EU cuts steel quotas by 47% and raises tariff to 50% starting today. For the Košice steelworks it's a shield — in three months, Japan's Nippon Steel takes over

The European Union today launched a new regime to protect the steel market: it cut duty-free import quotas by nearly half, to 18.3 million tonnes a year, and raised the tariff on steel imported above the quotas from 25 to 50 percent. The most visible Slovak winner is the Košice steelworks — with over 7,500 employees, one of the largest private employers in the east of the country — which, after years of pressure from cheap imports, is getting a tariff wall. But in exactly three months, on October 1, the same steelworks will pass under Japan's Nippon Steel and change its name to Nippon Steel Slovakia, and a costly transition to an electric furnace is getting under way — one that the tariff alone will not save. SITA ↗

What changes from today

The new regime replaces the safeguard measure from 2018, which expired on June 30. The duty-free quota of 18.3 million tonnes corresponds to the 2013 level and represents a cut of almost 47 percent compared to 2024. Half the quota is reserved for countries with free trade agreements or privileged ties, while the other half remains open to all exporters, with thirteen countries — including the United Kingdom, Turkey, South Korea, India and Ukraine — having already negotiated special access. SITA ↗

The European Parliament approved the rules in May by an overwhelming majority of 606 votes to 16, justifying them by the loss of roughly 100,000 jobs in European steelmaking since 2008. European Parliament ↗ The main backdrop is global overproduction, in which China carries decisive weight — it produces more than half the world's steel and, according to the Commission, subsidizes it massively, while European production fell last year to a record low of 125.8 million tonnes. Trade Commissioner Maroš Šefčovič described the measure as a "careful balance" between trade obligations, World Trade Organization rules and supply diversification, and stressed that it is not aimed against China. SITA ↗ The trigger, however, was Washington: when Donald Trump raised American steel tariffs last year, the surplus production was redirected to European markets. Trend ↗

Why it's a shield for Košice

The Košice steelworks is the largest integrated steel producer in Central Europe, with an annual capacity of 4.5 million tonnes of crude steel. U. S. Steel Košice ↗ Since it melts and casts steel directly in Slovakia, it benefits from the new origin condition — the so-called "melt and pour" rule, meant to make it harder to circumvent quotas through minimal processing of cheap steel in third countries. European Parliament ↗ In other words, the rules reward producers who actually manufacture within the Union, not those who merely repackage cheap steel.

Slovak MEPs from both the coalition and the opposition welcomed the measure across the political spectrum. Ľubica Karvašová of Progressive Slovakia speaks directly of a "shield": "Our steelworks were under enormous pressure from unfair, subsidized competition from third countries. Stricter rules will give them an effective shield they badly needed," she said, adding that thousands of jobs in eastern and central Slovakia are at stake. HN ↗ Branislav Ondruš of Hlas added a more critical tone, noting that Slovak steelmakers, including U. S. Steel Košice, face tariffs of up to 50 percent when exporting to the US, while American firms, in his view, enter the European market without obstacles. HN ↗ A double squeeze — 50 percent on both sides of the Atlantic.

The Japanese pivot and the bet on an electric furnace

The tariff wall arrives just weeks before the steelworks changes owners. From October 1, Japan's Nippon Steel takes full control — having bought the American parent company U. S. Steel last year, it is now reaching directly for its European subsidiary, which it will rename Nippon Steel Slovakia. U. S. Steel Košice ↗ The logic is clear: owning production inside the Union means being behind the tariff wall, not in front of it.

The new owner also inherits a decision that will shape the plant's future — the shift from coke-fired blast furnaces to an electric arc furnace. Instead of the original American plan for two furnaces, the Japanese will, for now, build one, with output of 1.5 to 2 million tonnes a year — nearly half of current capacity. Construction is to begin in 2027, trial operation is planned for late 2029, and the cost will run into hundreds of millions of euros. Korzár ↗ The furnace is meant to cut CO₂ emissions by 56 percent, but it will raise electricity consumption from 1.7 to nearly 2 terawatt-hours a year — a sensitive bill given Slovak energy prices. According to the plant, the decision on a second furnace — and thus on full decarbonization — will also depend on the EU's stance. Denník N ↗

That is the core of a problem the tariff alone does not solve. According to the OECD, the steel sector is in a global crisis of overproduction, and tariffs buy time, not transformation. SME ↗ The Košice shield is necessary but not sufficient. Survival will depend on whether the investment in green steel pays off, which hinges as much on energy prices and European climate policy as on the level of tariffs.

What hotinfo is watching

• October 1: U. S. Steel Košice passes under Nippon's direct ownership and is renamed Nippon Steel Slovakia.
• The Commission's implementing acts on dividing quotas among individual countries, whose publication is still being delayed.
• Nippon's final investment decision on the electric furnace and the fate of the planned second furnace.
• Retaliatory steps by trading partners and quota negotiations within the World Trade Organization.
• The fate of Slovak steel on the American market, since the 2025 EU–US trade agreement does not cover steel and American tariffs remain at 50 percent.
• The energy bill and the impact of EU carbon policy on the competitiveness of the Košice steelworks.