UK Steel

🆕 UK Steel joined a group of trade associations, businesses, and a union, from heavy-end electricity users to the renewable energy developers to write to Secretaries of State Ed Miliband and Jonathan Reynolds raising concerns over electricity market reforms, specifically the proposed zonal pricing model. The UK steel industry directly contributes £1.8bn to UK GVA, and supports a further £2.4 billion. Our sector directly contributes £3.4 billion to the UK’s balance of trade and some 34,000 jobs. Electricity prices have a disproportional impact on the industry's ability to compete, and electricity costs can be up to 180% of GVA of steel companies. Introducing locational pricing in our electricity system could increase the cost for steelmakers, as they are located in zones where prices would be higher and cannot merely relocate their site to Scotland to access lower prices. Alongside other industry bodies and renewable developers, we have asked the Government to reconsider a proposal to introduce locational electricity pricing, as this could make the overall electricity system more expensive and negatively impact the steel industry. RenewableUK Scottish Renewables Community Union Global Infrastructure Investor Association (GIIA) Make UK Offshore Energies UK Solar Energy UK British Glass Ceramics UK Frank Aaskov 🔗 Our story: https://lnkd.in/gAcascgc 🔗 The Guardian: https://lnkd.in/giVksjCw 🔗 The Financial Times: https://lnkd.in/gpHeHjmt 🔗 The Telegraph: https://lnkd.in/gz4d5hcd

❗ UK Steel report: New bold policies needed to tackle steel imports and ensure Government sees return on investments Measured as the gap between global capacity and crude steel production, global excess capacity in 2023 was estimated at 543 million tonnes (Mt), which is over 70 times the size of the UK market. Capacity expansions in Southeast Asia and the Middle East are continuing at an alarming rate – these are largely state-funded, mostly for high-emission blast furnaces and often do not correspond to domestic demand trends. Meanwhile, steel demand is weakening in China, translating into rising oversupply which is dampening steel prices and spilling over into other markets. Exports from China this year are expected to reach 100Mt, the highest since 2016, when the last steel crisis saw several steel plant closures and thousands of jobs lost across steelmaking countries including the UK. Addressing excess capacity and fair competition should be a fundamental element of any strategy for steel and action must be taken urgently ahead of existing protections lapsing. Trade policy must go further than it has before if industry is to have a fair chance of competing for market share.  📑 Read the full story and download the report here: https://lnkd.in/eTJemybc

🆕 The highly anticipated £4bn Net Zero Teesside project – led by bp and Equinor - has officially launched. Today’s confirmation of Government support for the big carbon capture, utilisation, and storage (CCUS) facility at Teesworks will allow work to start by the end of this year to allow operations to begin in 2027. The proposed power station will generate up to 860MW of low carbon electricity while up to two million tonnes of CO2 emissions from it will be captured each year. The Teesside scheme will include a CO2 gathering network of pipeline connections from industrial facilities on Teesside to transport the captured CO2. The project will feature the use of steel from LIBERTY Steel Group for the linepipe.

Last week, The Telegraph published figures showing the cost of power for industrial businesses has jumped 124pc in just five years, according to the Government’s figures, catapulting the UK to the top of international league tables. It is now about 50pc more expensive than in Germany and France (based on UK Steel statistics), and four times as expensive as in the US. Frank Aaskov of UK Steel, said to the Telegraph: “High industrial electricity prices have for too long damaged the competitiveness of UK steelmaking, and many in the wider manufacturing sector will be feeling the same pressure our steel companies do. The Government should tackle steep electricity costs and make the UK a fruitful place to invest, while enabling growth and improving competitiveness.” UK Steel Director General, Gareth Stace, confirmed to Minister Jones at the Labour Conference fringe on steel - where they shared a panel - that the solutions to provide truly competitive energy prices for steel are already on her desk, contained within UK Steel electricity price disparity report published just four weeks ago. 🔗 Telegraph story in full: https://lnkd.in/eQnNsYqU 🔗 UK Steel electricity price disparity report: https://lnkd.in/epbM5dSP

📰 EU looks to stronger trade protections The European Commission announced that it will register all imports of products under anti-dumping or anti-subsidy investigations, including ongoing investigations. The announcement stated: “This change in practice is aimed at stepping up/enhancing the use of trade defence instruments and is part of the Commission’s ongoing efforts to tackle the effects of unfair competition, including overcapacity.” Until now imports were usually registered only upon industry request with sufficient evidence to justify it. The change will enable the retroactive collection of anti-dumping and countervailing duties, prevent sharp increases in imports of products under investigation ahead of the imposition of measures and remove a procedural burden from industry. Meanwhile, there are suggestions that the EU industry is calling for stronger trade protections in preparation for the EU steel safeguards eventual expiry in June 2026. Overcapacity and unfair competition are similarly of major concern for the UK sector and UK Steel has been doing extensive work on this topic.

🆕 The Government has confirmed that it will align reforms to free allocations within the UK Emissions Trading Scheme (ETS) with the introduction of the UK Carbon Border Adjustment Mechanism (CBAM), delaying the UK ETS reforms to 2027. 🆕 This is a huge win for UK Steel, which has advocated that all carbon leakage policies should be aligned and strongly urged the Government to ensure that any changes to UK ETS and free allocations only happen in parallel with the introduction of the UK CBAM. UK Steel is still very concerned about the risk of trade diversion when the EU CBAM takes full effect in 2026, which could divert high-emission steel towards to UK market. The delay of the UK ETS reforms will mean that at least the existing protections will not be reduced in 2026, helping to potentially lessen the trade diversion risk. 🔗 Our full story with details: https://lnkd.in/e_vj8RAn 🔗 Info on the UK CBAM: https://lnkd.in/eWDQ7hWa #ETS #UKCBAM #EUCBAM #CarbonBorder #UKSteel #UKMfg Frank Aaskov

Our expert panel chaired by Roy Rickhuss of Community Union, Chris McDonald MP, Sarah Jones MP, and Gareth Stace of UK Steel discussed The Future of the Steel Industry in the UK this afternoon before a packed house at #LPC24

🗓 UK Steel's Gareth Stace will join the SME4Labour and Community Union fringe event The Future of the Steel Industry in the UK on Sunday. Held at 4pm, the expert panel will be chaired by Roy Rickhuss CBE, and includes Industry Minister, Sarah Jones, steel sector expert Chris McDonald MP, and long-established steel MP and Minister, Stephen Kinnock. 💡 Louise and Gareth will also both join Business Day on Monday to engage with experts on net zero, CCUS, trade and transport to ensure UK steelmaking is central to key discussions on infrastructure, energy, trade and construction. Do get in touch if you would like to meet. #LabourConference #LabourParty #Labour #Conference2024 #Steel

🗞 Friday news round up for UK steelmaking 𝗠𝗮𝗿𝗰𝗲𝗴𝗮𝗴𝗹𝗶𝗮 𝗦𝘁𝗮𝗶𝗻𝗹𝗲𝘀𝘀 𝗦𝗵𝗲𝗳𝗳𝗶𝗲𝗹𝗱 𝘁𝗼 𝗶𝗻𝘃𝗲𝘀𝘁 £𝟱𝟬 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 𝗶𝗻 𝗻𝗲𝘄 𝗘𝗹𝗲𝗰𝘁𝗿𝗶𝗰 𝗔𝗿𝗰 𝗙𝘂𝗿𝗻𝗮𝗰𝗲 𝗰𝗿𝗲𝗮𝘁𝗶𝗻𝗴 𝟱𝟬 𝗷𝗼𝗯𝘀 The Prime Minister confirmed in a statement this week that Marcegaglia Stainless Sheffield will be investing £50 million to build a new Electric Arc Furnace (EAF) to upgrade its existing site. The new ‘state of the art’ EAF will increase annual plant productivity to over 500,000 tonnes of stainless steel products, bringing efficiency and environmental improvements, and creating 50 new jobs. The existing EAF has been in place since 1977, producing stainless steel by recycling scrap steel. The new operation will be in the implementation phase during mid-2026. In a media release, covered by City AM, Business Matters, and Materials Recycling World to name a few, UK Steel Director General, Gareth Stace, said that this story “delivers yet more highly positive news for the UK steel industry... All that’s needed now to make these investments count is for the Government to deliver the competitive business landscape and level playing field that our steelmakers need for a bright future.”  ➡ Read the full story here: https://lnkd.in/eAp8hU6Z 𝗨𝗞 𝘀𝘁𝗲𝗲𝗹𝗺𝗮𝗸𝗲𝗿𝘀 𝗳𝗮𝗰𝗲 𝗱𝘂𝗺𝗽𝗶𝗻𝗴 𝗿𝗶𝘀𝗸 𝗼𝘃𝗲𝗿 𝗘𝗨 𝗰𝗮𝗿𝗯𝗼𝗻 𝘁𝗮𝘅 𝘁𝗶𝗺𝗶𝗻𝗴, 𝗶𝗻𝗱𝘂𝘀𝘁𝗿𝘆 𝘄𝗮𝗿𝗻𝘀 In this week’s Financial Times, UK Steel raised concerns over high-emission steel flooding the market. UK Steel has been urging Ministers to bring forward the start date of the British Carbon Border Adjustment Mechanism (CBAM) scheme to 2026 to align with Europe for some time. Gareth Stace said the delay in introducing the UK CBAM would lead to dumping. UK Steel calculates that an EU company importing steel from a carbon-intense producer would face charges of around €37.50 per tonne. In today’s steel market, a fluctuation of €5 can be enough to renegotiate a contract. The EU CBAM cost may mean that high-emission steel is pushed to other open markets, like the UK. “The UK should bring forward its UK CBAM to 2026... I fear that HM Treasury is underestimating how rapidly trade flows can change in the steel market," he said. ➡ Read the full story here: https://lnkd.in/g5ejWGyZ #UKSteel #Steel #UKMfg #Mfg #CBAM #EUCBAM #UKCBAM

Materials Processing Institute CEO welcomes the Government’s confirmation of a £500 million grant to Tata Steel to support the construction of an Electric Arc Furnace (EAF) at Port Talbot, South Wales. https://lnkd.in/eNqqipig Terry Walsh Tata Steel UK #steel