SSI suspends steelmaking at Redcar plant amid cash crisis

Production at South Bank coke ovens has been stopped and that plant mothballed amid a cashflow crisis. The rest of the former British Steel site, including the blast furnace remains, operational.

GALLERY: The highs and lows of iron and steelmaking on Teesside

Consultation has begun with the 150 coke workers and there are fears for the future of the rest of SSI Redcar which employs 2,000 plant workers as well as about 1,000 contractors.  

Redcar blast furnace today as work continued in parts of the plant. Picture: TOM BANKS

Redcar MP Anna Turley, who led yesterday's emergency Commons debate on the steel crisis, said: "My thoughts are with the workers and their families. They have put their hearts and souls into this. We are doing all we can to help get things back up and running."

At about 11am today staff at the plant were called to a meeting where they were read a statement. It said: "SSI UK announce that iron and steelmaking operations at their plant at Teesside will be paused due to ongoing issues with the supply of raw materials and services. Preparations are being made to systematically reduce the production during the course of today, with a view to retaining the plant in a condition whereby it can be brought back into production at an appropriate point.

"Redcar Coke Ovens and the Power Station will continue to operate at a reduced level. Production at South Bank Coke Ovens will cease and the plant mothballed.

Cornelius Louwrens, UK Business Director and Chief Operating Officer said: "It is with great regret that we have had to make this announcement and we are deeply aware of the concern it will give to our employees and their families.

"The problems within the global steel industry have been well publicised in recent weeks and our decision follows a major deterioration in steel prices affecting our business during the course of this year. Our parent company and other stakeholders have given great support to the business, and the decision to pause our iron and steel production has been taken reluctantly and in a scenario where no other practical options are available at present.

Reacting to the announcement, Roy Rickhuss, general secretary of the Community union, which represents the majority of workers and contractors at SSI UK, said: "This is devastating news.

"Our first thoughts are with the workers who will be affected by today's announcement.

A worker at Redcar blast furnace today after the announcement that steel production would be halted. Picture: TOM BANKS

"We will be seeking urgent talks with SSI management to find out the full extent of the impact this will have on both SSI employees and contractors.

"In the coming days we will do all we can to support our members.

"Only yesterday, following the parliamentary debate on the steel industry, we said that the time for delay is over and immediate government action is needed to support the industry.

"The Government must ensure SSI receives every assistance to preserve the integrity of these vital industrial assets and to resume production at the earliest opportunity."

Paul Warren, the chairman of the multi unions at the works, said the speed of the announcement came as a shock and the majority of staff still have no idea what the future holds.

Speaking outside Steel House today, he said: “We only found out this morning what was happening today but we need to know if there is a long term plan and what it is.

“When the 150 workers from the coke works were told it was closing down everyone was so shocked you could have heard a pin drop but that still leaves hundreds of people who don’t know what the future holds. Someone has to come out and tell us what is going to happen in the future.

“I would estimate that around 50 per cent of the workforce went through this last time and it was horrendous for them then and to have to go through it again is just unimaginable.”