UK Steel production increased significantly in January as the firm responded to increased demand for the metal for projects like security fencing.

Its data shows that production last month 35.4 per cent higher than in December 2010, at 201,152 tonnes a week compared to 148,574.

Production in Yorkshire and Humber, a major producing area in the UK, increased by 50 per cent, and in Wales there was an increase of about one fifth.

"The uplift in January output was heartening and is a reflection of the continuing improvement in UK manufacturing output generally," said UK Steel director Ian Rodgers.

"Nevertheless, we still have a long way to go to achieve pre-recession levels of steel output, with demand from the construction sector in particular remaining very weak."

Recently, steel firm Tata said it would hike the cost of its steel by £95 per tonne, as a consequence of spot prices in some commodities after the flooding in Queensland, Australia.ADNFCR-3337-ID-800418194-ADNFCR