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British officials are rushing to ensure access to coal and iron ore supplies to ensure that the UK’s last two explosion furnaces continue to operate after the emergency law is passed to maintain UK steel.
British officials have been at the company’s Scunthorpe site since Saturday and will work closely with British Steel’s local management to continue production by securing new cargoes of coke and iron ore.
The government is racing to prevent the explosion from cooling. It’s not impossible to turn them on again, but it’s a costly and a long process.
The coal shipment needed to fire the furnace was docked to the port of Imingham in Lincolnshire on Sunday, but it was not paid by the Chinese owner of British Steel, Jinzi Group.
Closes two furnaces on Scunthorpe’s British Steel, leaving the UK as the only G20 country that cannot make iron from scratch.
Ir Kiel took the extraordinary step of recalling Parliament on Saturday during Easter breaks, allowing Britain to take control of Ginsey’s operations at British Steel.
The new law gives the government the authority to control the plant and to control workers to ensure production continues.
Jingye remains a major shareholder for now, but the law is an important step on the path to nationalisation of British steel.
“My team is already working on the ground to keep the furnace burning,” Jonathan Reynolds’ business secretary said Monday. “We will develop a long-term plan for co-investment with the private sector to ensure UK steel has a bright and sustainable future.”
Reynolds said over the weekend that his preferred option would be to find private sector partners to help fund the UK steel transformation, but the more likely option would be full nationalization.
He said shareholders will be paid a fair market fee in the event of nationalization, but added, “In this case, the market value is virtually zero.”
One official said there were other shipments of raw materials during its shipment to the UK and the government was working to ensure they infiltrate and arrive at the Scunthorpe factory.
British Steel was also reassessing whether Jingye executives could reverse the decision that temporarily idle one of the furnaces.
Local management of steel manufacturers was considering working with players in other industry to protect the raw materials.
Over the past 24 hours, more than 12 companies have provided support to the company, including Tata and Rainham Steel.
The minister intervened to preserve primary steelmaking in the UK and protect 3,500 jobs in the sector.
Reynolds on Sunday was unable to ensure that the government could ensure enough raw materials to burn the furnace.
He said that Jingye’s “conscious decision” to sell existing supplies of raw materials is a major change that the government needs to intervene.
Reynolds acknowledged the steel industry’s sensitivity to strategic national interests, saying, “I personally wouldn’t bring Chinese companies into the steel sector.”
Asked if there is a “high trust bar” in Chinese companies that control British companies, he said: “Yes, we have to recognize that.”
Reynolds told Sky News that whether the government can trust Chinese companies after Jingie’s handling of British steel will depend on the sector they run.
He said: “We really are like a sector where we can promote and collaborate, and I think we have to be clear about where we can’t be frank.”
Government intervention led to a new scrutiny of the former Conservative government’s decision to sell the UK’s last strategic steel group to Chinese companies in 2020.
Reform UK leader Nigel Farage said Jinsie was clearly a “bad actor” and criticised the BBC on Sunday for “they effectively gave strategic industries to foreign enemies.”
Jingye did not immediately respond to requests for comment.
