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EU officials have announced plans to mirror Donald Trump's import duties on steel, effectively doubling levies on foreign steel to 50% in a action condemned as "an existential threat" to the sector in Britain.

Unprecedented Crisis for UK Steel Industry

Given that eighty percent of British exports destined for the European Union, this policy shift creates the British steel sector's most severe challenge, as stated by the industry association speaking for the sector.

European Commission Proposals and Rules

In its plan submitted to the EU legislature on Tuesday, the European Commission additionally suggested slashing the existing quota for tariff-exempt steel and requiring foreign suppliers to declare the origin of steel production to prevent Chinese producers sneaking products in through other countries.

EU steel sector faced potential collapse – we are protecting it so that it can invest, reduce emissions, and regain competitiveness.

Overhaul of Current Framework

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 seen as ineffective. Inaction could have been "fatal" for the industry, a European official said.

Industry Reaction and Concerns

Nevertheless, Gareth Stace, from the trade association UK Steel, said EU doubling its tariffs would create "the biggest crisis the UK steel industry has encountered".

There were calls for the government to "acknowledge the critical necessity to put in place domestic protections to protect" the UK steel industry – which is affected by a 25% tariff from Trump earlier this year – from the threat of millions of tonnes of world steel diverted away from American and EU markets.

This surge in foreign steel "could be fatal for numerous steel companies.

Union and Government Pressure

Union leaders, assistant general secretary at steelworkers' union Community, stated the proposed changes posed "an existential threat" to UK steel.

Unions and industry leaders urged Keir Starmer to start negotiations urgently with the European Union on country-specific tariff exemptions, noting that the United Kingdom was now the European Union's primary export market.

Broader Context

Sector representatives in the EU have repeatedly cautioned for months that their own industry confronts being "wiped out" through the increased duties on exports to the US along with high energy costs and low-cost Chinese imports.

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

Adoption and Future Actions

These proposals require approval by EU nations and the European parliament, with the EU executive head calling on national governments and European parliament members to move quickly in support of the initiative.

Should approval be granted, the European Union will reduce its existing tariff-free allowance by 47% to 18.3 million tons a annually, a level last seen in 2013. It will impose a fifty percent tariff on foreign steel exceeding the limit and require countries exporting into the bloc to declare the production origin to prevent circumvention of the sanctions.

Exemptions 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 confirmed.

Alongside the proposal, the European Union is seeking a "steel partnership" with the United States to ringfence their respective economies from overcapacity.

EU must take immediate action, and firmly, prior to all lights go out in large parts of the European steel sector and its supply networks.