🔗 Share this article

The European Union have announced they will adopt the United States' import duties on steel, effectively doubling taxes on imports to 50% in a action condemned as "a critical danger" to the sector in Britain.

Major Challenge for UK Steel Industry

With 80% of British exports going to the EU, this change represents the UK steel industry's largest crisis, according to the lobby group speaking for the sector.

European Commission Measures and Rules

Through its proposal submitted to the EU legislature on Tuesday, the EU executive additionally suggested reducing the current allowance for duty-free imports and obliging international producers to disclose where the steel was melted and poured to stop China diverting exports through other countries.

EU steel sector was on the verge of collapse – these measures safeguard it so that investments can be made, decarbonise, and become competitive again.

Replacement of Existing System

These measures are designed to supersede a quota system that has been in operation for the past seven years and which is set to expire in 2026 and is now considered outdated. To do nothing could have been "catastrophic" for the sector, a European official said.

Industry Response and Concerns

Nevertheless, Gareth Stace, from the trade association British Steel, said Brussels doubling its tariffs would pose "the most severe challenge the UK steel industry has encountered".

He called on the UK authorities to "recognise the critical necessity to put in place domestic protections to defend" the British steel sector – which is still reeling from a twenty-five percent tariff imposed by the US earlier this year – from the risk of vast quantities of global steel diverted away from US and European markets.

This flood of imports "might prove terminal for numerous steel companies.

Union and Government Calls

Alasdair McDiarmid, assistant general secretary at steelworkers' union Community, stated the proposed changes posed "an existential threat" to British steel production.

Labor and business representatives called on the UK government to start negotiations immediately with the EU on country-specific duty-free quotas, pointing out that the United Kingdom was now the EU's No 1 export market.

Broader Context

Industry leaders in the European Union have also been warning for months that the European steel sector confronts being "eliminated" through the new 50% tariffs on American market shipments combined with high energy costs and low-cost Chinese imports.

The steel industry on in both the UK and EU is described as a foundational industry, supplying basic materials in products ranging from skyscraper structures, wind turbines and railways to household appliances and cutlery.

Adoption and Future Actions

These proposals must be agreed by member states and the European parliament, with the EU executive head urging national governments and European parliament members to act fast in support of the proposal.

If the plan is ratified, the European Union will cut its current duty-free quota by forty-seven percent to 18.3 million tons a year, a level last seen in 2013. It will impose a fifty percent tariff on imports exceeding the limit and require nations shipping to the bloc to state where the steel was melted and poured to avoid bypassing of the measures.

Exceptions and Global Partnerships

These European nations will be exempt from tariff quotas or duties due to their strong economic ties in the EEA, the EU has confirmed.

Alongside the proposal, the EU is pursuing a "steel partnership" with the United States to protect their national industries from excess production.

The European Union must take immediate action, and decisively, before all lights go out in significant portions of the European steel sector and its value chains.