**Title: EU Abandons Aluminium Scrap Duty Proposal Amid India Trade Deal Concerns**
The European Union (EU) has decided to withdraw its proposal for an export duty on aluminium scrap, citing concerns that the measure could hinder the finalization of a free trade agreement with India. This decision, confirmed by sources familiar with the discussions, marks a significant shift in the EU's approach to protecting its smelting industry and supporting sustainability initiatives.
Originally, the EU had planned to introduce a 15% export duty on aluminium scrap for a three-year period, with the intention of preserving the domestic smelting industry amid rising global competition. However, internal negotiations revealed that the draft proposal would only cover half of the aluminium scrap market, leading to its eventual abandonment. The proposal was set to be announced on September 23, but the EU's industry chief, Stéphane Séjourné, opted to halt the measure following discussions that highlighted the potential backlash from India, a key trading partner.
India is a major player in the aluminium scrap market, accounting for approximately one-third of the EU's scrap exports. The Indian government had previously expressed its opposition to the proposed duty, seeking exemptions from the planned restrictions. Sources indicate that pressure from Indian officials contributed significantly to the EU's decision to dilute the measure, with reports suggesting that the proposal had become ineffective for the industry due to the exclusion of India.
EU Commission President Ursula von der Leyen is expected to sign the trade deal with Indian Prime Minister Narendra Modi in December, further emphasizing the importance of maintaining favorable relations with India. The decision to abandon the export duty reflects the EU's balancing act between protecting its domestic industries and fostering international trade partnerships.
In lieu of the export duty, the EU plans to rely on its existing environmental regulations to manage aluminium scrap exports. The Commission announced that it would utilize the Waste Shipment Regulation to achieve similar goals without imposing new tariffs. This regulation, which is expected to be finalized in November, will prohibit the export of non-hazardous waste to non-OECD countries starting in May 2027. However, there are concerns within the industry regarding the effectiveness of these environmental rules in preventing circumvention and ensuring compliance.
Industry representatives have expressed disappointment over the cancellation of the export duty, viewing it as a critical measure to prevent further plant closures and maintain competitiveness against Asian rivals. Emilio Braghi, chief operating officer of aluminium producer Novelis Inc., warned that reversing the decision could undermine confidence in Europe's industrial policy framework. The aluminium sector has faced significant challenges, including soaring scrap prices and higher energy costs, which have placed additional pressure on European smelters.
As the market dynamics shift, the EU has seen a substantial increase in aluminium scrap exports, which rose by 51% since 2019, reaching a record 1.26 million metric tons in 2025. This surge has been attributed to trade distortions and subsidies in third countries, where buyers often pay significantly higher prices than those available in the EU.
Jostein Roynesdal, head of EU public affairs at Norsk Hydro, expressed concern over the withdrawal of the export restriction, noting that the company has already closed four recyclers in the EU in recent years and is eager to avoid further closures. The industry remains skeptical about the effectiveness of the forthcoming Waste Shipment Regulation and its ability to adequately address the challenges posed by rising scrap exports.
Paul Voss, director general at the industry association European Aluminium, acknowledged the need to collaborate with the Commission to navigate the current situation but stressed the importance of revisiting trade measures in the near future to safeguard the industry.
As the EU moves forward with its trade negotiations and regulatory frameworks, the balance between environmental sustainability and industrial competitiveness will remain a critical focus, particularly in light of the evolving global trade landscape. The decision to abandon the aluminium scrap export duty underscores the complexities of international trade relations and the need for strategic policymaking in the face of competing interests.