🔗 Share this article

EU officials revealed plans to adopt the United States' steel tariffs, increasing to double levies on foreign steel to fifty percent in a move condemned as "a critical danger" to the sector in the UK.

Unprecedented Crisis for UK Steel Industry

Given that 80% of UK steel shipments destined for the EU, this change creates the UK steel industry's most severe challenge, as stated by the lobby group representing the sector.

European Commission Measures and Rules

In its plan presented to the EU legislature on Tuesday, the EU executive also proposed slashing the current allowance for duty-free imports and obliging foreign suppliers to state where the steel was melted and poured to stop Chinese producers diverting exports through other countries.

EU steel sector faced potential collapse – we are protecting it so that it can invest, decarbonise, and regain competitiveness.

Replacement of Current Framework

These measures are intended to replace a quota system that has been functioning for the past seven years and which is set to expire in 2026 and is now considered not fit for purpose. Inaction could have been "disastrous" for the sector, one EU official stated.

Sector Response and Concerns

Nevertheless, industry representatives, from the industry body British Steel, stated EU doubling its tariffs would pose "the biggest crisis the British steel sector has ever faced".

There were calls for the government to "recognise the urgent need to implement domestic protections to defend" the British steel sector – which is affected by a twenty-five percent duty imposed by the US earlier this year – from the threat of millions of tonnes of world steel redirected from US and European markets.

This surge in foreign steel "might prove fatal for numerous steel companies.

Labor and Political Calls

Union leaders, representative at steelworkers' union Community, stated the proposed changes represented "an existential threat" to UK steel.

Labor and business representatives called on the UK government to begin talks immediately with the EU on country-specific tariff exemptions, pointing out that the United Kingdom was now the European Union's No 1 trading partner.

Broader Context

Sector representatives in the EU have also been warning for several months that their own industry confronts being "eliminated" through the increased duties on American market shipments along with rising energy prices and low-cost Chinese imports.

Steel on both sides of the Channel is considered a foundational industry, supplying elemental components in everything from building frameworks, renewable energy equipment and railways to dishwashers and kitchenware.

Adoption and Next Steps

These proposals must be agreed by EU nations and the EU legislature, with the EU executive head urging member states and MEPs to move quickly in support of the proposal.

Should approval be granted, the EU will cut its current duty-free quota by forty-seven percent to 18.3m tonnes a annually, a level previously recorded in 2013. It will impose a fifty percent tariff on imports exceeding the limit and oblige nations shipping to the EU to state the production origin to prevent circumvention of the sanctions.

Exemptions and International Cooperation

Norway, Iceland, and Liechtenstein will not be subject to tariff quotas or duties due to their close trading relationship in the EEA, the European Union has confirmed.

In addition to these measures, the EU is pursuing a "metals alliance" with the United States to ringfence their national industries from overcapacity.

The European Union must take immediate action, and decisively, before all lights go out in large parts of the EU steel industry and its value chains.