Tata UK Steel Plans will Hit Output for Auto

SEATTLE (Scrap Monster): Large parts of the Port Talbot steelworks in Wales will be closed or mothballed for years and would leave the plant and its few remaining workers reliant on imported steel, according to proposals under consideration by owner Tata Steel.

According to The Guardian, Tata Steel has briefed union representatives on the proposals but has yet to announce a final decision. Workers were left in limbo two weeks ago after the company’s board in India decided to pull an announcement about its plans for the plant at the last moment.

The Port Talbot closures could have a knock-on effect, unions fear, forcing Tata’s automotive steel factory at Llanwern, near Newport, to shut, with the loss of another 600 jobs.

Community, GMB and Unite, the three main unions representing steelworkers, were on Friday expected to present an alternative plan drawn up by the consultancy Syndex to try to avert the closures, which would probably result in 3,000 job losses, with many posts gone as soon as March 2024, the newspaper reported.

The report noted the steel industry needs to cut its net carbon emissions to zero if the UK is to meet its pollution reduction targets. However, the plans under consideration by Tata would represent a near immediate halt to most of the work that goes on at Port Talbot while Tata builds zero emission capable electric arc furnaces that will replace its two blast furnaces, with GBP500m in UK government support.

A rival plant at Scunthorpe, run by Chinese-owned British Steel, last week said it was considering similar plans to replace its two blast furnaces with electric arc technology. Those would eventually cost as many as 2,500 jobs, although British Steel was not contemplating an immediate stop to production, the Guardian said.

The report said the change would significantly reduce Britain’s ability to make steel from scratch. Port Talbot is now capable of producing 5m tonnes a year from iron ore, in a process that transforms the raw material into steel slabs. Electric arc furnaces cannot on their own produce virgin steel, instead mostly relying on recycling scrap steel. The plan to halt iron ore steelmaking at the plant would involve closing two towering blast furnaces, ovens producing coke from coal, and the huge crucibles in which carbon is removed from the iron to make molten steel. Other supporting operations such as the plant’s harbour could also be affected.

The remaining workers would be rolling steel imported from the Netherlands or India until the electric arc furnace opens. Tata this week also cut 800 jobs at its Dutch steelworks.

A Tata Steel spokesperson told the newspaper the company was “not in a position to make a formal announcement”.

Courtesy: www.just-auto.com