The UK steel industry has faced significant challenges since the country’s exit from the European Union, leading to the implementation of safeguard measures designed to protect domestic producers from a surge in imports. This safeguard includes a quota on specific steel products, imposing a 25% tariff on imports that exceed set limits. The primary objective is to shield the UK market from cheaper steel that may be diverted from other countries, particularly in response to global market fluctuations.
During its time as an EU member, the UK adhered to EU steel safeguard measures, which were introduced in 2018 following the United States’ imposition of tariffs on steel and aluminum. With the end of the transition period, the UK established its independent trade policy, allowing the Trade Remedies Authority to assess whether to maintain, modify, or revoke existing safeguards. In June 2021, the TRA recommended extending the safeguard measure on ten product categories for three years, while suggesting the removal of safeguards on nine other categories. This recommendation sparked discontent among major domestic producers and the trade body UK Steel, who argued that the measures were essential for the industry’s survival.
In response to industry concerns, the UK government decided to extend the safeguard measures for all fifteen categories of steel until June 30, 2024. Trade Secretary Anne-Marie Trevelyan emphasized that failing to continue these measures would pose a serious threat to UK steel producers. The government’s decision, while deviating from World Trade Organization obligations, was justified on the grounds of national interest and the need to protect a vital industry.
As the safeguard measures approach their expiration date, the TRA has again recommended extending these protections for an additional two years, until June 30, 2026. This extension comes amid ongoing pressures from international competition and the need for the UK steel industry to adapt to changing market conditions. The government’s commitment to maintaining these safeguards reflects a broader strategy to bolster domestic production while navigating global trade dynamics.
Reactions to the extension of the safeguard measures have been mixed. The Labour Party has welcomed the decision but called for a review of the TRA's framework, arguing that it favors importers over domestic producers. Concerns have also been raised regarding structural issues within the steel sector, such as high energy costs and the challenges of decarbonization. The UK steel industry has campaigned vigorously for these measures, viewing them as crucial for maintaining competitiveness and ensuring job security.
In parallel, the UK government has extended the suspension of tariffs on steel imports from Ukraine until 2026, reflecting ongoing geopolitical considerations stemming from Russia's invasion. This move aims to support Ukrainian manufacturers while also addressing supply chain concerns in the UK. The zero-tariff policy on Ukrainian steel is part of a broader effort to ensure that the UK steel industry remains resilient in the face of global disruptions.
