UK-US Trade Deal in Jeopardy as Steel Tariffs Loom

The UK's effort to finalize a deal with the US on steel tariffs is facing significant challenges as the deadline set by President Trump approaches. The deadlock stems from disagreements over the types of steel that will be covered by the new zero-tariff quota system agreed in principle under the US-UK trade agreement. The largest steel producer in the UK, Tata Steel, may be ineligible for the scheme due to changes in its production process. The industry is also concerned that some US customers are holding back on orders in anticipation of a zero-tariff deal.

Key Takeaways:

• The UK and US are struggling to reach an agreement on the types of steel that will be covered by the new zero-tariff quota system under the US-UK trade agreement.
• The largest steel producer in the UK, Tata Steel, may be ineligible for the scheme due to changes in its production process.
• The industry is concerned that some US customers are holding back on orders in anticipation of a zero-tariff deal.
• Senior government sources have expressed little optimism that an agreement can be reached by the deadline of July 9, but are hopeful that President Trump will not increase tariffs to 50%.
• The US government is considering sending letters to countries with details of higher tariff rates, which will start on August 1.
• The import duties will range from 60-70% to 10-20% tariffs.

Statistics:

• 50% tariffs on British steel and aluminium exports to the US were temporarily exempted by President Trump.
• 90-day deadline for countries to do a trade deal with the US or face "liberation day" tariffs of up to 50% is expiring on July 9.
• Only Vietnam has agreed a trade deal in principle with the US.
• President Trump said the US would start sending out letters to countries detailing higher tariff rates on August 1.

Sources:

• Oxford Times
• UK Steel (trade group)
• Government sources
• US President Donald Trump (quotation)