The EU steel industry has faced a sharp drop in demand this year as coVID-19 has swept across Europe.The move comes as the EU steel industry prepares for a possible breakdown in negotiations between Britain and the EU over a future trade deal.The two sides resumed talks in London on Tuesday in an attempt to strike a last-minute trade deal, less than 10 weeks before Britain leaves the European Union.

Officials at Eurofer, the European steel industry association, say Brexit remains a threat as it is likely to end up with a no-deal situation.The impact on industrial activity, particularly in the automotive sector, was greatest, with steel demand falling by 20.6 per cent.Eu steel consumption will fall by about 14.6 per cent this year.

Apparent crude steel demand, a measure of steelmakers’ output plus imports minus exports, fell 25.5 per cent in the second quarter, the biggest drop on record.Steel demand is expected to rebound by 13.1 per cent in 2021, but the timing of recovery is uncertain because of the second outbreak.

While imports have fallen in line with falling demand, Europe has reiterated its call for tougher “protective” measures from the EU amid fears that rising production elsewhere, particularly in China, will lead to a future surge in exports.