Haydn Swidenbank points towards a rickety yellow cabin, perched 10ft up on a metal gantry that overlooks the hot strip mill. “You wouldn’t trust someone on their own up there in the pulpits [monitoring points] until they have been doing it for two or three years,” says the operations director of Liberty Steel Newport.

Inside the cabin, two men peer through scratched plexiglass at a 15-tonne slab of volcanic steel that rattles along the 300m-long conveyor below, which rolls and stretches the hot metal. Data on a computer screen helps them to monitor the temperature of the orange slab and the pressure of the water jets that cool the hissing strip as it moves along the line.

Britain’s steel industry is in meltdown after being hit by a toxic combination of slowing demand, high energy costs, green taxes and a deluge of cheap Chinese product that has halved the global price of steel.

It has been a brutal autumn, with thousands of job losses announced by Thai group SSI, which shutdown its plant in Redcar; Lord Paul’s Caparo Industries, which fell into administration; and Tata Group, the Indian conglomerate that owns the rump of the former British Steel, has put 1,200 jobs in doubt at its long-products arm, based mainly at its Scunthorpe mill – although this week a potential saviour emerged in the form of investors Greybull Capital, who could come to a deal to buy the division.

Nevertheless, the extent of the cuts show the way British steel has been affected by the slowdown in China’s economy. Demand in China is weakening as policymakers seek to steer Asia’s biggest economy away from investment-led growth to one driven by consumer demand and services.

As its domestic growth cools, Beijing has aggressively grabbed whatever foreign currency it can for its products. Rather than taking their foot off the pedal, Chinese mills have maintained production rates and flooded the world with steel exports.

Analysts at UBS reckon China will this year produce 441m tonnes more than it will consume. The excess of cheaply made Chinese steel on the market has halved prices, making British steel unprofitable.

China produces half the world’s steel output, giving it a huge influence on pricing. It churned out 822.7m tonnes in 2014, compared with a global output of 1,670m tonnes. Exports of Chinese steel climbed 22% to 102m tonnes in the first 11 months of 2015, according to customs data. That was almost as much as Japan, the world’s second-biggest producer, made in the whole of last year, according to World Steel Association data.

Chinese exports alone are now 50% larger than the entire US domestic production of steel, according to Macquarie. The bank forecasts China will continue to export more than 100m tonnes a year until the end of the decade. It does not see the steel price recovering until then.

The forecasts paint a pretty grim picture for British steelmakers. However, there are a few encouraging signs of life springing from this industrial tundra.

While the likes of SSI, Tata and Caparo have suffered, Liberty has prospered. In October, at the height of the steel crisis, it re-opened the hot strip mill in Newport, south Wales, after idling it for two years. A month later, Liberty snapped up Caparo’s tubes business, saving 350 jobs. This month, it grabbed the advanced engineering arm of Caparo, preserving a further 600 jobs.

What gives Liberty the confidence to invest so heavily in British steel when others are running for cover? Sanjeev Gupta, chief executive of parent company Liberty House Group, noted it can take advantage of the low steel price because it does not produce steel.

Liberty imports steel slabs from producers such as Severstal in Russia to its hot strip mill in Newport. It then heats the huge slabs to 1,300C and rolls and stretches them into long sheets before they are wound into 6ft-high coils. These coils are sold to manufacturers to make crash barriers, fencing, lorry chassis, office furniture or tooling.

The UK market for steel coil is 1.1m tonnes, split between Liberty and Tata. Gupta believes that with costs kept in check, there can be a bright future for British steel. “The best way to make steel for domestic consumption is domestically,” he says. “There are costs associated with moving steel around. It should be regionalised and localised as much as possible. Also, if you don’t make steel, you don’t make anything.

“I totally endorse the fact that there is a serious crisis in the global steel industry. We believe there is a way of tackling that … by having an entrepreneurial approach, to make decisions quickly and act quickly. But the steel industry is not traditionally about agility and speed.”

Gupta founded Liberty as a metals trading company from his student flat at the University of Cambridge in 1992. It now has a turnover of about $6bn and operates from four financial hubs in London, Dubai, Singapore and Hong Kong.

The businessman bought the former Alphasteel mill in Newport out of administration in 2013 and immediately mothballed it. Rather than axing the 150 staff, Gupta put them on gardening leave on half pay.

Swidenbank said the Liberty chief did not want to risk losing good, experienced staff because he knew he would need them when the time was right. Two years later, they are all back at the plant and ready to push forward with Gupta’s blueprint to breathe new life into the mill.

At its peak, in 2007, the plant employed 650 people. Gupta and his team have their work cut out if they want to drag the site back to those lofty heights. The challenge does not seem to faze Swidenbank. “I have ambitions,” he says. “Sanjeev would like higher levels of productivity, so it [staff numbers] will go up. He wants to expand in the UK market in a big way.”

The Newport mill is on course to churn out half a million tonnes of steel coil a year and the plan is to quickly double that to 1m tonnes. Gupta acknowledges it may also be possible in future to restart one of the electric arc furnaces on site, which would enable Liberty to make its own slab by melting down domestic scrap.

“We can produce slab even cheaper if we make it ourself,” he says, noting that Britain is currently a net exporter of scrap steel.

However, Gupta said he would need to be reassured that there was action and support from the government to assist with energy costs before deciding to press ahead with investment to restart the arc furnace.

“There’s more to be done but the energy intensive industries initiative is now under way. It will help, it’s a step in the right direction,” he says. “We’ll take our time, but in a couple of years we could be melting.”

Not content with reviving one casualty of Britain’s post-industrial wasteland, Gupta turned his attention to Lord Paul’s ailing Caparo steel empire. A grab for its tubular business was a no-brainer. “It makes pipes and tubes for the automotive and aerospace sectors and its principle material is hot rolled coil, which we produce. So that’s a big advantage for us,” says Swidenbank.

Gupta admits he has been drawn to Britain’s steelmaking industry despite the global headwinds faced by the sector. “I almost feel it’s my calling at the moment. I believe we can do it.” The entrepreneur reckons it is time to tackle the industry “in a fresh, young way”.

The businessman also indicated he may be keeping a close eye on developments at Tata’s Scunthorpe plant. “I won’t speculate about the future, but Redcar was difficult,” Gupta said, adding: “I believe in the UK steel industry and we will evaluate every option.”