After the May announcement, today the United Kingdom proceeded with the nationalization of the steel company British Steel, long in loss – and under extraordinary administration – but significant because it owns the country’s last blast furnaces.
BRITISH STEEL AND NATIONAL INTEREST
According to the government, the public intervention in British Steel – which dates back to April 2025, in the form of operational control takeover – was necessary to safeguard the national interest. The Scunthorpe plant, in fact, employs 2,700 workers and hosts the last two active blast furnaces in the United Kingdom, extremely important because they produce primary steel, a variety obtained from iron ore that is qualitatively different from “secondary” steel, made from scrap.
The site produces 95 percent of the steel used in the British railway network, for example, but primary steel is also essential for the automotive industry.
THE DISPUTE WITH THE CHINESE GROUP JINGYE
The London government, in short, wants to avoid the closure of the blast furnaces planned by the Chinese group Jingye, which had acquired British Steel in 2020 but effectively lost control of it in 2025.
Last month, outgoing Prime Minister Keir Starmer explained that the government had opened negotiations with Jingye about British Steel, but “a commercial sale was not [possible]”: the Chinese company had rejected the £100 million offer presented by London, demanding compensation of over £1 billion.
Last Monday Jingye said it demands “timely, adequate and effective” compensation for the investments made in British Steel, specifically in the “modernization of plants, safeguarding jobs, and the green transition.”
HOW MUCH HAS THE UNITED KINGDOM SPENT ON BRITISH STEEL?
British Business Secretary Peter Kyle explained that so far the government has spent over one million pounds a day – totaling 640 million – to keep British Steel’s plants running. The company has struggled to sustain the high energy costs and international competition – mainly Chinese – characterized by an overproduction of low-priced steel. Nevertheless, Kyle added, “we need that virgin steel production because, if it were to disappear, we would end up at the mercy of international markets and supplies coming from other countries.”
In his view, public spending on British Steel “is good value for money for British citizens, but we must ensure that this company moves forward.”
AND NOW?
Gareth Stace, director general of the trade association UK Steel, has positively welcomed the nationalization of British Steel, arguing that it will provide “certainty” to workers and customers. However, he believes that nationalization should not be considered “an end goal,” but the starting point of “a clear and credible long-term plan,” accompanied by an investment strategy.
In this regard, the government would like to encourage the electrification of British Steel’s processes to reduce emissions, but the transition would likely cause the loss of thousands of jobs.
PARALLELS WITH ACCIAIERIE D’ITALIA
The case of British Steel is very similar to that of Acciaierie d’Italia: the former Ilva is also under extraordinary administration, depends on government loans, loses about one million euros a day, and owns the last active blast furnaces in our country.
Moreover, the English entrepreneur Michael Flacks – known for making a fortune by rescuing struggling companies and in negotiations to purchase Acciaierie d’Italia – had said he was interested in buying British Steel to merge it with the former Ilva and create a large European steel conglomerate.
