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EU officials have announced they will adopt Donald Trump's import duties on steel, increasing to double levies on foreign steel to fifty percent in a move described as "an existential threat" to the sector in the UK.

Unprecedented Crisis for UK Steel Industry

Given that 80% of UK steel shipments destined for the EU, this policy shift represents the British steel sector's largest crisis, according to the industry association speaking for the industry.

European Commission Proposals and Regulations

Through its proposal submitted to the European parliament on Tuesday, the European Commission also proposed reducing the current allowance for tariff-exempt steel and requiring foreign suppliers to disclose where the steel was melted and poured to prevent Chinese producers diverting exports through other countries.

EU steel sector stood at the brink of failure – these measures safeguard it so that investments can be made, reduce emissions, and regain competitiveness.

Replacement of Current Framework

The proposals are designed to replace a import framework that has been in operation for the last seven years and which is due to expire in 2026 and is now considered ineffective. Inaction could have been "fatal" for the industry, a European official said.

Sector Response and Concerns

However, industry representatives, head of the trade association British Steel, stated EU increasing duties would pose "the biggest crisis the UK steel industry has encountered".

There were calls for the government to "acknowledge the urgent need to implement domestic protections to defend" the British steel sector – which is affected by a twenty-five percent duty imposed by Trump recently – from the threat of millions of tonnes of global steel diverted away from American and EU markets.

This surge in foreign steel "could be terminal for many of our remaining steel companies.

Labor and Political Calls

Alasdair McDiarmid, assistant general secretary at steelworkers' union the industry union, said the proposed changes posed "a survival risk" to British steel production.

Unions and industry leaders called on Keir Starmer to start negotiations urgently with the European Union on country-specific tariff exemptions, pointing out that the UK was now the European Union's primary export market.

Industry Background

Industry leaders in the European Union have also been warning for several months that their own industry faces being "wiped out" through the new 50% tariffs on exports to the US combined 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 everything from building frameworks, wind turbines and transport infrastructure to household appliances and kitchenware.

Adoption and Next Steps

These proposals must be agreed by EU nations and the EU legislature, with the EU executive head calling on national governments and MEPs to act fast in backing the initiative.

If the plan is ratified, the EU will reduce its current duty-free quota by 47% to 18.3 million tons a year, a level last seen in 2013. It will apply a 50% duty on foreign steel beyond the quota and require nations shipping to the EU to declare where the steel was melted and poured to avoid bypassing of the measures.

Exemptions and International Cooperation

Norway, Iceland, and Liechtenstein will not be subject to import limits or duties because of their strong economic ties in the European Economic Area, the European Union has said.

Alongside the proposal, the European Union is pursuing a "metals alliance" with the United States to protect their respective economies from overcapacity.

EU must take immediate action, and decisively, prior to all lights go out in significant portions of the EU steel industry and its supply networks.