🔗 Share this article

The European Union have announced they will adopt Donald Trump's steel tariffs, effectively doubling taxes on foreign steel to fifty percent in a decision described as "a critical danger" to the industry in the UK.

Unprecedented Crisis for British Steel Industry

Given that eighty percent of British exports going to the European Union, this change represents the UK steel industry's most severe challenge, according to the industry association representing the sector.

New EU Proposals and Rules

Through its proposal presented to the EU legislature this week, the EU executive also proposed slashing the existing quota for duty-free imports and requiring foreign suppliers to declare the origin of steel production to stop China sneaking products in through other countries.

EU steel sector was on the verge of collapse – we are protecting it so that it can invest, reduce emissions, and become competitive again.

Replacement of Current Framework

The proposals are designed to supersede a import framework that has been in operation for the past seven years and which is set to expire in 2026 and is now seen as outdated. To do nothing could have been "disastrous" for the industry, one EU official said.

Sector Reaction and Warnings

However, industry representatives, from the trade association British Steel, stated Brussels increasing duties would pose "the most severe challenge the British steel sector has encountered".

There were calls for the UK authorities to "recognise the urgent need to put in place domestic protections to defend" the UK steel industry – which is affected by a 25% duty from the US recently – from the risk of millions of tonnes of global steel diverted away from American and EU markets.

This surge in foreign steel "might prove terminal for many of our remaining steel companies.

Union and Government Calls

Alasdair McDiarmid, assistant general secretary at labor union the industry union, said the proposed changes posed "a survival risk" to British steel production.

Unions and industry leaders called on the UK government to begin talks urgently with the EU on nation-specific duty-free quotas, noting that the United Kingdom was now the EU's primary trading partner.

Broader Context

Industry leaders in the European Union have repeatedly cautioned for months that the European steel sector faces being "wiped out" through the increased duties on exports to the US combined with high energy costs and cheap Chinese competition.

The steel industry on in both the UK and EU is described as a essential sector, supplying basic materials in everything from skyscraper structures, renewable energy equipment and transport infrastructure to dishwashers and kitchenware.

Adoption and Next Steps

The new measures require approval by member states and the European parliament, with the EU executive head calling on national governments and European parliament members to move quickly in backing the initiative.

If the plan is ratified, the European Union will cut its existing tariff-free allowance by 47% to 18.3 million tons a year, a level previously recorded in 2013. It will impose a fifty percent tariff on foreign steel beyond the quota and oblige nations exporting into the bloc to state where the steel was melted and poured to prevent circumvention of the sanctions.

Exceptions and International Cooperation

Norway, Iceland, and Liechtenstein will not be subject to tariff quotas or tariffs because of their close trading relationship in the EEA, the European Union has said.

Alongside the proposal, the European Union is seeking a "metals alliance" with the United States to protect their respective economies from excess production.

The European Union needs to act now, and firmly, before all lights go out in significant portions of the European steel sector and its value chains.