By City A.M - Mar 12, 2025,
US tariffs on steel and aluminum imports have come into force, impacting UK exports and creating uncertainty for British businesses.
Industry leaders express disappointment and warn that the tariffs will further challenge the UK's struggling steel industry, which already faces high energy costs and subdued demand.
The UK government plans to take a "cool-headed" approach to the tariffs, engaging with the US while defending national interests, despite concerns about potential trade deficits and market flooding.
UK industry heavyweights have branded Donald Trump’s tariffs on steel and aluminium imports a “difficult day for transatlantic trade” that will put “considerable pressure” on the UK’s metals sector.
Tariffs on the two widely-used commodities came into force on Wednesday morning, meaning all UK steel and aluminium exports to the US will now be subject to a 25 per cent levy.
The duties were first announced last month, and bosses from the UK’s steel and trade sectors lamented the fact the UK was unable to negotiate an exemption.
William Bain, head of trade policy at the British Chambers of Commerce (BCC) told City AM that the tariffs represented a “lose-lose scenario” for British and American firms.
“The introduction of tariffs will be a difficult day for transatlantic trade and will plunge businesses, in both the US and UK, into a new age of uncertainty,” he said.
Meanwhile leading figures from Britain’s metals sector branded the levies “hugely disappointing” and warned they will serve only to further hamper the UK’s struggling steel industry.
Gareth Stace, director general of UK Steel, said: “Our steel sector is not a threat to the US, but a partner to key customers.”
“These tariffs couldn’t come at a worse time for the UK steel industry, as we battle with high energy costs and subdued demand at home, against an oversupplied and increasingly protectionist global landscape,” he added.
Nadine Bloxome, chief executive of the Aluminium Federation, told City AM that her sector had already been forced to deal with preemptive shifts in trade patterns.
Semi-finished goods could soon “flood the UK market” undermining domestic producers already contending with high energy costs and burdensome regulation, she said.
On Tuesday, Keir Starmer pledged not to respond with immediate counter-tariffs, in a departure from the approach adopted by the European Union, Canada and Mexico.
UK to take “cool-headed” approach to tariffs
Downing Street’s official spokesman said the the government was engaging “closely with the US administration to make the case for the UK to be exempted from proposed tariffs”.
He added: “When it comes to the UK steel industry we remain prepared to defend the UK’s national interest where it’s right to do so. But we will continue to take a cool-headed approach to any speculation around tariffs.”
The US accounts for just five per cent of UK steel exports, and six per cent of aluminium exports, according to the Office for National Statistics, and steel trade to the US is worth over £400m.
Business secretary Jonathan Reynolds had previously warned that steel tariffs would damage both the UK and US, and Starmer’s decision not to engage in a tit-for-tat response sparked a warning from UK Steel’s Stace.
He said Britain’s steel industry could be left especially vulnerable to US and EU exporters flooding the UK, worsening its trade deficit.
By City AM
Steel at heart of new Trump trade war
By AFP
March 12, 2025
Steel is at the heart of US President Donald Trump's new tariffs - Copyright AFP Geoff Caddick
Isabel MALSANG
US President Donald Trump’s new tariffs on steel target a major industry that is found in everything from cars to buildings but was already facing a range of challenges.
The 25-percent tariffs, which also hit US imports of aluminium, came into effect at midnight in Washington, hitting numerous nations from Brazil to South Korea, as well as the European Union.
Washington has framed the tariff moves as a bid to protect US steel and American workers as the sector declines and faces fierce overseas competition, especially from Asia.
– Who exports steel to the US? –
Global steel production hit 1.84 billion tonnes in 2024, a 0.9 percent drop from the previous year, according to the latest figures from the World Steel Association trade body.
China is the biggest producer, accounting for more than half of world output with more than one billion tonnes.
The United States stands in fourth place with 79.5 billion tonnes, which was down 2.4 percent from 2023.
The world’s biggest economy imported 26.4 million tonnes of the alloy in 2023, making it the second-largest market for foreign steel behind the European Union.
Canada tops the list of the United States’ biggest steel providers, exporting 5.95 million tonnes to its southern neighbour last year, according to the US Department of Commerce.
Brazil was next at 4.08 million tonnes followed by the European Union at 3.89 million tonnes, Mexico at 3.19 million and South Korea at 2.5 million.
While China’s total steel exports hit 111 million tonnes in 2024 — a nine-year high — only 470,000 tonnes were shipped to the United States.
– Why is Trump complaining? –
Global overproduction has caused steel prices to plummet in the past year.
Where the steel economy of the past half-century cycled through periods of shortage and plenty, today it faces a structural problem of too much steel being produced, experts say.
That surplus stands at around half a billion tonnes, according to the Organisation for Economic Co-operation and Development.
Many experts point to China being responsible for most of that overcapacity, and there are suspicions that Beijing has subsidised steelmakers.
This month, China said it would cut output by its massive steel industry to address overcapacity and halt plunging profits in the sector, without providing details.
– Is overcapacity to blame? –
Some analysts argue that overcapacity is not the main culprit.
Marcel Genet, a steel expert and head of the French consultancy Laplace Conseil, said the problems in the industry stem mainly from the lack of competitiveness of old blast furnaces.
Such furnaces produce steel from iron ore and coal, compared to steel made from recycled scrap in electric arc furnaces, which is much cheaper to produce.
Companies with “traditional blast furnaces don’t have the funds to finance their energy transition”, meaning they are unable to replace coal “without massive state aid”, Genet said.
Moreover, US and European steelmakers are under pressure as their exports have been dropping for the past half century as emerging countries develop their steel industries, he added.
Japan’s Nippon Steel sought to buy struggling rival US Steel, but the bid was blocked by former president Joe Biden and now Trump.
In Europe, around 50 blast furnaces remain, Genet said.
Most are operating at under 70 percent of capacity and have halted plans to invest massively in lower-emissions projects.
– What happened last time? –
Trump had already imposed tariffs of 25 percent on steel and 10 percent on aluminium during his first term in office in 2017-2021.
The last 12 blast furnaces in operation in the United States are owned by US Steel, which is based in Pittsburgh, Pennsylvania, and Cleveland Cliffs in the state of Ohio, both key states in US elections.
The move had a very limited impact, said Ruben Nizard, an economist at French insurer Credit Coface.
US imports of steel fell by 24 percent over the period and imports of aluminium by 31 percent, according to a report by the US International Trade Commission.
“No clear benefits have emerged, either in terms of employment or production, and prices have increased,” Ruben Nizard points out.
By AFP
March 12, 2025
Steel is at the heart of US President Donald Trump's new tariffs - Copyright AFP Geoff Caddick
Isabel MALSANG
US President Donald Trump’s new tariffs on steel target a major industry that is found in everything from cars to buildings but was already facing a range of challenges.
The 25-percent tariffs, which also hit US imports of aluminium, came into effect at midnight in Washington, hitting numerous nations from Brazil to South Korea, as well as the European Union.
Washington has framed the tariff moves as a bid to protect US steel and American workers as the sector declines and faces fierce overseas competition, especially from Asia.
– Who exports steel to the US? –
Global steel production hit 1.84 billion tonnes in 2024, a 0.9 percent drop from the previous year, according to the latest figures from the World Steel Association trade body.
China is the biggest producer, accounting for more than half of world output with more than one billion tonnes.
The United States stands in fourth place with 79.5 billion tonnes, which was down 2.4 percent from 2023.
The world’s biggest economy imported 26.4 million tonnes of the alloy in 2023, making it the second-largest market for foreign steel behind the European Union.
Canada tops the list of the United States’ biggest steel providers, exporting 5.95 million tonnes to its southern neighbour last year, according to the US Department of Commerce.
Brazil was next at 4.08 million tonnes followed by the European Union at 3.89 million tonnes, Mexico at 3.19 million and South Korea at 2.5 million.
While China’s total steel exports hit 111 million tonnes in 2024 — a nine-year high — only 470,000 tonnes were shipped to the United States.
– Why is Trump complaining? –
Global overproduction has caused steel prices to plummet in the past year.
Where the steel economy of the past half-century cycled through periods of shortage and plenty, today it faces a structural problem of too much steel being produced, experts say.
That surplus stands at around half a billion tonnes, according to the Organisation for Economic Co-operation and Development.
Many experts point to China being responsible for most of that overcapacity, and there are suspicions that Beijing has subsidised steelmakers.
This month, China said it would cut output by its massive steel industry to address overcapacity and halt plunging profits in the sector, without providing details.
– Is overcapacity to blame? –
Some analysts argue that overcapacity is not the main culprit.
Marcel Genet, a steel expert and head of the French consultancy Laplace Conseil, said the problems in the industry stem mainly from the lack of competitiveness of old blast furnaces.
Such furnaces produce steel from iron ore and coal, compared to steel made from recycled scrap in electric arc furnaces, which is much cheaper to produce.
Companies with “traditional blast furnaces don’t have the funds to finance their energy transition”, meaning they are unable to replace coal “without massive state aid”, Genet said.
Moreover, US and European steelmakers are under pressure as their exports have been dropping for the past half century as emerging countries develop their steel industries, he added.
Japan’s Nippon Steel sought to buy struggling rival US Steel, but the bid was blocked by former president Joe Biden and now Trump.
In Europe, around 50 blast furnaces remain, Genet said.
Most are operating at under 70 percent of capacity and have halted plans to invest massively in lower-emissions projects.
– What happened last time? –
Trump had already imposed tariffs of 25 percent on steel and 10 percent on aluminium during his first term in office in 2017-2021.
The last 12 blast furnaces in operation in the United States are owned by US Steel, which is based in Pittsburgh, Pennsylvania, and Cleveland Cliffs in the state of Ohio, both key states in US elections.
The move had a very limited impact, said Ruben Nizard, an economist at French insurer Credit Coface.
US imports of steel fell by 24 percent over the period and imports of aluminium by 31 percent, according to a report by the US International Trade Commission.
“No clear benefits have emerged, either in terms of employment or production, and prices have increased,” Ruben Nizard points out.
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