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The European Union have announced plans to mirror the United States' steel tariffs, increasing to double levies on foreign steel to fifty percent in a action described as "an existential threat" to the industry in the UK.

Unprecedented Crisis for British Steel Industry

Given that 80% of UK steel shipments destined for the European Union, this change represents the British steel sector's biggest ever challenge, as stated by the lobby group representing the sector.

European Commission Measures and Rules

In its plan submitted to the EU legislature this week, the EU executive also proposed cutting the current allowance for tariff-exempt steel and requiring foreign suppliers to disclose where the steel was melted and poured to prevent China 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, reduce emissions, and become competitive again.

Replacement of Existing System

These measures are designed to supersede 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. Inaction could have been "catastrophic" for the sector, a European official said.

Industry Response and Concerns

However, industry representatives, from the trade association UK Steel, said EU doubling its tariffs would create "the most severe challenge the British steel sector has encountered".

There were calls for the government to "acknowledge the critical necessity to put in place domestic protections to protect" the British steel sector – which is still reeling from a twenty-five percent duty imposed by Trump earlier this year – from the risk of millions of tonnes of global steel diverted away from US and European markets.

This flood of imports "might prove fatal for many of our remaining steel companies.

Union and Government Calls

Union leaders, representative at labor union Community, said the proposed changes represented "an existential threat" to UK steel.

Unions and industry leaders urged Keir Starmer 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 No 1 trading partner.

Broader Context

Sector representatives in the European Union have repeatedly cautioned for several months that their own industry faces being "wiped out" through the increased duties on exports to the US along with rising energy prices and low-cost Chinese imports.

Steel on in both the UK and EU is described as a foundational industry, supplying elemental components in products ranging from skyscraper structures, wind turbines and railways to dishwashers and cutlery.

Adoption and Future Actions

The new measures must be agreed by member states and the European parliament, with the EU executive head urging national governments and European parliament members to move quickly in support of the initiative.

Should approval be granted, the European Union will reduce its current duty-free quota by forty-seven percent to 18.3m tonnes a year, a level previously recorded in 2013. It will apply a 50% tariff on imports exceeding the limit and require nations exporting into the EU to state where the steel was melted and poured to avoid bypassing of the sanctions.

Exceptions and International Cooperation

Norway, Iceland, and Liechtenstein 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 ringfence their respective economies from excess production.

EU needs to act now, and decisively, prior to operations cease in large parts of the European steel sector and its value chains.