UK steel sector urges government to leverage procurement reforms

by David Fleschen

The UK steel sector has called on the Government to prioritize domestic steel in public procurement, unveiling a new report, Public Procurement of Steel: Time for New Thinking for a Thriving Industry. Published by UK Steel, the report outlines strategies to boost the use of UK-made steel in taxpayer-funded projects, emphasizing its role in revitalizing the national steel industry and reducing reliance on imports.

With the Government being the largest steel purchaser in the UK, the sector sees significant potential for reforms. Currently, one-third of steel used in public projects is imported, costing taxpayers £1.5 billion annually. "This is taxpayers' money leaving our shores," said Gareth Stace, Director-General of UK Steel. "Strategic procurement can transform taxpayer investment into a win for the economy, safeguarding jobs and revitalizing our industry."

Unlocking Billions in Opportunities

The report features a case study from LumenEE, a consultancy specializing in renewable energy and supply chain analysis, which quantifies the steel demand in the UK’s offshore wind sector. Their research reveals that up to 25 million tonnes of steel will be needed by 2050 for offshore wind projects around Britain’s coastline—an opportunity worth approximately £21 billion.

"This independent analysis by LumenEE illustrates the immense potential for the UK steel industry to benefit from strategic investment in green infrastructure," Stace said. "It’s a clear example of how procurement reforms could turn government spending into growth for domestic businesses."

Key Recommendations for Policy Reform

UK Steel proposes five actionable steps to bolster domestic steel purchases, including:

  1. Domestic Content in Contracts – Mandating the use of UK-made steel in energy and infrastructure projects where feasible.
  2. Sustainability Criteria – Requiring contributions to sustainability and local content in contracts for difference (CfD) auctions.
  3. Infrastructure Projects Compliance – Ensuring adherence to the Procurement Policy Note for Steel with minimum local content requirements.
  4. Strengthened Procurement Policies – Mandating justifications for non-use of UK steel and consultation of a digital UK Steel Catalogue.
  5. Public-Private Investments – Driving investment into steel supply chains through partnerships to enhance resilience and attract economic growth.

Strategic Benefits for the UK

The recommendations align with the forthcoming Government Steel Strategy, which aims to position the UK as a leader in green and resilient supply chains. "Investing in Britain’s capacity to produce steel is essential for our economy and planet," said Alasdair McDiarmid, Assistant General Secretary of Community.

Dan McGrail, CEO of RenewableUK, highlighted the LumenEE report’s value: "This is the first time the offshore wind industry’s technical steel requirements have been laid out in such detail. It’s a roadmap for the Government, the renewable energy sector, and UK steel producers to align investments and capture this £21 billion opportunity."

As the Government prepares to allocate £2.5 billion from its National Wealth Fund to the steel sector, UK Steel emphasizes that supporting domestic production is a strategic win. "Incorporating our recommendations will reduce reliance on imports, strengthen supply chains, and position the UK as a global leader," Stace concluded.

Source: UK Steel, Photo: Fotolia

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