Scunthorpe steel crisis: ‘Steel is part of its past, its present, and should be part of its future’
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The town of Scunthorpe faces a perilous future with the Chinese-owned British Steel plant facing closure due to enormous losses the company has faced in recent years. What can be done to save the industry, and the town itself?
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In brief…
- Scunthorpe’s British Steel plant is recording reported daily losses of £700,000, leading to fears it will close, which would result in job losses for around 2,700 people.
- There have been widespread calls for British Steel to be nationalised, but serious investment and support from the UK government would be needed to prevent those losses being passed on to the taxpayer.
- Nic Dakin, Scunthorpe’s Labour MP, tells The News Agents that steel has been part of the town’s past and present, and should be part of its future as well.
What’s the story?
Scunthorpe is facing the "worst crisis" of its history, with the town's British Steel plant, owned by Chinese company Jingye, facing an uncertain future due to huge losses since it purchased the business in 2020.
Around 2,700 people of Scunthorpe's 81,000 people population are employed by the steelworks.
In March 2025, Jingye said its operation was no longer financially sustainable.
Since then, the government has been engaged in talks with its owners in an attempt to keep its furnaces burning in order to keep producing steel.
Jingle has previously rejected a £500 million offer from the government to convert its furnaces to electricity, and this week it was reported it also offered to fund the purchase of the raw materials the steelworks needs to keep working.
The steel industry has been hit by Donald Trump's tariffs, imposing a 25% import tax on all steel products entering the US, which remained in place when the US administration 'paused' most country-specific tariffs.
Is Nigel Farage steel industry support welcome in Scunthorpe?
Impact of potential closure would be felt across the UK
Councillor Rob Waltham, leader of North Lincolnshire Council, tells Lewis Goodall he receives hundreds of messages a day from local people looking for updates and reassurance on the situation.
"The government is investing more in security, but yet, we wouldn't be able to make any of the products that make us more secure," he says of the potential closure of the Scunthorpe British Steel plant.
"This is not just about the aftershock this would have on this community, it's the impact it would have on this nation's ability to be productive and not to be hostage to the fortunes of other players."
He backs calls for nationalisation of British Steel, with the government having intervened during previous industry collapses in the town.
"The reason why we've locally called for nationalisation, is there's a history of this," he says.
"When the last business failed here, the government stepped up, paid the wages, and all but nationalised it for that period."
But while calls for nationalisation are widespread, there are concerns this could result in a reported £700,000 daily loss made by the Scunthorpe British Steel plant being passed on to the taxpayer.
Nic Dakin, Scunthorpe's Labour MP, believes that investment and support from the government could prevent this.
"I think there is a path," Dakin tells The News Agents.
"The question is, do we need our own UK construction steel industry? Is that part of our national security?
"If the answer to that is yes, then the government needs to act to secure that – and I think the answer to that is yes."
He adds that what is needed is "the hard yards of rolling people's sleeves up" in order to secure a deal with Jingye.
"If this company won't do a deal, then the government must step in and take control of the situation. That's what the current government is doing, and that's the right thing to be doing."
Dakin describes Jingye's conduct during the talks as "reckless", with previous industry closures in Scunthorpe having been more "managed" than the current situation.
Dakin believes if Jingye had accepted the government's half-billion offer, it would make a profit, despite the owners claims of staggering losses.
The need for green steel
Dakin says the key to that is making the move from "blast furnace steel to electric arc steel on a sustainable footing", tying into the government's Net Zero pledges, as well as security the industry.
"The reality is that the customer base in Europe and in the UK has moved towards wanting green steel, and if we want to remain profitable and effective, we need to be able to deliver that," he says.
Waltham says the biggest issue facing the steel industry is its reliance on fossil fuels as the world seeks greener alternatives, and while there are options to improve its carbon footprint, a truly green steel industry is not yet viable.
"If we can't deliver our own rail steel that's pretty serious," Waltham adds.
"There is this agenda around making sure that we make a cleaner steel product but there's no technology there to be able to do that yet, so it would be years before they can deliver a green steel product from this site.
"In the meantime, it seems perverse that we would buy in steel from across the world just to say we've done something a bit cleaner. We'd just be buying the same steel we could have made here."
Doubt cast on Nigel Farage support
When The News Agents visited Scunthorpe, local people told Lewis of their disillusionment in Keir Starmer and the Labour government, backed calls for nationalisation of British Steel, and spoke of support in the community for Nigel Farage.
The Reform UK leader recently visited the steelworks in Scunthorpe, but both Waltham and Dakin have said they are dubious about the authenticity of his visit, and anyone else trying to weaponise the situation in the town for political advantage.
"Those people turn up with their easy solutions. They're flag waving. But frankly, they are not friends of this business," Dakin says.
"They are people trying to take advantage of a crisis, and people need to be very careful about getting into bed with them.
"I'm talking about anybody who comes up with easy answers that has been seen nowhere until just now."
And while Waltham says he has spoken with senior government officials about the future of Scunthorpe's steel industry, he's never once been contacted by Farage.
Scunthorpe population facing ‘pain and difficulty’
But while the situation involves politically motivated decisions, huge sums of money and international trade, the real heart of the story are the people of Scunthorpe, and the thousands of people who will be affected if an agreement can't be met and the steel plant is shut down.
Dakin says the closure of the British Steel plant would be "devastating" for Scunthorpe and neighbouring communities.
"I'm really worried about the pain and difficulty that steel workers and their families are going through at the moment," he says.
"This is a very difficult time, but we are a resilient community, and we would find another direction for this community.
"This community has been built on steel, and steel has been part of its past. It's part of its present, and it should be part of its future."
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