Sheffield’s steel industry could be a key bargaining tool in the battle to stop the US imposing tariffs on UK imports.

The new US president Donald Trump has announced plans to impose tariffs on imports of UK steel.

Business Secretary Jonathan Reynolds today warned that doing so would be ‘negative’ for both sides of the Atlantic.

Business Secretary Jonathan Reynolds told the BBC's
Sunday With Laura Kuenssberg that proposed tariffs on UK steel imports could end up costing US taxpayers more as some of the things the US imports it doesn't have alternative suppliers for, like the submarine casings made in Sheffield for the US Navy. Photo: Simon Hulme, National World/BBC — Business Secretary Jonathan Reynolds told the BBC's Sunday With Laura Kuenssberg that proposed tariffs on UK steel imports could end up costing US taxpayers more as some of the things the US imports it doesn't have alternative suppliers for, like the submarine casings made in Sheffield for the US Navy. Photo: Simon Hulme, National World/BBC | Simon Hulme, National World/BBC

placeholder image — Business Secretary Jonathan Reynolds told the BBC's Sunday With Laura Kuenssberg that proposed tariffs on UK steel imports could end up costing US taxpayers more as some of the things the US imports it doesn't have alternative suppliers for, like the submarine casings made in Sheffield for the US Navy. Photo: Simon Hulme, National World/BBC | Simon Hulme, National World/BBC

Speaking on BBC’s Sunday with Laura Kuenssberg he said that specialised steel made in Sheffield was used by the US Navy on its submarines, and a proposed 25 per cent tariff on imports would end up costing US taxpayers more.

“In relation to steel and aluminium, what we send to the US is very specialised, relatively niche products that the US needs,” said Mr Reynolds.

He added: “Some of the things the US imports, it hasn’t got alternative suppliers for. The submarine casings that come from Sheffield, for instance, to the US Navy.

“I don’t want them paying more needlessly for that, so we can engage, and we’ve already been doing that.”

Asked what the impact of the tariffs due to come into force in March would be, he said: “It would be negative for ourselves, it would be negative for the US as well.”

In 2016, Sheffield Forgemasters, based on Brightside Lane, secured a £23 million order to make castings for US nuclear submarines.

Forgemasters’ bosses described the deal at the time as a testament to the skills of its workforce.

Speaking on the BBC, Mr Reynolds said there was the ‘basis for constructive engagement’ between the UK and US on tariffs.

“I appreciate they have a mandate for changing how they approach the issues of trade, but we have got a different argument, a different story to tell, to the EU or to China in relation to our trading relationships,” he added.

Mr Trump has also threatened to impose tariffs in retaliation for charging VAT on US goods.

But Mr Reynolds said: “I would not say that VAT is a tariff. It is a sales tax, similar to the sales tax that they have in the United States.

“So we’re having these conversations, we’re engaging on it. I think sometimes in some of this, you’ve got to stay calm, you’ve got to be pragmatic, you’ve got to engage.

“It is not in our interests or that of the United States to be in a position where we’re charging tariffs on each other’s goods.”