A climate of fear and uncertainty is descending upon European industry as the United States wields the power to “ad hoc” expand its list of goods subject to steel tariffs. The core of the anxiety is the “derivative” products list, which targets items containing metal, with fears that everything from construction materials to household goods could be arbitrarily added at any time.
The issue began with tariffs on raw steel, but has since spiraled. A list of 407 derivative product categories is already in place, roping in a diverse range of goods like rail cars, furniture, and industrial cranes. The EU steel industry now warns that a new US consultation, ending September 29, is clearly designed to lengthen this list even further.
This unpredictable approach is wreaking havoc on business planning. According to Luisa Santos of BusinessEurope, the ability of the US to continuously add to the tariff buckets makes the transatlantic trade relationship turbulent and unstable. “It could be a motorbike that is now hit, or a table with a small bit of metal on it,” she warned.
The on-the-ground reality for manufacturers is a bureaucratic and financial nightmare. As described by German MEP Bernd Lange, companies are struggling to track every single metal component in their products. To avoid catastrophic fines for non-compliance, some are resorting to over-declaring their steel content and paying more in duties than necessary.
This ad hoc policy is seen as a direct threat to the health of European manufacturing. In response, industry bodies are demanding new protective trade measures from the EU. The UK government is also pressing Washington for clarity, as businesses across the continent struggle to navigate a trade environment defined by ambiguity and risk.