The output of steel in the UK last year was 11.9m tonnes – 19 per cent below pre-recession levels, figures from industry body EEF reveal today. UK Steel, a division of EEF, blames the industry’s struggle on slow growth in China – a major steel importer – and a strong pound – which makes foreign goods cheaper relative to domestic ones.
“As a result we are now seeing a growth in steel imports being dumped both here and in other EU countries,” said Ian Rodgers, director of UK Steel. “This underlines the need for the European Commission to act.”
However, critics of intervention voiced their disagreement. “Like a drop in the oil price, it [a low steel price] can hurt some industries, but, like a drop in the oil price, it is an overall benefit to society,” Ben Southwood, head of research at the Adam Smith Institute, told City A.M.
Alastair Winter, chief economist at investment bank Daniel Stewart, warned other industries may follow suit. “Nearly everyone is trying to restrain if not devalue their currency,” he told City A.M.
Winter added that any kind of import tariff on steel would be a “slippery slope”.