Business Secretary Peter Kyle’s admission that the government was “forced to change plans” by a “slew of crises” reveals the desperate context for the new steel strategy. The shift to electric arc furnaces (EAFs) is not just a green choice; it’s a defensive move in a “highly complex global environment.”
What are these crises? Kyle named several. First, “the impact of tariffs,” citing the “chaos” caused by Donald Trump’s trade levies. These have disrupted global markets and made UK steel less competitive.
Second, “the impact of oversupply.” The text highlights a “huge amount of steel” that has “continued to flood global markets from China.” This dumping of state-subsidised steel has cratered prices and made traditional, high-cost UK production unviable.
These external factors directly led to the internal crises: the near-collapse of British Steel (rescued in April) and the insolvency of Liberty Steel (in August). These events, in turn, have drained “hundreds of millions” from the £2.5bn steel fund.
The EAF plan is therefore a response to this. It’s an attempt to create a “cleaner,” more modern industry that is less exposed to these global shocks. However, this response to a global crisis is now creating a domestic crisis over jobs and industrial capability.