A King's Award-winning British steel fabricator has warned the Government's flagship steel protection policy contains a critical flaw which will drive manufacturing overseas.
Fabweld Steel Products (FSP) says while the UK will impose significant import tariffs on raw steel, the policy has failed to do the same for fabricated steel goods. From July, the Government is cutting tariff-free steel import quotas by approximately 60% and imposing a further 25% tariff on imported steel.
FSP supplies specialist drainage and access covers to the UK's water, energy, telecoms and infrastructure sectors, including national projects such as the London Power Tunnels.
Richard Hilton, chairman of Fabweld Steel Products, said: "The intention of this policy is to protect UK steel and domestic manufacturing. The practical effect, if left unchanged, will be the opposite. UK fabricators will face higher costs that overseas competitors simply don't face.
"The rational response for any business is to manufacture abroad and import the finished product — and that is exactly what this policy will incentivise." He continued: "For companies like ours — buying British steel, employing skilled workers, investing in decarbonisation — this makes UK fabrication structurally uncompetitive at exactly the moment the Government says it wants to rebuild domestic manufacturing capability."
FSP, which won a King's Award for Enterprise for Sustainability in 2025, also highlights the additional burden of Carbon Border Adjustment Mechanism (CBAM) compliance for smaller exporters.
As an exporter to EU member states, FSP faces obligations to declare the carbon emissions of exported goods and, where UK steel emissions exceed EU benchmarks, absorb the resulting carbon tax, a significant and growing pressure on an SME with finite resources.
The company is calling on the Government to extend tariff measures to cover imported fabricated steel goods and provide proportionate support for SME manufacturers navigating CBAM obligations.
Mr Hilton added: "We are not asking the Government to abandon its commitment to UK steel. We are asking for policy coherence. The tariff framework must cover finished goods as well as raw materials — otherwise it does not protect British manufacturing, it undermines it."
FSP has written to Telford MP Shaun Davies as well as Ministers at the Department for Business and Trade, urging the Government to address the anomaly before the July deadline.