Liberty Steel has started consultations with unions over the mothballing of its merchant bar mill in Scunthorpe amid a lack of local feedstock supply that has affected the plant's viability, the steelmaker says.

“Over the past two years, LIBERTY's parent company, GFG Alliance, has explored all possible ways to establish a sustainable business for LMB [Liberty Merchant Bar]. Despite providing significant financial support and maintaining the plant's safe, compliant facilities, the commoditised products produced by LMB face stiff competition from imports with lower energy costs and less stringent environmental standards,” a Liberty spokesperson tells Kallanish.

The loss of gas supply to LMB's reheat furnaces due to the closure of coke ovens at the same site has further impacted the plant's viability.

Approximately 127 employees associated with the plant will be part of the consultation process, which will last at least 45 days. Liberty says it aims to redeploy staff where possible to minimise the impact on the workforce.

“Over the last two years LIBERTY has restructured and refocused its UK operations so they can operate viably and we have explored every option to achieve the same at LIBERTY Merchant Bar. A range of external factors have prevented this, including the high energy costs all UK steel producers face, and the loss of third party gas supply to our furnaces,” says Liberty Steel chief transformation officer Jeffrey Kabel.

Liberty decided in early 2023 to reduce primary production at Rotherham and replace this with imported billet and slab to feed its rolling mills in, among other locations, Scunthorpe (see Kallanish passim). In early 2022, it injected shareholder capital into its merchant bar operations, following the restart in autumn 2021 of the Rotherham EAF after its own cash injection.

In March, Liberty said its restructuring launched in 2023 has improved operational and commercial viability, enabling the development of a comprehensive plan that aims to take the Rotherham EAF melting capacity to 2 million tonnes/year.