Emergency action taken to secure Scunthorpe site and safeguard the future of virgin steel production
In a dramatic move to preserve the UK’s ability to produce virgin steel, the government has intervened to take temporary control of British Steel’s Scunthorpe plant, following threats of closure by its Chinese owner, Jingye Group.
The intervention, made possible through emergency legislation rushed through Parliament on Saturday, aims to prevent the imminent shutdown of the country’s last two operational blast furnaces. If those furnaces were turned off, the UK would lose its domestic capacity to manufacture virgin steel—a critical material for large-scale infrastructure, transport, and defence projects.
Furnace Lifeline: Government Scrambles for Coal Supply
Business Secretary Jonathan Reynolds acknowledged that the situation remains “difficult and challenging,” as the government races against time to secure the necessary raw materials, especially coal, to keep the blast furnaces operational. However, when pressed repeatedly on whether coal supplies could be guaranteed, Reynolds declined to confirm, citing commercial sensitivities.
“What we have done is buy ourselves the opportunity,” Reynolds told the BBC’s Sunday with Laura Kuenssberg. “Had we not acted, those blast furnaces would have been lost permanently. That was not an option.”
Once shut down, blast furnaces become nearly impossible to restart, which would effectively end primary steel production in Britain—a scenario Reynolds said would pose a serious threat to national economic security.
Jingye’s Withdrawal and the UK’s Emergency Response
According to government sources, Jingye had ceased ordering essential raw materials and had begun offloading existing stocks, signalling its intention to shut the plant. The firm reportedly rejected a £500 million support package from the UK government, instead demanding over £1 billion without assurances that it would keep the furnaces running.
Reynolds accused Jingye of failing to negotiate “in good faith” and operating in a way that was either “neglectful” or “irrational.”
Economic and Strategic Implications
British Steel’s Scunthorpe site is the UK’s only facility capable of producing high-grade virgin steel—essential for railways, bridges, wind turbines, and defence equipment. If lost, the UK would become the only G7 country without the capacity to manufacture this foundational industrial material.
“This is about more than jobs—it’s about resilience,” said Reynolds, underlining that the future of British steel is tied to the UK’s green energy transition and sovereign capability in key industries.
Political Divisions and Calls for Industrial Strategy
The opposition has sharply criticised the government’s timing. Conservative shadow business secretary Andrew Griffith described the intervention as a “botched nationalisation” that should have come earlier, although he conceded it was the “least worst option” under the circumstances.
Former UKIP leader and Reform UK head Nigel Farage went further, denouncing the 2019 sale of British Steel to Jingye as “a strategic error.” He argued that the UK must fundamentally rethink how it approaches ownership of key industries, calling the current situation an “industrial massacre.”
Meanwhile, Green MP Ellie Chowns and Liberal Democrat Daisy Cooper both stressed the importance of steel for Britain’s long-term green ambitions. They called for a sustainable, state-backed industrial strategy to replace what they describe as short-term fixes.
What’s Next for British Steel?
The government is now actively searching for a new buyer for the Scunthorpe plant, with Reynolds confirming that any potential sale to another Chinese firm is off the table. He also admitted the current market value of British Steel is effectively zero, with taxpayer funds now required to support £700,000 in daily operational losses.
The full cost to the public purse remains unknown. While critics demand accountability and transparency, the government insists its priority is to stabilise the plant, protect jobs, and preserve a strategic industry.
As the UK navigates this industrial inflection point, questions loom over whether this intervention marks the start of a broader reassessment of foreign ownership in critical sectors—and whether the UK can build a resilient, future-proof steel industry for the decades ahead.
