A report by Ezz Steel expects Egypt’s consumption of iron and steel to grow in the medium term, as a result of several factors, most notably the liberalization of the pound’s exchange rate, which took place on March 6, 2024, and the new economic measures that were taken, as well as the implementation of new construction legislation.
However, the report pointed out the three most prominent challenges facing the steel industry in Egypt, the most notable of which is firstly the absence of preventive measures of trade protection to support the Egyptian industry, similar to what most steel-producing countries apply, which encourages unfair competition. For example, the United States of America applies tariffs. Protection amounts to 25% on billet imports. This tariff in the main producing countries amounts to 17% in Turkey, 12% in Saudi Arabia, and 11% in Algeria. Vietnam and South Africa each apply a 10% customs tariff, while Egypt does not apply any protectionist or protectionist tariff. Customs duties on pallets.
During the first quarter of 2024, rolling mill companies, with the availability of foreign currency, began to maximize the import of steel squares (billets), and this represents the last stage in the rebar industry, and represents only about 10% of the added value compared to the full production that begins with sponge iron.
The second challenge is the rise in imports of flat steel (HRC) from 145 thousand tons in the first quarter of 2023 to 175 thousand tons in the first quarter of 2024, an increase of 21%. This is due to the almost complete absence of any restrictions on imports, while the European Union imposes a duty 25% on its imports of flat steel if predetermined quantities or quotas are reached.
The United States also imposes dumping and protection duties totaling 66% (41% dumping duties on certain countries, and 25 protection duties), and in Turkey the customs tariff reached 15% in addition to 9% dumping duties on certain countries, and Brazil imposes a customs tariff of 25%. While Saudi Arabia, Algeria, Malaysia, India, and Indonesia each impose customs duties of 10%, while in Egypt, the customs tariff on flat steel is only 5%.
The third challenge is that exports face additional trade barriers, including, for example, the new, more stringent quota system in the European Union. The lack of reciprocal treatment restricts and hinders the Egyptian industry, while the heavy flow of products imported into Egypt, whether square steel (billet) or flat steel ( HRC).
