Trump steel tariffs are negative for both the UK and the US

Impacting US tariffs on UK steel is “negative” for both countries, business secretaries said.

Jonathan Reynolds told the BBC that the UK and the US have “mutual benefits” in negotiating exemptions from the 25% import tax plan that could come into effect in March.

He said the UK is in a different trading position than other countries and can provide “very specialized” steel and aluminum exports to the US needs, such as the casings of naval submarines made in Sheffield. However, tariffs drive up costs for US taxpayers.

Reynolds’ comments come after the government pledged up to £2.5 billion to support the UK’s steel industry.

President Trump said his tariffs will be enacted “without exceptions or exemptions.”

However, Reynolds told the Laura Quensberg program on Sunday that imposing them on UK steel is “negative to us and negative for the US.”

He said, “We had a very constructive conversation with key people in the Trump administration who recognize that our relationships are different.”

The minister said the programme had a basis for “constructive involvement” between the UK and the US, but “I’m not saying it’s easy.”

He added: “We appreciate that we have an obligation to change how they approach trade issues, but we have different discussions and different stories to communicate to the EU or China in relation to our trading relationship. Masu.”

The government has already said it will not immediately retaliate against the tariffs announced by Trump.

UK steel, the industry’s leading producer, says tariffs will be a “devastating blow” that undermine the annual contribution of £400 million to UK-US trade.

The UK is not a large supplier of steel for the US, and the country accounts for around 10% of UK steel exports.

However, there are concerns within the industry that not only prevent tariffs from exporting to the US, but that the extra steel could be “dumped” in the UK.

This can happen if other countries no longer export to the US. This could result in the decision to offload steel at a cheaper price, and undercutting British steelworks.

Shadow Business Secretary Andrew Griffiths said the “uncertainty” that the steel industry faced due to US tariffs has been completely silent when the government should have spoken to the US, the closest trading partner. There is,” he said.

On Sunday, the government began discussions on the steel program. This explores ways to reverse the long-term challenges facing the industry, including cheap imports that flood the domestic market.

The UK steel industry has faced major unemployment in recent years.

Tata Steel is replacing the old blast furnace with an electric furnace at its Port Talbot site in Wales. Traditional steel making at the site stopped in September, resulting in a cut of 2,800 jobs.

British Steel announced that it would close Scunthorpe’s explosive furnace in 2023 and announced plans to deploy an electric arc furnace.

Asked about Scunthorpe’s potential unemployment, Reynolds admitted that the introduction of new technology has “decreased head counts,” but that if demand for British steel increases, it could create more jobs. I’ve said that.

The government’s plans will address the issue that “has been holding the industry down too long,” the Ministry of Business and Trade (DBT) said:

Identifying expansion of steel production

The talks will also look at the electricity costs of steel companies “to compete in the UK globally,” but the government has yet to make a firm commitment to reducing the energy bill.

Griffith looks forward to seeing the detailed plans, but added, “The clear part must be steps to reduce the cost of energy placing stakes that cannot withstand British steel.”

Sector help will be available through the National Asset Fund. It partners with governments, private sector and local governments to fund infrastructure and other projects.

The government says the financial aid could benefit Scotland and England’s regions, including Scunthorpe, Lincolnshire, Rotherham and Redcar, which have a “strong history of steel production.”

However, DBT said it would “wash no time” in supporting British steel, referring to the government’s support for the expansion of Heathrow Airport, which requires 400,000 tonnes of steel.

The GMB coalition said the government’s plan to support the “troubling” steel industry provided “desperately necessary” funding after “years of dithering.”

“As the world becomes more volatile, major domestic steel manufacturing capabilities are essential for both our economy and domestic security,” added Federal Secretary of State Andy Prendagast.

UK Steel Director Gareth Stace said the government’s commitment to the industry is “important and welcome.”

Information collected during the consultation will be used to help shape the “steel strategy” that will begin in the spring.

Stace added a robust strategy. “We have the power to reverse the decline in sector, especially as we face increased competition from imports that benefit from more favorable business conditions.”

The Liberal Democrats say the government needs to urgently prepare retaliatory tariffs. Deputy leader Daisy Cooper said the UK steel industry is left “dangerously exposed” to the “catastrophic damage” that Trump’s tariffs could inflict.