Tata Steel's announcement that was pulled at the last minute involved the idling of its hot strip mill in the coming months as well as its blast furnaces.
The idling of the strip mill would leave Tata as an importer of hot-rolled coil (HRC), possibly from its Indian parent, that would be further processed into downstream products in the UK.
In a conference call today announcing its latest results, Tata said it would import 2.5mn-2.6mn t to ensure a stable supply chain for its downstream unit.
This would involve a change to the UK's steel safeguard — without domestic production, HRC would no longer be included and be importable duty-free from all regions without dumping/subsidy duties.
"We will look to engage formally with the trade regulatory authorities at an appropriate time, because the quotas are also in the context of the fact that if the upstream in the UK does not operate, we are the only flat product producer, so from a trade perspective that will be addressed in the due course," Tata said in its conference call.
Union sources said the plan would involve the loss of 3,000 jobs, although this was not confirmed by Tata. Senior trade unionists called to a meeting with Tata on Wednesday told the company they would ballot for industrial action if this was the plan. One unionist told Argus it was "industrial vandalism".
"We will never accept Tata and the government's plan to close down our iron and steelmaking facilities and supply our mills with foreign steel for however many years it takes them build an EAF," Community Trade Union general secretary Roy Rickhuss said.
Tata's board is now likely to evaluate a report from Syndex on potential alternatives to its plan before making another announcement.
