Tata Steel has announced the closure of its two blast furnaces at the Port Talbot plant in South Wales, UK, leading to the loss of 2,800 jobs as part of its commitment to environmentally friendly operations. The steelmaker will initiate statutory consultation on the proposed restructuring plan, aiming to transition from legacy blast furnaces to a more sustainable, green steel business.
Tata Steel plans to replace the blast furnaces with electric arc furnaces to reduce emissions and costs. The move is expected to decrease CO2 emissions by 5 million tonnes annually while securing most of Tata Steel UK's existing product capability. The closure of the blast furnaces will also impact related facilities like coking ovens and the steel shop.
Approximately 2,800 employees are expected to be affected, with 2,500 roles impacted within the next 18 months and an additional 300 jobs in three years. Tata Steel intends to maximize voluntary redundancies and allocate over GBP 130 million to a comprehensive support package for affected employees, including skills training and job-seeking initiatives.
Despite the job cuts, Tata Steel plans to maintain operations at the site's hot strip mill, saving around 200 positions. The company will continue to roll slab into hot-rolled coil for a transitional period, importing from Tata India, the Netherlands, and other international suppliers.
T V Narendran, CEO and Managing Director of Tata Steel, acknowledged the difficulty of the decision but emphasized its necessity for building a sustainable business in the UK for the long term. The Community Trade Union called for reconsideration from Tata and the UK government to safeguard the future of British steelmaking.
The UK government has committed GBP 500 million to support the installation of a new 3 million tonnes per year electric arc furnace by 2027. However, unions criticize the deal, suggesting alternative options such as direct-reduced iron were ignored. Tata Steel defended its decision, stating that trade union proposals to continue production during the transition were not feasible or affordable.
The phased closure of Port Talbot's blast furnaces is expected to begin in mid-2024, with the remaining heavy-end assets winding down in the second half of 2024. The proposal also involves wider restructuring across the company, including the intended closure of the Continuous Annealing Processing Line in March 2025. Despite the government's investment, critics describe the strategy as "GBP 500 million for 3,000 job losses."
(With Agency Inputs)