[Ferro-Alloys.com]Protectionism and UK steel
First up is a preliminary decision by the UK Department for International Trade to remove a number of products from so-called import “safeguards” adopted from Britain legacy rules in the European Union. The safeguards aimed to protect domestic producers from cheap imports.
The system sets quarterly quotas for steel products that come in with nominal duty. When the country reaches the quota, a massive 25% tariff comes into play to dissuade larger volumes.
The lobby group UK Steel, representing the industry, warned that the removal of protections would have an adverse impact on steel manufacturers in Wales and northeast England.
“The UK will become a magnet for huge volumes of steel imports, it is beyond worrying to consider the damage this could do to the UK steel sector and its long-term viability,” the Financial Times quoted the group as saying.
UK steel producers object
The producers’ fears are understandable. The group is seeking to block amendment to all categories, apparently on the “thin end of the wedge” argument that a change to any of them opens debate about all of them.
Yet the Department for International Trade has said it intends to extend the measures on 10 categories of imports for a further three years from next month to protect domestic producers. However, it has also said that measures on a further nine categories will be revoked on the grounds those cover products not manufactured in the UK.
The steel industry may support some 33,000 jobs. However, many, many, more exist further down the supply chain from consumers of steel products in the manufacturing industry.
Those downstream consumers have to pay higher prices for imported steel products for which there is no domestic producer. That is a senseless position for the country to adopt. It is tantamount to hamstringing your manufacturing companies on the world stage in the interests of … well, no one really. Dogma, maybe?
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