The British Chamber of Commerce (BCC) has warned that planned changes to the system of quotas and tariffs for steel imports in the UK could significantly increase producer costs and lead to serious disruptions in production supply chains.
In a letter sent to UK Business Minister Peter Kyle, the BCC claims that the proposed measures could cause "real financial and logistical problems" for the processing industries, including construction, engineering and manufacturing. Business groups warned that higher steel prices could lead to a shift in production abroad, an increase in imports of finished products and the attraction of cheaper foreign suppliers.
Under the new system, which is due to take effect on July 1, the UK plans to reduce duty-free quotas on steel imports by a total of 60%, as previously reported by SteelOrbis. https://www.steelorbis.com/steel-news/latest-news/uk-introduces-new-steel-trade-measures-extends-safeguards-to-two-new-products-1446074.htm?searchKey=UK quota&sc=article, exceeding the recently announced reduction by 47 percent by the European Union. It is reported that quotas for some categories of steel products will be reduced to 90%.
At the same time, tariffs on imports exceeding the established quotas will increase from 25% to 50%, which will significantly increase the costs of companies dependent on steel imports.
Manufacturers warn of significant price increases
According to the BCC, many British manufacturers rely on imported steel grades that are not available from domestic suppliers. Industry representatives have warned that the proposed changes could lead to additional costs of millions of pounds, reduced international competitiveness, delayed production and disruption of existing supply chains. Some firms have reportedly indicated that they may have to stop production altogether if specialized steel products become unavailable or excessively expensive.
Manufacturers have also warned that these measures could undermine the UK's climate and industrial policy goals. According to the BCC, companies may be forced to purchase cheaper steel from less sustainable producers.opportunities for foreign suppliers if access to imported steel at competitive prices is limited. This could negatively affect domestic investment in industry, the sustainability of the supply chain, and efforts to move to ground zero.
Businesses require policy adjustments
The BCC has proposed several measures to reduce potential disruptions, including:
- Reducing the scale of quota reductions,
- Phased introduction of the proposed 50% tariff increase,
- Expansion
