BRITISH STEEL
steel,” adds McDiarmid. “What happens is their economy slows down a little bit, then suddenly there are hundreds of millions of tonnes more than the whole capacity of Europe just flooding the market – that’s a major problem.” This already happens to a certain extent, he explains, and without protections in place it will make it harder for British steel to compete. The safeguards currently in place are due to expire in June 2026, which is a major concern, and trade wars and tariffs add further instability. “The steel sector is a cornerstone of our operations at STAHL CraneSystems UK,” says Rob Wood, sales and marketing manager at Columbus McKinnon Corporation, which acquired STAHL CraneSystems UK in 2017. “Our hoisting and crane technology is widely used in steel production facilities for handling raw materials, semi-finished products and heavy components. “Volatility in steel production can lead to fluctuating demand for our equipment and services,” he explains. “However, we mitigate this through agile supply chain management and close collaboration with our partners. Our modular product design also allows us to adapt quickly to changing requirements, ensuring continuity in service delivery even during periods of market disruption.”
Energy prices are another a major hurdle for the UK steel industry. “We have very uncompetitive energy prices in the UK – we pay about 50% more than they do in France and the Germany,” explains McDiarmid. This has been a huge issue for the UK in recent years, particularly in terms of attracting investment. Decarbonisation through DRI or EAF requires a lot more energy than currently used in blast furnaces to make steel. “When you’re trying to justify hundreds of millions of pounds worth of investment and we’ve got the highest energy price anywhere in the West, then that’s a really difficult justification for companies to make.” The UK lacks a competitive policy framework for steel, stresses McDiarmid. “We have a real chance of resetting the steel industry, which has been under invested for such a long time,” he says. Market protections and support for green investment are needed to regrow and rebuild the industry, but only if something is done about energy prices.
Clean as a whistle In response to the unfolding crisis, the UK government passed the Steel Industry (Special Measures) Act, aimed at stabilising the sector. The act allows for temporary nationalisation
of at-risk plants – such as Scunthorpe, the motivator for this act – emergency funding for decarbonisation projects and incentives for domestic steel procurement in public infrastructure projects.
While many in the industry have welcomed the move, some have argued that it’s a stopgap. “It was great to see the legislation go through with no dissent from any political party – there was a real consensus, everyone had a slightly different take on it, but everyone agree that it was important to intervene at that stage,” says McDiarmid He credits the situation to the shift to
global trends: “We’ve been making the case for many years that steel is a strategically important industry.” But, as a result of many of Trump’s policies, countries are looking after themselves. “This idea that we can’t let these industries go has a lot of political consensuses, so it was good to see that’s a real change in recent months. “It is a long overdue intervention, but I think it was an emergency intervention that had to happen.” The owners of Scunthorpe, Jingye, “were going to close things down, [and] they were starving the furnaces of raw materials.” This would have forced a closure and led to reliance on imports from the Chinese, which wasn’t an acceptable option for the government or industry. However, despite this, McDiarmid
believes this is only temporary. “It’s not been nationalised yet, but even if it is, we expect that it’s going to have to return to the private sector or at the very least have a major private investment coming in to partner with the government.” The next phase for Scunthorpe is decarbonising the site, an expensive process that is likely to cost billions and likely necessitating private investment. “That’s the really important next stage. It’s not a long-term solution but we believe it’s a necessary solution to finding a longer-term sustainable position,” adds McDiarmid. To achieve the next step of decarbonisation,
Decarbonisation has tended to reduce jobs in labour-intensive blast furnaces. 16 | June 2025 |
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however, is not without its own challenges. It’s not something that has done well in this country, admits McDiarmid. Decarbonisation tends to reduce jobs, especially in the labour- intensive blast furnaces. “Our most recent experience is the decarbonisation of Port Talbot,” explains McDiarmid. The initial plan was to avoid compulsory redundancies and transition over a decade, closing one blast furnace and building an EAF, and closing the other in the 2030s to be replaced with an EAF at that time. “That was not the approach which the government ultimately agreed with the company, which was ‘no, we’re just going to shut the furnaces
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