Arab steel's protectionist squeeze: what the Cairo summit data actually shows about trade diversion, semi-finished circumvention and Egypt's shrinking export window

The 19th Arab Steel Summit, held in Cairo on 3–4 November 2026, was not a venue for breaking policy news. But two panels — one on global trade disruptions, one on the markets of Morocco, Algeria, Egypt, Iraq and Syria — together produced an unusually coherent data set on how protectionism is reshaping steel flows into and out of the Arab world. Read together, the numbers describe something more specific than "trade is getting harder": trade is migrating upstream into semi-finished products and sideways into less-defended markets, while producer margins in the defending markets are being squeezed from both ends.

A caveat on sourcing: all figures below come from speaker presentations as reported by SteelOrbis. They are second-hand, mostly unreconciled with official trade statistics, and in at least one case internally inconsistent. Where I have done arithmetic or drawn conclusions, it is flagged as analysis.

The EU's enforcement machine has changed gear

The sharpest disclosure came from Sven de Knop of Sidley, who put numbers on what exporters have felt qualitatively.

Source: de Knop, as reported. The 2016–2024 measures average is my derivation from his statement that 26 is "almost three times" the earlier norm; it is not a figure he stated.

At roughly 2.7 times the previous case rate, the EU ran about 64 investigations across 2024–2025 where the old pace would have produced around 24 — some 40 extra cases in two years (my calculation). The measure count matters more than the investigation count, because a measure is what actually closes a market.

Two methodological shifts behind those numbers deserve more attention than they received in the coverage. First, the use of alternative cost benchmarks in cases involving significant market distortions — the practice of replacing an exporter's reported input costs with external reference values. Second, investigations into subsidies originating outside the exporting country. For Arab producers this is the exposed flank: several build on imported billet, slab or scrap, or on concessional energy and finance from state-linked entities. Both are precisely the kind of inputs that external benchmarking and third-country subsidy scrutiny are designed to reach. A producer can be entirely commercially run and still see its normal value reconstructed upward because its hot metal or its electricity was priced below a Brussels-selected benchmark.

De Knop's forward list — tighter steel import restrictions, a possible CBAM extension to downstream goods, and forthcoming forced-labour and industrial-sustainability rules — suggests the direction of travel is toward product-embedded compliance rather than border duties alone. Lina Abourous of Forward Global made the complementary point: producers typically arrive to adapt to regulations rather than shape them, and the next five to ten years will reward those who engage in Brussels early and via European partners.

The diversion thesis, quantified

Afaf Ezz of Ezz Steel supplied the panel's most useful empirical observation: restrictions in the US and EU are pushing exports toward less-protected destinations, where they land on domestic producers who never asked for the fight. That is textbook deflection, but the number that makes it concrete is elsewhere in her presentation.

EU semi-finished steel imports rose from 6.62 million tonnes in 2024 to 8.91 million tonnes in 2025 — an increase of 2.29 Mt, or +34.6% (my calculation). Against that, total EU steel import volumes were not expanding at anything like that rate. The implication Ezz drew — that semis may be used to circumvent measures on finished products — is plausible and worth testing rather than accepting: rolling slab or billet inside the EU moves the value-add past the customs frontier, and it is the classic route around a product-specific duty.

But circumvention is only part of the explanation. European flat-rolled capacity closures have left the EU structurally short of upstream metallics, so genuine demand for imported slab exists independently of any duty-avoidance motive. The policy problem is that the two are indistinguishable at the border, and both grow when finished-product access tightens. Arab semi-finished suppliers — Egypt, Algeria, and increasingly the Gulf — sit directly in the path of that growth.

Egypt: import protection working, export access failing

The Egyptian data, spanning both panels, exposes a two-track outcome that other Arab producers should study.

Imports (reported by Ezz, 2021–2024): billet imports up 1,213%, HRC imports up 116%. The percentage bases are not given, so absolute tonnages cannot be derived without inventing them.

The correction since (reported by Hassan El Marakby, El Marakby Steel): safeguard measures have cut billet imports to 2.5 Mt, lifting billet capacity utilisation to about 70%. HRC utilisation stands at 96%, with 2026 output expected at 2.2 Mt against consumption of 2.1 Mt — implying a domestic HRC capacity of roughly 2.3 Mt (my derivation).

Longs (El Marakby): rebar production of 8.4 Mt in 2025 against capacity utilisation of about 54%, implying nameplate long-product capacity near 15.5 Mt (my derivation). Rebar consumption is projected at 7.0–7.6 Mt in 2026, up from 6.7 Mt in 2025.

Put simply: Egypt has built enough long-product capacity to supply its own market twice over, has almost fully utilised its flat capacity, and depends on imports for the metallics to feed both. Raw material imports run at $2.8 billion a year, 75% iron ore and 23% scrap.

That structure explains why the export side is so damaging. Ezz reported Egyptian steel exports fell 25% in 2025, an estimated $600 million loss, and that Egyptian HRC exports to the EU will face a quota of roughly 400,000 tonnes under the new EU steel trade regime — about half of previous volumes. That implies prior EU-bound HRC flows of about 800,000 t/yr (my derivation from "around half"). For a country with 54% long-product utilisation and near-full flat utilisation, halving the principal flat export channel is a direct hit to the only segment with spare melt capacity to redeploy.

Ezz also cited Egypt's €7.7 billion trade deficit with Europe in 2025 and called for more balanced terms — a political argument that will carry more weight if Arab producers can present joint positions rather than bilateral grievances.

A data conflict worth flagging

Two speakers gave Egyptian consumption figures that do not reconcile. Ezz put combined rebar-plus-flat consumption at 8.6 Mt in 2025, down from 9.6 Mt in 2015. El Marakby put total steel consumption at about 10 Mt in 2025, easing to 9.9 Mt in 2026. These may differ in product coverage (rebar and flat only versus all steel), in apparent versus real consumption, or simply in sourcing. The summit did not resolve it, and anyone building a demand model on these numbers should treat the 2025 figure as a range of roughly 8.6–10 Mt.

Either way, the direction is unhelpful: a population of over 110 million consuming under 10 Mt of steel is a weak domestic base for 15 Mt-plus of long capacity. El Marakby pointed to planned investment of EGP 3.7 trillion for 2026–2027, 59% private, in housing, energy, irrigation and water infrastructure — the right sectors to lift rebar offtake, but not a quick fix.

The scrap question is the next front

A thread running through both panels deserves elevation: EU restrictions on scrap exports. Morocco sources a significant share of its scrap from the EU and imported about 1.2 Mt of billet in 2025. Egypt's raw material bill is 23% scrap. If Brussels restricts scrap outflows to keep metallics inside the CBAM perimeter, Arab EAF producers face a cost and availability shock at the same time as their finished exports are being quota-constrained. The combination — restricted metallics out, restricted steel in — would be more damaging than either measure alone, and it is the scenario Arab producers should be modelling now.

What actually matters from Cairo

The summit's real message is that protectionism is not reducing trade volumes so much as changing their composition and direction. Three implications follow.

1. Semi-finished is the growth product and the next target. EU semis imports up 34.6% in a year will not go unnoticed in Brussels. Arab billet and slab exporters should expect the current openness to be temporary, and should prepare normal-value documentation and emissions data before a case arrives rather than after.
2. Import safeguards buy time, not competitiveness. Egypt's billet imports at 2.5 Mt and 70% utilisation show safeguards work mechanically. But 54% long-product utilisation and a halving of EU HRC access show the underlying surplus has not gone away — it has been pushed into lower-value markets and semi-finished forms.
3. Regional coordination is the only lever with scale. El Marakby's argument that competitiveness now depends on market access, verified emissions data and energy cost management — not price alone — is the correct framing. Iraq's 44 GW demand against 30 GW supply, Algeria's push to 4.5–5 Mt by 2030, Morocco's scrap dependence and Syria's 30–40% post-rehabilitation production recovery all point to complementarities (metallics, energy, semi-finished supply, reconstruction demand) that bilateral trade defence cases cannot capture.

The uncomfortable conclusion for Arab producers is that the EU's enforcement surge is largely a response to global overcapacity, and no amount of diplomatic engagement in Brussels will change that arithmetic. What engagement can change is whether Arab mills are treated as partners in a restructuring of European supply — supplying slab to EU rollers, documenting emissions early, investing in European downstream assets — or as a residual problem to be quota-managed. The 400,000-tonne HRC quota is the price of not having made that choice sooner.