Out of Money and Out of Time, British Steel Works Shuts Down
10/13/2015 - The coke ovens and blast furnace at Sahaviriya Steel Industries’ (SSI)idled Redcar works in England are being shut down permanently, bringing to an end to nearly 100 years of steelmaking at the site.
According to the BBC, the coke ovens had been kept alight until the weekend to allow for negotiations with prospective buyers. But official receiver Ken Beasley said there was no "realistic prospect" of a sale and he could no longer spend taxpayer money to keep the plant going, the BBC reported.
"I cannot continue to draw on taxpayers' funds to keep the ovens operational when there is no realistic prospect that a buyer will be found,” Beasley said. "I am continuing my liquidation of the company, including talking with interested parties about purchasing the company's other assets."
SSI acquired the Redcar works from Tata Steel in 2011 and puts its blast furnace back into production. However, the operation struggled stuggled to turn a profit on account of debt and market conditions, including low steel prices and high energy costs.
SSI UK suspended production at the plant in September, and the company was put into liquidation earlier this month.
About 1,700 people were laid off, but at least 500 workers were kept on while the liquidator held discussions with potential buyers for the plant. But with no buyer stepping forward, it appears those jobs will be lost as well, according to the The Guardian newspaper.
Regional lawmakers and labor unions are renewing calls for government intervention.
The labor union Unite described the government’s handling of the Redcar closure as “laissez-faire” and warned that it set “a dangerous precedent for an industry battling to stay afloat," according to The Guardian.
“Steelmaking in the U.K. is at a crisis point. It is time for the government to stop hiding behind EU rules and follow the lead of the Italian, French and German governments by intervening to save a critical part of the British economy,” Unite national officer Harish Patel said, according to The Guardian.
The Telegraph newspaper said the government is holding a summit on Friday to discuss the country's steel industry crisis.
Member of Parliament Anna Soubry told the newspaper that she had hoped a commercial buyer for the coke ovens could be found.
"But unfortunately this has not happened," she said. “The government will continue to focus on making sure we do whatever we can to help people," she said, adding that an aid package of GBP80 milllion will help with worker retraining.
"I cannot continue to draw on taxpayers' funds to keep the ovens operational when there is no realistic prospect that a buyer will be found,” Beasley said. "I am continuing my liquidation of the company, including talking with interested parties about purchasing the company's other assets."
SSI acquired the Redcar works from Tata Steel in 2011 and puts its blast furnace back into production. However, the operation struggled stuggled to turn a profit on account of debt and market conditions, including low steel prices and high energy costs.
SSI UK suspended production at the plant in September, and the company was put into liquidation earlier this month.
About 1,700 people were laid off, but at least 500 workers were kept on while the liquidator held discussions with potential buyers for the plant. But with no buyer stepping forward, it appears those jobs will be lost as well, according to the The Guardian newspaper.
Regional lawmakers and labor unions are renewing calls for government intervention.
The labor union Unite described the government’s handling of the Redcar closure as “laissez-faire” and warned that it set “a dangerous precedent for an industry battling to stay afloat," according to The Guardian.
“Steelmaking in the U.K. is at a crisis point. It is time for the government to stop hiding behind EU rules and follow the lead of the Italian, French and German governments by intervening to save a critical part of the British economy,” Unite national officer Harish Patel said, according to The Guardian.
The Telegraph newspaper said the government is holding a summit on Friday to discuss the country's steel industry crisis.
Member of Parliament Anna Soubry told the newspaper that she had hoped a commercial buyer for the coke ovens could be found.
"But unfortunately this has not happened," she said. “The government will continue to focus on making sure we do whatever we can to help people," she said, adding that an aid package of GBP80 milllion will help with worker retraining.
