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EU officials declared they will adopt Donald Trump's steel tariffs, effectively doubling taxes on foreign steel to 50% in a move described as "an existential threat" to the sector in Britain.

Major Challenge for UK Steel Exports

With 80% of British exports going to the European Union, this policy shift creates the UK steel industry's largest crisis, according to the industry association representing the sector.

New EU Proposals and Rules

Through its proposal presented to the European parliament on Tuesday, the EU executive 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 Chinese producers diverting exports through other countries.

The European steel industry faced potential collapse – we are protecting it so that investments can be made, decarbonise, and become competitive again.

Replacement of Current Framework

The proposals are intended to supersede a quota system that has been functioning for the last seven years and which is due to expire in 2026 and is now seen as not fit for purpose. To do nothing could have been "fatal" for the sector, one EU official stated.

Industry Reaction and Concerns

Nevertheless, industry representatives, from the trade association British Steel, stated Brussels increasing duties would pose "the most severe challenge the British steel sector has encountered".

There were calls for the UK authorities to "acknowledge the urgent need to implement domestic protections to defend" the British steel sector – which is still reeling from a 25% tariff from Trump recently – from the threat of millions of tonnes of world steel diverted away from US and European markets.

This surge in foreign steel "might prove fatal for many of our remaining steel companies.

Union and Government Calls

Alasdair McDiarmid, assistant general secretary at labor union Community, said the new measures represented "a survival risk" to UK steel.

Labor and business representatives urged the UK government to begin talks immediately with the European Union on nation-specific duty-free quotas, pointing out that the United Kingdom was now the European Union's primary export market.

Broader Context

Sector representatives in the EU have also been warning for several months that their own industry confronts being "wiped out" through the new 50% tariffs 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 described as a foundational industry, providing basic materials in everything from skyscraper structures, renewable energy equipment and railways to dishwashers and cutlery.

Implementation and Next Steps

The new measures require approval by EU nations and the European parliament, with the European Commission president calling on national governments and European parliament members to move quickly in backing the initiative.

If the plan is ratified, the EU will reduce its current duty-free quota by 47% to 18.3m tonnes a annually, a level last seen in 2013. It will impose a 50% duty on foreign steel beyond the quota and require countries shipping to the bloc to declare where the steel was melted and poured to prevent circumvention of the sanctions.

Exemptions and International Cooperation

These European nations will not be subject to import limits or tariffs due to their close trading relationship in the EEA, the EU has confirmed.

Alongside the proposal, the European Union is seeking a "steel partnership" with the United States to ringfence their national industries from excess production.

EU must take immediate action, and firmly, before operations cease in large parts of the European steel sector and its supply networks.