UK steel industry bosses have warned that US customers are already moving to cancel orders after President Trump imposed 25% tariffs on all steel and aluminium imports.
The business and trade committee of MPs was told that the tariffs would damage sales and profits for an industry that is already uncompetitive internationally, mainly due to high energy costs.
Tata Steel UK’s chief executive Rajesh Nair said $100m (£77m) of sales to the US were in peril.
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“The customers are spooked and the customers are wanting to go to other suppliers to make sure that they don’t get caught in the tariff warfare”, he explained.
“So customers are already talking to us and wanting to cancel orders and in some cases are asking us for compensation for potential orders.”
Allan Bell, chief commercial officer at British Steel, said it had already lost business in areas where there was an alternative US supplier.
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He expected to lose further orders in around nine months’ time when US customers would be in a better position to source alternative steel products.
“We’ve got customers that are concerned about the impact of the tariffs and, at the moment, are considering order cancellation.”
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Both stated disappointment over the government’s response to date but they did not call for reciprocal tariffs.
Instead, the industry demanded speedy action from the Trade Remedy Authority to bolster steel import safeguards as the biggest fear was the UK market being swamped by cheaper alternatives that would have been originally destined for the US.
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While the European Union has responded to the US tariffs with counter measures due to take effect on 1 April, the UK has held back while wider trade talks continue with the Trump administration.
The business secretary Jonathan Reynolds is due in Washington DC later on Tuesday for talks with US counterparts.
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In addition to securing possible exemptions during the trip, the steel bosses told the MPs that what was urgently needed from ministers were import safeguards in line with the EU’s and further assistance with energy bills to bolster competitiveness.
Mr Bell said: “We are paying 50% more for our wholesale energy than competitors in France and Germany.”
