From 1st June, 2022, UK steelmakers and whiskey makers exporting to the US are able to enjoy a reduced tariff – up to a certain tonnage, after which the full tariff will apply.
This agreement between the UK and the US comes after 4 years of negotiations, following the application of 25% duty on steel and 10% duty on aluminum by President Donald Trump – who called foreign metals a threat to US national security.
Boris Johnson tweeted on the agreement earlier this year:
“This is fantastic news and a very welcome boost to our steel and aluminum industries.”
What does this mean for companies exporting steel to the US?
Previously, companies exporting to the US have needed to compete with lower manufacturing costs in China, along with the anti-dumping duty (known as section 232 tariffs in the US) reliefs that were recently granted to Japan and the EU.
This new deal enables UK exporters of steel to compete in the US market again. Although, the allowance for the UK is lower in proportion to the Japan and the EU:
– UK companies exporting to the US have relief for the first 550,000 tonnes of finished steel, and the first 900,000 tonnes of aluminum products.
– Japan can export 1,250,000 tonnes of steel before their relief expires. The JP-US deal does not include aluminum.
– The EU has a quota of 3,300,000 tonnes of finished steel, and 18,366 aluminum products, before full duty applies.
Commenting on the implementation of the UK-US Section 232 deal, UK Steel Director General Gareth Stace said:
“This is a significant day for the UK steel companies and their customers in the US. The implementation of this hard-fought deal marks a major improvement in the trading environment for UK sector and our thanks go to the Secretary of State and her team for getting this deal over the line and into effect.
From today UK steel producers will again be able to sell steel to American consumers tariff free giving them a critical competitive advantage over global competitors and allowing them to recover market share lost in the years since tariffs were imposed. Today marks the start of a comeback for UK steel in the US, and we welcome the reopening of this important market for UK producers once again.”