🇬🇧 UK Steel Crisis Deepens: Liberty Steel Halts Production at Key Plants Since July 2024
The challenges facing the UK steel industry have intensified, with Liberty Steel halting production at two of its critical facilities — Rotherham in South Yorkshire and Motherwell in Scotland — since July 2024. This prolonged shutdown highlights the financial turmoil within Britain’s third-largest steelmaker, which is battling to stay afloat amidst mounting debts and stalled restructuring plans.
🏭 Who Is Liberty Steel?
Liberty Steel Group is part of the GFG Alliance, a global group of businesses owned by British-Indian industrialist Sanjeev Gupta. The company was once hailed as a bold new force in sustainable steel production, with a vision to transform the industry using electric arc furnaces (EAFs) and green technologies.
With operations across the UK, Australia, Europe, and the United States, Liberty Steel aimed to be a leader in the production of low-carbon steel. But its rapid, debt-fuelled expansion has now left it exposed. The 2021 collapse of its key financier, Greensill Capital, sent shockwaves across its global operations, triggering investigations by the UK Serious Fraud Office and leaving billions of pounds in unpaid debts.
🔻 Crisis at the Core: UK Production Stalls
Despite having the UK’s largest electric arc furnace in Rotherham, Liberty Steel has produced nothing at Rotherham or Dalzell for nearly a year due to a lack of working capital to buy raw materials. Workers have been placed on 85% furlough pay, and the plants have been in a holding pattern, awaiting rescue funding or new investors.
The situation is particularly troubling given the strategic importance of these facilities:
- SSUK (Speciality Steel UK) in Rotherham and Stocksbridge supplies Rolls-Royce, Airbus, and other major aerospace and defense clients.
- Dalzell, in Motherwell, produces steel plate crucial to the UK’s defense supply chain — including for Royal Navy warships.
In total, 1,450 jobs are at risk if no solution is found. Liberty is reportedly seeking a sale of its South Yorkshire assets to avoid liquidation, while its restructuring plans have faced stiff opposition from creditors, including Greensill’s administrators.
⚠️ Industry-Wide Implications
This collapse is not an isolated issue. The broader UK steel sector is under severe pressure:
- UK steel production in 2024 dropped to its lowest level since the 1930s.
- The government was recently forced to step in to take control of British Steel’s blast furnaces in Scunthorpe amid fears of 2,700 job losses.
- Many UK sites now rely on pre-paid customer orders just to fund raw material purchases.
The Liberty Steel crisis has raised serious concerns about the future of domestic steel supply chains, especially in sectors like defense, aerospace, and infrastructure. The lack of production also threatens the UK’s ability to scale up green steel efforts, which are critical for meeting climate targets.
Financial Woes and Industry Impact
The Rotherham and Motherwell plants have not produced any steel in nearly nine months due to insufficient funds to purchase essential raw materials. According to employees, most of the workforce has been on furlough, receiving 85% of their salaries. These developments underscore the wider decline of UK steel manufacturing, which hit its lowest production levels since the 1930s in 2024.
Liberty Steel, part of Sanjeev Gupta’s GFG Alliance, has been grappling with financial instability ever since the collapse of Greensill Capital in 2021, which had extended around $5 billion in credit to the group. Now, Speciality Steel UK (SSUK), the Liberty subsidiary operating Rotherham, owes £619 million, with £289 million owed to Greensill’s administrators.
Despite hopes for restructuring, the failure to reach an agreement with creditors has forced SSUK into urgent talks with potential investors, as it races to avoid liquidation by 16 July 2025. The electric arc furnace (EAF) at Rotherham — a critical asset for recycling scrap steel into parts for aerospace and automotive sectors — has been idled, along with the related Stocksbridge and Dalzell sites.
Calls for Change and Government Reluctance
Trade unions and politicians have expressed deep concern. Alun Davies from the Community union criticized the latest court adjournment as merely “kicking the can down the road,” warning that workers are being left in limbo. He and others, including Labour MPs, have called on Sanjeev Gupta to either reinvest in the business or hand it over to responsible new ownership.
Meanwhile, the UK government remains reluctant to intervene, citing ongoing investigations by the Serious Fraud Office into suspected fraud and money laundering at GFG Alliance. Government officials are wary of any bailout that could be misused to support offshore operations.
A Crossroads for UK Steelmaking
Liberty’s inability to resume production is more than a business issue—it’s a national concern. The Rotherham plant is a strategic supplier to high-profile clients such as Rolls-Royce and Airbus, and the Scottish Dalzell site plays a vital role in supplying the Royal Navy’s warship programme.
If production does not resume soon, critical defence and infrastructure supply chains may need to look elsewhere, further threatening the future of UK-based steelmaking.
Liberty Steel’s Lifeline: Potential Buyer Delays Insolvency — But Is It Enough?
The future of one of the UK’s major steel producers, Liberty Steel, continues to hang in the balance. This week, there’s been a moment of cautious optimism for its subsidiary, Speciality Steel UK (SSUK), as a potential buyer has emerged — temporarily halting insolvency proceedings.
But does this signal a real turnaround, or just another delay in addressing deeper structural issues? As steelworkers, customers, and the industry watch closely, it’s clear that uncertainty still defines the future of UK steel.
🔍 A Brief Recap: What’s Happening?
At a hearing in the UK High Court, lawyers for SSUK — which operates steel plants in Rotherham and Sheffield — confirmed that “urgent meetings” had taken place with a third-party purchaser interested in buying the business.
As a result, a winding-up petition filed against the company was adjourned until 16 July 2025, giving SSUK an eight-week lifeline to secure the sale and avoid insolvency.
This comes after nearly a year of stalled production at SSUK’s facilities due to a lack of working capital, with over 1,450 jobs on the line.
The High Court in London is set to decide whether to force Liberty Steel’s Speciality Steel UK (SSUK) division into insolvency, following winding-up petitions from frustrated creditors like Harsco Metals. These creditors are demanding that the company’s assets be sold to recover unpaid debts.
A creditor told the BBC:
“Of all the owners of this plant we’ve worked with, Liberty Steel is the worst. You don’t know if you’re going to be paid from one day to the next.”
The same source claimed the company owes him tens of thousands of pounds, putting his own employees’ jobs at risk — highlighting the domino effect Liberty’s financial crisis is causing.
💬 What Liberty Steel Is Saying
Jeffrey Kabel, Chief Transformation Officer at Liberty Steel, welcomed the court’s decision and said:
“We remain committed to finding the right solution that preserves electric arc furnace steelmaking in the UK — a vital national asset serving strategic supply chains.”
He noted the firm is continuing intensive discussions to secure a positive outcome while restructuring the business in the wake of Greensill Capital’s 2021 collapse, which left the company financially exposed.
🔍 Background on Liberty Steel and GFG Alliance
Liberty Steel is part of the GFG Alliance, an international group of businesses in steel, aluminium, energy, and trading led by controversial businessman Sanjeev Gupta. GFG grew rapidly through acquisitions but was heavily dependent on financing from Greensill Capital, which collapsed in 2021.
Since then, Liberty has struggled to secure new financing, leaving its UK operations, particularly SSUK, starved of working capital and unable to sustain production.
🚨 A Pattern of Failures
In recent years, Liberty Steel has made several attempts to restructure its UK speciality steel division — all of which have either failed or been delayed.
Workers and unions have had enough.
Roy Rickhuss, general secretary of the Community union, said:
“Enough is enough. Sanjeev Gupta must invest in the business or step aside.”
His sentiments were echoed by Sarah Champion, Labour MP for Rotherham, who warned that the plant is critical for industries like aerospace, defence, and even Formula One.
Despite Liberty Steel’s assurances that it remains committed to keeping the plants open, creditors and employees remain skeptical amid repeated broken promises and instability.
⚠️ Growing Frustration Among Workers and Leaders
However, industry voices are losing patience.
Roy Rickhuss, general secretary of steelworkers’ union Community, stated:
“Failed restructuring plans and broken promises have become a familiar, demoralising pattern… New, responsible ownership is needed to give the business the brighter future it needs and deserves.”
Echoing this sentiment, Labour MP Marie Tidball supported the call for new leadership at the Stocksbridge site, emphasizing the need for “competent ownership.”
The UK Department for Business and Trade said it will “closely monitor” developments but reiterated that the company must manage its own commercial decisions.
🏛 Will the Government Intervene?
The UK government has refused to bail out Liberty Steel, stating that financial decisions must be handled by the company itself. However, officials have hinted that intervention may be possible — but only after a court-ordered insolvency process begins.
This cautious stance reflects lingering concerns about Liberty’s governance, as well as ongoing investigations by the Serious Fraud Office into GFG and Greensill.
Meanwhile, in a similar move, the government recently nationalised British Steel’s blast furnace operations in Scunthorpe, reflecting a willingness to step in — but only when collapse becomes unavoidable.
🔩 What This Means for the Global Steel Industry
Liberty Steel’s fate reflects the wider volatility in the global steel sector. Between geopolitical challenges, decarbonization pressures, and supply chain disruptions, legacy producers are facing enormous strain.
The UK’s steel output hit historic lows in 2024, and without swift intervention or strategic reform, more companies could find themselves in similar distress. The industry’s future may depend on whether players can adapt — or if newer, more agile firms rise to fill the gap.
🌍 Broader Implications for the Steel Industry
This crisis isn’t just about Liberty. The UK steel sector is facing historic headwinds:
- Soaring energy costs
- An over-reliance on cheap imports
- Decarbonization demands
- A lack of long-term industrial strategy
Liberty Steel’s situation is a clear warning that without strong governance, resilient supply chains, and sustainable business models, steelmakers around the world may face similar threats.
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