The UK Government has announced a new steel strategy aimed at stabilizing and rebuilding the domestic steel sector, introducing stronger trade protection and financial support measures. The strategy includes a new steel trade measure with tariffs of up to 50 per cent, as well as up to £2.5 billion in funding to support the industry and attract investment.
The Government has said its initial target is to restore domestic production levels to around 40-50 per cent of UK demand, up from around 30 per cent in 2024. The strategy sets out a long-term vision for a competitive and decarbonized steel industry, supported by investment and improved operations.
New trade measures
A key element of the strategy is the introduction of a new system of tariff rate quotas, which will replace the current steel protection system when it expires in June 2026.
According to with the new system:
- quota volumes will be significantly reduced by 60 percent compared to existing levels of protection,
- additional product categories will be covered,
- an out-of-quota tariff rate of 50 percent will be applied.
This measure will come into force on July 1 2026 and aims to ensure the continued viability of domestic steel production.
Financial support and investment measures
The plan includes up to £2.5 billion to support the recovery and modernization of the industry, as well as wider funding instruments such as the National Wealth Fund.
The Government has also highlighted existing interventions, including support for Tata Steel's transformation into Port Talbot, intervention to support operations at British Steel and investment in Sheffield Forgemasters
Demand for steel in the UK is expected to grow over the coming decades, driven by sectors such as construction, infrastructure and clean energy, according to the data. The Government said this creates opportunities for new investment, including in areas where domestic production capacity is currently insufficient. Commenting on the new strategy, UK trade body UK Steel said: “The Steel Strategy is a significant step forward in delivering a competitive and sustainable future.
