UK steel avoids Trump’s 50% tariff for now
UK steelmakers will not be hit with the United States’ newly increased 50% import tariff, at least for now, after a last-minute decision by President Trump to delay its application for British producers.
The new higher tariff, set to replace the blanket 25% duty introduced earlier this year, will begin applying to several countries from today, 4 June.
However, the UK has been temporarily excluded while officials finalise a bilateral trade deal announced last month.
The 25% tariff originally came into effect on 12 March and has continued to apply to UK steel despite a joint Economic Prosperity Deal (EPD) announced by Prime Minister Jonathan Reynolds and President Trump on 8 May.
That deal indicated the UK would be exempt from future US tariffs on steel imports.
President Trump’s latest executive order confirms that the UK will remain under the 25% tariff rate until the agreement is finalised.
A decision on whether to move to a system of tariff-free quotas or impose the full 50% rate on the UK is expected on or after 9 July.
Gareth Stace, Director-General of UK Steel, said the delay offers some short-term reassurance but leaves longer-term questions unanswered.
“The President’s decision not to impose a 50% tariff on UK steelmakers, but to keep the rate at 25% while the UK-US deal is completed, is a welcome pause,” he said. “The Business Secretary, Jonathan Reynolds, recognises that steel trade stability and security between our two nations is of utmost importance and has acted swiftly.”
He added: “Continued 25% tariffs will benefit shipments already on the water that we were concerned would fall under a tax hike. However, uncertainty remains over timings and final tariff rates, and now US customers will be dubious over whether they should even risk making UK orders.”
The US is the UK’s second-largest market for steel exports, worth approximately £400 million annually and accounting for around 9% of all UK steel export value.
Stace said it is critical the UK and US deliver on their May deal to remove tariffs altogether. He also called for the UK government to urgently bolster its domestic trade defence systems, warning of surging imports and price pressures caused by diverted steel following EU trade protections.
“It is also time for the UK Government to take decisive action domestically on trade defence,” he said. “Imports are flooding into the UK market, depressing steel prices and taking away market share. We must not lose sight of our domestic market while battling to stabilise exports to the US.”
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