British Steel to cut up to 260 jobs as it closes Scunthorpe coke ovens with 'devastating' announcement

The company said its bills for energy and carbon increased by £190 million last year, adding that “decisive action” was required because of the “unprecedented rise” in operating costs, surging inflation and the need to improve environmental performance.

British Steel chief executive Xifeng Han said: “Steel is vital to modern economies and with demand expected to grow over the coming decades, British Steel has a crucial role to play in ensuring the UK has its own supply of high-quality steel.

“To make sure we can deliver the steel Britain requires, we’re undergoing the biggest transformation in our 130-year history.

“To support the journey to net zero, our owners, Jingye, have invested £330 million in capital projects during their first three years of ownership and they continue to invest unprecedented sums of money in British Steel.

“Jingye is committed to our long-term future but decarbonisation is a major challenge for our business and, like most companies, we’re facing significant challenges because of the economic slowdown, rising inflation and exceptionally high energy prices.

“For example, last year our energy bill rose by £120 million while we’ve also faced an increase of over £70 million in our annual carbon costs.

“We have taken action to reduce costs within our control; however, steelmaking in the UK remains uncompetitive when compared to other international steelmakers.”

“Our energy costs, carbon costs and labour costs are some of the highest across the world, which are factors that we cannot influence directly.

“For the reasons outlined, we entered into talks with the UK Government in summer 2022 and are extremely grateful for its support.

“It’s important we have the correct policies and frameworks in place to back our drive to become a clean, green and successful company and we’re continuing to discuss this with the Government.

“We are committed to working together and to making the home-made steel Britain needs for generations to come.

“To build a secure future for British Steel, and protect skilled and well-paid careers for thousands of employees and many more in our supply chain, we are – like many other businesses – proposing to streamline our business.

“We’re disappointed at having to make such proposals but are confident they will support a successful transformation.”

Speaking before the official annoucnement, Charlotte Brumpton-Childs, GMB national officer, said it would be “devastating news“ for the people of Scunthorpe and all British Steel workers across the UK.

She said: “With grim predictability, the Government’s investment is a sticking plaster that does nothing to help the long-term structural issues affecting our steel industry.

“Now steel workers, their families and communities will once again be asked to pay the price.

“GMB urges British Steel and the UK Government to continue talks.

“Ministers need to decide if they want the UK to have a future in steel or whether they want it to wither and die like so much of our proud manufacturing heritage.”