UK Buying Chinese Steel Also Made in Britain, MPs Told

Key Takeaways

• MOD's Defence Infrastructure Organisation buying Chinese steel despite UK supply
• Tariff on steel imports starts 1 July, could raise defence procurement costs
• UK tariff‑free quota for specialist steel (1,000 t) far below market demand (4,000 t)
• Make UK urges practical tariff solution, not outright delay
• Spot‑buying from China deemed unacceptable by domestic steel advocates

Pulse Analysis

The Ministry of Defence’s reliance on imported steel has long been a point of tension between Whitehall and the domestic manufacturing lobby. Defence infrastructure projects require large volumes of structural and specialty steel, yet the Defence Infrastructure Organisation continues to source standard grades from Chinese suppliers despite comparable products being available from UK mills. This practice not only raises questions about procurement oversight but also signals a missed opportunity to bolster the British steel sector, which employs thousands and contributes to the nation’s strategic autonomy.

A 50 percent tariff on selected steel imports is slated to take effect on 1 July, aiming to protect domestic producers from what officials deem unfair competition. However, the tariff’s design includes a modest tariff‑free allowance—1,000 tonnes for a specialist grade that Barrett Steel alone purchases around 4,000 tonnes annually for defence contracts. The disparity suggests that the quota will be quickly exhausted, forcing manufacturers to absorb higher costs or seek alternative sources. For the MOD, this could translate into increased budgets for platforms ranging from naval vessels to armored vehicles, potentially straining an already tight defence spending framework.

Beyond immediate cost implications, the episode underscores a broader policy dilemma: balancing open market principles with the need for a resilient, home‑grown defence industrial base. Industry groups like Make UK are urging the government to negotiate practical exemptions or phased implementations rather than a blunt tariff that could disrupt supply chains. As the UK pursues its "Made in Britain" agenda, aligning procurement practices with industrial strategy will be crucial for maintaining both fiscal prudence and national security.