Steelmakers warn of a looming crisis in Britain
LONDON (Reuters) – A British steel industry lobby warned on Monday of an impending crisis due to soaring wholesale energy prices that could force costly factory closures, fuel emissions and sow chaos in supply chains.
The shortage of natural gas in Europe has driven up electricity and gas prices, driving up the prices paid by people who heat their homes or major steel smelting plants.
“These extraordinary electricity prices result in lower or lost profits and therefore less reinvestment,” UK Steel, which lobbies on behalf of the British steel industry, said in a media document.
“As winter approaches, demand for gas and electricity will rise, and prices may rise, which will make it impossible to produce steel profitably.”
As the West deals with massive ostentation by governments during COVID-19 lockdowns, investors are increasingly concerned that sharp price increases will hit the world’s largest economies, making money more expensive, turning companies red and eroding wages. .
UK Steel said some plants may have to shut down production for “increasingly long periods with consequences not only for individual companies but also for UK steel supplies to the UK economy and UK jobs.”
It added that abrupt shutdowns could damage equipment, increase costs and eventually lead to “weaker environmental performance with higher emissions.”
UK Steel has called on the government to help.
She said Britain could provide a fixed amount of capacity at a competitive price or a virtual interconnect adapter.
Unless the government helps, she said, “the consequences for our industry will be dire.”
On Sunday, Business Minister Kwasi Quarting said the government is working on how to support energy-intensive industries that have been hit by rising gas prices, saying that this is a “critical situation”. Read more
(Reporting by Guy Faulconbridge). Editing by Kate Holton and Michael Holden
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