Market evolution: Non-alloy steel bars and rods (CN 721499) — 2015–2025

Introduction

This report examines the evolution of EU trade in bars and rods of iron or non-alloy steel, hot-rolled, hot-drawn or hot-extruded (Combined Nomenclature code 721499), covering the period 2015–2025. The product encompasses a range of sub-segments, from low-carbon circular cross-section bars (< 0.25% carbon, various diameters) to higher-carbon variants and square or irregular cross-section profiles, used primarily in construction, engineering, and general industrial applications. The analysis is based on annual trade data from the EU Trade Dashboard.

Over the decade under review, EU trade in CN 721499 underwent a pronounced structural transformation. The bloc's already-negative trade balance widened sharply, driven by the combination of rising import volumes and declining export quantities. This deterioration was underpinned by a dramatic reorientation of supply sources—away from traditional Eastern European and CIS partners and toward Asian and Middle Eastern suppliers—as geopolitical sanctions, cost competition, and shifting industrial capacity reshaped trade flows. At the same time, unit prices rose substantially on both sides of the ledger, reflecting global cost pressures and tighter supply conditions.

The report is organized into three thematic sections: the first addresses the scale and composition of the widening trade deficit; the second examines the geopolitical and geographic reconfiguration of the EU's supply base; and the third analyses price volatility, supply concentration, and their implications for market resilience.

Section 1: A Widening Deficit — Import Growth Outpaces a Declining Export Base

The trade balance deteriorated by nearly 150 % over the period

The EU has been a consistent net importer of CN 721499 products throughout the decade. However, the trade deficit expanded dramatically in both absolute and relative terms.

The deficit's expansion is driven by two reinforcing dynamics: imports grew by €76.4 M in value while exports contracted by €41.4 M. Notably, import volumes rose by 17.6 % even as export volumes fell by nearly half—a divergence that signals a structural loss of competitiveness rather than a temporary demand shock.

Export prices rose faster than import prices, yet exports continued to decline

Unit prices provide an important context for interpreting the volume dynamics:

Export unit values were consistently above import prices throughout the period, suggesting that EU producers served higher-value-added market segments. Yet the export price premium widened from approximately €82/t in 2015 to €262/t in 2025. This widening premium, combined with the halving of export volumes, implies that EU producers increasingly retreated to niche or high-specification markets while surrendering cost-sensitive demand to imports.

Domestic production remained broadly stable but failed to fill the gap

EU production volumes of CN 721499 declined only modestly—from 14.6 billion kg (2015) to 14.1 billion kg (2025), a fall of 3.7 %. Meanwhile, production value more than doubled, rising from approximately €4.0 billion to €8.8 billion (+120.2 %). This indicates a substantial increase in unit production values, consistent with higher energy costs and raw-material input prices experienced across the EU steel sector over the period.

Despite stable domestic output, the trade intensity of CN 721499 (trade as a share of apparent domestic consumption) rose from 15.6 % in 2015 to 19.9 % in 2025 (+27.9 %), while export propensity (exports as a share of production) increased from 6.7 % to 9.6 % (+43.0 %). These rising ratios—despite falling absolute volumes—reflect a shrinking domestic production base relative to the market's openness, underscoring the EU's growing exposure to import competition.

Section 2: Geopolitical Shifts Reoriented the EU's Supply Base Eastward

China and Kazakhstan emerged as dominant import sources, displacing traditional CIS suppliers

The most dramatic change in the EU's import profile over 2015–2025 was the reorientation of supplier geography. The following table summarises the evolution of the top seven import partners by value:

China's share of EU imports surged from €44.5 M to €136.2 M, making it by far the largest single supplier by 2025—a threefold increase. Kazakhstan's trajectory is even more striking in percentage terms: from negligible volumes in 2015, it reached €83.1 M by 2025, becoming the second-largest supplier. The extraordinary volatility of this growth (coefficient of variation of 1.73 for Kazakhstan, the highest among all partners) reflects both the speed of the ramp-up and the low base from which it started.

Sanctions and geopolitical tensions reshaped the CIS trade corridor

The decline of the Russian Federation and Belarus as suppliers aligns closely with the imposition of EU sanctions following 2022. Russian imports fell from a peak of €130.2 M (recorded in the period) to €23.7 M by 2025 (−42.8 % from the baseline). Belarusian imports declined more moderately, from €36.4 M to €27.2 M (−25.3 %), but experienced a complete supply shock in 2023, when a −100 % abnormality was detected—indicating a temporary near-total halt in flows, likely linked to the tightening of sanctions enforcement.

The gaps left by these declining CIS suppliers were filled primarily by China and Kazakhstan. The import concentration HHI nearly doubled from 1,483 in 2015 to 2,930 in 2025 (+97.6 %), indicating a significant increase in supplier concentration. While the HHI remained below the 2,500 threshold typically associated with highly concentrated markets for most of the period, the 2025 reading breaches this threshold—implying that the EU's import base is now substantially more concentrated than at the start of the period.

EU exports contracted sharply to some traditional markets while remaining stable to others

On the export side, the geographic pattern was more mixed:

The collapse of exports to Algeria (−91.5 %, from €30.6 M to €2.6 M) is the most striking single decline. Algeria had been one of the EU's top export destinations in 2015; its near-complete disappearance from the export profile may reflect increased domestic Algerian capacity, competition from third-country suppliers, or the reallocation of EU production toward other markets. The decline in exports to the United States (−70.6 %) may be linked to trade defence measures or competitive shifts in the North American market.

By contrast, the United Kingdom—the EU's single largest export partner—saw a modest increase (+21.7 %), suggesting that the post-Brexit trade arrangement for steel products remained broadly functional. Türkiye and Norway also recorded gains, partially offsetting the losses elsewhere.

Within-EU specialisation is concentrated in a handful of member states

The market structure data reveals a high degree of internal concentration in the EU's production of CN 721499. The most specialised member states in 2025 were:

Bulgaria and Italy together account for over 41 % of EU production in this product category. Meanwhile, countries such as Ireland (RSCA: −1.00), Malta (−1.00), and Greece (−0.93) show negligible specialisation, confirming that production is geographically concentrated in Central and Eastern Europe and parts of Southern Europe.

Section 3: Rising Prices, Persistent Shocks, and Growing Supply-Side Concentration

Unit prices spiked in 2022 and have not fully retraced

Both import and export unit prices for CN 721499 experienced a pronounced spike during 2021–2022, coinciding with the post-pandemic commodity boom, the energy crisis in Europe, and the disruption of supply chains following Russia's invasion of Ukraine:

Import prices peaked at €987.1/t in 2022 (an 85.7 % increase over 2015) before retreating to €604.3/t in 2025—still 13.7 % above the 2015 baseline. Export prices peaked even higher at €1,251.7/t in 2022, and at €866.3/t in 2025 remained 41.1 % above the 2015 level. The slower convergence of export prices back toward baseline is consistent with the EU's higher energy costs, which structurally elevated production costs relative to global competitors.

Sub-product price dynamics reveal divergent cost trajectories

At the sub-product level, the price dynamics varied considerably. For imports:

All sub-products followed the same general trajectory—rising sharply through 2022 and partially retreating thereafter. The higher-carbon variants (72149979, 72149995) consistently commanded premium prices, reflecting the greater processing requirements and more specialised end-use applications.

Import flow concentration increased substantially, signalling reduced supply diversification

The import concentration index (HHI) by value rose from 1,483 in 2015 to 2,930 in 2025—a 97.6 % increase. By volume, the HHI followed a similar trajectory, rising from 1,554 to 3,108 (+100 %). In the framework of standard industrial-organisation thresholds, the import market transitioned from a "moderately concentrated" to a "highly concentrated" structure over the period.

This concentration increase was not mirrored on the export side, where the export HHI by value rose only modestly from 901 to 1,044 (+15.8 %). The asymmetry indicates that the EU's vulnerability on the import side grew far more than its diversification on the export side—a pattern consistent with the dominance of a small number of large Asian suppliers.

Specific partner flows exhibited extreme volatility

The volatility analysis highlights several partner flows with exceptionally high variability (coefficient of variation > 0.6):

• Kazakhstan (imports, CV = 1.73): the highest volatility of any tracked flow, reflecting the rapid ramp-up from near-zero volumes.
• Algeria (imports, CV = 1.60): highly erratic, likely driven by project-based demand rather than steady trade flows.
• United States (exports, CV = 1.84): the most volatile EU export flow, consistent with the dramatic swing from €58.2 M (peak) to €2.3 M (2025).
• Algeria (exports, CV = 1.05): similarly volatile, tracking the collapse from €30.6 M to €2.6 M.

Three specific shock events stood out:

1. Türkiye (exports, 2018): a price shock with a +57.4 % shift and an abnormality score of 17.5, likely reflecting a surge in demand from Turkish construction or infrastructure projects.
2. United States (exports, 2020): a +106.5 % price shift (abnormality 7.9), coinciding with pandemic-era supply disruptions in the US market.
3. Belarus (imports, 2023): a −100 % supply shock (abnormality 3.2), representing a near-complete cessation of flows, consistent with the tightening of EU sanctions on Belarus.

Conclusion

Over 2015–2025, the EU's trade in non-alloy steel bars and rods (CN 721499) underwent a profound structural shift. The trade deficit more than doubled in value terms, driven by the combined effect of growing imports (+17.6 % in volume) and collapsing exports (−49.0 % in volume). This deterioration was not merely cyclical; it reflected deeper competitive and geopolitical forces.

Three dynamics stand out as the defining features of this transformation:

1. A geographic rebalancing of supply, away from traditional CIS partners (Russia, Belarus) and toward Asian producers (China, Kazakhstan), accelerated by the imposition of sanctions in 2022–2023. This reshoring of supply chains toward more distant and, in some cases, more concentrated sources has increased the EU's exposure to trade disruption.

2. A sustained elevation of unit prices, which peaked in 2022 and have only partially retraced. EU export prices remain 41 % above their 2015 level, reflecting structurally higher production costs in the bloc—driven in part by elevated energy prices. Import prices have also risen, albeit more modestly, indicating that even lower-cost suppliers have absorbed some of the global cost inflation.

3. A significant increase in import concentration, with the HHI rising from 1,483 to 2,930 over the period. This shift, combined with the documented supply shocks to key partners, suggests that the EU's supply resilience for this product category has diminished. The growing dominance of China (€136 M, 45 % of imports) and Kazakhstan (€83 M, 27 % of imports) means that policy or commercial disruptions affecting either country would have outsized consequences for the EU market.

Looking ahead, the trends identified in this report suggest that the EU's industrial policy ambitions in the steel sector—including the Carbon Border Adjustment Mechanism (CBAM) and ongoing trade defence investigations—will be decisive in shaping whether the current deficit trajectory stabilises or worsens. The data underscores the urgency of addressing both the competitiveness gap that is eroding EU export capacity and the concentration risk that is building on the import side.