Nickel prices on the Asian SHFE have seen a continued rise today, increasing by as much as 1.8%. Prices on the European LME also surged by over 1.5% at the start of trading and have since climbed by more than 2.4%, reaching over $15,400 per tonne.

LME Nickel Jumps Over 9% Since Last Week

This increase means that LME nickel prices have risen by more than 9.7% since Thursday, April 9, 2025. This makes reports of stainless steel price cuts, which were circulating earlier today, outdated and irrelevant.

Swiss Steel Mills Reject State Aid?

In the European Union, domestic steelmakers are well-known for their constant demands for state support, whether in the form of financial aid or protectionist measures. Billions of euros have already been pledged or allocated by the EU and its member states to prevent a supposed decline in steel production.

However, in Switzerland, steel mills have expressed reluctance toward taking advantage of the generous state aid for energy costs introduced at the end of 2024. The main issue is that the conditions attached to the aid would infringe on the companies’ entrepreneurial freedom. For instance, environmental requirements must be met in order to access the so-called "bridging aid."

Steel Executives Must Forego Bonuses

A more significant issue is that managers of affected companies would be required to forgo their bonus payments. It raises the question of how quickly state aid can become undesirable when it compromises entrepreneurial freedom—especially when struggling companies, supposedly burdened by high energy costs, reject subsidies because it means managers must sacrifice their bonuses. Could Switzerland's large steel and aluminum producers ultimately fare better without these state interventions?

Could the Swiss Model Be Applied to the EU?

What would happen if the European Union imposed the same conditions on its steel and aluminum plants as Switzerland? Likely, the demand for subsidies and market protection would quickly diminish, as the pressure on “entrepreneurial freedom” would rise. This raises the question: what do these large corporations really have in common with true entrepreneurship?

EU Interferes with Entrepreneurial Freedom, but Not in Steel Mills

As is often the case in European politics, there seems to be a double standard when it comes to “market economy” and “non-market economy” measures. This is clearly evident in two examples. While the European Commission does not restrict the flow of raw materials such as iron ore or ferrous and non-ferrous scrap into the EU, it is aiming to tighten regulations on scrap exports, potentially banning them altogether. This would constitute a non-market intervention, restricting the entrepreneurial freedom of domestic recycling businesses, which include many small and medium-sized companies. Such policies could result in the loss of competition, jobs, and businesses.

Double Standards in EU Economic Policy

At the same time, the Commission aims to regulate the inflow of steel and other products more tightly, through measures like the Carbon Border Tax (CBAM) or tightening the Country of Origin rules to include a “Melted and Poured” component, in an effort to close loopholes and strengthen the EU's trade defense mechanisms. This is particularly true for countries benefiting from non-market conditions and overcapacity, which the EU claims distort global trade.

However, the EU continues to allow raw materials and semi-finished products, such as millions of tonnes of steel slabs, to pass through its borders without hindrance—even from so-called “non-market economy” countries.

EU’s Role in Creating a Steel Market with Non-Market Conditions

The EU’s position as the world’s second-largest steel producer in terms of overcapacity (right behind China) and its implementation of more trade defense measures for steel products than most other countries, have contributed to the creation of “non-market conditions” within the domestic steel market. This only serves to protect a powerful steel oligopoly that has no interest in fostering real market competition.