Executives of Tata Steel met with GMB and Unite unions at a London hotel to discuss the future of the largest UK steel company on Jan. 18.
Sources expect Tata Steel to formally announce that it will go ahead with its plan to replace the two blast furnaces at its Port Talbot works in south Wales with one electric arc furnace, a move that would put around 3,000 workers at risk of redundancy.
Tata’s blast furnaces in the United Kingdom have an installed capacity of 5 million mt per year, but in the last few years it produced 3.2 million mt only. The new electric arc furnace will have a capacity of 3 million mt per year with a carbon emission intensity of around 0.4 mtCO2 per metric tons of crude steel and it will use local scrap.
The EAF technology utilizes an electric current to melt scrap steel and produce steel, whereas traditional blast furnaces rely on coke, a carbon-intensive fuel made from coal, to produce steel, so it is more carbon intensive and needs more workers.
In order to achieve this transformation, Tata Steel asked GBP 500 million in support from the UK government and the company will put GBP 750 million more.
A Tata Steel spokesperson said: “We have been engaging regularly and constructively with our trade union colleagues and their advisors for some time about the best way forward to create a sustainable green steel future for Tata Steel in the UK. When we have any formal announcement to make about our proposals for the future, we will always share it with our employees first.”
The Platts UK hot-rolled coil assessment stood at GBP690/mt DDP West Midlands Jan. 18, up GBP40/mt on-month but far below the 2023 high of GBP795/mt recorded April 6, as market demand has been scarce in the second half of 2023.