Going It Alone on Steel

Dear Reader,

Governments have spent years building their own steel policies, and they do not point in the same direction. More tools have not brought more alignment: distinct instruments in use rose from 27 in 2017 to 48 in 2025, across roughly 70 jurisdictions. Plurilateral coordination has not closed the gap: the Global Forum on Steel Excess Capacity set a June 2026 deadline to agree a joint framework, but it passed without one.

Governments are picking up new kinds of instruments, not just more of the familiar ones. The sharpest growth came from categories barely present before: investment instruments went from one or two types a year to six by 2025, and procurement and localisation instruments from one to four. Last week’s UK nationalisation of British Steel is an example of the growth of new instruments. This action follows the government taking administrative control of the company under the Steel Industry (Special Measures) Act 2025. 

Tariffs are hardening, but governments are not converging on the same mechanism. The United States modified its metal Section 232 regime in April, tiering tariffs from 10% to 50% by steel content. Canada imposed a 25% surtax on imported steel and aluminium goods "melted and poured" in China. This month, the EU's new inverse tariff-rate quota system replaced its 2018 safeguard, cutting quotas by 47%, doubling the out-of-quota duty to 50%, and adding another "melt and pour" requirement. The UK moved similarly but not inversely. It raised duties on certain steel products to 50% on 1 June, then introduced a liberalising tariff-rate quota on 25 June. Even here, the UK's framework covers 181 eight-digit tariff lines against the EU's 301.

Steel trade defence is intensifying among countries that were once minor users of it. Its traditional users, Australia, Canada, India, the EU, the UK and the United States, accounted for 77% of G20 steel trade defence investigations from 2017 to 2023; since 2024, their share has fallen to 63%. The rest, among them Brazil, Türkiye, South Korea, the Southern African Customs Union and Japan, have roughly doubled their combined annual caseload. Yet even as more countries act, their target converges: China was named in 54% of these investigations before 2023, and in 67% since 2024. 

Subsidy use has increased consistently as a share of all steel measures. Subsidy programmes stood at just 7% of all steel measures in 2017–2021, rose to 27% on average in 2022–2025, and reached 40% in the first half of 2026. China is the largest single source, at 13%. Its support is heavily provincial and usually embedded in larger programmes: Jiangxi Province recently unveiled a USD 294.4 million Chuangzhi Future Science and Technology Innovation Industry Guiding Fund, and Xiamen a USD 147 million Xiamen Guosheng Industrial Chain Innovation Fund. Other jurisdictions are joining. Türkiye, South Korea, Brazil and the United Arab Emirates have all unveiled public financial support reaching steel.

Governments are pursuing the same concern through their own separate agendas. What has emerged is not a framework but an accumulation: more instruments, held by a stable set of players, pointing in different directions. Without common terms, every measure is open to being matched, undercut, or ignored by the next.

Best regards,

Global Trade Alert

USTR's final Section 301 action on Brazil takes effect on 22 July. Our explainer estimates that the action lifts Brazil's trade-weighted US tariff from 11.7% to a four-day peak of 18.2%, settling at 14.4% once the Section 122 surcharge expires on 25 July. Of USD 39.6bn in 2024 imports, USD 8.5bn pays the full rate; exemptions led by crude oil and coffee cover USD 20.1bn.

• The Final Brazil Section 301 Tariff Takes Effect on 22 July with Wider Exemptions

• The Services Turn in Trade Securitisation

• How Denial Funds the Capacity it is Meant to Block

• Chokepoint: Tracking Trade Policy Responses to the Hormuz Crisis (Final update)

The chart places two NIPO series back to back over time. The upper area counts the restrictions the coalition has imposed on China; the lower area counts the subsidies China has put behind the same industries. Read together, the two move in step: each marked tightening of access is followed by a visible step up in Chinese state support. The chart does not prove that one causes the other, but it shows clearly that denial and subsidy have advanced on the same timeline.

UNCTAD: "World Investment Report 2026" (7 July 2026)

Funcas Europe (Future is Blue Podcast): "Can Europe turn industrial policy into real competitive capability?" (29 June 2026)

Financial Times: "The risks of borrowing from China’s economic playbook" (17 June 2026)

International Chamber of Commerce: "ICC Open Market Index 2026" (12 June 2026)

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