Redcar Steel plant

[Scuffers]

here we have the latest casualty of the climate change act.

http://www.bbc.co.uk/news/uk-england-tees-34387927

even the Guardian are saying it's energy costs killing it.

http://www.theguardian.com/business/2015/jul/16/ta...

how much longer can this crap go on for?

[Blib]

Unfortunately, not until the idiotic politicians and the rabid NGOs decide that they have saved the planet.

[Digga]

Sheer stupidity.

All this Northern Powerhouse claptrap from the govt and yet they've sleepwalked into this. Given we're supposed to be globally competitive, I can't really see why we stick to the rules whilst importing stuff half way round the planet from countries who seem to care very little about pollution.

[Scuffers]

but apparently we can spend some £6Bn on more climate change crap in Africa etc?

http://www.express.co.uk/news/politics/608518/fore...

[Crush]

We'll lose even more industry once all companies have to pay for carbon credits

That should be coming in soon for smaller businesses? Where it is necessary to buy a carbon allowance and be fined if you go over it, and fined if you don't reduce energy use the following year

[anonymous-user]

Having worked in Asia for half my life I can tell you the last thing you want is to compete with India and China. the whole idea as spouted by Blair is rubbish there is no way you can compete. Obviously European labour cost is higher as is employment cost in general, but I don't think that's the issue, efficiency in Europe counters much of this. HSE legislation Environmental, pollution, waste disposal, planning restrictions etc or the lack of it gives a huge advantage, fair competition with USA Germany is one thing, but if you want jobs for your kids you need to stop this idea of competing with Asia and close the door. I have property in the UK, Norway, Malaysia and Indonesia, my views don't come from the Daily Mail, in Indonesia we are close to ship yards, there is no way Europe can compete. The Japanese, Americans and Koreans don't try to compete with China they just close the door.

[Scuffers]

Berw said:

Having worked in Asia for half my life I can tell you the last thing you want is to compete with India and China. the whole idea as spouted by Blair is rubbish there is no way you can compete. Obviously European labour cost is higher as is employment cost in general, but I don't think that's the issue, efficiency in Europe counters much of this. HSE legislation Environmental, pollution, waste disposal, planning restrictions etc or the lack of it gives a huge advantage, fair competition with USA Germany is one thing, but if you want jobs for your kids you need to stop this idea of competing with Asia and close the door. I have property in the UK, Norway, Malaysia and Indonesia, my views don't come from the Daily Mail, in Indonesia we are close to ship yards, there is no way Europe can compete. The Japanese, Americans and Koreans don't try to compete with China they just close the door.

to a point, you are right.

it really depends what the subject is though, steel is a hard one, as the costs are predominantly energy and transport, not so much labour.

this becomes more apparent the higher up the steel grades you go, just try buying specialist steels these days ...

[Digga]

Berw said:

The Japanese, Americans and Koreans don't try to compete with China they just close the door.

For clarity, do you propose the UK close the door altogether, or clobber them with tariffs for failing to meet our environmental and employment standards?

[RobGT81]

All part of the plan for CMDs northern powerhouse.

[FiF]

Scuffers said:

Berw said:

Having worked in Asia for half my life I can tell you the last thing you want is to compete with India and China. the whole idea as spouted by Blair is rubbish there is no way you can compete. Obviously European labour cost is higher as is employment cost in general, but I don't think that's the issue, efficiency in Europe counters much of this. HSE legislation Environmental, pollution, waste disposal, planning restrictions etc or the lack of it gives a huge advantage, fair competition with USA Germany is one thing, but if you want jobs for your kids you need to stop this idea of competing with Asia and close the door. I have property in the UK, Norway, Malaysia and Indonesia, my views don't come from the Daily Mail, in Indonesia we are close to ship yards, there is no way Europe can compete. The Japanese, Americans and Koreans don't try to compete with China they just close the door.

to a point, you are right.

it really depends what the subject is though, steel is a hard one, as the costs are predominantly energy and transport, not so much labour.

this becomes more apparent the higher up the steel grades you go, just try buying specialist steels these days ...

That's before you get into China ignoring intellectual property rights, trademarks and anything else and making shoddy goods labelled with the trademark and the US number when they haven't the knowledge and technology on how to do it. At least until they send industrial spies into the factory.

Source, personal experience , anecdotal admittedly but absolutely true. Fortunately we sussed the spy before too late.

[bazza white]

Turkey is another issue for steel supply in Europe or our exports.China isn't a huge supply problem it is a scrap demand problem. Over supply here in the UK and a demand for scrap from China is an issue. With a lower demand in China for scrap you would expect prices to drop but it didn't as much as it should. Conversion rates also remain unchanged, I believe ours is about £125/t from billet to prime. A plant in Italy is £250 and it makes money, all producers know they are getting backhanders from the goverment.

There are several factors that need working. Green tarriftarrifs lowering, duty on scrap exports would help, energy prices.

The wage bill is a small % of steel production but is one of the few outgoings that can be changes so always gets hit first.

A few plants need to die off though to save the rest.

[Digga]

bazza white said:

A plant in Italy is £250 and it makes money, all producers know they are getting backhanders from the goverment.

My hunch, for decades, has been that vast swathes of their engineering industry benefit likewise.

[FiF]

Digga said:

bazza white said:

A plant in Italy is £250 and it makes money, all producers know they are getting backhanders from the goverment.

My hunch, for decades, has been that vast swathes of their engineering industry benefit likewise.

Well there was a Spanish plant that got subsidy by way of uncommercial interest rates it received on loans from state funds. The EU however, ruled that another form of state aid the waiver of the Spanish Social Security Fund's rights as a preferential creditor for the equivalent of £6 million and the cancellation of mortgages on land, to assist the company's rescue from bankruptcy, was not illegal.

[crankedup]

Collapse in steel orders, high energy costs. Who the heck would want to buy into that! Exactly go bust.

[Scuffers]

crankedup said:

Collapse in steel orders, high energy costs. Who the heck would want to buy into that! Exactly go bust.

very short sighted view...

look what happened the last time we shut most of what was british steel down...

[crankedup]

Scuffers said:

crankedup said:

Collapse in steel orders, high energy costs. Who the heck would want to buy into that! Exactly go bust.

very short sighted view...

look what happened the last time we shut most of what was british steel down...

Nobody can be more keen than I to see our industries grow and thrive, the sad truth is that in this situation the owners simply cannot continue to pour in millions of loss pounds. Its hard economic facts in a Global market, if it was owned by Government maybe they would keep the place open, but very unlikely.
I hope that our Government can offer more support to the working people affected by the closure than was offered when the coal mines were closed!

[Scuffers]

crankedup said:

Nobody can be more keen than I to see our industries grow and thrive, the sad truth is that in this situation the owners simply cannot continue to pour in millions of loss pounds. Its hard economic facts in a Global market, if it was owned by Government maybe they would keep the place open, but very unlikely.
I hope that our Government can offer more support to the working people affected by the closure than was offered when the coal mines were closed!

don't disagree,

the problem is when it's a rigged market, with countries dumping into the markets until their competition goes under.

at the moment it's China, it was India last time.

[crankedup]

Indeed, it has been said many times by many people, we cannot compete on price alone but our quality is second to none. Some of the stuff that comes out of China is more ste than steel imo.

[shirt]

bazza white said:

A few plants need to die off though to save the rest.

there's only 3 primary steelmaking plants in the uk - redcar, shorpe and port talbot.

tata at scunny moved from 2 to 3 blast furnaces earlier this year. previously [this is going back some years] they had a take off agreement for slab from redcar when it was taken over by ssi. clearly the economics of steelmaking are still there, just not with feedstock from a third party supplier.

[legzr1]

crankedup said:

Nobody can be more keen than I to see our industries grow and thrive, the sad truth is that in this situation the owners simply cannot continue to pour in millions of loss pounds. Its hard economic facts in a Global market, if it was owned by Government maybe they would keep the place open, but very unlikely.
I hope that our Government can offer more support to the working people affected by the closure than was offered when the coal mines were closed!

It can be done and done well.

Consett was a large 'steel town' devastated by closure but time, investment and intelligent thinking helped greatly.

Same thing with Alcan more recently with the closure of the smelter plant - not on the scale of Redcar but still a small northern town reliant on a sole employer that went to the wall.