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UK Government Takes Over British Steel Operations from Chinese Owner
Emergency Action to Protect National Steelmaking:
The UK government has stepped in to take full control of British Steel’s operations at its Scunthorpe plant. This move came after the company’s Chinese owner, Jingye Group, revealed plans to shut down the site’s blast furnaces. The plant is the last facility in Britain that produces steel from raw materials—also known as virgin steel.
The takeover is considered a crucial decision to protect national interests, save thousands of jobs, and ensure the UK maintains its domestic steel production capabilities.
Jingye Group Planned Shutdown Due to Heavy Losses
British Steel, under the ownership of Jingye Group, has reportedly been losing about £700,000 each day. Rising operational costs, stricter environmental rules, and increased carbon prices were key reasons for the Chinese firm’s decision to halt production at the Scunthorpe site.
Jingye had been pushing to replace the blast furnaces with more eco-friendly electric arc furnaces. However, this plan would have led to major job cuts and would’ve ended the UK’s ability to produce virgin steel.
Prime Minister Calls Emergency Parliament Session
In a rare move, UK Prime Minister Keir Starmer called Parliament into session on a Saturday to pass emergency legislation. The newly passed Steel Industry (Special Measures) Act 2025 gives Business Secretary Jonathan Reynolds the power to manage British Steel’s day-to-day operations.
The law allows the government to:
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Secure ongoing worker payments
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Purchase essential raw materials like iron ore and coal
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Oversee logistics, including train operations at the plant
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Prevent any shutdown of critical furnaces
Focus on Jobs, Security, and Industrial Stability
The Scunthorpe facility employs around 2,000 people directly and supports many more in the supply chain. Government officials stressed the importance of protecting these jobs, as well as the broader economy, especially industries that rely on high-quality steel—such as construction, defense, and rail transport.
Maintaining the plant's operations is also considered essential for national security. Britain’s ability to produce its own steel ensures the country is not overly dependent on foreign imports, particularly during global supply chain disruptions.
Nationalization May Follow If Needed
Although the government now controls the plant’s daily operations, Jingye Group still officially owns British Steel. However, officials have stated that full nationalization is an option if the current measures don’t lead to a long-term solution.
The goal is to give the plant a chance to continue operating until a more sustainable model—potentially including government investment in green steel technology—can be put in place.
