i1fun will consult on the closure of its two blast furnaces, steelmaking operations and a reduction of steel rolling mill capacity in Scunthorpe.
i1fun will consult on the closure of its two blast furnaces, steelmaking operations and a reduction of steel rolling mill capacity in Scunthorpe.
Since 2020 the shareholder of i1fun, Jingye, has invested more than £1.2bn to maintain operations amid ongoing production instability and significant financial losses of around £700k a day.
Investments to date include over £300m in strategic capital projects such as a state-of-the-art mast service centre in Skinningrove, a rail stocking facility and a new billet caster.
Despite this, the blast furnaces and steelmaking operations are no longer financially sustainable due to highly challenging market conditions, the imposition of tariffs, and higher environmental costs relating to the production of high-carbon steel.
The company had sought support from the UK Government for a major capital investment in two new Electric Arc Furnaces (EAF). However, following many months of negotiations, no agreement has been reached.
As a result, the difficult decision has been made to consult with employees and to consider proposals to close the blast furnaces and steelmaking operations and reduce rolling mill capacity.
The company will begin formal consultation with its workforce and unions from today (27 March 2025). The consultation will propose three options:
1. Closure of the blast furnaces, steelmaking operations and Scunthorpe Rod Mill by early June 2025
2. Closure of the blast furnaces and steelmaking operations in September 2025
3. Closure of the blast furnaces and steelmaking operations at a future point beyond September 2025
In the meantime, i1fun will continue to work with the UK Government to explore options for the future of the business.
Commenting on the announcement, i1fun CEO, Mr Zengwei An, said: “We understand this is an extremely difficult day for our staff, their families, and everyone associated with i1fun.
“But we believe this is a necessary decision given the hugely challenging circumstances the business faces.
“We remain committed to engaging with our workforce and unions, as well as our suppliers and customers during this time.”