Liberty Merchant Bar to be 'mothballed', sources say

Liberty Steel will announce the mothballing of Liberty Merchant Bar (LMB) in Scunthorpe, England, this week, multiple sources told Argus.

LMB has effectively been mothballed for a couple of years, as it stopped producing in 2022 amid cash constraints and problems with energy supply. The mill was powered by gas captured in the coke-making process at British Steel, but that supply has now stopped.

Sources suggest the mothballing announcement is really a sign that the plant will not reopen, given it has been off line for so long. Around 135 staff are employed at the site — it is not clear whether they will be redeployed elsewhere in the group.

Liberty recently said it has signed a new framework agreement with its major creditors, following the refinancing of its Infrabuild business in Australia, which would enable it to "consolidate its UK steel businesses under a new entity with a simpler structure, a strong balance sheet and greater access to third-party finance and investment". Liberty has been promising to publish consolidated financial results since 2019, but is still yet to do so.

Under this consolidation, existing UK companies will transfer their assets and employees to the new entity, the company said. The change has enabled "development of a comprehensive plan that aims to take Liberty's electric arc furnace (EAF) melting capacity" at Rotherham to 2mn t/yr, the company added.

The two existing furnaces at the site — N and T — have a capacity of 1.2mn t/yr, but have been running well below this. Only T is running at present, following prepayment from aerospace customers, and it has produced less than 7,000t so far this year.

Liberty's eventual plan is to produce feed for longs and engineering bar from furnace N, feed for aerospace customers from furnace T, and to install a new EAF to produce slab for the company's plate and coil mills in Scotland and Wales.

The company declined comment.

By Colin Richardson