🔗 Share this article

The European Union declared they will adopt the United States' import duties on steel, effectively doubling levies on foreign steel to fifty percent in a decision described as "a survival risk" to the sector in the UK.

Unprecedented Crisis for British Steel Exports

Given that 80% of British exports destined for the EU, this change creates the British steel sector's most severe challenge, according to the industry association representing the sector.

New EU Proposals and Regulations

Through its proposal submitted to the European parliament on Tuesday, the EU executive also proposed cutting the current allowance for duty-free imports and requiring international producers to state the origin of steel production to stop Chinese producers sneaking products in through other countries.

The European steel industry was on the verge of collapse – we are protecting it so that investments can be made, decarbonise, and regain competitiveness.

Replacement of Existing System

The proposals are intended to replace a quota system that has been in operation for the last seven years and which is set to expire in 2026 and is now seen as not fit for purpose. To do nothing could have been "fatal" for the sector, one EU official stated.

Industry Reaction and Concerns

However, Gareth Stace, from the trade association UK Steel, said EU doubling its tariffs would pose "the most severe challenge the British steel sector has ever faced".

He called on the UK authorities to "recognise the critical necessity to put in place its own measures to defend" the British steel sector – which is affected by a twenty-five percent duty from Trump recently – from the threat of millions of tonnes of world steel diverted away from US and European markets.

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

Labor and Government Pressure

Alasdair McDiarmid, assistant general secretary at labor union Community, stated the proposed changes represented "a survival risk" to UK steel.

Labor and business representatives urged the UK government to begin talks urgently with the European Union on nation-specific duty-free quotas, pointing out that the United Kingdom was now the European Union's No 1 trading partner.

Industry Background

Sector representatives in the EU have repeatedly cautioned for several months that their own industry faces being "wiped out" through the new 50% tariffs on exports to the US combined with rising energy prices and low-cost Chinese imports.

Steel on both sides of the Channel is described as a essential sector, providing elemental components in everything from skyscraper structures, renewable energy equipment and railways to dishwashers and cutlery.

Adoption and Future Actions

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

If the plan is ratified, the EU will cut its existing tariff-free allowance by 47% to 18.3m tonnes a annually, a level last seen in 2013. It will impose a fifty percent duty on imports beyond the quota and require nations shipping to the EU to declare where the steel was melted and poured to prevent circumvention of the measures.

Exceptions and International Cooperation

These European nations will not be subject to tariff quotas or duties because of their close trading relationship in the European Economic Area, the EU has said.

In addition to these measures, the European Union is pursuing a "steel partnership" with the United States to ringfence their respective economies from excess production.

The European Union needs to act now, and firmly, prior to operations cease in significant portions of the European steel sector and its supply networks.