Decisions taken within the next few days will determine whether British Steel’s Scunthorpe plant stays open, the BBC understands.
The plant’s Chinese owner, Jingye, has cancelled two cargo shipments of coking coal for the site’s two blast furnaces and it has not yet paid for iron pellets that are scheduled to arrive next week.
Without coal and iron ore, the blast furnaces will shut down within weeks.
Last week British Steel launched a consultation on the proposed closure of its two blast furnaces at Scunthorpe, putting up to 2,700 jobs at risk.
It has been meeting with the trade unions Community, GMB and Unite.
The GMB’s national officer, Charlotte Brumpton-Childs, said that a union meeting with workers on Wednesday had shown that ”Jingye has no intention of running the plant responsibly. Nationalisation is now the only option to save UK steel-making.”
Sources close to the consultation accuse Jingye of deliberately undermining talks to save the plant by closing down the supply of raw materials.
British Steel said: “We are not able to comment at this time”.
The assistant general secretary of the union Community, Alasdair McDiarmid, said: “The situation is extremely concerning, and it would be an abject disaster if the business was allowed to close by default due to a lack of raw materials.
“We are now approaching a critical crossroads. If a deal can’t be reached with the company, the government must move swiftly to avert a disastrous cliff edge by nationalising the business.”
British Steel has been owned by Jingye since 2020. The Chinese firm says it has invested more than £1.2bn into British Steel to maintain operations and claims it has suffered financial losses of about £700,000 a day.
Zengwei An, the company’s chief executive, said the launch of the consultation process had been “a necessary decision given the hugely challenging circumstances the business faces”, including the imposition of US tariffs and higher environmental costs.
The BBC reported last week that the company had drawn up a £2bn investment plan and that it had expected the government to contribute half.
The BBC understands that British Steel recently rejected a government offer of £500m.
There are growing calls for the government to nationalise the company.
On Tuesday, North Lincolnshire Council voted unanimously in favour of the company being brought back into public ownership, while last week in Parliament, Conservative MPs and the deputy leader of Reform UK, Richard Tice, also called for nationalisation.
Questioned on the BBC’s Today programme on Thursday, Business Secretary Jonathan Reynolds said he was ”strongly committed to the UK having a steel industry” and that he was making sure ”we are closely engaged on this issue”.
However, he declined to comment on reports that public ownership was being actively considered by ministers, saying: “We are talking to the company. It’s in private ownership, that is the situation that we have inherited, we are trying to find a way through that.”
“I know for the workforce in particular this is a really difficult time,” he added.
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