The British Steel Industry is Showing Signs of Recovery
Some of the latest news coming out of the White House is that Donald Trump is ready to impose steep steel and aluminium import tariffs on US allies as part of his strategy to “make America great again”. The US’s closest trading partners are Canada, Mexico and the European Union (the three combined supply more than half of the steel that the US imports annually) had previously been granted a temporary exemption from the tariffs, with the EU vowing to aggressively strike back at the US. Until the UK leaves the EU, UK steelmakers are likely to face the same tariffs as the EU.
Here at Safety Fabrications we rely on steel and the British steel industry in particular. After all, we’re based in Sheffield, a city with an international reputation for steel production. The city has been the base for so many innovations in steel production, including the invention of the crucible and stainless steel.
Our products are fabricated from mild steel, stainless steel and aluminium and all of our products are manufactured in accordance with BS EN ISO 3834-2:2005 and BS EN 1090-2:2008 and carry the CE Marking which proves compliance with European and UK standards. Steel is vital to our business here at Safety Fabrications so a recovery in the British steel industry is good news for us.
Despite weathering the global recession of 2008 – 2009, the steel industry here in the UK faced a real crisis in 2016 with several steel companies announcing job losses due to plummeting global steel prices, a flood of imports, unfavourable exchange rates and high energy costs. However, in recent months steel prices have recovered and an improvement in the global growth forecast has meant good news for steelworkers and manufacturers in Britain.
Prince Charles recently visited a South Yorkshire steel mill and reignited the larger of its two electric arc furnaces that had been dormant for the past two years, a symbolic moment of rebirth for the British steel industry. Steel represents only 0.1% of the UK economic output at present and employs just 30,000 people, less than a tenth of its workforce in the 1960s when it was viewed as the cornerstone of the UK’s manufacturing sector. In the intervening years, many UK steel producers shifted their focus from commodity grade steel towards more valuable forms of the metal in order to survive.
However, it’s too soon to celebrate properly as it’s still not clear whether the steel industry has pivoted enough to weather another downturn in the global steel market which is particularly prone to boom and bust. Indian owned Tata Steelworks in Port Talbot in South Wales is showing an improved financial performance since persuading regulators to sign off the restructuring of a £15 billion retirement fund to prevent the plant becoming insolvent. As Britain’s largest steelworks, Tata was at one point losing up to £1 million per day!
Scunthorpe’s steelworks is also enjoying a resurgence as one of the two remaining integrated steel plants (producing steel from raw materials) in the UK.
The British steel industry has benefited from the fall in sterling following the Referendum, lowering the costs of exports while demand in Europe is still strong. However, experts warn that there is still a “global oversupply” of steelmaking capacity, so the struggle is still not over.