British Steel has passed an important tipping point! They recently won a five-year, £500 million contract to provide railway track for Network Rail. This contract starts on July 1. It will manufacture more than 337,000 tonnes of track, further cementing British Steel’s role as a key supplier to the UK’s rail network.
Through this contract, British Steel will still provide 80% of Network Rail’s track needs under specification. This partnership further emphasizes the company’s vital importance in the rail industry. It makes the case for the creation of robust domestic manufacturing capabilities within the UK more urgently than ever.
The Scunthorpe steelworks, owned by British Steel, is notable for being the last plant in the UK that produces virgin steel. This facility employs approximately 2,700 individuals and operates four blast furnaces, all named after English queens: Bess, Mary, Anne, and Victoria. Today, only two of these furnaces are still operational—Bess and Anne.
In 2020, British Steel went into insolvency, finally being bought out of receivership by the Chinese conglomerate Jingye. Then, in April of this year, the UK government nationalized the company after fears emerged about its solvency. Two months prior to the contract unveiling, the federal government moved in a bold fashion. They invoked emergency powers to prevent the sudden closure of the blast furnaces, as rumors swirled that Jingye planned to close down these essential facilities.
The uncertainty surrounding the UK’s steel industry has been exacerbated by the impending closure of Port Talbot’s blast furnaces in 2024. This situation has led to increased scrutiny over the sustainability of domestic steel production and its implications for infrastructure projects across the nation.
Craig Harvey, the commercial director for rail at British Steel, emphasized the contract’s significance:
“This contract is crucial to our operations and highlights our importance to the UK’s economy and infrastructure.”
Network Rail’s director for railway business services, Clive Berrington, expressed support for British Steel’s role in the industry, stating:
“We are committed to buying British where it makes economic sense to do so.”
Together with a recently announced Scunthorpe plant contract, this new contract helps ensure Scunthorpe plant jobs. It marks a significant effort, both practically and politically, to bolster domestic manufacturing and supply chains in the UK. To their credit, the government has accepted that British Steel is of national critical importance. It is critical to the health of both our rail network and a robust domestic steel industry.
The UK faces profound crisis around steel manufacturing and procurement. That’s why this contract represents a huge, positive step in the right direction toward using local resources, big or small, effectively. Together British Steel and Network Rail are working hard to support British industry. This joint effort meets today’s economic crisis with both centrality and urgency.