Another blow for N.E. industry

[AgentAxeman 82]

Feel really sorry for the smoggies involved. Not a very happy chrimbo for teeside.

 

1,700 jobs to go as Corus mothballs plant

 

 

Steelmaker Corus has confirmed it will curtail production at its Teesside Cast Products factory, putting 1,700 people out of work.

 

It had been announced in May that the 150-year-old Redcar plant was to be mothballed.

 

The plant had been at risk since a 10-year deal suddenly fell through.

 

Business Secretary Lord Mandelson expressed his disappointment, saying it would be a "very difficult time for the workforce".

 

The plant is due to be mothballed at the end of January.

 

The deal that had fallen through was signed by an international consortium, led by Italian steel specialists Marcegaglia, in 2004, and committed the consortium to buy just under 78% of the Redcar plant's production.

 

Corus said that 1,700 jobs would go, which is about 600 fewer than had been previously thought. It says 2,300 people work at the facility.

 

"The steel industry overall has suffered an unprecedented fall in demand in the global recession," Lord Mandelson said.

 

"The government worked hard with all parties following the cancellation of the main supply contract in May to continue the agreement but a commercial solution could not be found."

 

The underlying cause of the problems at Corus has been a fall in demand for steel products, especially in Europe.

 

Construction and manufacturing companies are buying less. And, as so often before, the world's capacity to make steel greatly exceeds demand.

 

Manufacturing has suffered a sharp loss of jobs during the recession. And although manufacturing represents little more than one-eighth of the UK economy these days, it still generates almost half of our exports.

 

Much of the slab steel produced on Teesside was sold abroad. So the mothballing of the plant is another blow to any hope of narrowing Britain's persistent - and worrying - trade deficit.

 

Corus said it was partially mothballing the plant, shutting its blast furnace, its steel melt shop - which makes slab - and one of the two coke ovens.

 

It will be keeping open the wharf facility that handles imports and shipping, the other coke oven and some of the power generation capacity.

 

The company said operating a merchant slab plant with output of three million tonnes a year was "not sustainable" without a long-term partner.

 

"This is a dark day for British manufacturing," said Derek Simpson, joint general secretary of the Unite union.

 

"Unite will do everything possible to prevent this closure from going ahead. The government must now act to save Teesside as decisively as it acted to save the banks last year."

 

Kirby Adams - the Europe chief of Tata Steel, which owns Corus - confirmed the plant's closure to staff on Friday.

 

He said that Corus had funded the business since May, and at one point, it looked very likely that the plant would close in August.

 

Kirby Adams, chief executive, Tata Steel Europe: "This decision comes with massive human cost"

 

"Corus is not in a position where it can bankroll a loss-making business such as Teesside," Mr Adams said in a press conference. "We are acutely aware that this will be devastating news for our employees, our contractors, their families," he said.

 

"All four members of the consortium should look at this and hang their heads in shame."

 

Corus has made about 1,000 job cuts since January, and announced it was cutting almost 2,000 more jobs at its UK plants - including Teesside as well as Scunthorpe and Rotherham - in June.

 

"This is a gut-wrenching disappointment after all the effort and the hopes won by the sheer doggedness of our workers," said Redcar MP Vera Baird.

 

"I'm furious that, after our workers won months of export orders, Corus has not been able either to get a longer term contract or to clinch a deal for the sale of the plant."

[Gemmill 34662]

Shit time for shit times.

[Dr Kenneth Noisewater 0]

£40000 from every household in the country to prop up the banks (who are still wanting to pay themselves massive bonuses) but fuck all for the steelworkers. Not many with the right old school tie working on the blast furnace I guess.

[Rob W 0]

well we might get our money back from the banks but why we're still in the steel business these days is beyond me............. it;s a business for India, China and OZ

[Matt 0]

Pretty grim stuff and the article on the Beeb about the knock on consequences was spot on. It's an impossible task to compete internationally in these industries anymore.

[Rob W 0]

ay e- it sthe brains industries we need to be in - like reality TV shows

[chris p 0]

Absolutely awful news, I was made redundant last year and working in a specialized industry myself i know how hard it is to find work.

My advice would be all 1,400 up sticks and fuck off to Italy . guaranteed they know more , therefore a massive asset

[Guest alex]

Absolutely awful news, I was made redundant last year and working in a specialized industry myself i know how hard it is to find work.

My advice would be all 1,400 up sticks and fuck off to Italy . guaranteed they know more , therefore a massive asset

Hey. How you doin'?

[ChezGiven 0]

I watch Look North regularly (i've got a dodgy Sky account but channel 970'odd is NE & Cumbria BBC) and it pains me to see the amount of news like this.

 

On a more optimistic note, Mervyn King chose the NE (The Chronicle itself iirc) to hint (actually announce) his intentions for Sterling devaluation. The growth strategy post-recession for the UK is to try and encourage export-led growth. If the BoE allows the pound to devalue (which it will naturally unless they intervene) then our exporters are more price competitive. At the time of the announcement, OneNorthEast had just been granted millions from EU Development funds to facilitate business relationships for small manufacturing companies located in the NE with their EU counterparts. The two announcements together gave me a lot of optimism for the North East but since then (late August) we've seen a lot of shit news for jobs in the area. Hopefully that isnt sign of failing strategy but more a structural shift - i.e. the jobs that are going will be replaced by new ones if the strategy works.