The film was written by Melissa Mathison, Spielbergs screenwriter on ET (and Harrison Fords former wife), who died of cancer before The BFG could be completed. Spielberg didnt even know she was sick, although she left the set in Vancouver a couple of times to see a doctor; he thought it was colitis. Mathison had been complaining of lack of sleep. She came back chipper and full of energy. One time after a visit, towards the end of shooting, she didnt come back for a couple of days and, when she did come back, she was sad. I said, Are you OK? She said, Yes, Im fine, but there was a sadness. I thought it was related to the fact that we were only a couple of weeks away from wrapping. We were almost done shooting the film and I thought she was feeling the weight of having been so connected to the material for so many years, and now it was just going to be moving into post-production. Later, I found out she had gotten some bad news.

He tails off. A master manipulator of emotions on the screen, he is more awkward about them in real life. He was in tears in the edit suite when it came to adding the final dedication, to Mathison. It was really devastating to lose her, but particularly for Steven, after having started way back on ET and having been on this whole journey, says his longtime producer Frank Marshall. You cant replace that kind of a relationship. The film is in many ways a record of their friendship, as was ET: a two-hander about a small, lonely child who befriends a non-human fantasy figure who struggles with English and turns out to need rescuing.

I ask Spielberg how much of him there is in the BFG. Me? he says. I think Melissa added both of us, of course. She added a large dollop of herself, and I think the part of me she probably put in was the trogglehumper, the bad dream because she knows that a lot of my fears have given rise to a lot of my stories. The stories always vanquish the fear. Melissa knows me so well, and weve often talked about my obsession with things that scare me. Everything has to start with fear. Loss, loneliness, being challenged and pursued by big forces. Its the loneliest story I think Ive ever told. These two lonely people find a way to make a difference. Those are touchstones that attracted me to the book. I read it to my kids, and the bullying was one of the things that I painfully associated with my own childhood. And also being able to grow out of my fears and often, when I do, feeling taller than the tallest giant. Size doesnt matter when loneliness is what our lives have meant to us.

Spielberg has only recently opened up about the bullying he received at high school in Phoenix, Arizona, and at Saratoga high in California. He was taunted with antisemitic slurs (the other kids sneezed A-a-jew! as he passed in the corridor) and beaten up after school. Children would tear past the house shouting, The Spielbergs are dirty Jews!

Spielberg responded by smearing peanut butter over their windows. One of his tormentors looked a little like John Wayne, so he cast him in one of his home movies, a second world war fighter pilot drama called Escape To Nowhere, shot on his dads Super 8 and using bags of flour for the explosions. The bully never touched him again. He learned an important lesson that day: film is power. Most of my friends were made through the camera, Spielberg says. Rather than make friends, then go off down to the soda fountain or go to where the kids would hang out, I would just go home and write my scripts and cut my films. I was pretty much isolated, but I had a hobby that I was obsessed by. I would come home from school and I would not go to friends houses to play. I would go to my bedroom and I would sit with my little editing machine.

Viewed this way, his career is one of the biggest instances of over-compensation in the history of movies, his films, like those early home movies, a way of controlling and mastering an inhospitable universe, making friends of enemies, absorbing threats. Accused by critics of hanging out in the kiddie pool for too long, he set himself on the path to cinematic maturity that would eventually lead to Schindlers List, only to follow up in the same year with Jurassic Park an astonishing stretch and, to his detractors, a sign of suspicious facility.

His films have attracted their share of bullies, too. Their moon-shots, playfulness and slam-dunking of box office records offend the notion of auteurist cool that drives admiration for directors such as Martin Scorsese and Stanley Kubrick. In his 2008 autobiography, Miracles Of Life, JG Ballard noted of his publicity tour for Empire Of The Sun that, Americans were unfailingly friendly and helpful, though I noticed an almost universal hostility to Steven Spielberg. One journalist asked me, Why did you allow Spielberg to make a film of your novel? When I replied that he was the greatest film director in America, he promptly corrected me: Not the greatest, the most successful.

Forbes magazine has estimated Spielbergs wealth at $3.6bn. For serving as executive producer on Jurassic World, he is said to have made more money than Universal. There are no intermediaries, there are no people to please. There is no studio presence, there is only his voice, says Koepp, who wrote the first two Jurassic Parks. Or, as producer Lynda Obst, who developed Interstellar with him, says, Steven is the studio. He is known as a steely negotiator. There was something Koepp didnt want to write into a script once; Spielberg kept reminding him that he had forgotten to do it. I said, Im not forgetting, I just really dont want to write that. He says, You shouldnt, you dont have to, you absolutely dont have to, but when I shoot it, heres how Im going to do it. Koepp wrote the draft.

Not that the last few years havent been choppy. Indiana Jones And The Kingdom Of The Crystal Skull was ripped apart by fans and critics alike for its George Lucas-originated McGuffin: anyone could have told them Indy shouldnt be sharing the screen with space aliens. In the same year, DreamWorks, the studio Spielberg launched with David Geffen and Jeffrey Katzenberg, parted ways with its partner Paramount. The costly $150m flop Cowboys & Aliens further winded the company, and in 2013 a glum Spielberg shared the stage with George Lucas at the opening of a cinematic arts school at the University of Southern California, lamenting the fact that, after struggling to find financiers, Lincoln came this close to being an HBO movie; he warned of the industrys impending implosion-by-superhero.

Spielberg is more sanguine now. DreamWorks was rebooted last year with a $200m cash injection from Participant Media, under the name of Spielbergs original production company, Amblin Partners. Returning to the Universal lot, where he made Jaws, Spielberg memorialised the moment by taking a picture with his iPhone. What I said was that the industry becomes completely dependent on a certain diet, he tells me. If the movie industry becomes too dependent on a certain genre, then the day that genre loses its popularity, like the great American westerns, which went to TV the minute that happens, unless there have been attempts to create new genres, new stories, big entertainments, the industry could take a collective hit. He pauses, then adds, I distinguish superheroes from science fiction. Science fiction will be around for ever.

Next up for him is the sci-fi thriller Ready Player One, also starring Rylance. After that comes The Kidnapping Of Edgardo Mortara, a Tony Kushner adaptation of David Kertzers book about a Jewish boy in Bologna, Italy, in 1858, who is forcibly taken from his family to be raised a Christian, also with Rylance; then its Indy 5 for Disney (no aliens this time) and possibly a remake of West Side Story, which Spielberg has dreamed of adapting for decades.

In a recent speech to Harvard students that went viral, Spielberg told them, Ive always said to my kids, the hardest thing to listen to your instincts, your human personal intuition always whispers; it never shouts. Very hard to hear.

Has he always heard it himself? Spielberg shakes his head. Its not like Im always being whispered at. It comes when I least expect it. I mainly listen to see if theres anything urging me forward when I meet a book or a script. I have a strong gut feeling about what Ive just read. It takes a very, very, very quiet, tiny whisper to get me to say, This one is for me. Im not going to give this away and produce it through my company. Im taking this for myself. The older he gets, the more he needs some chord struck with his childhood in order to commit to a project.

Meanwhile, he works on the stories he tells his grandchildren. Just the joy of being able to make stuff up and the joy of getting them to laugh, or getting them to be scared, knowing that Im going to rescue them from their fear in about nine seconds. That kind of fireside storytelling is the stuff I think dreams are made of. I just love doing it. Ive always done that. I look forward to it, the same way I look forward to making the next movie.

Has he copyrighted any of them? Spielberg laughs. I have not yet copyrighted a single story Ive told any of my kids or grandkids. Its fine. If any story inspires them, they can have it.

The BFG is released on 22 July