The imposition by Donald Trump of 25% steel and aluminium tariffs, followed in early April by a minimum 10% tariff on all goods imported into the United States has unleashed a wave of retaliatory measures – some justified, some opportunistic. The brazen, “detail free” nature of Mr Trump´s approach has emboldened countries across the steel world to put their own barriers in place to deter imports. Such measures go by various names, including: “safeguards”, “border adjustment schemes”, “reciprocal tariffs” and “anti-dumping actions”. However, they all amount to the same thing: an attempt to protect local manufacturers. And they´ve been popping up like mushrooms. China has been the principal target, with a slew of countries initiating anti-dumping actions against what they call “Chinese government-subsidised steel” being illegally dumped into their markets. In the Trump era, the legitimacy of such claims seems of secondary nature. The aim is to get the action underway, and worry about proving it later.

Which is not to say all such claims lack merit. It just seems quite a coincidence that so many have arisen so soon after Mr Trump lifted the tactic´s profile. The most recent to join the trend is the South African government which on May 1^st announced a steel import safeguard duty of 13% on hot rolled coil and plate. In mid-April, India had imposed a provisional 12% safeguard duty on alloy and non-alloy steel flat products for 200 days in an effort to curb cheaper imports. But by the end of April, the JSW Steel CEO, Jayant Acharya, had said it should be double that percentage! Acharya told S&P Global Commodity Insights that India’s relative disadvantage was “very clear” with steel tariffs from most of the world at 25% while India is at half of that amount. “The US has been having duties on India for the last 20 years, Europe has been for six years, so we need to look at what is good for India,” Acharya said.

Whether the measures are protectionism in its cynical form, or reasonable endeavours to preserve a resource, is open to debate. Irrespective, Australia is participating. During the election campaign, Anthony Albanese promised $1.2 billion towards a strategic critical minerals reserve in response to US reciprocal tariffs. Albanese said the Australian government would establish stockpiles of “certain key critical minerals produced under offtake agreements as required”. Australia is the world’s largest producer of lithium, bauxite and iron ore, and a top-five producer of cobalt, manganese ore, rare earths, rutile, tantalum and zircon. “To leverage our natural resources is in our national interest,” Mr Albanese said. “It will mean we can deal with trade and market disruptions from a position of strength because Australia will be able to call on an internationally significant quantity of resources in global demand”. Both the industry and the government have said they believe creating a critical minerals stockpile will provide confidence for Australia’s critical minerals sector to increase its investment while developing secure supply chains with key international partners. So, government subsidised. Or, would you call it, government incentivised?

Speaking of having a “protect or perish” dilemma, British Steel is giving the UK government quite a headache. In March this year, British Steel´s owner, Jingye Group, said the company´s principal steel manufacturing plant at Scunthorpe was losing £700,000 a day and was no longer financially viable. In April, the government assumed control of Scunthorpe and its 2700 employees. So, what to do? Prop it up, or watch it perish? The steel industry has played a key role in Britain’s industrial heritage, but the sector has faced a dramatic decline in more recent times. The UK has gone from being the fifth-largest steel producer globally in the late 1960s to 26th place, with just four million metric tonnes of crude steel produced in the country last year. Recent data from the World Steel Association ranked the UK ninth for steel production in the EU in 2023, behind leaders Germany and Italy. Currently, British steel plants are operating well below their installed capacity, contributing to the overall decline in the UK manufacturing sector, which has dropped to 12th in global rankings, its lowest since 2012.

Gareth Stace is the director general of the industry body, UK Steel. In a recent interview with Platts, part of S&P Global Commodity Insights, he attributed the decline in the local steel industry to a lack of investment and a failure to adapt to changing global markets. “China was seen as a great market for exports, but it quickly transitioned from being an importer to self-sufficiency and then into an exporter,” he said. Overproduction of steel by China has subsequently pushed down prices, exerting further pressure on mills in Europe, which face higher costs for raw materials, energy and labour. This dynamic has left UK producers struggling, with domestic production now meeting only 35% of demand.

As the UK government approaches the potential nationalisation of British Steel, Stace said he remains optimistic about the future of steelmaking in Britain; though he stressed a profitable and sustainable future would only evolve from a credible plan. The same advice could be given to the Australian government as it ponders how much money it might inject into saving the Whyalla Steelworks.