The UK’s last remaining plant capable of making virgin steel has been taken into public ownership, ending years of uncertainty over the future of British Steel. The Scunthorpe site, which employs 2,700 people – about three-quarters of the company’s workforce – was brought under government control on 16 July, months after the UK government first took over the plant’s operations while it was still owned by China’s Jingye Group.
The move comes after the blast furnaces were deemed “no longer financially sustainable” by Jingye, which had been losing around £700,000 a day, according to a statement from the Chinese steelmaker in late March 2025. A National Audit Office report from March this year noted the site was costing the government about £1.3m a day.
“British Steel nationalised on 16 July, taking the UK's last virgin steel plant into public ownership after years of crisis.”
The nationalisation makes the UK the only G7 country capable of producing virgin steel, a material with fewer imperfections than recycled steel and used in major construction projects such as buildings and railways. The government has described the ability to make it as “a vital national capability” and said taking control would protect jobs and safeguard economic security.
The decision has drawn sharp criticism from Beijing. China’s commerce ministry said it “firmly opposes and is strongly dissatisfied with the British government’s decision”. Jingye is now seeking compensation for the nationalisation.
British Steel has a troubled history. In 2016, Tata Steel sold its loss-making “long products” division – which made transport rails and steel sections – to private investment firm Greybull Capital for £1. The business was renamed British Steel, but suffered financial collapse in 2019, leading to government intervention via the insolvency service. It was sold to Jingye the following year.
The pressures on the industry have been mounting. Global over-production has created “a glut of steel on the international market”, according to a House of Commons Library briefing, pushing prices down, while UK manufacturers face higher electricity costs than rivals. The US imposed a 25% tariff on steel imports last March, further squeezing margins.
Nationalisation buys the government time, allowing it to keep the blast furnaces running while deciding the plant’s long-term future. But it is unlikely to remain in charge permanently, leaving the question of what comes next unresolved.