“The finest steel goes through the hottest fires. It feels no pain, no pity, no remorse, but stays sharp and ready.”
After the last few weeks of tariffs, Trump and tech tribulations – time for some light but deeply unfunny comic relief…. The UK’s steel crisis. Over the weekend the Houses of Parliament met on a Saturday for the first time since 1982, to debate the effective re-nationalisation of the steel industry – a very late effort to at least pretend it’s plugging yet another gaping hole in the UK’s strategic resilience and ailing national infrastructure.
The gist of the story sounds like something out a 1950’s Ealing Comedy or a bad West End farce: In order to boost the UK’s ailing steel industry, it is privatised by Maggie Thatcher and eventually (after multiple busts) sold to a Chinese firm, Jingye, which decides the best way to make a return on its investment, (while simultaneously serving Emperor Xi by discombobulating the UK economy), is to close the last blast furnaces in Britain down, and sell the UK Chinese steel instead.
It gets funnier:
As part of its plan, the villainous Chinese firm sells it’s orders for the coking coal necessary for the production of high-grade steels to other buyers, meaning the blast furnaces will run out of fuel and crack as they cool down, ensuring they join the rest of UK national infrastructure on the broken, waiting-to-be-fixed won’t happen.
The government wakes up to the reality coking coal to make steel is a scarce commodity, meaning it’s scrabbling round trying to access any. Hmm… the Chinese might sell them some. Instead, there is vague talk the Royal Navy will be dispatched to secure some – as soon as they fix-up one of their port-loving jollyboats and find some crew to man it.
The Leftie-Tree-Hugger in chief on the Labour government’s front bench, Ed (or is it Dave) Miliband – Minister for Energy Security was telling us we don’t need nasty, polluting blast furnaces, or coking coal, but that new (terribly, terribly expensive) electric arc steel production is much cleaner. He glosses over the reality the tech requires very expensive scrap steel to operate and can’t produce key specialist steels. It is simply marvellous for making hi-end baconfoil though.
In the wake of Trump making Ukraine “an offer it can’t refuse”, and the Russian/Chinese threat, the UK and Europe wake up to the reality they are pretty much defenceless against disreputables from both the East and West, and need to embark on a policy of rearmament, meaning the UK needs lots of high grade specialist steels for ships, planes, missiles, guns and tanks.. and in the absence of local blast furnaces, the only place where they will be able to buy weapons grade steel is from… China…
China can’t wait… and they want to sell the UK lots of iron railroad track to complete our national rail system and other stuff.
(This has happened before. In 1938, shortly after the Munich peace agreement, the Royal Navy ordered new battleships, only to discover the only place they could source the required armour plating was Czechoslovakia, which had just been signed over to Germany as part of Neville Chamberlin’s Trump-style deal.. Doh!)
Quote of the day goes to Liam Byrne, chair of the business and trade committee, who gets a NSS award for observing:
“At the heart of this debate is a very simple question: can we entrust a critical national asset to a company we do not trust?”
That’s a question the UK should be asking a lot these days on the basis most of the nation’s industry and infrastructure has been bought and asset stripped by American and other foreign firms. It isn’t just bad actors from China, or India that have wrecked the UK.
There is a reason the UK’s energy costs to business and consumers are about double anywhere else in Europe. The UK’s planning system has become a parasite sucking the life out of the economy.
I recently lost days at a planning appeal inquiry where a cement company is demanding it is given approval to literally dig the heart out of our village for sand and gravel. The quarry will create seven jobs. No one disputes it presents severe risks to the $220mm local marine economy and the 2000 jobs it creates! On an economic basis the quarry makes zero sense. It is only happening because an old law says every county must have a strategic plan for minerals and waste – which includes gravel. We don’t actually need any gravel – there is 12 years of it sitting in council stockpiles, and recycled building materials have largely replaced it.
The cement company wants to quarry it because they know the value of the hole in the ground is not the gravel they take out, but the nasty, toxic, water-polluting landfill they will stuff back into it! No concern of theirs if that ultimately costs thousands of local jobs, the value of residents’ homes, or the health of schoolkids at the three local schools immediately adjacent to the site.
As I watched the inquiry move at the glacial speed the protocol of these things demand, I realised it served nobody but wealthy litigants, and to provide employment to planners, bureaucrats and officials. We reckon the KC employed by the cement firm was on £7-10 k a day! For residents – we the voters – it might as well have been conducted in Latin for all credence given to our thoughts. Then we discovered Hampshire County Council planners – with no reference to elected leaders – had decided not to oppose the application, largely because they fear the Cement firm will sue them for costs when they win – which they probably will because they have money to wear down residents!
Meanwhile, far away in the North of England…
Up in Whitehaven, a small, depressed town in Cumbria, some brilliant, but unemployed mining engineers, sigh into their beers. They saw the British Steel crisis coming.
For years they’ve been ready to dig the UK’s first new coal mine in decades – West Cumbria Mining’s new Woodhouse Colliery. They saw the need for the UK to have strategic access to coking coal and we set to mine the finest metallurgical grade coal from under the Irish Sea for UK and European foundries. The mine would create hundreds of well-paid local jobs and use existing transport infrastructure to limit costs and environmental damage – it would be carbon neutral.
But it was coal. Greta Thunberg didn’t like it.
The Conservative Government dithered, and the project took years to progress through the UK’s utterly hatstand planning process – a process which makes sclerotic sound impossibly speedy. Months were spent debating every aspect of the plan and how it might affect rare, yellow-crested newts living miles away. (Ok, there are probably no such things as yellow-crested newts – they are metaphorical newts.)
Everyone in the mining industry agreed it was a great plan. Everyone in the steel industry said it was brilliant. Everyone in the town of Whitehaven, where the mine would be dug, supported it – looking forwards to jobs, multiplier effects and prosperity. But the politicians and planners were worried about what the yellow-crested newts might think, and City Financiers (having a clear understanding of yield curves and hedging, but little practical knowledge of the mechanics or chemistry of steelmaking) were concerned that upset yellow-crested newts might upset the green lobby and lead retail investors to blame them for global warming. I knew all this because I was trying to find the financing for West Cumbria Mining – I wrote about it in the Porridge many times.
Even though the mine was bounced around the Glasgow COP conference, in 2022 Secretary of State Michael Gove finally approved the mine. It would produce 2.7 million tonnes of top metallurgical coal for Europe rather than ship it from China or Australia. But then it stalled as Friends of the Earth appealed. They told Whitehaven residents to focus on Green-jobs instead.
Following the election, Ed Miliband made clear his opposition, withdrew Government support, and the project was effectively quashed. There is lots of conflicting noise from the newt-worriers, Indian and Chinese steel firms saying they didn’t want the coke (because they’d prefer to close the sites), and politicians spouting ill-informed nonsense… The result is West Cumbria mining has been forced to withdraw the planning application for the site. Local residents are still waiting for any sign of any new green jobs. Yellow-crested newts are frankly indifferent.
Burning coal to make steel creates emissions. Fact. But, if we ain’t making speciality steels in the UK, then rearmament plans aren’t achievable, and the nation is made vulnerable. Everything in life is a trade-off. The one thing we can agree on is the UK’s not-fit-for-purpose planning rules will achieve is a sub-optimal solution.
Out of time, and back to the day-job…
This article was originally published in Blain’s Morning Porridge
