LIBERTY Steel Proposes Key Measures to Drive Demand & Investment in UK Steel Sector
LIBERTY Steel, one of the leading steel producers in the UK, has submitted a transformative set of proposals aimed at revitalizing the country’s steel industry. As part of the UK Steel Strategy consultation, LIBERTY’s submission seeks bold, demand-side measures, strategic investments, and policy changes that would reverse the long-term decline in UK steel production. LIBERTY’s recommendations focus on generating greater demand for UK-made steel and ensuring that the UK remains competitive in a global market that is increasingly favoring sustainable, low-carbon products.
Proposing a Steel Obligation to Stimulate Domestic Demand
A central proposal within LIBERTY's submission is the introduction of a Steel Obligation, modeled after the Renewables Obligation in the energy sector. The Renewables Obligation, which has successfully driven the uptake of renewable energy in the UK, has played a significant role in encouraging investments in renewable power. Similarly, LIBERTY suggests adapting this model to the steel industry by introducing a Steel Obligation that would require key industries to procure a percentage of their steel from domestic sources.
How the Steel Obligation Would Work:
• Demand for Domestic Steel: Under the proposed Steel Obligation, various industries—such as construction, defense, aerospace, and civil infrastructure—would be required to source a portion of their steel from UK mills. This policy would create a steady demand for UK-made steel, particularly scrap steel, produced by domestic manufacturers, thereby increasing production and ensuring more jobs in the sector.
• Resilient, Low-Carbon Value Chain: By ensuring that steel procurement prioritizes domestic sources, the Steel Obligation would help create a more resilient and low-carbon steel value chain in the UK. This would also align with the government’s climate change targets by supporting the transition to greener, more sustainable industrial practices.
• Incentivizing Investment in Steel Production: Similar to the Renewables Obligation, a Steel Obligation would incentivize investment in sustainable steel production technologies. By ensuring consistent demand, UK steel producers would be encouraged to invest in modern, energy-efficient, and low-carbon steel production.
LIBERTY’s Chief Transformation Officer, Jeffrey Kabel, commented on the proposal, saying, “We believe that the Steel Obligation can help stimulate demand for UK steel and create a stable market that encourages long-term investment. Just as the Renewables Obligation transformed the UK’s energy sector, this policy could help transform the UK steel industry by making it more sustainable and competitive.”
Strategic Investments to Strengthen Steel Production Capacity
In addition to stimulating demand through the Steel Obligation, LIBERTY has outlined a series of strategic investments in its existing mills. These investments are aimed at increasing production capacity and enhancing the capabilities of the steel sector to serve emerging industries such as offshore wind, aerospace, and defense.
1. Rotherham Mill Upgrades
• EAF and Slab Caster Expansion: LIBERTY is proposing an upgrade at its Rotherham mill, including the installation of a new Electric Arc Furnace and slab caster. These upgrades could increase the mill's production capacity from 1.2 million metric tons per annum to 2 million metric tons per annum, enabling it to better meet the growing demand for steel in industries like offshore wind.
• Offshore Wind Towers: As offshore wind continues to grow as a key part of the UK’s green energy strategy, there is an increasing need for high-quality steel to construct wind towers. By boosting Rotherham’s production capacity, LIBERTY aims to position itself as a critical supplier to the offshore wind sector, which requires substantial amounts of steel for both fixed-bottom and floating offshore wind towers.
LIBERTY Steel’s Mark Bula, CEO, emphasized, “The steel produced at Rotherham will be pivotal for growing the offshore wind sector, a critical part of the UK's energy future. Expanding our capacity here will ensure that the UK offshore wind industry is not reliant on imported steel, thereby strengthening our economy and creating jobs.”
2. Dalzell Plate Mill Enhancement
• Increased Plate Capability: LIBERTY is also focusing on upgrading its Dalzell plate mill, which would allow the plant to meet almost all of the offshore wind tower requirements in the UK. The plate mill enhancement would not only improve the mill’s efficiency but also allow it to produce steel more suited to the specific needs of offshore wind projects.
• Internalizing the Offshore Wind Value Chain: By strengthening its capabilities at Dalzell, LIBERTY aims to internalize more of the offshore wind value chain, ensuring that the UK is less reliant on foreign steel supplies for wind tower construction. This could also pave the way for future complementary investments in wind tower manufacturing within the UK, reducing dependence on foreign suppliers and retaining more value within the country.
The owners of Vogten Staal, Dennis Vogten and Jack Papen, highlighted the importance of local steel production in the growing wind industry: “As one of the few large-scale steel service companies in Western Europe that keeps our own product inventory, we are thrilled to include LIBERTY’s low-carbon steel in our portfolio, ensuring that we can meet the growing demand for sustainable steel in the wind sector.”
A New UK Steel Policy for the Global Economic Landscape
LIBERTY’s proposals are not just focused on immediate gains for the steel sector but are part of a larger strategy to position the UK steel industry as a global leader in low-carbon steel production. With growing international competition, rising protectionism, and geopolitical instability, LIBERTY believes the UK must shift its policies to protect and promote domestic steel production.
Jeffrey Kabel elaborated, saying, “The UK’s steel industry has tremendous strengths. However, policy changes are needed to ensure sustainable demand for UK-made steel and keep our industry competitive on the global stage. Other countries are supporting their steel sectors, and if we do not adopt similar policies, we risk being left behind.”
Ensuring Long-Term Prosperity for the UK Steel Industry
LIBERTY argues that, by adopting these policy measures, the UK could not only safeguard its steel industry but also ensure a more prosperous and resilient economy. By encouraging domestic steel production, the government would ensure that the value created in the steel sector stays in the UK, leading to more investment, jobs, and economic growth.
LIBERTY’s proposals highlight the importance of creating a strategic link between steel production and key industries like offshore wind, aerospace, and defense. By ensuring that these industries rely on domestic steel, the UK would be better equipped to meet the challenges of the future and become a global leader in sustainable industrial solutions.
Key Takeaways:
• Steel Obligation Proposal: LIBERTY proposes a Steel Obligation that would require industries to source a portion of their steel from UK mills, boosting demand for domestic steel.
• Rotherham Mill Capacity Increase: Upgrades to the Rotherham mill could increase production from 1.2 million metric tons per annum (Mtpa) to 2 million metric tons per annum (Mtpa), enhancing steel production for industries like offshore wind.
• Dalzell Plate Mill Upgrades: The Dalzell plate mill enhancement will allow it to meet almost all of the UK’s offshore wind tower requirements, ensuring domestic steel is used in wind tower construction.
• Focus on Low-Carbon Steel: LIBERTY is committed to producing low-carbon steel, helping meet the UK’s climate change goals while supporting green industries like offshore wind and aerospace.
• Policy Shift Needed: LIBERTY advocates for policy changes to support sustainable demand for UK-made steel, ensuring that the UK remains competitive in a global steel market.
• Economic and Job Growth: The proposals would foster investment in steel production, creating more domestic jobs, and generating economic prosperity within the UK.
• Building a Resilient Steel Industry: LIBERTY’s plan emphasizes the importance of strategic investments and demand-side policies to create a resilient, low-carbon steel sector for the future.
These proposals, if adopted, could fundamentally transform the UK steel industry, ensuring it remains competitive, sustainable, and able to meet the demands of a low-carbon economy.
