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EU officials have announced they will match Donald Trump's import duties on steel, effectively doubling taxes on imports to 50% in a move described as "a critical danger" to the industry in the UK.

Major Challenge for British Steel Exports

With 80% of British exports destined for the European Union, this policy shift represents the UK steel industry's biggest ever crisis, as stated by the industry association representing the industry.

New EU Proposals and Regulations

Through its proposal presented to the EU legislature on Tuesday, the European Commission also proposed slashing the current allowance for tariff-exempt steel and requiring foreign suppliers to declare where the steel was melted and poured to prevent China diverting exports through other countries.

EU steel sector stood at the brink of failure – these measures safeguard it so that investments can be made, reduce emissions, and become competitive again.

Replacement of Current Framework

The proposals are intended to replace 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 "fatal" for the industry, a European official said.

Industry Reaction and Concerns

However, industry representatives, from the trade association UK Steel, stated Brussels increasing duties would create "the biggest crisis the British steel sector has encountered".

There were calls for the government to "recognise the critical necessity to implement its own measures to protect" the British steel sector – which is still reeling from a 25% duty from Trump earlier this year – from the threat of millions of tonnes of world steel redirected from US and European markets.

This surge in foreign steel "could be fatal for many of our remaining steel companies.

Labor and Government Calls

Union leaders, assistant general secretary at labor union Community, stated the new measures posed "a survival risk" to British steel production.

Unions and industry leaders called on Keir Starmer to start negotiations urgently with the European Union on nation-specific tariff exemptions, noting that the United Kingdom was now the EU's No 1 export market.

Industry Background

Sector representatives in the EU have also been warning for several months that their own industry faces being "eliminated" through the new 50% tariffs on American market shipments along with high energy costs and cheap Chinese competition.

Steel on in both the UK and EU is considered a essential sector, supplying elemental components in products ranging from skyscraper structures, renewable energy equipment and railways to household appliances and cutlery.

Implementation and Future Actions

These proposals must be agreed by EU nations and the European parliament, with the European Commission president urging member states and European parliament members to move quickly in support of the proposal.

If the plan is ratified, the EU will reduce its current duty-free quota by 47% to 18.3m tonnes a year, a volume last seen in 2013. It will impose a fifty percent tariff on imports beyond the quota and require nations exporting into the EU to state where the steel was melted and poured to prevent circumvention of the sanctions.

Exceptions and International Cooperation

Norway, Iceland, and Liechtenstein will not be subject to import limits or duties because of their strong economic ties in the European Economic Area, the EU has confirmed.

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

EU needs to act now, and firmly, prior to all lights go out in large parts of the EU steel industry and its value chains.