British steel and aluminium makers have been plunged into the trade tariff war launched by Donald Trump.

The US president imposed a 25% flat duty on steel and aluminium entering the US and ended all country exemptions to the levies that is likely escalate tensions with some of America’s largest trading partners.

Mr Trump hopes the tariffs will boost US steel and aluminium production but critics say it will raise prices for US consumers and dent economic growth.

The EU said it will impose counter-tariffs on €26bn (£21.9bn, $28.3bn) worth of American goods in response to US tariffs on all steel and aluminium imports.

This morning, William Bain, head of trade policy at the British Chambers of Commerce said:  “This is a difficult day for trans-Atlantic trade and plunges businesses, in both the US and UK, into a new age of uncertainty. 

“Products made with UK steel and aluminium play an important part in many supply chains in the US. Both sides will now be facing up to negotiations on how the burden of these new tariffs will affect businesses in both countries. 

“Tariffs mean prices and costs will inevitably go up and this is a lose-lose scenario for consumers, businesses, and economic growth. More tariffs are also on the agenda for the start of next month which will add fresh uncertainty into the mix.”

Mr Bain offered a glimmer of hope that the situation will be resolved quickly as higher costs are in no one’s interest.

“Today’s setback does not mean we have reached the end of the road in terms of negotiations. Tariffs can be lifted at any time,” he said.

“Businesses will be looking to the UK government to continue dialogue, with the US, to resolve this situation and restore certainty for firms, which has been badly lacking over recent weeks. 

“Against this background, a series of tit-for-tat tariffs could easily spiral into an all-out trade war and would do the UK little benefit.  We must keep talks alive and retaliatory tariffs should only be used as a means of last resort. 

“If talks succeed, it would be a win-win, bringing welcome stability and pro-growth economic conditions for both sides.” 

The European Commission said it will resume tariffs on US products on 1 April and will also put forward a new package of counter-measures on American goods by mid-April.

Ursula von der Leyen, the president of the European Commission, said in a statement: “We are ready to engage in meaningful dialogue. I have entrusted Trade Commissioner Maros Sefcovic to resume his talks to explore better solutions with the US.”

She added that the commission “deeply regrets this measure. Tariffs are taxes. They are bad for business, and even worse for consumers. These tariffs are disrupting supply chains. They bring uncertainty for the economy.

“The European Union must act to protect consumers and business. The counter-measures we take today are strong but proportionate.”