Friction stir welding of steel presents an array of advantages across many industrial sectors such as shipbuilding when compared to conventional fusion welding techniques. However, there seems to be very limited techno-economic assessment studies on its potential introduction in industry, and particularly in shipbuilding. A microstructure and property evaluation of friction stir welded low alloy steel grade DH36 plate, commonly used in ship and marine applications has been undertaken. In this comprehensive study, steel plates were butt welded together at increasing traverse speeds in order to improve the technical competitiveness of the process. Samples were examined microscopically and by traverse tensile testing, Charpy impact testing and micro-hardness testing in various regions of the weld. The study has examined a wide range of traverse speeds; from this, initial process parameter data have been established that are able to produce commercially attractive excellent quality welds through a substantial increase in the conventionally recognised welding traverse speed. In parallel, a comparative economic evaluation between friction stir welding and submerged arc welding has revealed a number of areas where the former is superior. However, the cost of the friction stir welding tool for steel has been exposed as the dominant obstacle for the wider commerical acceptance of the process on steel