🔗 Share this article European Union's Proposal to Match Trump's Steel Tariffs Poses 'Existential Threat' to UK's Steel Industry The European Union have announced they will adopt Donald Trump's steel tariffs, increasing to double levies on foreign steel to 50% in a decision condemned as "a survival risk" to the industry in the UK. Unprecedented Crisis for British Steel Exports Given that 80% of UK steel shipments going to the EU, this policy shift poses the British steel sector's most severe challenge, as stated by the industry association speaking for the sector. New EU Proposals and Rules Through its proposal submitted to the EU legislature on Tuesday, the European Commission also proposed reducing the existing quota for tariff-exempt steel and requiring international producers to state the origin of steel production to stop Chinese producers sneaking products in through other countries. EU steel sector stood at the brink of failure – we are protecting it so that investments can be made, decarbonise, and become competitive again. Overhaul of Existing System These measures are intended to supersede a import framework that has been functioning for the past seven years and which is due to expire in 2026 and is now considered ineffective. Inaction could have been "catastrophic" for the sector, a European official said. Sector Response and Concerns Nevertheless, Gareth Stace, from the industry body UK Steel, stated EU doubling its tariffs would pose "the biggest crisis the British steel sector has encountered". There were calls for the UK authorities to "acknowledge the urgent need to implement its own measures to defend" the UK steel industry – which is still reeling from a twenty-five percent duty from the US recently – from the threat of vast quantities of world steel diverted away from American and EU markets. This flood of imports "could be fatal for numerous steel companies. Labor and Government Pressure Alasdair McDiarmid, assistant general secretary at steelworkers' union the industry union, stated the proposed changes posed "an existential threat" to UK steel. Labor and business representatives urged Keir Starmer to start negotiations urgently with the EU on nation-specific tariff exemptions, noting that the UK was now the European Union's No 1 trading partner. Industry Background Industry leaders in the European Union have also been warning for several months that the European steel sector faces being "wiped out" through the new 50% tariffs on exports to the US combined with high energy costs and low-cost Chinese imports. The steel industry on both sides of the Channel is described as a foundational industry, supplying elemental components in everything from skyscraper structures, renewable energy equipment and railways to household appliances and kitchenware. Adoption and Next Steps The new measures must be agreed by member states and the European parliament, with the EU executive head calling on national governments and MEPs to move quickly in backing the initiative. Should approval be granted, the EU will reduce its existing tariff-free allowance by 47% to 18.3 million tons a year, a volume previously recorded in 2013. It will apply a 50% tariff on foreign steel beyond the quota and require countries shipping to the EU to state where the steel was melted and poured to prevent circumvention of the sanctions. Exceptions and Global Partnerships Norway, Iceland, and Liechtenstein will not be subject to import limits or duties due to their strong economic ties in the European Economic Area, the EU has confirmed. In addition to these measures, the European Union is pursuing a "metals alliance" with the United States to ringfence their respective economies from overcapacity. The European Union needs to act now, and firmly, before operations cease in significant portions of the EU steel industry and its value chains.