Investing in technology for the processing of scrap metal could make UK steel-making competitive again, according to entrepreneur Sanjeev Gupta, chairman of the Liberty House Group, which bought some of Tata Steel assets.
Gupta said that the growing mountains of UK scrap offer a cheap and accessible source of raw material, which could be efficiently processed if companies invested in modern electric arc furnaces.
"We need to look at the present challenge as a great opportunity to reshape the industry so that it can be successful again," said Gupta, adding that the UK steel sector’s position is currently unsustainable as it only supplies 20 per cent of the country’s steel demand.
He envisions that the new electric arc furnaces would work side by side with traditional blast furnaces processing iron ore.
Liberty also announced it had started recruiting workers for the newly reopened Dalzell and Clydebridge steel plants in Lanarkshire, which it bought from Tata in April.
The company said it hoped to re-employ some ex-Tata workers who lost their jobs when the plants were mothballed last October. The first recruitment phase aims to fill up to 100 posts, with more expected in the new year.
"This moment marks a significant milestone in the process of bringing the steel business in Scotland back to life,” said Jon Bolton, chief executive of the division covering the two plants.
"It is a just reward for the dedication of the skilled workers who had to leave the business and it also presents an opportunity for new employees to join the Liberty family."
Over the past six months the firm has saved more than 1,500 jobs at steel plants in Wales and the West Midlands and it is now looking to re-establish the Scottish steel plate operations with a new business model, gradually restoring the jobs lost over recent months.
Tata continues to assess bids for its UK business, with thousands of jobs resting on its decision.