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Sir Keir Starmer will not impose immediate counter tariffs against Washington if Donald Trump hits Britain on Wednesday with his 25 per cent global levy on steel and aluminium imports to the US.
Downing Street said the UK premier would take a “cool headed” approach as he tries to keep Britain out of any wider transatlantic trade war. “You won’t get immediate counter tariffs,” said one UK official.
Starmer urged the US president on Monday in a phone call not to target British steel and aluminium makers, but is braced for the first Trump tariffs to be imposed on the UK in the early hours of Wednesday.
The prime minister has pinned his hopes on Trump exempting the UK from wider tariffs as part of a possible US-UK economic deal — initially focused on technology — discussed by the two leaders in the White House last month.
The US accounted for about 182,000 tonnes of Britain’s steel exports in 2024 — about 7 per cent of total exports but 9 per cent by value and worth more than £400mn.
Allies of Jonathan Reynolds, business and trade secretary, said the minister will stress the government support already being given to the UK steel industry as he attempts to avoid inflaming trade relations with Washington.
Reynolds’ colleagues say the minister could issue some kind of response if the US steel tariffs are applied, but it will not include an immediate wave of counter-tariffs of the kind seen during Trump’s first term in office. Officials declined to say what it might include.
In 2018 Britain, which was then part of the EU, levied tariffs on iconic US products such as motorcycles, whiskey and jeans after Trump imposed tariffs of 25 per cent on steel and 10 per cent on aluminium from most countries.
Those tariffs were suspended in March 2022 under a deal with the Biden administration and replaced by a tariff-rate quota system, allowing 500,000 tonnes of UK steel to enter the US annually without incurring duties.
Reynolds told the Financial Times in Tokyo last week that he would “stand up” for the British steel industry and that retaliatory measures “already exist”, as he tried to exert pressure on the US administration not to hit the UK with steel tariffs.
But the UK position has softened as officials in Whitehall took the view that Trump was determined to press ahead. Ministers have reserved the right to reactivate the suspended tariffs.
British officials stressed that only 5 per cent of steel production by volume goes to the US, much of it highly specialised. For example, steel made in Sheffield is used by the US Navy for submarine casings.
Reynolds, who is expected to give a statement to MPs on Wednesday if the US tariffs are imposed, will also note that the government has committed up to £2.5bn to rebuild the steel sector, British officials said.
He will point to a new scheme capping energy costs for industries such as steel that comes into force next month, which would cut the electricity costs of energy intensive sectors such as steel by between £320mn and £410mn this year.
British steel exports have fallen in recent years amid a wider industry decline but the US is the UK’s second-largest export market after the EU.
Britain’s steel industry has warned that the US tariffs could deal a “devastating blow” to the sector at a time of shrinking demand and high costs.
Chrysa Glystra, director for trade and economic policy at UK Steel, the trade lobby group, said on Tuesday that it was “disappointing” that the UK government had so far not secured any exemptions to the incoming tariffs although the industry was mindful of the effort made by ministers.
Some UK producers, said Glystra, were already seeing their “commercial position in the US being challenged”, with anecdotal reports that US customers had paused additional orders given the uncertainty over the tariff situation.
Nadine Bloxsome, chief executive of the Aluminium Federation, said UK producers were already reporting “early signs of business uncertainty”.
The concern, she said, was not just about “immediate loss of contracts but the longer-term risk of trade diversion, where materials originally destined for the US are redirected into alternative markets, including the UK”.
The US accounted for about 10 per cent of exports of aluminium by volume last year, worth around £225mn.
