener electric-arc furnace (EAF) technology. However, this also makes US mills more reliant on the flow of prime scrap to feed EAF sheet mills in particular.
And as far as steel scrap is concerned, their position was clear. “Since steel scrap is not a problematic waste, it should be excluded entirely from these measures,” they said. “Alternatively, the restrictions should be lessened, a sufficient transition period adopted, and a self-certification mechanism established based on an international standard.”
By Ethan Bernard, ethan@steelmarketupdate.com