UK steel mills adjust production amid lower demand due to coronavirus pandemic

UK steel producers have adjusted their output on softer demand, but overall they are still producing despite the COVID-19 outbreak and some restrictions put in place by the government, company officials confirmed to S&P Global Platts on Tuesday.

Among the major UK steel players, Tata Steel, British Steel and Liberty Steel have made some cuts in production, but mainly in areas linked with the automotive sector to adjust to the drop in demand from clients, the companies confirmed to Platts.

In Europe, carmakers and major construction firms are shutting factories and work sites as the COVID-19 pandemic causes disruption to supplies, staff shortages and collapsing demand.

A Tata Steel spokesperson said, “As you will know overall, European steel demand is lower than normal. A number of steel-using manufacturers have paused production, including European car manufacturers.”

“We have therefore reduced production at some of our European mills to match this lower demand. We will continue to operate all four blast furnaces across our two steelmaking hubs — in IJmuiden, the Netherlands, and Port Talbot, Wales. However, liquid steel production will be reduced as a consequence of the sudden drop in demand,” the spokesperson added.

At Port Talbot, Tata Steel has a capacity of 3.5 million mt of crude steel a year. The company did not say how much production has been cut so far.

Also, the second largest UK steel producer, British Steel, confirmed that its two blast furnaces continue to operate. British Steel produces around 2.5 million mt of crude steel a year.

Meanwhile, according to a Liberty statement sent to Platts, the company has decided to suspend its operations only at Liberty Pressing Solutions, Liberty Tube Components and Liberty Aluminium Technologies, which are factories linked with the car industry.

The company decided to suspend production at the beginning of this week, but work will nevertheless continue for the rest of this week on completing customer schedules and ensuring plant and equipment is shut down in a manner that enables an efficient restart when required.

In the UK, Liberty has 1.2 million mt of crude steel capacity from two furnaces in Rotherham.

UK producers in total make about 7.3 million mt of steel a year, around 65% of the UK’s annual requirement. The industry employs 32,600 people directly in the UK and supports a further 41,100 in supply chains.

— Annalisa Villa