LONDON — British and American officials have restarted talks on steel tariffs in the run-up to U.S. President Donald Trump’s state visit next week.
After months of radio silence over the summer, negotiations to implement new quotas lowering the duties on steel and aluminum exports to the U.S. began again earlier this month, two people close to the talks told POLITICO.
It comes as Donald Trump prepares to travel to the U.K. for a historic second state visit, with British officials hoping to use the occasion to push for a breakthrough on tariffs as well as a long-coveted tech partnership.
Britain’s steel and aluminum makers have faced 25 percent tariffs at the U.S. border since March. While U.K. firms dodged Trump’s doubling of those duties in the spring, negotiations to lower tariffs further — as promised in May’s trade pact — have been slow-moving.
The talks are also politically sensitive for Britain’s governing Labour Party, which is facing pressure from the insurgent Reform UK party in the country’s industrial heartlands.
“We know they’ve been talking about steel again and looking at the U.K.’s proposal on quotas,” said one of the people familiar with the negotiations. Like others quoted in this report, they were granted anonymity to speak freely about ongoing talks.
U.K. trade officials “really want to get something over the line,” said the second person familiar with the talks, noting that the discussions were “quite advanced before the pause over the summer began.”
‘Rapid discussions’
During a split-screen Oval Office phone call in May, Trump and Prime Minister Keir Starmer announced an agreement promising “rapid discussions” to secure a quota for U.K. exports of the metals.
The deal would allow a certain amount of steel, aluminum and their derivative products to pass from the U.K. into the U.S. at tariff rates significantly lower than 25 percent.
When Trump visited Scotland in July, he said a reduction in his tariffs on U.K. steel and aluminum would come “pretty soon.”
But five months after the May deal was signed, the U.K. is still lobbying U.S. Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick to get the White House to put those quotas in place.
“The longer this goes on, the more uncertain it is, the more damaging it is, the less likely we are going to get growth, and the more threat there is to the jobs that are associated,” said Chris Southworth, head of the International Chamber of Commerce UK.
There is “a great opportunity” to conclude the steel talks on the fringes of the state visit, Southworth added. “We need a solution quickly.”
Melt and pour rules
The U.S. has strict rules on imports of steel and aluminum, meaning the metals must be melted and poured in their country of origin to qualify for tariff relief.
But the requirements have been a tall order for Britain’s steel sector after its largest exporter to the U.S. — Tata Steel UK’s Port Talbot steel mill — shut last September.
The firm is switching to greener arc furnaces which aren’t expected to start operating until 2027. In the meantime, the firm has been importing steel from its plants in India and the Netherlands.
“I don’t think these are unmanageable issues,” said a person briefed by the White House. “If the U.K. can figure out how to agree to the ring-fencing demands of the U.S., then I think it should be pretty easy.”
One solution, they said, “could be they just have a lower … quota to protect against the Indian steel coming through, and then have an agreement to raise it automatically once [Tata’s Port Talbot site] comes back online.”
Trump’s state visit is “exactly the kind of opportunity to make an announcement in front of the TV cameras,” the first person quoted above said. “If it’s not now, I worry about when it will ever happen.”
“We are committed to going further to give industry the security they need,” said a U.K. government spokesperson. “We will continue to work with the US to get this deal implemented as soon as possible and in industry’s best interests.”
The post UK and US restart steel talks ahead of Trump’s state visit appeared first on Politico.
