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EU to increase tariffs by 50% on steel imports and reduce steel import quotas

A source familiar with the details said that on Wednesday, the European Commission would propose reducing steel import quotas almost in half and increasing duties on volumes exceeding these levels to 50%. This is in line with tariffs levied by Canada and the United States.

These measures will form part of a package that is set to be unveiled officially on October 7th. Stephane Sejourne - the executive vice president of the Commission for industrial strategy - briefed steel association on Wednesday in advance of next week's announcement.

The current steel safeguards of the EU will expire next June. The EU and its Western allies try to limit the overcapacity created by Chinese steel factories and other sectors that are subsidized.

The EU has already tightened its current steel import quotas to 15% as of April 1. In addition, the Commission is examining market trends in order to determine potential aluminum safeguards and export duties on scrap.

Steel was thrust into the spotlight at the beginning of this year, after U.S. president Donald Trump raised tariffs on steel and aluminum imports from abroad to 50%.

After reaching a general agreement on trade with Trump late in July, the EU announced that it would work closely and in an "alliance" with Washington to protect their respective productions from China. The U.S. still charges a 50% export tax on European steel.

Maros Sefcovic, EU Trade Commissioner, met U.S. trade representative Jamieson Greer earlier this month in Asia to restart the talks. EU sources had previously said that the new safeguards were a starting point for negotiations with Washington. (Reporting and writing by Julia Payne, Inti Landauro, Editing by Benoit van Overstraeten Philip Blenkinsop Jan Harvey).

(source: Reuters)