Environment and Energy

SMA cheers extension of US-EU talks on CO2 emissions in steel, aluminum

Written by Ethan Bernard

The Steel Manufacturers Association (SMA) praised the US and EU for extending negotiations around the proposed Global Arrangement on Sustainable Steel and Aluminum.

“The extension will allow the EU to do a reset and remember what the original goals of the arrangement were,” SMA President Philip Bell said at a press conference on Thursday, noting that the primary goal was “sustainable steelmaking.”

The press conference coincided with the winter meeting of the SMA board of directors in San Antonio, Texas.

A central sticking point in negotiations is the carbon border adjustment mechanism (CBAM) proposed by the EU, which is viewed by many in the US as a non-starter.

“CBAM was made by bureaucrats in Brussels rather than focusing on the emissions of certain products,” Bell said. He also emphasizing that the US steel industry is the cleanest in the world thanks to 70% of its output coming from EAF steelmakers.

The Biden administration extended until Dec. 31, 2025, the tariff-rate quotas (TRQs), or soft quotas, in place for steel and aluminum imports from the EU. Recall that the TRQs in 2021 replaced blanket Section 232 tariffs of 25%.

Bell said the extension allowed the EU to avoid 232 tariffs. It also helped the US avoid potential retaliatory tariffs by the EU on US-manufactured products.

“They agreed to keep talking on this issue and kind of recalibrate,” Bell said.

Bell also noted that extension would “allow the ITC emissions investigations to play out.”

The US International Trade Commission (ITC) has begun a fact-finding investigation on greenhouse-gas emissions in steelmaking at the request of US Trade Representative (USTR) Katherine Tai. The investigation will look at the carbon intensity of more than 50 categories of steel products and allow for more accurate global comparisons. The commission will submit a report to the USTR by January 2025.

“The fact that we don’t have a deal now doesn’t mean we won’t have a deal,” Bell said. “We have to let this play out.”

Also addressed at the press conference was Nippon Steel’s buy of U.S. Steel, and the scrutiny the deal is under. “We welcome any company that is committed to a lower carbon future for steel,” Bell said.    

The press conference also featured Ty Garrison, SVP of operational and commercial excellence at Irving, Texas-based EAF long products steelmaker CMC. Garrison, who is also chairman of SMA, covered trade, decarbonization, sustainability, and infrastructure investment.

Ethan Bernard

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