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The European Union revealed they will match the United States' import duties on steel, effectively doubling levies on imports to fifty percent in a decision condemned as "a survival risk" to the industry in the UK.

Major Challenge for UK Steel Industry

Given that eighty percent of British exports destined for the European Union, this policy shift creates the British steel sector's biggest ever challenge, as stated by the industry association representing the industry.

European Commission Proposals and Regulations

In its plan submitted to the European parliament on Tuesday, the European Commission also proposed slashing the current allowance for tariff-exempt steel and requiring foreign suppliers to state the origin of steel production to stop Chinese producers sneaking products in through third nations.

The European steel industry stood at the brink of failure – we are protecting it so that investments can be made, decarbonise, and regain competitiveness.

Overhaul of Existing System

These measures are intended to replace a quota system that has been in operation for the last seven years and which is due to expire in 2026 and is now seen as outdated. Inaction could have been "fatal" for the industry, one EU official said.

Sector Response and Concerns

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

He called on the government to "recognise the urgent need to put in place its own measures to defend" the UK steel industry – which is still reeling from a twenty-five percent tariff from the US earlier this year – from the threat of vast quantities of global steel diverted away from US and European markets.

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

Union and Government Pressure

Alasdair McDiarmid, assistant general secretary at steelworkers' union Community, stated the new measures posed "a survival risk" to British steel production.

Labor and business representatives called on Keir Starmer to start negotiations urgently with the European Union on country-specific duty-free quotas, pointing out that the United Kingdom was now the EU's No 1 export market.

Broader Context

Industry leaders in the EU have also been warning for several months that their own industry confronts being "wiped out" through the increased duties on exports to the US combined with high energy costs and cheap Chinese competition.

The steel industry on in both the UK and EU is considered a foundational industry, supplying basic materials in everything from building frameworks, renewable energy equipment and transport infrastructure to household appliances and cutlery.

Implementation and Future Actions

These proposals must be agreed by member states and the EU legislature, with the EU executive head calling on member states and European parliament members to move quickly in support of the initiative.

Should approval be granted, the European Union will cut its existing tariff-free allowance by forty-seven percent to 18.3m tonnes a year, a volume previously recorded in 2013. It will apply a fifty percent duty on foreign steel beyond the quota and require nations shipping to the bloc to state where the steel was melted and poured to prevent circumvention of the measures.

Exceptions and Global Partnerships

Norway, Iceland, and Liechtenstein will not be subject to tariff quotas or duties due to their close trading relationship in the European Economic Area, the EU has said.

In addition to these measures, the European Union is seeking a "metals alliance" with the United States to protect their national industries 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 value chains.