EU Alloy Curbs Threaten to Push Up Costs for Portugal’s Steelmakers

Portuguese manufacturers woke up this week to discover that the raw materials sitting at the heart of every tonne of steel they melt, press or laser-cut are now subject to the most thorough import controls the European Union has imposed in a decade. The new regime, in place since Tuesday, rewrites the rules for bringing ferromanganese, ferrosilicon and related alloys into the single market and, by extension, into Portugal’s own shipyards, car-parts plants and construction sites.

The decision in Brussels, stripped to its essentials

The European Commission has activated a trilogy of measures—tariff-rate quotas, a reference-price floor and a three-year sunset clause—that together aim to drag the bloc’s domestic ferroalloy industry back from the brink. Import volumes will be capped at 75 % of their 2022-24 average, any shipment arriving below a pre-set price trigger will attract an immediate surcharge, and the whole programme is scheduled to expire on 17 November 2028 unless renewed. Officials justified the move by pointing to a 17 % surge in imports between 2019 and 2024 and a collapse in EU market share from 38 % to 24 %.

Why it matters on this side of the Iberian border

Portugal does not smelt large quantities of its own ferroalloys, yet the country’s Seixal steelworks, the Aveiro automotive corridor and the Sines offshore fabrication yards all rely on a predictable flow of these additives to give steel the hardness and corrosion resistance demanded by clients. Any quota breach could force importers to pay a markup that starts at €76 per tonne for ferromanganese and climbs sharply when prices dip below the official reference of €1 316 per tonne. Purchasing managers interviewed by capital-goods trade bodies in Lisbon warn that even a 2 % cost uplift would cascade through energy-intensive production lines already grappling with expensive electricity.

The winners, the losers and the uneasy middle ground

For the 1 800 workers at Europe’s eight operational ferroalloy furnaces—located mainly in France, Spain, Germany and Slovakia—the package is a lifeline. Their employers have lobbied for years, citing Chinese overcapacity and Russia’s pivot toward Asian markets as existential threats. On the other side of the ledger, Norwegian producers, who supply more than 40 % of the EU’s imports, call the quotas discriminatory even though they share the same European Economic Area. Lisbon-based traders, who often buy from Norway via the port of Leixões, fear paperwork delays and higher financing costs. Meanwhile, downstream steel users sit in the middle: they welcome moves that stabilise supply but dread any measure that crimps it too tightly.

Reading the fine print: numbers that shape the next three years

Under the regulation, quarterly quotas are fixed and non-transferable; an unused allowance in February cannot be rolled into May. Annual quantities rise by just 0.1 % a year, a token gesture that analysts at CRU Group call ‘nominal at best’. The reference prices—€1 316 per tonne for ferromanganese, €2 408 for ferrosilicon, €1 392 for ferrosilicomanganese and €3 647 for ferrosilicomagnesium—are pitched above current spot levels, meaning the surcharge is likely to bite sooner rather than later. Imports of silicon metal and calcium-silicon remain exempt, a concession intended to keep Europe’s semiconductor and solar-panel supply chains humming.

What happens next for Portugal’s industrial planners

The Commission has promised an early-stage review if ‘market circumstances change materially’—bureaucrat-speak for another energy shock or a geopolitical surprise. Until then, Portuguese industry must decide whether to diversify toward Brazilian or South Korean suppliers, strike longer-term contracts with European furnaces, or absorb the new tariff risk and hope demand slackens elsewhere in the bloc. The government in Lisbon has yet to signal whether it will offer state-backed credit lines similar to those rolled out during the energy-price spike of 2022. One thing is certain: the price of making a tonne of high-grade steel in Portugal will now depend as much on the quarterly quota dashboard in Brussels as on the global benchmarks published in London and Singapore.