MercoPress. South Atlantic News Agency

UK’s Labour government to the rescue of the steel industry

Tata Steel to install new electric arc furnace technology at its Wales Port Talbot works.

The United Kingdom government has formed the Steel Council to advise and implement a new steel strategy, to help revitalize the steel industry and has pledged financial support of steelmakers Tata Steel and British Steel.

The companies are expected to modernize technology and increase efficiency including the installation of electric arc furnaces, but despite the government initiative not everyone is pleased or convinced about the effectiveness of a Steel Council and furthermore the long term prospects of a steel sector in the current wave of Tec modernization.

The UK government’s Department for Business and Trade said that the “The Council will bring together steel sector leaders such as CEOs from Tata Steel and British Steel with trade union leaders, industry experts, devolved government representatives and trade associations to address the challenges facing the steel industry and make the changes needed to secure a steelmaking strategy in the UK” C

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Representatives added that the department “will meet regularly as the government prepares to launch its steel strategy, providing a vital link between industry, workers, experts and government in every part of the UK and ensuring that both the workforce and economic growth are at the heart of its plans to rebuild the steel sector.”

The Community union, which is associated with steelmakers in the UK, also expressed its support for the strategy. However, one industry watcher played down the event, stating that it sounded as if “they just agreed to agree.”

In July, UK’s Labour government announced that it had earmarked an additional £2.5 billion (US$ 3.1 billion) for the steel sector, in addition to the £500 million it pledged to help Tata Steel to install new electric arc furnace technology at its Port Talbot works.

Longs producer British Steel also aims to replace the four blast furnaces at its Scunthorpe site wth electric arc furnace technology. The site is located in North Lincolnshire, and has been a cornerstone of the UK’s steel industry since the mid-19th century.

In 2024, British Steel’s parent company, Beijing-headquartered Jingye Steel, held talks with the UK government over the amount of aid the steel plant would receive towards the project, which carries a tentative price tag of £1.3 billion (US$ 1.62 billion).