EC steel prices and imports: impact of imports from Eastern Europe

As might be expected, steel product prices fell during the recession of the early 1990s. Between 1990 and 1992, steel prices fell by about a third. As the economies of the EC recovered from the recession from early 1993, steel prices rose but by mid‐year it was clear that the increase was much below what was expected. It soon became clear that expected price rises were being mitigated by rising imports from Eastern European countries. This paper considers the process of steel price determination in the EC and the effect of cheap imports on EC prices. It shows that unregulated and relatively cheaper imports from the Former Soviet Union and Central and Eastern European countries indeed had a more depressing effect on EC prices by raising supply than would have been the case otherwise.