Sept 22 (Reuters) - At least a third of surveyed

companies have paused or delayed stainless steel orders because

of U.S. import tariffs of up to 50%, while more than half are

reassessing their sourcing strategy, Finnish steelmaker

Outokumpu said on Monday.

Outokumpu President and CEO Kati ter Horst told Reuters the

slowing global demand means current European Union import quotas

are too high, and that she expects the European Commission to

announce in October measures to curb imports of steel from

rivals to protect domestic producers.

The measures will replace current safeguards due to end next

summer and might come into effect even a quarter earlier, she

added.

WHY IT MATTERS

A third of businesses switched steel suppliers as of May, while

the addition in August of hundreds of derivative products to the

U.S. list of goods subject to the levies created uncertainty for

equipment and machinery buyers, ter Horst said.

Outokumpu operates the only mine in Europe and North America

that extracts chromium, a critical mineral used in stainless

steel and exempted from U.S. tariffs.

It has developed a low-emissions alloy containing 99%

chromium, compared with 53% previously, and plans to scale up

production to one ton a day in an upcoming pilot plant, from one

kilo currently, ter Horst said.

CONTEXT

EU lawmakers expect import quotas and the CBAM mechanism,

imposing costs at the EU border on the CO2 emissions embedded in

imported steel to help decarbonisation, after green steel

projects around Europe have been delayed or canceled due to

worsening demand and high energy costs.

Ter Horst said that long term stainless steel trends remain

positive as buyers, hoping to reduce a combined $2.5 trillion a

year in corrosion costs and meet climate targets, see the

material as more sustainable and stronger than normal steel.

Growing defence spending also supports the trend, she said.