British Steel has announced that steelmaking in Scunthorpe is heading for closure as operations are “no longer financially sustainable”. The UK government has said it would consider nationalisation if necessary but a “commercial solution” was still possible.
Founded in 2016 from the ashes of Tata Steel, British Steel has had a challenging decade because of reduced demand for the metal and tough competition from Chinese manufacturers.
In 2020, Chinese firm Jingye Group acquired British Steel with a commitment to invest £1.2bn over 10 years to modernise its sites and boost energy efficiency.
Jingye had plans for a number of initiatives, including developing the electric arc furnace in Teesside, constructing a new 250MW power plant to serve the Scunthorpe site, and investing in rolling mills to produce high-quality steel products.
However, over the past five years, despite having already invested more than £300m at the Scunthorpe site, the Chinese-owned company revealed that losses have spiralled...