Instead, the government is seeking to agree on a permanent guarantee of 25% tariffs

The UK has suspended talks with the US on reducing tariffs on steel and aluminum ahead of Donald Trump’s state visit to the country. This was reported by The Guardian.

According to government officials, ministers were ready to finalize an agreement this week that would reduce US tariffs on British steel to zero, but the process was frozen a few hours before the US president’s arrival in the country.

One government source said the deal would have provided zero tariffs for steel exports only within a small quota. Instead, officials are seeking to agree on a permanent guarantee that US tariffs will not exceed 25% (other countries face tariffs of 50%).

Another insider said that under the postponed agreement, the steel export quota would increase as US concerns about sources of raw material imports to the UK were addressed.

Meanwhile, British Prime Minister Keir Starmer is set to unveil a technology deal with the US worth around £31 billion and has announced the creation of an artificial intelligence “growth zone” in the north-east of England.

The trade agreement announced by the US and the UK in May this year was supposed to reduce tariffs on British steel from 25% to 0%, but its implementation was suspended due to US concerns that it would become a loophole for importing cheap steel from other countries.

The decision to suspend negotiations was made even after Trump made it clear that he was open to some trade concessions from Britain to facilitate the implementation of the agreement between the parties. The government insists that negotiations on reducing steel tariffs to zero are continuing.

Representatives of the steel industry expressed disappointment at the news but hope for some certainty.

UK Steel CEO Gareth Stace said it would be disappointing if British steelmakers did not have duty-free quotas, but the final decision on 25% offers some certainty and a potential competitive advantage while other countries remain at 50%.

As Bloomberg points out, the disagreement stems from the US insistence that steel must be “melted and poured” in the UK to qualify for tariff exemptions. However, this requirement cannot be met by Tata Steel UK, one of the country’s largest steel producers, which closed its last blast furnace last year.

From August 1, 2025, British steelmakers will once again have duty-free access to the EU market for key steel products as part of the reset of relations. They will be able to export 27,000 tons of category 17 metal products, including angles and steel profiles, to the EU on a quarterly basis without paying additional duties. The European Commission’s decision reinstated the UK’s country-specific quota (CSQ) in this category.