Steel trade
new challenges in 2026

We find ourselves at a pivotal point for the UK steel industry, a time of monumental challenge but also great opportunity.

The UK's steel industry risks being squeezed out both at home and abroad - with hard-hitting US tariffs, and other countries following suit - including the EU unveiling a plan to slash import quotas, with potentially devastating results for UK steelmakers.

A major challenge confronting steel producers across the US, EU, and UK is the growing mismatch between global supply and demand - driven largely by China, where state subsidies for steel production are around ten times higher than the OECD average. In our home market, UK steel producers’ share is already dwindling. UK steelmakers provide only 30% of market demand and imports continue to eat away at this share.

UK Steel leading the way developing new trade shields
Including an initial report in October 2024, putting forward concrete policy recommendations on new trade options. Bold action on trade policy today will secure jobs, skills, economic prosperity and resilience for generations to come. 

Steel trade disruption 2025

Changes to UK trade remedies are a welcome first step to tackling trade challenges
April 2025: The Chancellor and Secretary of State for Business and Trade provided a clear signal that fairness has to underpin our approach to global trade. The Trade Remedies Authority (TRA) has been directed to increase resourcing in its pre-application office, take a more proactive approach in trade flow monitoring and speed up the pace at which investigations are completed. 
Trade remedies, including anti-dumping, anti-subsidy and safeguarding measures are extremely complex tools that require a high evidentiary threshold, often take a year to implement and are highly resource intensive for industry to undertake.  
While trade remedies are an essential part of the toolkit to address unfair trade, there is an increasing recognition globally, including by the EU, that traditional trade remedies tools are increasingly unable to meet the scale of the challenge.
New Trade Strategy to arm Government with the weapons to defend industries such as steel
June 2025: The Trade Strategy will enable the Government to counter unfair trade and deliver a level playing field so that UK companies can compete.
Secretary of State backs UK Steel proposals to tighten existing steel safeguards
June 2025: UK Steel’s recommendations to strengthen existing steel safeguard measures were taken forward today after the Secretary of State stepped in at a critical time for industry. The Government accepted UK Steel’s arguments to limit the liberalisation of the existing steel import quotas to 0.1%, down from 3.0% previously, in line with the measures taken by the European Union. These safeguards expire in June 2026.
Government calls on steel companies to contribute to post-safeguard trade defence design
June 2025: The Department for Business and Trade called for evidence from steel producers as it begins work on a new system to replace the UK’s steel safeguards, which are due to expire in June 2026.
Originally introduced as an emergency, temporary measure to prevent import surges from overwhelming the UK market, the safeguards have become less effective as their quotas have been gradually liberalised each year. 
With the 2026 deadline approaching, the Government must now establish a successor mechanism. UK Steel is advocating for a robust new strategy that restores fairness to the market, supports the restart of idle capacity, grows domestic market share towards 60%, and strengthens the wider supply chain.
US steel tariffs implemented from March, UK benefits from world best reduced tariff rate
July 2025: UK steel has steered clear of US tariff hike and remains at 25% import - and benefits from the lowest import tariff in the world.
UK steelmakers will steer clear of President Trump’s 50% steel import tariff that was hiked up in June 2025. The 50% tariff being applied to other nations is set to replace the broad brush 25% tariff the President slapped on all steel imports earlier this year, which came into effect on 12 March.
EU unveils plan to slash import quotas, with potentially devastating results for UK steelmakers
October 2025: The UK steel industry’s access to the European Union, by far our most important export market, could be severely curtailed after measures announced in Brussels. The proposal set out by the European Commission would slash existing tariff-free import quotas to around 18 million tonnes, while the out-of-quota tariff would be doubled to 50%. The prospect of a sharp reduction in EU imports is a major concern for UK steelmakers. The EU market is the destination for 78% of all UK steel exports, totalling 1.9 million tonnes of steel in 2024. 
The UK Government must respond in two ways: 
  • Negotiate preferential treatment for the UK, including country-specific quotas
  • Put in place its own tightened import quotas
Excess steel in the global steel market
One of the most significant challenges facing steel manufacturers in the US, EU and UK is the imbalance between demand and supply, with China subsidising its steelmakers’ production at ten times the OECD average. Chinese steel exports have more than doubled since 2020, reaching a record level of 118 million tonnes in 2024. The Middle East and Southeast Asia are also significantly expanding capacity.

The OECD Steel Outlook 2025 shows that excess capacity is projected to rise to 721 million metric tonnes (mmt) by 2027. 
The OECD noted that "During 2024,19 governments initiated 81 antidumping investigations involving steel products, a five-fold increase from the 2023 level and near the 2016 steel crisis level. Almost 80% of the cases were initiated against Asian producers, with China alone accounting for more than one-third of the total."

Knock-on market effects

Capacity expansions in steel

Capacity expansions in Southeast Asia and the Middle East are continuing at an alarming rate – these are largely state-funded, mostly for high-emission blast furnaces and often do not correspond to domestic demand trends. Indeed, steel demand is weakening in key markets, notably China, translating into rising oversupply which is dampening steel prices and spilling over into other markets.

In the UK

The import share in 2024 has jumped to 70%, from 60% in 2023 and 55% in 2022. The sharpest import increases have come from non-EU sources, mainly India, Vietnam, China, South Korea, Turkey and Algeria. Importantly, these are also countries that have seen significant increases in imports from China or are within China’s top 10 exporting destinations.

Driving up emissions

Blast furnaces, which are the more carbon intensive steelmaking technology, account for more than 74% of capacity additions in Asia, while 89% of blast furnace energy input globally comes from coal. Over two thirds of steelmaking capacity is in countries that have Net Zero targets later than 2060 or none at all.

Rising protectionism: USA

US Section 232 tariffs, placing a 25% blanket tariff on all steel imports, were introduced in 2018 and will remain in place for the foreseeable future. The US has continued to add further tariffs on Chinese imports and strengthen its trade remedies system.

Expiring in 2026: EU and UK steel safeguards

The EU and UK had responded to the US measures, and the trade diversion they would cause, with safeguards which introduced tariff-rate quotas, but these are due to expire in 2026. The EU is also now stepping up its trade defence with new measures in 2026 that could devastate UK business.

Rising protectionism: rest of the world

Canada recently imposed a 25% tariff on steel imports from China, while several other countries are also acting to shield their industries from trade diversion through safeguards and anti-dumping measures, including South Africa, Brazil, Turkey, Vietnam, India and Malaysia.