The European Union has halved the volume of duty-free steel imports from non-EU countries, but the UK and 12 other nations with free trade agreements (FTAs) with Brussels face a smaller reduction of just one-third. The move, designed to curb cheap Chinese steel, marks one of the most significant post-Brexit divergences in trade relations between the UK and the EU.
Under the new system, total duty-free steel imports from outside the bloc will be cut by 47% on 2024 levels from July 2026. However, the UK has secured a tariff-free quota of 2.14 million tonnes out of a total 9.15 million tonne limit, based on historic trade volumes from 2022 to 2024. The quotas cover 28 product categories, including steel used in automotive and construction sectors.
Despite the preferential treatment, Tata Steel UK, Britain’s largest producer, reported that its guaranteed tariff-free exports to the EU have been slashed by 60%. Chief executive Rajesh Nair said the reduction, combined with recent UK steel import measures, is likely to have a “significant impact” on its business. The UK steel industry had previously warned of “devastating” consequences from the EU’s planned quota system.
EU Trade Commissioner Maroš Šefčovič said the measures ensure “clear and transparent quota distribution rules” for market participants. A senior EU official added that the bloc was “forced” to act due to overcapacity in the global market, particularly after US tariffs under Donald Trump diverted steel to Europe. The official noted that conversations with trading partners were “not easy”.
UK Steel, the industry body, welcomed the deal but expressed hope for “further improvement in volumes as the UK and EU continue their reset talks”. Director general Gareth Stace emphasised the interdependence of the two markets, with 70% of British steel exports going to the EU. “Securing wider export access for certain high value steel products will be critical for the long-term viability of the UK steel sector,” he said.
The new rules effectively quash hopes for a “steel club” alliance between the UK and EU, which would have allowed tariff-free trade and joint efforts against China. Negotiations for a broader trade reset have been postponed to autumn following the resignation of Prime Minister Keir Starmer.
