UK Ministers Consider Easing Steel Tariffs Following Industry Warnings
UK government ministers are anticipated to reduce some of the planned tariffs on imported steel after warnings from domestic manufacturers about significant cost increases. Representatives from the Department of Business and Trade are scheduled to meet with leaders of steel trading business groups on Wednesday and Thursday to finalize details of potential exemptions for certain industries.
In March, the government announced measures aimed at supporting domestic steel production by reducing import quotas by up to 60%. These new tariffs and quotas are set to be implemented by 1 July, coinciding with the expiration of current safeguards that were negotiated while the UK was still part of the European Union.
Simultaneously, the UK is engaged in efforts to counteract tariffs planned by the EU for the same date. Both the UK and the EU have opted to limit steel imports to protect their respective industries from cheaper imports originating from countries such as China and Vietnam.
The British government has already introduced a three-month reprieve on import duties, referred to as a “transition period,” for steel buyers. Some stakeholders suggest this period could be extended to 12 months, while others believe the government is more likely to formalize tariff exemptions for specific sectors and companies importing steel products not produced domestically.
Industry Proposals and Government Discussions
UK Steel has submitted comprehensive proposals requesting the removal of certain steel commodities from the tariff list to safeguard industries unable to source these products domestically or in sufficient quantities.
“We understand other sectors have done likewise to inform the government’s final policy and we continue to have extensive discussions with impacted manufacturers,”
a spokesperson for UK Steel stated.
Currently, approximately 70% of the UK’s steel is imported. The government’s safeguards aim to reduce this figure to 50%.
Gareth Stace, director of UK Steel, emphasized the importance of balancing protection for the broader manufacturing sector with support for steel plants facing the EU tariff threat.
“The provisional safeguards were already having the desired impact of increasing domestic supplies, with steelmakers ramping up capacity, creating jobs,”
he said, adding that more announcements regarding the reopening of mothballed capacity are expected in the near future.
Business Community Response and Government Engagement
William Bain, head of trade policy at the British Chambers of Commerce, highlighted the widespread concern among UK companies regarding the negative impact of quotas and tariffs on costs in construction, manufacturing, and engineering sectors.
“We’ve had an unprecedented response from companies across the UK about the serious negative impact on costs of quotas and tariffs on construction, manufacturing and engineering. That case has been put to the government, which has been listening, and we await to see what the full and final proposals would be.”
Meanwhile, Business Secretary Peter Kyle has raised with the EU the issue of protecting British steel manufacturers from anticipated tariffs imposed by the bloc.
Speaking to reporters in Brussels last Friday, he acknowledged that some of the new steel safeguards were “disruptive” but stressed the importance of protecting domestic markets.
“It was important to protect domestic markets,”
he said.
