Groups representing steelmaking companies in Europe have called on Brussels to enact new measures to curb a glut of Chinese imports that are threatening to undermine domestic production in the EU.

According to the Financial Times (FT), they are warning that a surge in cheap steel imports has pushed prices down to below the cost of production, threatening the future viability of the industry unless steps are taken. This year, Chinese companies are expected to export more than 100 million tons of the metal to the EU, the largest figure since 2016.

Trade groups have therefore called on the European Commission (EC) to enact a comprehensive system of tariffs similar to those proposed on the import of electric vehicles (EVs) in order to tackle the issue of overcapacity in European markets.

A spokesperson for German steelmaker Salzgitter told the FT: "The Commission needs to take bold measures such as a tariffication scheme to tackle the root causes of the problem, which are huge excess capacities in China and other countries.”

Meanwhile, Axel Eggert, director-general of trade body Eurofer, added that existing safeguards have become ineffective and are no longer able to absorb the volume of imports.

Several other countries have already taken steps to protect steel markets against imports. In July, the US introduced a 25 per cent duty on any steel coming from Mexico that had not been melted and poured in North America, as part of efforts to prevent importers from using its free trade agreement with its southern neighbor to bypass existing tariffs on direct imports from China to the US.

However, a trade official in Brussels told the FT there is currently little appetite for further escalation of trade disputes with China while the EC is already working to get member states to approve proposed EV tariffs.