UK extends lapsing safeguards, steelmakers express relief

The UK government has decided to extend safeguard quotas for a further two years to end-June 2024 on the five categories of steel products on which they are set to lapse next week, Kallanish notes.

The decision has been lauded by UK Steel, whose director general, Gareth Stace, says the move “will guard against anticipated surges in imports from trade diverted away from the US and EU markets that will remain shielded for years to come. Such surges would have risked jobs, investment, and our ability to transition to net-zero”.

‘We are aware this extension was not straightforward. Establishing a trade remedies framework for the first time in fifty years was always going to be challenging and the nature of these measures virtually guarantees some opposition from one quarter or another,” he continues. “However, this is not sufficient reason to shy away from using the trade tools now at our disposal.” The move ensures “steelmakers are not left to the mercy of a global steel market that suffers from overcapacity and state-induced distortions.”

“It is vital we now work with partners like the EU, and the US to address the underlying issues that are destabilising global steel markets. Safeguards are not a long-term solution, and the goal here is a global market for steel where we all play by the same rules,” Stace concludes.

In June 2021 the UK Trade Remedies Authority recommended to extend safeguard measures on ten products for a further three years, with nine slated to be revoked. The government then used emergency legislation to extend measures for one year on five of the categories that were proposed to be revoked. These were categories 6, 7, 12, 16 and 17 – tin mill products; quarto plate; merchant bar and light sections; wire rod; and angles, shapes and sections.

The government has now decided that if the measure were discontinued, there would be serious injury or the threat of serious injury to UK producers. Moreover, UK producers are adjusting to the surge in steel imports, as required under the WTO Safeguards Agreement, it says. However, due to supply problems with category 12, the government has increased the tariff rate quota on category 12a by 126,136 tonnes to ensure it better reflects trade flows.

Adam Smith Poland