A spokesman for Eurofer, the European Steel Association, said in an emailed statement: “It’s positive that they could agree on an extension of a certain length. That alone provides more certainty in the near term that we had previously. However, if the political process in the UK proceeds in a way which is rocky, this might well bleed through into economic uncertainty, especially if there is no sign of any deal being passed towards the end of the extension.”
The government has already announced that in the case of a no-deal Brexit, tariffs on imports of base metals, excluding aluminum, will be reduced to 0% from 1.8%. Aluminum will be cut from 6.3% to 0%, with steel and iron little changed, with tariffs falling from 0.8% to 0%. A tariff reduction would be designed to soften the blow and reduce costs for domestic importers and processors, who would not be able to take advantage in a no-deal scenario of import safeguards negotiated by the EU.
If however, a withdrawal deal is reached with the EU, the UK government has stated that it will be able to enforce safeguards on steel imports from third countries into the UK, in line with those formally introduced by the European Commission in early February in response to the US tariffs on steel import under Section 232.
However, a lawyer contacted by S&P Global Platts at the time clarified that these antidumping measures cannot be transposed to the UK in the case of a no-deal Brexit. “In case of no deal, any AD duties will have to be imposed from scratch following a formal investigation,” the lawyer said.
— Diana Kinch