Blog: UK could be flooded with cheap steel after Brexit expiry date in blow to British industry – Mirror Online

Steel chiefs have urged the Government to extend “safeguards” aimed at supporting the industry against cheap foreign imports.

Measures have been in place since 2018 when the UK was part of the EU, and were extended as part of the Brexit transition period.

But they are due to expire next month – prompting fears among producers of a flood of metal from abroad.

UK Steel believes the US and EU will extend their safeguards – and want International Trade Secretary Liz Truss to do the same for Britain.

In a three-page briefing note seen by the Mirror, the trade body says: “Extending the UK safeguards is the only sensible course of action whilst the US and EU continue with their own measures and global overcapacity remains as big a problem as ever.

“To do otherwise would unilaterally expose the UK market to significant increases in imports at a time when the steel sector, like the rest of the economy, is in the process of recovery.”

The industry is putting pressure on Trade Secretary Liz Truss
(Image: REUTERS)

The British regime sets tariff-free quotas for a range of steel products based on 2015-2017 levels of imports.

Only once they have been filled are tariffs applied to any extra imports over a three-month period.

UK Steel’s briefing note says: “The measures were introduced to limit further increases in imports because of a dysfunctional global trading environment for steel, namely: global overcapacity of steel, trade diversions resulting from US introduction of steel tariffs, and increased use of trade defence measures globally.

“The measures allow for tariff-free imports equivalent to 111% of historic levels, with further relaxations every year.

“This provides a careful balance between different industrial interests.”

It says the deadline offers a crucial early test of the UK’s post-Brexit plan for heavy industry.

“If the UK unilaterally removes its measures, it will open our market to import surges as the sector recovers from Covid-19, and crucially at a time when our exports to the EU and US will still be subject to tariffs and quotas,” warns UK Steel.

“This is the first test for the UK as an independent trading nation and an opportunity to demonstrate that UK will use its newfound trade policy independence and the international rules-based system to provide a fair-trading environment for the UK steel industry.”

The regime was introduced by Brussels in 2018 after Donald Trump’s administration suddenly slapped 25% tariffs on all steel imports from the EU.

British and European leaders believed they needed to retaliate with their own defensive measures.

Writing exclusively for the Mirror, Community steelworkers’ union boss Roy Rickhuss says: “The UK’s steel safeguards must be maintained and extended beyond June, because our world-class steelworkers need Government to back them and support our strategic industry of the future.

“The safeguards were introduced due to global overcapacity and the threat of trade diversion resulting from the US steel tariffs, and in a climate of growing nationalist and protectionist sentiment worldwide.

“These were compelling reasons then and they remain so today.”

Britain’s steel industry directly employs 33,700 workers, with another 42,000 supply chain jobs,

according to UK Steel.

Salaries are 33% higher than the national average – and 45% higher in Wales and Yorkshire and Humber where the sector is concentrated.

The industry is worth £2.1billion to Britain’s economy.

But 3,300 posts are in jeopardy at Liberty Steel’s 11 UK plants following the collapse of its main lender, Greensill Capital, in March.

‘Government failed our steelworks before – it must not repeat the same mistake now’

Community steelworkers’ union general secretary Roy Rickhuss writes exclusively for the Mirror.

These are challenging times for our steel industry, but the market is on the up and our sector has a crucial role to play in the nation’s post-pandemic recovery.

There is no doubt our industry can have a bright future at the core of a low carbon economy, but this will require decisive Government action so our steelworkers can compete on a level playing field.

Extending the steel safeguards is a vital part of this, to protect our steelmakers from the consequences of devastating import surges as we recover from the impacts of Covid-19.

The safeguards were introduced due to global overcapacity and the threat of trade diversion resulting from the US steel tariffs, and in a climate of growing nationalist and protectionist sentiment worldwide.

These were compelling reasons then and they remain so today.

It should be inconceivable that a Government committed to British industry would choose to leave our steel sector unprotected, when the EU and the US are set to maintain their own defences.

This decision on extending the steel safeguards is the first major test of the Government’s commitment to our steel industry post-Brexit.

Overcapacity and steel dumping was a major factor in the collapse of the SSI steelworks on Teesside in 2015.

Government failed our steelworkers then, and this was a tragedy that must never ever be repeated.

Britain needs our steel. Government making the wrong choice could be disastrous for our steel communities, cost thousands of jobs and rob us of our capacity to produce this crucial resource domestically.

The UK’s steel safeguards must be maintained and extended beyond June, because our world-class steelworkers need Government to back them and support our strategic industry of the future.

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