Market evolution: Steel semis (CN 7207) — 2015–2025

Introduction

This report examines the evolution of EU trade in customs code 7207 — semi-finished products of iron or non-alloy steel — over the period 2015–2025. The product heading covers a range of semi-finished steel forms, including slabs, billets, and blooms of varying carbon content and cross-sections. These products sit at an early stage of the steel value chain: they are the intermediate inputs that downstream rolling mills and forges transform into finished flat and long products.

Over the decade under review, the EU steel sector has been buffeted by a succession of structural shifts — from the commodity price cycle and the COVID-19 shock to the geopolitical upheaval triggered by Russia's invasion of Ukraine and the subsequent sanctions regime. Three dynamics stand out in the data: (1) a widening trade deficit amplified by the commodity price cycle; (2) a radical reshuffling of import origins away from traditional suppliers; and (3) a steady erosion of domestic production capacity, with net import reliance more than doubling. The following sections develop each of these themes in turn.

1. A Widening Trade Deficit Amplified by the Price Cycle

The EU's structural shortfall in steel semis has deepened

The EU has been a consistent net importer of steel semis throughout the period. In 2015, imports were valued at €2,817 million against exports of only €276 million, yielding a trade deficit of €2,541 million. By 2025, imports had reached €4,091 million and exports €607 million, widening the deficit to €3,483 million — a deterioration of 37.1%. At its worst (during the 2021–2022 price spike), the deficit reached approximately €4,605 million.

Price inflation explains much of the value increase

A striking feature of the decade is the divergence between volume and value trends. Import volumes grew by only 8.6% over the period, yet import value rose by 45.2% — implying that price increases accounted for the bulk of the value expansion. Average import prices ranged from a low of €306/t to a peak of €710/t, reflecting the global steel price cycle that crested in 2021–2022. On the export side, the same pattern holds: volumes rose 52.7% but value surged 120.0%, with export prices peaking at €829/t. The commodity super-cycle thus magnified the headline deficit even where underlying physical trade flows were comparatively stable.

EU member states show divergent import trajectories

Italy is the EU's largest importer of steel semis, accounting for imports of €1,544 million in 2025 (up 44.7% from €1,067 million in 2015), reflecting its large downstream steel-consuming industry. Several Central and Eastern European members saw dramatic growth: Czechia's imports rose from €78 million to €513 million (+557%), and Poland's from €51 million to €419 million (+717%). Bulgaria also more than doubled its intake. By contrast, France's imports declined from €213 million to €155 million (−27.2%), suggesting either reduced downstream demand or a shift toward domestically sourced semis. On the export side, Romania emerged as the EU's leading exporter, growing from €50 million to €239 million (+377%), while the Netherlands surged from €23 million to €113 million (+396%).

2. Sanctions, War, and the Remapping of Import Origins

Russia and Ukraine — once the EU's dominant suppliers — have been displaced

At the start of the period, Russia and Ukraine together accounted for roughly €1,811 million in EU steel semi imports — approximately 64% of the total. Russia was the single largest supplier at €1,050 million, followed by Ukraine at €761 million. Russia's share peaked at an estimated €2,618 million before EU sanctions in mid-2022 curtailed trade. By 2025, Russian imports stood at €1,627 million (+55.0% versus 2015), suggesting that while sanctions constrained flows, significant volumes continued to reach the EU through indirect or transitional arrangements. Ukrainian imports, by contrast, fell to €434 million (−43.0%), reflecting the devastating impact of the war on Ukraine's industrial infrastructure.

New Asian suppliers have surged, but with greater volatility

The most dramatic shift has been the rise of Asian suppliers. Chinese imports grew from €98 million to €715 million (+626.7%), while Vietnamese imports surged from essentially zero to €312 million. India also grew substantially, from €30 million to €113 million (+272.4%). These three countries now collectively represent over €1,139 million in EU imports — a presence that barely existed a decade ago.

However, the volatility data reveals an important caveat. Russia's coefficient of variation (CV) was just 0.11 — the lowest among major suppliers — reflecting the stability of established pipeline trade. By contrast, China's CV stands at 1.29 and Vietnam's at 1.17, indicating highly volatile supply patterns. India's CV (0.44) and Brazil's (0.60) are intermediate. The EU has thus traded stable but geopolitically risky suppliers for more volatile alternatives. A price shock event was detected in Chinese imports around 2017, with a 125.5% price shift and an abnormality score of 19.0.

The United Kingdom's collapse as an import source (from €306 million to €44 million, −85.7%) stands apart from the geopolitical drivers and is more likely linked to Brexit-related trade friction and the reorientation of UK steel exports.

EU exports have pivoted toward North America

On the export side, the most notable development has been the extraordinary growth of shipments to the United States — from €6 million in 2015 to €216 million in 2025 (+3,449%). Exports to Canada also surged from €1.4 million to €24.8 million. Together with sustained exports to Morocco (€68 million, roughly stable) and a significant increase to the United Kingdom (from €44 million to €148 million, +237.5%), the EU's export geography has shifted decisively toward Atlantic markets. Meanwhile, exports to Türkiye fell from €40 million to €17 million (−58.1%) and those to Mexico from €59 million to €16 million (−72.8%).

3. Shrinking Output and the Doubling of Import Dependence

EU production of steel semis has contracted sharply in volume terms

Data on EU domestic production reveals a significant decline. Output fell from 17,258 million kg (approximately 17.3 million tonnes) in 2015 to 13,183 million kg (13.2 million tonnes) in 2025 — a contraction of 23.6%. At its trough (likely during the COVID-19 downturn), production dipped to just 10,216 million kg. In value terms, however, production rose from €4,524 million to €6,774 million (+49.7%), as higher steel prices offset the volume decline. The peak production value of €9,687 million — likely occurring in 2022 during the global price spike — underscores the magnitude of the price cycle.

Germany dominates EU steel semi production specialisation, accounting for 40.3% of EU output with a revealed symmetric comparative advantage (RSCA) of 0.31. Slovakia (RSCA 0.41, 5.1% of output) and France (RSCA 0.19, 11.6% of output) are also specialised producers. At the other end of the spectrum, smaller member states such as Cyprus, Malta, Latvia, and Bulgaria have negligible or no production capacity.

Net import reliance has more than doubled

The combination of stable-to-growing imports and declining domestic production has driven a sharp increase in the EU's net import reliance. This indicator rose from 11.6% in 2015 to 27.3% in 2025 (+134.4%), peaking at 32.8% at the height of the import surge. Similarly, trade intensity — the share of trade in total market size — rose from 18.9% to 30.8% (+62.4%). Meanwhile, export propensity — exports as a share of production — declined from 4.6% to 2.8% (−37.7%), indicating that the EU has become less competitive as an exporter of steel semis relative to its own output base.

Import diversification improved, but export concentration increased

The Herfindahl-Hirschman Index (HHI) for imports declined from 2,423 to 2,147 (−11.4%), moving from "highly concentrated" into the "moderately concentrated" range. This reflects the shift away from Russia-Ukraine dominance toward a broader supplier base. By contrast, the export HHI rose from 1,451 to 2,105 (+45.0%), crossing from "unconcentrated" into "moderately concentrated" territory — a consequence of the growing weight of US-bound shipments. The EU's export profile has thus become more dependent on a single destination, even as its import base has diversified.

Looking at product sub-segments, imports are overwhelmingly dominated by sub-code 720712 (wide rectangular low-carbon slabs), which accounts for approximately 73% of import volume in both 2015 and 2025. The composition has shifted, however: imports of 720720 (higher-carbon semis) collapsed from 713,000 tonnes to 194,000 tonnes, while 720711 (square/narrow rectangular) grew from 1,452,000 to 2,120,000 tonnes. On the export side, the EU increasingly ships 720719 (circular and other cross-sections), which rose from 148,000 to 381,000 tonnes and now accounts for 38.8% of export volume — a product category that is negligible in imports (1.5%), suggesting the EU occupies a specialised niche in non-standard semi-finished forms.

Conclusion

The decade 2015–2025 transformed the EU's trade position in steel semis from one of moderate import dependence into a structurally deeper reliance on foreign supply. Three forces drove this evolution.

First, the commodity price cycle amplified trade values far beyond what underlying volume shifts would suggest. Import volumes grew only 8.6%, but prices pushed the import bill up by 45.2% and the deficit to €3,483 million.

Second, geopolitical events — principally EU sanctions on Russia and the war in Ukraine — upended the EU's traditional supply map. Suppliers that once offered stable, low-volatility flows have been partially replaced by newer, more volatile sources in Asia. China, Vietnam, and India have rapidly gained market share, but their combined coefficient of variation far exceeds that of the Russian supply they are supplementing.

Third, EU domestic production contracted by nearly a quarter in volume terms, even as its value rose on the back of higher prices. Net import reliance consequently more than doubled, from 11.6% to 27.3%, while the EU's capacity to export its own semis has weakened. Import diversification has improved modestly, but the concentration of EU exports on the US market introduces a new axis of vulnerability.

Looking forward, the sustainability of the EU's steel semi trade position will depend on whether domestic production stabilises, whether new supplier relationships mature into lower-volatility channels, and how trade policy — including the EU's Carbon Border Adjustment Mechanism — reshapes the competitive landscape for carbon-intensive semi-finished steel products.