BRITISH STEEL
And the government view? Those were set out in
a strategy paper in March this year (when Keir Starmer was Prime Minister): “Domestic steelmaking provides skilled and high quality jobs, sustaining communities, and is necessary for our national resilience and security. Steel is needed for defence manufacturing, maintenance of our critical national infrastructure... Our vision is for a revitalised steel sector consisting of productive and profitable green steel producers that can provide a secure supply of steel to meet their customers’ needs, support our national security and provide high quality, secure and long term jobs. Our initial aim is to stabilise the sector, ensure its viability, and return domestic production to recently sustained levels of around 40-50% of domestic steel demand, compared with 30% in 2024.” We have also, as you may have noticed, a new Prime Minister. Andy Burnham has a lot on his plate at present; but he has explained his philosophy as ‘Manchesterism’. Part of it is re-industrialisation to give modern productive capacity to revive once- prosperous manufacturing towns and the people who live there. His staff have reported that any policy change has to pass the so-called ‘Makerfield Test’, Makerfield being the deprived Manchester suburb that is his parliamentary constituency: ‘Will any move benefit those like the ordinary people of Makerfield who have been left behind by the de-industrialisation of the past forty years?’ Add investment in “regional productive capacity as a route to social stability and national renewal.” On that basis current government commitment to a revived UK steel industry - and it is to be hoped a transformed one – would seem assured.
Port Talbot have committed to a new EAF to transition to greener steelmaking.
Steel commitment So, given that we need to continue to make steel in the UK, how do we achieve it? As we have said, Tata have closed the last blast furnace at Port Talbot; they did so in September 2024. In it place they have committed to
building a new electric arc furnace, at the plant. The contract was signed that same month. The government committed £500m to it; Tata invested a reported £700m. The reported aims were to secure the future of the plant and to transition to greener steelmaking. The EAF project broke ground in July 2025 and commissioning was expected in 2027. That has been delayed. “That is because of National Grid problems in supplying the huge quantities of electricity that EAFs demand,” says McDiarmid. It would have seemed sensible to keep the Port Talbot blast furnace running until the new EAF was ready, thus giving continuity of steel production and of jobs. That did not happen. In the meantime all that is happening at Port Talbot is processing imported steel slabs to produce rolled steel products, with no new steel being produced at all. What, then, of British Steel at Scunthorpe? Given its appalling carbon footprint, should the government continue to operate its blast furnace or could a future of solely Electric Arc Furnaces suffice our needs? “We certainly think that we need to retain our ability
to make steel out of raw materials,” says McDiarmid, “because if we don’t, then we are heavily dependent on those that do. We can and we should keep our blast furnaces going at least in the medium term. “And the evidence is that that is what everyone else is doing. If you look across Europe, the French and the Germans are keeping their blast furnaces going into the 2030s and some into the 2040s. So, there is no reason why we have to be a first mover and get rid of our blast furnaces before anyone else.” Having said that, more is involved that just keeping the Scunthorpe furnace supplied with coke. “We do have some challenges, in the age and condition of some of our assets. Huge investments have to be made if we are going to continue with blast furnaces. One of the ones at Port Talbot was very much at the end of its life. It would have been an enormous cost to essentially rebuild those furnaces, and it was a natural time to change something
34 | September 2026 |
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