🔗 Share this article

EU officials declared plans to match Donald Trump's steel tariffs, effectively doubling levies on foreign steel to 50% in a move described as "a survival risk" to the sector in the UK.

Unprecedented Crisis for British Steel Industry

Given that 80% of British exports destined for the EU, this change creates the UK steel industry's biggest ever challenge, according to the lobby group representing the industry.

New EU Proposals and Rules

Through its proposal presented to the European parliament on Tuesday, the European Commission also proposed reducing the existing quota for tariff-exempt steel and requiring foreign suppliers to declare where the steel was melted and poured to stop China diverting exports through third nations.

EU steel sector faced potential collapse – these measures safeguard it so that investments can be made, decarbonise, and regain competitiveness.

Replacement of Existing System

The proposals are designed 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 considered ineffective. Inaction could have been "disastrous" for the industry, a European official said.

Industry Reaction and Warnings

However, Gareth Stace, from the trade association British Steel, said EU increasing duties would create "the biggest crisis the UK steel industry has encountered".

There were calls for the government to "acknowledge the critical necessity to implement its own measures to protect" the British steel sector – which is still reeling from 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 flood of imports "could be terminal for numerous steel companies.

Union and Political Calls

Union leaders, assistant general secretary at steelworkers' union the industry union, said the proposed changes represented "an existential threat" to British steel production.

Labor and business representatives urged the UK government to start negotiations immediately with the European Union on country-specific duty-free quotas, pointing out that the United Kingdom was now the European Union's primary trading partner.

Industry Background

Industry leaders in the EU have repeatedly cautioned for months that the European steel sector confronts being "eliminated" through the new 50% tariffs on American market shipments along with rising energy prices and low-cost Chinese imports.

The steel industry on both sides of the Channel is described as a essential sector, supplying elemental components in everything from building frameworks, wind turbines and railways to household appliances and kitchenware.

Implementation and Future Actions

These proposals must be agreed by EU nations and the EU legislature, with the EU executive head calling on member states and European parliament members to move quickly in backing the proposal.

Should approval be granted, the EU will cut its existing tariff-free allowance by forty-seven percent to 18.3 million tons a year, a volume previously recorded in 2013. It will apply a 50% tariff on imports beyond the quota and require countries exporting into the EU to declare the production origin to prevent circumvention of the measures.

Exceptions and International Cooperation

These European nations will be exempt from import limits or duties due to their close trading relationship in the European Economic Area, the EU has said.

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

EU must take immediate action, and firmly, prior to operations cease in significant portions of the EU steel industry and its value chains.