Steelmaker SSI UK to mothball Redcar plant, cut 1,700 jobs

Mon Sep 28, 2015 6:42am EDT
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By Maytaal Angel

LONDON (Reuters) - Britain's second-largest steelmaker SSI UK said on Monday it would mothball its Redcar iron and steelmaking plant in northeast England, and axe about 1,700 jobs.

The loss-making company, a unit of Thailand's largest steelmaker Sahaviriya Steel Industries (SSI), has been hit by a severe slump in steel prices this year. It has also missed several debt repayments.

On Monday it said it would continue to work with stakeholders, including the government, with a view to restarting operations in the future. It will therefore keep its Redcar coke ovens and power stations running.

"This is an extremely sad day for all of us at SSI UK, and in particular our employees and their families," said Cornelius Louwrens, SSI UK's chief operating officer.

"Market conditions this year have been extremely challenging and unfortunately this has led to the decision we are announcing today," he said.

The Redcar plant is located in Middlesbrough - an economically deprived region of Britain, where locals fear permanent closure could put at risk thousands more jobs indirectly related to steelmaking.

"Our fight to save our steel will continue," said Roy Rickhuss, general secretary of trades' union Community.

"The blast furnace must be mothballed properly to give it the chance of a future. We have serious concerns about the ability of SSI to do this and so the government must step in," he said.   Continued...

A steel slab is cooled with water on the roller table at the SSI steel plant at Redcar, northern England May 29, 2012.  REUTERS/Nigel Roddis