British Steel is cutting 400 jobs at its sites in the UK and elsewhere in Europe as it blamed a weak pound and euro for driving up costs.

The firm said it was shedding almost 10% of its 5,000-strong workforce in a bid to “streamline” its operations and secure a long-term future.

It is the first time the company has shed staff since it was reborn two years ago when investment firm Greybull bought the business for £1 from Tata Steel, saving it from collapse.

Nic Dakin, the Labour MP for Scunthorpe, where British Steel’s main steelworks is based, said the news was a devastating blow for workers who had already done “everything asked of them” to avoid job losses.

“They have taken a pay cut, seen their pensions change and worked hard to get British Steel on its way,” he said.

The MP attacked the government for not helping the industry “level the playing field” since the Tata Steel crisis three years ago, adding that ministers had still not agreed a steel sector deal.

“As we leave the EU the government is not giving steel the priority it needs to be confident of a fair deal post-Brexit,” he said.

Unions said they understood UK steelmakers faced challenging conditions but that the cuts were disappointing coming after the firm posted a £21m profit for the first three months of 2018.

“This announcement will come as a body blow to the workforce who have already made huge sacrifices to make the business sustainable,” the National Trade Union Steel Coordinating Committee said.

Workers had accepted a 3% pay cut during the first year of the company, which supplied all the rail tracks for London’s Crossrail project.

It is not yet clear where the job cuts will fall across the firm’s operations in the UK, Ireland, France and the Netherlands. However, 4,000 of the 5,000-strong workforce are based in the UK.

Gerald Reichmann, British Steel’s chief financial officer, said the company needed to adapt. “We’ve made a strong start to life as British Steel but our external environment is constantly changing. For example, raw materials are all traded in US dollars, so the weakening of the pound and euro have implications for us,” he said.

The company said US sales represented a small percentage of its exports but it was disappointed by steel tariffs imposed by Donald Trump.

Reichmann said British Steel had a strong long-term future focused on “profitable, niche products” and was not closing any of its sites.