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UK Steel Sector Boosted by Defense Strategy, While Continental Plants Show Mixed Activity

Europe’s steel market shows a positive outlook driven by UK government initiatives, though continental plant activity is mixed. The UK’s new focus on domestic steel for defense could reshape procurement strategies. Satellite data shows fluctuations in European steel plant activity, but direct connections to UK policy changes are not yet evident.

The UK government is strengthening its domestic steel industry, driven by the understanding that it is critical for national security, as evidenced by the news articles “The UK government is considering a plan for the development of domestic steel production“, “UK’s new defense industrial strategy puts UK steel at core of national security” and “British defense strategy emphasizes priority for domestic steel“. While these articles detail policy shifts favoring domestic steel, no immediate and direct impact can yet be established based on the provided activity data from the satellite.

Bar chart and satellite map of steel production activity in Europe

The average steel plant activity across Europe lacks usable data, however, it appears there is a general downward trend for steel plant activity.

Uralwagonsawod steel plant, based in the Rostov region (Russian Federation), primarily serves the defense sector. Activity at this plant peaked in May 2025 at 44% but decreased to 39% by August 2025. There is no explicit link between this activity change and the named news articles.

AG der Dillinger Hüttenwerke Dillingen steel plant located in Saarland, Germany, is an integrated BF-BOF steel plant with a crude steel capacity of 2.76 million tonnes, producing semi-finished and finished rolled products for automotive, building, energy, and machinery sectors. The activity declined from 37% in March 2025 to 28% in August 2025. There is no explicit link between this activity change and the named news articles.

Diósgyőr Steelworks Miskolc, in Borsod-Abaúj-Zemplén, Hungary, operates an EAF with a capacity of 550,000 tonnes, focusing on semi-finished and finished rolled products for the building and infrastructure sectors. Its activity increased steadily from 5% in March 2025 to 14% in August 2025. There is no explicit link between this activity change and the named news articles.

The UK’s Defence Industrial Strategy will likely increase demand for domestically produced steel. Steel buyers should closely monitor UK steel prices, especially for grades used in defense applications, because of the newly implemented procurement preferences favoring domestic suppliers. European steel buyers should diversify their supply chains and assess the potential impact of reduced exports if the UK’s domestic steel industry becomes more self-reliant.