UK steel industry steps up plans in run-up to a potential life-or-death affair Yet the European Union is poised to almost cut its tariff-free quota for steel imports by half. If finalized, this decision will result in hefty tariffs on steel outputs from countries such as the United Kingdom. British manufacturers might even suffer fatal damage as a consequence.
UK Steel, the trade body for the UK’s steel manufacturers, has fiercely opposed the proposed reforms. They threaten that these changes would lead to an unnecessary loss of thousands of jobs, particularly at Port Talbot, the UK’s largest steelworks. This facility alone is now under tremendous cloud of uncertainty as the entire industry struggles to adapt to these new and unpredictable trade barriers.
The British steel industry has undergone a steep free-fall since its high three decades ago at the height of the 1970s. It now makes up just 0.1% of our national economy. Yet in the past two decades, it has lost around a quarter of its workforce, according to Eurostat. The proposed reduction in tariff-free import quotas will compound these challenges substantially. It not only endangers workers’ jobs today, it jeopardizes the future health of our entire industry.
British steel companies send over three-quarters of their steel exports to EU markets. UK Steel’s Director-General Gareth Stace remarked on the gravity of the situation, calling it “perhaps the biggest crisis the U.K. steel industry has ever faced.” He emphasized that the proposed tariffs could be “terminal for many of our remaining steel companies.”
British PM Keir Starmer finally acknowledged during Prime Minister’s Question Time this week that negotiations are still proceeding between the British government and the EU on such a proposal. “I’ll be able to tell you more in due course but we are in discussions, as you’d expect,” he stated.
The EU’s proposal would aim to protect Europe’s traditional steelmakers from overcapacity around the world. This problem has been exacerbated by the many high American tariffs introduced this past spring. The European Commission President Ursula von der Leyen noted that “a strong, decarbonized steel sector is vital for the European Union’s competitiveness, economic security and strategic autonomy.”
Concerning steel imports, the proposal includes a new public interest clause safeguard. For every ton over this 18.3 million ton quota, a 50% tariff will be imposed on all excess imports. This measure aims to prevent Europe’s markets from becoming inundated with steel redirected from the UK due to tariffs imposed by the United States.
Alasdair McDiarmid, Assistant General Secretary at UK Steel, echoed concerns about the potential ramifications, stating that “global overcapacity is a shared challenge and it is in both the UK and the EU’s interests to work together to find a solution.”
Judith Kirton-Darling, general secretary of the trade union bloc IndustriAll’s Europe office, proclaimed that steel was “the spine of Europe’s economy.” Though optimistic, she cautioned that the sector is at a tipping point right now. The current negotiations between the UK and the EU show that a careful balance is necessary. Finding this equilibrium is key to maintaining a vibrant, innovative steel sector throughout Europe.
While negotiations continue, industry advocates remain optimistic. Specifically, they’re looking for a resolution that will do more to lessen the adverse effects of the proposed changes, while still providing long-term job security and economic stability to the UK steel industry.
