Australian steelmakers are being undercut by cheaper imports of fabricated steel products, partly driven by European Union tariffs to reduce low-cost steel imports into Europe and protect its steel industry. This was a direct response to the United States’ tariffs on steel, implemented to reduce steel imports into the US and ostensibly protect its steel fabrication capacity.
The Australian Steel Institute (ASI) has urged the federal government to implement emergency trade relief measures for the industry in response to a surge of lower-cost imported fabricated steelwork.
The Institute has submitted a safeguard application seeking temporary provisions to protect domestic steelmakers.
The application cites a crisis of import penetration, putting the Australian fabricated structural steel industry at risk.
ASI Chief Executive Officer Mark Cain, who heads the 700-member strong industry group, said the industry was at a critical juncture, facing an unprecedented increase in imports that threatened the viability of Australia’s domestic manufacturing capacity.
He also noted that over a dozen steel fabrication businesses in western Sydney have closed in the past 18 months due to heightened competition from low-priced fabricated structural steel imports.
However, the ASI has estimated the national impact was at least three to four times greater.
Specific examples provided by the Institute include a family-owned and operated business in southwestern Sydney experiencing a significant decline in fabricated steel sales. As a result, the capacity utilisation of its manufacturing facility has dropped to 27 per cent, down from 90 per cent three years ago.
Other examples include a Queensland-based steel fabricator, which has incurred progressively worsening operational losses such that over the two years to 2025, it has made 35 per cent of its workforce redundant.
A Victorian-based business has also experienced a $22 million decline in sales revenue between 2024 and 2025 due to competing imports.
The collapsing sales revenue has left the business of 25 employees critically assessing its ongoing viability.
The ASI’s safeguard application argued that implementing measures would enhance productivity within the Australian industry by preserving essential manufacturing capabilities, protecting employment, and maintaining competitive market conditions, all while minimising adverse effects.
The Institute said the measures would also prevent the erosion of critical steelmaking assets, support Australia’s sovereign manufacturing capability for critical defence projects, and help maintain and enhance a skilled Australian workforce by supporting apprenticeships and advanced fabrication trades.
In the month before the ASI lodged its application, the steel industry learned the exact value of a new tariff on steel imposed by the European Union, following the United States’ decision to double its steel tariffs against Europe.
The duty would apply only after the EU reduced its steel import quota by 47 per cent from 2024 levels to 18.3 million tonnes a year.
Cain pointed out that only the size of the tariff was news and that it was a plan yet to be ratified.
He said: “We will work with the Australian government to ensure the best possible outcome for the Australian steel industry.”
Cain explained that the local industry is facing challenges on multiple fronts, with tariffs from the US, Canada, and now the EU likely leading to trade diversion.
Additionally, the cumulative effect of tariffs across markets is exacerbating the excess global steel supply issue.
He added that the sales prospects for Whyalla are likely to be affected by the recent tariff developments, should these have an impact on Whyalla’s market access.
The EU’s new tariff plan needs to be approved by a majority of its 27 member states and the European Parliament before it can come into effect next year.
Eurofer, the European Steel Association, said the tariff plan was fully World Trade Organisation-compliant – unlike US steel tariffs on the EU – and was needed to protect the industry “from unfair imports flooding the EU market” due to a global oversupply.
Eurofer continued: “This quota is set in line with 2013 market conditions before the first wave of Chinese steel flooding, at over 18 million tonnes of tariff-free steel – an amount almost equivalent to the combined steel production of France, Belgium, and Luxembourg.
“Only unsustainable imports above quota levels will be subject to a 50 [per cent] tariff to avoid further import deflection towards the EU, with regular revisions to ensure quotas remain aligned with market conditions in the coming years.”
Despite the uncertain outlook, there is growing momentum in the industry for green steel as the burgeoning sustainability-focused sector transitions from pilot projects to commercial-scale production.
Emerging technologies are further underscored by steelmakers contending with mandatory ESG reporting and an accelerating rate of decarbonisation.
The most advanced green steel proponent in Australia is Green Steel of WA (GSWA), a manufacturer with government and industry support that is progressing two major projects.
The primary focus is GSWA’s $400-million green steel recycling mill in Collie that will use an electric arc furnace powered by renewable energy to convert scrap steel into rebar, with a capacity to produce up to 450,000 tonnes annually when production starts next year.
It received construction approval in April and is expected to generate $450 million annually for the state once operational.
The second project is a $2.5-billion direct reduced iron (DRI) plant near Geraldton that will convert WA’s iron ore into green (DRI) for export, featuring technology that allows initial energy to be supplied by natural gas before transitioning to green hydrogen.
Peter Newman, Professor of Sustainability at Curtin University and author of the recently published book Net Zero Cities with Sustainability: A Practitioner’s Approach, expressed confidence that green iron would be possible in the next three years and green steel in five.
He emphasised that the key was renewable energy and noted this was getting cheaper every year.
Prof Newman continued: “The processes for green iron and steel are mostly about electric processes based on electric arc furnaces – these are now being trialled.
“The mining companies exporting iron ore are all in the process of trying to get ahead of global markets by showing that the green iron and green steel options are easier to do near where the iron is mined.
“It’s only the fossil fuel companies that are now trying to show that such matters can’t be done here.
“We don’t need cheap labour, just the best technology and trained people to manage [it] – [and] we have both.”