Prince Andrew steps into Tata Steel crisis

On a trip to China to build Anglo-Sino links, Prince Andrew is understood to have talked with President Xi Jinping about Britain’s beleaguered steel sector, reports The Telegraph.

The Duke of York’s discussions in Beijing are especially critical as China has been accused of being one of the major causes of the crisis, with China’s largely state-backed steel mills dumping excess production in Britain.

Although the content of discussions between members of the Royal family and heads of state is never officially disclosed, one source close to the talks said: “It wouldn’t be surprising if the Duke discussed the current situation of the global steel industry with the President.”

The Conservative government is desperately trying to save Britain’s steel industry after Tata Steel UK, which employs about 15,000 people here and supports another 25,000 positions, was put up for sale by its Indian parent company last week.

The Tata group board voted against a further £100m investment to turn around the loss-making business, including the giant Port Talbot steelworks in south Wales.

Senior politicians including Prime Minister David Cameron, Chancellor George Osborne and Business Secretary Sajid Javid have staged meetings to try to find a way out of the crisis.

The Government has pledged it will do all it can to support a deal, and yesterday held initial meetings with potential buyers.

The Duke of York’s involvement – while on a self-funded trip to build science and entrepreneurship links between the countries – highlights just how desperate the UK Government sees the situation.

Whitehall sources said members of the Royal Family would not discuss such important issues without input from relevant government departments.

Gareth Stace, director of trade body UK Steel, said: “This illustrates the severity of the steel crisis and that every echelon of society is affected and keen to see swift action.”

Britain’s steel industry is buckling under pressure from high energy costs and a more onerous tax regime than in many rival nations, but also slowing global demand which has led China to flood the market with its excess production.

The industry and unions have demanded the Government pushes for the EU to hit Chinese steel with high trade tariffs to stem the flow of imports.

However, Britain has refused to back tougher duties, saying this could harm UK industries which currently benefit from the supply of cheap steel, such as construction.

The EU import tariff on rebar steel – used to reinforce concrete – is just 13pc – a level which UK Steel has called “a slap in the face” to the industry.

But it emerged at the weekend that China has imposed a 46pc import duty on the type of high-tech steel produced by Tata in South Wales.

Potential buyers for Tata’s UK operations – which are estimated to be losing £1m a day – met with Mr Javid today about what government support could be offered to seal a deal.

Commodity group Liberty House is one potential buyer and its executive chairman Sanjeev Gupta said he believed Tata’s unprofitable businesses could be turned around.

Speaking after what he called a “positive meeting” with the Business Secretary, Mr Gupta said: “The Government appears highly supportive and is proactively engaged in finding a long-term solution. The next step is for Tata to define the formal sales process and request indications of interest from potential buyers.  We await further details on this and then will assess our own next step. Everyone is very motivated to find a solution.”

Liberty House – which has already purchased Tata’s Scottish steel plants – could modernise the Port Talbot operations by use electric arc furnaces rather than blast furnaces, Mr Gupta said, and melt recycled steel or scrap.

“We have an alternative suggestion which is to still make hot metal but to make it from local raw material rather than imported raw material, so it’s a change of technology rather than ending liquid steel making,” he said. Liberty house recently agreed a deal to buy a mothballed arc furnace – which is powered by electricity rather than coal – from a redundant steel plant in Kent.

Speaking in a radio interview Mr Gupta said he aimed to protect jobs if his company became a formal bidder.

“If we get involved in Port Talbot we will only do so on the basis that we are confident there will not be any mass redundancies.”