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British Steel will likely say on Wednesday that its coking ovens in Scunthorpe will close, putting 300 people out of work.
When the store will close and how many jobs will be lost must be clear.
Coke is made in coking ovens. Coke burns hotter than coal and can be used in the two blast furnaces still in use.
Because the plant is closing, British Steel will have to bring in coke.
People are worried about the health of the UK steel industry since the coking ovens have been shut down.
The business is “on a knife edge,” union leaders told the BBC.
Sources in the government said that the decision was “disappointing” because Jingye and Tata, two Chinese companies that own British Steel, are still talking with the Treasury about a package of aid that would give each company £300 million.
Union sources say that the government’s offers have been turned down because they have too many conditions, like a promise of a ten-year job.
They also said that the offers needed to be bigger to help pay the estimated $2 billion cost of switching from blast furnaces to electric arc furnaces, which use less energy.
Electric arc furnaces don’t get hot enough to make Steel from scratch, so they use Steel that has already been made. At the moment, sending scrap steel to Turkey and Indonesia is cheaper than recycling it here.
Business Secretary Kemi Badenoch recently said that the UK doesn’t need a steel industry but that the industry is important “in the communities where they operate.”
Next week, people will talk about who will be fired and who will be left alone. There are also rumors that the plant might close by the end of the year.
People are also afraid that the plant will lose more jobs.
At the start of February, British Steel was thinking about cutting 800 jobs at its plant in Scunthorpe.
At the time, someone from Jingye said that the talks with the government about the support needed to be better.
The representative said that the proposed aid package should have done something about the high costs of energy, labor, and carbon and the low demand in the home market.
British Steel could get rid of 800 jobs
The BBC is aware that British Steel is thinking about cutting 800 jobs at its Scunthorpe plant.
The company has started making plans, but they still need to finish the paperwork before they can meet to talk about letting people go.
A source says that a representative of Jingye, the Chinese company that owns British Steel, said that talks about a £300 million government aid package needed to be better.
British Steel didn’t want to say anything.
About 4,500 people work for the company in the UK.
The BBC thinks that one of the plans is to shut down the coking ovens at the company’s site in Scunthorpe. This could put 300 jobs at risk.
Hundreds more jobs would be looked at, which could lead to the loss of up to 800 jobs.
People are worried that because energy costs are going up, British Steel might have to shut down some of its operations.
Last month, the Chancellor was “set” to approve the £300 million support package for the struggling steelmaker to help with decarbonization efforts as long as Jingye promised jobs and invested money.
The company’s plan to cut 800 jobs made it harder for the government to help the company.
A source said that a Jingye representative said that talks about the decarbonization package needed to be better during a meeting with top union officials on Wednesday.
According to the source, a company representative told a translator, “The money promised is for investments, and it’s the same money that was promised to steel producers a long time ago.”
The investment doesn’t fix the problems like high energy costs, high carbon costs, low domestic demand, and high labor costs that are driving up costs right now.”
The person also said, “Internationally, British Steel can’t compete because it has high production costs.”
The government said the steel industry was “vital” to the UK economy and “committed to ensuring the UK steel sector has a strong and competitive future.”
The Community Union, which represents steelworkers, was worried about the planned cuts.
A national officer named Alun Davies said: “This would be a betrayal of the loyal workers at [British Steel] and their promises to invest in the business.
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When British Steel went bankrupt three years ago, Jingye bought it and became the third owner in four years.
But recently, the Chinese steel giant has been trying to get money from UK taxpayers by saying it needs the money to keep the business going.
At the price of energy right now, it’s very expensive to make Steel.
