According to UK-based steel supplier All Steels, the UK steel market has entered one of its longest weak phases following the strong conditions of 2021 and 2022. Demand and prices remain at historically low levels, while the broader European economy also shows limited momentum. Recent US protectionist import measures have further undermined European producers’ competitiveness.
In 2024, EU steel exports to the US totaled 3.8 million mt and are now subject to a 50 percent import tax, while UK steel exports of 180,000 mt face a 25 percent tariff. With even higher duties applied to other global suppliers, Europe has become a destination for surplus steel, pushing mills to cut prices to retain market share, often at a loss.
CBAM and new import quotas to reshape market
The European Commission’s new trade policy, combining import restrictions with the Carbon Border Adjustment Mechanism (CBAM), represents a major structural shift. CBAM, scheduled to take effect on January 1, 2026, is expected to add £30-130/mt to import costs depending on origin and carbon intensity.
The revised safeguard system will cap tariff-free imports at 18.3 million mt per year, about half of the current quota, while raising out-of-quota tariffs from 25 percent to 50 percent.
UK expected to mirror EU’s approach
Although the UK government has yet to announce its final position, it is widely expected to implement parallel or coordinated measures with the EU to limit non-EU imports. If EU and UK producers can recover 18-20 million mt of domestic demand, the sector could regain profitability and free capital for decarbonization investments.
All Steels warns that if surplus imports are fully taxed at 50 percent, a sharp price surge will follow.
Existing EU and UK safeguard measures are due to expire on June 30, 2026, but the European Commission aims to ratify new rules earlier, potentially from January 1 or April 1, 2026, pending legislative and WTO approval.
Discussions with European mills and distributors show early reshoring trends, as buyers seek to avoid CBAM-related costs. Traders are withdrawing from Asian markets due to long lead times and tariff risks, tightening import supply in 2026 and shifting pricing power to domestic producers.
All Steels forecasts sharp price increases
All Steels projects that EU and UK steel prices could rise by up to £80/mt in the short term, with increases exceeding £200/mt later in 2026 once protection measures are fully applied. It draws parallels with recent US price movements following the recent trade measures, noting that hot rolled coil rose 27.1 percent to $845/nt ($931/mt), plate 18.3 percent to $970/nt ($1,069/mt), rebar 23.1 percent to $880/nt ($970/mt), and welded pipe 17.4 percent to $1,350/nt ($1,488/mt) in 2025. The company notes that CBAM and tariffs now overshadow all other market variables.
In the near term, aggressive discounting may persist due to seasonality, but mill sentiment is improving as buyers return to local sourcing. All Steels advises partners to prepare for sharp price adjustments, noting that its own prices will reflect expected increases in replacement costs.