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EU officials revealed plans to match the United States' import duties on steel, effectively doubling taxes on imports to fifty percent in a move described as "an existential threat" to the industry in Britain.

Unprecedented Crisis for UK Steel Exports

With 80% of UK steel shipments destined for the European Union, this policy shift creates the British steel sector's most severe challenge, according to the lobby group speaking for the industry.

European Commission Proposals and Rules

In its plan submitted to the European parliament on Tuesday, the European Commission additionally suggested slashing the current allowance for tariff-exempt steel and obliging international producers to disclose where the steel was melted and poured to prevent Chinese producers sneaking products in through other countries.

EU steel sector stood at the brink of failure – we are protecting it so that it can invest, reduce emissions, and regain competitiveness.

Replacement of Current Framework

The proposals are intended to replace a import framework that has been functioning for the last seven years and which is set to expire in 2026 and is now seen as outdated. Inaction could have been "fatal" for the industry, a European official stated.

Sector Reaction and Warnings

Nevertheless, Gareth Stace, head of the trade association UK Steel, stated EU increasing duties would pose "the most severe challenge the British steel sector has ever faced".

There were calls for the government to "acknowledge the critical necessity to implement its own measures to protect" the British steel sector – which is affected by a 25% duty from the US earlier this year – from the threat of vast quantities of global steel redirected from US and European markets.

This surge in foreign steel "might prove fatal for numerous steel companies.

Union and Government Pressure

Alasdair McDiarmid, representative at steelworkers' union the industry union, said the proposed changes posed "a survival risk" to UK steel.

Labor and business representatives called on Keir Starmer to begin talks urgently with the EU on country-specific tariff exemptions, pointing out that the UK was now the European Union's No 1 export market.

Broader Context

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

The steel industry on in both the UK and EU is considered a foundational industry, providing basic materials in products ranging from skyscraper structures, renewable energy equipment and transport infrastructure to household appliances and cutlery.

Implementation and Next Steps

These proposals require approval by EU nations and the European parliament, with the European Commission president urging national governments and European parliament members to act fast in backing the proposal.

Should approval be granted, the European Union will reduce its current duty-free quota by 47% to 18.3m tonnes a annually, a volume last seen in 2013. It will impose a 50% duty on foreign steel exceeding the limit and require countries exporting into the bloc 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 close trading relationship in the European Economic Area, the European Union has confirmed.

In addition to these measures, the European Union is seeking a "metals alliance" with the US to ringfence their respective economies from excess production.

EU needs to act now, and decisively, prior to all lights go out in significant portions of the European steel sector and its supply networks.