The survival of Britain’s steel industry hinges on embracing new technologies and shifting to greener production methods, a British MP told The National.
Nic Dakin, the MP for Scunthorpe, where British Steel has a large steelmaking plant, said that the industry is undergoing significant restructuring that could provide this industry a positive future for the UK.
We need a steel industry, Ironically, we need a steel industry to help green our future.” He commented.
Blast furnaces have been a cornerstone of Britain’s steel industry for over a century, and are significant contributors to the country’s carbon emissions. However, the growth of green technologies and the introduction of electric arc furnaces are driving a transformative shift in the industry, for more sustainable production methods.
“If it wasn’t for climate change, we would simply say ‘we don’t do steel anymore in the UK’ – there’s considerable overproduction of steel globally, and other countries currently do it cheaper than we do,” Paul Ekins, professor at the UCL Institute for Sustainable Resources and author of Stopping Climate Change: Policies for Real Zero told The National commented.
Reports shows that British steel is already making efforts for a greener and lower-carbon future as a part of which four blast furnaces were closed at the UK’s largest steelmaking plant at Port Talbot in South Wales.
Tata Steel has shut down its last coking coal-fired blast furnace as part of its strategy to reduce carbon emissions. The furnace will eventually be replaced with electric arc furnaces (EAFs). Alongside this transition, Tata announced a restructuring plan that will result in the loss of 2,800 jobs, despite political backlash.
Three months after the blast furnace at Port Talbot was shut down, the UK government held the first meeting of the Steel Council on Tuesday. The council includes the chief executives of Tata Steel, British Steel, and Liberty Steel, representatives from the GMB Trade Union, companies such as Marcegaglia UK that use steel products, and government ministers.
A report by UK Steel has revealed a significant oversupply in the global steel industry, with excess capacity in 2023 estimated at 543 million tonnes, which is over 70 times the size of the UK market. Weakening demand in China has further included the issue, with the country’s steel industry expected to have exported more than 100 million tonnes last year, an amount sufficient to meet UK steel demand for 13 years.
While the influx of cheaper steel poses challenges for domestic producers worldwide, including in the UK, the shift toward low-carbon steel production through electric arc furnaces (EAFs) presents a potential opportunity.
The market for low-carbon steel is expected to grow in the coming years, and for now, it commands higher prices than traditional steel, offering a competitive edge to producers investing in greener technologies.