UK Poised to Ease Steel Tariffs as Manufacturers Warn of Costs

The UK's Steel Tariff Dilemma

Ministers are expected to drop some planned tariffs on foreign steel after UK manufacturers warned the measures would significantly increase their costs. Representatives of the Department of Business and Trade are meeting leaders of steel trading business groups to finalise details of a reprieve for certain industries.

Background on Steel Tariffs

The government announced in March that it was doubling tariffs on steel imports to 50% and reducing quotas by up to 60% in an attempt to save UK producers. The new tariffs and quotas must be in place by 1 July, when the current safeguards, negotiated while the UK was still part of the EU, expire.

The Data Analysis

• About 70% of the UK's steel is imported.
• The government safeguards are aimed at reducing that figure to 50%.

The Impact Analysis

UK Steel said it had submitted 'comprehensive proposals' to remove certain steel commodities from the tariff list to protect industries that could not source those products at all, or in sufficient quantities, in the UK. Gareth Stace, director of UK Steel, said it was vital that ministers struck a balance between protecting the broader manufacturing sector and the steel plants facing the EU tariff threat.

The Prediction

Others say it is more likely that the government will formalise tariff exemptions for specific sectors and companies that import steel not produced domestically. William Bain, head of trade policy at British Chambers of Commerce, said: 'We've had an unprecedented response from companies across the UK about the serious negative impact on costs of quotas and tariffs on construction, manufacturing and engineering. That case has been put to the government, which has been listening, and we await to see what the full and final proposals would be.'