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The European Union revealed plans to match Donald Trump's steel tariffs, increasing to double taxes on imports to fifty percent in a move described as "an existential threat" to the sector in Britain.

Unprecedented Crisis for British Steel Exports

Given that eighty percent of British exports going to the European Union, this change represents the UK steel industry's largest challenge, as stated by the industry association representing the industry.

New EU Measures and Regulations

In its plan submitted to the EU legislature this week, the EU executive also proposed slashing the existing quota for tariff-exempt steel and requiring international producers to declare where the steel was melted and poured to stop China sneaking products in through third nations.

The European steel industry faced potential collapse – we are protecting it so that investments can be made, decarbonise, and become competitive again.

Replacement of Existing System

These measures are intended to replace a import framework that has been in operation for the past seven years and which is set to expire in 2026 and is now considered not fit for purpose. To do nothing could have been "catastrophic" for the sector, one EU official stated.

Industry Response and Concerns

Nevertheless, Gareth Stace, from the trade association UK Steel, said Brussels doubling its tariffs would pose "the biggest crisis the British steel sector has ever faced".

There were calls for the UK authorities to "acknowledge the urgent need to put in place its own measures to protect" the British steel sector – which is still reeling from a twenty-five percent duty from Trump earlier this year – from the risk of millions of tonnes of global steel diverted away from American and EU markets.

This flood of imports "could be fatal for numerous steel companies.

Union and Government Calls

Union leaders, assistant general secretary at steelworkers' union Community, said the new measures posed "a survival risk" to UK steel.

Unions and industry leaders called on Keir Starmer to begin talks urgently with the European Union on country-specific duty-free quotas, noting that the UK was now the European Union's primary export market.

Industry Background

Industry leaders in the EU have also been warning for months that their own industry confronts being "wiped out" through the increased duties on exports to the US along with rising energy prices and low-cost Chinese imports.

The steel industry on both sides of the Channel is considered a foundational industry, providing elemental components in everything from building frameworks, renewable energy equipment and railways to dishwashers and kitchenware.

Adoption and Next Steps

The new measures must be agreed by EU nations and the European parliament, with the European Commission president calling on member states and European parliament members to act fast in support of the proposal.

Should approval be granted, the EU will cut its existing tariff-free allowance by 47% to 18.3 million tons a annually, a volume last seen in 2013. It will impose a 50% tariff on imports exceeding the limit and require countries exporting into the EU to declare the production origin to avoid bypassing of the measures.

Exceptions and Global Partnerships

These European nations will be exempt from import limits or duties because of their close trading relationship in the EEA, the EU has said.

In addition to these measures, the European Union is pursuing a "metals alliance" with the United States to protect their respective economies from excess production.

The European Union needs to act now, and decisively, prior to all lights go out in significant portions of the EU steel industry and its value chains.