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The European Union have announced they will adopt the United States' import duties on steel, increasing to double levies on imports to fifty percent in a action described as "an existential threat" to the industry in the UK.

Major Challenge for British Steel Industry

With 80% of British exports going to the EU, this policy shift poses the UK steel industry's biggest ever crisis, as stated by the lobby group speaking for the industry.

New EU Measures and Rules

Through its proposal submitted to the European parliament this week, the EU executive also proposed slashing the existing quota for tariff-exempt steel and requiring international producers to state where the steel was melted and poured to prevent China sneaking products in through third nations.

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

Overhaul of Current Framework

The proposals are intended to supersede a import framework that has been in operation for the past seven years and which is due to expire in 2026 and is now considered outdated. To do nothing could have been "fatal" for the sector, one EU official said.

Industry Reaction and Concerns

However, industry representatives, head of the industry body British Steel, said Brussels doubling its tariffs would pose "the biggest crisis the British steel sector has encountered".

There were calls for the government to "acknowledge the critical necessity to implement domestic protections to protect" the UK steel industry – which is affected by a twenty-five percent 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 terminal for numerous steel companies.

Labor and Government Calls

Alasdair McDiarmid, assistant general secretary at labor union the industry union, stated the proposed changes represented "an existential threat" to UK steel.

Unions and industry leaders called on Keir Starmer to start negotiations immediately with the EU on country-specific tariff exemptions, pointing out that the United Kingdom was now the European Union's No 1 trading partner.

Broader Context

Sector representatives in the EU have repeatedly cautioned for several months that the European steel sector confronts being "eliminated" through the increased duties on American market shipments along with high energy costs and low-cost Chinese imports.

The steel industry on in both the UK and EU is described as a essential sector, supplying elemental components in products ranging from building frameworks, renewable energy equipment and transport infrastructure to dishwashers and kitchenware.

Adoption and Future Actions

The new measures require approval by EU nations and the EU legislature, with the European Commission president calling on member states and MEPs to move quickly in backing the proposal.

If the plan is ratified, the EU will cut its current duty-free quota by forty-seven percent to 18.3 million tons a annually, a volume previously recorded in 2013. It will apply a 50% tariff on imports exceeding the limit and require countries exporting into the EU to state the production origin to prevent circumvention of the sanctions.

Exemptions and Global Partnerships

These European nations will not be subject to import limits or tariffs due to their strong economic ties in the European Economic Area, the European Union has said.

In addition to these measures, the EU is pursuing a "metals alliance" with the US to ringfence their respective economies from overcapacity.

EU needs to act now, and decisively, before operations cease in large parts of the EU steel industry and its supply networks.