“The United States and the European Union on Sunday ended a dispute over steel and aluminum tariffs and said they would work on a global arrangement to combat ‘dirty’ production and overcapacity in the industry,” said Reuters.
The news also cites the positive development as a challenge for China as it produces over 50% of the global steel and is accused of creating overcapacity, which in turn challenges the survival of the EU and the US steel.
The United States will not apply Section 232 duties imposed by former President Donald Trump and will allow duty-free importation of steel and aluminum from the EU at a historical-based volume.
The EU will suspend tariffs on U.S. products like whiskey, power boats and Harley-Davidson motorcycles, imposed in retaliation for the steel and aluminum tariffs.
The two sides said they will work to restrict access to their markets for "dirty steel" and limit access to "countries that dump steel" in their markets, both of which contribute to worldwide oversupply.
The United States also published a consultation that brought on board what it called "like-minded nations" like Japan and Britain on issues related to steel and aluminum, with a focus on the impacts of overcapacity on the global steel and aluminum markets.
The news offers a positive start to the market’s risk appetite as the S&P 500 Futures rise 0.30% by the press time of early Monday morning in Asia.
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