Liberty Steel official calls SSUK’s compulsory liquidation ‘irrational’
Liberty Steel’s chief transformation officer has described Speciality Steel UK (SSUK) being pushed into compulsory liquidation by the high court in London as “irrational”, Kallanish learns.
Jeffrey Kabel says in a statement that the decision “especially when we have support from the world’s largest asset manager to resume operations and facilitate creditor recovery is irrational.”
The company will now enter administration. It has been placed under the control of special managers appointed by the government’s official receiver.
SSUK previously announced a restructuring in November 2024 and had a winding up petition adjourned in the same month. In May this year, another hearing was adjourned amid a potential sale. The company employs around 1,450 people within the speciality business.
Kabel adds that the plan Liberty’s parent, GFG Alliance, presented to the court “would have secured new investment in the UK steel industry, protecting jobs and establishing a sustainable operational platform under a new governance structure with independent oversight.”
“Instead, liquidation will now impose prolonged uncertainty and significant costs on UK taxpayers for settlements and related expenses, despite the availability of a commercial solution,” he says.
Liberty says it has pursued all options to make SSUK viable, including efficiency improvements, reorganisations and customer support. There have been several attempts to find a buyer for the business and intensive negotiations with creditors to restructure debt liabilities. The company notes that its shareholder has invested nearly £200 million ($268m).
The company says it will now continue to advance its bid for the business in collaboration with prospective debt and equity partners and will present its plan to the official receiver.
“GFG continues to believe it has the ideas, management expertise and commitment to lead SSUK into the future and attract major investment. GFG’s other significant business interests in the UK remain unaffected,” it adds.
In a separate statement, industry association UK Steel says the company provides vital steelmaking capacity in aerospace, defence and power generation. The association welcomes the government’s move.
UK Steel director general Gareth Stace says: “UK Steel welcomes the government’s recognition of the importance of the Liberty Speciality Steel assets and hopes that a new owner is found quickly and can inject the investment and working capital required to return production volumes to previous levels.”
“The assets produce high quality, specialist steels that serve high value markets. The low production levels of recent years have left significant holes in the domestic supply chain that have been filled by imports. We hope to see these holes quickly filled by UK-made steel,” he adds.
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UK Infrastructure Strategy to support domestic steel sector
The UK government’s new Infrastructure Strategy has been welcomed as supportive for the domestic steel sector, Kallanish observes.
Industry association UK Steel welcomed the move noting the developments worth “billions of pounds,” would bring opportunity for steelmakers. However, it noted that a competitive environment remains vital.
It highlighted that millions of tonnes of steel will be needed for the Infrastructure Strategy investments in new nuclear capacity, regional transport, schools and prisons, announced by the Government. The association also highlighted Chancellor, Rachel Reeves, saying in her recent Spending Review speech that these projects should be made using UK-made steel.
It added that the announcement offers businesses clarity over the Government’s long term public procurement plans and how steel companies can support these ambitions and grow their own production. However, it noted that ongoing market confidence for steel companies will be cemented with truly competitive electricity prices, strategic domestic public procurement and reinforced trade defences.
UK Steel director-general, Gareth Stace, said: “Where public money is involved, British contracts should buy from British steel firms, boosting thousands of jobs and supply chains across the United Kingdom. The Infrastructure Strategy and forthcoming pipeline means the steel industry can take full advantage of these opportunities.”
“UK steelmakers are holding up their end of the bargain, working closely with the Government on reforms to the Policy Procurement Note for Steel and a digital steel catalogue to ensure procurement teams know what steel we make and where,” he added.
“To secure the success of our steel companies and the Government’s ambitions, the infrastructure plans must go hand-in-hand with competitive electricity prices, strategic domestic procurement and a new trade defence mechanism in 2026 to handle the influx of imported, high-emission steel,” he concluded.
Meanwhile, the British Constructional Steelwork Association also welcomed the strategy and said it was a “strong signal of intent to deliver not only infrastructure, but also industrial resilience and regional growth.”
It praised the commitment to reform public infrastructure procurement, which it said valued whole-life performance over lowest upfront price. As well as clearer, longer-term project pipelines that support investment in UK-based fabrication capacity and skills.
It also welcomed the shift towards prioritising domestic supply chains to support sustainability, employment, and strategic national capabilities.
“The constructional steelwork sector is ready to build the infrastructure of the future – greener, safer, and made right here in the UK. Let’s seize this opportunity to turn strategy into delivery,” it added.
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Countries should tackle overcapacity with US: UK Steel
Industry association UK Steel says its home country should work with the US to tackle overproduction, despite the UK not being granted an exemption from the latest additional 25% US tariffs on steel imports.
In a statement seen by Kallanish, UK Steel says the newly announced tariffs cancel out previous quota arrangements and exemptions. Product-specific exemptions for steel not made in the US have also been scrapped. Tariffs now extend to derivative products, with only steel “melted and poured” in the US but processed elsewhere remaining exempt.
The new rules take effect on 12 March.
UK Steel notes Trump has cited rising global excess capacity, which is forecast to hit 630 million tonnes in 2026, and concerns over steel transhipment from China. These blanket measures aim to block such routes.
The association however rejects Trump’s claims that US imports from the UK rose, along with other countries, rendering quotas ineffective, noting UK steel exports to the US were actually 14% lower in 2024 than in 2018 when tariffs were first introduced.
The UK exported 300,000 tonnes/year of steel to the US in 2017 before the 2018 Section 232 tariffs. Exports averaged 200,000 t/y over 2018-2021. The UK and the US agreed a system of tariff-rate quotas in 2022 with exports recovering to 235,000t. In 2023, exports to the US dipped to 165,000t, UK Steel notes.
Trump has criticised trading partners for not tackling non-market excess capacity, mainly from China, and lacking cooperation on trade remedies and steel monitoring. UK Steel says this could open the door for negotiations, with reports suggesting Australia may already be in line for an exemption.
UK Steel director general Gareth Stace says: “UK steel poses no threat to US national security. Our high-quality products serve key US industries, many of which cannot source these domestically. This is a moment where our countries should work together to tackle global steel overproduction, not to be at loggerheads. The UK stands with the US on tackling global excess steel capacity and unfair trade, and our industry urges the UK Government to take stronger action on these issues.”
“President Trump has taken a sledgehammer to free trade with huge ramifications for the steel sector in the UK and across the world. This will not only hinder UK exports to the US, but it will also have hugely distortive effects on international trade flows, adding further import pressure to our own market,” Stace concludes.
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UK government launches industry-backed steel council
The UK government has launched a steel council as part of its new strategy to support the struggling sector, Kallanish learns.
The council will be led by business secretary Jonathan Reynolds and chair of the Materials Processing Institute Jon Bolton. Its members include steel producers British Steel, Tata Steel, Liberty Steel, Celsa Steel and Marcegaglia. Also on board are the British Metals Recycling Association, and trade unions Community and GMB, in addition to other industry experts and ministers from the devolved nations.
The government says this demonstrates its partnership with the sector to revitalise UK steelmaking and secure economic growth.
The steel council will advise on the upcoming steel strategy, enable collaboration across the sector and its supply chains, and identify how to distribute the £2.5 billion ($3.13 billion) National Wealth Fund.
Jonathan Reynolds says: “The industry and steel communities have had enough of lurching from crisis to crisis – this government will take the action needed to place steel on a secure footing for the long term. Steel was a neglected industry in this country under the previous government.”
“A vibrant steel sector is crucial for economic growth and our national security, and by reflecting views from industry across the UK as we bring forward our Steel Strategy we’re delivering on the Plan for Change and boosting economic stability,” he adds.
Industry association UK Steel, which is also a member of the council, welcomed the move saying that “hope is on the horizon”. The steel strategy will serve as the blueprint for a revitalised and competitive steel industry in the UK, it adds.
It notes this requires competitive electricity prices, bold trade policies, addressing global overcapacity and strategic public procurement policies. Also needed is a robust CBAM, new policies on scrap and raw materials and investment in innovation.
Gareth Stace, director general of UK Steel, says: “The establishment of the steel council marks a defining moment for the future of steelmaking in Britain. The council represents a crucial step towards creating a comprehensive government steel strategy – one that lays the foundations for a sustainable and resilient industry.”
“This strategy is a once-in-a-generation opportunity to foster a competitive business environment that encourages long-term investment and ensures steelmaking remains at the heart of the UK economy,” he adds.
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UK Steel calls for additional protection from overcapacity
Industry association UK Steel is warning the domestic market could be exposed to excess capacity if existing safeguards were to lapse, Kallanish notes.
The Steel Trade Beyond 2026 report says that excess steel capacity worldwide, built due to non-market forces such as state subsidies, could cancel out UK investments if not tackled with new trade policies. Global steel excess capacity in 2023 was estimated at 543 million tonnes.
Steel demand in China is also weakening, and the country is expected to export 100mt this year, causing supply to spill over into other markets and dampen steel prices.
The average profitability of the steel sector is currently the lowest in a decade, according to the report, with producers in developed economies losing market share to underpriced imports.
The import share in the UK has jumped to 68% so far in 2024, from 60% in 2023 and 55% in 2022, with just 40% of the UK’s yearly demand requirements being fulfilled by domestic supply.
The association notes that while the UK government is investing seriously in building the UK steel industry, addressing excess capacity and fair competition should be a fundamental element of the upcoming Steel Strategy.
UK Steel director general Gareth Stace says: “A raft of distortive subsidies is leading to oversupply which is met with rising protectionism and trade diversion.”
The report adds that safeguards which have been shielding the UK sector from trade diversion, will have to expire in 2026 due to WTO rules, and action must be taken urgently ahead of existing protection lapsing in 21 months’ time.
There are fears that growing trade protectionism by other countries could result in trade flows being directed at markets left exposed, with the UK government now needing to go further than it has before. The US continues to add additional tariffs on Chinese imports, as has Canada.
It recommends the government explores trade policy options, including ones that make use of WTO exceptions, in the context of actions taken by other WTO members which could include tariff-rate quotas.
Additionally, it should seek to play an active role in international initiatives such as the Global Arrangement on Sustainable Steel and Aluminium currently being negotiated between the US and EU.
Other recommendations include reviewing the UK trade remedies framework to make it more accessible to industry, and strengthen carbon leakage and public procurement policies to counter the impact of excess capacity on UK producer market share.
Stace adds that excess capacity has the potential to redraw the map of global steelmaking as there is no longer fair competition.
The report also notes that capacity growth in Southeast Asia and the Middle East has been largely state-funded and for high-emission blast furnaces. Over two thirds of the steelmaking capacity is in countries that have net zero targets later than 2060 or none at all.
Carbon-intensive blast furnaces account for more than 74% of capacity additions in Asia, while 89% of blast furnace energy input globally comes from coal.
“Failing to tackle the issue head-on could see British steelmakers continue to lose market share and mean that investments in decarbonisation are all for naught. So far, steel safeguards have offered a necessary shield but their expiry in 2026 could see industry faced with a cliff edge,” Stace concludes.
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