The UK government is considering nationalizing British Steel if its efforts to rescue the second largest UK steelmaker fail in the coming months, all the main UK-based newspapers reported on Dec. 4. According to all the national newspapers ministers are talking to renationalizing steel producers as last resort to rescue jobs and the national crude steel production amid a standoff between the government and British Steel's Chinese owners over the £1bn investment needed to transition toward low carbon steel production.
But when contacted by S&P Global Commodity Insights on Dec. 4, a UK Government's Department for Business and Trade, official spokesperson said that the government has "no plans to nationalize British Steel." "We're working across government in partnership with trade unions and businesses to secure a green steel transition that's right for the workforce, represents a good investment for taxpayers and safeguards the future of the steel industry in Britain," the DBT spokesperson added.
A British Steel spokesperson said to S&P Global Commodity Insights when contacted on De 4: "We are in ongoing discussions with the government about our decarbonization plans and the future operations of our UK business. While progress continues, no final decisions have been made."
British Steel's plant at its site in Scunthorpe is the only steelmaker left in the UK that still makes crude steel after Tata Steel closed all its blast furnaces at Port Talbot in South Wales securing Eur500 million in funds for its low-carbon transitions to build its Electric Arc Furnace.
British Steel was nationalized in 2019 while the government was looking for buyers. It was then sold to the Chinese steelmaker, The Jingye Group, which pledged a GBP1.25 billion ($1.55 billion) decarbonization plan.
Under the proposed plan, the company proposed to install two EAFs -- one at its headquarters in Scunthorpe and the other at its manufacturing site in Teesside. However, now there are rumors that the company could consider only an EAF in Scunthorpe and not in Teesside. The company did not answer when asked about this specific.
The company has been trying to work with the government for months for some funds to make operative the relaunch of the site and start the transition from a Blast Furanes production to an Electric Arc Furnace production with the first EAF that was supposed to become operational by late 2025, replacing the 3 million mt/year blast furnaces responsible for the vast majority of the company's CO2 emissions. A timeline that seems now impossible to reach not only due to the lack of funds but also due to the lack of power grid connections.
Platts assessed on Nov. 28 UK HRC weekly at GBP530/mt basis DDP West Midlands, up GBP5 on the week, but down GBP110/mt since the beginning of the year.
Platts is part of S&P Global Commodity Insights.
