The UK steel industry has criticized the government’s plans to remove tariffs on imports of a wide range of products, describing them as a “hammer blow” that risks damaging the sector in the long run.
According to UK Steel, a preliminary decision by the Department of International Trade to exempt large numbers of products from so-called import “safeguards” intended to protect domestic producers against a flood of cheap imports must be “rethought. emergency”.
The lobby group said the move was a first test for the UK as an independent trading nation after Brexit and warned that removing protections would negatively impact steelmakers in Wales and in the North East of England.
‘The UK will become a magnet for huge volumes of steel imports, it is beyond worrying to consider the damage this could cause to the UK steel sector and its long term viability Said Gareth Stace, Managing Director of UK Steel.
“This is the first test of the government’s commitment to our steel industry after Brexit and they are failing,” said Alasdair McDiarmid, director of operations for the steelworkers’ union.
Safeguards set tariff-free quotas for a range of steel products based on the level of imports between 2013 and 2017. Once quota thresholds are exceeded, tariffs are applied to any additional imports over a three-month period. . They have been in place since 2018, when the UK was still part of the EU, and have been extended as part of the Brexit transition period, which ended in December.
According to plans released on Tuesday, the Trade Remedy Investigations Directorate, an independent body of the DIT, recommended extending measures on 10 categories of imports for three years from next month.
He also suggested that measures concerning nine categories be repealed. The agency stated that in these categories it found that there was no domestic production, that the increase in imports was not large enough or was not likely to cause injury to the industry. of national production.
UK Steel said removing the protections would negatively impact the manufacturing of steel profiles in Teesside, tubing in Hartlepool and wire rod made in Cardiff, Scunthorpe and Rotherham. She added that the measures were designed to protect the “viability of an entire industry, not individual production chains”.
The industry employs over 33,000 people directly in the UK and supports another 42,000 in supply chains.
The largest UK steel companies include Tata Steel, based at the Port Talbot plant in South Wales; British Steel, owned by the Chinese group Jingye, which manages the giant Scunthorpe site; and Liberty Steel, owned by GFG Alliance.
British Steel said it was “extremely disappointed”, warning that if the plans were accepted it would be a “major setback for British manufacturers who have pledged to help rebuild” the British economy.
UK Steel said the inclusion of more comprehensive trade data shows there has been an increase in imports across the board.
Sir Andrew Cook, chairman of family-owned Sheffield steelmaker William Cook, said lower tariffs would hurt UK industry and Chinese producers are already dumping substandard steel into the UK at a price lower than its cost price.
“It wasn’t until recently that I was offered 1 million tonnes of brand new Chinese-made steel rails for $ 150 per tonne. That’s half of their scrap value. How can a Western steel company compete with this “sell at any cost” behavior? Cook said.
The company manufactures rails, tracks and machine components. Cook said China seeks to create monopolies by undercutting Western manufacturers.
“Sooner or later, monopoly established, China will raise the price.”
DIT said: “We have a strong framework for trade remedies through TRID to protect UK producers against unfair trading practices and unanticipated import surges. This government supports free trade for British steelmakers.
“The Secretary of State has limited powers with respect to the TRA, and has the choice only under the law to accept the recommendation of the TRA, or to have the safeguards expire on their date. end.”
Industry stakeholders have seven days to appeal. The final decision will be made by Liz Truss, Secretary of International Trade.