Quote:
Originally Posted by Russ
If the steelworks closes then it will destroy Port Talbot. I'll be the first to slag the town off (although I won't let people who have never been there have a go at it for some reason....), I grew up and lived there for 30+ years and it's not the prettiest by any stretch of the imagination but PT without the plant will massively impact what is already an unemployment blackspot. It's estimated 25,000 jobs will go if you also factor in all the companies that rely on the steelworks or have strong business ties to it. Port Talbot has a population of around 35,000.
Re-nationalisation if only temporarily while the place is stabilised long enough to make it viable for a buyer to come along seems the only way forward. The government did it with the banks, why not the steelworks? Ah that's right, PT and the steel industry is too working class.....
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The problem is, without another super-cycle in commodities like we have seen with China, it is unlikely PT will ever be viable as it stands.
There's a reason why most of US made steel is now made with methods other than blast furnaces at the start of the process (Info here:
https://en.wikipedia.org/wiki/Iron_a..._United_States) and at least 2 major blast furnace powered sites have shut down in the last decade there.
Newer methods of steel production can be varied due to demand, and idled when supply outstrips demand. Blast Furnaces cannot be idled, and thus, PT has had to continue to produce iron and thus too much material to make steel. Furthermore, blast furnaces are by far the most expensive production method to run, are not exactly environmentally friendly, and unlike newer methods, cannot work with scrap iron and steel.
Basically, the PT blast furnaces are doomed, and whether it gets a stay of execution or not is really besides the point. As we have seen calls for nationalisation, I think a better use of around the money would be to help pay for new, modern furnaces at PT, that can then feed the steelworks and other industry. That way we can keep a vital industry (The steel producing side is very, very much required for manufacturing here), but ditch the part which is causing most of the problems.
Again, like I said before, it'll be painful, as it will mean heavy job losses on the furnace side as modern production methods are leaner and need less manpower, but it will safeguard production here for decades and protect against price shocks like we have seen, rather than punt things down the road and hope that prices don't fall again. I've lost count of the amount of times I hear "Well, once Steel prices rise, we will be fine", but nothing acknowledging that if steel prices fall again after that, we'll be back here.
We cannot stay with the status quo. Govt has a role to play to help transition PT into a 21st century facility, but cannot subsidise a legacy industry just because.
I will never slag off PT, the workers there or the community. It isn't their fault at all and the whole community needs as much assistance as can be granted. However, that means taking brave steps for the long term, and short term, it will hurt.