EU's Proposal to Align With US Steel Tariffs Poses 'Survival Risk' to UK's Steel Industry

The European Union revealed plans to adopt Donald Trump's import duties on steel, increasing to double taxes on imports to fifty percent in a move described as "a survival risk" to the industry in Britain.

Unprecedented Crisis for UK Steel Industry

With 80% of British exports destined for the EU, this policy shift creates the UK steel industry's most severe challenge, according to the industry association speaking for the sector.

New EU Measures and Rules

Through its proposal presented to the EU legislature this week, the European Commission additionally suggested slashing the current allowance for duty-free imports and obliging international producers to disclose where the steel was melted and poured to stop Chinese producers diverting exports through other countries.

EU steel sector was on the verge of collapse – these measures safeguard it so that it can invest, reduce emissions, and regain competitiveness.

Overhaul of Existing System

These measures are intended 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system that has been in operation for the past seven years and which is set to expire in 2026 and is now considered outdated. Inaction could have been "catastrophic" for the industry, one EU official said.

Industry Response and Concerns

Nevertheless, industry representatives, from the industry body UK Steel, stated Brussels doubling its tariffs would create "the most severe challenge the UK steel industry has encountered".

He called on the government to "acknowledge the critical necessity to implement its own measures to protect" the UK steel industry – which is affected by a 25% tariff imposed by the US recently – from the threat of vast quantities of world steel redirected from American and EU markets.

This flood of imports "could be fatal for many of our remaining steel companies.

Union and Government Calls

Alasdair McDiarmid, representative at steelworkers' union Community, said the new measures represented "a survival risk" to British steel production.

Unions and industry leaders called on the UK government to start negotiations urgently with the European Union on country-specific duty-free quotas, pointing out that the UK was now the European Union's primary trading partner.

Broader Context

Industry leaders in the European Union have repeatedly cautioned for months that their own industry faces being "wiped out" through the increased duties on American market shipments combined with rising energy prices and cheap Chinese competition.

Steel on in both the UK and EU is described as a foundational industry, providing basic materials in everything from skyscraper structures, wind turbines and railways to household appliances and kitchenware.

Implementation and Next Steps

These proposals require approval by member states and the European parliament, with the European Commission president calling on national governments and European parliament members to act fast in backing the initiative.

If the plan is ratified, the European Union will cut its existing tariff-free allowance by forty-seven percent to 18.3 million tons a annually, a level previously recorded in 2013. It will apply a 50% tariff on foreign steel beyond the quota and require nations exporting into the bloc to state where the steel was melted and poured to prevent circumvention of the sanctions.

Exceptions and International Cooperation

These European nations will be exempt from tariff quotas or tariffs because of their strong economic ties in the European Economic Area, the European Union has said.

Alongside the proposal, the European Union is pursuing a "steel partnership" with the United States to protect their respective economies from excess production.

EU must take immediate action, and firmly, before operations cease in significant portions of the European steel sector and its supply networks.