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The European Union declared they will match Donald Trump's import duties on steel, effectively doubling taxes on foreign steel to fifty percent in a decision described as "a survival risk" to the industry in the UK.

Unprecedented Crisis for British Steel Exports

With eighty percent of UK steel shipments destined for the EU, this policy shift represents the UK steel industry's largest challenge, as stated by the industry association speaking for the sector.

New EU Measures and Rules

In its plan submitted to the EU legislature on Tuesday, the EU executive also proposed reducing the current allowance for duty-free imports and requiring international producers to declare the origin of steel production to stop Chinese producers sneaking products in through other countries.

The European steel industry was on the verge of collapse – we are protecting it so that it can invest, decarbonise, and regain competitiveness.

Overhaul of Existing System

The proposals are designed to supersede a quota system that has been functioning for the last seven years and which is due to expire in 2026 and is now considered outdated. To do nothing could have been "catastrophic" for the industry, one EU official said.

Sector Response and Warnings

However, industry representatives, head of the industry body UK Steel, said Brussels increasing duties would pose "the biggest crisis the UK steel industry has encountered".

He called on the UK authorities to "acknowledge the critical necessity to put in place its own measures to protect" the British steel sector – which is affected by a twenty-five percent tariff imposed by Trump earlier this year – from the threat of vast quantities of global steel redirected from American and EU markets.

This surge in foreign steel "could be fatal for numerous steel companies.

Labor and Political Pressure

Alasdair McDiarmid, assistant general secretary at labor union Community, said the new measures represented "an existential threat" to British steel production.

Labor and business representatives urged Keir Starmer to begin talks urgently with the European Union on nation-specific tariff exemptions, pointing out that the UK was now the European Union's primary export market.

Broader Context

Sector representatives in the EU have repeatedly cautioned for several months that the European steel sector faces 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 foundational industry, providing basic materials in products ranging from building frameworks, wind turbines and railways to household appliances and kitchenware.

Adoption and Next Steps

These proposals must be agreed by EU nations and the EU legislature, with the European Commission president urging member states and European parliament members to move quickly in support of the initiative.

Should approval be granted, the EU will reduce its existing tariff-free allowance by 47% to 18.3m tonnes a year, a volume previously recorded in 2013. It will apply a 50% duty on foreign steel exceeding the limit and require nations shipping to the EU to declare the production origin to prevent circumvention of the sanctions.

Exceptions and International Cooperation

Norway, Iceland, and Liechtenstein will not be subject to tariff quotas or tariffs because of their close trading relationship in the European Economic Area, the European Union has said.

In addition to these measures, the European Union is pursuing a "steel partnership" with the US to ringfence their respective economies from excess production.

The European Union needs to act now, and decisively, prior to all lights go out in large parts of the EU steel industry and its supply networks.