Liberty Steel has put 440 jobs at risk as it plans to mothball three plants and cut production at another.
The company announced that its West Bromwich, Newport and Tredegar plants would be closed as part of a restructuring of its business.
Meanwhile, production at Rotherham is being scaled back due to high energy costs and foreign imports, which Liberty says have made the operation “unprofitable”.
A union called the announcement a “body blow” to workers.
Liberty said it has been forced to “refocus” its business to adapt to “challenging market realities.”
Up to 185 jobs have been threatened in Rotherham as plans to cut primary steel production, use imported metals and increase production of high-grade alloys.
Manufacturing and processing plants in South Wales are being shut down, putting 121 workers in Newport and 35 in Tredegar at risk of layoffs.
The company’s West Bromwich plant is also being put into hibernation, with 99 jobs at risk.
Liberty, part of billionaire metals magnate Sanjeev Gupta’s GFG Alliance, said it would resume production at the shut down facilities “if the market and operating conditions permit.”
The company said it hopes to find an alternative to layoffs through a program aimed at “retaining, redeploying and retraining” affected employees.
It added that the reorganization would provide a “viable way forward” for the company and help secure jobs across its broader workforce of 1,900 permanent employees and 3,100 contractors.
Jeffrey Kabel, Chief Transformation Officer, Liberty Steel Group, said: “While our actions are expected to regrettably impact the roles of some of our employees, we will offer a guaranteed salary and outplacement opportunities through our unique Workforce Solutions program as an alternative to.” Termination.”
He added that the company remains committed to its longer-term plan to convert its Rotherham plant into a low-carbon factory producing 2 million tonnes of crude steel annually.
Liberty Steel has struggled with cash flow problems since the collapse of its main financier Greensill Capital in 2021.
Alun Davies, national officer for the Steelmakers’ Union Community, said the announcement of potential job losses was “devastating” for employees, who “could not have done more” to support the company in its recent struggles.
He added: “Since the collapse of Greensill Capital, the unions have supported the company because we felt that presenting the company’s business plans, which were reviewed and endorsed by independent union experts, was the best way to safeguard jobs and the future of was all business.
“However, the plans we reviewed were based on significant investments and ramping up of production, including at Liberty Steel Newport, and did not involve the ‘idling’ of sites.”
The union also called on the UK government to “stop hesitating and act to achieve the competitive energy prices our industry so desperately needs”.
Sarah Champion, the Labor MP for Rotherham, said she was “disgusted and extremely angry” at the threat of redundancies and claimed workers had been “left to their fate” by the government.
She added: “There are simple steps the government could take to prevent this: buy British steel for government projects, offer competitive energy costs and deal with punitive tariffs.”
Labor MP Stephen Kinnock, leader of the All Party Parliamentary Group on Steel, said: “We all just have to realize the importance of the steel industry and its workers.
“The world will use more steel in the coming decades than it does today, and in the age of Putin’s invasion and China’s aggression, we desperately need steelmaking capacity here in Britain.”
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