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EU officials declared plans to adopt the United States' steel tariffs, increasing to double levies on foreign steel to 50% in a action condemned as "a survival risk" to the sector in the UK.

Unprecedented Crisis for UK Steel Industry

Given that 80% of UK steel shipments destined for the EU, this change represents the UK steel industry's largest challenge, according to the lobby group representing the industry.

European Commission Measures and Rules

Through its proposal submitted to the EU legislature on Tuesday, the European Commission also proposed slashing the existing quota for tariff-exempt steel and obliging international producers to state the origin of steel production to prevent China diverting exports through other countries.

The European steel industry was on the verge of collapse – we are protecting it so that investments can be made, reduce emissions, and regain competitiveness.

Overhaul of Current Framework

The proposals are intended to replace a quota system that has been functioning 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, one EU official said.

Sector Reaction and Concerns

However, industry representatives, from the industry body British Steel, said EU increasing duties would create "the most severe challenge the UK steel industry has ever faced".

He called on the government to "acknowledge the urgent need to put in place its own measures to defend" the UK steel industry – which is affected by a 25% tariff from the US earlier this year – from the threat of vast quantities of world steel redirected from US and European markets.

This flood of imports "could be terminal for numerous steel companies.

Union and Political Pressure

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

Labor and business representatives called on Keir Starmer to start negotiations urgently with the European Union on nation-specific duty-free quotas, pointing out that the United Kingdom was now the EU's primary trading partner.

Broader Context

Sector representatives in the EU have also been warning for several months that the European steel sector faces being "eliminated" through the new 50% tariffs on exports to the US combined with high energy costs and cheap Chinese competition.

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

Implementation and Next Steps

The new measures must be agreed by member states and the EU legislature, with the European Commission president urging national governments and European parliament members to move quickly in support of the initiative.

If the plan is ratified, the European Union will cut its current duty-free quota by 47% to 18.3 million tons a year, a level previously recorded in 2013. It will impose a fifty percent tariff on imports beyond the quota and require nations shipping to the EU to state the production origin to prevent circumvention of the measures.

Exceptions and Global Partnerships

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

In addition to these measures, the EU is seeking a "steel partnership" with the US to ringfence their national industries from overcapacity.

The European Union needs to act now, and firmly, prior to operations cease in significant portions of the EU steel industry and its supply networks.