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EU officials declared they will match Donald Trump's steel tariffs, effectively doubling taxes on foreign steel to 50% in a move condemned as "a critical danger" to the industry in the UK.

Major Challenge for British Steel Industry

Given that eighty percent of UK steel shipments destined for the EU, this change represents the British steel sector's largest crisis, as stated by the lobby group speaking for the sector.

New EU Proposals and Rules

Through its proposal submitted to the EU legislature on Tuesday, the EU executive also proposed cutting the current allowance for tariff-exempt steel and requiring foreign suppliers to state the origin of steel production to prevent Chinese producers diverting exports through third nations.

EU steel sector faced potential collapse – these measures safeguard it so that investments can be made, decarbonise, and regain competitiveness.

Replacement of Existing System

These measures are intended to supersede a quota system that has been functioning for the past seven years and which is due to expire in 2026 and is now considered not fit for purpose. To do nothing could have been "disastrous" for the sector, a European official stated.

Industry Reaction and Warnings

Nevertheless, Gareth Stace, head of the industry body British Steel, stated Brussels increasing duties would pose "the most severe challenge the UK steel industry has encountered".

There were calls for the UK authorities to "recognise the urgent need to put in place domestic protections to protect" the British steel sector – which is affected by a 25% duty imposed by Trump earlier this year – from the threat of vast quantities of world steel diverted away from US and European markets.

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

Labor and Political Calls

Union leaders, representative at labor union Community, said the proposed changes posed "an existential threat" to British steel production.

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

Broader Context

Sector representatives in the EU have repeatedly cautioned for several months that their own industry confronts being "wiped out" through the new 50% tariffs on American market shipments combined with rising energy prices and cheap Chinese competition.

Steel on both sides of the Channel is considered a essential sector, supplying elemental components in everything from skyscraper structures, wind turbines and railways to dishwashers and kitchenware.

Implementation and Next Steps

The new measures must be agreed by member states and the European parliament, with the EU executive head calling on member states and European parliament members to move quickly in backing the initiative.

Should approval be granted, the European Union will reduce its existing tariff-free allowance by forty-seven percent to 18.3m tonnes a annually, a level last seen in 2013. It will impose a 50% tariff on imports exceeding the limit and oblige countries shipping to the EU to state the production origin to avoid bypassing of the sanctions.

Exceptions and International Cooperation

These European nations will not be subject to tariff quotas or tariffs because of their strong economic ties in the European Economic Area, the European Union has confirmed.

Alongside the proposal, the European Union is seeking a "metals alliance" with the US to protect their respective economies 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.