Steven Croft: Forging a future for steel industry before it is too late

The heat and drama of steel casting at Sheffield Forgemasters. The steel industry has suffered major blows this year as it struggles to compete with the rest of the world.
The heat and drama of steel casting at Sheffield Forgemasters. The steel industry has suffered major blows this year as it struggles to compete with the rest of the world.
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I MADE a visit to Tata Specialist Steels in Stocksbridge last month. I met with the senior management team for an overview of the business and then I was taken on a tour of the plant and the steel rolling mill.

It’s only my second tour of a major steel works and, once again, it was an unforgettable experience. The steel arrives as huge cylinders, newly smelted from scrap metal in the firm’s Rotherham plant, twice as tall as a man and more than twice as wide.

We walked through and over the length of the steel rolling mill. The cylinders of steel are first heated to high temperature in furnaces, then lifted out by huge cranes and transferred one at a time to the rolling presses.

Enormous force squeezes them into new shapes, like a child working an enormous piece of plasticine. Each time the metal goes through the press it becomes longer and thinner, up to 60 or 80 metres depending on the order. The ends are trimmed to the right length and the new piece of steel is then transferred to the cooling racks.

At a later stage these huge pieces of steel will form the raw material for aeroplane parts, car engines, oil and gas drilling equipment, and high end stainless steel instruments.

The pressing was controlled from a hi-tech area called a pulpit. Imagine my delight at the name. It’s a hi-tech control tower, high above the steel, where about 10 men pass the molten steel from one machine to another with immense skill.

The prophets of the Old Testament spent time in the forges of their day, watching the furnaces and the hammering of metal. The process of forging iron was a source of wonder then as now. It became an image of God’s power and also of purity and holiness.

“Is not my word like fire,” says the Lord, “and like a hammer that breaks a rock in pieces” (Jeremiah 23.29).

“For God is like a refiner’s fire and fuller’s soap” (Malachi 3.2).

Sheffield and Rotherham are known all over the world for the manufacture of steel.

Steel is a vital part of the economy and the history of the region and has shaped who we are.

I learned afresh during the visit that the steel industry faces huge challenges.

The week before I went to Stocksbridge, SSI UK announced the closure of the steelworks in Redcar with the loss of 1,700 jobs.

Tata Steel has announced major redundancies at its works in Scunthorpe. These closures and job losses carry terrible consequences for individuals and communities.

I was impressed by everything I saw in my visit to the Stocksbridge plant. The management have energy and vision. The apprenticeship programme is exemplary. The product is superb. The workforce is committed and skilled. There has been extensive investment for the future.

But the steel industry faces global challenges. The demand for steel in China has dropped so cheaper Chinese imports are flooding the market in Europe. Energy costs for manufacturers in Britain are significantly higher than in Germany.

This is a very critical time for the British steel industry.

A few weeks after my visit, I took part in a major debate in the House of Lords on our energy strategy for the future. The focus was on electricity generation. The country faces three key questions. How do we generate enough energy for our needs (including the needs of industry)?

How do we make sure that energy is at a competitive price for industrial and for domestic consumers?

How do we make sure that we reduce the carbon emissions in power generation?

This is the great energy trilemma.

The debate concluded that the country needs a much better long term plan.

In the debate, I raised with the Government the need to do something very rapidly now to level the playing field in terms of energy costs for the UK steel industry.

Conversations with the senior team in Stocksbridge focussed around future energy pricing and supply. The British steel industry pays much, much more for its energy than its competitors in Germany and the rest of Europe.

The playing field is not level. According to Luis Sanz, managing director of Celsa, quoted in the Financial Times on October 27, his company faces electricity bills of 68 euros per megawatt hour to run its steel plant in Cardiff. A similar operation in Germany would cost about 24 euros per megawatt hour.

The Government has promised a full package of measures for energy intensive industry but only once it receives clearance from the EU on state aid rules.

I do not believe we can wait any longer to bring this vital help to our steel industry.

We have already seen the closure of plants in Redcar and Scunthorpe with consequent damage to communities and to Britain’s industrial base. Along with many others, I would urge the Government to act and bring forward this support in the Chancellor’s Autumn Statement.

The steel industry is an immense part of our heritage and our economy in this region. The whole of Yorkshire need to understand what is happening, support those involved and help their voices to be heard.

n The Right Reverend Steven Croft is the Bishop of Sheffield.