Tata Steel confirmed today that it will stop both blast furnaces at its Port Talbot plant in south Wales, meaning the closure of related facilities such as coking ovens and the steel shop.
The first furnace will close around mid-2024, while the second furnace and other heavy end assets will close in the second half of the year.
The plant will continue to roll slab into hot-rolled coil (HRC) for a transition period, importing from Tata India, the Netherlands and other "strategic suppliers" on the international market. The company has already been importing HRC, amid stability problems with its furnaces and the hot strip mill. Around 2,500 jobs will be affected over the next 18 months, the company said. The continuous annealing processing line (CAPL) will close in March 2025.
Continued HRC imports will likely mean that changes will need to be made to import quotas under the UK's steel safeguard, as historical volumes do not account for Tata importing so much material. Its recent imports have strained the 'other countries' quota for HRC, while the Indian hot-dip galvanised quota has also filled quickly in the past two quarters.
The Community Trade Union said Tata and the UK government "must reconsider their positions in order to safeguard the future of British steelmaking, and head off a major industrial dispute". The government has agreed to give Tata £500mn towards the installation of a new 3mn t/yr electric arc furnace, which will be operational by 2027. As part of the deal, Tata agreed to invest £700mn.
But unions have lambasted the deal, which they say has ignored other options such as direct-reduced iron, which could allow Tata to continue producing virgin iron in the UK.
The closure of the blast furnaces is not just driven by Tata's need to decarbonise, it also wants to stem its losses. The company made a £674mn loss after tax in the 2022-23 financial year ending in March. It produced 3mn t in that year, considerably below nameplate capacity of 5mn t.
