Tata Steel UK

As a result, 2.8 thousand jobs will be lost, 2.5 thousand of them within the next 18 months

Indian steelmaker Tata Steel has announced that it will shut down two blast furnaces (BFs) at its Port Talbot facility in the UK by the end of this year, BBC reports.

The closure of the BFs is part of Tata Steel’s plan to reorient its UK steel business by switching to electric arc furnaces.

The company’s statement provides an approximate schedule for the closure of blast furnaces and coke oven batteries at Port Talbot. This process will be phased. The first blast furnace will be shut down around mid-2024, and the remaining heavy assets will be closed in the second half of the year.

According to Tata Steel representatives, the proposal also includes a broader restructuring of other divisions and functions of the company.

The company said that the restructuring will potentially affect up to 2.8 thousand employees, with about 2.5 jobs lost over the next 18 months. The group promises a £130 million support package for affected employees, including severance packages, social programs, training and job search initiatives.

«The course we have chosen is challenging, but we believe it is the right one. We need to transform quickly to build a sustainable business in the UK in the long term,» Tata Steel CEO and Managing Director T. V. Narendran, said.

Earlier, it was reported that Tata Steel rejected the plan of the unions aimed at preserving blast furnaces. According to representatives of the workers, the company can no longer afford to continue production at the loss-making plant in South Wales, while it completes a four-year plan to move to more environmentally friendly production.

Tata Steel entered the British steel industry in 2007, winning a tender to acquire Dutch steelmaker Corus, the previous owner of the Port Talbot steel mill. After the 2008 recession and the global drop in steel demand and prices, the UK unit’s contribution to the company’s total production fell from almost 40% to just under 10%.

As GMK Center reported earlier, last November, Tata Steel postponed a public announcement on the future of its Port Talbot plant. Earlier, the British government agreed on a £500 million ($620 million) support package for the company’s green transition. Tata Steel was expected to invest £1.25 billion, including a grant from the government, in new electric arc furnaces to make steel production at the plant more environmentally friendly. The EAFs are to replace existing blast furnaces that are reaching the end of their useful life. Unions have warned that the deal will have «devastating consequences.»