British Steel may consider closing its rolling mills at Scunthorpe if the last blast furnace there is shut down. Rolling lines, powered by gas from blast furnaces, have been intermittent recently due to furnace instability and gas shortages.
If the blast furnace is closed and semi-finished products are imported, the heating furnaces will have to be retrofitted to run on a different type of gas. Lack of investment in gas supplies could lead to the closure of rail production at Scunthorpe. Rail products are one of British Steel's most profitable businesses.
Product availability has already been affected by the company's transition to a single furnace operating model and the problems it has experienced. In addition, the future of British Steel's owner, Jingye Group, remains uncertain. Executives of the British unit and local officials are visiting China to hold talks with the Chinese. The weakness in the Chinese market is also reportedly affecting Jingye financially.
British Steel has requested a government support package of USD 732 million to cover the costs of switching from blast furnaces to electric arc furnaces at its steel plants in Scunthorpe and Teesside in June 2024.
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