Government intervention keeps British steel furnaces running, amid growing tensions over Chinese ownership

In a crucial move to prevent the closure of the UK’s last primary steel plant, the government has secured vital raw materials for British Steel’s Scunthorpe site. The first shipments, which included coking coal and iron ore from the US, arrived, with a third vessel expected from Australia. These supplies will keep the plant’s blast furnaces operational for several weeks, providing a temporary lifeline after talks with Chinese owner Jingye collapsed.

Business Secretary Jonathan Reynolds expressed his satisfaction at the successful arrival of the materials, calling it a “good use of taxpayers’ money” to support British Steel and its employees. This intervention comes after Jingye stopped ordering materials and began selling off existing supplies, threatening the closure of the facility and risking thousands of jobs.

Steelworkers’ unions have praised the government’s actions, with one representative calling the delivery of raw materials a “huge relief.” British Steel has also described the move as offering “great hope” for the future of the plant. However, the crisis is far from over, with the government now tasked with securing a stable future for the steelworks and its workers.

The Scunthorpe plant is vital for producing steel for key industries, including construction and automotive, as well as supplying steel rails to Network Rail. Without continued operation, the UK would face increased reliance on steel imports, which could drive up costs due to Donald Trump’s 24% tariff on U.S. steel imports.

The government has enacted emergency legislation to take control of British Steel, securing the necessary materials and protecting jobs. However, the situation remains delicate. Deputy Prime Minister Angela Rayner and other government officials are now focusing on the ownership issue, with the UK considering alternative routes for securing long-term stability.

Tensions have escalated over Chinese involvement in the steel plant’s future. Beijing has accused the UK of politicising trade relations, while critics within the UK argue that the country’s national security is at risk if Chinese firms maintain ownership of key industries like steel. The Liberal Democrats and other critics have called for an end to Chinese ownership and a full audit of China’s involvement in British business.

The situation at British Steel highlights the ongoing debate over foreign investment in critical infrastructure and its implications for the UK’s economic and national security.