Around the world, countries are seeking to build greener, more circular economies. Steel is central to that ambition. It is still one of the most widely used materials – but producing it is one of the largest industrial sources of carbon emissions worldwide.

The UK domestic steel industry is the smallest it has been since the 1930s. Production fell to 4 million tonnes in 2024 and 70% of the country’s steel is imported. Despite this, the government’s new steel strategy is hugely important for the country’s future prosperity.

The UK is decisively moving from blast furnaces to electric arc furnaces (EAF), producing “circular steel” from scrap. On the face of it, the plan is compelling. It should align with UK strategies for its economy, national security and progress towards net zero.

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The strategy requires the state to take an active role – buying more domestic steel, reducing import quotas and subsidising the UK’s high electricity costs. Perhaps above all, it rests on the assumption that scrap steel, most of which is exported, can be redirected to feed this new generation of EAFs.

Making this shift will........

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