Rising costs and falling stainless steel demand, down 10–15%, are squeezing UK companies’ profits. This was discussed by participants in a MEPS panel at UK Metals Expo.
The discussion featured UKF Group CEO Christopher Morris, Stainless Steel Services head Darren Moult, Rimex Managing Director Timothy Childs and MEPS stainless steel market analyst Michelle Kirton. The meeting, held on the afternoon of November 5, was chaired by MEPS Head of Price Analysis and Forecasting Kay Ayoob.
As they had during the previous day’s discussion on the UK carbon steel market, participants noted that stocks of imported metal purchased before reduced tariff quotas and 50% duties on above-quota shipments took effect on July 1 were weighing on stainless steel prices. Meanwhile, rising energy and raw material prices are continuing to support the market.
Discussing purchases ahead of changes to the UK’s steel safeguards, Morris said his company had bought significant volumes of products to avoid the new duties.
“We have the biggest stock we’ve ever had in the company’s history. I’m surprised we’re not storing it on the roof. But you’ve got to sell that material as well,” he said.
Morris said EU products remained attractive to the company, as prices in continental Europe were falling. UKF Group’s customers, he added, valued the company’s substantial stocks, which would help ensure supply until January 1, when the UK’s Carbon Border Adjustment Mechanism (CBAM) and related emissions-based import charges come into force.
Kirton noted that falling prices were a major concern for many UK steel-trading companies.
“I think what a lot of people are most concerned about is prices starting to fall. We’ve already seen that in the EU, and the main reason is demand.”
“Prices are supported by factors such as energy costs. But people are worried that the market will turn down, leaving them with large stocks of material bought at inflated prices that they won’t be able to sell.”
According to the participants, weak demand is compounding the risk of being left with expensive stocks. Morris and Moult said their companies’ sales volumes fell by 10–15% in 2026 compared with the previous year. Childs added that the European Commission’s new trade defence regime had introduced rules that could restrict trade for some UK companies. Rising costs for import duties, energy and fuel, he said, were making it harder for UK companies to compete in the EU market.
CBAM and import quotas create new challenges
Childs also pointed out that stainless steel imported into the UK from a European producer and then processed may be subject to a 50% above-quota duty if it is subsequently exported back to the EU.
“There is enough quota for now, but at some point it will become a problem,” Childs said.
UK safeguards are already making things more difficult for steel importers. Moult and Morris said quotas for category 26 welded tubes were insufficient. In their view, restrictions should not apply to products that are not made in the UK.
“We simply can’t source these products domestically. We depend on imports, and there’s no getting around that,” Morris said.
The impact of the UK CBAM is expected to be weaker than previously anticipated. Morris noted that recently published indicative rates for iron and steel, along with default emissions values for certain products, suggested that the charges would be significantly lower than in the EU.
At the same time, participants criticised the lack of clarity surrounding the introduction of the UK CBAM. Morris said the mechanism would take effect in eight to nine weeks, but many companies still did not understand how it would affect their operations or how much it would cost.
“It comes into force in eight to nine weeks, and a lot of people still don’t really understand how it will affect them or what it will cost,” Morris said.
Childs said he hoped the UK government had learned from the EU’s experience and would introduce a clearer CBAM mechanism. However, he added, there were only two months left before it launches, and there was still no clarity.
“At the moment, we don’t really know anything. All we can do is guess and hope for the best,” Childs said.
MEPS publishes an overview of the UK steel market in its monthly European Steel Report. It also includes data collected from market participants in Belgium, France, Germany, Italy and Spain. The report covers steel prices, price indices, market reviews and 12-month price forecasts.
Visitors to the MEPS stand (B16) at UK Metals Expo can also see the new MEPS 360 industry analytics portal. The platform brings together MEPS steel price data and features a customisable interface. Visitors can contact MEPS directly for more information.