Malaysian steelmakers call for fair trade in the wake of EU measures

The country has received just one individual quota from the European Union out of 26 product categories

The Malaysian Iron and Steel Industry Federation (MISIF) is concerned about the rise in trade barriers in key export markets and is calling for fair treatment of Malaysian steel as the industry grapples with global overcapacity. According to forecasts, the global steel surplus is set to rise from 602 million tonnes in 2024 to 721 million tonnes by 2027, which is almost five times the annual demand in the EU. This is stated in a MISIF press release.

The federation emphasised that it respects the EU’s right to implement safeguard measures in accordance with WTO rules, but Malaysian producers should not suffer as a result. Malaysia has always exported its products in moderation and has never been the cause of the sharp rise in imports that these restrictions are intended to tackle.

MISIF noted that the new EU tariff quotas, which came into force on 1 July 2026, are based on data from 2022–2024. During this period, the country’s companies were recovering from the COVID-19 pandemic or were only just entering the markets, so the volumes of exports do not reflect the sector’s true potential. Under the new rules, Malaysia has been allocated an individual quota for only one of the 26 product categories — non-alloy and other alloy wire rod. In other categories, exporters are forced to compete within the general quota pool, and a 50 per cent duty (twice the previous rate) applies to shipments exceeding the quota. As the country does not have a free trade agreement with the EU, it is denied more favourable terms.

Apart from Europe, barriers are also rising in other markets. In the US, a 50 per cent tariff applies to Malaysian steel (under Section 232), whilst in Mexico, exporters face obstacles regarding registration and classification, despite the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) being in force.

The steel industry is the cornerstone of Malaysia’s economic security, providing hundreds of thousands of jobs. The Federation stands ready to support the government’s efforts to protect the sector’s interests, particularly during the free trade negotiations with the EU (MEUFTA), which are scheduled to be concluded in 2027.

As reported by the GMK Centre, Ukraine faces one of the largest reductions in tariff quotas under the new European quotas. The country’s annual losses from steel exports could reach 1.3–1.6 million tonnes.