The Confederation of British Metalforming says quota cuts and tariffs are devastating downstream producers
The government’s steel policy is beginning to devastate the downstream manufacturing sector, according to the Confederation of British Metalforming (CBM), which represents 200 member businesses and more than 75,000 employees.
CBM President Stephen Morley argues that misguided quota reductions, compounded by the imposition of tariffs, have left metal stockists and manufacturers facing shrinking margins, commercial uncertainty and the prospect of job losses across the supply chain.
Evidence submitted to ministers by the CBM points to a systemic breakdown in domestic supply, with UK suppliers unable to meet demand due to excessive minimum batch quantities and unreliable delivery timelines.
In one case highlighted by Morley, a business requiring 30 tonnes was told it would need to take a minimum run of 120 tonnes, potentially leaving it holding £80,000 of surplus stock.
Offshoring fears and a ‘deeply unbalanced system’
Category 1 hot-rolled coil quotas have been cut by approximately 90 per cent, from around one million tonnes to just 100,000 tonnes. Meanwhile, certain specifications not produced domestically at all are subject to tariffs of 50 per cent once quotas are exhausted.
Richard Jewitt, Managing Director of Footprint Sheffield Ltd, one of the UK’s last remaining hand tool forges, said: “We are now actively reviewing our options, which include scaling back UK production and importing finished goods, increasing prices while reducing the workforce, or winding down production.”
There are already signs of offshoring, with one large UK steel user confirming it has shifted a quarter of its component sourcing to the Far East.
Morely added: “Downstream sectors employ significantly more people than primary steel production, yet they are bearing the brunt of these measures.
“The CBM is calling for an urgent full review of quota reductions and tariff structures, and exemptions for materials not produced in the UK.”
